SFG Transaction 

EXECUTION COPY 

SERVICING AGREEMENT 


by and between 


SQUARE MILE LODGING RECOVERY LLC 


and 


MIDLAND LOAN SERVICES, INC. 


Dated as ofMay 18,2010 

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TABLE OF CONTENTS 


Article I DEFINITIONS AND CONSTRUCTION ......................................................... 1 


Section 1.1 Definitions ................................................................................................... 1 


Section 1.2 Construction............................................................................................... 15 


Article II SERVICING OBLIGATIONS OF THE SERVICER ..................................... 16 


Section 2.1 Appointment and Acceptance as Servicer ................................................. 16 


Section 2.2 Limited Power of Attorney ........................................................................ 16 


Section 2.3 Servicing Fee ............................................................................................. 16 


Section 2.4 Servicing Standard ..................................................................................... 16 


Section 2.5 Collection Account. ................................................................................... 17 


Section 2.6 Retained Obligations ................................................................................. 18 


Section 2.7 Escrow Accounts .......................................................-................................ 18 


Section 2.8 Other Accounts .......................................................................................... 18 


Section 2.9 Maintenance of Insurance Policies; Errors and Omissions and 


Fidelity Coverage ...................................................................................... 18 


Section 2.10 Funding of Working Capital Expenses and Funding Draws ..................... 20 


Section 2.11 Expenses .................................................................................................... 20 


Section 2.12 Insured or Guaranteed Loans ..................................................................... 21 


Section 2.13 Registration with MERS ............................................................................ 21 


Article III LOAN DEFAULTS; ACQUISITION OF COLLATERAL ........................... 21 


Section 3 .1 Delinquency Control.. ................................................................................ 21 


Section 3.2 Discretion of the Servicer in Responding to Defaults of Borrower .......... 21 


Section 3.3 Acquisition of Acquired Property .............................................................. 22 


Section 3.4 Administration of REO Properties ............................................................ 23 


Article IV SUBSERVICING ............................................................................................ 24 


Section 4.1 Retention of Subservicer ........................................................................... 24 


Section 4.2 Subservicing Agreement Requirements .................................................... 24 


Section 4.3 Servicer Liable for Subservicers ................................................................ 27 


Section 4.4 Manager Approval Required ..................: .................................................. 27 


Section 4.5 Regulation AB Requirements .................................................................... 27 


Article V REPRESENTATIONS, WARRANTIES AND COVENANTS OF 


THE SERVICER ............................................................................................. 28 


Section 5.1 Representations and Warranties ................................................................ 28 


Section 5.2 Reporting, Books and Records and Compliance Covenants ..................... 29 


Section 5.3 Audits......................................................................................................... 32 


Section 5.4 No Liens .................................................................................................... 32 


Section 5.5 Servicer's Duty to Advise; Delivery of Certain Notices ........................... 33 


Section 5.6 Notice of Breach or Change ofControl.. ................................................... 34 


Section 5.7 Copies ofDocuments................................................................................. 34 


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Section 5.8 Financial Information ................................................................................ 34 


Article VI MANAGER CONSENT .................................................................................. 34 


Section 6.1 Actions Requiring Manager Consent ........................................................ 34 


Section 6.2 Amendments, Modification and Waivers .................................................. 36 


Article VII DEFAULTS; TERMINATION; TERMINATION WITHOUT CAUSE ....... 36 


Section 7.1 Defaults...................................................................................................... 36 


Section 7.2 Termination with Cause ............................................................................. 38 


Section 7.3 Termination without Cause ....................................................................... 39 


Section 7.4 Effective Termination Date ....................................................................... 39 


Section 7.5 Accounting.................................................................................................40 


Article VIII INDEPENDENCE OF PARTIES; INDEMNIFICATION ............................ .40 · 


Section 8.1 Independence ofParties............................................................................. 40 


Section 8.2 Indemnification.......................................................................................... 40 


Section 8.3 Procedure for Indemnification ................................................................... 41 


Section 8.4 Pre-Effective Date Liabilities .................................................................... 41 


Article IX NOTICES ........................................................................................................ 41 


Article X GOVERNING LAW; JURISDICTION ......................................................... .43 


Section 10.1 Governing Law .......................................................................................... 43 


Section 10.2 Jurisdiction; Venue and Service ............................................................... .43 


Section 10.3 Waiver of Jury Trial ................................................................................. .45 


Article XI MISCELLANEOUS ........................................................................................ 46 


Section 11.1 No Assignment by Servicer; No Transfer of Ownership Interests in 


Servicing Rights ........................................................................................ 46 


Section 11.2 Legal Fees .................................................................................................. 46 


Section 11.3 Entire Agreement. ...................................................................................... 46 


Section 11.4 Counterparts; Facsimile Signatures .......................................................... .46 


Section 11.5 Headings .................................................................................................... 47 


Section 11.6 Compliance with Law ................................................................................47 


Section 11.7 Severability................................................................................................ 4 7 


Section 11.8 Third Party Beneficiaries .......................·'· ..................................................47 


Section 11.9 Protection of Confidential Information .................................................... .48 


Section 11.10 Time of Essence......................................................................................... 48 


Section 11.11 No Presumption ......................................................................................... 48 


Section 11.12 No Right ofSetoff. ................................................................................... .49 


Section 11.13 Release oflnitial Member and Others ...................................................... .49 


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SCHEDULES AND EXHIBIT 


Exhibit 

Exhibit A 

Schedules 

Schedule 1 

Schedule 2 

Schedule 3 

Schedule 4 

Schedule 5 

Schedule 6 

Loan Schedule 

Fee Schedule 

Servicing Obligations 

Reimbursement of Servicer Advances 

Form ofElectronic Report on the Loans and Underlying Collateral 

Termination Without Cause 

Business Plans and Consolidated Business Plans 

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iii 
SERVICING AGREEMENT 


THIS SERVICING AGREEMENT (as the same shall be amended or supplemented, this 

"Agreement") is made and entered into as ofthe 18th day ofMay, 2010 (the "Effective Date"), 

by and between Square Mile Lodging Recovery LLC, a Delaware limited liability company 

(including its successors and assigns, the "Manager"), and Midland Loan Services, Inc., a 

Delaware corporation (including those of its successors and assigns as are expressly permitted 

pursuant to this Agreement, the "Servicer"). 

RECITALS 

WHEREAS, 2010-1 SFG Venture LLC (the "Company") owns the Loans (as defined 

below) described on the Loan Schedule attached hereto as Exhibit A (the "Loan Schedule"); 

WHEREAS, the Manager is the "Manager" ofthe Company with the authority and 

responsibility to service and manage the Loans and related Underlying Collateral (as defined 

below) pursuant to that certain Amended and Restated Limited Liability Company Operating 

Agreement dated as ofthe Closing Date defined below (the "LLC Operating Agreement"), by 

and between the Company, the Manager, including in its separate capacity as a member ofthe 

Company (in such capacity as a member, together with its permitted successors and assigns, the 

"Private Owner"), and the Federal Deposit Insurance Corporation (in any capacity, the 

"FDIC"), as receiver for the Failed Bank defined below (the FDIC, in such capacity, the 

"Receiver", and the Receiver as the "Initial Member" under the LLC Operating Agreement, 

including its successors and assigns, the "Initial Member"); and 

WHEREAS, the Manager and the Servicer desire that the Servicer service and administer 

the Loans and the Underlying Collateral on behalf ofthe Company and the Manager in a manner 

that is, at all times, consistent with the requirements ofthis Agreement. 

NOW, THEREFORE, in consideration ofthe foregoing and the mutual promises and 

agreements contained herein, and for other good and valuable consideration the receipt and 

sufficiency of which are hereby acknowledged, the Manager and the Servicer hereby agree as 

follows: 

ARTICLE I 

DEFINITIONS AND CONSTRUCTION 

Section 1.1 Definitions. For purposes ofthis Agreement, the following terms shall 

have the meanings and definitions hereinafter respectively set forth. 

"Acceptable Rating" shall mean (i) a rating of "Average (Select Servicer List)" for 

construction loan servicers by Standard and Poor's Ratings Service, a division ofThe McGrawHill Companies, Inc., (ii) a rating of"Acceptable" for construction loan servicers by Fitch, Inc., 

(iii) a rating of"Approved" for construction loan servicers by Moody's Investors Service, or (iv) 

a "Qualified Servicer". 

"Acquired Property" shall mean (i) any Underlying Collateral to which title is acquired 

by or on behalf ofthe Company or any Ownership Entity, the Failed Bank or the Receiver by 

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foreclosure, by deed in lieu offoreclosure, by power ofsale or by sale pursuant to the Uniform 

Commercial Code, (ii) the equity interests in the Ownership Entities, and (iii) the assets held 

directly or indirectly by the Ownership Entities. 

"Advance Loan" shall have the meaning given in the Revolver. 

"Affiliate" shall mean, with respect to any specified Person, (i) any other Person directly 

or indirectly Controlling or Controlled by or under common Control with such specified Person, 

(ii) any Person owning or Controlling ten percent (10%) or more ofthe outstanding voting 

securities, voting equity interests, or beneficial interests ofthe Person specified, (iii) any officer, 

director, general partner, managing member, trustee, employee or promoter ofthe Person 

specified or any Immediate Family Member of such officer, director, general partner, managing 

member, trustee, employee or promoter, (iv) any corporation, partnership, limited liability 

company or trust for which any Person referred to in clause (ii) or (iii) acts in that capacity, or 

(v) any Person who is an officer, director, general partner, managing member, trustee or holder 

often percent (10%) or more ofthe outstanding voting securities, voting equity interests or 

beneficial interests of any Person described in clauses (i) through (iv); provided, however, that 

none ofthe Initial Member, the Purchase Money Notes Guarantor, the Collateral Agent or any 

Affiliate (for this purpose determined disregarding clauses (ii), (iii) and (iv) ofthis definition 

(including in the context of clause (v) ofthis definition) and disregarding the Company and any 

Person Controlled by the Company) of any ofthe foregoing shall be deemed to be an "Affiliate" 

ofthe Company or of any Person Controlled by the Company. 

"Agreement" shall have the meaning given in the preamble ofthis Agreement. 

"Ancillary Documents" shall mean the LLC Operating Agreement and each "Ancillary 

Document" defined therein (excluding this Agreement). 

"Approved Business Plan" shall have the meaning given in the Revolver. 

"Borrower" shall mean any borrower with respect to any Loan. 

"Bulk Sale" shall have the meaning given in the LLC Operating Agreement. 

"Business Day" shall mean any day except a Saturday, Sunday or other day on which 

commercial banks in Washington DC or United States federal government offices are required or 

authorized by Law to close. 

"Business Plan" shall have the meaning given in the LLC Operating Agreement. 

"Change of Control" with respect to the Servicer shall mean, (i) the Servicer's Specified 

Parent for any reason (x) failing or ceasing to Control the Servicer or (y) failing or ceasing to 

own, beneficially and ofrecord, and directly or indirectly (including through one or more 

subsidiaries), at least fifty and one~tenth percent (50.1 %) in value of all ofthe equity interests in 

the Servicer, or (ii) without limitation of clause (i), in the event the Servicer is (or at the time it 

became the Servicer, was) an Affiliate ofthe Private Owner, any Change of Control ofthe 

Private Owner. 

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"Closing Date" shall mean May 18,2010. 

"Collateral Agent" shall mean the FDIC, in its capacity as the Collateral Agent under 

(and as defined in) the Reimbursement, Security and Guaranty Agreement, and any successor 

Collateral Agent thereunder. 

"Collection Account" shall mean the Collection Account established by the Company 

pursuant to (and as defined in) the Custodial and Paying Agency Agreement. 

"Company" shall have the meaning given in the recitals ofthis Agreement. 

"Consolidated Business Plan" shall have the meaning given in the LLC Operating 

Agreement. 

"Construction Loan" shall have the meaning given in the Revolver. 

"Contract for Deed" shall mean an executory contract with a third party to convey real 

property to such third party upon payment ofthe amounts set forth therein.and/or the 

performance of any other obligations described therein, including any installment land contract. 

"Contribution Agreement" shall mean the Loan Contribution and Sale Agreement dated 

as ofthe Closing Date between the Initial Member and the Company. 

"Control" (including the phrases "Controlled by" and "under common Control with") 

when used with respect to any specified Person shall mean the possession, direct or indirect, of 

the power to direct or cause the direction ofthe management and policies ofsuch Person, 

whether through the ownership of voting securities or interests, by contract or otherwise. 

"Controlled Affiliate" with respect to the Servicer or any Subservicer, shall mean any 

Affiliate thereof that is Controlled by the Servicer or such Subservicer, as applicable, or by its 

Specified Parent (in the case ofthe Servicer). 

"Custodial and Paying Agency Agreement" shall mean, initially, the Custodial and 

Paying Agency Agreement dated as ofMay 18,2010, by and between the Company, the 

Purchase Money Notes Guarantor and the initial Custodian and Paying Agent, and thereafter any 

replacement Custodial and Paying Agency Agreement entered into from time to time pursuant to 

the LLC Operating Agreement. ' 

"Custodian" shall mean Wells Fargo Bank, N.A., or any successor thereto as the 

"Custodian" under the Custodian and Paying Agency Agreement. 

"Default" shall have the meaning given in Section 7 .1. 

"Discretionary Funding Advance" shall mean an advance by the Manager to the 

Company designated as a "Discretionary Funding Advance" pursuant to the LLC Operating 

Agreement for the making of applicable Funding Draws with respect to specific Loans or related 

Acquired Property. 

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"Effective Date" shall have the meaning given in the preamble ofthis Agreement. 

"Eligible Account" shall mean one (1) or more segregated trust or custodial account or 

accounts established and maintained with an Eligible Institution, each of which shall be for the 

benefit ofthe Company and the Collateral Agent as required by Article II. 

"Eligible Institution" shall mean a Person that is not an Affiliate ofthe Private Owner 

(or the Manager) and that is a federally insured depository institution that is well capitalized; 

provided that an Affiliate ofthe Private Owner (or the Manager) may be deemed to be an 

Eligible Institution if the Purchase Money Notes Guarantor, the Initial Member and the Revolver 

Lender provide a written consent (which may be withheld, conditioned or delayed in each such 

Person's sole and absolute discretion), which consent may be withdrawn upon written 

notification to the Manager, in which case such Affiliate ofthe Private Owner (or ofthe 

Manager) shall no longer constitute an Eligible Institution as ofthe receipt of such notice and 

any accounts maintained pursuant to this Agreement at such institution shall be moved to an 

Eligible Institution within three (3) Business Days after the receipt of such notice. 

"Electronic Report" shall have the meaning given in Section 5.2(e). 

"Environmental Hazard" shall have the meaning given in the LLC Operating 

Agreement. 

"Escrow Account" shall have the meaning given in Section 2.7. 

"Escrow Advance" shall mean any advance made to pay taxes or insurance premiums or 

any other cost or expense that, but for a shortfall in the Borrower's Escrow Account, is payable 

using funds in the Borrower's Escrow Account. 

"Excess Working Capital Advance" shall mean an advance by the Manager to the 

Company designated as an "Excess Working Capital Advance" pursuant to the LLC Operating 

Agreement. 

"Excluded Expenses" shall mean fees, costs, expenses or indemnified amounts that: 

(a) are in excess ofthe relevant amounts provided for in an Approved 

Business Plan (assuming the applicable category offees, costs or expenses are included in the 

applicable Approved Business Plan) or that are not otherwise permitted to be incurred by the 

Company or the Manager under the Revolver; 

(b) are not incurred in accordance with the Servicing Standard; 

(c) constitute or are incurred to pay any expenses or costs of any Affiliate of 

the Manager or the Company, or any Affiliate ofthe Servicer or any Subservicer; provided, that 

Excluded Expenses under this clause (c) do not include costs or expenses expressly payable to 

the Servicer pursuant to this Agreement or to any Subservicer pursuant to any Subservicing 

Agreement that would be deemed Excluded Expenses under this clause (c) solely as a result of 

the Servicer or such Subservicer being an Affiliate ofthe Manager or the Company, so long as 

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such amounts would otherwise constitute Servicing Expenses but for application ofthis clause 

ill; 

(d) are incurred to pay fees or other compensation to or expenses offinancial 

advisers, except to the extent the same are incurred as brokerage fees or sales commissions 

incurred (x) to market or sell the Loans or any Acquired Property in a Bulk Sale, the terms of 

which Bulk Sale (including the financial adviser's or broker's fees or sales comrr!issions) are 

approved in advance by the Initial Member, the Revolver Lender and the Purchase Money Notes 

Guarantor, or (y) in connection with the marketing or sale of any Acquired Property (including 

any REO Property) or any portion thereof on an individual basis; 

(e) are incurred to pay any fine, tax or other penalty, late fee, service charge, 

interest or similar charge, costs to release Liens or any other costs or expenses (including legal 

fees and expenses) incurred by or on behalf ofthe Servicer or any Subservicer as a result of the 

Servicer's or any Subservicer's failure to service any Loan or Underlying Collateral properly in 

accordance with the applicable Loan Documents, this Agreement, any Subservicing Agreement 

or otherwise, or failure to make a payment in a timely manner, or failure otherwise to act in a 

timely manner; 

(f) are incurred to pay any interest on any amounts paid by any Person with 

respect to any Servicing Expenses or Pre-Approved Charges (as such term is defined in the 

Contribution Agreement); 

(g) constitute or are incurred to pay any overhead or administrative costs 

(whether or not attributable to the servicing or management of any Loan) incurred by the 

Servicer, any Subservicer or any other Person (including any travel expenses and any expenses 

incurred to comply with Section 5.2), in each case other than Reimbursable Company 

Administrative Expenses; 

(h) are incurred to pay any servicing, management or similar fees paid to any 

Subservicer or any other Person (other than property management fees approved in writing by 

the Initial Member); 

(i) are incurred (other than Reimbursable Company Administrative Expenses 

with respect to the Company or the Ownership Entities) by the Servicer or any other Person to 

become a MERS member or to maintain the Servicer or such Person as a MERS member in good 

standing; or 

G) constitute or are incurred to pay amounts subject to the indemnity 

obligations ofthe Private Owner under Section 4.6 ofthe LLC Operating Agreement or ofthe 

Servicer under Section 8.2 ofthis Agreement. 

"Failed Bank" shall mean Silverton Bank, N.A. 

"Fee Schedule" shall mean Schedule 1 attached hereto, as the same may be amended 

from time to time by the Manager and the Servicer without the consent ofthe Purchase Money 

Notes Guarantor, the Revolver Lender or the Initial Member. 

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"FDIC" shall have the meaning given in the recitals ofthis Agreement. 

"Funding Draw" shall mean: (i) any principal advance with respect to a Loan pursuant 

to the funding provisions ofthe applicable Loan Documents and in accordance with the 

Servicing Standard, in each case so long as (a) if required by Law or if otherwise deemed 

necessary by the Manager or required hereunder, an endorsement to each applicable title policy 

insuring the Loan, which endorsement shall be in form and content acceptable to the Manager, is 

obtained that (1) brings down the effective date of the title policy to the date on which the 

applicable Funding Draw it covers is made, (2) increases the liability limit ofthe title policy by 

an amount equal to the principal amount of such Funding Draw, and (3) contains no new 

exceptions to title, (b) notwithstanding anything to the contrary contained in this Agreement, if 

the then outstanding Unpaid Principal Balance ofthe Loan exceeds (or would, after taking into 

account the applicable Funding Draw, so exceed) the value ofthe Underlying Collateral, the 

Servicer shall make or permit any such Funding Draw only ifthe Servicer determines, in its 

reasonable judgment and subject to any applicable Servicing Obligations, that the Borrower is 

reasonably likely to be able to repay the Loan, or that the making ofthe Funding Draw is in the 

best interests (in terms of maximizing the value of the Loan) ofthe Company and the Initial 

Member, or that the Company is otherwise legally obligated to make such Funding Draw under 

the applicable Loan Documents, and (c) such advance is made in accordance with the terms of 

the Loan and the Loan Documents, provided, however, that if such advance would result in the 

principal amount of such Loan being in excess of the related unfunded commitment with respect 

thereto (as set forth under the Loan Documents) or if any term with respect to the Loan or the 

Loan Documents precludes such advance in the event of a Borrower default, the applicable 

unfunded commitment may be increased (and such advance may be made) and/or such term may 

be waived, in each case only ifthe Servicer determines, in its reasonable judgment and in 

accordance with the Servicing Standard and subject to any applicable Servicing Obligations, that 

such increase to the unfunded commitment (and related advance) or waiver is in the best interests 

of the Company and the Initial Member in terms of maximizing the value of the Loan and, in the 

case of any such increase to the unfunded commitment (or other advance not contemplated in the 

existing Loan Documents), (x) such increased commitment and the related advance are 

evidenced by an applicable Note (or Notes) and amendments to the Loan Documents (including 

Underlying Collateral Documents) pursuant to which such increased commitment and advance 

shall be secured by all of the Underlying Collateral for such Loan on terms and conditions 

consistent with the Loan Documents as in effect prior to such amendment (without otherwise 

amending the terms and conditions in any such Loan Documen~ except as reasonably required to 

permit such advance to be made in accordance herewith and with the Servicing Standard), and 

(y) the Servicer complies with the requirements in item (i)(a) above; and (ii) payments of costs 

and expenses associated with the continued construction of REO Property (including the 

payment of so-called "soft costs" payable during construction (such as real estate taxes, ground 

rents and insurance premiums)) as would typically have been paid out of funding ofthe 

applicable Loan relating to such REO Property (as reasonably determined by the Manager), in 

each case (x) only to the extent the Servicer determines, in its reasonable judgment and subject to 

any applicable Servicing Obligations, that the payment of such costs and expenses is in the best 

interests (in terms of maximizing the value of the Loan and such REO Property) ofthe Company 

and the Initial Member, and (y) in accordance with the Servicing Standard and the Loan 

Documents that were applicable to the REO Property before it became an REO Property (not 

including payment of debt service under the applicable Loan Documents, and without limiting 

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the amounts to be funded to the applicable unfunded commitment, if any, existing under the 

Loan Documents); provided, that, in no event shall any such costs and expenses payable pursuant 

to any such Funding Draw include any Excluded Expenses; and provided, further, that the 

making of Funding Draws by the Servicer shall be subject to such additional requirements or 

consents as may be set forth in the Servicing Obligations. 

"GAAP" shall mean United States generally accepted accounting principles as in effect 

from time to time. 

"Governmental Authority" shall mean (i) any United States or non-United States 

national, federal, state, local, municipal, provincial or international government or any political 

subdivision of any thereof, or (ii) any governmental, regulatory or administrative authority, 

agency or commission, or judicial or arbitral body, of any ofthe foregoing described in clause 

ffi. 

"ground lease" shall have the meaning given in Section 5.2(e). 

"Group of Loans" shall have the meaning given in the Contribution Agreement. 

"Immediate Family Member" shall mean, with respect to any individual, his or her 

spouse, parent, parent-in-law, grandparent, descendant, nephew, niece, brother, sister, brother-inlaw, sister-in-law, child (whether natural or adopted), child-in-law, stepchild, grandchild and 

grandchild-in-law. 

"Indemnified Parties" shall have the meaning given in Section 8.2. 

"Initial Member" shall have the meaning given in the recitals ofthis Agreement. 

"Insolvency Event" shall mean, with respect to any specified Person, the occurrence of 

any ofthe following events: 

(i) the specified Person makes an assignment for the benefit of creditors; 

Proceeding; 

(ii) the specified Person files a voluntary petition for relief in any Insolvency 

(iii) the specified Person is adjudged bankrupt or insolvent or there is entered 

against the specified Person an order for relief in any Insolvency Proceeding; 

(iv) the specified Person files a petition or answer seeking for the specified 

Person any reorganization, arrangement, composition, readjustment, liquidation, dissolution, or 

similar relief under any Law; 

(v) the specified Person seeks, consents to, or acquiesces in the appointment 

of a trustee, receiver or liquidator ofthe specified Person or of all or any substantial part ofthe 

specified Person's properties; 

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(vi) the specified Person files an answer or other pleading admitting or failing 

to contest the material allegations of a petition filed against the specified Person in any 

proceeding described in clauses (i) through {yl; 

(vii) the specified Person becomes unable to pay its obligations as they become 

due, or the sum of such specified Person's debts is greater than all of such Person's property, at a 

fair valuation; or 

(viii) (i) at least sixty (60) days have passed following the commencement of 

any proceeding against the specified Person seeking reorganization, arrangement, composition, 

readjustment, liquidation, dissolution or similar relief under any Law and such proceeding has 

not been dismissed, or (ii) (x) at least sixty (60) days have passed following the appointment of a 

trustee, receiver or liquidator for the specified Person or all or any substantial part ofthe 

specified Person's properties without the specified Person's agreement or acquiescence, and such 

appointment is not vacated or stayed, or (y) if such appointment is stayed, at least sixty (60) 

days have passed following the expiration ofthe stay and such appointment has not been 

vacated. 

"Insolvency Proceeding" shall mean any proceeding under Title II ofthe United States 

Code (II U.S.C. §§IOI, et seq.) or any proceeding under any other Debtor Relief Law. 

"LLC Operating Agreement" shall have the meaning given in the recitals ofthis 

Agreement. 

"Law" shall mean any applicable statute, law, ordinance, regulation, rule, code, 

injunction, judgment, decree or order (including any executive order) of any Governmental 

Authority. 

"Lien" shall mean any mortgage, deed oftrust, pledge, deed to secure debt, trust deed, 

security interest, charge, restriction on or condition to transfer, voting or exercise or enjoyment 

of any right or beneficial interest, option, right offirst refusal, easement, covenant, restriction 

and any other lien, claim or encumbrance of any nature whatsoever. 

"Loan" shall mean any loan, Loan Participation, Ownership Entity (including any cash 

and cash equivalents held directly or indirectly by such Ownership Entities) or Acquired 

Property listed on the Loan Schedule, and any loan into which any listed loan or Loan 

Participation is refinanced or modified, and includes with respect to each such loan, Loan 

Participation, Ownership Entity, Acquired Property or other related asset or Related Agreements: 

(i) any obligation evidenced by a Note; (ii) all rights, powers or Liens ofthe Company or any 

Ownership Entity in or under the Underlying Collateral and Underlying Collateral Documents 

and in and to Acquired Property (including all Ownership Entities and REO Property held by any 

Ownership Entity); (iii) all rights ofthe Company or any Ownership Entity pursuant to any 

Contract for Deed and in or to the real property that is subject to any such Contract for Deed; (iv) 

all rights ofthe Company or any Ownership Entity pursuant to any lease and in or to the related 

leased property; (v) all rights to causes of action, lawsuits, judgments, claims and demands of 

any nature available to or being pursued by or for the benefit ofthe Company or any Ownership 

Entity with respect to the Loans, the Underlying Collateral or the ownership, use, function, value 

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of or other rights pertaining thereto~ whether arising by way of counterclaim or otherwise~ other 

than any claims retained by the Initial Member pursuant to Section 2.7 ofthe Contribution 

Agreement; (vi) all guaranties, warranties, indemnities and similar rights in favor ofthe 

Company or any Ownership Entity with respect to any ofthe Loans; (vii) all rights ofthe 

Company or any Ownership Entity under the Related Agreements; and (viii) all rights ofthe 

Initial Member, the Failed Bank or SFG to any Deficiency Balances (as defined in the 

Contribution Agreement). 

"Loan Documents" shall mean all documents~ agreements~ certificates, instruments and 

other writings (including all Underlying Collateral Documents) now or hereafter executed by or 

delivered or caused to be delivered by any Borrower or any Obligor evidencing, creating, 

guaranteeing or securing, or otherwise executed or delivered in respect of, all or any part of a 

Loan or any Acquired Property or evidencing any transaction contemplated thereby, and all 

Modifications thereto. 

"Loan Participation" shall mean any loan listed on the Loan Schedule subject to a 

shared credit, participation, co-lending or similar intercreditor agreement under which the Initial 

Member, the Failed Bank, SFG, or the Receiver was, or the Company is, the lead or agent 

financial depository institution or otherwise managed or held the credit or sold participations, or 

under which the Initial Member, the Failed Bank, SFG or the Receiver was, or the Company is, a 

participating financial depository institution or purchased participations in a credit managed by 

another Person. 

"Loan Participation Agreement" shall mean an agreement under which the Initial 

Member, the Failed Bank, SFG or the Receiver was, or the Company is, the lead or agent 

financial depository institution or otherwise managed or held a shared credit or sold 

participations, or under which the Initial Member, the Failed Bank, SFG or the Receiver was, or 

the Company is, a participating financial depository institution or purchased participations in a 

credit managed by another Person. 

"Loan Proceeds" shall mean all ofthe following: (i) any and all proceeds with respect to 

any or all ofthe Loans and any or all ofthe Underlying Collateral, including principal, interest, 

default interest, prepayment fees, premiums and charges, extension and exit fees, late fees, 

assumption fees, other fees and charges, insurance proceeds and condemnation payments (or any 

portion thereof) that are not used and disbursed to repair, replace or restore the related 

Underlying Collateral in accordance with the terms ofthe Loan Documents and the Ancillary 

Documents, and, with respect to any Acquired Property, operating cash flow realized from such 

Acquired Property net of Servicing Expenses, whether paid directly to the Company or payable 

to or distributed by an Ownership Entity; (ii) any and all proceeds from sales or other 

dispositions or refinancings of any or all ofthe Loans (including Acquired Property) net of 

Servicing Expenses incurred in connection with such sale or other disposition or refinancing; (iii) 

any proceeds from making a draw under any letter of credit or certificate of deposit held with 

respect to any Loan, provided that such draw is permitted by the terms ofthe Loan Documents; 

(iv) any recoveries from the Borrowers or the Obligors of any kind or nature with respect to the 

Loans; (v) any deposits or down payments forfeited by prospective purchasers or lessees of any 

space at any Underlying Collateral; and (vi) any interest or other earnings accrued and paid on 

any ofthe amounts described in the foregoing clauses (i) through .(y} while held in the Collection 

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Account or any Other Account; provided, however, that, with respect to proceeds of any Loan 

Participation (including as a result of any sale or other disposition ofsuch Loan Participation or 

ofUnderlying Collateral relating thereto), the Loan Proceeds shall exclude any amounts payable 

to others under the applicable Loan Participation Agreement. 

"Loan Schedule" shall have the meaning given in the recitals ofthis Agreement. 

"Manager" shall have the meaning given in the preamble ofthis Agreement. 

"MERS" shall mean Mortgage Electronic Registration Systems, Incorporated. 

"MERS® System" shall mean the MERSCORP, Inc. mortgage electronic registry 

system, as more particularly described in the MERS Procedures Manual. 

"Modification" shall mean any extension, renewal, substitution, replacement, 

supplement, amendment or modification of any agreement, certificate, document, instrument or 

other writing, whether or not contemplated in the original agreement, document or instrument. 

"Note" shall mean each note or promissory note, lost instrument affidavit, loan 

agreement, Loan Participation Agreement, intercreditor agreement, reimbursement agreement, 

any other evidence of indebtedness of any kind, or any other agreement, document or instrument 

evidencing a Loan, and all Modifications to the foregoing. 

"Obligor" shall mean (i) any guarantor of all or any portion of any Loan or all or any of 

any Borrower's obligations set forth and described in the Loan Documents, or (ii) any other 

Person (other than the Borrower, the lender(s) and any administrative or other agent) that is 

obligated pursuant to the Loan Documents with respect to a Loan, and shall include the guarantor 

under any completion guaranty or similar document. 

"Other Accounts" shall have the meaning given in Section 2.8. 

"Ownership Entity" shall mean any direct wholly-owned subsidiary ofthe Company 

satisfying the requirements of an "Ownership Entity" as such term is defined in the LLC 

Operating Agreement, whether contributed or sold by the Initial Member to the Company on the 

Closing Date or formed or acquired by the Company thereafter. 

"Participated Loan" means a Loan originated by the Ihitial Member, SFG or any of 

their predecessors-in-interest as lead lender, a portion ofwhich was participated to one or more 

Persons and with respect to which the Initial Member, SFG or any oftheir predecessors-ininterest is the lead lender. 

"Paying Agent" shall mean the Paying Agent under the Custodial and Paying Agency 

Agreement. 

"Person" shall mean any individual, corporation, partnership (general or limited), limited 

liability company, limited liability partnership, firm, joint venture, association, joint-stock 

company, trust, estate, unincorporated organization, governmental or regulatory body or other 

entity. 

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"Pre-Existing Liabilities" shall have the meaning given in Section 8.4. 

"Prior Servicer" and "Prior Servicers" shall have the meaning given in Section 4.2(o). 

"Private Owner" shall have the meaning given in the recitals ofthis Agreement. 

"Purchase Money Notes Defeasance Date" shall have the meaning given in the LLC 

Operating Agreement. 

"Purchase Money Notes Guarantor" shall mean the FDIC, in its corporate capacity, as 

Purchase Money Purchase Money Notes Guarantor under the Purchase Money Notes Guaranty 

(as such terms are defined in the Custodial and Paying Agency Agreement) until the Purchase 

Money Notes Defeasance Date. 

"Qualified Servicer" shall mean any Person that (i) is properly licensed and qualified to 

conduct business in each jurisdiction in which such licenses and qualifications to conduct 

business are necessary for the servicing ofthe Loans and management ofthe Underlying 

Collateral and the Acquired Property, (ii) has the management capacity and experience to service 

loans ofthe type held by the Company, especially performing and non-performing construction 

loans secured by commercial properties, including the number and types of loans serviced, and 

the ability to track, process and post payments, to furnish tax reports to the Borrowers, to 

monitor construction, and to approve and disburse construction draws, (iii) either (x) has an 

Acceptable Rating or (y) is approved by and continues to be acceptable to the Manager in its sole 

discretion (it being understood that the Manager will not be permitted to grant such approval 

unless the Initial Member also consents, and may be required to withdraw such acceptance ifthe 

Initial Member so requests that the same be withdrawn), and (iv) in the event any ofthe serviced 

Loans are (or are required pursuant to the terms hereof to be) registered on the MERS® System, 

is a member ofMERS. 

"Receiver" shall have the meaning given in the recitals ofthis Agreement. 

"Regulation AB" shall mean the regulations at 17 C.F.R. §§229.1100, et seq., as the 

same may be amended from time to time. 

"Reimbursable Company Administrative Expenses" shall have the meaning given in 

the LLC Operating Agreement. 

"Reimbursement, Security and Guaranty Agreement" shall mean the Reimbursement, 

Security and Guaranty Agreement dated as ofthe Closing Date among the FDIC, acting in its 

corporate capacity and as Receiver and as Collateral Agent and as Revolver Lender, the 

Company, and the guarantors party thereto. 

"Related Agreement" shall mean (i) any agreement, document or instrument (other than 

the Note and Underlying Collateral Documents) relating to or evidencing any obligation to pay 

or securing any Loan (including any equipment lease, letter of credit, bankers' acceptance, draft, 

system confirmation of transaction, Loan history, affidavit, general collection information, and 

correspondence and comments relating to any obligation), (ii) any agreement relating to real 

property or rights in or to any real property (including leases, tenancies, concessions, licenses or 

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other rights of occupancy or use and security deposits related thereto), (iii) any collection, 

contingency fee, and tax and other service agreements (including those referred to in Section 4.2 

ofthe Contribution Agreement) that are specific to the Loans (or any ofthem) and that are 

assignable, (iv) any letter of assurance, letter of credit or similar instrument evidencing an 

obligation of SFG, the Failed Bank, the Initial Member, the Company or any Ownership Entity 

that was issued for the benefit of any Person and relates in any way to a Loan or the acquisition, 

development or construction of any project with respect to which the proceeds ofsuch Loan 

were used or were intended to be used, and (v) any interest rate swap arrangement between the 

Borrower and any of SFG, the Failed Bank, the Initial Member or the Company (in each case as 

the applicable lender, agent or other creditor under the Loan) that relates to any Loan. 

"Related Party" shall mean with respect to any Person, any party related to such Person 

in the manner delineated in 26 U.S.C.A § 267(b) and the regulations promulgated thereunder, as 

such law and regulations may be amended from time to time. 

"REO Property" shall mean any real property (and related personal property) included 

in the Acquired Property. 

"Restricted Servicer Change of Control" shall mean any Change of Control with 

respect to the Servicer that has not been approved in writing by the Initial Member and the 

Manager (which approval shall not be unreasonably withheld). 

"Retained Obligations" shall have the meaning given in Section 2.6. 

"Revolver" shall mean that certain Revolving Credit Agreement dated as ofthe Closing 

Date between the Company, as borrower, and the Initial Member, as lender (the Initial Member, 

in such capacity, together with its successors and assigns, the "Revolver Lender"). 

"Revolver Lender" shall have the meaning given in the definition of"Revolver". 

"Servicer" shall have the meaning given in the preamble ofthis Agreement. 

"Servicer Advances" shall mean advances made by or on behalf ofthe Servicer to fund 

Servicing Expenses. 

"Servicing Expenses" shall mean all customary and reasonable out-of-pocket fees, costs, 

expenses and indemnified amounts incurred in connection with servicing the Loans and the 

Acquired Property, including (i) any and all out-of-pocket fees, costs, expenses and indemnified 

amounts which a Borrower is obligated to pay to any Person or to reimburse to the lender, in 

each case, pursuant to the applicable Note or any other Loan Documents, including Escrow 

Advances, (ii) any and all reasonable out-of-pocket expenses necessary to protect or preserve the 

value ofthe Underlying Collateral or the priority ofthe Liens and security interests created by 

the Loan Documents relating thereto, including taxes, insurance premiums (including forced 

place insurance premiums), payment of ground rent, the costs of prevention of waste, repairs and 

maintenance, foreclosure expenses and legal fees and expenses relating to foreclosure or other 

litigation with respect to the Loans, (iii) any and all direct expenses related to the preservation, 

operation, management, leasing and sale ofthe Acquired Property (including real estate 

brokerage fees), (iv) Reimbursable Company Administrative Expenses, (v) subject to Section 4.6 

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ofthe LLC Operating Agreement (and excluding any amounts or claims the Private Owner is 

required to bear or indemnify pursuant to such Section 4.6), to the extent not covered by any of 

clauses (i) through (iv), legal fees and expenses (including judgments, settlements and reasonable 

attorneys fees) incurred by the Company, the Manager or the Servicer (including to reimburse 

any Subservicer) in its (or any Subservicer's) defense of claims asserted against the Company (or 

the Manager, the Servicer or any Subservicer) that relate to one (1) or more Loans or the conduct 

ofthe business ofthe Company, and allege, as the basis for such claims, any act or omission of 

the Company (or the Manager, the Servicer or any Subservicer) but only if (1) such claims are 

not attributable to any act or omission ofthe Company, the Manager, the Servicer or any 

Subservicer in a manner inconsistent with, or in violation of, the Servicing Standard or any ofthe 

provisions ofthis Agreement, the LLC Operating Agreement or any other Ancillary Document, 

and, (2) (x) such claims are decided and there are final non appealable orders or judgments 

(unless the Initial Member has agreed in writing that no appeal needs to be taken) in favor ofthe 

Company (or the Manager or the Servicer) or if decided against the Company (or the Manager or 

the Servicer) without any finding of bad faith, gross negligence or willful misconduct on the part 

of any ofthe foregoing, or (y) there is entered into a final settlement of any such claim with the 

prior written consent ofthe Initial Member, (vi) subject to Section 4.6 ofthe LLC Operating 

Agreement, (x) expenses incurred in accordance with Section 4.5(c) ofthe Contribution 

Agreement and (y) expenses incurred in connection with any litigation (including any 

bankruptcy action) included in the Obligations (as defined in the Contribution Agreement) and 

assumed pursuant to Section 4.5(a) or (b) or Section 4.6 ofthe Contribution Agreement, (vii) any 

and all fees, costs and expenses in connection with the registration ofthe Purchase Money Notes 

as described in Article 2 ofthe Custodial and Paying Agency Agreement, including the fees for 

the registration ofthe Purchase Money Notes with the Depository (as defined in the Custodial 

and Paying Agency Agreement)], and (viii) the costs of preparing, negotiating and recording any 

REO Mortgage (as defined in the Reimbursement, Security and Guaranty Agreement, including 

mortgage recording taxes) and the costs associated with the additional documentation required 

pursuant to Section 8.11 ofthe Reimbursement, Security and Guaranty Agreement, in each case 

pursuant to Section 8.11 ofthe Reimbursement, Security and Guaranty Agreement; provided, 

however, that Servicing Expenses shall not include any (A) Excluded Expenses, (B) costs of 

construction or any other costs or expenses to be funded using the proceeds ofthe Advance 

Loans under the Revolver, or (C) any other costs or expenses to be funded (or which, assuming 

relevant conditions are satisfied, could be funded) using Funding Draws. 

"Servicing Fee" shall have the meaning given in Secti~n 2.3. 

"Servicing Obligations" shall have the meaning given in Section 2.4. 

"Servicing Standard" shall have the meaning given in Section 2.4. 

"Servicing Transfer Date" shall mean, with respect to any particular Loan or Group of 

Loans, the later ofthe Effective Date and the applicable "Servicing Transfer Date" for such Loan 

or Group of Loans as defined in, and determined pursuant to, the Contribution Agreement. 

"SFG" shall mean Specialty Finance Group, LLC, a Georgia limited liability company 

and a wholly-owned subsidiary ofthe Failed Bank. 

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"Site Assessment" shall have the meaning given in Section 3.3. 

"Specified Date" shall mean the tenth (1Oth) day of each month, or such other day as is 

agreed to by the Servicer and the Manager, provided, however, that, in any case, if such day is 

not a Business Day, the Specified Date shall be the immediately preceding Business Day. 

"Specified Parent(s)" with respect to the Servicer shall mean any Person or Persons that 

the Manager and the Initial Member may agree from time to time shall be designated as the 

"Specified Parent" with respect to the Servicer; provided, that, (i) the Servicer' s initial Specified 

Parent is PNC Bank, National Association. 

"Subservicer" shall have the meaning given in Section 4.1. 

"Subservicing Agreement" shall have the meaning given in Section 4.2. 

"Termination Notice" shall mean any written notice oftermination required pursuant to 

Article VII. 

"Underlying Collateral'' shall mean any and all real or personal property, whether 

tangible, intangible or mixed, securing or pledged to secure a Loan, including (i) any account, 

equipment, guarantee or contract right, equity, partnership or other interest that is the subject of 

any Underlying Collateral Document and (ii) as the context requires, Acquired Property, whether 

or not expressly specified. 

"Underlying Collateral Document" shall mean any pledge agreement, security 

agreement, personal, corporate or other guaranty, deed oftrust, deed, trust deed, deed to secure 

debt, mortgage, contract for the sale ofreal property, assignment, collateral agreement, stock 

power or other agreement or document of any kind, whether an original or a copy, whether 

similar to or different from those enumerated, (i) securing in any manner the performance or 

payment by any Borrower or any Obligor ofits obligations or the obligations of any Borrower or 

any Obligor pursuant to any ofthe Loans or Notes evidencing the Loans, or (ii) evidencing 

ownership of any Acquired Property. 

"Uniform Commercial Code" shall mean the Uniform Commercial Code as in effect in 

any applicable jurisdiction, as amended from time to time. 

"Unpaid Principal Balance" shall mean, at any time, (i) when used in connection with 

multiple Loans, an amount equal to the aggregate then outstanding principal balance ofsuch 

Loans, and (ii) when used with respect to a single Loan, an amount equal to the then outstanding 

principal balance of such Loan; provided, however, that: 

(a) with respect to any Loan Participation (and any related Acquired 

Property), the Unpaid Principal Balance of such Loan Participation shall include only the 

Company's allocable share thereof in accordance with the applicable Loan Participation 

Agreement; 

(b) with respect to any Acquired Property that is included among the Loans on 

the Closing Date, the Unpaid Principal Balance of such Acquired Property shall initially be the 

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amount set forth on the Loan Schedule, as adjusted to its Adjusted Cut-Off Date Unpaid 

Principal Balance (as defined in, and determined pursuant to, the Contribution Agreement), and 

thereafter determined in the same manner as all other Acquired Property; 

(c) in the case of a Loan for which some or all ofthe related Underlying 

Collateral has been converted to Acquired Property (including REO Property), until such time as 

the Acquired Property (or any portion thereof) is liquidated, the Unpaid PrincipaL Balance of 

such Loan shall be deemed to equal the amount ofthe Unpaid Principal Balance ofsuch Loan 

(adjusted pro rata for debt forgiveness or retained indebtedness) at the time at which such Loan 

was converted to Acquired Property, plus, without duplication, any outstanding balance 

remaining on such Loan which is evidenced by a modification agreement or a replacement or 

successor promissory note executed by the Borrower, less the net proceeds of any sales of any 

portions ofthe Acquired Property effective after such conversion; and 

(d) the Unpaid Principal Balance with respect to any Acquired Property will 

be increased by the amount of, without duplication, (1) any Funding Draws or Advance Loans 

applied with respect thereto in accordance with this Agreement or any other Ancillary Document 

or the Revolver (as applicable), and (2) any Servicing Expenses capitalized thereto in accordance 

with Law to the extent that capitalizing such Servicing Expenses would have been permitted 

under the applicable Loan Documents prior to the conversion ofthe Loan to the Acquired 

Property. 

"Working Capital Expenses" shall mean any Servicing Expenses, Pre-Approved 

Charges (as such term is defined in the Contribution Agreement), Funding Draws (or permitted 

uses thereof, as the context may require), Management Fee, Interim Management Fee, Interim 

Servicing Fee (as each such term is defined in the LLC Operating Agreement) or fees ofthe 

Custodian and Paying Agent. 

"Working Capital Loans" shall have the meaning given in the Revolver. 

Section 1.2 Construction. This Agreement shall be construed and interpreted in 

accordance with the following: 

(a) References to "Mfiliates" include, with respect to any specified Person, 

only such other Persons which from time to time constitute "Affiliates" ofsuch specified Person, 

and do not include, at any particular time, other Persons that may have been, but at such time 

have ceased to be, "Affiliates" ofsuch specified Person, except to the extent that any such 

reference specifically provides otherwise. 

(b) The term "or" is not exclusive. 

(c) A reference to a Law includes any amendment, modification or 

replacement to such Law. 

(d) References to any document, instrument or agreement (including this 

Agreement) (a) shall be deemed to include all appendices, exhibits, schedules and other 

attachments thereto and all documents, instruments or agreements issued or executed in 

replacement thereof, and (b) shall mean such document, instrument or agreement, or replacement 

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thereto, as amended, modified and supplemented from time to time in accordance with its terms 

and as the same is in effect at any given time. 

(e) Unless otherwise specified, the words "hereof," "herein" and "hereunder" 

and words ofsimilar import shall refer to this Agreement as a whole and not to any particular 

provision ofthis Agreement. 

(f) The words "include" and "including" and words of similar-import are not 

limiting, and shall be construed to be followed by the words "without limitation," whether or not 

they are in fact followed by such words. 

(g) The word "during" when used with respect to a period oftime shall be 

construed to mean commencing at the beginning of such period and continuing until the end of 

such period. 

(h) Unless the context otherwise requires, singular nouns and pronouns when 

used herein shall be deemed to include the plural and vice versa and impersonal pronouns shall 

be deemed to include the personal pronoun ofthe appropriate gender. 

ARTICLE II 

SERVICING OBLIGATIONS OF THE SERVICER 

Section 2.1 Appointment and Acceptance as Servicer. Effective as ofthe Effective 

Date (and, with respect to each Loan or Group of Loans, as ofthe applicable Servicing Transfer 

Date with respect thereto), the Manager appoints the Servicer to service, administer, manage and 

dispose ofthe Loans and the Underlying Collateral on behalf of and as an agent ofthe Manager. 

Section 2.2 Limited Power of Attorney. The Manager hereby grants to the Servicer a 

limited power of attorney to execute all documents on its behalf (including as the "Manager" of 

the Company, in turn acting on behalf ofthe Company) in accordance with the Servicing 

Standard and as may be necessary to effectuate the Servicer's obligations under this Agreement 

until such time as the Manager revokes said limited power of attorney. Revocation ofthe limited 

power of attorney shall take effect upon (i) the receipt by the Servicer ofwritten notice thereof 

from or on behalf ofthe Manager, or (ii) termination ofthis Agreement pursuant to Article VII. 

Section 2.3 Servicing Fee. As consideration for sen:icing the Loans and the 

Underlying Collateral, the Manager shall pay the Servicer a servicing fee in the amount and at 

such times as are set forth on the Fee Schedule (the "Servicing Fee"). 

Section 2.4 Servicing Standard. The Servicer shall take such actions and perform such 

duties in connection with the servicing, administration, management and disposition ofthe Loans 

and the Underlying Collateral as are set forth on Schedule 2, as the same may be amended from 

time to time by the Manager and the Servicer (the "Servicing Obligations"). The Servicer shall 

perform its Servicing Obligations (i) in the best interests and for the benefit ofthe Company, (ii) 

in accordance with the terms ofthe Loans (and related Loan Documents), (iii) in accordance with 

the terms ofthis Agreement (including this Article II), (iv) in accordance with all Laws, (v) 

subject to Section 5.7, in accordance with the requirements ofthe LLC Operating Agreement, the 

Custodial and Paying Agency Agreement and the other Ancillary Documents, and (vi) to the 

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extent consistent with the foregoing terms, in the same manner in which a prudent servicer would 

service and administer similar loans and in which a prudent servicer would manage and 

administer similar properties for its own portfolio or for other Persons, whichever standard is 

higher, but using no less care and diligence than would be customarily employed by a prudent 

servicer following customary and usual standards ofpractice of prudent mortgage lenders, loan 

servicers and asset managers servicing, managing and administering similar loans and properties 

on an arms' length basis (the requirements in clauses (i) through (vi) collectively~ the "Servicing · 

Standard"). In addition, the Servicer shall perform its Servicing Obligations without regard to 

(a) any relationship that the Servicer, the Company, the Manager or any Subservicer or any of 

their respective Mfiliates may have to any Borrower, any Obligor or any oftheir respective 

Affiliates, including any other banking or lending relationship and any other relationship 

described in Section 5.1 (h), (b) the Company's, the Manager's, the Servicer' s or any 

Subservicer's obligation to make disbursements and advances with respect to the Loans and the 

Underlying Collateral, (c) any relationship that the Servicer or any Subservicer may have to each · 

other or to the Company, the Manager or any oftheir respective Affiliates, or any relationship 

that any oftheir respective Affiliates may have to the Company, the Manager or any oftheir 

respective Affiliates (other than the contractual relationship evidenced by this Agreement or any 

Subservicing Agreement), and (d) the Servicer's or any Subservicer's right to receive 

compensation (including the Servicing Fee) for its services under this Agreement or any 

Subservicing Agreement. 

Section 2.5 Collection Account. 

(a) The Servicer shall deposit into the Collection Account all Loan Proceeds 

on a daily basis (without deduction or setoff as provided in Section 11.2) within two (2) Business 

Days after receipt thereof by the Servicer. The Servicer shall not cause funds from any other 

source (other than interest or earnings on each ofthe Loan Proceeds, the proceeds ofWorking 

Capital Loans pursuant to the terms ofthe Revolver, and the proceeds ofExcess Working Capital 

Advances and Discretionary Funding Advances and other funds expressly permitted to be 

deposited into the Collection Account pursuant to the Custodial and Paying Agency Agreement) 

to be commingled in the Collection Account. 

(b) Except as otherwise directed by the Manager, any and all amounts on 

deposit in (or that are required to have been deposited into) the Collection Account (including 

interest and earnings thereon) shall be disbursed strictly in accordance with this Agreement 

(including the additional terms and conditions set forth in the Servicing Obligations) for 

purposes ofpayment of applicable Working Capital Expenses (including the making of 

applicable Funding Draws); provided, however, that ifthe Servicer or any Subservicer 

erroneously deposits any amounts into the Collection Account, it may withdraw such 

erroneously deposited amount. 

(c) Except as otherwise directed by the Manager, any and all amounts 

required to be remitted by the Servicer to the Collection Account under this Agreement shall be 

remitted by wire transfer, in immediately available funds. 

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(d) The Collection Account (and all funds therein) will be subject to an 

account control agreement among the Paying Agent, the Company, the Revolver Lender and the 

Collateral Agent. 

Section 2.6 Retained Obligations. As used herein, the "Retained Obligations" shall 

mean, collectively, the obligations ofthe "Servicer" described in Article 3 hereof and those 

obligations set forth on Schedule 2 attached hereto that are identified with an "x"_as an obligation 

to be performed by the Manager. Notwithstanding anything to the contrary set forth in this 

Agreement, the Servicer shall not be required to perform and/or satisfy the Retained Obligations 

and the Manager shall retain all responsibility for the performance and/or satisfaction ofthe 

same. When used in connection with the Retained Obligations all references to the Servicer 

shall, mutatis mutandis, be deemed a reference to Manager. 

Section 2.7 Escrow Accounts. Except as otherwise directed by the Manager, the 

Servicer shall establish and maintain one (1) or more Eligible Accounts, each of which shall be 

held in trust for the benefit ofthe Company and the Collateral Agent (each, an "Escrow 

Account", which term shall include all so-called "lockbox" accounts maintained under the Loan 

Documents and any other accounts maintained by the Company under the Loan Documents for 

amounts deposited or required to be deposited therein by the applicable Borrower). Except as 

otherwise directed by the Manager, the Servicer shall deposit into the applicable Escrow Account 

on a daily basis all collections from the Borrowers for the payment oftaxes, assessments, hazard 

insurance premiums, and comparable items for the account ofthe Borrowers, and all other 

amounts required to be deposited in such Escrow Account pursuant to the applicable Loan 

Documents; it being agreed and understood that such deposited amounts shall not be deemed 

Loan Proceeds. The Servicer shall pay to the Borrowers interest on funds in Escrow Accounts to 

the extent required by Law or the applicable Loan Documents. 

Section 2.8 Other Accounts. At the direction ofthe Manager, the Servicer shall 

establish and maintain such other Eligible Accounts as may be directed by the Manager, each of 

which shall be held in trust for the benefit ofthe Company and the Collateral Agent, and shall be 

funded and disbursed only in accordance with such instructions as are provided by the Manager 

("Other Accounts"). 

Section 2.9 

Coverage. 

Maintenance of Insurance Policies; Errors and Omissions and Fidelity 

(a) The Servicer and each Subservicer shall cause insurance coverage to be 

maintained for the Underlying Collateral (including any Acquired Property) as required under 

the Revolver, the Reimbursement, Security and Guaranty Agreement and the LLC Operating 

Agreement, including, whether or not so required (but in all events subject to the requirements in 

LLC Operating Agreement and, for so long as the same remain in effect the Reimbursement, 

Security and Guaranty Agreement), insurance from an insurer reasonably acceptable to the 

Manager for each Loan with respect to which the Borrower has failed to maintain required 

insurance, fire, hurricane, flood and hazard insurance with extended coverage as is customary in 

the area in which the Underlying Collateral is located and in such amounts and with such 

deductibles as, from time to time, is directed by the Manager. 

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(b) The Servicer and each Subservicer shall maintain each of the following 

types of insurance coverage having such limits as described below: 

(i) Errors & Omissions Liability with limits of not less than 

$10,000,000 per claim and $10,000,000 in the aggregate. The Manager shall be 

notified immediately upon the reduction of or potential reduction of fifty percent 

(50%) of the limits. The Manager may require that the Servicer and each 

Subservicer purchase additional limits to provide back to the required limits as 

stated above. "Potential reduction of fifty percent (50%)" shall mean any 

knowledge by the Servicer or Subservicer, as applicable, that a claim or the sum 

of all claims, current or initiated after the effective date of the policy which would 

reduce the limits by fifty percent (50%). 

(ii) Directors & Officers Liability with limits of not less than 

$10,000,000 each claim and $10,000,000 in the aggregate. 

(iii) Crime Insurance or a Fidelity Bond in an amount of not less than 

$10,000,000 covering employee theft, forgery & alteration, wire/funds transfer, 

computer fraud, client coverage. Such coverage shall insure all employees or any 

other persons authorized by the Servicer or Subservicer to handle any funds, 

money, documents and papers relating to any Loan, and shall protect the Servicer 

or Subservicer, as applicable, against losses arising out of theft, embezzlement, 

fraud, misplacement, and other similar causes. The Manager and the Company 

shall each be named as a loss payee with respect to claims arising out of assets 

handled under this Agreement or any applicable Servicing Agreement or 

Subservicing Agreement. 

(iv) General Liability with limits of not less than $1,000,000 each 

occurrence, $2,000,000 in the aggregate, including coverage for 

products/completed operations, advertising and personal injury. The Manager 

and the Company shall each be named as additional insured. The policy shall 

include a Waiver of Subrogation in favor ofthe Manager and the Company. 

(v) Auto Liability with a combined single limit of not less than 

$1,000,000 to provide coverage for any owned, ~ired, or non-owned vehicles. 

(vi) Workers Compensation in such amount as required by the states in 

which the Servicer or Subservicer, as applicable, operates, including coverage for 

Employer's Liability in an amount not less than, $1,000,000. The policy shall 

include a Waiver of Subrogation in favor of the Manager and the Company. 

(vii) Umbrella Liability in an amount of not less than $10,000,000 each 

occurrence and in the aggregate. 

All such policies shall be written with carriers having a minimum insurer rating of A- VIII from 

A.M. Best and A from Standard & Poor's. All such policies shall have a minimum notice of 

cancellation of thirty (30) days, except for non-payment ofpremium whereby a ten (10) day 

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notice of cancellation is acceptable. Certificates shall show each ofthe Manager and the 

Company as certificate holder, or as otherwise designated by the language in clauses @-(vii) 

above. 

The Servicer shall provide (or shall cause each Subservicer to provide) the Purchase Money 

Notes Guarantor, the Revolver Lender, the Manager and the Initial Member with certificates 

evidencing all such policies on the Effective Date (and, with respect to each Loa11 the applicable 

Servicing Transfer Date with respect thereto) and each anniversary ofthe Closing Date 

thereafter, and otherwise upon request ofthe Manager, the Purchase Money Notes Guarantor, the 

Revolver Lender or the Initial Member. Copies of fidelity bonds and insurance policies required 

to be maintained pursuant to this Section 2.9 shall be made available to the Manager, the 

Purchase Money Notes Guarantor, the Revolver Lender and the Initial Member or their 

respective representatives on the Effective Date (and, with respect to each Loan, on the 

applicable Servicing Transfer Date with respect thereto), and shall otherwise be made available 

to any ofthe Manager, the Purchase Money Notes Guarantor, the Revolver Lender and the Initial 

Member and their respective representative upon request. 

Section 2.10 Funding of Working Capital Expenses and Funding Draws. To the extent 

set forth in, and subject to the terms of, this Agreement (including the Servicing Obligations), the 

Servicer shall, on behalf ofthe Manager, in turn acting on behalf ofthe Company (and from 

Company funds made available by the Manager), make applicable Funding Draws and pay other 

applicable Working Capital Expenses; provided that the making of the same is consistent with 

the applicable terms and conditions in the Custodial and Paying Agency Agreement and, subject 

to Section 5.7, the applicable terms and conditions in the LLC Operating Agreement, the 

Revolver and the other Ancillary Documents. The Servicer acknowledges that (a) proceeds of 

Discretionary Funding Advances shall be used exclusively for making Funding Draws with 

respect to specified Loans or related Acquired Property (and in no event may Discretionary 

Funding Advances be used for payment of any Working Capital Expenses other than Funding 

Draws); and (b) proceeds of Excess Working Capital Advances shall be used exclusively for 

payment Working Capital Expenses other than Funding Draws (and in no event may Excess 

Working Capital Advances be used for the making of any Funding Draws) and for such other 

purposes as may be expressly permitted pursuant to the Revolver and the LLC Operating 

Agreement. 

Section 2.11 Expenses. Except as otherwise directed by the Manager, the Servicer shall 

use its reasonable best efforts to recover from the Borrowers arid the Obligors all amounts of 

Servicing Expenses that are advanced by the Servicer (as permitted or required pursuant to the 

Servicing Obligations) as Servicer Advances to the extent that the Borrowers and Obligors are 

responsible for such Servicing Expenses under the Loan Documents. All such amounts not 

recovered from the Borrowers or the Obligors and all other Servicer Advances shall be 

reimbursed only in accordance with the terms set forth on Schedule 3 attached hereto, as the 

same may be amended from time to time by the Manager (without the consent ofthe Initial 

Member) and the Servicer. In no event may any Servicer Advances be deductible from or netted 

against any Loan Proceeds. In the event the Servicer is reimbursed for any amount that does not 

qualify as a Servicing Expense, the Servicer shall be obligated to refund such amounts to the 

Manager, or, if so directed by the Manager, directly to the Company (to the Collection Account) 

on the Specified Date immediately following the Servicer's receipt of notice from the Manager 

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requesting the same. No Servicer Advances shall bear interest chargeable in any way to the 

Company or deductible from any Loan Proceeds. 

Section 2.12 Insured or Guaranteed Loans. If any Loans being serviced pursuant to this 

Agreement are insured or guaranteed by any Governmental Authority, the Servicer 

acknowledges and agrees that, if the Manager so directs pursuant to the Servicing Obligations 

with respect to such Loans, it shall take any and all actions as may be necessary tp insure that 

such insurance or guarantees remain in full force and effect. The Servicer acknowledges and 

agrees that, upon assumption ofthe Servicing Obligations with respect to the Loans pursuant to 

this Agreement, it agrees to fulfill all of the Company's obligations under the contracts of 

insurance or guaranty. 

Section 2.13 Registration with MERS. In the event that any ofthe Loans are (or are 

required by the Servicing Obligations to be) registered on the MERS® System, the Servicer shall 

maintain (or register, as applicable) such Loan on the MERS® System and execute and deliver 

on behalf of the Company any and all instruments of assignment and other comparable 

instruments with respect to such assignment or re-recording of a mortgage securing a Loan in the 

name of MERS®, solely as nominee for the Company and its successors and assigns. The 

Manager shall be designated as the "servicer" and the "investor" with respect to the Loans that 

are registered on the MERS® System, and the Servicer shall be designated as the "subservicer" 

with respect to such Loans. No other Person shall be identified on the MERS® System as 

having any interest in any of the Loans unless otherwise consented to by the Manager. All Loans 

registered on the MERS® System shall remain registered on the MERS® System unless default, 

foreclosure or similar legal or MERS® requirements dictate otherwise. The Servicer shall 

provide the Manager and the Initial Member with such reports from the MERS® System as the 

Manager or the Initial Member, from time to time, may request, including to allow the Manager 

and the Initial Member to verify the Persons identified on the MERS® System as having any 

interest in any ofthe Loans and to confirm that the Loans required to be registered on the 

MERS® System are so registered. Without limiting the foregoing, upon the request ofthe 

Manager or the Initial Member, the Servicer shall cause MERS® to run a query with respect to 

any and all specified fields on the MERS® System with respect to any or all of the Loans 

registered on the MERS® System and provide the results to the Manager and the Initial Member 

and, if requested by the Manager or the Initial Member, shall cause MERS® to change the 

information in such fields, to the extent MERS® will do so in accordance with its policies and 

procedures, to reflect its instructions. 

ARTICLE III 

LOAN DEFAULTS; ACQIDSITION OF COLLATERAL 

Section 3.1 Delinquency Control. Except as otherwise directed by the Manager, the 

Servicer shall maintain a collection department that substantially complies with the Servicing 

Standard and protects the Company's interests in the Loans and the Underlying Collateral in 

accordance with the Servicing Standard. 

Section 3.2 Discretion of the Servicer in Responding to Defaults of Borrower. Upon 

the occurrence of an event of default under any of the Loan Documents, but subject to the other 

terms and conditions of this Agreement, including the Servicing Obligations ofthe Servicer and 

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such direction as the Manager may otherwise provide that is consistent with the Servicer' s 

compliance with the Servicing Standard, the Servicer, with the consent ofthe Manager, shall 

cause to be determined the response to such default and course of action with respect to such 

default, including (a) the selection of attorneys to be used in connection with any action, whether 

judicial or otherwise, to protect the interests of the Company in the Loan and the Underlying 

Collateral, (b) the declaration and recording of a notice of such default and the acceleration of 

the maturity ofthe Loan, (c) the institution of proceedings to foreclose on the Loan Documents, 

Underlying Collateral or Acquired Property securing the Loan pursuant to the power of sale 

contained therein or through a judicial action, (d) the institution ofproceedings against any 

Obligor, (e) the acceptance of a deed in lieu of foreclosure, (f) the purchase ofthe real property 

Underlying Collateral at a foreclosure sale or trustee's sale or the purchase ofthe personal 

property Underlying Collateral at a Uniform Commercial Code sale, and (g) the institution or 

continuation of proceedings to obtain a deficiency judgment against such defaulting Borrower or 

any Obligor and the collection of such judgment. Notwithstanding anything to the contrary 

contained herein, but subject to Section 5.7, the Servicer shall not, in connection with any such 

default or otherwise, take (or refrain from taking) any action ifthe taking (or refraining from 

taking) of such action is inconsistent with the terms ofthe Revolver, the LLC Operating 

Agreement or any other Ancillary Documents or any applicable Approved Business Plans 

without the prior written consent of the Manager. 

Section 3.3 Acquisition of Acquired Prooertv. Any acquisition ofUnderlying 

Collateral shall conform with the terms and conditions ofthis Agreement (including the 

Servicing Obligations of the Servicer). With respect to any Loan as to which the Servicer has 

received actual notice of, or has actual knowledge of, any Environmental Hazard with respect to 

the related Underlying Collateral, the Servicer shall immediately provide written notice of same 

to the Manager. In addition, if the Manager so directs, prior to the acquisition of title to any 

Underlying Collateral, the Servicer shall cause to be commissioned with respect to such 

Underlying Collateral (i) a "Transaction Screen Process" consistent with ASTM Standard E 

1528-06, by an environmental professional or (ii) such other site inspections and assessments by 

a Person who regularly conducts environmental audits using customary industry standards as 

would customarily be undertaken or obtained by a prudent lender in order to ascertain whether 

there are any actual or threatened Environmental Hazards (a "Site Assessment"), and the cost of 

such Site Assessment shall be deemed to be a Servicing Expense as long as the costs for such 

Site Assessment were not paid to any Affiliate of the Manager or any Affiliate of the Servicer or 

any Subservicer. Except as is otherwise directed by the Manager, the Servicer or any 

Subservicer shall not acquire or otherwise cause the Company or any sub&idiary or other entity in 

which the Company owns any interest to acquire all or any portion of any Underlying Collateral 

having any actual or threatened Environmental Hazard by foreclosure, deed in lieu of 

foreclosure, power of sale or sale pursuant to the Uniform Commercial Code or otherwise. If 

title to any Underlying Collateral that constitutes real property is to be acquired by foreclosure, 

by deed in lieu of foreclosure, by power of sale or by sale pursuant to the Uniform Commercial 

Code, or otherwise, title to such Acquired Property shall be taken by and held in the name of an 

Ownership Entity; provided, however, that for any Underlying Collateral which becomes 

Acquired Property after the Servicing Transfer Date relating thereto and with respect to which 

there exists any Environmental Hazard, the Ownership Entity that holds such Underlying 

Collateral may hold title only to the relevant Underlying Collateral with respect to which the 

Environmental Hazard exists. 

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Section 3.4 Administration ofREO Properties. In addition to any other terms and 

conditions set forth herein, in connection with any REO Properties, the Servicer shall, in each 

case subject to applicable instructions :from the Manager and the Servicing Obligations, comply 

with the following terms and conditions: 

(a) The Servicer shall cause the applicable Ownership Entity to maintain 

insurance in compliance with applicable requirements herein and in the LLC Opesating 

Agreement. 

(b) The Servicer shall cause the applicable Ownership Entity to (i) perform 

the obligations that such Ownership Entity is required to perform under the leases to which it is a 

party in all material respects and (ii) enforce, in accordance with commercially reasonable 

practices for properties similar to the applicable REO Property, the material obligations to be 

performed by the tenants under such leases. 

(c) The Servicer shall not permit any Ownership Entity to initiate or consent 

to any zoning reclassification of any portion ofthe REO Property owned by such Ownership 

Entity, or use or permit the use of any portion of an REO Property in any manner that could 

result in such use (taking into account any applicable variance obtained in accordance with the 

Servicing Standard) becoming a non-conforming use under any zoning ordinance or any other 

applicable land use law, rule or regulation, without the prior consent ofthe Manager, the 

Collateral Agent, the Revolver Lender and the Initial Member. 

(d) The Servicer shall not permit any Ownership Entity to suffer, permit or 

initiate the joint assessment of REO Property (i) with any other real property constituting a Tax 

lot separate :from such REO Property, and (ii) with any portion of an REO Property which may 

be deemed to constitute personal property, or any other procedure whereby the Lien of any Taxes 

which may be levied against such personal property shall be assessed or levied or charged to 

such REO Property. 

(e) From and after the completion of any buildings or other improvements at 

an REO Property, the Servicer shall cause the applicable Ownership Entity to maintain such 

REO Property in a good and safe condition and repair (subject to such alterations as the Manager 

may from time to time determine to be appropriate in accordance with the Servicing Standard 

and applicable requirements herein and in the Ancillary Documents) and in accordance with 

Law. 

(f) All property managers with respect to any REO Property shall, in their 

respective property management agreements or by separate agreement, subordinate their rights 

under such agreements (including their right to receive management fees) to the rights and 

interest ofthe Collateral Agent and the Revolver Lender under the applicable REO Mortgage (as 

defined in the Reimbursement, Security and Guaranty Agreement). 

(g) With respect to any REO Property that is leased under a ground or other 

lease (in each case, a "ground lease"), the Servicer shall cause the applicable Ownership Entity 

to (i) pay all rents and other sums required to be paid by the tenant under and pursuant to the 

provisions ofthe applicable ground lease as and when such rent or other charge is payable, and 

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(ii) diligently and timely perform and observe all of the terms, covenants and conditions binding 

on the tenant under the ground lease. The Servicer shall not permit the applicable Ownership 

Entity to subordinate or consent to the subordination of any ground lease to any mortgage, lease 

or other interest on or in the ground lessor's interest in the applicable REO Property without the 

prior consent ofthe Manager, the Revolver Lender and the Collateral Agent unless such 

subordination is required under the provisions of such ground lease. 

(h) In the event the Manager elects to fund the construction of the REO 

Property (pursuant to Funding Draws for such purpose), then the Servicer shall cause each 

Ownership Entity to pursue with diligence the construction ofthe REO Property owned by such 

Ownership Entity (i) in accordance with the construction, construction management (if any) and 

all other material contracts relating to such construction, and all requirements of Law, all 

restrictions, covenants and easements affecting such REO Property, and all applicable 

governmental approvals, (ii) in substantial compliance with the plans and specifications therefor 

as in existence on the Closing Date and as thereafter modified by the Manager (or the Servicer, 

to the extent permitted in the Servicing Obligations), (iii) in a good and workmanlike manner and 

free of defects, (iv) in a manner such that such REO Property remains free from any Liens, 

claims or assessments (actual or contingent) for any material, labor or other item furnished in 

connection therewith, and (v) in conformance with the requirements for Funding Draws. 

(i) Notwithstanding any other provision ofthis Section 3.4 to the contrary, (i) 

in operating, managing, leasing or disposing of any REO Property, the Servicer shall act in the 

best interests of the Company, and the members and creditors ofthe Company (including the 

FDIC in its various capacities) and in accordance with the Servicing Standard, and (ii) without 

relieving the Servicer of any obligation elsewhere in this Agreement, and subject to any 

applicable Servicing Obligations, the Servicer shall not be required to act in accordance with a 

specific provisions ofthis Section 3.4 if such action is (A) not in the best interests of the 

Company and the members and creditors of the Company (including the FDIC in its various 

capacities), as determined by the Servicer in the exercise of its reasonable discretion, or (B) not 

in accordance with the Servicing Standard. 

G) The Servicer shall furnish to the Manager, the Revolver Lender, the 

Collateral Agent and the Initial Member such reports regarding the construction, leasing and 

sales efforts of or relating to the REO Property as the Manager, the Revolver Lender, the 

Collateral Agent or the Initial Member shall reasonably request. 

ARTICLE IV 


SUBSERVICING 


Section 4.1 Retention of Subservicer. The Servicer may engage or retain one or more 

subservicers, including Affiliates ofthe Manager or of the Servicer (individually and 

collectively, "Subservicer"), as it may deem necessary and appropriate, provided that any 

Subservicer meets the requirements set forth in the definition of "Qualified Servicer". 

Section 4.2 Subservicing Agreement Requirements. Any subservicing agreement with 

any Subservicer ("Subservicing Agreement") shall, among other things: 

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(a) provide for the servicing ofthe Loans and management ofthe Underlying 

Collateral by the Subservicer in accordance with the Servicing Standard and the other terms of 

the Servicing Agreement and the LLC Operating Agreement; 

(b) be terminable upon no more than thirty (30) days prior notice in the event 

of any Event ofDefault (as defined in the LLC Operating Agreement), any Default under this 

Agreement or any default under the Subservicing Agreement as set forth in Section 4.2(m); 

(c) provide that the Servicer as well as the Manager and the Initial Member 

shall each be entitled to exercise termination rights thereunder; 

(d) provide that the Subservicer and the Servicer acknowledge that the 

Subservicing Agreement constitutes a personal services agreement between the Servicer and the 

Subservicer; 

(e) provide that each ofthe Initial Member and the Manager is a third party 

beneficiary under the Subservicing Agreement for all purposes and is entitled to enforce the 

Subservicing Agreement, and that each ofthe FDIC, the Purchase Money Notes Guarantor, the 

Revolver Lender and the Company is a third party beneficiary thereunder to the extent of any 

rights expressly granted to such Person under the Subservicing Agreement (and such 

Subservicing Agreement shall include rights in favor ofthe FDIC, the Purchase Money Notes 

Guarantor, the Revolver Lender and the Company that are equivalent to the rights granted to 

such Persons hereunder) and is entitled to enforce the Subservicing Agreement with respect to 

such rights; and further provide that in no event shall any amendment or waiver to any such 

Subservicing Agreement limit or affect any rights of any such third party beneficiary thereunder 

without the express written consent of such third party beneficiary; 

(f) provide that (i) upon the occurrence of any Default under the Subservicing 

Agreement, each ofthe Manager (or applicable successor "Manager" under the LLC Operating 

Agreement) and the Initial Member may exercise all ofthe rights ofthe Servicer under the 

Subservicing Agreement and cause the termination or assignment ofthe Subservicing Agreement 

to any other Person, without penalty or payment of any fee, and (ii) ifthe Initial member (or any 

successor "Manager" under the LLC Operating Agreement) exercises its right in Section 7.2 to 

cause the termination or assignment ofthe Servicing Agreement from the Manager to any other 

Person, the Initial Member or such successor Manager shall also have the right to cause the 

termination or assignment ofthe Subservicing Agreement, without penalty or payment of any 

fee; 

(g) provide that the Initial Member, the Manager, the Purchase Money Notes 

Guarantor, the Revolver Lender and the Company (and each oftheir respective representatives) 

shall each have access to and the right to review, copy and audit the books and records ofthe 

Subservicer and that the Subservicer shall make available its officers, directors, employees, 

accountants and attorneys to answer the Initial Member's, the Manager's, the Purchase Money 

Notes Guarantor's, the Revolver Lender's and the Company's (and each oftheir respective 

representatives') questions or to discuss any matter relating to the Subservicer's affairs, fmances 

and accounts, as they relate to the Loans, the Underlying Collateral, the Servicing Obligations, 

the Collection Account, the Escrow Accounts or any Other Accounts established or maintained 

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pursuant to the Servicing Agreement or the Subservicing Agreement, accounts created under the 

Revolver or the Custodial and Paying Agency Agreement or any matters relating to the Servicing 

Agreement or the Subservicing Agreement or the rights or obligations thereunder; 

(h) provide that all Loan Proceeds are to be deposited into the Collection 

Account on a daily basis (without reduction or setoff as provided in Section 11.12) within two 

(2) Business Days ofreceipt and that under no circumstances are any funds, other than Loan 

Proceeds and interest and earnings thereon and on the proceeds ofWorking Capital Loans 

pursuant to the Revolver and Excess Working Capital Advances and Discretionary Funding 

Advances, to be commingled into the Collection Account; 

(i) provide that the Subservicer shall not sell, transfer or assign its rights 

under the Subservicing Agreement with the Servicer and that any prohibited sale, transfer or 

assignment shall be void ab initio; 

G) provide that the Subservicer consents to the immediate termination ofthe 

Subservicer pursuant to Section 7 .2; 

(k) provide that there shall be no right of setoffon the part ofthe Subservicer 

against the Loan Proceeds (or the Company); 

(1) provide for such other matters as are necessary or appropriate to ensure 

that the Subservicer is obligated to comply with the Servicing Obligations ofthe Servicer under 

the Servicing Agreement in the conduct of such matters as are delegated to the Subservicer; 

(m) (i) contain default provisions that relate to the actions ofthe Subservicer 

that correspond to the provisions of Section 7.1 (a), .(hl, .(£}, @, W, ffi, and .{g} hereof, and (ii) 

provide that each ofthe Manager and the Initial Member has the right (x) to terminate the 

Subservicing Agreement by providing written notice upon the occurrence of any such default, 

without any cure period other than as may be provided for in such default provisions under such 

Subservicing Agreement (which cure periods shall be no longer than the cure provisions in the 

corresponding provisions of Section 7.1 ofthis Agreement), and (y) otherwise to enforce the 

rights of the Servicer under the Subservicing Agreement; 

(n) provide that (i) the Subservicer consents to its immediate termination 

under the Subservicing Agreement upon the occurrence of any ,of (x) a Default under Section 

7.1Cb) ofthis Agreement, or (y) an Insolvency Event with respect to the Subservicer or any ofits 

Related Parties, and (ii) the occurrence of any Insolvency Event with respect to the Subservicer 

or any of its Related Parties constitutes a default under the Subservicing Agreement; 

(o) provide a full release and discharge ofthe Initial Member, the Company, 

the Existing Servicers (as defined in the Contribution Agreement), the FDIC, in relation to any 

particular Loan, SFG, the Failed Bank and any predecessor-in-interest thereof, any Ownership 

Entities existing as ofthe applicable Servicing Transfer Date, and all oftheir respective officers, 

directors, employees, agents, attorneys, contractors and representatives, and all oftheir 

respective successors, assigns and Affiliates (but excluding, in all cases, the Manager) (any such 

Person, a "Prior Servicer" and collectively, the "Prior Servicers"), from any and all claims 

(including any counterclaim or defensive claim), demands, causes of action, judgments or legal 

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proceedings and remedies ofwhatever kind or nature that the Subservicer had, has or might have 

in the future, whether known or unknown, which are related in any manner whatsoever to the 

servicing ofthe Loans by any Prior Servicer prior to the applicable Servicing Transfer Date 

(other than due to gross negligence, violation of Law or willful misconduct ofsuch Prior 

Servicer); 

(p) provide that all Loans registered on the MERS® System s:Qall remain 

registered unless default, foreclosure or similar legal or MERS requirements dictate otherwise; 

(q) provide that the Subservicer shall immediately notify the Manager and the 

Initial Member upon becoming aware of any Subservicer or any Affiliate thereof at any time, (i) 

being or becoming a partner or joint venturer with any Borrower or Obligor, (ii) being or 

becoming an agent of any Borrower or Obligor, or allowing any Borrower or Obligor to be an 

agent of such Subservicer or of any Affiliate thereof, or (iii) having any interest whatsoever in 

any Borrower or Obligor; and 

(r) not conflict with the Servicing Standard or any other terms or provisions 

ofthis Agreement, the LLC Operating Agreement, the Revolver, the Custodial and Paying 

Agency Agreement or any ofthe other Ancillary Documents insofar as such other terms or 

provisions apply to the Subservicer or the Servicing Obligations. Nothing contained in any 

Subservicing Agreement shall alter any obligation ofthe Servicer under this Agreement or the 

Manager under the LLC Operating Agreement and, in the event of any inconsistency between 

the Subservicing Agreement and the terms of either this Agreement or the LLC Operating 

Agreement, the terms ofthis Agreement or the LLC Operating Agreement, as applicable, shall 

apply. 

Section 4.3 Servicer Liable for Subservicers. Notwithstanding anything to the 

contrary contained herein, the use of any Subservicer shall not release the Servicer from any of 

its Servicing Obligations or other obligations under this Agreement, and the Servicer shall 

remain responsible and liable for all acts and omissions of each Subservicer as fully as if such 

acts and omissions were those ofthe Servicer. All actions of any Subservicer performed 

pursuant to the Subservicing Agreement with the Servicer shall be performed as an agent ofthe 

Servicer. No Subservicer shall be paid any fees or indemnified out of any Loan Proceeds, it 

being understood that all fees and related costs and liabilities of retaining any Subservicers shall 

be the sole responsibility ofthe Servicer. 

Section 4.4 Manager Approval Required. Each Subservicing Agreement and all 

Modifications thereto and the selection ofthe Subservicer (subject to the requirements of Section 

4.1 hereof), regardless ofwhether the Subservicer is an Mfiliate ofthe Servicer, shall be subject 

to the prior written approval ofthe Manager (which approval shall not be unreasonably withheld, 

delayed or conditioned so long as the provisions required under Section 4.2 are not modified or 

deleted). A copy of all Subservicing Agreements, as executed and delivered and all amendments 

thereto, shall be provided to the Manager. 

Section 4.5 Regulation AB Requirements. The Servicer shall use commercially 

reasonable efforts to maintain in place, and to confirm, where applicable, that each Subservicer 

has in place, policies and procedures to comply with the relevant servicing criteria provisions of 

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Section 1122( d)( 1) ofRegulation AB that are applicable and relate to the servicing being 

conducted under this Agreement, including for purposes ofpreparation and delivery ofthe 

annual reports (including the independent accountant report) required pursuant to Section 5.2(g) 

below; provided that the following Regulation AB criteria shall not be deemed relevant to the 

servicing being conducted under this Agreement: Section 1122( d)( 1)(iii) regarding backup 

servicer requirements; Sections 1122(d)(3)(i-iv) regarding paying agent requirements; and 

Section 1122(d)(4)(xv) regarding external credit enhancement. 

ARTICLEV 

REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SERVICER 

Section 5.1 Representations and Warranties. The Servicer hereby makes the following 

representations and warranties as ofthe Effective Date: 

(a) The Servicer (i) is a corporation, duly organized, validly existing and in 

good standing under the laws ofthe State of Delaware, (ii) has qualified or will qualify to 

transact business as a foreign entity and will remain so qualified, in the state or states and other 

jurisdictions where the Loans or the nature ofthe Servicer's activities under this Agreement 

makes such qualification necessary, (iii) has all licenses and other governmental approvals 

necessary to carry on its business as now being conducted and to perform its obligations 

hereunder, and (iv) has established and shall maintain its principal place of business in the 

United States. 

(b) The Servicer has all requisite power, authority and legal right to service 

each Loan, and to execute, deliver and perform, and to enter into and consummate the 

transactions contemplated by, this Agreement, and this Agreement has been duly authorized by 

all requisite corporate action on the part ofthe Servicer. 

(c) This Agreement and all Ancillary Documents and other agreements 

contemplated hereby to which the Servicer is or will be a party constitute the valid, legal, binding 

and enforceable obligations ofthe Servicer, except as such enforcement may be limited by 

bankruptcy, insolvency, reorganization or other similar laws affecting the enforcement of 

creditors' rights generally, and by general principles of equity (regardless ofwhether such 

enforcement is considered in a proceeding in equity or at law); and all requisite corporate action 

has been taken by the Servicer to make this Agreement and all Ancillary Documents and other 

agreements contemplated hereby to which the Servicer is or will be a party valid and binding 

upon the Servicer in accordance with their terms and conditions. 

(d) The Persons executing this Agreement on behalf ofthe Servicer are duly 

authorized to do so. 

(e) The execution and delivery ofthis Agreement by the Servicer, the 

servicing ofthe Loans and the Underlying Collateral under this Agreement, the consummation of 

any other ofthe transactions contemplated by this Agreement, and the fulfillment ofor 

compliance with the terms hereof are in the ordinary course of business ofthe Servicer and will 

not (i) result in a breach of any term or provision ofthe articles or charter or bylaws or other 

organizational documents ofthe Servicer, (ii) conflict with, result in a breach, violation or 

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acceleration of, or result in a default (or an event which, with notice or lapse oftime, or both, 

would constitute a default) under the terms of any agreement or other instrument to which the 

Servicer is a party or by which it may be bound, or (iii) constitute a violation of any Law 

applicable to the Servicer, and the Servicer is not in breach or violation of any agreement or 

instrument, or in violation of any Law of any Governmental Authority having jurisdiction over it 

which breach or violation may impair the Servicer' s ability to perform or meet any of its 

obligations under this Agreement. 

(f) No litigation is pending or, to the Servicer's knowledge, threatened, 

against the Servicer that would prohibit the Servicer from entering into this Agreement or is 

likely to materially and adversely affect either the ability ofthe Servicer to perform its 

obligations under this Agreement or the financial condition ofthe Servicer. 

(g) Any consent, approval, authorization or order of any Governmental 

Authority required for the execution, delivery and performance by the Servicer of or compliance 

by the Servicer with this Agreement or the consummation ofthe transactions contemplated by 

this Agreement has been obtained and is effective. 

(h) Neither the Servicer nor any Subservicer or their respective Controlled 

Affiliates shall, at any time, (i) be a partner or joint venturer with any Borrower or Obligor, (ii) 

be an agent of any Borrower or Obligor, or allow any Borrower or Obligor to be an agent ofthe 

Servicer or any Subservicer or any such Controlled Affiliate of either, or (iii) have any interest 

whatsoever in any Borrower or Obligor. 

(i) The Servicer is, and all times so long as this Agreement is in effect shall 

remain, a Qualified Servicer. 

Section 5.2 Reporting, Books and Records and Compliance Covenants. The Servicer 

covenants to the Manager as follows: 

(a) The Servicer shall be responsible for submitting all Internal Revenue 

Service information returns related to each Loan for all applicable periods commencing with the 

Servicing Transfer Date with respect thereto (or, iflater, the Effective Date). Information returns 

include reports on Forms 1098 and 1099 and any other reports required by Law. The Servicer 

shall be responsible for submitting all information returns required under Law of any foreign 

Governmental Authority, to the extent such are required to be filed by the Company under such 

Law, relating to the Loans, for the calendar or Tax year in which the Effective Date falls and 

thereafter. 

(b) The Servicer shall cause to be kept and maintained, at all times, at the 

Servicer' s principal place of business, a complete and accurate set of files, books and records 

(including records transferred by the Manager to the Servicer) regarding the Loans and the 

Underlying Collateral, and the Company's interests in the Loans and the Underlying Collateral, 

including records relating to the Collection Account, the Escrow Accounts and any Other 

Accounts maintained in connection with the Loans, Servicer Advances, Funding Draws and 

other Working Capital Expenses and collection and remittance of Loan Proceeds. The books of 

account shall be maintained in a manner that provides sufficient assurance that: (i) transactions 

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are executed in accordance with the general or specific authorization ofthe Manager consistent 

with the provisions ofthe LLC Operating Agreement; and (ii) transactions ofthe Company are 

recorded in such form and manner as will: (A) permit preparation offederal, state and local 

income and franchise Tax returns and information returns in accordance with the LLC Operating 

Agreement and as required by Law; (B) permit preparation ofthe Company's financial 

statements in accordance with GAAP and the LLC Operating Agreement and the provisions of 

the reports required to be provided thereunder; and (C) maintain accountability for the 

Company's assets. 

(c) The Servicer shall cause all such books and records to be maintained and 

retained until the date that is the later often (1 0) years after the Closing Date and three (3) years 

after the date on which the final Loan Proceeds are distributed to the Company, which date shall 

be established by notice to the Servicer from the Manager. All such books and records shall be 

available during such period for inspection by the Manager, the FDIC, the Purchase Money 

Notes Guarantor, the Revolver Lender and the Initial Member (and their respective 

representatives, including any applicable Governmental Authority) at all reasonable times during 

business hours on any Business Days (or, in the case of any such inspection after the term hereof, 

at such other location as is provided by notice to the Manager, the FDIC, the Purchase Money 

Notes Guarantor, the Revolver Lender and the Initial Member, as applicable), in each instance 

upon not less than two (2) Business Days' prior notice to the Servicer. Upon request by the 

Manager, the Servicer, at the sole cost and expense ofthe Manager, shall promptly send copies 

(the number of copies ofwhich shall be reasonable) of such books and records to the Manager. 

The Servicer shall provide the Manager with reasonable advance notice ofthe Servicer' s 

intention to destroy or dispose of any documents or files relating to the Loans and, upon the 

request ofthe Manager, shall allow the Manager, at its own expense, to recover the same from 

the Servicer. The Servicer shall also maintain complete and accurate records reflecting the status 

oftaxes, ground rents and other recurring charges which could become a Lien on any Underlying 

Collateral. 

(d) The covenants set forth in Section 5.2(b) and{£} above to maintain a 

complete and accurate set ofrecords shall encompass all files in the Servicer's custody, 

possession or control pertaining to the Loans and the Underlying Collateral, including (except as 

required to be held by the Custodian pursuant to the Custodial and Paying Agency Agreement) 

all original and other documentation pertaining to the Loans and the Underlying Collateral, all 

documentation relating to items ofincome and expense pertaining to the Loans and the 

Underlying Collateral, and all ofthe Servicer's (and any Subservicer's) internal memoranda 

pertaining to the Loans and the Underlying Collateral. 

(e) The Servicer shall cause to be furnished to the Manager, each month on 

the Specified Date, commencing with June 2010 (or such other date as may be set forth in the 

Servicing Obligations), a monthly electronic report on the Loans and Underlying Collateral 

containing such information and substantially in the form set forth on Schedule 4 attached hereto 

as the same may be amended from time to time by the Manager (without the consent ofthe 

Initial Member) and the Servicer (the "Electronic Report"). The Electronic Report shall 

include, but not be limited to, the information required for the Manager to prepare, in accordance 

with the LLC Operating Agreement, the "Distribution Date Report" and the "Monthly Report" 

(each as defined in the LLC Operating Agreement), and such other reports and information as the 

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Manager shall reasonably require, to the extent such information is reasonably available to the 

Servicer. Notwithstanding the above, with respect to any period prior to the applicable Servicing 

Transfer Date, the applicable Electronic Reports may exclude certain of the information 

otherwise required to be included therein if and to the extent the Initial Member is obligated to 

provide such information (or other information that is a prerequisite to the Servicer being able to 

provide such information) to the Servicer and the Manager pursuant to the interim servicing and 

asset management support obligation set forth in Section 3.3 ofthe Contribution Agreement and 

the Initial Member fails to timely deliver such information to the Servicer and the Manager. 

(f) The Servicer shall deliver, and shall cause each Subservicer to deliver, to 

the Manager, on or before March 1Oth of each year, or such other day as the Manager and the 

Servicer may agree, commencing in the year 2011, an annual officer's certificate stating, as to 

the signer thereof, that (i) a review of such party's activities during the preceding calendar year 

(or other applicable period as set forth below in this Section 5 .2(f)) and of its performance under 

this Agreement (or, as applicable, any Subservicing Agreement) has been made under such 

officer's supervision, and (ii) to the best of such officer's knowledge and belief, based on such 

review, such party has fulfilled all ofits obligations under this Agreement (or, as applicable, any 

Subservicing Agreement) in all material respects throughout such year or portion thereof or, if 

there has been a failure to fulfill any such obligation in any material respect, specifying each 

such failure and the nature and status thereof. The first such officer's certificate shall, with 

respect to any Loan, shall cover the period commencing on the Servicing Transfer Date (and 

with respect to each Loan, shall include relevant information with respect thereto for the period 

commencing on the Servicing Transfer Date for such Loan) and continuing through the end of 

the 2010 calendar year. In the event any Subservicer was terminated, resigned or otherwise 

performed in such capacity for only part of a year (or other applicable period, as the case may be, 

with respect to the period commencing, with respect to any Loan, on the Servicing Transfer Date 

through the end ofthe 2010 calendar year), such party shall provide an officer's certificate 

pursuant to this Section 5.2 with respect to such portion ofthe year (or other applicable period). 

(g) On or before March lOth of each year, or such other day as the Manager 

and the Servicer agree, commencing in the year 2011, the Servicer shall, or shall cause each 

applicable Subservicer to, provide to the Manager (and/or to such other Person as the Manager 

may direct) the annual reports (including the independent accountant report) for the prior year (or 

other applicable period as set forth below) required under Section 1122 of Regulation AB 

(regardless ofwhether any such requirements apply, by their terms, only to companies registered 

or required to file reports with the Securities and Exchange Coi:nmission) with respect to the 

relevant servicing criteria provisions of Section 1122( d)(l) ofRegulation AB that are applicable 

to the servicing being conducted under this Agreement pursuant to Section 4.5. The first such 

reports shall cover the period commencing on the Effective Date (and for each Loan, covering 

the period from the applicable Servicing Transfer Date) and continuing through the end ofthe 

2010 calendar year. 

(h) In connection with the Manager's obligations under the LLC Operating 

Agreement to prepare, review and periodically update Business Plans and Consolidated Business 

Plans, the Servicer shall prepare and deliver to the Manager, and thereafter periodically update, 

such Business Plans and Consolidated Business Plans, or relevant portions thereof or information 

to be included therein, in each case to the extent set forth and required pursuant to Schedule 6 

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attached hereto hereto as the same may be amended from time to time by the Manager and the 

Servicer without the consent ofthe Initial Member (the "Business Plan Schedule"). Upon 

reasonable notice by the Initial Member, the Revolver Lender, the Purchase Money Notes 

Guarantor or the Manager, the Servicer shall make its personnel who are familiar with the 

Business Plans and Consolidated Business Plans (or relevant portions thereof) available during 

normal business hours for the purposes of discussing such Business Plans and Consolidated 

Business Plans with representatives ofthe Initial Member, the Revolver Lender, the Purchase 

Money Notes Guarantor and/or the Manager and responding to questions therefrom. 

Section 5.3 Audits. Until the later ofthe date that is ten (10) years after the Closing 

Date and the date that is three (3) years after the date on which the final Loan Proceeds are 

distributed to the Company, which date shall be established by notice to the Servicer from the 

Manager, the Servicer shall, and shall cause each Subservicer to, (i) provide the Manager, the 

Revolver Lender, the Purchase Money Notes Guarantor and the Initial Member and their 

respective representatives (including any Governmental Authority), during normal business 

hours and on reasonable notice, with access to and the right to review all ofthe books of account, 

reports and records relating to the Loans or any Underlying Collateral, the Servicing Obligations, 

the Collection Account, the Escrow Accounts, any Other Accounts or any matters relating to this 

Agreement or the rights or obligations hereunder, (ii) permit such representatives to make copies 

of and extracts from the same, (iii) allow the Manager, the Revolver Lender, the Purchase Money 

Notes Guarantor and the Initial Member to cause such books to be audited by accountants 

selected by the Manager, the Revolver Lender, the Purchase Money Notes Guarantor or the 

Initial Member, as applicable, and (iv) allow the Manager's, the Revolver Lender's, the Purchase 

Money Notes Guarantor's and the Initial Member's representatives, and any of their respective 

Affiliates, to discuss the Servicer' s and any Subservicer' s affairs, finances and accounts, as they 

relate to the Loans, the Underlying Collateral, the Servicing Obligations, the Collection Account, 

the Escrow Accounts, and any Other Accounts or any other matters relating to this Agreement or 

the rights or obligations hereunder or thereunder, with the Manager's, the Revolver Lender's, the 

Purchase Money Notes Guarantor's and the Initial Member's officers, directors, employees and 

accountants (and by this provision the Servicer hereby authorizes the Manager's, the Revolver 

Lender's, the Purchase Money Notes Guarantor's and the Initial Member's accountants to 

discuss such affairs, finances and accounts with such representatives). Any expense incurred by 

the Manager, the Revolver Lender, the Purchase Money Notes Guarantor or the Initial Member 

and any reasonable out-of-pocket expense incurred by the Servicer in connection with the 

exercise by the Manager, the Revolver Lender, the Purchase Money Notes Guarantor or the 

Initial Member of its rights in this Section 5.3 shall be borne by the Manager, the Revolver 

Lender, the Purchase Money Notes Guarantor or the Initial Member, as applicable (and in all 

events subject to any obligation ofthe Manager to bear such expenses of the Revolver Lender, 

the Purchase Money Notes Guarantor or the Initial Member pursuant to the LLC Operating 

Agreement); provided, however, that any expense incident to the exercise by the Manager, the 

Revolver Lender, the Purchase Money Notes Guarantor or the Initial Member oftheir respective 

rights pursuant to this Section 5.3 as a result of or during the continuance of a Default by the 

Servicer hereunder shall in all cases be borne by the Servicer. 

Section 5.4 No Liens. The Servicer (i) shall not place or voluntarily permit any Lien 

to be placed on any ofthe Loans, the Underlying Collateral, the Loan Documents or the Loan 

Proceeds, except, in the case ofthe Underlying Collateral, (x) as permitted under the Loan 

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Documents where the applicable Borrower is not in default thereunder and (y) as permitted by 

the terms ofthe Revolver or the Reimbursement, Security and Guaranty Agreement, and (ii) 

shall not take any action to interfere with the Collateral Agent's rights as a secured party with 

respect to the Loans, the Underlying Collateral and the Loan Proceeds. 

Section 5.5 Servicer's Duty to Advise; Delivery of Certain Notices. In addition to 

such other reports and access to records and reports as are required to be provided to the 

Manager, the Purchase Money Notes Guarantor, the Revolver Lender and the Initial Member 

hereunder, the Servicer shall cause to be delivered to the Manager such information relating to 

the Loans, the Underlying Collateral, the Servicer and any Subservicer as the Manager may 

reasonably request from time to time and, in any case, shall ensure that the Manager is promptly 

advised, in writing, of any matter of which the Servicer or any such Subservicer becomes aware 

relating to the Loans, any ofthe Underlying Collateral, the Collection Account, the Escrow 

Accounts, any accounts created under the Revolver or the Custodial and Paying Agency 

Agreement, any Other Accounts or any Borrower or Obligor that materially and adversely affects 

the interests ofthe Company, the Purchase Money Notes Guarantor, the Revolver Lender or the 

Initial Member. Without limiting the generality ofthe foregoing, the Servicer shall immediately 

notify the Manager of (i) any claim, threatened claim or litigation against the Servicer, the 

Company, the Manager or the Initial Member arising out of or with respect to any Loan, (ii) any 

material notice from any Governmental Authority relating to any Underlying Collateral, (iii) any 

occurrence which could reasonably be expected to result in cost overruns with respect to any 

Loan or Acquired Property for which Funding Draws have been, or are contemplated to be, 

made, (iv) in the case of any Construction Loan, any construction delays which would 

reasonably be expected to cause milestones in the Approved Construction Schedule (as defined 

in the Revolver) not to be met, or (v) any other occurrence which would reasonably be expected 

to materially hamper, prevent or interfere with the effectuation of any then-applicable Business 

Plans or Consolidated Business Plan. In addition, the Servicer shall cause to be delivered to the 

Manager information indicating any possible Environmental Hazard with respect to any 

Underlying Collateral. Further, the Servicer shall cause to be furnished to the Manager, each 

month on the Specified Date, commencing the first (1st) month following the Effective Date and 

together with the Electronic Report, a report with respect to each Loan and Underlying Collateral 

(A) containing a summary ofthe progress made, to the extent applicable, in the construction, 

marketing and leasing ofthe applicable project since the last such report, (B) in the case of any 

Loan, describing the remedial efforts or enforcement actions, if any, being undertaken by the 

Servicer with respect to the applicable Loan, (C) describing the status ofthe activities 

contemplated by the Business Plans or Consolidated Business Plan (which, among other things, 

identifies any facts or circumstances which are reasonably likely to hamper, interfere with, 

prevent or postpone effectuation ofthe applicable Business Plans or Consolidated Business 

Plan), (D) to the extent applicable, containing an itemized statement of costs and expenses 

remaining to be paid in order to complete construction ofthe applicable project (including 

capitalized interest, real estate taxes and other soft costs), (E) to the extent requested by the 

Manager, any materials delivered by any Borrower to the Company or the Servicer pursuant to 

the applicable Loan Documents not theretofore delivered to the Manager (including, without 

limitation, copies of all plans and specifications, construction budgets and construction 

schedules, construction contracts, architect's agreements, leasing and brokerage agreements, 

management agreements (and Modifications to each ofthe foregoing) and materials delivered by 

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the applicable Borrower in connection with each request for an advance under the related Loan 

and (F) such other information as the Manager reasonably requests. 

Section 5.6 Notice ofBreach or Change of Control. The Servicer shall immediately 

notify the Manager of (i) any failure or anticipated failure on its part to observe and perform any 

warranty, representation, covenant or agreement required to be observed and performed by it as 

the Servicer, and (ii) any Change ofControl with respect to the Servicer. 

Section 5.7 Copies ofDocuments. Copies ofthe Revolver, the LLC Operating 

Agreement and the other Ancillary Documents (or portions thereof) as the Manager has 

determined to be necessary for the Servicer to be familiar with in order to perform its obligations 

hereunder have been delivered to the Servicer by the Manager, and the Servicer acknowledges 

receipt thereof. Further, the Manager shall provide the Servicer with copies of all Approved 

Business Plans, as and when approved by he Manager and the Revolver Lender in accordance 

with the Revolver, as shall be necessary in order for the continued performance by the Servicer 

ofits obligations hereunder. The Manager may from time to time deliver to the Servicer such 

Modifications or additional Ancillary Documents (or portions of any thereof) as the Manager 

may determine to be so necessary for the continued performance by the Servicer of its 

obligations hereunder. The Servicer acknowledges that it will review, as and when received 

from the Manager, such copies ofthe Approved Business Plans, and agrees that the Servicer 

shall not make any advance under any Loan on behalf ofthe Company unless (i) such advance is 

consistent with the applicable Approved Business Plan, (ii) the Company is entitled to a 

corresponding Advance Loan under the Revolver, and (iii) it has received the funds required and 

the consent ofthe Manager to make the advance. All references herein to the Servicer' s 

obligations with respect to the LLC Operating Agreement, the Revolver and the other Ancillary 

Documents shall, as between the Manager and the Servicer (and without limitation of obligations 

ofthe Manager, or the rights ofthe Initial Member, the Purchase Money Notes Guarantor or the 

Revolver Lender, under this Agreement, the LLC Operating Agreement, the Revolver or the 

other Ancillary Documents), be deemed to refer to the LLC Operating Agreement, the Revolver 

and the other Ancillary Documents (or portions thereof) as have been, or from time to time are, 

delivered to the Servicer. 

Section 5.8 Financial Information. The Servicer will submit to the Company, with 

copies thereof to be delivered by the Servicer to the Purchase Money Notes Guarantor, the 

Revolver Lender and the Initial Member, (i) within forty-five ( 45) days after the end of each of 

its fiscal quarters, commencing on the Effective Date, and (ii) Within ninety (90) days after the 

end of each ofits fiscal years, commencing on the Effective Date, a letter certified by an officer 

ofthe Servicer that details certain agreed upon financial trends and ratios relating to the Servicer 

(and/or such other financial information as the Manager, the Purchase Money Notes Guarantor, 

the Revolver Lender or the Initial Member may reasonably request from time to time). 

ARTICLE VI 


MANAGER CONSENT 


Section 6.1 Actions Requiring Manager Consent. Notwithstanding anything to the 

contrary contained in this Agreement, the Servicer shall not cause or permit to be taken any of 

the following actions without the prior written consent ofthe Manager (which, other than with 

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respect to clause (g) below, may require the Manager to obtain the consent ofthe Initial Member 

and/or the Purchase Money Notes Guarantor, which consent may be withheld or conditioned in 

the sole and absolute discretion ofthe Manager: 

(a) conducting Bulk Sales except as expressly permitted in the Servicing 

Obligations (and in all events subject to the limitations set forth in the LLC Operating 

Agreement); 

(b) the payment offees to, the sale or other transfer (including through 

foreclosure or by deed in lieu thereof) of any Loan or Underlying Collateral or Acquired 

Property (or any portion thereof) to, or any other transaction with (whether or not at usual and 

customary rates), any Affiliate ofthe Company, the Manager, the Servicer, any Affiliate ofthe 

Servicer, any Subservicer, or any Affiliate of any Subservicer; 

(c) the financing ofthe sale or other transfer of any Loans, Underlying 

Collateral or Acquired Property (or any portion thereof); 

(d) the sale of any Loan or Underlying Collateral or Acquired Property (or 

any portion thereof) that provides for any recourse against the Company, the Initial Member or 

the FDIC in any capacity, or against any interest in the Company held by the Initial Member or 

any share ofthe Loan Proceeds allocable to the Initial Member; 

(e) any disbursement of any funds in the Collection Account (including any 

such funds made available through Discretionary Funding Advances or Excess Working Capital 

Advances), the accounts created under the Revolver or the Custodial and Paying Agency 

Agreement or any Other Accounts, or funds disbursed from the Revolver other than in 

accordance with the provisions ofthis Agreement, the LLC Operating Agreement, the Revolver, 

the Reimbursement, Security and Guaranty Agreement and the Custodial and Paying Agency 

Agreement; 

(f) advancing additional funds that would increase the Unpaid Principal 

Balance of any Loan other than (i) with funds provided by the Advance Loans under the 

Revolver or Excess Working Capital Advances, in each case used for purposes for which the 

proceeds ofAdvance Loans may be used under the Revolver, (ii) Funding Draws, or (iii) 

Servicing Expenses to the extent that capitalizing such Servicing Expenses is or would have 

been, prior to the conversion ofthe Loan to Acquired Property,, permitted under the applicable 

Loan Documents; 

(g) in connection with its servicing and administration of any Loan and 

management ofthe Underlying Collateral or Acquired Property, (i) approving (x) any material 

Modification to, or cancellation or termination of, any Loan Documents, or (y) plans and 

specifications, construction budgets or construction schedules with respect to the projects which 

are the subject ofsuch Loan (or material modifications to any of such items, including any 

change orders); (ii) waiving or forbearing from exercising any ofthe lender's rights under, or any 

conditions precedent to the funding of any advances under, such Loan; (iii) forgiving or reducing 

or forbearing from collecting any indebtedness; (iv) releasing any parties liable for the payment 

ofthe Loan or the performance of any other obligation relating thereto; (v) granting any consent 

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under any Loan Documents (including with respect to any proposed transfers of any Underlying 

Collateral or transfers, pledges or changes in management of any direct or indirect interests in 

any Borrower, proposed alterations, proposed settlements of insurance claims, condemnation 

claims or deficiencies or proposed applications of insurance proceeds or condemnation awards); 

(vi) consenting to any agreement in any Insolvency Proceeding relating to any Loan, any 

Borrower or any Obligor with respect to a Loan, or any Underlying Collateral, including voting 

for a plan ofreorganization; (vii) subordinating the Liens ofthe Loan Documents; (viii) 

amending or waiving any provision of any intercreditor agreement or making any decisions with 

respect to the Loans under any intercreditor agreement; or (ix) taking any other action regarding 

such Loan, Underlying Collateral or Acquired Property that requires the consent ofthe Revolver 

Lender; unless, in each case, such item or action is provided for under the then applicable 

Approved Business Plan and is not prohibited under the LLC Operating Agreement, the 

Revolver or the other Ancillary Documents or otherwise inconsistent with the Servicing 

Standard; 

(h) reimbursement for any expense or cost incurred or paid by any Affiliate of 

the Company, any Affiliate ofthe Servicer or any Affiliate of any Subservicer; or 

(i) selling or otherwise causing the Disposition (as such term is defined in the 

LLC Operating Agreement) of any Participated Loans to a Borrower or a Related Party. 

Section 6.2 Amendments, Modification and Waivers. No provision ofthis Agreement 

may be amended, modified or waived except in writing executed by the Manager and the 

Servicer, and each such Modification shall be subject to the prior written consent ofthe Initial 

Member, except for those provisions that may be amended by the express terms hereof without 

the Initial Member's consent. In no event shall any such amendment or waiver limit or affect the 

rights ofthe FDIC (as a third party beneficiary hereunder as specified in Section 11.8) without 

the express written consent ofthe FDIC. 

ARTICLE VII 

DEFAULTS; TERMINATION; TERMINATION WITHOUT CAUSE 

Section 7.1 Defaults. A default ("Default") means the occurence of: 

(a) any failure by the Servicer to remit to the Company or deposit in the 

Collection Account, the Escrow Accounts, any accounts created under the Revolver or the 

Custodial and Paying Agency Agreement or any Other Accounts any amount required to be so 

remitted or deposited under the terms of (i) this Agreement, (ii) the Revolver, (iii) the LLC 

Operating Agreement, or (iv) the Custodial and Paying Agency Agreement; 

(b) any Insolvency Event (without any cure period other than as may be 

provided for in the definition of Insolvency Event) (i) with respect to the Servicer or any ofits 

Related Parties, or (ii) with respect to any Subservicer or any of its Related Parties; provided, 

that any such Insolvency Event under this clause (ii) (that is not otherwise an Insolvency Event 

under clause (i) hereof) shall not be a Default hereunder (but shall in all events be a default under 

the applicable Subservicing Agreement) so long as the Servicer shall have fully replaced such 

affected Subservicer within thirty (30) days after the occurrence ofsuch Insolvency Event; or 

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(c) any failure by the Servicer to duly perform its obligations in (i) Section 

5.2(e), which failure continues unremedied for a period offive (5) days, or such other period as 

the Manager and the Servicer agree, after the date on which written notice ofsuch failure 

requiring the same to be remedied shall have been given by the Manager to the Servicer, or (ii) 

Section 5.2(:0 or Section 5.2(g), which failure continues unremedied for a period oftwenty-five 

(25) days, or such other period as the Manager and the Servicer agree, after the date on which 

written notice ofsuch failure requiring the same to be remedied shall have been given by the 

Manager to the Servicer; or 

(d) any failure by the Servicer at any time (i) to renew or maintain any permit 

or license necessary to carry out its responsibilities under this Agreement in compliance with 

Law, or (ii) to cause each Subservicer to meet the applicable characteristics of a Qualified 

Servicer as required under Section 4.1 and to renew or maintain any permit or license necessary 

to carry out its responsibilities under any Subservicing Agreement, which, in the case of clause 

ill or .(ill, continues unremedied for a period ofthirty (30) days after the date on which written 

notice of such failure requiring the same to be remedied shall have been given by the Manager or 

the Initial Member to the Servicer; or 

(e) any failure by the Servicer to cause any Subservicer to comply with the 

terms ofits Subservicing Agreement with the Servicer, the occurrence of a default or material 

breach by any Subservicer under its Subservicing Agreement, or the failure by the Servicer to 

replace any Subservicer upon the occurrence of any such event in accordance with the terms 

governing material breach or default under the applicable Subservicing Agreement; or 

(f) any other failure (other than those specified in any of Section 7.1(a) 

through@) by the Servicer to duly observe or perform any other covenants or agreements on the 

part ofthe Servicer contained in this Agreement or to perform any Servicing Obligation in 

compliance with the Servicing Standard, and such failure continues unremedied for a period of 

thirty (30) days, or such other period as the Manager, with the consent ofthe Initial Member, and 

the Servicer agree, after the date on which written notice of such failure shall have been given by 

the Manager or the Initial Member to the Servicer; provided, however, that in the case of a 

failure that cannot be cured within thirty (30) days (or such other period as the Manager, with the 

consent ofthe Initial Member, and the Servicer agree) with the exercise of reasonable diligence, 

the cure period shall be extended for an additional thirty (30) days ifthe Servicer can 

demonstrate to the reasonable satisfaction ofthe Manager and the Initial Member that the 

Servicer is diligently pursuing remedial action; and provided, further, that, with respect to any 

such failure under this Section 7.1 (f) that relates exclusively to obligations included in any 

applicable Schedule hereto that can be amended or otherwise modified without the consent ofthe 

Initial Member, then no such consent ofthe Initial Member shall be required with respect to an 

applicable cure period hereunder so long as the such failure hereunder is not, or would not result 

in, a failure by the Manager to comply with its obligations under the LLC Operating Agreement, 

the Revolver and the other Ancillary Documents; or 

(g) the occurrence of any Restricted Servicer Change of Control. 

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Section 7.2 Termination with Cause. 

(a) Upon the occurrence of (w) a Default pursuant to this Agreement, in each 

case, without any cure period other than as may be provided for in Section 7.1, (x) the 

occurrence of any "Event ofDefault," as defined in the LLC Operating Agreement, (y) the 

receipt by the Manager or the Servicer ofnotice from the Revolver Lender or the Purchase 

Money Notes Guarantor that an "Event of Default" as defined in the Reimbursement, Security 

and Guaranty Agreement or the Revolver has occurred and is continuing, or (z) any failure by 

the Servicer at any time to have an Acceptable Rating or otherwise comply with its obligation to 

be a Qualified Servicer, the Manager (including, if applicable, any successor "Manager" 

pursuant to the LLC Operating Agreement), the Initial Member, or the Purchase Money Notes 

Guarantor, in addition to any other rights the Manager, the Initial Member or the Purchase 

Money Notes Guarantor, may have at law (including under the Uniform Commercial Code) or 

equity, including injunctive relief, specific performance or otherwise, may (i) terminate this 

Agreement by providing a Termination Notice to the Servicer, (ii) terminate the Subservicing 

Agreements by providing a written termination notice to the Servicer and the applicable 

Subservicers, and (iii) otherwise enforce this Agreement, in any case, without penalty or 

payment of any fee. 

(b) In addition to the rights set forth above in Section 7.2(a), (i) upon the 

removal ofthe Manager as the "Manager" pursuant to the LLC Operating Agreement and/or 

notice from the Initial Member or the Manager of the occurrence of any Event ofDefault (as 

defined in the LLC Operating Agreement) under the LLC Operating Agreement, the Initial 

Member (or any successor "Manager" to the Manager under the LLC Operating Agreement) may 

exercise all ofthe rights ofthe Manager under this Agreement and further cause the termination 

or assignment ofthis Agreement from the Manager to any other Person, without penalty or 

payment of any fee, and (ii) upon the occurrence of any Default under this Agreement, each of 

the Manager (or applicable successor "Manager" to the Manager under the LLC Operating 

Agreement) and the Initial Member may exercise all ofthe rights of (A) the Manager under this 

Agreement and cause the termination or assignment ofthis Agreement to any other Person, 

without penalty or payment of any fee, and (B) the Servicer under the Subservicing Agreement 

and cause the termination or assignment ofthe Subservicing Agreement to any other Person, 

without penalty or payment of any fee. 

(c) The Servicer hereby consents to its immediate and automatic termination 

under this Agreement upon a Default under Section 7.1 (b). 

(d) Upon a default or failure ofthe Manager to perform its obligations under 

this Agreement in a material manner, including the failure ofthe Manager to pay to the Servicer 

the Servicing Fee in a full and timely manner, the Servicer, in addition to any other rights it may 

have pursuant to this Agreement, at law or in equity, may terminate this Agreement by providing 

a Termination Notice to the Manager, with a copy to the Purchase Money Notes Guarantor, the 

Revolver Lender and the Initial Member. The Termination Notice shall set forth with specificity 

the nature ofthe default or failure to perform ofthe Manager and provide the Manager with no 

less than thirty (30) days to cure any such default or failure to perform. In the event that such 

default or failure to perform is not cured within thirty (30) days after the date of delivery ofthe 

Termination Notice, the Servicer shall provide a second Termination Notice to the Manager with 

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a copy to the Purchase Money Notes Guarantor, the Revolver Lender and the Initial Member, 

which second Termination Notice shall be prominently labeled as the "Second Termination 

Notice". Such Second Termination Notice shall confirm to the Manager that the Servicer shall 

continue to perform the Servicing Obligations under this Agreement until the earlier to occur of 

(i) ninety (90) days after the delivery ofthe Second Termination Notice to the Manager, the 

Purchase Money Notes Guarantor, the Revolver Lender and the Initial Member, and (ii) the 

transfer ofthe Servicing Obligations to a successor Servicer. The duty ofthe Servicer to 

continue to perform the Servicing Obligations as provided in the Second Termination Notice is 

contingent upon the timely and full payment ofthe Servicing Fee to the Servicer during such 

period. The Servicer shall cooperate fully and completely with the transition ofthe Servicing 

Obligations to a successor Servicer in order to assure an orderly transfer. 

Section 7.3 Termination without Cause. 

(a) The Manager may, without cause, terminate this Agreement, upon 

providing a Termination Notice to the Servicer, but only as and in accordance with the 

provisions set forth on Schedule 5 attached hereto as the same may be amended from time to 

time by the Manager (without the Initial Member's consent) and the Servicer. 

(b) The Servicer may, at any time after the first (1st) anniversary ofthe 

Effective Date, without cause, terminate this Agreement. No termination ofthis Agreement by 

the Servicer shall be effective unless the Servicer delivers to the Manager, with a copy to the 

Purchase Money Notes Guarantor, the Revolver Lender and the Initial Member, a Termination 

Notice, which for the purpose ofthis Section 7.3(b) shall be a notice ofthe Servicer's intent to 

terminate this Agreement. Such Termination Notice shall be provided at least sixty (60) days 

prior to any date specified by the Servicer as the date oftermination ofthe Servicer's Obligations 

under this Agreement. Notwithstanding the foregoing, such Termination Notice shall not be 

effective unless the Termination Notice contains confirmation ofthe intent and obligation ofthe 

Servicer to continue to perform its Servicing Obligations until the earlier of (i) ninety (90) days 

after the Termination Notice is given and (ii) such other date on which the Servicing Obligations 

are transferred to a successor Servicer in an orderly manner. Servicer shall cooperate fully and 

completely with the transition ofthe Servicing Obligations to a successor Servicer, to be 

designated by the Manager, in order to assure an orderly transfer. The Servicer issuing the 

Termination Notice shall be liable for all costs associated with the transfer of Servicing 

Obligations to the successor Servicer, including but not limited to the costs of transporting the 

servicing files and the provision of any notices to any Borrowets. 

Section 7.4 Effective Termination Date. Termination as specified in this Article VIII 

shall be effective at such time as is specified in the Termination Notice. In the event ofsuch 

termination, all authority and power ofthe Servicer under this Agreement, whether with respect 

to the Loans or otherwise, shall pass to and be vested in the Manager or the successor servicer 

designated by the Manager in the case oftermination by the Manager or termination by the 

Servicer or as designated solely by the Initial Member (or any successor "Manager" under the 

LLC Operating Agreement) in the case oftermination by the Initial Member (or such successor 

"Manager" under the LLC Operating Agreement). The Servicer agrees to cooperate with the 

Manager, the Initial Member, any successor "Manager" under the LLC Operating Agreement 

and any successor servicer with respect to the timely and orderly transition of its obligations 

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l.lllder this Agreement. The Servicer shall be liable for all obligations ofthe Servicer that have 

accrued l.lllder this Agreement or at law prior to such termination. 

Section 7.5 Accollllting. Upon termination ofthis Agreement as set forth herein, the 

Servicer shall accollllt for and turn over to the Manager or its designee (or, if applicable, pursuant 

to such instructions as may be provided by the Initial Member or any successor "Manager" 

pursuant to the LLC Operating Agreement) funds collected l.lllder the terms ofthis Agreement. 

The Servicer shall provide written notice in conformance with all Laws to all Borrowers to 

indicate that their Loans will henceforth be serviced by the Manager (or applicable successor 

"Manager" l.lllder the LLC Operating Agreement) or any applicable successor Servicer 

designated by the Manager (or any successor "Manager" l.lllder the LLC Operating Agreement) 

or the Initial Member as the case may be, and transfer its duties as the Servicer to the Manager 

(or successor "Manager" l.lllder the LLC Operating Agreement) or such successor Servicer. 

ARTICLE VIII 

INDEPENDENCE OF PARTIES; INDEMNIFICATION 

Section 8.1 Independence ofParties. The Servicer shall have the status of, and act as, 

an independent contractor. Nothing herein contained shall be construed to create a partnership or 

joint venture or any similar relationship between the Manager and the Servicer. 

Section 8.2 Indemnification. The Servicer agrees to indemnify, defend and hold 

harmless the Company, the Manager, the Purchase Money Notes Guarantor, the Revolver 

Lender, the Initial Member and each oftheir respective Affiliates, directors, officers, employees 

and agents and each oftheir respective successors and assigns (the "Indemnified Parties") from 

and against any and all claims, demands, suits, actions, proceedings, assessments, losses, costs, 

expenses (including attorneys' fees), damages and liabilities of any kind or nature whatsoever 

directly or indirectly resulting from or arising out of or related to (i) any inaccuracy in any ofthe 

Servicer' s warranties or representations contained in this Agreement, (ii) any failure by the 

Servicer to observe or perform any or all ofthe Servicer' s covenants, agreements or warranties 

contained in this Agreement, (iii) any act taken by the Servicer purportedly pursuant to a power 

of attorney granted by the Manager which act results in a claim related to the unlawful use of 

such power of attorney, or (iv) any failure by the Servicer or any Subservicer to discharge 

obligations on any Underlying Collateral relating to Taxes, grolllld rents or other such recurring 

charges generally accepted by the mortgage servicing industry, which would become a Lien on 

the Underlying Collateral. The Servicer shall immediately notify the Indemnified Party if a 

claim related to the preceding sentence ofthis Section 8.2 is made with respect to this Agreement 

or any Loans or Underlying Collateral, assume (with prior consent ofthe Indemnified Party) the 

defense of any such claim and pay all expenses in connection therewith, including attorneys' 

fees, and promptly pay, discharge and satisfy any judgment or decree which may be entered 

against it or any Indemnified Party in respect ofsuch claim. No expenses incurred by the 

Servicer or any Subservicer in connection with its obligations l.lllder this Section 8.2 shall 

constitute Servicing Expenses or otherwise be deducted from or reimbursed out ofLoan 

Proceeds. The Servicer shall follow any reasonable written instructions received from the 

Indemnified Party in connection with such claims, it being l.lllderstood that the Indemnified Party 

shall have no duty to monitor or give instructions with respect to such claims. 

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Section 8.3 Procedure for Indemnification. Promptly upon receipt ofwritten notice of 

any claim in respect ofwhich indemnity may be sought pursuant to the terms ofthis Agreement, 

the Indemnified Party will use its best efforts to notify the Servicer in writing thereof in 

sufficient time for the Servicer to respond to such claim. Except to the extent that the Servicer is 

prejudiced thereby, the failure ofthe Indemnified Party to promptly notify the Servicer of any 

such claim shall not relieve the Servicer from any liability which it may have to the Indemnified 

Party in connection therewith. If any claim shall be asserted or commenced agaiQ.st the 

Indemnified Party, the Servicer will be entitled to participate therein, and to the extent it may 

wish to assume the defense, conduct or settlement thereof, it shall be entitled to do so with 

counsel reasonably satisfactory to the Indemnified Party; provided, however, that in the event the 

Servicer fails, in the reasonable judgment ofthe Indemnified Party, vigorously to defend or 

pursue or attempt to settle such claim, the Indemnified Party shall have the right to assume the 

conduct, defense or settlement thereof, provided, however, that the Servicer shall obtain the prior 

written approval ofthe Indemnified Party before ceasing to defend against any claim or entering 

into any settlement, adjustment or compromise of such claim involving injunctive or similar 

equitable relief being imposed upon any Indemnified Party or any of its Affiliates. After notice 

from the Servicer to the Indemnified Party of its election to assume the defense, conduct or 

settlement thereof, the Servicer will not be liable to the Indemnified Party for any legal or other 

expenses consequently incurred by the Indemnified Party in connection with the defense, 

conduct or settlement thereof. 

Section 8.4 Pre-Effective Date Liabilities. Notwithstanding anything to the contrary 

herein, but without limitation ofthe release set forth in Section 11.13, it is understood and agreed 

that the Servicer shall not be liable to the Manager for any liabilities or obligations attributable to 

an act, omission or circumstances ofthe Initial Member, the FDIC, SFG, the Failed Bank or the 

Company that occurred or existed prior to the Effective Date or, with respect to any particular 

Loan, the Servicing Transfer Date applicable thereto (the "Pre-Existing Liabilities"). In the 

event there is asserted against the Company, the Manager, the Servicer or any Subservicer any 

claim or action with respect to any such Pre-Existing Liabilities, the Servicer or Subservicer, as 

applicable, shall notify the Manager and the Initial Member ofsuch claim or action in 

accordance with Article IX. Except as provided otherwise in Section 8.2 and 8.3 (in the event 

that such claim or action is subject to the indemnification obligations ofthe Servicer pursuant to 

Section 8.1), the Manager shall have the right to control and assume the defense ofthe Company, 

the Manager, the Servicer and any Subservicer with respect to such claim or action at the 

Manager's expense. The Servicer shall be reimbursed by the Manager in connection with the 

foregoing only to the extent of and in accordance with the term's set forth on Schedule 3 attached 

hereto, as the same may be amended from time to time by the Manager (without the consent of 

the Initial Member) and the Servicer. 

ARTICLE IX 


NOTICES 


All notices, requests, demands and other communications required or permitted to be 

given or delivered under or by reason ofthe provisions ofthis Agreement shall be in writing and 

shall be given by certified or registered mail, postage prepaid, by delivery by hand or by 

nationally recognized courier service, or by electronic mail (followed up by a hard copy 

delivered through an alternate manner permitted under this Article IX), in each case mailed or 

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delivered to the applicable address or electronic mail address specified in, or in the manner 

provided in, this Article IX. All such notices, requests, demands and other communications shall 

be deemed to be given or made upon the earlier to occur of(i) actual receipt (or refusal thereof) 

by the relevant party hereto and (ii) (A) ifdelivered by hand or by nationally recognized courier 

service, when signed for (or refused) by or on behalfofthe relevant party hereto, and (B) if 

delivered by electronic mail (which form ofdelivery is subject to the provisions ofthis 

paragraph), when delivered and capable ofbeing accessed from the recipient's office computer, 

provided, however, that any notice, request, demand or other communication that is received 

other than during regular business hours ofthe recipient shall be deemed to have been given at 

the opening of business on the next Business Day. In no event shall a voice mail message be 

effective as a notice, communication or confirmation hereunder. From time to time, any party 

may designate a new address for purposes ofnotice to it hereunder by notice to such effect to the 

other parties hereto in the manner set forth in this Article IX. 

If to the Manager: 

with a copy to: 

If to the Initial Member, the 

Revolver or the Purchase Money 

Notes Guarantor: 

with a copy to: 

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Square Mile Lodging Recovery LLC 

c/o Square Mile Capital Management L LC 

450 Park A venue 

New York, New York 10022 

Attention: Jose h D.J)' Ang_eJo.______, 

Email Address: 

Greenberg Traurig 

MetLife Building 

200 Park A venue 

New York, New York 10166 

Attention: Gary S . ..Kleirun<4U...___--.. 

Email Address: 

Manager, Capital Markets & Resolutions 

c/o Federal Deposit Insurance Corporation 

550 17th Street, NW (Room F-7014) 

Washington, D.C. 20429-0002 

Attention: Ralph Malami 

Email Address: RMalami@fdic.gov 

Senior Counsel 

FDIC Legal Division 

Litigation and Resolutions Branch, Receivership 

Section 

Special Issues Unit 

3501 Fairfax Drive (Room E-7056) 

Arlington, Virginia 22226 

Attention: David Gearin 

Email Address: DGearin@fdic. gov 

42 

Thomas Raburn 

Federal Deposit Insurance Corporation 

TRabum@fdic.gov 

Ifto the Servicer: 	 Midland Loan Services, Inc. 


10851 Mastin, 7th Floor 


Overland Park, Kansas 66210 


Attention: President 


Email Address: ~[~.;__-----------.] 

with a copy to: 	 Midland Loan Services, Inc. 


10851 Mastin, 7th Floor 


Overland Park, Kansas 6621 0 


Attention: GeneraLCounse 


Email Address: 


ARTICLE X 


GOVERNING LAW; JURISDICTION 


Section 10.1 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY 

AND CONSTRUED IN ACCORDANCE WITH FEDERAL LAW, BUT IF FEDERAL LAW 

DOES NOT PROVIDE A RULE OF DECISION, IT SHALL BE GOVERNED BY AND 

CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK 

EXCLUDING ANY CONFLICT OF LAWS RULE OR PRINCIPLE THAT MIGHT REFER 

THE GOVERNANCE OR THE CONSTRUCTION OF THIS AGREEMENT TO THE LAW 

OF ANOTHER nJRISDICTION. Nothing in this Agreement shall require any unlawful action 

or inaction by any party hereto. 

Section 10.2 Jurisdiction; Venue and Service. Each ofthe parties hereto, for itself and 

each of its Affiliates, hereby irrevocably and unconditionally: 

(a) (i) agrees that any suit, action or proceeding instituted against it by any 

other party with respect to this Agreement may be instituted, and that any suit, action or 

proceeding instituted by it against any other party with respect to this Agreement shall be 

instituted, only in the Supreme Court ofthe State ofNew York, County ofNew York, or the U.S. 

District Court for the Southern District ofNew York, as the party instituting such sui ~ action or 

proceeding may choose (and appellate courts from any of the foregoing), 

(ii) consents and submits, for itself and its property, to the jurisdiction ofsuch 

courts for the purpose of any such suit, action or proceeding instituted against it by any other 

party, and 

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(iii) agrees that a final judgment in any such suit, action or proceeding shall be 

conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other 

manner provided by Law; 

(b) agrees that service of all writs, process and summonses in any suit, action 

or proceeding pursuant to Section 10.2(a) may be effected by the mailing of copies thereof by 

registered or certified mail, postage prepaid, to it at its address for notices pursua!J.t to Article IX 

(with copies to such other Persons as specified therein); provided, however, that nothing 

contained in this Section 1 0.2(b) shall affect the ability of any party to be served process in any 

other manner permitted by Law; 

(c) (i) waives any objection that it may now or hereafter have to the laying of 

venue of any suit, action or proceeding arising out of or relating to this Agreement brought in 

any court specified in Section 1 0.2(a), (ii) waives any claim that any such suit, action or 

proceeding brought in any such court has been brought in an inconvenient forum, and (iii) agrees 

not to plead or claim either ofthe foregoing; and 

(d) agrees that nothing contained in this Section 10.2 shall be binding upon or 

construed to constitute consent to jurisdiction by the Failed Bank or the FDIC, in any capacity, or 

constitute a limitation on any removal rights the FDIC, in any capacity, may have. 

Notwithstanding the above, if at any time the Initial Member shall replace the Manager 

hereunder pursuant to the terms ofthe LLC Operating Agreement, the terms ofthis Section 10.2 

shall be restated as follows: 

"The Servicer, on behalf ofitself and its Affiliates, hereby irrevocably and 

unconditionally: 

(a) (i) consents to the jurisdiction ofthe United States District Court for 

the Southern District ofNew York and to the jurisdiction ofthe United States District Court for 

the District of Columbia for any suit, action or proceeding against it or any ofits Affiliates 

commenced by the FDIC, in any capacity, arising out of, relating to, or in connection with this 

Agreement, and waives any right to: 

(A) remove or transfer such suit, action or proceeding to any 

court or dispute-resolution forum other than the court in which,the FDIC, in any capacity, files 

the action, suit or proceeding without the consent ofthe FDIC; 

(B) assert that venue is improper in either the United States 

District Court for the Southern District ofNew York or the United States District Court for the 

District of Columbia; or 

(C) assert that the United States District Court for the Southern 

District ofNew York or the United States District Court for the District of Columbia is an 

inconvenient forum; 

(ii) consents to the jurisdiction ofthe Supreme Court ofthe State of 

New York, County ofNew York, for any suit, action or proceeding against it or any ofits 

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Affiliates commenced by the FDIC, in any capacity, arising out of, relating to, or in connection 

with this Agreement, and waives any right to: 

(A) remove or transfer such suit, action or proceeding to any 

other court or dispute-resolution forum without the consent ofthe FDIC; 

(B) assert that venue is improper in the Supreme Court ofthe 

State ofNew York, County ofNew York; or 

(C) assert that the Supreme Court ofthe State ofNew York, 

County ofNew York is an inconvenient forum; 

(iii) agrees to bring any suit, action or proceeding against the FDIC, in 

any capacity, arising out of, relating to, or in connection with this Agreement, the LLC Operating 

Agreement or any Ancillary Document in only either the United States District Court for the 

Southern District ofNew York or the United States District Court for the District of Columbia, 

and waives any right to remove or transfer such suit, action or proceeding to any other court or 

dispute-resolution forum without the consent ofthe FDIC, and agrees to consent thereafter to 

transfer ofthe suit, action or proceeding to either the United States District Court for the 

Southern District ofNew York or the United States District Court for the District of Columbia at 

the option ofthe FDIC; and 

(iv) agrees, ifthe United States District Court for the Southern District 

ofNew York and the United States District Court for the District of Columbia both lack 

jurisdiction to hear a suit, action or proceeding falling within Section 1 0.2(a)(iii), to bring that 

suit, action or proceeding in only the Supreme Court ofthe State ofNew York, County ofNew 

York, and waives any right to remove or transfer such suit, action or proceeding to any other 

court or dispute-resolution forum without the consent ofthe FDIC. 

(b) The Servicer, on behalf ofitself and its Affiliates, hereby irrevocably and 

unconditionally agrees that any final judgment entered against it in any suit, action or proceeding 

falling within Section 1 0.2(a) may be enforced in any court of competent jurisdiction. 

(c) Subject to the provisions of Section 10.2(d), the Servicer, on behalfof 

itself and its Affiliates, and the FDIC hereby irrevocably and unconditionally agrees that service 

of all writs, process and summonses in any suit, action or proceeding pursuant to Section 10.2Ca) 

or Section 1 0.2(b) may be effected by the mailing of copies thereof by registered or certified 

mail, postage prepaid, to it at its address for notices pursuant to Article IX (with copies to such 

other Persons as specified therein); provided, however, that nothing contained in this Section 

1 0.2(c) shall affect the right of any party to serve process in any other manner permitted by Law. 

(d) Nothing in this Section 10.2 shall constitute consent to jurisdiction in any 

court by the FDIC, other than as expressly provided in Section 10.2(a)(iii) and Section 

10.2(a)(iv), or in any way limit the FDIC's right to remove, transfer, seek to dismiss, or 

otherwise respond to any suit, action, or proceeding against it in any forum. 

Section 10.3 Waiver of Jury Trial. EACH OF THE PARTIES HERETO, FOR ITSELF 

AND EACH OF ITS AFFILIATES, HEREBY IRREVOCABLY AND UNCONDITIONALLY 

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WANES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY OF ANY DISPUTE 

ARISING OUT OF OR RELATING TO THIS AGREEMENT AND AGREES THAT ANY 

SUCH DISPUTE SHALL BE TRIED BEFORE A JUDGE SITTING WITHOUT A JURY. 

ARTICLE XI 

MISCELLANEOUS 

Section 11.1 Assignment by Servicer; Transfer of Ownership Interests in Servicing 

Rights. 

(a) The Servicer hereby acknowledges that this Agreement constitutes a 

personal services agreement between the Manager and the Servicer. Any ofthe following shall 

constitute an assignment for all purposes ofthis Agreement: (a) any merger, consolidation or 

dissolution involving the Servicer or (b) any direct or indirect transfer or all or substantially all of· 

the assets ofthe Servicer, notwithstanding whether any ofthe foregoing transactions occur at one 

time or in the aggregate over a period oftime. The Servicer shall not directly or indirectly assign 

any rights or obligations hereunder to any other Person other than as is expressly permitted in 

Section 7.3(b) or Section 7.4. 

(b) In connection with the sale of a Loan, the Servicer shall, at the direction of 

the Manager, transfer, sell or assign its rights hereunder to service such Loan; provided, 

however, under no circumstances shall such servicing rights be assigned, sold, sub-participated, 

pledged, delegated or otherwise transferred to the Borrower or any Affiliate thereof in 

connection with the sale of a Loan Participation except in accordance with the LLC Agreement. 

(c) Except as provided in Section 11.1 (b) above, under no circumstances shall 

the Servicer (i) directly or indirectly transfer to any Subservicer or any other Person any 

ownership interest in the servicing ofthe Loans or any right to transfer or sell the servicing rights 

to the Loans, or (ii) assign, pledge or otherwise directly or indirectly transfer or purport to assign, 

pledge or otherwise transfer any interest to any Subservicer or other Person in the servicing of 

the Loans. 

(d) Any purported assignment, sale, sub-participation, pledge, delegation or 

other direct or indirect transfer in violation ofthis Section 11.1 (b) shall be void ab initio and of 

no force or effect whatsoever. 

Section 11.2 Legal Fees. No party to this Agreement shall be responsible for the 

payment ofthe legal fees or expenses incurred by the other party hereto in connection with the 

negotiation and execution ofthis Agreement or any subsequent Modifications or supplements 

hereto. 

Section 11.3 Entire Agreement. This Agreement contains the entire agreement between 

the Manager and the Servicer and supersedes any and all other prior agreements, whether oral or 

written, with respect to the subject matter hereof. 

Section 11.4 Counterparts; Facsimile Signatures. This Agreement may be executed in 

two (2) or more counterparts, each of which shall be deemed an original but all ofwhich together 

shall constitute but one and the same agreement. This Agreement and any amendments hereto, 

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to the extent signed and delivered by facsimile or other electronic means, shall be treated in all 

manner and respects as an original agreement and shall be considered to have the same binding 

legal effect as if it were the original signed version thereof delivered in person. No signatory to 

this Agreement shall raise the use of a facsimile machine or other electronic means to deliver a 

signature or the fact that any signature or agreement was transmitted or communicated through 

the use of a facsimile machine or other electronic means as a defense to the formation or 

enforceability of a contract and each such Person forever waives any such defense. 

Section 11.5 Headings. Paragraph titles or captions contained in this Agreement are 

inserted only as a matter of convenience and for reference and in no way define, limit, extend or 

describe the scope ofthis Agreement or the intent of any provisions hereof. All Section and 

paragraph references contained herein shall refer to Sections and paragraphs in this Agreement 

unless otherwise specified. 

Section 11.6 Compliance with Law. Except as otherwise specifically provided herein, 

each party to this Agreement shall, at its own cost and expense, obey and comply with all Laws, 

as they may pertain to such party's performance of its obligations hereunder. 

Section 11.7 Severability. Any provision ofthis Agreement which is prohibited or 

unenforceable in any jurisdiction shall be ineffective, but such ineffectiveness shall be limited as 

follows: (i) ifsuch provision is prohibited or unenforceable in such jurisdiction only as to a 

particular Person or Persons and/or under any particular circumstance or circumstances, such 

provision shall be ineffective, but only in such jurisdiction and only with respect to such 

particular Person or Persons and/or under such particular circumstance or circumstances, as the 

case may be; (ii) without limitation of clause (i), such provision shall in any event be ineffective 

only as to such jurisdiction and only to the extent ofsuch prohibition or unenforceability, and 

such prohibition or unenforceability in such jurisdiction shall not invalidate or render 

unenforceable such provision in any other jurisdiction; and (iii) without limitation of clauses (i) 

or @, such ineffectiveness shall not invalidate any ofthe remaining provisions of this 

Agreement. Without limitation ofthe preceding sentence, it is the intent ofthe parties to this 

Agreement that in the event that in any court proceeding, such court determines that any 

provision ofthis Agreement is prohibited or unenforceable in any jurisdiction (because ofthe 

duration or scope (geographic or otherwise) of such provision, or for any other reason) such 

court shall have the power to, and shall, (x) modifY such provision (including, to the extent 

applicable, by limiting the duration or scope of such provision and/or the Persons against whom, 

and/or the circumstances under which, such provision shall be effective in such jurisdiction) for 

purposes of such proceeding to the minimum extent necessary so that such provision, as so 

modified, may then be enforced in such proceeding and (y) enforce such provision, as so 

modified pursuant to clause (x), in such proceeding. Nothing in this Section 11.7 is intended to, 

or shall, limit (1) the ability of any party to this Agreement to appeal any court ruling or the 

effect of any favorable ruling on appeal, or (2) the intended effect of Section 1 0.1. 

Section 11.8 Third Party Beneficiaries. The Initial Member shall be and is hereby 

designated as a third party beneficiary under this Agreement, and, as such, the Initial Member is 

entitled to enforce this Agreement as ifthe Initial Member were a party hereto. The Company, 

the Purchase Money Notes Guarantor, the Revolver Lender, the FDIC and any Indemnified Party 

shall be and are hereby designated as third party beneficiaries under this Agreement with respect 

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to those provisions of this Agreement which expressly grant rights to such Persons, and, as such, 

each is entitled to enforce such provisions ofthis Agreement as if such Person were a party 

hereto. Notwithstanding the foregoing, none ofthe Purchase Money Notes Guarantor, the 

Revolver Lender, the FDIC, the Company, the Initial Member and the Indemnified Parties shall 

have any obligation to undertake any ofthe duties of the Manager hereunder or have any liability 

whatsoever to the Servicer, any Subservicer or any other party related to this Agreement. There 

shall be no other third party beneficiaries. The rights ofthe Purchase Money Not~s Guarantor 

and the Revolver Lender as third party beneficiaries hereunder shall terminate at such time as the 

Purchase Money Notes Guarantor or the Revolver Lender, as applicable, notifies the Servicer 

that the reimbursement obligations in favor ofthe Purchase Money Notes Guarantor under the 

Reimbursement, Security and Guaranty Agreement or the Company's obligations under the 

Revolver, as the case may be, have been paid in full, but shall be reinstated in the event that the 

Purchase Money Notes Guarantor or the Revolver Lender, as applicable, notifies the Servicer 

that such obligations have been reinstated in accordance with its terms. 

Section 11.9 Protection of Confidential Information. The Servicer shall keep 

confidential and shall not divulge to any party, without the Manager's prior written consent, any 

information pertaining to the LLC Operating Agreement, the Loans or any Borrower or Obligor 

or the Underlying Collateral thereunder, except as required pursuant to this Agreement and 

except to the extent that it is necessary and appropriate for the Servicer to do so in working with 

legal counsel, auditors, taxing authorities, regulatory authorities or any other Governmental 

Authority or in accordance with the Servicing Standard; provided, that, to the extent that 

disclosure should be required by Law, rule, regulation (including any securities listing 

requirements or the requirements of any self~regulatory organization), subpoena, or in 

connection with any legal or regulatory proceeding (including in connection with or pursuant to 

any action, suit, subpoena, arbitration or other dispute resolution process or other legal 

proceedings, whether civil or criminal, and including before any court or administrative or 

legislative body), the Servicer will use all reasonable efforts to maintain confidentiality and will 

(unless otherwise prohibited by Law) notify the Manager, the Initial Member, the Revolver 

Lender and the Purchase Money Notes Guarantor within one (1) Business Day after its 

knowledge of such legally required disclosure so that the Manager, the Initial Member, the 

Revolver Lender and/or the Purchase Money Notes Guarantor may seek an appropriate 

protective order and/or direct the Manager to waive the Servicer's compliance with this 

Agreement. Notice shall be by telephone, by email and in writing. In the absence of a protective 

order or waiver, the Servicer may make such required disclosure if, in the written opinion of its 

outside counsel (which opinion shall be provided to the Manager, the Initial Member, the 

Revolver Lender and the Purchase Money Notes Guarantor prior to disclosure pursuant to this 

Section 11.9), failure to make such disclosure would subject the Servicer to liability for 

contempt, censure or other legal penalty or liability. 

Section 11.10 Time of Essence. Time is hereby declared to be ofthe essence of this 

Agreement and of every part hereof. 

Section 11.11 No Presumption. This Agreement shall be construed fairly as to each 

party hereto and if at any time any such term or condition is desired or required to be interpreted 

or construed, no consideration shall be given to the issue of who actually prepared, drafted or 

Structured Transaction Commercia12010-1 SFG LLC 

Servicing Agreement 

WDC991849433-4.084080.0017 

48 

requested any term or condition ofthis Agreement or any agreement or instrument subject 

hereto. 

Section 11.12 No Right of Setoff. The Servicer hereby waives any and all rights it may 

otherwise have (whether by contract or operation oflaw or otherwise) to any setoff, offset, 

counterclaim or deduction (or to assert any claim for any setoff, offset counterclaim or 

deduction) against the Loan Proceeds (or the Company). 

Section 11.13 Release of Initial Member and Others. The Servicer hereby releases and 

discharges each Prior Servicer :from any and all claims (including any counterclaim or defensive 

claim), demands, causes of action, judgments or legal proceedings and remedies ofwhatever 

kind or nature that the Servicer had, has or might have in the future, whether known or unknown, 

which are related in any manner whatsoever to the servicing ofthe Loans or Underlying 

Collateral prior to the applicable Servicing Transfer Date by the Prior Servicers, in each case 

other than for acts or omissions constituting gross negligence, violation of Law or willful 

misconduct ofsuch Prior Servicer. 

[Remainder ofPage Intentionally Left Blank] 

Structured Transaction Commercial2010-1 SFG LLC 

Servicing Agreement 

WDC99 1849433-4.084080.0017 

49 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed 

as of the day and year first above written. 

MANAGER: 

MIDLAND LOAN SERVICES, INC. 

By:_________ ____ 

Name: Bradley J. Hauger 

Title: Senior Vice President 

Structured Transaction Commercial2010-l SFG LLC 

Servicing Agreement 
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed 

as of the day and year first above written. 

MANAGER: 


SQUARE MILE LODGING RECOVERY LLC . 


By:. ____________ _ 


Name: 


Title: 


SERVICER: 


MIDLAND LOAN SER~CES, INC. 


By:-L-- [ ~===:!.-­ Name: Bradley J. Hauger 

Title: Senior Vice President 

Structured Transaction Commercial 20 I 0-1 SFG LLC 

Servicing Agreement 
EXHIBIT A 


LOAN SCHEDULE 


[Attached] 

Structured Transaction Commercial2010-1 SFG LLC 

Servicing Agreement 

WDC99 1849433-4.084080.0017 

B-1 

SCHEDULE 1 


FEE SCHEDULE 


[To be provided by Servicer and Manager] 

Structured Transaction Commercial 20 I0-1 SFG LLC 

Servicing Agreement 

WDC99 1849433-4.084080.0017 

SCHEDULE 1 

1 
SCHEDULE 1 


FEE SCHEDULE 

SCHEDULE2 


SERVICING OBLIGATIONS 


[To be provided by Servicer and Manager] 

Structured Transaction Commercial2010-1 SFG LLC 

Servicing Agreement 

WDC99 1849433-4.084080.0017 

SCHEDULE2 

1 
SCI£llUl£ 2 

~~) 

SlJvmDn SFG Transaction 
SCHEDIJt.E2 

(Setviirig~) 

Silvtrton SFG T1111Sidion 
SCHEDULE2 

Seri~ Oli~s) 

Silverton SFG Transaction 
SCHEOIJLE 2 

(~0~) 

Silverton SFG Transaction 

... . 

SCHEDULE3 


REIMBURSEMENT OF SERVICER ADVANCES 


[To be provided by Servicer and Manager] 

Structured Transaction Commercial 20 I0-1 SFG LLC 

Servicing Agreement 

WDC99 1849433-4.084080.0017 

SCHEDULE3 

1 
SCHEDULE3 


(Reimbursement of Servicer Advances) 


Not Applicable. 


NY 240,287,724v1 5-11-10 
SCHEDULE4 


FORM OF ELECTRONIC REPORT ON THE LOANS AND COLLATERAL 


[To be provided by Servicer and Manager] 

Structured Transaction Commercial2010-l SFG LLC 

Servicing Agreement 

WDC99 1849433-4.084080.0017 

SCHEDULE4 

1 

SCHEDULE4 


(Form ofElectronic Report) 


-See Attached-


NY 240,287,724v1 5-11-10 
Other Reports 

Withdrawals from Collection Account 

Manager hereby certifies that all withdrawals by the Manager from the Collection Account during the 

relevant Due Period were made in accordance with the terms ofthe Amended and Restated Limited 

Liability Company Operating Agreement and the Custodial Agreement: Y I N 

Delinquency Report 

#and$ by delinquency classification: Current,< 30, 30-60 days, 61-90 days,> 90 days, in foreclosure, in 

bankruptcy, REO 

Breakout of> 60 day delinquencies by collateral type,# and$ 

Breakout of> 60 day delinquencies by state,# and$ 

REO Report 

Listing ofREO properties held to include original loan number, date ofownership, description, collateral 

type, address, UPB (of the loan prior to foreclosure), net book value, listing date, estimated sale date, 

appraisal amount, original list price, current list price, cumulative Servicing Expenses allocable, broker 

name, and comments 

Modification Report 

Listing of loans modified, to include borrower name, loan balance and terms before modification, loan 

balance and terms after modification. Show amounts ofprincipal forgiven, if any, and principal 

forbearance amounts, if any. 

Liquidation Report 

Listing of loans and REO properties liquidated, to include borrower name, UPB, net liquidation proceeds, 

cumulative Servicing Expenses, realized loss amount 

Short Sale Report 

Listing of loans for which short sales were accepted, to include borrower name, UPB, payoff accepted, 

realized loss amount 

Judgment Report 

Listing of Judgments obtained, to include borrower name, Judgment amount, current month and 

cumulative payments received, remaining balance 
S ignificant L itigation R eport 

Company and/or Servicer with respect to assets subject to this Agreement, the actions taken to defend 

such claim, and an estimate ofthe rojected exposure for: a) any claim in which the Company or Servicer 

expects to incur more than in Servicing Expenses to defend such claim, b) any claim in which 

multiple plaintiffs have joined in fi ing an action against the Company and/or Servicer or the same law 

firm has filed individual claims on behalf ofmore than one plaintiff, and c) any claim(s) regardless ofthe 

dollar amount naming: ( i) any Failed Bank, or (ii) FDIC (in any capacity) as defendant(s). Activity 

should be updated quarterly. 

Environm ental Exposure R eport 

Provide a report identifying any assets in which the Site Assessment identified an Environmental Haz!lfd 

together with information on the nature ofthe hazard, additional tests performed, and the cost of 

correcting the hazard identified in the Site Assessment. 

MONTHLY L OAN-LEVEL DETAI L REPORTS 

Monthly L oan Trial Balance and Activity Report 

PROVIDE A MONTHLY LOAN-LEVEL REPORT 

IN EXCEL WITH THE FOLLOWING FIELDS: 

Current Loan Number 

Prior Servicer Loan Number 

P&l Constant 

Note Rate 

Next Due or Paid-Thru Date 

Payoff Date 

Principal collections - regular 

Principal collections - payoffs 

Principal proceeds - loan sales 

Principal Write-Off Amount 

Other Non-Cash Principal Adjustment 

T ransfer to REO 

Escrow balance 

Other Advances Balance 

Interest collections - regular 

Interest collections - payoffs 

Interest collections - loan sales 

Non-Cash Interest Adjustment 

Late Charges 

Pre-Payment Penalty Paid 

Other Fee Income 

Servicing Svstem Data Do wnload - To Initial Member 
Provide a monthly loan-level data download in Excel format with every field populated in the Servicer's 

loan servicing system. This requirement may be modified in the future by the Initial Member to include 

only certain specified fields. 

SEMIANNUAL REPORT- TO INITIAL MEMBER (in January and July ofeach year, commencing 

July 2010) 

Business Plan 

Updated Consolidated Business Plan and individual Business Plans for 10 largest Loans, as required 

pursuant to Section 7.7 ofthe Amended and Restated Limited Liability Company Agreement. 

Projected Cash Flows 

Excel model ofprojected cash flows by month, as of June 30 and December 31 of each year, as required 

pursuant to Section 7.7(c) ofthe Amended and Restated Limited Liability Company Agreement. 

ASAVAILABLE- TO INITIAL MEMBER 

Custodial Report or an updated Loan Schedule and Exception List (in each case as defined in the 

Custodial Agreement) from the Custodian/Paying Agent, as provided to the Company. 
SCHEDULES 


TERMINATION WITHOUT CAUSE 


[To be provided by Servicer and Manager] 

Structured Transaction Commercial2010·1 SFG LLC 

Servicing Agreement 

WDC99 1849433-4.084080.0017 

SCHEDULES 

1 
SCHEDULES 


(Termination Without Cause) 


The Manager may, without cause, terminate this Agreement, by providing Servicer with a 

Termination Notice at least thirty (30) days prior to the effective date of such termination. 

NY 240,287, 724v1 5-11-10 
SCHEDULE6 


BUSINESS PLANS AND CONSOLIDATED BUSINESS PLANS 


[To be provided by Servicer and Manager] 

Structured Transaction Commercial2010-1 SFG LLC 

Servicing Agreement 

WDC99 1849433-4.084080.0017 

SCHEDULE6 

1 
To be provided post-closing.