STRUCTURED ASSET MORTGAGE INVESTMENTS II INC.,
as DEPOSITOR,
and
▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION,
as GRANTOR TRUSTEE
GRANTOR TRUST AGREEMENT
Dated as of August 31, 2007
Structured Asset Mortgage Investments II Grantor Trust 2007-AR4
Mortgage Pass-Through Certificates, Series 2007-AR4
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS................................................................................1
ARTICLE II CONVEYANCE OF UNDERLYING CERTIFICATES; ORIGINAL ISSUANCE OF CERTIFICATES...................7
Section 2.01. CONVEYANCE OF UNDERLYING CERTIFICATES TO GRANTOR TRUSTEE..........................7
Section 2.02. ACCEPTANCE BY GRANTOR TRUSTEE.....................................................8
Section 2.03. SWAP AGREEMENT....................................................................8
Section 2.04. REPRESENTATIONS AND WARRANTIES CONCERNING THE DEPOSITOR...........................8
ARTICLE III ACCOUNTS...................................................................................9
Section 3.01. GRANTOR TRUST DISTRIBUTION ACCOUNT................................................9
Section 3.02. PERMITTED WITHDRAWALS AND TRANSFERS FROM THE GRANTOR TRUST DISTRIBUTION
ACCOUNT..........................................................................10
ARTICLE IV CERTIFICATES..............................................................................10
Section 4.01. CERTIFICATES.....................................................................10
Section 4.02. REGISTRATION OF TRANSFER AND EXCHANGE OF CERTIFICATES............................12
Section 4.03. MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES................................14
Section 4.04. PERSONS DEEMED OWNERS............................................................14
Section 4.05. ERISA RESTRICTIONS...............................................................14
ARTICLE V PAYMENTS TO CERTIFICATEHOLDERS............................................................15
Section 5.01. DISTRIBUTIONS ON THE CERTIFICATES................................................15
Section 5.02. ALLOCATION OF LOSSES.............................................................16
Section 5.03. PAYMENTS.........................................................................16
Section 5.04. STATEMENTS TO CERTIFICATEHOLDERS.................................................17
ARTICLE VI INDEMNIFICATION...........................................................................17
Section 6.01. INDEMNIFICATION OF THE GRANTOR TRUSTEE...........................................17
ARTICLE VII CONCERNING THE GRANTOR TRUSTEE............................................................18
Section 7.01. DUTIES OF THE GRANTOR TRUSTEE....................................................18
Section 7.02. CERTAIN MATTERS AFFECTING THE GRANTOR TRUSTEE....................................20
Section 7.03. GRANTOR TRUSTEE NOT LIABLE FOR CERTIFICATES OR MORTGAGE LOANS....................21
Section 7.04. GRANTOR TRUSTEE MAY OWN CERTIFICATES.............................................21
Section 7.05. EXPENSES.........................................................................22
Section 7.06. ELIGIBILITY REQUIREMENTS FOR GRANTOR TRUSTEE.....................................22
Section 7.07. INSURANCE........................................................................22
Section 7.08. RESIGNATION AND REMOVAL OF THE GRANTOR TRUSTEE...................................22
Section 7.09. SUCCESSOR GRANTOR TRUSTEE........................................................23
Section 7.10. MERGER OR CONSOLIDATION OF GRANTOR TRUSTEE.......................................24
Section 7.11. APPOINTMENT OF CO-GRANTOR TRUSTEE OR SEPARATE GRANTOR TRUSTEE....................24
Section 7.12. FEDERAL INFORMATION RETURNS AND REPORTS TO CERTIFICATEHOLDERS; GRANTOR
TRUST ADMINISTRATION.............................................................25
ARTICLE VIII TERMINATION...............................................................................28
Section 8.01. TERMINATION UPON REPURCHASE BY THE DEPOSITOR OR ITS DESIGNEE OR
LIQUIDATION OF THE MORTGAGE LOANS................................................28
ARTICLE IX MISCELLANEOUS PROVISIONS..................................................................29
Section 9.01. INTENT OF PARTIES................................................................29
Section 9.02. ACTION UNDER UNDERLYING DOCUMENTS................................................29
Section 9.03. AMENDMENT........................................................................29
Section 9.04. RECORDATION OF AGREEMENT.........................................................30
Section 9.05. LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS.......................................30
Section 9.06. ACTS OF CERTIFICATEHOLDERS.......................................................31
Section 9.07. GOVERNING LAW....................................................................32
Section 9.08. NOTICES..........................................................................32
Section 9.09. SEVERABILITY OF PROVISIONS.......................................................33
Section 9.10. SUCCESSORS AND ASSIGNS...........................................................33
Section 9.11. ARTICLE AND SECTION HEADINGS.....................................................33
Section 9.12. COUNTERPARTS.....................................................................33
Section 9.13. NOTICE TO RATING AGENCIES........................................................33
Section 9.14 ENFORCEMENT OF RIGHTS............................................................33
Section 9.15. BENEFICIARIES....................................................................33
Exhibit A FORM OF CERTIFICATES
Exhibit B COPY OF UNDERLYING CLASS A-4B CERTIFICATE
Exhibit C FORM OF SWAP AGREEMENT
Exhibit D UNDERLYING POOLING AND SERVICING AGREEMENT
GRANTOR TRUST AGREEMENT
Grantor Trust Agreement, dated as of August 31, 2007, between Structured Asset Mortgage Investments II
Inc., a Delaware corporation, as depositor (the "Depositor") and ▇▇▇▇▇ Fargo Bank, National Association, a
national banking association, as grantor trustee (the "Grantor Trustee").
PRELIMINARY STATEMENT
On the Closing Date, the Depositor will acquire the Underlying Certificates (as defined below). On the
Closing Date, the Depositor will transfer the Underlying Certificates and receive the Certificates evidencing the
entire beneficial ownership interest in the Trust Fund.
The Grantor Trustee on behalf of the Trust shall make an election for the assets constituting the Trust
Fund to be treated for federal income tax purposes as a grantor trust.
In consideration of the mutual agreements herein contained, the Depositor and the Grantor Trustee agree
as follows:
ARTICLE I
Definitions
Whenever used in this Agreement, the following words and phrases, unless otherwise expressly provided or
unless the context otherwise requires, shall have the meanings specified in this Article. Capitalized terms not
otherwise defined herein shall have the meanings assigned to such terms in the Underlying Pooling and Servicing
Agreement.
Accrued Certificate Interest: For each Distribution Date and the Certificates, the interest accrued
during the related Interest Accrual Period at the Pass-Through Rate on the Current Principal Amount of the
Certificates immediately prior to such Distribution Date, less any Underlying Interest Shortfall allocated to the
Underlying Certificates pursuant to the Underlying Pooling and Servicing Agreement. Interest on the Certificates
shall be calculated on the basis of a 360-day year and the actual number of days in the related Interest Accrual
Period.
Affiliate: As to any Person, any other Person controlling, controlled by or under common control with
such Person. "Control" means the power to direct the management and policies of a Person, directly or
indirectly, whether through ownership of voting securities, by contract or otherwise. "Controlled" and
"Controlling" have meanings correlative to the foregoing. The Grantor Trustee may conclusively presume that a
Person is not an Affiliate of another Person unless a Responsible Officer of the Grantor Trustee has actual
knowledge to the contrary.
Agreement: This Grantor Trust Agreement and all amendments hereof and supplements hereto.
Available Funds: With respect to each Distribution Date and the Underlying Certificates, the sum of (i)
any payments received by the Grantor Trustee with respect to the Underlying Certificates and (ii) any payments
received by the Grantor Trustee from or with respect to the Swap Counterparty pursuant to the Swap Agreement,
following the payment of amounts to reimburse the Grantor Trustee for its reimbursable expenses as set forth
herein.
Bankruptcy Code: The United States Bankruptcy Code, as amended as codified in 11 U.S.C. §§ 101-1330.
Book-Entry Certificates: The Certificates.
Business Day: Any day other than (i) a Saturday or a Sunday, or (ii) a day on which the New York Stock
Exchange or Federal Reserve is closed or on which banking institutions in the jurisdiction in which the
Underlying Trustee, the Custodian or the Servicer are authorized or obligated by law or executive order to be
closed.
Certificate: Any Class A-4B Certificate evidencing a beneficial ownership interest in the Trust Fund
signed by the Grantor Trustee in substantially the form annexed hereto as Exhibit A with the blanks therein
appropriately completed.
Certificate Owner: Any Person who is the beneficial owner of a Certificate registered in the name of
DTC or its nominee.
Certificate Register: The register maintained pursuant to Section 4.02.
Certificateholder: A Holder of a Certificate.
Class: With respect to the Certificates, Class A-4B.
Closing Date: August 31, 2007.
Code: The Internal Revenue Code of 1986, as amended.
Corporate Trust Office: With respect to the Grantor Trustee and the presentment of Certificates for
registration of transfer, exchange or final payment, ▇▇▇▇▇ Fargo Bank, National Association, ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Trust Group, Structured Asset Mortgage
Investments II Grantor Trust 2007-AR4, and for all other purposes, ▇.▇. ▇▇▇ ▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (or for
overnight deliveries, ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇), Attention: Corporate Trust Group,
Structured Asset Mortgage Investments II Grantor Trust 2007-AR4.
Current Principal Amount: With respect to the Certificates as of any Distribution Date, the initial
principal amount of the Certificates on the Closing Date, reduced by (i) all amounts allocable to principal
previously distributed with respect to the Certificates and (ii) the principal portion of all Underlying Realized
Losses allocated prior to such Distribution Date to the Certificates (indirectly through the Underlying
Certificates).
Cut-Off Date: August 1, 2007.
Depositor: Structured Asset Mortgage Investments II Inc., a Delaware corporation, or its successors in
interest.
Distribution Date: The 25th day of any month, beginning in the month immediately following the month of
the Closing Date, or, if such 25th day is not a Business Day, the Business Day immediately following.
DTC: The Depository Trust Company, the nominee of which is Cede & Co., or any successor thereto.
DTC Agreement: The meaning specified in Subsection 4.01(a) hereof.
DTC Custodian: The Grantor Trustee, or its successor in interest as custodian for DTC.
DTC Participant: A broker, dealer, bank or other financial institution or other Person for whom from
time to time DTC effects book-entry transfers and pledges of securities deposited with DTC.
ERISA: The Employee Retirement Income Security Act of 1974, as amended.
▇▇▇▇▇▇ Mae: ▇▇▇▇▇▇ ▇▇▇ (also known as Federal National Mortgage Association) or any successor thereto.
FDIC: Federal Deposit Insurance Corporation or any successor thereto.
Fractional Undivided Interest: With respect to the Certificates, the fractional undivided interest
evidenced by any Certificate, the numerator of which is the Current Principal Amount allocated to such
Certificate and the denominator of which is the aggregate Current Principal Amounts of the Certificates.
▇▇▇▇▇▇▇ Mac: ▇▇▇▇▇▇▇ Mac (also known as the Federal Home Loan Mortgage Corporation) or any successor
thereto.
Grantor Trust Distribution Account: The trust account or accounts created and maintained pursuant to
Section 3.01, which shall be denominated "▇▇▇▇▇ Fargo Bank, National Association, as Grantor Trustee for the
benefit of the holders of Structured Asset Mortgage Investments II Inc., Structured Asset Mortgage Investments II
Grantor Trust 2007-AR4, Mortgage Pass-Through Certificates, Series 2007-AR4 - Grantor Trust Distribution Account."
Grantor Trustee: ▇▇▇▇▇ Fargo Bank, National Association, or its successor in interest, or any successor
grantor trustee appointed as herein provided.
Holder: The Person in whose name a Certificate is registered in the Certificate Register, except that,
subject to Subsections 9.03(b) and 9.06(e), solely for the purpose of giving any consent pursuant to this
Agreement, any Certificate registered in the name of the Depositor or the Grantor Trustee or any Affiliate
thereof shall be deemed not to be outstanding and the Fractional Undivided Interest evidenced thereby shall not
be taken into account in determining whether the requisite percentage of Fractional Undivided Interests necessary
to effect any such consent has been obtained.
Indemnified Persons: The Grantor Trustee and their respective officers, directors, agents and employees
and any separate grantor trustee or co-grantor trustee and their respective officers, directors, agents and
employees.
Independent: When used with respect to any specified Person, this term means that such Person (a) is in
fact independent of the Depositor and of any Affiliate of the Depositor, (b) does not have any direct financial
interest or any material indirect financial interest in the Depositor or any Affiliate of the Depositor and (c)
is not connected with the Depositor or any Affiliate of the Depositor as an officer, employee, promoter,
underwriter, trustee, partner, director or person performing similar functions.
Interest Accrual Period: With respect to the Certificates, the period from and including the preceding
Distribution Date (or, in the case of the first Distribution Date, from the Closing Date) to and including the
day prior to the current Distribution Date. For purposes of clarification, if the Closing Date occurs in a month
that contains thirty one (31) days, the first Interest Accrual Period shall include the 31st day of such month.
LIBOR: LIBOR as determined by the Underlying Trustee pursuant to the Underlying Pooling and Servicing
Agreement.
Moody's: ▇▇▇▇▇'▇ Investors Service, Inc. or its successor in interest.
Non-Mortgage Widely Held Fixed Investment Trust: As such term is defined in Treasury Regulations section
1.671-5(b)(12) or successor provisions.
One-Month LIBOR: One-Month LIBOR as determined by the Underlying Trustee pursuant to the Underlying
Pooling and Servicing Agreement.
Opinion of Counsel: A written opinion of counsel who is or are acceptable to the Grantor Trustee and
who, unless required to be Independent (an "Opinion of Independent Counsel"), may be internal counsel for the
Depositor.
Optional Termination Date: As defined in the Underlying Pooling and Servicing Agreement.
Pass-Through Rate: With respect to the Certificates and any Distribution Date, the least of (i)
One-Month LIBOR plus the related Margin (as defined in the Underlying Pooling and Servicing Agreement), (ii)
11.50% per annum and (iii) the Net Rate Cap (as defined in the Underlying Pooling and Servicing Agreement), in
each case calculated on the basis of a 360-day year and the actual number of days in the related Interest Accrual
Period.
Person: Any individual, corporation, partnership, joint venture, association, limited liability
company, joint-stock company, trust, unincorporated organization or government or any agency or political
subdivision thereof.
Rating Agency: Each of S&P and Moody's.
Record Date: With respect to the Certificates, the Business Day preceding the applicable Distribution
Date.
Responsible Officer: Any officer assigned to the Corporate Trust Office (or any successor thereto),
including any Vice President, Assistant Vice President, Trust Officer, any Assistant Secretary, any trust officer
or any other officer of the Grantor Trustee customarily performing functions similar to those performed by any of
the above designated officers and having direct responsibility for the administration of this Agreement.
S&P: Standard and Poor's Rating Services, a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., and its
successor in interest.
Swap Agreement: The ISDA Master Agreement and related Confirmation, dated as of the Closing Date,
between the Swap Counterparty and the Grantor Trustee with respect to the Underlying Certificates.
Swap Counterparty: Bear ▇▇▇▇▇▇▇ Capital Markets Inc., or any successor swap counterparty appointed in
accordance with the Swap Agreement.
Swap Counterparty Payment: On each Distribution Date, amounts due to the Swap Counterparty pursuant to
the Swap Agreement.
Trust Fund or Trust: The corpus of the trust created by this Agreement, consisting of the Underlying
Certificates, the Swap Agreement and the other assets described in Section 2.01.
Underlying Certificates: The Underlying Class A-4B Certificates issued pursuant to the Underlying
Pooling and Servicing Agreement, a copy of which is attached hereto as Exhibit B.
Underlying Certificates Remittance Report: The remittance report provided to the Holders of the
Underlying Certificates in accordance with Section 6.04 of the Underlying Pooling and Servicing Agreement.
Underlying Interest Shortfalls: Any Underlying Realized Losses and Net Interest Shortfalls (as defined
in the Underlying Pooling and Servicing Agreement) allocated to the Underlying Certificates pursuant to the
Underlying Pooling and Servicing Agreement.
Underlying Mortgage Loans: The Mortgage Loans deposited into the Underlying Trust created by the
Underlying Pooling and Servicing Agreement.
Underlying Pooling and Servicing Agreement: The Pooling and Servicing Agreement dated as of the Closing
Date, by and among Structured Asset Mortgage Investments II Inc., as depositor, ▇▇▇▇▇ Fargo Bank, National
Association, as trustee, and EMC Mortgage Corporation, as servicer and sponsor, attached hereto as Exhibit D.
Underlying Realized Losses: Any Realized Losses on the Mortgage Loans allocated to the Underlying
Certificates pursuant to the Underlying Pooling and Servicing Agreement.
Underlying Trust: The corpus of the trust created by the Underlying Pooling and Servicing Agreement.
Underlying Trustee: ▇▇▇▇▇ Fargo Bank, National Association, as trustee under the Underlying Pooling and
Servicing Agreement, or its successor in interest, or any successor trustee appointed as provided in the
Underlying Pooling and Servicing Agreement.
Widely Held Fixed Investment Trust: As such term is defined in Treasury Regulations section
1.671-5(b)(22) or successor provisions.
Widely Held Fixed Investment Trust Regulations: Treasury Regulations section 1.671-5, as amended.
ARTICLE II
Conveyance of Underlying Certificates;
Original Issuance of Certificates
Section 2.01. CONVEYANCE OF UNDERLYING CERTIFICATES TO GRANTOR TRUSTEE. The Depositor, concurrently
with the execution and delivery hereof, does hereby transfer, convey and assign to the Grantor Trustee, in trust,
for the use and benefit of the Certificateholders and the Swap Counterparty, (i) all the right, title and
interest of the Depositor in and to the Underlying Certificates, (ii) all distributions on the Underlying
Certificates after the Closing Date and (iii) all other assets constituting the Trust Fund.
In connection with such transfer and assignment, the Depositor is causing the delivery of the Underlying
Certificates to the Grantor Trustee.
It is intended by the Depositor that the conveyance of the Depositor's right, title and interest in and
to the Underlying Certificates and all other assets constituting the Trust Fund pursuant to this Agreement shall
constitute, and be construed as, an absolute sale of the Underlying Certificates and the other assets
constituting the Trust Fund by the Depositor to the Grantor Trustee for the benefit of the Certificateholders.
Furthermore, it is not intended by the Depositor that such conveyance be deemed a pledge of the Underlying
Certificates and the other assets constituting the Trust Fund by the Depositor to the Grantor Trustee to secure a
debt or other obligation of the Depositor. However, in the event that, notwithstanding the intent of the
parties, the Underlying Certificates and the other assets constituting the Trust Fund are held to be the property
of the Depositor, or if for any other reason this Agreement is held or deemed to create a security interest in
the Underlying Certificates and the other assets constituting the Trust Fund, then it is intended by the
Depositor as follows: (a) this Agreement shall also be deemed to be a security agreement within the meaning of
Articles 8 and 9 of the Uniform Commercial Code; (b) the conveyance provided for in this Section shall be deemed
to be a grant by the Depositor to the Grantor Trustee of a security interest in all of the Depositor's right,
title and interest in and to the Underlying Certificates, and all amounts payable to the holders of the
Underlying Certificates and all proceeds of the conversion, voluntary or involuntary, of the foregoing into cash,
instruments, securities or other property, including without limitation all amounts from time to time held or
invested in the Grantor Trust Distribution Account, whether in the form of cash, instruments, securities or other
property; (c) the possession by the Grantor Trustee (or its agent, providing that the agent authenticates a
record acknowledging that it holds possession for the benefit of the Grantor Trustee) of the Underlying
Certificates and such other items of property as constitute instruments, money, negotiable documents or chattel
paper shall be deemed to be "possession by the secured party" for purposes of perfecting the security interest
pursuant to Section 9-313 of the Uniform Commercial Code; and (d) notifications to persons holding such property,
and acknowledgments, receipts or confirmations from persons holding such property, shall be deemed to be
notifications to or acknowledgments, receipts or confirmations from, financial intermediaries, bailees or agents
(as applicable) of the Grantor Trustee for the purpose of perfecting such security interest under applicable law.
It is also intended that the Trust Fund be classified (for Federal tax purposes) as a grantor trust under subpart
E, part I of subchapter J of chapter 1 of the Code, of which the Certificateholders are owners, rather than as an
association taxable as a corporation. The powers granted and obligations undertaken in this Agreement shall be
construed so as to further such intent.
Section 2.02. ACCEPTANCE BY GRANTOR TRUSTEE. The Grantor Trustee hereby acknowledges the receipt by
it of the Underlying Certificates and declares that it holds and will hold such Underlying Certificates and all
other assets and documents included in the Trust Fund, in trust, upon the trusts herein set forth, for the
exclusive use and benefit of all present and future Certificateholders in accordance with the terms of this
Agreement.
Section 2.03. SWAP AGREEMENT. On the Closing Date, the Grantor Trustee shall enter into the Swap
Agreement with the Swap Counterparty.
Section 2.04. REPRESENTATIONS AND WARRANTIES CONCERNING THE DEPOSITOR. The Depositor hereby
represents and warrants to the Grantor Trustee as follows:
(i) the Depositor (a) is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware and (b) is qualified and in good standing as a foreign
corporation to do business in each jurisdiction where such qualification is necessary, except where the
failure so to qualify would not reasonably be expected to have a material adverse effect on the
Depositor's business as presently conducted or on the Depositor's ability to enter into this Agreement
and to consummate the transactions contemplated hereby;
(ii) the Depositor has full corporate power to own its property, to carry on its business
as presently conducted and to enter into and perform its obligations under this Agreement;
(iii) the execution and delivery by the Depositor of this Agreement have been duly
authorized by all necessary corporate action on the part of the Depositor; and neither the execution and
delivery of this Agreement, nor the consummation of the transactions herein contemplated, nor compliance
with the provisions hereof, will conflict with or result in a breach of, or constitute a default under,
any of the provisions of any law, governmental rule, regulation, judgment, decree or order binding on
the Depositor or its properties or the articles of incorporation or by-laws of the Depositor, except
those conflicts, breaches or defaults which would not reasonably be expected to have a material adverse
effect on the Depositor's ability to enter into this Agreement and to consummate the transactions
contemplated hereby;
(iv) the execution, delivery and performance by the Depositor of this Agreement and the
consummation of the transactions contemplated hereby do not require the consent or approval of, the
giving of notice to, the registration with, or the taking of any other action in respect of, any state,
federal or other governmental authority or agency, except those consents, approvals, notices,
registrations or other actions as have already been obtained, given or made;
(v) this Agreement has been duly executed and delivered by the Depositor and, assuming due
authorization, execution and delivery by the other parties hereto, constitutes a valid and binding
obligation of the Depositor enforceable against it in accordance with its terms (subject to applicable
bankruptcy and insolvency laws and other similar laws affecting the enforcement of the rights of
creditors generally);
(vi) there are no actions, suits or proceedings pending or, to the knowledge of the
Depositor, threatened against the Depositor, before or by any court, administrative agency, arbitrator
or governmental body (i) with respect to any of the transactions contemplated by this Agreement or
(ii) with respect to any other matter which in the judgment of the Depositor will be determined adversely
to the Depositor and will if determined adversely to the Depositor materially and adversely affect the
Depositor's ability to enter into this Agreement or perform its obligations under this Agreement; and
the Depositor is not in default with respect to any order of any court, administrative agency,
arbitrator or governmental body so as to materially and adversely affect the transactions contemplated
by this Agreement; and
(vii) immediately prior to the transfer and assignment to the Grantor Trustee, each
Underlying Certificate was not subject to an assignment or pledge, and the Depositor had good and
marketable title to and was the sole owner thereof and had full right to transfer and sell such
Underlying Certificate to the Grantor Trustee free and clear of any encumbrance, equity, lien, pledge,
charge, claim or security interest.
ARTICLE III
Accounts
Section 3.01. GRANTOR TRUST DISTRIBUTION ACCOUNT.
(a) The Grantor Trustee shall establish and maintain in the name of the Grantor Trustee, for the
benefit of the Certificateholders, the Grantor Trust Distribution Account as a segregated trust account or
accounts. The Grantor Trustee will deposit in the Grantor Trust Distribution Account any amounts paid to the
Grantor Trust by the Underlying Trust to or with respect to the Underlying Certificates pursuant to the
Underlying Pooling and Servicing Agreement and any amounts paid to the Grantor Trust pursuant to the Swap
Agreement.
(b) All amounts deposited to the Grantor Trust Distribution Account shall be held by the Grantor
Trustee in the name of the Grantor Trustee in trust for the benefit of the Certificateholders in accordance with
the terms and provisions of this Agreement.
(c) The Grantor Trust Distribution Account shall constitute a trust account of the Trust Fund
segregated on the books of the Grantor Trustee and held by the Grantor Trustee in trust in its Corporate Trust
Office, and the Grantor Trust Distribution Account and the funds deposited therein shall not be subject to, and
shall be protected from, all claims, liens, and encumbrances of any creditors or depositors of the Grantor
Trustee (whether made directly, or indirectly through a liquidator or receiver of the Grantor Trustee). The
amount at any time credited to the Grantor Trust Distribution Account shall be uninvested.
Section 3.02. PERMITTED WITHDRAWALS AND TRANSFERS FROM THE GRANTOR TRUST DISTRIBUTION ACCOUNT.
(a) The Grantor Trustee may clear and terminate the Grantor Trust Distribution Account pursuant to
Section 8.01(d) and remove amounts from time to time deposited in error into the Grantor Trust Distribution
Account.
(b) On an ongoing basis, the Grantor Trustee shall withdraw from the Grantor Trust Distribution
Account any expenses, disbursements and advances recoverable by the Grantor Trustee pursuant to Section 7.05 and
any amounts payable as indemnification pursuant to Section 6.01.
(c) On each Distribution Date, the Grantor Trustee shall pay the amount distributable to the Swap
Counterparty and the Holders of the Certificates in accordance with Section 5.01 from Available Funds in the
Grantor Trust Distribution Account.
ARTICLE IV
Certificates
Section 4.01. CERTIFICATES.
(a) DTC, the Depositor and the Grantor Trustee have entered into a Depository Agreement dated as of
August 31, 2007 (the "DTC Agreement"). The Certificates shall at all times remain registered in the name of DTC
or its nominee and at all times: (i) registration of such Certificates may not be transferred by the Grantor
Trustee except to a successor to DTC; (ii) ownership and transfers of registration of such Certificates on the
books of DTC shall be governed by applicable rules established by DTC; (iii) DTC may collect its usual and
customary fees, charges and expenses from its DTC Participants; (iv) the Grantor Trustee shall deal with DTC as
representative of the Certificate Owners for purposes of exercising the rights of Certificateholders under this
Agreement, and requests and directions for, and votes of, such representative shall not be deemed to be
inconsistent if they are made with respect to different Certificate Owners; and (v) the Grantor Trustee may rely
and shall be fully protected in relying upon information furnished by DTC with respect to its DTC Participants.
All transfers by Certificate Owners of the Book-Entry Certificates shall be made in accordance with the
procedures established by the DTC Participant or brokerage firm representing such Certificate Owners. Each DTC
Participant shall only transfer Book-Entry Certificates of Certificate Owners it represents or of brokerage firms
for which it acts as agent in accordance with DTC's normal procedures.
(b) If (i)(A) the Depositor advises the Grantor Trustee in writing that DTC is no longer willing or
able to properly discharge its responsibilities under the DTC Agreement and (B) the Grantor Trustee or the
Depositor is unable to locate a qualified successor within 30 days thereafter or (ii) the Depositor at its option
advises the Grantor Trustee in writing that it elects to terminate the book-entry system through DTC, the Grantor
Trustee shall request that DTC notify all Certificate Owners of the occurrence of any such event and of the
availability of definitive, fully registered Certificates to Certificate Owners requesting the same. Upon
surrender to the Grantor Trustee of the Certificates by DTC, accompanied by registration instructions from DTC
for registration, the Grantor Trustee shall issue and sign the definitive Certificates. Neither of the Depositor
nor the Grantor Trustee shall be liable for any delay in delivery of such instructions and may conclusively rely
on, and shall be protected in relying on, such instructions.
(c) The Certificates shall have the following designation and initial principal amount:
Designation Initial Principal Amount
__________________________________________________________________________________________
A-4B $100,000,000
__________________________________________________________________________________________
The Certificates shall have the Pass-Through Rate as defined herein.
(d) With respect to each Distribution Date, the Certificates shall accrue interest during the
related Interest Accrual Period. Interest on the Certificates shall be calculated on the basis of a 360-day year
and the actual number of days in the related Interest Accrual Period, based upon the Pass-Through Rate set forth
herein and the Current Principal Amount of the Certificates applicable to such Distribution Date.
(e) The Certificates shall be substantially in the form set forth in Exhibit A. On original
issuance, the Grantor Trustee shall sign the Certificates and shall deliver the Certificates at the direction of
the Depositor. Pending the preparation of definitive Certificates, the Grantor Trustee may sign temporary
Certificates that are printed, lithographed or typewritten, in authorized denominations, substantially of the
tenor of the definitive Certificates in lieu of which they are issued and with such appropriate insertions,
omissions, substitutions and other variations as the officers or authorized signatories executing such
Certificates may determine, as evidenced by their execution of such Certificates. If temporary Certificates are
issued, the Depositor will cause definitive Certificates to be prepared without unreasonable delay. After the
preparation of definitive Certificates, the temporary Certificates shall be exchangeable for definitive
Certificates upon surrender of the temporary Certificates at the office of the Grantor Trustee, without charge to
the Holder. Upon surrender for cancellation of any one or more temporary Certificates, the Grantor Trustee shall
sign and shall deliver in exchange therefor, a like aggregate principal amount, in authorized denominations, of
definitive Certificates. Until so exchanged, such temporary Certificates shall in all respects be entitled to
the same benefits as definitive Certificates.
(f) The Book-Entry Certificates will be registered as a single Certificate held by a nominee of DTC
or the DTC Custodian, and beneficial interests will be held by investors through the book-entry facilities of DTC
in minimum denominations of $1,000 and increments of $1.00 in excess thereof. On the Closing Date, the Grantor
Trustee shall execute the Certificate in the entire Current Principal Amount of the Certificates. The Grantor
Trustee shall sign the Certificates by facsimile or manual signature on behalf of the Grantor Trustee by one of
its authorized signatories, who shall be a Responsible Officer of the Grantor Trustee or its agent. A
Certificate bearing the manual or facsimile signature of an individual who was an authorized signatory of the
Grantor Trustee or its agent at the time of issuance shall bind the Grantor Trustee, notwithstanding that such
individual has ceased to hold such position prior to the delivery of such Certificate.
(g) No Certificate shall be entitled to any benefit under this Agreement, or be valid for any
purpose, unless there appears on such Certificate the manually executed signature of the Grantor Trustee, or its
agent, and such signature upon any Certificate shall be conclusive evidence, and the only evidence, that such
Certificate has been duly executed and delivered hereunder. All Certificates issued on the Closing Date shall be
dated the Closing Date. All Certificates issued thereafter shall be dated the date of their signature.
Section 4.02. REGISTRATION OF TRANSFER AND EXCHANGE OF CERTIFICATES.
(a) The Grantor Trustee shall maintain at its Corporate Trust Office a Certificate Register in
which, subject to such reasonable regulations as it may prescribe, the Grantor Trustee shall provide for the
registration of Certificates and of transfers and exchanges of Certificates as herein provided.
(b) Subject to Subsection 4.01(a), upon surrender for registration of transfer of any Certificate
at any office or agency of the Grantor Trustee maintained for such purpose, the Grantor Trustee shall sign and
shall deliver, in the name of the designated transferee or transferees, a new Certificate of a like aggregate
Fractional Undivided Interest, but bearing a different number.
(c) At the option of the Certificateholders, Certificates may be exchanged for other Certificates
of authorized denominations of a like aggregate Fractional Undivided Interest, upon surrender of the Certificates
to be exchanged at any such office or agency; provided, however, that no Certificate may be exchanged for new
Certificates unless the original Fractional Undivided Interest represented by each such new Certificate (i) is at
least equal to the minimum authorized denomination or (ii) is acceptable to the Depositor as indicated to the
Grantor Trustee in writing. Whenever any Certificates are so surrendered for exchange, the Grantor Trustee shall
sign and deliver the Certificates which the Certificateholder making the exchange is entitled to receive.
(d) If the Grantor Trustee so requires, every Certificate presented or surrendered for transfer or
exchange shall be duly endorsed by, or be accompanied by a written instrument of transfer, with a signature
guarantee, in form satisfactory to the Grantor Trustee, duly executed by the holder thereof or his or her
attorney duly authorized in writing.
(e) No service charge shall be made for any transfer or exchange of Certificates, but the Grantor
Trustee may require payment of a sum sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
(f) The Grantor Trustee shall cancel all Certificates surrendered for transfer or exchange but
shall retain such Certificates in accordance with its standard retention policy or for such further time as is
required by the record retention requirements of the Securities Exchange Act of 1934, as amended, and thereafter
may destroy such Certificates.
(g) The following legend shall be placed on the Certificates, whether upon original issuance or
upon issuance of any other Certificate in exchange therefor or upon transfer thereof:
THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR INDIRECTLY BY, OR ON BEHALF OF, AN EMPLOYEE BENEFIT
PLAN OR OTHER RETIREMENT ARRANGEMENT WHICH IS SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED ("ERISA"), AND/OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED, UNLESS THE PURCHASE OF THE CERTIFICATES ON BEHALF OF SUCH PERSON WILL NOT RESULT IN OR
CONSTITUTE A NON-EXEMPT PROHIBITED TRANSACTION UNDER ERISA OR SECTION 4975 OF THE CODE, IS PERMISSIBLE
UNDER APPLICABLE LAW AND WILL NOT GIVE RISE TO ANY OBLIGATIONS ON THE PART OF THE DEPOSITOR, THE
SERVICER, THE UNDERLYING TRUSTEE OR THE GRANTOR TRUSTEE IN ADDITION TO THOSE OBLIGATIONS SET FORTH IN
THE UNDERLYING POOLING AND SERVICING AGREEMENT.
ANY PERSON ACQUIRING AN INTEREST IN A CERTIFICATE, BY ACQUISITION OF SUCH CERTIFICATE, SHALL BE DEEMED
TO HAVE REPRESENTED TO THE GRANTOR TRUSTEE THAT EITHER: (I) IT IS NOT ACQUIRING AN INTEREST IN SUCH
CERTIFICATE DIRECTLY OR INDIRECTLY BY, OR ON BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT WHICH IS SUBJECT TO TITLE I OF ERISA AND/OR SECTION 4975 OF THE CODE, OR (II) THE TRANSFER
AND/OR HOLDING OF AN INTEREST IN SUCH CERTIFICATE TO THAT PERSON AND THE SUBSEQUENT SERVICING,
MANAGEMENT AND/OR OPERATION OF THE TRUST AND ITS ASSETS: (I) WILL NOT RESULT IN ANY PROHIBITED
TRANSACTION WHICH IS NOT COVERED UNDER A STATUTORY OR AN ADMINISTRATIVE INDIVIDUAL OR CLASS PROHIBITED
TRANSACTION EXEMPTION ("PTE"), INCLUDING, BUT NOT LIMITED TO, SECTION 408(B)(17) OF ERISA, ▇▇▇ ▇▇-▇▇,
▇▇▇ ▇▇-▇, ▇▇▇ ▇▇-▇▇, ▇▇▇ 95-60 OR PTE 96-23 AND (II) WILL NOT SUBJECT THE DEPOSITOR, THE SERVICER, THE
UNDERLYING TRUSTEE OR THE GRANTOR TRUSTEE TO ANY OBLIGATION IN ADDITION TO THOSE UNDERTAKEN IN THE
UNDERLYING POOLING AND SERVICING AGREEMENT. THE GRANTOR TRUSTEE WILL NOT BE REQUIRED TO MONITOR,
DETERMINE OR INQUIRE AS TO COMPLIANCE WITH THE FOREGOING TRANSFER RESTRICTIONS AND NONE OF SUCH PERSONS
SHALL HAVE ANY LIABILITY FOR THE TRANSFER OF ANY BOOK-ENTRY CERTIFICATES MADE IN VIOLATION OF THE
TRANSFER RESTRICTIONS SET FORTH IN THE GRANTOR TRUST AGREEMENT.
Section 4.03. MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES.
(a) If (i) any mutilated Certificate is surrendered to the Grantor Trustee, or the Grantor Trustee
receives evidence to its satisfaction of the destruction, loss or theft of any Certificate, and (ii) there is
delivered to the Grantor Trustee such security or indemnity as it may require to save it harmless, and (iii) the
Grantor Trustee has not received notice that such Certificate has been acquired by a third Person, the Grantor
Trustee shall sign and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Certificate, a new Certificate of like tenor and Fractional Undivided Interest but in each case bearing a
different number. The mutilated, destroyed, lost or stolen Certificate shall thereupon be canceled of record by
the Grantor Trustee and shall be of no further effect and evidence no rights.
(b) Upon the issuance of any new Certificate under this Section 4.03, the Grantor may require the
payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto
and any other expenses (including the fees and expenses of the Grantor Trustee) connected therewith. Any
duplicate Certificate issued pursuant to this Section 4.03 shall constitute complete and indefeasible evidence of
ownership in the Trust Fund, as if originally issued, whether or not the lost, stolen or destroyed Certificate
shall be found at any time.
Section 4.04. PERSONS DEEMED OWNERS. Prior to due presentation of a Certificate for registration of
transfer, the Depositor, the Grantor Trustee and any agent of the Depositor or the Grantor Trustee may treat the
Person in whose name any Certificate is registered as the owner of such Certificate for the purpose of receiving
distributions pursuant to Section 5.01 and for all other purposes whatsoever. Neither the Depositor, the Grantor
Trustee, nor any agent of the Depositor or the Grantor Trustee shall be affected by notice to the contrary. No
Certificate shall be deemed duly presented for a transfer effective on any Record Date unless the Certificate to
be transferred is presented no later than the close of business on the third Business Day preceding such Record
Date.
Section 4.05. ERISA RESTRICTIONS.
(a) Subject to the provisions of subsection (b), no Certificates may be acquired directly or
indirectly by, or on behalf of, an employee benefit plan or other retirement arrangement which is subject to
Title I of ERISA and/or Section 4975 of the Code (each, a "Plan"), unless the purchase of such Certificates by or
on behalf of such Plan is permissible under applicable law, will not constitute or result in a non-exempt
prohibited transaction under ERISA or Section 4975 of the Code and will not subject the Depositor, the Servicer,
the Underlying Trustee or the Grantor Trustee to any obligation in addition to those undertaken in the Underlying
Pooling and Servicing Agreement.
(b) Any Person acquiring an interest in a Certificate, by acquisition of such Certificate, shall be
deemed to have represented to the Grantor Trustee that either: (i) it is not acquiring an interest in such
Certificate directly or indirectly by, or on behalf of, an employee benefit plan or other retirement arrangement
which is subject to Title I of ERISA and/or Section 4975 of the Code, or (ii) the transfer and/or holding of an
interest in such Certificate to that Person and the subsequent servicing, management and/or operation of the
Trust and its assets: (I) will not result in any prohibited transaction which is not covered under a statutory or
an administrative individual or class prohibited transaction exemption ("PTE"), including, but not limited to,
Section 408(b)(17) of ▇▇▇▇▇, ▇▇▇ ▇▇-▇▇, ▇▇▇ ▇▇-▇, ▇▇▇ 91-38, PTE 95-60 or PTE 96-23 and (II) will not subject the
Depositor, the Servicer, the Underlying Trustee or the Grantor Trustee to any obligation in addition to those
undertaken in the Underlying Pooling and Servicing Agreement. The Grantor Trustee will not be required to
monitor, determine or inquire as to compliance with the foregoing transfer restrictions and none of such Persons
shall have any liability for the transfer of any Book-Entry Certificates made in violation of the transfer
restrictions set forth herein.
ARTICLE V
Payments to Certificateholders
Section 5.01. DISTRIBUTIONS ON THE CERTIFICATES.
(a) Interest and principal on the Certificates will be distributed monthly on each Distribution
Date, commencing in September 2007, in an aggregate amount equal to the Available Funds for such Distribution
Date.
On each Distribution Date, the Available Funds shall be distributed as follows:
(i) FIRST, to the Swap Counterparty, the Swap Counterparty Payment (if any) and certain
termination payments (as set forth in the Swap Agreement), if applicable, for such Distribution Date
(other than where the Swap Counterparty is the sole defaulting or sole affected party);
(ii) SECOND, to the extent of remaining Available Funds, to the Certificates, the Accrued
Certificate Interest for such Distribution Date;
(iii) THIRD, to the extent of remaining Available Funds, to the Certificates, any principal
distributions received from the Underlying Certificates, in reduction of the Current Principal Amount
thereof, until the Current Principal Amount thereof has been reduced to zero; and
(iv) FOURTH, to the extent of remaining Available Funds, to the Swap Counterparty, any
termination payments (as set forth in the Swap Agreement) where the Swap Counterparty is the sole
defaulting or sole affected party.
(b) No Accrued Certificate Interest will be payable with respect to the Certificates after the
Distribution Date on which the Current Principal Amount of the Certificates has been reduced to zero.
Section 5.02. ALLOCATION OF LOSSES.
(a) On or prior to each Determination Date, the Grantor Trustee, based solely upon information
provided to it and calculations with respect thereto conducted by the Underlying Trustee pursuant to Section 6.04
of the Underlying Pooling and Servicing Agreement, shall determine the amount of any Underlying Realized Losses
on the Mortgage Loans to be allocated to the Underlying Certificates (and, correspondingly, to the Certificates).
(b) With respect to the Certificates on any Distribution Date, the principal portion of the
Underlying Realized Loss allocated to the Underlying Certificates (and, correspondingly, to such Certificates)
shall be allocated to the Certificates, until the Current Principal Amount of the Certificates has been reduced
to zero.
Section 5.03. PAYMENTS.
(a) On each Distribution Date, other than the final Distribution Date, the Grantor Trustee shall
distribute to each Certificateholder of record on the directly preceding Record Date the Certificateholder's pro
rata share (based on the aggregate Fractional Undivided Interest represented by such Holder's Certificates) of
all amounts required to be distributed on such Distribution Date to the Certificates, based solely on information
provided to the Grantor Trustee and calculations with respect thereto conducted by the Underlying Trustee and the
Swap Counterparty. The Grantor Trustee shall not be required to confirm, verify or recompute any such
information but shall be entitled to rely conclusively on such information.
(b) Payment of the above amounts to each Certificateholder shall be made (i) by check mailed to
each Certificateholder entitled thereto at the address appearing in the Certificate Register or (ii) upon receipt
by the Grantor Trustee, on or before the fifth Business Day preceding the related Record Date, of written
instructions from a Certificateholder, by wire transfer to a United States dollar account maintained by the payee
at any United States depository institution with appropriate facilities for receiving such a wire transfer;
provided, however, that the final payment in respect of the Certificates will be made only upon presentation and
surrender of such respective Certificates at the office or agency of the Grantor Trustee specified in the notice
to Certificateholders of such final payment.
Section 5.04. STATEMENTS TO CERTIFICATEHOLDERS.
(a) Concurrently with each distribution to Certificateholders, the Grantor Trustee shall make
available via the Grantor Trustee's internet website as set forth below, all of the information provided to the
Grantor Trustee with respect to the Underlying Certificates pursuant to Section 6.04 of the Underlying Pooling
and Servicing Agreement.
The Grantor Trustee may make available each month, to any interested party, the monthly statement to
Certificateholders via the Grantor Trustee's website initially located at ▇▇▇.▇▇▇▇▇▇▇.▇▇▇. Assistance in using
the website can be obtained by calling the Grantor Trustee's customer service desk at (▇▇▇) ▇▇▇-▇▇▇▇. Parties
that are unable to use the above distribution option are entitled to have a paper copy mailed to them via first
class mail by calling the customer service desk and indicating such. The Grantor Trustee shall have the right to
change the way such reports are distributed in order to make such distribution more convenient and/or more
accessible to the parties, and the Grantor Trustee shall provide timely and adequate written notification to all
parties regarding any such change.
(b) Within a reasonable period of time after the end of the preceding calendar year, beginning in
2008, the Grantor Trustee will furnish such report to each Holder of the Certificates of record at any time
during the prior calendar year as to the aggregate of amounts reported pursuant to subclauses (a)(i) and (a)(ii)
of Section 6.04 of the Underlying Pooling and Servicing Agreement with respect to the Certificates, and at the
request of the Holders, any other amounts which would enable such Holders to prepare their tax returns for such
calendar year. Such obligations shall be deemed to have been satisfied to the extent that substantially
comparable information shall be provided by the Grantor Trustee to such Holders pursuant to the requirements of
the Code.
ARTICLE VI
Indemnification
Section 6.01. INDEMNIFICATION OF THE GRANTOR TRUSTEE. The Trust shall indemnify the Indemnified
Persons for, and will hold them harmless against, any loss, liability or expense incurred on their part, arising
out of, or in connection with, this Agreement, the Swap Agreement and the Certificates, including the costs and
expenses (including reasonable legal fees and expenses) of defending themselves against any such claim other than
(i) any loss, liability or expense related to such Indemnified Person's failure to perform such Indemnified
Person's duties in strict compliance with this Agreement (except as any such loss, liability or expense shall be
otherwise reimbursable pursuant to this Agreement) and (ii) any loss, liability or expense incurred by reason of
such Indemnified Person's willful misfeasance, bad faith or negligence in the performance or non-performance of
duties hereunder or by reason of such Indemnified Person's reckless disregard of obligations and duties
hereunder. Any amounts payable to an Indemnified Person as set forth herein shall be paid by the Grantor Trustee
to such Indemnified Person from the Grantor Trust Distribution Account. This indemnity shall survive the
resignation or removal of the Grantor Trustee and the termination of this Agreement.
ARTICLE VII
Concerning the Grantor Trustee
Section 7.01. DUTIES OF THE GRANTOR TRUSTEE.
(a) The Grantor Trustee undertakes to perform such duties and only such duties as are specifically
set forth in this Agreement as duties of the Grantor Trustee.
(b) Upon receipt of all resolutions, certificates, statements, opinions, reports, documents, orders
or other instruments which are specifically required to be furnished to the Grantor Trustee pursuant to any
provision of this Agreement, the Grantor Trustee shall examine them to determine whether they are in the form
required by this Agreement; provided, however, that the Grantor Trustee shall not be responsible for the accuracy
or verification of any calculation provided to it pursuant to this Agreement.
(c) On each Distribution Date, the Grantor Trustee shall make monthly distributions and the final
distribution to the Certificateholders from Available Funds in the Grantor Trust Distribution Account as provided
in Section 5.01 herein based on a report prepared by the Underlying Trustee with respect to such distributions.
(d) No provision of this Agreement shall be construed to relieve the Grantor Trustee from liability
for its own negligent action, its own negligent failure to act or its own willful misconduct; provided, however,
that:
(i) The duties and obligations of the Grantor Trustee shall be determined solely by the
express provisions of this Agreement, the Grantor Trustee shall not be liable except for the performance
of its duties and obligations as are specifically set forth in this Agreement, no implied covenants or
obligations shall be read into this Agreement against the Grantor Trustee and, in the absence of bad
faith on the part of the Grantor Trustee, the Grantor Trustee may conclusively rely, as to the truth of
the statements and the correctness of the opinions expressed therein, upon any certificates or opinions
furnished to the Grantor Trustee and conforming to the requirements of this Agreement;
(ii) The Grantor Trustee shall not be liable in its individual capacity for an error of
judgment made in good faith by a Responsible Officer or Responsible Officers of the Grantor Trustee
unless it shall be proved that the Grantor Trustee was negligent in ascertaining the pertinent facts;
(iii) The Grantor Trustee shall not be liable with respect to any action taken, suffered or
omitted to be taken by it in good faith in accordance with the directions of the Holders of Certificates
evidencing Fractional Undivided Interests aggregating not less than 25% of the Trust Fund, if such
action or non-action relates to the time, method and place of conducting any proceeding for any remedy
available to the Grantor Trustee or exercising any trust or other power conferred upon the Grantor
Trustee under this Agreement;
(iv) The Grantor Trustee shall not in any way be liable by reason of any insufficiency in
the Grantor Trust Distribution Account unless it is determined by a court of competent jurisdiction that
the Grantor Trustee's negligence, negligent failure to act or willful misconduct was the primary cause
of such insufficiency (except to the extent that the Grantor Trustee is obligor and has defaulted
thereon); and
(v) Anything in this Agreement to the contrary notwithstanding, in no event shall the
Grantor Trustee be liable for special, indirect or consequential loss or damage of any kind whatsoever
(including but not limited to lost profits), even if the Grantor Trustee has been advised of the
likelihood of such loss or damage and regardless of the form of action.
The Grantor Trustee shall not be required to expend or risk its own funds or otherwise incur financial
liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers,
if there is reasonable ground for believing that the repayment of such funds or adequate indemnity against such
risk or liability is not reasonably assured to it.
(e) All funds received by the Grantor Trustee and required to be deposited in the Grantor Trust
Distribution Account pursuant to this Agreement will be promptly so deposited by the Grantor Trustee.
(f) Except for those actions that the Grantor Trustee is required expressly to take hereunder, the
Grantor Trustee shall not have any obligation or liability to take any action or to refrain from taking any
action hereunder in the absence of written direction as provided hereunder.
(g) The Grantor Trustee hereby acknowledges and agrees to reasonably cooperate with the Underlying
Trustee and the Depositor in facilitating compliance by such parties with the provisions of Regulation AB and
related rules and regulations of the Commission, including any filings required thereby. The Grantor
Trustee acknowledges that interpretations of the requirements of the requirements of Regulation AB may change over
time, whether due to interpretive guidance provided by the Commission or its staff, consensus among participants
in the mortgage-backed securities markets, advice of counsel, or otherwise, and agrees to comply with requests
made by the Underlying Trustee and the Depositor in good faith for delivery of information on the basis of
evolving interpretations of Regulation AB to the extent reasonably practicable. The Grantor Trustee shall
cooperate reasonably with the Underlying Trustee and the Depositor to deliver to such parties (including any of
their respective assignees or designees), any and all disclosure, statements, reports, certifications, records
and any other information necessary in the reasonable, good faith determination of the Underlying Trustee and the
Depositor to permit the Underlying Trustee and the Depositor to comply with the provisions of Regulation AB.
(h) The standard of care owed by the Grantor Trustee to the Certificateholders under this Agreement
shall be the same standard of care owed by the Grantor Trustee to the Swap Counterparty with respect to the Swap
Counterparty's rights under this Agreement and the Swap Agreement and the Swap Counterparty shall be entitled to
the same benefits and limitations of the Certificateholders described in this Agreement and under the Swap
Agreement. In addition, the Grantor Trustee, in its capacity as Trustee under the Underlying Pooling and
Servicing Agreement, hereby agrees that the standard of care owed by the Trustee to the Holders of the Underlying
Certificates under the Underlying Pooling and Servicing Agreement shall be the same standard of care owed by the
Trustee to the Swap Counterparty with respect to the Swap Counterparty's rights under the Underlying Pooling and
Servicing Agreement, this Agreement and the Swap Agreement (if any) and the Swap Counterparty shall be entitled
to the same benefits and limitations of the Holders of the Underlying Certificates under the Underlying Pooling
and Servicing Agreement, this Agreement and the Swap Agreement (if any).
Section 7.02. CERTAIN MATTERS AFFECTING THE GRANTOR TRUSTEE.
Except as otherwise provided in Section 7.01:
(i) The Grantor Trustee may rely and shall be protected in acting or refraining from
acting in reliance on any resolution, certificate of the Depositor, the Servicer or the Underlying
Trustee, any certificate of auditors or any other certificate, statement, instrument, opinion, report,
notice, request, consent, order, appraisal, bond or other paper or document believed by it to be genuine
and to have been signed or presented by the proper party or parties;
(ii) The Grantor Trustee may consult with counsel and any written advice of such counsel or
any Opinion of Counsel shall be full and complete authorization and protection with respect to any
action taken or suffered or omitted by it hereunder in good faith and in accordance with such written
advice or Opinion of Counsel;
(iii) The Grantor Trustee shall not be under any obligation to exercise any of the trusts or
powers vested in it by this Agreement, other than its obligation to give notices pursuant to this
Agreement, and shall not be under any obligation to institute, conduct or defend any litigation
hereunder or in relation hereto at the request, order or direction of any of the Certificateholders
pursuant to the provisions of this Agreement, unless such Certificateholders shall have offered to the
Grantor Trustee reasonable security or indemnity against the costs, expenses and liabilities which may
be incurred therein or thereby;
(iv) The Grantor Trustee shall not be liable in its individual capacity for any action
taken, suffered or omitted by it in good faith and believed by it to be authorized or within the
discretion or rights or powers conferred upon it by this Agreement;
(v) The Grantor Trustee shall not be bound to make any investigation into the facts or
matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request,
consent, order, approval, bond or other paper or document, unless requested in writing to do so by
Holders of Certificates evidencing Fractional Undivided Interests aggregating not less than 25% of the
Trust Fund and provided that the payment within a reasonable time to the Grantor Trustee of the costs,
expenses or liabilities likely to be incurred by it in the making of such investigation is, in the
opinion of the Grantor Trustee, reasonably assured to the Grantor Trustee by the security afforded to it
by the terms of this Agreement. The Grantor Trustee may require reasonable indemnity against such
expense or liability as a condition to taking any such action. The reasonable expense of every such
examination shall be paid pro rata by the Certificateholders requesting the investigation;
(vi) The Grantor Trustee may (to the extent it is authorized hereunder to so execute or
perform) execute any of the trusts or powers hereunder or perform any duties hereunder either directly
or through its Affiliates, agents or attorneys. The Grantor Trustee shall not be liable or responsible
for the misconduct or negligence of any agent or attorney of the Grantor Trustee appointed hereunder by
the Grantor Trustee with due care;
(vii) Should the Grantor Trustee deem the nature of any action required on its part, other
than a payment or transfer under Section 3.02 or Section 5.01, to be unclear, the Grantor Trustee may
require prior to such action that it be provided by the Depositor with reasonable further instructions;
(viii) The right of the Grantor Trustee to perform any discretionary act enumerated in this
Agreement shall not be construed as a duty, and the Grantor Trustee shall not be accountable for other
than its negligence, bad faith, negligent failure to act or willful misconduct in the performance of any
such act; and
(ix) The Grantor Trustee shall not be required to give any bond or surety with respect to
the execution of the trust created hereby or the powers granted hereunder, except as provided in Section
7.07.
Section 7.03. GRANTOR TRUSTEE NOT LIABLE FOR CERTIFICATES OR MORTGAGE LOANS. The recitals contained
herein and in the Certificates (other than the signature of the Grantor Trustee on the Certificates) shall be
taken as the statements of the Depositor, and the Grantor Trustee shall not have any responsibility for their
correctness. The Grantor Trustee does not make any representation as to the validity or sufficiency of the
Certificates (other than the signature of the Grantor Trustee on the Certificates). The Grantor Trustee's
signature on the Certificates shall be solely in its capacity as Grantor Trustee, and shall not constitute the
Certificates an obligation of the Grantor Trustee in any other capacity. The Grantor Trustee shall not be
accountable for the use or application by the Depositor of any of the Certificates or of the proceeds of such
Certificates, or for the use or application of any funds paid to the Depositor with respect to the Underlying
Certificates. The Grantor Trustee shall not be responsible for the legality, sufficiency or validity of this
Agreement, the Swap Agreement or any document or instrument relating to this Agreement, the validity of the
execution of this Agreement or of any supplement hereto or instrument of further assurance by any Person other
than it, or the validity, priority, perfection or sufficiency of the security for the Certificates issued
hereunder or intended to be issued hereunder. The Grantor Trustee shall not at any time have any responsibility
or liability for or with respect to the legality, validity and enforceability of any Mortgage or any Mortgage
Loan, or the perfection and priority of any Mortgage or the maintenance of any such perfection and priority, or
for or with respect to the sufficiency of the Trust Fund or its ability to generate the payments to be
distributed to Certificateholders under this Agreement. The Grantor Trustee shall not have any responsibility
for filing any financing or continuation statement in any public office at any time or to otherwise perfect or
maintain the perfection of any security interest or lien granted to it hereunder or to record this Agreement.
Section 7.04. GRANTOR TRUSTEE MAY OWN CERTIFICATES. The Grantor Trustee, in its individual capacity
or in any capacity other than as Grantor Trustee hereunder, may become the owner or pledgee of any Certificates
with the same rights it would have if it were not Grantor Trustee and may otherwise deal with the parties hereto.
Section 7.05. EXPENSES. The Grantor Trustee and any director, officer, employee or agent of such
party, will be entitled to recover from the Grantor Trust Distribution Account pursuant to Section 3.02(b) all
reasonable out- of-pocket expenses, disbursements and advances of such party in connection with any event of
default or breach of this Agreement or any claim or legal action (including any pending or threatened claim or
legal action) incurred or made by such party in the administration of the trusts hereunder (including the
reasonable compensation, expenses and disbursements of its counsel) except any such expense, disbursement or
advance as may arise from its negligence, negligent failure to act, or intentional misconduct or which is the
responsibility of the Certificateholders or the Trust Fund hereunder. If funds in the Grantor Trust Distribution
Account are insufficient therefor, such party shall recover such expenses, disbursements and advances from the
Depositor. Such compensation and reimbursement obligation shall not be limited by any provision of law in regard
to the compensation of a trustee of an express trust.
Section 7.06. ELIGIBILITY REQUIREMENTS FOR GRANTOR TRUSTEE. The Grantor Trustee, and any successor
Grantor Trustee, shall during the entire duration of this Agreement be a state bank or trust company or a
national banking association organized and doing business under the laws of such state or the United States of
America, authorized under such laws to exercise corporate trust powers, having a combined capital and surplus and
undivided profits of at least $40,000,000 or, in the case of a successor Grantor Trustee, $50,000,000, subject to
supervision or examination by federal or state authority and rated "BBB" or higher by Standard & Poor's and
"Baa2" or higher by Moody's with respect to any outstanding long-term unsecured unsubordinated debt, and, in the
case of a successor Grantor Trustee other than pursuant to Section 7.10, rated in one of the two highest
long-term debt categories of, or otherwise acceptable to, each of the Rating Agencies. If the Grantor Trustee
publishes reports of condition at least annually, pursuant to law or to the requirements of the aforesaid
supervising or examining authority, then for the purposes of this Section 7.06 the combined capital and surplus
of such corporation shall be deemed to be its total equity capital (combined capital and surplus) as set forth in
its most recent report of condition so published. In case at any time the Grantor Trustee shall cease to be
eligible in accordance with the provisions of this Section 7.06, the Grantor Trustee shall resign immediately in
the manner and with the effect specified in Section 7.08.
Section 7.07. INSURANCE. The Grantor Trustee, at its own expense, shall at all times maintain and
keep in full force and effect: (i) fidelity insurance, (ii) theft of documents insurance and (iii) forgery
insurance (which may be collectively satisfied by a "Financial Institution Bond" and/or a "Bankers' Blanket
Bond"). All such insurance shall be in amounts, with standard coverage and subject to deductibles, as are
customary for insurance typically maintained by banks or their affiliates which act as custodians for
investor-owned mortgage pools. A certificate of an officer of the Grantor Trustee as to such party's compliance
with this Section 7.07 shall be furnished to any Certificateholder upon reasonable written request.
Section 7.08. RESIGNATION AND REMOVAL OF THE GRANTOR TRUSTEE.
(a) Subject to the terms of this Agreement, the Grantor Trustee may at any time resign and be
discharged from the Trust hereby created by giving written notice thereof to the Depositor and the Swap
Counterparty, with a copy to the Rating Agencies. Upon receiving such notice of resignation, the Depositor shall
promptly appoint a successor Grantor Trustee, by written instrument, in triplicate, one copy of which instrument
shall be delivered to each of the resigning Grantor Trustee and the successor Grantor Trustee. If no successor
Grantor Trustee shall have been so appointed and have accepted appointment within 30 days after the giving of
such notice of resignation, the resigning Grantor Trustee may assign its duties and obligations hereunder to a
Person who satisfies the requirements of Section 7.06 or may petition any court of competent jurisdiction for the
appointment of a successor Grantor Trustee. The Grantor Trustee may resign hereunder unless it shall also resign
as Underlying Trustee under the Underlying Pooling and Servicing Agreement.
(b) If at any time the Grantor Trustee shall cease to be eligible in accordance with the provisions
of Section 7.06 and shall fail to resign after written request therefor by the Depositor, or if at any time the
Grantor Trustee shall become incapable of acting, or shall be adjudged a bankrupt or insolvent, or a receiver of
the Grantor Trustee or of its property shall be appointed, or any public officer shall take charge or control of
the Grantor Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation,
then the Depositor shall promptly remove the Grantor Trustee and appoint a successor Grantor Trustee by written
instrument, in triplicate, one copy of which instrument shall be delivered to the Grantor Trustee so removed and
one copy of which instrument shall be delivered to the successor Grantor Trustee so appointed.
(c) The Holders of Certificates evidencing Fractional Undivided Interests aggregating not less than
51% of the Trust Fund may at any time remove the Grantor Trustee and appoint a successor Grantor Trustee by
written instrument or instruments, in quadruplicate, signed by such Holders or their attorneys-in-fact duly
authorized, one complete set of which instruments shall be delivered to the Depositor and such party so removed
and one copy of which instrument shall be delivered to the successor so appointed.
(d) No resignation or removal of the Grantor Trustee and appointment of a successor Grantor Trustee
pursuant to any of the provisions of this Section 7.08 shall become effective except upon appointment of and
acceptance of such appointment by the successor Grantor Trustee as provided in Section 7.09.
Section 7.09. SUCCESSOR GRANTOR TRUSTEE.
(a) Any successor Grantor Trustee appointed as provided in Section 7.08 shall execute, acknowledge
and deliver to the Depositor and to its predecessor Grantor Trustee an instrument accepting such appointment
hereunder. The resignation or removal of the predecessor Grantor Trustee shall then become effective and such
successor Grantor Trustee without any further act, deed or conveyance, shall become fully vested with all the
rights, powers, duties and obligations of its predecessor hereunder and the Swap Counterparty, with like effect
as if originally named as Grantor Trustee herein. The predecessor Grantor Trustee shall, after its receipt of
payment of its outstanding fees and expenses, promptly deliver to the successor Grantor Trustee all assets and
records of the Trust held by it hereunder, and the Depositor and the predecessor Grantor Trustee shall execute
and deliver such instruments and do such other things as may reasonably be required for more fully and certainly
vesting and confirming in the successor Grantor Trustee all such rights, powers, duties and obligations.
(b) No successor Grantor Trustee shall accept appointment as provided in this Section 7.09 unless
at the time of such acceptance such successor Grantor Trustee shall be eligible under the provisions of Section
7.06.
(c) Upon acceptance of appointment by a successor Grantor Trustee as provided in this Section 7.09,
the successor Grantor Trustee shall mail notice of the succession of such Grantor Trustee hereunder to all
Certificateholders at their addresses as shown in the Certificate Register, to the Swap Counterparty and to the
Rating Agencies.
Section 7.10. MERGER OR CONSOLIDATION OF GRANTOR TRUSTEE. Any state bank or trust company or
national banking association into which the Grantor Trustee may be merged or converted or with which it may be
consolidated, or any state bank or trust company or national banking association resulting from any merger,
conversion or consolidation to which the Grantor Trustee shall be a party, or any state bank or trust company or
national banking association succeeding to all or substantially all of the corporate business of the Grantor
Trustee shall be the successor of the Grantor Trustee hereunder, provided such state bank or trust company or
national banking association shall be eligible under the provisions of Section 7.06. Such succession shall be
valid without the execution or filing of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding.
Section 7.11. APPOINTMENT OF CO-GRANTOR TRUSTEE OR SEPARATE GRANTOR TRUSTEE.
(a) Notwithstanding any other provisions hereof, at any time, for the purpose of meeting any legal
requirements of any jurisdiction in which any part of the Trust or property constituting the same may at the time
be located, the Depositor and the Grantor Trustee acting jointly shall have the power and shall execute and
deliver all instruments to appoint one or more Persons approved by the Grantor Trustee and the Depositor to act
as co-grantor trustee or co-grantor trustees, jointly with the Grantor Trustee, or separate grantor trustee or
separate grantor trustees, of all or any part of the Trust, and to vest in such Person or Persons, in such
capacity, such title to the Trust, or any part thereof, and, subject to the other provisions of this Section
7.11, such powers, duties, obligations, rights and trusts as the Depositor and the Grantor Trustee may consider
necessary or desirable.
(b) If the Depositor shall not have joined in such appointment within 15 days after the receipt by
it of a written request so to do, the Grantor Trustee shall have the power to make such appointment without any
action by or consent of the Depositor.
(c) No co-grantor trustee or separate grantor trustee hereunder shall be required to meet the terms
of eligibility as a successor Grantor Trustee under Section 7.06 hereunder and no notice to Certificateholders of
the appointment of co-grantor trustee(s) or separate grantor trustee(s) shall be required under Section 7.08
hereof.
(d) In the case of any appointment of a co-grantor trustee or separate grantor trustee pursuant to
this Section 7.11, all rights, powers, duties and obligations conferred or imposed upon the Grantor Trustee and
required to be conferred on such co-grantor trustee shall be conferred or imposed upon and exercised or performed
by the Grantor Trustee and such separate grantor trustee or co-grantor trustee jointly, except to the extent that
under any law of any jurisdiction in which any particular act or acts are to be performed, the Grantor Trustee
shall be incompetent or unqualified to perform such act or acts, in which event such rights, powers, duties and
obligations (including the holding of title to the Trust or any portion thereof in any such jurisdiction) shall
be exercised and performed by such separate grantor trustee or co-grantor trustee at the direction of the Grantor
Trustee.
(e) Any notice, request or other writing given to the Grantor Trustee shall be deemed to have been
given to each of the then separate grantor trustees and co-grantor trustees, as effectively as if given to each
of them. Every instrument appointing any separate grantor trustee or co-grantor trustee shall refer to this
Agreement and the conditions of this Article VII. Each separate grantor trustee and co-grantor trustee, upon its
acceptance of the trusts conferred, shall be vested with the estates or property specified in its instrument of
appointment, either jointly with the Grantor Trustee or separately, as may be provided therein, subject to all
the provisions of this Agreement, specifically including every provision of this Agreement relating to the
conduct of, affecting the liability of, or affording protection to, the Grantor Trustee. Every such instrument
shall be filed with the Grantor Trustee.
(f) To the extent not prohibited by law, any separate grantor trustee or co-grantor trustee may, at
any time, request the Grantor Trustee, its agent or attorney-in-fact, with full power and authority, to do any
lawful act under or with respect to this Agreement on its behalf and in its name. If any separate grantor
trustee or co-grantor trustee shall die, become incapable of acting, resign or be removed, all of its estates,
properties rights, remedies and trusts shall vest in and be exercised by the Grantor Trustee, to the extent
permitted by law, without the appointment of a new or successor Grantor Trustee.
(g) No grantor trustee under this Agreement shall be personally liable by reason of any act or
omission of another grantor trustee under this Agreement. The Depositor and the Grantor Trustee acting jointly
may at any time accept the resignation of or remove any separate grantor trustee or co-grantor trustee.
Section 7.12. FEDERAL INFORMATION RETURNS AND REPORTS TO CERTIFICATEHOLDERS; GRANTOR TRUST
ADMINISTRATION.
(a) The Grantor Trustee shall perform its obligations relating to the Trust in a manner so as to
maintain the status of the Trust Fund as a grantor trust under subpart E, part I of subchapter J of chapter 1 of
the Code and not as an association taxable as a corporation, as a taxable mortgage pool, or as a partnership and
to prevent the imposition of any federal, state or local income or other tax on the Trust Fund.
(i) The Trust is a Widely Held Fixed Investment Trust that is a Non-Mortgage Widely Held
Fixed Investment Trust. The Grantor Trustee will report as required under the Widely Held Fixed
Investment Trust Regulations to the extent such information as is reasonably necessary to enable the
Grantor Trustee to do so, and is not in its possession, is provided to the Grantor Trustee on a timely
basis. The Grantor Trustee is hereby directed to assume that DTC is the only "middleman" (as such term
is defined in the Widely Held Fixed Investment Trust Regulations) unless the Depositor provides the
Grantor Trustee with the identities of other "middlemen" that are Certificateholders. The Grantor
Trustee will not be liable for any tax reporting penalties that may arise under the Widely Held Fixed
Investment Trust Regulations as a result of the Depositor incorrectly determining the status of the
Grantor Trust as a Widely Held Fixed Investment Trust or failing to identify whether or not the Grantor
Trust is a Widely Held Fixed Investment Trust..
(ii) The Grantor Trustee, in its discretion, will report required Widely Held Fixed
Investment Trust information using either the cash or accrual method, except to the extent the Widely Held Fixed
Investment Trust Regulations specifically require a different method. The Grantor Trustee will be under no
obligation to determine whether any interest holder in the Trust uses the cash or accrual method. The Grantor
Trustee will make available Widely Held Fixed Investment Trust information to holders annually. In addition, the
Grantor Trustee will not be responsible or liable for providing subsequently amended, revised or updated
information to any interest holder in the Trust, unless requested by such holder.
(iii) The Grantor Trustee shall not be liable for failure to meet the reporting requirements
of the Widely Held Fixed Investment Trust Regulations nor for any penalties thereunder if such failure is due to:
(i) the lack of reasonably necessary information being provided to the Grantor Trustee, (ii) incomplete,
inaccurate or untimely information being provided to the Grantor Trustee or (iii) the inability of the Grantor
Trustee, after good faith efforts, to alter its existing information reporting systems to capture information
necessary to fully comply with the Widely Held Fixed Investment Trust Regulations for the 2007 calendar year.
Each Certificate holder, by acceptance of its interest in its Certificate, will be deemed to have agreed to
provide the Grantor Trustee with information regarding any sale of such Certificate, including the price, amount
of proceeds and date of sale. Absent receipt of such information, and unless informed otherwise by the
Depositor, the Grantor Trustee will assume there is no secondary market trading of Widely Held Fixed Investment
Trust interests.
(iv) To the extent required by the Widely Held Fixed Investment Trust Regulations, the
Grantor Trustee will use reasonable efforts to publish on an appropriate website the CUSIPs for the
Certificates. The CUSIPs so published will represent the Rule 144A CUSIPs. The Grantor Trustee will not publish
any associated Regulation S CUSIPs. The Grantor Trustee will make reasonable good faith efforts to keep the
website accurate and updated to the extent CUSIPs have been received. Absent the receipt of a CUSIP, the Grantor
Trustee will use a reasonable identifier number in lieu of a CUSIP. The Grantor Trustee will not be liable for
investor reporting delays that result from the receipt of inaccurate or untimely CUSIP information.
(v) The Grantor Trustee shall be entitled to additional reasonable compensation for
changes in reporting required in respect of (i) the failure of the Depositor to timely inform the Grantor Trustee
of the designation of the Grantor Trust as a Widely Held Fixed Investment or (ii) a change in the Widely Held
Fixed Investment Trust Regulations or a change in interpretation of the Widely Held Fixed Investment Trust
Regulations by the IRS or the Depositor or its counsel, if such change requires, in the Grantor Trustee's
reasonable discretion, a material increase in the Grantor Trustee's reporting obligations in respect of the
Grantor Trust.
(b) Notwithstanding any other provisions of this Agreement, the Grantor Trustee shall comply with
all federal withholding requirements with respect to payments to Certificateholders. The consent of
Certificateholders shall not be required for any such withholding. In the event the Grantor Trustee, based
solely on instructions from such Certificateholder or other Person, withholds any amount from any
Certificateholder pursuant to federal withholdings requirements, the Grantor Trustee shall indicate to such
Certificateholder the amount so withheld.
(c) The Grantor Trustee agrees to indemnify the Trust Fund and the Depositor for any taxes and
costs including, without limitation, any reasonable attorneys fees imposed on or incurred by the Trust Fund or
the Depositor as a result of a breach of the Grantor Trustee's obligations set forth in this Section 7.12.
ARTICLE VIII
Termination
Section 8.01. TERMINATION UPON REPURCHASE BY THE DEPOSITOR OR ITS DESIGNEE OR LIQUIDATION OF THE
MORTGAGE LOANS.
(a) The respective obligations and responsibilities of the Depositor and the Grantor Trustee
created hereby, other than the obligation of the Grantor Trustee to make payments to Certificateholders as
hereinafter set forth, shall terminate upon the termination of the Underlying Pooling and Servicing Agreement or
upon the making of the final payment or other liquidation of each of the Underlying Certificates, or any advance
with respect thereto.
(b) In no event, however, shall the Trust created hereby continue beyond the expiration of 21 years
from the death of the last survivor of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the late Ambassador of the United
States to the Court of St. James's, living on the date of this Agreement.
(c) The Grantor Trustee shall give notice of any termination of the Trust to the Certificateholders
and the Swap Counterparty, with a copy to the Rating Agencies, upon which the Certificateholders shall surrender
their Certificates to the Grantor Trustee for payment by the Grantor Trustee of the final distribution and
cancellation with respect thereto. Such notice shall be given by letter, mailed not later than the 20th day of
the month of such final distribution, and shall specify (i) the Distribution Date upon which final payment of the
Certificates will be made upon presentation and surrender of the Certificates at the office of the Grantor
Trustee therein designated, (ii) the amount of any such final payment and (iii) that the Record Date otherwise
applicable to such Distribution Date is not applicable, payments being made by the Grantor Trustee only upon
presentation and surrender of the Certificates at the office of the Grantor Trustee therein specified.
(d) Upon the presentation and surrender of the Certificates, the Grantor Trustee shall distribute
to the remaining Certificateholders, in accordance with their respective interests and based solely upon
information provided to it by the Underlying Trustee and calculations conducted by the Underlying Trustee with
respect thereto, all Available Funds remaining in the Grantor Trust Distribution Account.
(e) If not all of the Certificateholders shall surrender their Certificates for cancellation within
six months after the time specified in the above-mentioned written notice, then the Grantor Trustee shall give a
second written notice to the remaining Certificateholders to surrender their Certificates for cancellation and
receive the final distribution with respect thereto. If, within six months after the second notice, not all the
Certificates shall have been surrendered for cancellation, then the Grantor Trustee may take appropriate steps,
or appoint any agent to take appropriate steps, to contact the remaining Certificateholders concerning surrender
of their Certificates, and the cost thereof shall be paid out of the funds and other assets which remain subject
to this Agreement.
ARTICLE IX
Miscellaneous Provisions
Section 9.01. INTENT OF PARTIES. The parties intend that the Trust Fund shall be treated as a
grantor trust for federal income tax purposes and that the provisions of this Agreement should be construed in
furtherance of this intent.
Section 9.02. ACTION UNDER UNDERLYING DOCUMENTS. In the event that there are any matters arising
under the Underlying Pooling and Servicing Agreement related to an Underlying Certificate which require the vote
or direction of holders of the Underlying Certificates thereunder, the Grantor Trustee, as holder of the
Underlying Certificates will vote such Underlying Certificate in accordance with the written instructions
received from holders of the Certificates evidencing at least 51% of the Fractional Undivided Interest of the
Certificates. In the absence of any such instructions, the Grantor Trustee will not vote such Underlying
Certificates.
Upon written request, the Grantor Trustee will forward to the Certificateholders copies of any
communications received regarding matters arising that require action by holders of the Underlying Certificates.
Section 9.03. AMENDMENT.
(a) This Agreement may be amended from time to time by the Depositor and the Grantor Trustee
without the consent of the Swap Counterparty (other than with respect to any amendment hereto that materially and
adversely affects the rights of the Swap Counterparty hereunder, which amendment shall require the consent of the
Swap Counterparty) and without notice to or the consent of any of the Certificateholders, (i) to cure any
ambiguity, (ii) to correct or supplement any provisions herein that may be defective or inconsistent with any
other provisions herein, (iii) to conform the terms hereof to the disclosure in the Prospectus or the Prospectus
Supplement (as each such term is defined in the Underlying Pooling and Servicing Agreement), (iv) to comply with
any changes in the Code or (v) to make any other provisions with respect to matters or questions arising under
this Agreement which shall not be inconsistent with the provisions of this Agreement; provided, however, that,
with regard to clauses (iv) and (v) of this Section 9.03(a), such action shall not, as evidenced by an Opinion of
Independent Counsel, adversely affect in any material respect the interests of any Certificateholder.
(b) This Agreement may also be amended from time to time by the Depositor and Grantor Trustee with
the consent of the Holders of Certificates evidencing Fractional Undivided Interests aggregating not less than
51% of the Trust Fund, for the purpose of adding any provisions to or changing in any manner or eliminating any
of the provisions of this Agreement or of modifying in any manner the rights of the Certificateholders; provided,
however, that no such amendment shall (i) reduce in any manner the amount of, or delay the timing of, payments
received on Mortgage Loans which are required to be distributed on any Certificate, without the consent of the
Holder of such Certificate, (ii) reduce the aforesaid percentage of Certificates the Holders of which are
required to consent to any such amendment, without the consent of the Holders of all Certificates then
outstanding, or (iii) result in the imposition of a tax on the Trust Fund or cause the Trust Fund to fail to be
classified as a grantor trust under subpart E, part I of subchapter J of chapter 1 of the Code, as evidenced by
an Opinion of Counsel which shall be provided to the Grantor Trustee other than at the Grantor Trustee's
expense. Notwithstanding any other provision of this Agreement, for purposes of the giving or withholding of
consents pursuant to this Section 9.03(b), Certificates registered in the name of or held for the benefit of the
Depositor, the Grantor Trustee or any Affiliate thereof or nominee thereof shall be entitled to vote their
Fractional Undivided Interests with respect to matters affecting such Certificates.
(c) Promptly after the execution of any such amendment, the Grantor Trustee shall furnish a copy of
such amendment or written notification of the substance of such amendment to the Swap Counterparty and each
Certificateholder, with a copy to the Rating Agencies.
(d) In the case of an amendment under Section 9.03(b) above, it shall not be necessary for the
Certificateholders to approve the particular form of such an amendment. Rather, it shall be sufficient if the
Certificateholders approve the substance of the amendment. The manner of obtaining such consents and of
evidencing the authorization of the execution thereof by Certificateholders shall be subject to such reasonable
regulations as the Grantor Trustee may prescribe.
(e) Prior to the execution of any amendment to this Agreement, the parties hereto shall be entitled
to receive and rely upon an Opinion of Counsel stating that the execution of such amendment is authorized or
permitted by this Agreement. The parties hereto may, but shall not be obligated to, enter into any such
amendment which affects such parties' respective rights, duties or immunities under this Agreement.
Section 9.04. RECORDATION OF AGREEMENT. To the extent permitted by applicable law, this Agreement
is subject to recordation in all appropriate public offices for real property records in all the counties or
other comparable jurisdictions in which any or all of the Mortgaged Properties are situated, and in any other
appropriate public recording office or elsewhere. The Depositor shall effect such recordation, at the expense of
the Trust and upon the request in writing of a Certificateholder, but only if such direction is accompanied by an
Opinion of Counsel (provided at the expense of the Certificateholder requesting recordation) to the effect that
such recordation would materially and beneficially affect the interests of the Certificateholders or is required
by law.
Section 9.05. LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS.
(a) The death or incapacity of any Certificateholder shall not terminate this Agreement or the
Trust, nor entitle such Certificateholder's legal representatives or heirs to claim an accounting or to take any
action or proceeding in any court for a partition or winding up of the Trust, nor otherwise affect the rights,
obligations and liabilities of the parties hereto or any of them.
(b) Except as expressly provided in this Agreement, no Certificateholders shall have any right to
vote or in any manner otherwise control the operation and management of the Trust, or the obligations of the
parties hereto, nor shall anything herein set forth, or contained in the terms of the Certificates, be construed
so as to establish the Certificateholders from time to time as partners or members of an association; nor shall
any Certificateholders be under any liability to any third Person by reason of any action taken by the parties to
this Agreement pursuant to any provision hereof.
(c) No Certificateholder shall have any right by virtue of any provision of this Agreement to
institute any suit, action or proceeding in equity or at law upon, under or with respect to this Agreement
against the Depositor or any successor to any such parties unless (i) such Certificateholder previously shall
have given to the Grantor Trustee a written notice of a continuing default, as herein provided, (ii) the Holders
of Certificates evidencing Fractional Undivided Interests aggregating not less than 51% of the Trust Fund shall
have made written request upon the Grantor Trustee to institute such action, suit or proceeding in its own name
as Grantor Trustee hereunder and shall have offered to the Grantor Trustee such reasonable indemnity as it may
require against the costs and expenses and liabilities to be incurred therein or thereby, and (iii) the Grantor
Trustee, for 60 days after its receipt of such notice, request and offer of indemnity, shall have neglected or
refused to institute any such action, suit or proceeding.
(d) No one or more Certificateholders shall have any right by virtue of any provision of this
Agreement to affect the rights of any other Certificateholders or to obtain or seek to obtain priority or
preference over any other such Certificateholder, or to enforce any right under this Agreement, except in the
manner herein provided and for the equal, ratable and common benefit of all Certificateholders. For the
protection and enforcement of the provisions of this Section 9.05, each and every Certificateholder and the
Grantor Trustee shall be entitled to such relief as can be given either at law or in equity.
Section 9.06. ACTS OF CERTIFICATEHOLDERS.
(a) Any request, demand, authorization, direction, notice, consent, waiver or other action provided
by this Agreement to be given or taken by Certificateholders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Certificateholders in person or by an agent duly
appointed in writing. Except as herein otherwise expressly provided, such action shall become effective when
such instrument or instruments are delivered to the Grantor Trustee and/or, where it is expressly required by
this Agreement, to the Depositor and/or the Grantor Trustee. Proof of execution of any such instrument or of a
writing appointing any such agent shall be sufficient for any purpose of this Agreement and conclusive in favor
of the Grantor Trustee and the Depositor if made in the manner provided in this Section 9.06.
(b) The fact and date of the execution by any Person of any such instrument or writing may be
proved by the affidavit of a witness of such execution or by a certificate of a notary public or other officer
authorized by law to take acknowledgments of deeds, certifying that the individual signing such instrument or
writing acknowledged to him the execution thereof. Where such execution is by a signer acting in a capacity
other than his or her individual capacity, such certificate or affidavit shall also constitute sufficient proof
of his or her authority. The fact and date of the execution of any such instrument or writing, or the authority
of the individual executing the same, may also be proved in any other manner which the Grantor Trustee deems
sufficient.
(c) The ownership of Certificates (notwithstanding any notation of ownership or other writing on
such Certificates, except an endorsement in accordance with Section 4.02 made on a Certificate presented in
accordance with Section 4.04) shall be proved by the Certificate Register, and neither the Grantor Trustee, the
Depositor nor any successor to any such parties shall be affected by any notice to the contrary.
(d) Any request, demand, authorization, direction, notice, consent, waiver or other action of the
holder of any Certificate shall bind every future holder of the same Certificate and the holder of every
Certificate issued upon the registration of transfer or exchange thereof, if applicable, or in lieu thereof with
respect to anything done, omitted or suffered to be done by the Grantor Trustee, the Depositor or any successor
to any such party in reliance thereon, whether or not notation of such action is made upon such Certificates.
(e) In determining whether the Holders of the requisite percentage of Certificates evidencing
Fractional Undivided Interests have given any request, demand, authorization, direction, notice, consent or
waiver hereunder, Certificates owned by the Grantor Trustee, the Depositor or any Affiliate thereof shall be
disregarded, except as otherwise provided in Section 9.03(b) and except that, in determining whether the Grantor
Trustee and the Depositor and any Affiliate thereof shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Certificates which such party knows to be so owned
shall be so disregarded. Certificates which have been pledged in good faith to the Grantor Trustee, the Depositor
or any Affiliate thereof may be regarded as outstanding if the pledgor establishes to the satisfaction of the
Grantor Trustee the pledgor's right to act with respect to such Certificates and that the pledgor is not an
Affiliate of the Grantor Trustee or the Depositor, as the case may be.
Section 9.07. GOVERNING LAW. THIS AGREEMENT AND THE CERTIFICATES SHALL BE CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO ITS CONFLICT OF LAWS RULES (OTHER THAN SECTION 5-1401
OF THE NEW YORK GENERAL OBLIGATIONS LAW, WHICH THE PARTIES HERETO EXPRESSLY RELY UPON IN THE CHOICE OF SUCH LAW
AS THE GOVERNING LAW HEREUNDER), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 9.08. NOTICES. All demands and notices hereunder shall be in writing and shall be deemed
given when delivered at (including delivery by facsimile) or mailed by registered mail, return receipt requested,
postage prepaid, or by recognized overnight courier, to (i) in the case of the Depositor, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Vice President-Servicing, telecopier number: (▇▇▇) ▇▇▇-▇▇▇▇, or to such other
address as may hereafter be furnished to the other parties hereto in writing; (ii) in the case of the Grantor
Trustee, at its Corporate Trust Office, or such other address as may hereafter be furnished to the other parties
hereto in writing, (iii) in the case of the Swap Counterparty, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: Head of Interest Rate Derivatives, or (iv) in the case of the Rating Agencies, ▇▇▇▇▇'▇ Investors
Service, Inc., 7 World Trade Center, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, and Standard & Poor's Rating
Services, a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇,
Attention: Residential Mortgage Surveillance. Any notice delivered to the Depositor or the Grantor Trustee under
this Agreement shall be effective only upon receipt. Any notice required or permitted to be mailed to a
Certificateholder, unless otherwise provided herein, shall be given by first-class mail, postage prepaid, at the
address of such Certificateholder as shown in the Certificate Register. Any notice so mailed within the time
prescribed in this Agreement shall be conclusively presumed to have been duly given when mailed, whether or not
the Certificateholder receives such notice.
Section 9.09. SEVERABILITY OF PROVISIONS. If any one or more of the covenants, agreements,
provisions or terms of this Agreement shall be for any reason whatsoever held invalid, then such covenants,
agreements, provisions or terms shall be deemed severed from the remaining covenants, agreements, provisions or
terms of this Agreement and shall in no way affect the validity or enforceability of the other provisions of this
Agreement or of the Certificates or the rights of the holders thereof.
Section 9.10. SUCCESSORS AND ASSIGNS. The provisions of this Agreement shall be binding upon and
inure to the benefit of the respective successors and assigns of the parties hereto.
Section 9.11. ARTICLE AND SECTION HEADINGS. The article and section headings herein are for
convenience of reference only, and shall not limit or otherwise affect the meaning hereof.
Section 9.12. COUNTERPARTS. This Agreement may be executed in two or more counterparts, each of
which when so executed and delivered shall be an original but all of which together shall constitute one and the
same instrument.
Section 9.13. NOTICE TO RATING AGENCIES. The article and section headings herein are for
convenience of reference only, and shall not limited or otherwise affect the meaning hereof. The Grantor Trustee
shall promptly provide notice to each Rating Agency with respect to each of the following of which it has actual
knowledge:
(1) Any material change or amendment to this Agreement;
(2) The resignation or termination of the Grantor Trustee under this Agreement;
(3) The final payment to Certificateholders; and
(4) Any change in the location of the Grantor Trust Distribution Account.
Section 9.14. ENFORCEMENT OF RIGHTS. The Grantor Trustee shall take such action as may be necessary
to enforce the rights of the Trust pursuant to the Swap Agreement and, to the extent the Swap Agreement is
terminated prior to the Termination Date set forth therein, shall enter into a replacement swap agreement as
directed by the Depositor.
SECTION 9.15. BENEFICIARIES. THE SWAP COUNTERPARTY AND ITS SUCCESSORS AND ASSIGNS SHALL BE A THIRD
PARTY BENEFICIARY OF EACH AGREEMENT OR OBLIGATION IN THIS AGREEMENT RELATING TO THE RIGHTS OF THE SWAP
COUNTERPARTY HEREUNDER.
[Signatures Follow]
IN WITNESS WHEREOF, the Depositor and the Grantor Trustee have caused their names to be signed hereto by
their respective officers thereunto duly authorized as of the day and year first above written.
STRUCTURED ASSET MORTGAGE
INVESTMENTS II INC, as Depositor
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Title: Senior Managing Director
▇▇▇▇▇ FARGO BANK, NATIONAL
ASSOCIATION, as Grantor Trustee
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the 31st day of August, 2007, before me, a notary public in and for said State, personally appeared
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇, known to me to be a Senior Managing Director of Structured Asset Mortgage Investments II Inc.,
the corporation that executed the within instrument, and also known to me to be the person who executed it on
behalf of said corporation, and acknowledged to me that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the day and year in this
certificate first above written.
/s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Notary Public
[Notarial Seal]
STATE OF MARYLAND )
) ss.:
COUNTY OF ▇▇▇▇▇▇ )
On the 31st day of August, 2007, before me, a notary public in and for said State, personally appeared
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, known to me to be a Vice President of ▇▇▇▇▇ Fargo Bank, National Association, the corporation
that executed the within instrument, and also known to me to be the person who executed it on behalf of said
corporation, and acknowledged to me that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the day and year in this
certificate first above written.
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Notary Public
[Notarial Seal]
EXHIBIT A
Form of Class A-4B Certificate
THE CURRENT PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE DECREASED BY THE PRINCIPAL PAYMENTS MADE WITH
RESPECT HERETO AND UNDERLYING REALIZED LOSSES ALLOCABLE TO THE UNDERLYING CERTIFICATES. ACCORDINGLY, FOLLOWING
THE INITIAL ISSUANCE OF THE CERTIFICATES, THE CURRENT PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE DIFFERENT FROM
THE DENOMINATION SHOWN BELOW. ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT PRINCIPAL AMOUNT BY
INQUIRY OF THE GRANTOR TRUSTEE NAMED HEREIN.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO
THE GRANTOR TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR INDIRECTLY BY, OR ON BEHALF OF, AN EMPLOYEE BENEFIT
PLAN OR OTHER RETIREMENT ARRANGEMENT WHICH IS SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT
OF 1974, AS AMENDED ("ERISA"), AND/OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED, UNLESS THE
PURCHASE OF THE CLASS A-4B CERTIFICATES ON BEHALF OF SUCH PERSON WILL NOT RESULT IN OR CONSTITUTE A NON-EXEMPT
PROHIBITED TRANSACTION UNDER ERISA OR SECTION 4975 OF THE CODE, IS PERMISSIBLE UNDER APPLICABLE LAW AND WILL NOT
GIVE RISE TO ANY OBLIGATIONS ON THE PART OF THE DEPOSITOR, THE SERVICER, THE UNDERLYING TRUSTEE OR THE GRANTOR
TRUSTEE IN ADDITION TO THOSE OBLIGATIONS SET FORTH IN THE UNDERLYING POOLING AND SERVICING AGREEMENT.
ANY PERSON ACQUIRING AN INTEREST IN A CERTIFICATE, BY ACQUISITION OF SUCH CERTIFICATE, SHALL BE DEEMED
TO HAVE REPRESENTED TO THE GRANTOR TRUSTEE THAT EITHER: (I) IT IS NOT ACQUIRING AN INTEREST IN SUCH CERTIFICATE
DIRECTLY OR INDIRECTLY BY, OR ON BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT WHICH IS
SUBJECT TO TITLE I OF ERISA AND/OR SECTION 4975 OF THE CODE, OR (II) THE TRANSFER AND/OR HOLDING OF AN INTEREST
IN SUCH CERTIFICATE TO THAT PERSON AND THE SUBSEQUENT SERVICING, MANAGEMENT AND/OR OPERATION OF THE TRUST AND ITS
ASSETS: (I) WILL NOT RESULT IN ANY PROHIBITED TRANSACTION WHICH IS NOT COVERED UNDER A STATUTORY OR AN
ADMINISTRATIVE INDIVIDUAL OR CLASS PROHIBITED TRANSACTION EXEMPTION ("PTE"), INCLUDING, BUT NOT LIMITED TO,
SECTION 408(B)(17) OF ERISA, ▇▇▇ ▇▇-▇▇, ▇▇▇ ▇▇-▇, ▇▇▇ ▇▇-▇▇, ▇▇▇ 95-60 OR PTE 96-23 AND (II) WILL NOT SUBJECT THE
DEPOSITOR, THE SERVICER, THE UNDERLYING TRUSTEE OR THE GRANTOR TRUSTEE TO ANY OBLIGATION IN ADDITION TO THOSE
UNDERTAKEN IN THE UNDERLYING POOLING AND SERVICING AGREEMENT. THE GRANTOR TRUSTEE WILL NOT BE REQUIRED TO
MONITOR, DETERMINE OR INQUIRE AS TO COMPLIANCE WITH THE FOREGOING TRANSFER RESTRICTIONS AND NONE OF SUCH PERSONS
SHALL HAVE ANY LIABILITY FOR THE TRANSFER OF ANY BOOK-ENTRY CERTIFICATES MADE IN VIOLATION OF THE TRANSFER
RESTRICTIONS SET FORTH IN THE GRANTOR TRUST AGREEMENT.
Certificate No. [__] Variable Pass-Through Rate
Grantor Trust Class A-4B
Date of Grantor Trust Agreement: Aggregate Initial Current Principal Amount of this
August 31, 2007 Certificate as of the Cut-off Date: $[____________]
Cut-off Date: August 1, 2007
First Distribution Date: Initial Current Principal Amount of this
September 25, 2007 Certificate as of the Cut-off Date: $[____________]
Assumed Final Distribution Date: CUSIP: [____________]
[August] 25, 2037
STRUCTURED ASSET MORTGAGE INVESTMENTS II GRANTOR TRUST
2007-AR4
MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 2007-AR4
evidencing a fractional undivided interest in the distributions allocable to the Grantor Trust Class
A-4B Certificates with respect to a Trust Fund consisting primarily of the Underlying Certificates sold
by STRUCTURED ASSET MORTGAGE INVESTMENTS II INC.
This Certificate is payable solely from the assets of the Trust Fund, and does not represent an
obligation of or interest in Structured Asset Mortgage Investments II Inc. (the "Depositor") or the Grantor
Trustee referred to below or any of their affiliates or any other person. Neither this Certificate nor the
Underlying Certificates are guaranteed or insured by any governmental entity or by the Depositor, the Grantor
Trustee or any of their respective affiliates or any other person. None of the Depositor, the Servicer or the
Grantor Trustee nor any of their respective affiliates will have any obligation with respect to any certificate
or other obligation secured by or payable from payments on the Certificates.
This certifies that Cede & Co. is the registered owner of the Fractional Undivided Interest evidenced
hereby in the beneficial ownership interest of Certificates of the same Class as this Certificate in a trust (the
"Trust Fund") consisting primarily of the Class A-4B Certificates (the "Underlying Certificates") sold by the
Depositor. The Trust Fund was created pursuant to the Grantor Trust Agreement, dated as of August 31, 2007 (the
"Agreement"), among the Depositor, as depositor, ▇▇▇▇▇ Fargo Bank, National Association, as grantor trustee (the
"Grantor Trustee"), a summary of certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, capitalized terms used herein shall have the meaning ascribed to them in the
Agreement. This Certificate is issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of its acceptance hereof assents and by
which such Holder is bound.
Interest on this Certificate will accrue during the period from and including the preceding Distribution
Date (or in the case of the first Distribution Date, from the Closing Date) to and including the day prior to the
current Distribution Date on the Current Principal Amount hereof at a per annum rate equal to the Pass-Through
Rate set forth in the Agreement. The Grantor Trustee will distribute on the 25th day of each month, or, if such
25th day is not a Business Day, the immediately following Business Day (each, a "Distribution Date"), commencing
on the first Distribution Date specified above, to the Person in whose name this Certificate is registered at the
close of business on the Business Day immediately preceding such Distribution Date, an amount equal to the
product of the Fractional Undivided Interest evidenced by this Certificate and the amount (of interest and
principal, if any) required to be distributed to the Holders of Certificates of the same Class as this
Certificate. The Assumed Final Distribution Date is the Distribution Date in the month immediately following the
month of the latest scheduled maturity date of any Mortgage Loan and is not likely to be the date on which the
Current Principal Amount of this Class of Certificates will be reduced to zero.
Distributions on this Certificate will be made by the Grantor Trustee by check mailed to the address of
the Person entitled thereto as such name and address shall appear on the Certificate Register or, if such Person
so requests by notifying the Grantor Trustee in writing, as specified in the Agreement. Notwithstanding the
above, the final distribution on this Certificate will be made after due notice by the Grantor Trustee of the
pendency of such distribution and only upon presentation and surrender of this Certificate at the office or
agency appointed by the Grantor Trustee for that purpose and designated in such notice. The Initial Current
Principal Amount of this Certificate is set forth above. The Current Principal Amount hereof will be reduced to
the extent of distributions allocable to principal hereon and any Underlying Realized Losses on the Mortgage
Loans allocable to the Underlying Certificates (and, correspondingly, to the Certificates). This Certificate is
one of a duly authorized issue of Certificates designated as set forth on the face hereof (the "Certificates"),
issued in one Class. The Certificates, in the aggregate, evidence the entire beneficial ownership interest in
the Trust Fund formed pursuant to the Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees that it will look solely to the
Trust Fund for payment hereunder and that the Grantor Trustee is not liable to the Certificateholders for any
amount payable under this Certificate or the Agreement or, except as expressly provided in the Agreement, subject
to any liability under the Agreement.
This Certificate does not purport to summarize the Agreement and reference is made to the Agreement for
the interests, rights and limitations of rights, benefits, obligations and duties evidenced hereby, and the
rights, duties and immunities of the Grantor Trustee with respect thereto.
The Agreement permits, with certain exceptions therein provided, the amendment thereof and the
modification of the rights and obligations of the Depositor and the rights of the Certificateholders under the
Agreement from time to time by the Depositor and the Grantor Trustee with the consent of the Holders of
Certificates evidencing Fractional Undivided Interests aggregating not less than 51% of the Trust Fund. Any such
consent by the Holder of this Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer hereof or in lieu hereof, whether or
not notation of such consent is made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the Holders of any of the Certificates or the consent of
the Swap Counterparty, or without the consent of the Holders of any of the Certificates but with the consent of
the Swap Counterparty.
As provided in the Agreement and subject to certain limitations therein set forth, the transfer of this
Certificate is registerable with the Grantor Trustee upon surrender of this Certificate for registration of
transfer at the offices or agencies maintained by the Grantor Trustee for such purposes, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to, the Grantor Trustee, duly executed by
the Holder hereof or such Holder's attorney duly authorized in writing, and thereupon one or more new
Certificates in authorized denominations representing a like aggregate Fractional Undivided Interest will be
issued to the designated transferee. The Certificates are issuable only as registered Certificates without
coupons in the Class and denominations specified in the Agreement. As provided in the Agreement and subject to
certain limitations therein set forth, this Certificate is exchangeable for one or more new Certificates
evidencing the same Class and in the same aggregate Fractional Undivided Interest, as requested by the Holder
surrendering the same.
No service charge will be made to the Certificateholders for any such registration of transfer, but the
Grantor Trustee may require payment of a sum sufficient to cover any tax or other governmental charge payable in
connection therewith. The Depositor, the Grantor Trustee and any agent of any of them may treat the Person in
whose name this Certificate is registered as the owner hereof for all purposes, and none of Depositor, the
Grantor Trustee or any such agent shall be affected by notice to the contrary. The obligations created by the
Agreement and the Trust Fund created thereby (other than the obligations to make payments to Certificateholders
with respect to the termination of the Agreement) shall terminate upon the termination of the Underlying Pooling
and Servicing Agreement or upon the making of the final payment or other liquidation with respect to the
Underlying Certificates. In no event, however, will the Trust Fund created by the Agreement continue beyond the
expiration of 21 years after the death of certain persons identified in the Agreement.
Unless this Certificate has been counter-signed by an authorized signatory of the Grantor Trustee by
manual signature, this Certificate shall not be entitled to any benefit under the Agreement, or be valid for any
purpose.
[Signatures Follow]
IN WITNESS WHEREOF, the Grantor Trustee has caused this Certificate to be duly executed.
Dated: August 31, 2007
▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION,
Not in its individual capacity but solely as Grantor Trustee
By: _____________________________________
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-4B Certificates referred to in the within-mentioned Agreement.
▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION,
as Grantor Trustee
By: _____________________________________
Authorized Signatory
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
____________________________________ (Please print or typewrite name and address including postal zip code of
assignee) a Fractional Undivided Interest evidenced by the within Mortgage Pass-Through Certificate and hereby
authorizes the transfer of registration of such interest to assignee on the Certificate Register of the Trust
Fund.
I (We) further direct the Grantor Trustee to issue a new Certificate of a like denomination and Class,
to the above named assignee and deliver such Certificate to the following address:
Dated: _________________________________________
Signature by or on behalf of assignor
_________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately available funds to
__________________________________ for the account of _____________________________ account number __________,
or, if mailed by check, to _________________________________________. Applicable statements should be mailed to
_________________________________________________________. This information is provided by
_______________________________________, the assignee named above, or ____________________________, as its agent.
EXHIBIT B
COPY OF UNDERLYING CLASS A-4B CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR INTEREST" IN A
"REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE").
THE CURRENT PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE DECREASED BY THE PRINCIPAL PAYMENTS
HEREON AND REALIZED LOSSES ALLOCATED HERETO AND INCREASED TO THE EXTENT OF NET DEFERRED INTEREST ALLOCATED HERETO
AS SET FORTH IN THE AGREEMENT. ACCORDINGLY, FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE CURRENT
PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE DIFFERENT FROM THE DENOMINATION SHOWN BELOW. ANYONE ACQUIRING THIS
CERTIFICATE MAY ASCERTAIN ITS CURRENT PRINCIPAL AMOUNT BY INQUIRY OF THE TRUSTEE NAMED HEREIN.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY TO THE TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED
IS REGISTERED IN THE NAME OF ▇▇▇▇▇ FARGO, N.A. AS GRANTOR TRUSTEE OR SUCH OTHER NAME AS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO ▇▇▇▇▇ FARGO, N.A. AS GRANTOR
TRUSTEE, ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE
THE REGISTERED OWNER HEREOF, ▇▇▇▇▇ FARGO, N.A. AS GRANTOR TRUSTEE, HAS AN INTEREST HEREIN.
Certificate No. 1 Variable Pass-Through Rate
Underlying Class A-4B
Super Senior
Aggregate Initial Current Principal Amount of this
Date of Pooling and Servicing Agreement and Cut-off Date: Certificate as of the Cut-off Date:
August 1, 2007 $[_______]
First Distribution Date: Initial Current Principal Amount of this Certificate as
September 25, 2007 of the Cut-off Date: $[_________]
Servicer: CUSIP: [________]
EMC Mortgage Corporation
Assumed Final Distribution Date:
[August] 25, 2037
STRUCTURED ASSET MORTGAGE INVESTMENTS II TRUST 2007-AR4
MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 2007-AR4
evidencing a fractional undivided interest in the distributions allocable to the Underlying
Class A-4B Certificates with respect to a Trust Fund consisting primarily of a pool of
adjustable interest rate mortgage loans secured by first liens on one- to four-family
residential properties (the "Mortgage Loans") and sold by Structured Asset Mortgage Investments
II Inc.
This Certificate is payable solely from the assets of the Trust Fund, and does not represent an
obligation of or an interest in Structured Asset Mortgage Investments II Inc. ("▇▇▇▇ ▇▇"), the Servicer or the
Trustee referred to below or any of their affiliates or any other person. Neither this Certificate nor the
underlying Mortgage Loans are guaranteed or insured by any governmental entity or by ▇▇▇▇ ▇▇, the Servicer or the
Trustee or any of their affiliates or any other person. None of ▇▇▇▇ ▇▇, the Servicer or any of their affiliates
will have any obligation with respect to any certificate or other obligation secured by or payable from payments
on the Certificates.
This certifies that ▇▇▇▇▇ Fargo, N.A. as Grantor Trustee is the registered owner of the
Fractional Undivided Interest evidenced hereby in the beneficial ownership interest of Certificates of the same
Class as this Certificate in a trust (the "Trust Fund") primarily consisting of the Mortgage Loans sold by ▇▇▇▇
▇▇. The Mortgage Loans were sold by EMC Mortgage Corporation ("EMC") to ▇▇▇▇ ▇▇. EMC will act as servicer of the
Mortgage Loans (the "Servicer," which term includes any successors thereto under the Agreement referred to
below). The Trust Fund was created pursuant to the Pooling and Servicing Agreement dated as of the Cut-off Date
specified above (the "Agreement"), among ▇▇▇▇ ▇▇, as depositor (the "Seller"), EMC and ▇▇▇▇▇ Fargo Bank, National
Association, as trustee (the "Trustee"), a summary of certain of the pertinent provisions of which is set forth
hereafter. To the extent not defined herein, capitalized terms used herein shall have the meaning ascribed to
them in the Agreement. This Certificate is issued under and is subject to the terms, provisions and conditions
of the Agreement, to which Agreement the Holder of this Certificate by virtue of its acceptance hereof assents
and by which such Holder is bound.
Interest on this Certificate will accrue during the period from and including the preceding
Distribution Date (as hereinafter defined) (or in the case of the first Distribution Date, from the Closing Date)
to and including the day prior to the current Distribution Date on the Current Principal Amount hereof at a per
annum rate equal to the Pass-Through Rate set forth in the Agreement. The Trustee will distribute on the 25th
day of each month, or, if such 25th day is not a Business Day, the immediately following Business Day (each, a
"Distribution Date"), commencing on the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of the month preceding the month in
which such Distribution Date occurs, an amount equal to the product of the Fractional Undivided Interest
evidenced by this Certificate and the amount (of interest, if any) required to be distributed to the Holders of
Certificates of the same Class as this Certificate. The Assumed Final Distribution Date is the Distribution Date
in the month following the latest scheduled maturity date of any Mortgage Loan and is not likely to be the date
on which the Current Principal Amount of this Class of Certificates will be reduced to zero.
Distributions on this Certificate will be made by the Trustee by check mailed to the address of
the Person entitled thereto as such name and address shall appear on the Certificate Register or, if such Person
so requests by notifying the Trustee in writing as specified in the Agreement, by wire transfer. Notwithstanding
the above, the final distribution on this Certificate will be made after due notice by the Trustee of the
pendency of such distribution and only upon presentation and surrender of this Certificate at the office or
agency appointed by the Trustee for that purpose and designated in such notice. The initial Current Principal
Amount of this Certificate is set forth above. The Current Principal Amount hereof will be reduced to the extent
of distributions allocable to principal hereon and Realized Losses allocated hereto and will be increased to the
extent of Net Deferred Interest allocated thereto, in each case, as set forth in the Agreement.
This Certificate is one of a duly authorized issue of Certificates designated as set forth on
the face hereof (the "Certificates"). The Certificates, in the aggregate, evidence the entire beneficial
ownership interest in the Trust Fund formed pursuant to the Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees that it will look solely
to the Trust Fund for payment hereunder and that the Trustee is not liable to the Certificateholders for any
amount payable under this Certificate or the Agreement or, except as expressly provided in the Agreement, subject
to any liability under the Agreement.
This Certificate does not purport to summarize the Agreement and reference is made to the
Agreement for the interests, rights and limitations of rights, benefits, obligations and duties evidenced hereby,
and the rights, duties and immunities of the Trustee.
The Agreement permits, with certain exceptions therein provided: (i) the amendment thereof and
the modification of the rights and obligations of the Seller, the Servicer and the Trustee and the rights of the
Certificateholders under the Agreement from time to time by the Seller, the Servicer and the Trustee, and (ii)
the amendment thereof by the Servicer and the Trustee with the consent of the Holders of Certificates, evidencing
Fractional Undivided Interests aggregating not less than 51% of the Trust Fund (or in certain cases, Holders of
Certificates of affected Classes evidencing such percentage of the Fractional Undivided Interests thereof). Any
such consent by the Holder of this Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer hereof or in lieu hereof whether or
not notation of such consent is made upon this Certificate. The Agreement also permits the amendment thereof in
certain limited circumstances, without the consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein set forth, the transfer
of this Certificate will be registered with the Trustee upon surrender of this Certificate for registration of
transfer at the offices or agencies maintained by the Trustee for such purposes, duly endorsed by, or accompanied
by a written instrument of transfer in form satisfactory to the Trustee duly executed by the Holder hereof or
such Holder's attorney duly authorized in writing, and thereupon one or more new Certificates in authorized
denominations representing a like aggregate Fractional Undivided Interest will be issued to the designated
transferee.
The Certificates are issuable only as registered Certificates without coupons in the Classes
and denominations specified in the Agreement. As provided in the Agreement and subject to certain limitations
therein set forth, this Certificate is exchangeable for one or more new Certificates evidencing the same Class
and in the same aggregate Fractional Undivided Interest, as requested by the Holder surrendering the same.
No service charge will be made to the Certificateholders for any such registration of transfer,
but the Trustee may require payment of a sum sufficient to cover any tax or other governmental charge payable in
connection therewith. The Seller, the Servicer, the Trustee and any agent of any of them may treat the Person in
whose name this Certificate is registered as the owner hereof for all purposes, and none of the Seller, the
Servicer, the Trustee or any such agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created thereby (other than the
obligations to make payments to Certificateholders with respect to the termination of the Agreement) shall
terminate upon the earlier of (i) the later of (A) the maturity or other liquidation (or Advance with respect
thereto) of the last Mortgage Loan remaining in the Trust Fund and disposition of all property acquired upon
foreclosure or deed in lieu of foreclosure of any Mortgage Loan and (B) the remittance of all funds due under the
Agreement, or (ii) the optional repurchase by the party named in the Agreement of all the Mortgage Loans and
other assets of the Trust Fund in accordance with the terms of the Agreement. Such optional repurchase may be
made only if (i) the Stated Principal Balance of the Mortgage Loans at the time of any such repurchase is less
than 10% of (a) the Cut-off Date Balance of such Mortgage Loans and (b) the Pre-Funded Amount or (ii) the
Depositor, based upon an Opinion of Counsel addressed to the Depositor and the Trustee has determined that the
REMIC status of any REMIC under the Agreement has been lost or that a substantial risk exists that such REMIC
status will be lost for the then-current taxable year. The exercise of such right will effect the early
retirement of the Certificates. In no event, however, will the Trust Fund created by the Agreement continue
beyond the expiration of 21 years after the death of certain persons identified in the Agreement.
Unless this Certificate has been countersigned by an authorized signatory of the Trustee by
manual signature, this Certificate shall not be entitled to any benefit under the Agreement or be valid for any
purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly executed.
Dated: August 31, 2007 ▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION
Not in its individual capacity but solely as Trustee
By:_________________________________________________
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Underlying Class A-4B Certificates referred to in the within-mentioned
Agreement.
▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION
Authorized signatory of ▇▇▇▇▇ Fargo Bank, National
Association, not in its individual capacity but
solely as Trustee
By:__________________________________________________
Authorized Signatory
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
__________________________________ (Please print or typewrite name and address including postal zip code of
assignee) a Fractional Undivided Interest evidenced by the within Mortgage Pass-Through Certificate and hereby
authorizes the transfer of registration of such interest to assignee on the Certificate Register of the Trust
Fund.
I (We) further direct the Certificate Registrar to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such Certificate to the following address:
Dated:
____________________________________________________
Signature by or on behalf of assignor
____________________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately available funds to
_________________________________ for the account of _________________________ account number _____________, or,
if mailed by check, to ______________________________. Applicable statements should be mailed to
_____________________________________________.
This information is provided by __________________, the assignee named above, or
________________________, as its agent.
EXHIBIT C
BEAR ▇▇▇▇▇▇▇ CAPITAL MARKETS INC.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
TEL ▇▇▇-▇▇▇-▇▇▇▇
DATE: August 31, 2007
TO: ▇▇▇▇▇ Fargo Bank, National Association, not individually, but solely
as Grantor Trustee for Structured Asset Mortgage Investments II
Grantor Trust 2007-AR4 (the "Trust")
ATTENTION: Structured Finance Agency & Trust-SAMI 2007-AR4
TELEPHONE: ▇-▇▇▇-▇▇▇-▇▇▇▇
FACSIMILE: ▇-▇▇▇-▇▇▇-▇▇▇▇
FROM: Derivatives Documentation
TELEPHONE: ▇▇▇-▇▇▇-▇▇▇▇
FACSIMILE: ▇▇▇-▇▇▇-▇▇▇▇
SUBJECT: Mortgage Derivatives Confirmation
REFERENCE NUMBER(S): [_________]
The purpose of this letter agreement is to confirm the terms and conditions of the Transaction entered
into on the Trade Date specified below (the "Transaction") between Bear ▇▇▇▇▇▇▇ Capital Markets Inc.
("Bear ▇▇▇▇▇▇▇") and Structured Asset Mortgage Investments II Grantor Trust 2007-AR4 ("Counterparty"). This
letter agreement constitutes the sole and complete "Confirmation," as referred to in the "Master
Agreement" (as defined below), with respect to the Transaction.
1. This Confirmation is subject to and incorporates the 2006 ISDA Definitions (the "Definitions"),
as published by the International Swaps and Derivatives Association, Inc. ("ISDA"). The parties agree to
negotiate, execute and deliver an agreement in the form of the 1992 ISDA Master Agreement
(Multicurrency-Cross Border) (the "Form Master Agreement"), together with the schedule thereto and any
other related documents, each in form and substance as the parties shall in good faith agree
(collectively, the "Executed Master Agreement"). In addition, the parties agree that until execution and
delivery of the Executed Master Agreement, a Form Master Agreement, shall be deemed to have been executed
and delivered by the parties on the Trade Date of the first transaction that by its terms is intended to
be governed by a Master Agreement. All provisions contained in, or incorporated by reference to, the Form
Master Agreement or the Executed Master Agreement (as applicable, the "Master Agreement") shall govern the
Transaction referenced in this Confirmation, except as expressly modified below. This Confirmation,
together with all of the other documents confirming any and all Transactions entered into between us
(regardless of which branch, if any, either of us has acted through) that by their terms are intended to
be governed by a Master Agreement, shall supplement, form a part of and be subject to the Master
Agreement. In the event of any inconsistency between the provisions of this Confirmation and the
Definitions or Master Agreement, this Confirmation shall prevail for the purpose of this Transaction.
Terms capitalized but not defined herein shall have the meaning ascribed to them in the Grantor Trust
Agreement, dated as of August 31, 2007 (the "Grantor Trust Agreement") among Structured Asset Mortgage
Investments II, Inc., as depositor (the "Depositor"), ▇▇▇▇▇ Fargo Bank, National Association, as paying
agent, securities administrator and certificate registrar (the "Paying Agent", "Securities Administrator"
and "Certificate Registrar") and ▇▇▇▇▇ Fargo Bank, National Association, as grantor trustee (the "Grantor
Trustee").
2. The terms of the particular Transaction to which this Confirmation relates are as follows:
Trade Date: August 20, 2007
Effective Date: August 31, 2007
Notional Amount: For any Calculation Period, the Certificate Principal
Balance of the Grantor Trust Certificates as of the close of
business on the 25th day of the month in which such
Calculation Period begins (or, if remittances on such
Grantor Trust Certificates are not made on such day, as of
the close of business on the next day on which such
remittances are made).
Termination Date: The earlier to occur of (a) the Distribution Date (as defined
in the Underlying Pooling and Servicing Agreement) following
the date on which the aggregate outstanding principal balance
of the Underlying Reference Certificates is reduced to zero
and the Deferred Interest Carry-Forward Balance is zero or (b)
August 25, 2037, subject, in each case, to adjustment in
accordance with the Business Day Convention.
Grantor Trust Certificates: The Class [____] Certificates (as defined in the Grantor Trust
Agreement).
Underlying Reference
Certificates: The Class [____] Certificates (as defined in the Underlying
Pooling and Servicing Agreement).
Bear ▇▇▇▇▇▇▇
Payment Amounts:
Bear ▇▇▇▇▇▇▇
Payment Dates: The 25th calendar day of each month during the Term of this
Transaction, commencing September 25, 2007 and ending on the
Termination Date, subject to adjustment in accordance with
the Business Day Convention
Bear ▇▇▇▇▇▇▇
Payment Amounts: On each Bear ▇▇▇▇▇▇▇ Payment Date, Bear ▇▇▇▇▇▇▇ shall pay to
Counterparty an amount equal to any Net Deferred Interest
allocated to the Certificate Principal Balance of the
Underlying Reference Certificates in accordance with the
definition of Net Deferred Interest in the Underlying
Pooling and Servicing Agreement for the Distribution Date
(as defined in the Underlying Pooling and Servicing
Agreement) occurring on such Bear ▇▇▇▇▇▇▇ Payment Date.
Counterparty Payments:
Counterparty
Payment Dates: Each Bear ▇▇▇▇▇▇▇ Payment Date.
Counterparty
Payment Amounts #1: On the initial Counterparty Payment Date, zero and for
each Counterparty Payment Date thereafter, Counterparty
shall pay to Bear ▇▇▇▇▇▇▇ an amount equal to the lesser
of
(a) the Deferred Interest Carry-Forward Balance for
the previous Counterparty Payment Date, and
(b) the amount distributed on the Distribution Date
(as defined in the Underlying Pooling and
Servicing Agreement) occurring on such
Counterparty Payment Date to the Underlying
Reference Certificates in respect of (i)
principal reducing the Certificate Principal
Balance of the Underlying Reference
Certificates and (ii) Unpaid Realized Loss
Amounts.
Deferred Interest
Carry-Forward Balance: For each Counterparty Payment Date, an amount equal to
the sum of:
(a) the Deferred Interest Carry-Forward Balance as of
the preceding Counterparty Payment Date (which for the
initial Counterparty Payment Date shall be deemed to be
zero), plus (b) any Bear ▇▇▇▇▇▇▇ Payment Amounts paid by
Bear ▇▇▇▇▇▇▇ to Counterparty on such Counterparty
Payment Date less (c) any Counterparty Payment Amounts
#1 paid to Bear ▇▇▇▇▇▇▇ by the Counterparty on such
Counterparty Payment Date.
Counterparty
Payment Amounts #2: On each Counterparty Payment Date, Counterparty shall
pay to Bear ▇▇▇▇▇▇▇ an amount equal to interest on the
Deferred Interest Carry-Forward Balance as of the
preceding Counterparty Payment Date accrued from and
including, the preceding Counterparty Payment Date to,
but excluding, such Counterparty Payment Date at a rate
equal to the Pass-Through Rate (as defined in the
Underlying Pooling and Servicing Agreement) for the
Underlying Reference Certificates.
Additional Payment: On August 31, 2007, subject to adjustment in accordance
with the Business Day Convention, Counterparty shall pay
to Bear ▇▇▇▇▇▇▇ the amount of USD 22,000
Business Day Convention: Following
Business Days: Any day other than (i) a Saturday or a Sunday, or (ii) a
day on which (a) the New York Stock Exchange or Federal
Reserve is closed or (b) banking institutions in New
York City or in any of the jurisdictions in which the
Trustee, the Master Servicer, the Servicer or the
Securities Administrator (each as defined in the
Underlying Pooling and Servicing Agreement) is located
are authorized or obligated by law or executive order to
be closed.
Calculation Agent: Bear ▇▇▇▇▇▇▇
3.Additional Provisions: (a) Each party hereto is hereby advised and acknowledges
that the other party has engaged in (or refrained from
engaging in) substantial financial transactions and has
taken (or refrained from taking) other material actions
in reliance upon the entry by the parties into the
Transaction being entered into on the terms and
conditions set forth herein and in the Confirmation
relating to such Transaction, as applicable. This
paragraph shall be deemed repeated on the trade date of
each Transaction.
(b) On the second Business Day prior to each Bear ▇▇▇▇▇▇▇
Payment Date, the Paying Agent shall provide Bear ▇▇▇▇▇▇▇
with the amount and supporting calculations of any Bear
▇▇▇▇▇▇▇ Payment Amounts, Counterparty Payment Amounts
#1, and Counterparty Payment Amounts #2, if any, to be
paid on such Bear ▇▇▇▇▇▇▇ Payment Date or Counterparty
Payment Date, as applicable. For the avoidance of
doubt, Bear ▇▇▇▇▇▇▇ shall not be obligated to make any
payment on a Bear ▇▇▇▇▇▇▇ Payment Date until it has
received from the Paying Agent the information set forth
in the preceding sentence.
(c) Notwithstanding anything in Section 2(c) of the Form
Master Agreement to the contrary, if on any date an
amount would be owed by Bear ▇▇▇▇▇▇▇ to Counterparty
after application of the netting provisions of Section
2(c) of the Form Master Agreement with respect to such
date, subject to Section 3(b) above, Bear ▇▇▇▇▇▇▇ hereby
agrees to remit such payment to Counterparty one
Business Day prior to such date.
4. Provisions Deemed Incorporated in a Schedule to the Form Master Agreement:
1) The parties agree that subparagraph (ii) of Section 2(c) of the Form Master Agreement will apply to
any Transaction.
2) Termination Provisions. For purposes of the Form Master Agreement:
(a) "Specified Entity" is not applicable to Bear ▇▇▇▇▇▇▇ or Counterparty for any purpose.
(b) "Specified Transaction" is not applicable to Bear ▇▇▇▇▇▇▇ or Counterparty for any purpose, and,
accordingly, Section 5(a)(v) will not apply to Bear ▇▇▇▇▇▇▇ and will not apply to Counterparty.
(c) Section 5(a)(i) of the Form Master Agreement is hereby amended by deleting the word "third"
therein and replacing it with the word "second."
(d) "Breach of Agreement" provision of Section 5(a)(ii) will not apply to Bear ▇▇▇▇▇▇▇ and will not
apply to Counterparty.
(e) "Credit Support Default" provisions of Section 5(a)(iii) will apply to Bear ▇▇▇▇▇▇▇ and will not
apply to Counterparty.
(f) "Misrepresentation" provisions of Section 5(a)(iv) will not apply to Bear ▇▇▇▇▇▇▇ and will not
apply to Counterparty.
(g) The "Merger Without Assumption" provision of Section 5(a)(viii) will apply to Bear ▇▇▇▇▇▇▇ and
will not apply to Counterparty.
(h) The "Cross Default" provision of Section 5(a)(vi) will not apply to Bear ▇▇▇▇▇▇▇ and will not apply to
Counterparty.
(i) The "Credit Event Upon Merger" provisions of Section 5(b)(iv) will not apply to Bear ▇▇▇▇▇▇▇ and
will not apply to Counterparty.
(j) The "Bankruptcy" provision of Section 5(a)(vii)(2) will apply to Bear ▇▇▇▇▇▇▇ and will not apply
to Counterparty.
(k) The "Automatic Early Termination" provision of Section 6(a) will not apply to Bear ▇▇▇▇▇▇▇ or to
Counterparty.
(l) Payments on Early Termination. For the purpose of Section 6(e) of the Form Master Agreement:
(i) Market Quotation will apply.
(ii) The Second Method will apply.
(m) "Termination Currency" means United States Dollars.
(n) Additional Termination Events.
(i) The following shall constitute an Additional Termination Event, upon which Counterparty
will have the right to designate an Additional Termination Event, Bear ▇▇▇▇▇▇▇ will be the sole
Affected Party and all Transactions hereunder will be Affected Transactions. For avoidance of
doubt, the above remedy shall be the sole remedy available to Counterparty upon the occurrence of
such Additional Termination Event.
(a) After failing to satisfy the First Trigger Required Ratings, the failure by Bear ▇▇▇▇▇▇▇
to comply with Section 17(a) below; and
(b) After failing to satisfy the Second Trigger Required Ratings, the failure by Bear ▇▇▇▇▇▇▇
to, within 30 days from such failure, at its own expense, (i) transfer its rights and
obligations under the Form Master Agreement to a replacement party that has (or whose
guarantor has) the First Trigger Required Ratings, (ii) obtain a guarantor having the
First Trigger Required Ratings for Bear ▇▇▇▇▇▇▇' obligations under the Form Master
Agreement with a form of guaranty satisfying the Rating Agency Condition; provided that
if such form of guaranty is identical to the Guaranty (other than the name of the
guarantor, the effective date and the date of such guaranty), satisfaction of the Rating
Agency Condition shall not be required and Bear ▇▇▇▇▇▇▇ shall provide a copy of such
guaranty to each Rating Agency then rating the Grantor Trust Certificates or (iii) take
such other steps that satisfies the Rating Agency Condition.
(ii) The failure by Counterparty to comply with Section 16 below shall constitute an
Additional Termination Event hereunder, upon which Counterparty shall be the sole Affected Party
and all Transactions hereunder shall be Affected Transactions.
3) Tax Representations. Bear ▇▇▇▇▇▇▇ represents that it is a corporation duly organized and validly
existing under the laws of the State of Delaware, and Counterparty represents that it is a statutory trust
duly organized and validly existing under the laws of the State of Delaware.
4) [Reserved]
5) Documents to be Delivered. For the purpose of Section 4(a):
(1) Tax forms, documents, or certificates to be delivered are:
Party required to deliver document Form/Document/ Date by which to
Certificate be delivered
Bear ▇▇▇▇▇▇▇ and Any document required or Promptly after the earlier of (i) reasonable
the Counterparty reasonably requested to allow demand by either party or (ii) learning that
the other party to make such form or document is required
payments under the Form Master
Agreement without any deduction
or withholding for or on the
account of any Tax or with such
deduction or withholding at a
reduced rate
(2) Other documents to be delivered are:
Party required to Form/Document/ Date by which to Covered by Section 3(d) Representation
deliver document Certificate be delivered
Bear ▇▇▇▇▇▇▇ and Any documents required by Upon the execution and Yes
the Counterparty the receiving party to delivery of the Form
evidence the authority of Master Agreement and such
the delivering party or its Confirmation
Credit Support Provider, if
any, for it to execute and
deliver the Form Master
Agreement, any Confirmation
, and any Credit Support
Documents to which it is a
party, and to evidence the
authority of the delivering
party or its Credit Support
Provider to perform its
obligations under the Form
Master Agreement, such
Confirmation and/or Credit
Support Document, as the
case may be
Bear ▇▇▇▇▇▇▇ and A certificate of an Upon the execution and Yes
the Counterparty authorized officer of the delivery of the Form
party, as to the incumbency Master Agreement and such
and authority of the Confirmation
respective officers of the
party signing the Form Master
Agreement, any relevant
Credit Support Document, or
any Confirmation, as the
case may be
Bear ▇▇▇▇▇▇▇ An opinion of counsel of such Upon the execution and No
party regarding the delivery of the Form
enforceability of this Master Agreement and such
Confirmation in a form Confirmation
reasonably satisfactory to
the other party
Bear ▇▇▇▇▇▇▇ A copy of its most recent Promptly after the request
audited consolidated of by other Party
financial statements
6) Miscellaneous.
(a) Address for Notices: For the purposes of Section 12(a) of the Form Master Agreement:
Contact details for notices or communications to Bear ▇▇▇▇▇▇▇:
Tel: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Attention: Credit Derivatives Department
(For all purposes)
Contact details for notices or communications to the Counterparty:
▇▇▇▇▇ Fargo Bank, National Association
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Client Manager, SAMI 2007 AR4
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Phone: ▇▇▇-▇▇▇-▇▇▇▇
(For all purposes)
(b) Process Agent. For the purpose of Section 13(c):
Bear ▇▇▇▇▇▇▇ appoints as its
Process Agent: Not Applicable
The Counterparty appoints as its
Process Agent: Not Applicable
(c) Offices. The provisions of Section 10(a) will not apply to the Form Master Agreement; neither
Bear ▇▇▇▇▇▇▇ nor the Counterparty have any Offices other than as set forth in the Notices Section
and Bear ▇▇▇▇▇▇▇ agrees that, for purposes of Section 6(b) of the Form Master Agreement, it shall
not in future have any Office other than one in the United States.
(d) Multibranch Party. For the purpose of Section 10(c) of the Form Master Agreement:
Bear ▇▇▇▇▇▇▇ is not a Multibranch Party.
The Counterparty is not a Multibranch Party.
(e) Calculation Agent. The Calculation Agent is Bear ▇▇▇▇▇▇▇.
(f) Credit Support Document.
Bear ▇▇▇▇▇▇▇: Guaranty (the "Guaranty") of The Bear ▇▇▇▇▇▇▇ Companies Inc.
The Counterparty: Not Applicable
(g) Credit Support Provider.
Bear ▇▇▇▇▇▇▇: The Bear ▇▇▇▇▇▇▇ Companies Inc.
The Counterparty: Not Applicable
(h) Governing Law. The parties to the Form Master Agreement hereby agree that the law of the State
of New York shall govern their rights and duties in whole without regard to conflict of law provisions
thereof other than New York General Obligations Law Sections 5-1401 and 5-1402
(i) Severability. If any term, provision, covenant, or condition of the Form Master Agreement, or
the application thereof to any party or circumstance, shall be held to be invalid or unenforceable (in
whole or in part) for any reason, the remaining terms, provisions, covenants, and conditions hereof shall
continue in full force and effect as if the Form Master Agreement had been executed with the invalid or
unenforceable portion eliminated, so long as the Form Master Agreement as so modified continues to
express, without material change, the original intentions of the parties as to the subject matter of the
Form Master Agreement and the deletion of such portion of the Form Master Agreement will not substantially
impair the respective benefits or expectations of the parties.
The parties shall endeavor to engage in good faith negotiations to replace any invalid or unenforceable
term, provision, covenant or condition with a valid or enforceable term, provision, covenant or condition,
the economic effect of which comes as close as possible to that of the invalid or unenforceable term,
provision, covenant or condition.
(j) Consent to Recording. Each party hereto consents to the monitoring or recording, at any
time and from time to time, by the other party of any and all communications between officers or employees
of the parties, waives any further notice of such monitoring or recording, and agrees to notify its
officers and employees of such monitoring or recording.
(k) Waiver of Jury Trial. Each party waives any right it may have to a trial by jury in respect
of any Proceedings relating to the Form Master Agreement or any Credit Support Document.
7) Affiliate. Notwithstanding the definition of Affiliate in Section 14 of the Form Master
Agreement, for purposes hereof each party will be deemed not to have any Affiliates.
8) Relationship Between Parties. Section 3 of the Form Master Agreement is hereby amended by
adding at the end thereof the following subsection (g):
"(g) Relationship Between Parties.
Each party represents to the other party on each date when it enters
into a Transaction that:
(1) Nonreliance. It is not relying on any statement or representation of the other party
regarding the Transaction (whether written or oral), other than the representations expressly made in the
Form Master Agreement or the Confirmation in respect of that Transaction.
(2) Evaluation and Understanding.
(i) It has the capacity to evaluate (internally or through independent
professional advice) the Transaction and has made its own decision to enter into the Transaction; and
(ii) It understands the terms, conditions and risks of the Transaction and is
willing and able to accept those terms and conditions and to assume those risks, financially and
otherwise.
(3) Purpose. It is entering into the Transaction for the purposes of managing its
borrowings or investments, hedging its underlying assets or liabilities or in connection with a line of
business.
(4) Principal. The other party is not acting as a fiduciary for or an adviser to it in
respect of the Transaction."
9) Proceedings. Bear ▇▇▇▇▇▇▇ shall not institute against or cause any other person to
institute against, or join any other person in instituting against Counterparty any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any federal
or state bankruptcy or similar law for a period of one year and one day (or, if longer, the applicable
preference period) following payment in full of the Grantor Trust Certificates and the Underlying
Reference Certificates.
10) Set-off. Notwithstanding any provision of the Form Master Agreement or any other existing or future
agreement, each party irrevocably waives any and all rights it may have to set off, net, recoup or
otherwise withhold or suspend or condition payment or performance of any obligation between it and the
other party hereunder against any obligation between it and the other party under any other
agreements. The provisions for Set-off set forth in Section 6(e) of the Form Master Agreement shall not
apply for purposes of this Transaction.
11) Transfer, Amendment and Assignment. No transfer, amendment, waiver, supplement, assignment or other
modification of this Transaction shall be permitted by either party unless each Rating Agency has been
provided prior notice of the same and confirms in writing (including by facsimile transmission) that it
will not downgrade, qualify, withdraw or otherwise modify its then-current rating of the Grantor Trust
Certificates as a result of such transfer, amendment, waiver, supplement, assignment or other
modification; provided that upon notice to the Rating Agencies, Bear ▇▇▇▇▇▇▇ may transfer the
Transaction(s) pursuant to the Form Master Agreement and all of its interests in such Transaction(s) and
all of its Obligations in or under the Form Master Agreement to its Credit Support Provider or any
affiliates thereof, and if such transfer is to an entity other than its Credit Support Provider, Bear
▇▇▇▇▇▇▇ will furnish to Counterparty a Guaranty of such Credit Support Provider which guarantees all of
such transferee's Obligations in the form of the Guaranty of the Credit Support Provider of Bear ▇▇▇▇▇▇▇
delivered in connection with the Form Master Agreement (other than the name of the guaranteed party, the
effective date and the date of such guaranty). Upon such transfer, Bear ▇▇▇▇▇▇▇ will be fully released
from any and all Obligations and liabilities related to the interests assigned.
12) Limited Recourse Non-petition. The liability of the Counterparty in relation to the Form Master
Agreement and any Confirmation hereunder is limited in recourse to assets in the Trust Fund (as defined in
the Grantor Trust Agreement) and payments of interest proceeds and principal proceeds thereon applied in
accordance with the terms of the Grantor Trust Agreement. Upon application of all of the assets in the
Trust Fund (and proceeds thereon) in accordance with the Grantor Trust Agreement, Bear ▇▇▇▇▇▇▇ shall not
be entitled to take any further steps against the Counterparty to recover any sums due but still unpaid
hereunder or thereunder, all claims in respect of which shall be extinguished.
13) Non-Reliance. Each party represents to the other party that (a) it has not received and is not relying
upon any legal, tax, regulatory, accounting or other advice (whether written or oral) of the other party
regarding this Transaction, other than representations expressly made by that other party in this
Confirmation and in the Form Master Agreement and (b) in respect of this Transaction, (i) it has the
capacity to evaluate (internally or through independent professional advice) this Transaction and has made
its own decision to enter into this Transaction and (ii) it understands the terms, conditions and risks of
this Transaction and is willing to assume (financially and otherwise) those risks. Counterparty
acknowledges that Bear ▇▇▇▇▇▇▇ has advised Counterparty to consult its own tax, accounting and legal
advisors in connection with this Transaction evidenced by this Confirmation and that the Counterparty has
done so.
14) Eligible Contract Participant. Each party represents that it constitutes an "eligible contract
participant" as such term is defined in Section 1(a)12 of the Commodity Exchange Act, as amended.
15) Limitation of Liability. It is expressly understood and agreed by the parties hereto that (a) this
letter agreement is executed and delivered by the Grantor Trustee, not individually or personally but
solely as the Grantor Trustee for the Trust, in the exercise of the powers and authority conferred and
vested in it, (b) the representation, undertakings and agreements herein made on part of the Trust are
made and intended not as personal representations, undertakings and agreements by the Grantor Trustee but
are made and intended for the purpose of binding only the Trust, (c) nothing herein contained shall be
construed as creating any liability on the Grantor Trustee, individually or personally, to perform any
convenient either expressed or implied contained herein, all such liability, if any, being expressly
waived by the parties who are signatories to this letter agreement and by any person claiming by, through
or under such parties and (d) under no circumstances shall the Grantor Trustee be personally liable for
the payment of any indebtedness or expenses of the Trust or be liable for the breach or failure of any
obligation, representation, warranty or covenant made or undertaken by the Trust under this letter
agreement, other than due to its negligence or willful misconduct in performing the obligations of the
Grantor Trustee under the Grantor Trust Agreement.
16) Amendments to Grantor Trust Agreement and Underlying Pooling and Servicing Agreement. Without the
prior written consent of Bear ▇▇▇▇▇▇▇, Counterparty shall not (i) amend the Grantor Trust Agreement or
enter into any amendment or supplemental agreement to the Grantor Trust Agreement if such amendment or
supplemental agreement could reasonably be expected to have a material adverse effect on the interests of
Bear ▇▇▇▇▇▇▇ hereunder or under the Grantor Trust Agreement or (ii) consent to any amendment or
supplemental agreement to the Underlying Pooling and Servicing Agreement if such amendment or supplemental
agreement could reasonably be expected to have a material adverse effect on the interests of Bear ▇▇▇▇▇▇▇
hereunder or on the interests of a holder of the Underlying Reference Certificates under the Underlying
Pooling and Servicing Agreement. Counterparty will furnish to Bear ▇▇▇▇▇▇▇ a copy of each proposed and
each executed amendment or supplemental agreement and copies of any related Rating Agency confirmation
therewith, if any.
17) (a) If Bear ▇▇▇▇▇▇▇ (or its guarantor) fails to have the First Trigger Required Ratings,
Bear ▇▇▇▇▇▇▇ shall (within 30 days from such failure), at its own expense, (i) transfer its
rights and obligations under the Form Master Agreement to a replacement party that has (or
whose guarantor has) the First Trigger Required Ratings, (ii) post collateral to Counterparty
to secure Bear ▇▇▇▇▇▇▇' obligations under the Form Master Agreement in such amount that the
Rating Agencies confirm in writing will be sufficient to maintain the rating on the Grantor
Trust Certificates, (iii) obtain a guarantor having the First Trigger Required Ratings for Bear
▇▇▇▇▇▇▇' obligations under the Form Master Agreement with a form of guaranty satisfying the
Rating Agency Condition; provided that if such form of guaranty is identical to the Guaranty
(other than the name of the guarantor, the effective date and the date of such guaranty),
satisfaction of the Rating Agency Condition shall not be required and Bear ▇▇▇▇▇▇▇ shall
provide a copy of such guaranty to each Rating Agency then rating the Grantor Trust
Certificates or (iv) take such other steps that satisfies the Rating Agency Condition.
(b) If Bear ▇▇▇▇▇▇▇ (or its guarantor) fails to have the Second Trigger Required Ratings,
Bear ▇▇▇▇▇▇▇ shall, within 10 days from such failure, at its own expense, seek to (i) transfer
its rights and obligations under the Form Master Agreement to a replacement party that has (or
whose guarantor has) the First Trigger Required Ratings, (ii) obtain a guarantor having the
First Trigger Required Ratings for Bear ▇▇▇▇▇▇▇' obligations under the Form Master Agreement
with a form of guaranty satisfying the Rating Agency Condition; provided that if such form of
guaranty is identical to the Guaranty (other than the name of the guarantor, the effective date
and the date of such guaranty), satisfaction of the Rating Agency Condition shall not be
required and Bear ▇▇▇▇▇▇▇ shall provide a copy of such guaranty to each Rating Agency then
rating the Grantor Trust Certificates or (iii) take such other steps that satisfies the Rating
Agency Condition.
As used herein:
"First Trigger Required Ratings" shall mean, with respect to any entity (a) either (i)
the unsecured, short-term debt obligations of such entity (or its Credit Support
Provider) are rated at least 'A-1' by S&P or (ii) if such entity does not have a
short-term rating from S&P, the unsecured, long-term senior debt obligations of such
entity (or its Credit Support Provider) are rated at least 'A+' by S&P, and (b) either
(i) the unsecured, long-term senior debt obligations of such entity (or its Credit
Support Provider) are rated at least 'A1' by Moody's (and if rated 'A1' by Moody's,
such rating is not on watch for possible downgrade) and the unsecured, short-term debt
obligations of such entity (or its Credit Support Provider) are rated at least 'P-1'
by Moody's (and if rated 'P-1' by Moody's, such rating is not on watch for possible
downgrade and remaining on watch for possible downgrade), or (ii) if such entity (or
its Credit Support Provider) does not have a short-term debt rating from Moody's, the
unsecured, long-term senior debt obligations of such entity (or its Credit Support
Provider) are rated at least 'Aa3' by Moody's (and if rated 'Aa3' by Moody's, such
rating is not on watch for possible downgrade).
"Second Trigger Required Ratings" shall mean, with respect to any entity (a) the
unsecured, long-term senior debt obligations of such entity (or its Credit Support
Provider) are rated at least 'BBB-' by S&P, and (b) either (i) the unsecured,
long-term senior debt obligations of such entity (or its Credit Support Provider) are
rated at least 'A3' by Moody's (and such rating is not on watch for possible
downgrade) and the unsecured, short-term debt obligations of such entity (or its
Credit Support Provider) are rated at least 'P-2' by Moody's (and such rating is not
on watch for possible downgrade) or (ii) if such entity (or its Credit Support
Provider) does not have a short-term rating from Moody's, the unsecured, long-term
senior debt obligations of such entity (or its Credit Support Provider) are rated at
least 'A2' by ▇▇▇▇▇'▇.
"Rating Agency Condition" means, with respect to any particular proposed act or
omission to act hereunder that the party acting or failing to act must consult with
any of Rating Agency then providing a rating of the Grantor Trust Certificates and
receive from each Rating Agency a prior written confirmation that the proposed action
or inaction would not cause a downgrade or withdrawal of the then-current rating of
the Grantor Trust Certificates.
5. Account Details and
Settlement information: Payments to Bear ▇▇▇▇▇▇▇:
Citibank, N.A., New York
ABA Number: ▇▇▇-▇▇▇▇-▇▇, for the account of
Bear, ▇▇▇▇▇▇▇ Securities Corp.
Account Number: 0925-3186, for further credit to
Bear ▇▇▇▇▇▇▇ Capital Markets
Sub-account Number: ▇▇▇-▇▇▇▇▇-▇▇
Attention: Derivatives Operations
Payments to Counterparty:
▇▇▇▇▇ Fargo Bank, National Association
San Francisco, CA
ABA: ▇▇▇-▇▇▇-▇▇▇
A/C:▇▇▇▇▇▇▇▇▇▇
Account Name: SAS Clearing
For Further Credit to: 53176102, SAMI 07-AR4 Swap Account
This Confirmation may be executed in several counterparts, each of which shall be deemed an original but
all of which together shall constitute one and the same instrument.
Counterparty hereby agrees to check this Confirmation and to confirm that the foregoing correctly sets
forth the terms of the Transaction by signing in the space provided below and returning to Bear ▇▇▇▇▇▇▇ a
facsimile of the fully-executed Confirmation to ▇▇▇-▇▇▇-▇▇▇▇. For inquiries please contact
▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇.▇▇▇. To discuss an inquiry regarding U.S. Transactions, please contact
▇▇▇▇ ▇▇▇▇▇▇▇ by telephone at ▇▇▇-▇▇▇-▇▇▇▇. For all other inquiries please contact Derivatives
Documentation by telephone at ▇▇▇-▇-▇▇▇-▇▇▇▇. Originals will be provided for your execution upon your
request.
We are very pleased to have executed this Transaction with you and we look forward to completing other
transactions with you in the near future.
Very truly yours,
BEAR ▇▇▇▇▇▇▇ CAPITAL MARKETS INC.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Authorized Signatory
Counterparty, acting through its duly authorized signatory, hereby agrees to, accepts and confirms the
terms of the foregoing as of the Trade Date.
▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION NOT INDIVIDUALLY, BUT SOLELY AS GRANTOR TRUSTEE
FOR STRUCTURED ASSET MORTGAGE INVESTMENTS II GRANTOR TRUST 2007-AR4
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
With respect to Section 3(b) herein:
▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION, as Paying Agent
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
EXHIBIT D
Underlying Pooling and Servicing Agreement
[Provided Upon Request]