SOUTH CRE VENTURE 2010-2 Structured Transaction 

SERVICING AGREEMENT 

by and between 

HRC SVC SOUTH 2010, LLC 

and 

MIDLAND LOAN SERVICES, INC. 

Dated as of December 2, 2010 

SOUTH CRE VENTURE 2010-2 Structured Transaction 

Servicing Agreement 

EXECUTION VERSION 
TABLE OF CONTENTS

 

Page 

Article I DEFINITIONS AND CONSTRUCTION 1

 

Section 1.1 Definitions 1

 

Section 1.2 Construction 2

 

Article II SERVICING OBLIGATIONS OF THE SERVICER 3

 

Section 2.1 Appointment and Acceptance as Servicer 3

 

Section 2.2 Limited Power of Attorney 3

 

Section 2.3 Servicing Fee 3

 

Section 2.4 Servicing Standard 3

 

Section 2.5 Collection Account 4

 

Section 2.6 Working Capital Account 5

 

Section 2.7 Escrow Accounts 5

 

Section 2.8 Other Accounts 5

 

Section 2.9 Maintenance of Insurance Policies; Errors and Omissions and

 

Fidelity Coverage 6

 

Section 2.10 Funding of Working Capital Expenses and Funding Draws 7

 

Section 2.11 Expenses 8

 

Section 2.12 Insured or Guaranteed Assets 8

 

Section 2.13 Registration with MERS 8

 

Section 2.14 Retained Obligations 9

 

Article III DEFAULTS; ACQUISITION OF COLLATERAL 9

 

Section 3.1 Delinquency Control 9

 

Section 3.2 Discretion of the Servicer in Responding to Defaults of

 

Borrower 9

 

Section 3.3 Acquisition of Acquired Property 10

 

Section 3.4 Administration of Acquired REO Properties 10

 

Article IV SUBSERVICING 12

 

Section 4.1 Retention of Subservicer 12

 

Section 4.2 Subservicing Agreement Requirements 12

 

Section 4.3 Servicer Liable for Subservicers 15

 

Section 4.4 Manager Approval Required 15

 

SOUTH CRE VENTURE 2010-2 Structured Transaction 

Servicing Agreement 

EXECUTION VERSION 
16 

Article V REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE 

SERVICER 

Section 5.1 Representations and Warranties 16

 

Section 5.2 Reporting, Books and Records and Compliance Covenants 17

 

Section 5.3 Audits 19

 

Section 5.4 No Liens 20

 

Section 5.5 Servicer's Duty to Advise; Delivery of Certain Notices 20

 

Section 5.6 Notice of Breach or Change of Control 21

 

Section 5.7 Copies of Documents 21

 

Section 5.8 Financial Information 22

 

Article VI MANAGER CONSENT 22

 

Section 6.1 Actions Requiring Manager Consent 22

 

Section 6.2 Amendments, Modification and Waivers 23

 

Article VII DEFAULTS; TERMINATION; TERMINATION WITHOUT CAUSE 23

 

Section 7.1 Defaults 23

 

Section 7.2 Termination with Cause 25

 

Section 7.3 Termination without Cause 26

 

Section 7.4 Effective Termination Date 27

 

Section 7.5 Accounting 27

 

Article VIII INDEPENDENCE OF PARTIES; INDEMNIFICATION 27

 

Section 8.1 Independence of Parties 27

 

Section 8.2 Indemnification 27

 

Section 8.3 Procedure for Indemnification 28

 

Section 8.4 Pre-Effective Date Liabilities 28

 

Article IX NOTICES 29

 

Article X GOVERNING LAW; JURISDICTION 30

 

Section 10.1 Governing Law 30

 

Section 10.2 Jurisdiction; Venue and Service 31

 

Section 10.3 Waiver of Jury Trial 33

 

Article XI MISCELLANEOUS 33

 

Section 11.1 No Assignment by Servicer; No Transfer of Ownership

 

Interests in Servicing Rights 33

 

Section 11.2 Legal Fees 34

 

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Servicing Agreement 

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Section 11.3 

Section 11.4 

Section 11.5 

Section 11.6 

Section 11.7 

Section 11.8 

Section 11.9 

Section 11.10 

Section 11.11 

Section 11.12 

Section 11.13 

Entire Agreement 34 

Counterparts; Facsimile Signatures 34 

Headings 34 

Compliance with Law 34 

Severability 34

 

Third Party Beneficiaries 35

 

Protection of Confidential Infoimation 35 

Time of Essence 36

 

No Presumption 36 

No Right of Setoff 36 

Release of Initial Member and Others 36

 

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Servicing Agreement 

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SCHEDULES AND EXHIBITS

 

Exhibits 

Exhibit A 

Exhibit B 

Schedules 

Schedule 1 

Schedule 2 

Schedule 3 

Schedule 4 

Schedule 5 

Schedule 6 

Schedule 7 

Asset Schedule 

Electronic Tracking Agreement 

List of Various Failed Financial Institutions 

Fee Schedule 

Servicing Obligations 

Reimbursement of Servicer Advances 

Form of Electronic Report on the Assets and Collateral 

Termination Without Cause 

Business Plans and Consolidated Business Plans 

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Servicing Agreement 

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SERVICING AGREEMENT 

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

"Agreement") is made and entered into as of the 2 nd day of December, 2010 (the "Effective 

Date"), by and between HRC SVC SOUTH 2010, 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, South CRE Venture 2010-2, LLC (the "Company") owns the Assets 

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

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

responsibility to service and manage the Assets and related Collateral (as defined below) 

pursuant to the LLC Operating Agreement; and 

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

the Assets and Collateral on behalf of the Company and the Manager in a manner that is, at all 

times, consistent with the requirements of this Agreement. 

NOW, THEREFORE, in consideration of the 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. Capitalized terms used in this Agreement shall have the 

meanings assigned to them in, or by reference in, that certain Agreement of Common 

Definitions, dated as of the Closing Date, among the Initial Member, the Servicer, the Private 

Owner, the Purchase Money Notes Guarantor and others with respect to the transaction (the 

"Agreement of Common Definitions"). 

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

"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 of the Servicer). 

"Default" shall have the meaning given in Section 7.1. 

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

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

SOUTH CRE VENTURE 2010-2 Structured Transaction 

Servicing Agreement 

EXECUTION VERSION 
"Fee Schedule" shall mean Schedule 2, as the same may be amended from time to time 

by the Manager and the Servicer without the consent of the Required Consenting Parties. 

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

"Other Accounts" shall have the meaning given in Section 2.7. 

"Retainer Obligations" shall have the meaning given in Section 2.14. 

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

Servicing Expenses. 

"Servicing Fee" shall have the meaning given in Section 2.3. 

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

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

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

"Specified Date" shall mean the 10th 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. 

"Termination Notice" shall mean any written notice of termination required pursuant to 

Article VII. 

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

accordance with the following: 

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

only such other Persons which from time to time constitute "Affiliates" of such 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" of such 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 

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. 

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

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

provision of this 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 of time 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 of the appropriate gender. 

ARTICLE II 

SERVICING OBLIGATIONS OF THE SERVICER 

Section 2.1 Appointment and Acceptance as Servicer. Effective as of the date hereof 

(and, with respect to each Asset or Group of Assets, as of the applicable Servicing Transfer Date 

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

dispose of the Assets and the Collateral on behalf of and as an agent of the 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 of the Company) in accordance with the Servicing 

Standard set forth below 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 of the limited power of attorney shall take effect upon: (i) the receipt by the Servicer 

of written notice thereof from or on behalf of the Manager, or (ii) teimination of this Agreement 

pursuant to Article VII. 

Section 2.3 Servicing Fee. As consideration for servicing the Assets and the 

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 of the 

Assets and Collateral as are set forth on Schedule 3, as the same may be amended from time to 

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

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

in accordance with the terms of the Assets (and related Asset Documents), (iii) in accordance 

with the terms of this Agreement (including this Article II), (iv) in accordance with all applicable 

Laws, (v) subject to Section 5.7, in accordance with the requirements of the LLC Operating 

Agreement, the Custodial and Paying Agency Agreement and the other Transaction Documents, 

and (vi) to the 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 

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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 of practice of prudent mortgage 

lenders, loan servicers and asset managers servicing, managing and administering similar loans 

and properties on an arms' length basis, provided that, with respect to each Asset and related 

Collateral, in the absence of a customary and usual standard of practice, the Servicer shall 

comply with the applicable Fannie Mae Guidelines, if any, with respect to similar loans or 

properties in similar situations (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 Affiliates may have to any Borrower or Obligor or any of their 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 Assets and the 

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

the Company, the Manager or any of their respective Affiliates, or any relationship that any of 

their respective Affiliates may have to the Company, the Manager or any of their 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 Asset Proceeds 

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

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

other source (other than interest or earnings on the Asset Proceeds, amounts released from the 

Working Capital Reserve Account, and the proceeds of Excess 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 of payment of applicable Working Capital Expenses (including the making of 

applicable Funding Draws); provided, however, that if the 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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EXECUTION VERSION 
(d) The Collection Account (and all funds therein) will be subject to an 

account control agreement among the Company, the Collateral Agent and the Paying Agent. 

Section 2.6 Working Capital Reserve Account. 

(a) Pursuant to the LLC Operating Agreement and the Custodial and Paying 

Agency Agreement, the Company has established the Working Capital Reserve Account to be 

maintained with the Paying Agent, and the Initial Member and'the Private Owner have funded 

into such Working Capital Reserve Account a reserve (together with such additional amounts as 

may from time to time be in such Working Capital Reserve Account, the "Working Capital 

Reserve Account") in an initial amount equal to the Working Capital Reserve Account Floor for 

purposes of funding Working Capital Expenses of the Company to the extent there are 

insufficient funds for payment of the same from the funds in the Collection Account. Except as 

otherwise directed by the Manager, the Servicer shall not cause funds from any other source 

(other than interest or earnings on the Working Capital Reserve Account) to be commingled in 

the Working Capital Reserve Account (it being understood that deposits into such Working 

Capital Reserve Account shall be made only pursuant to the Custodial and Paying Agency 

Agreement and the LLC Operating Agreement). 

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

deposit in the Working Capital Reserve 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). 

(c) The Working Capital Reserve Account (and all funds therein) will be 

subject to an account control agreement among the Company, the Collateral Agent and the 

Paying Agent. 

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

Servicer shall establish and maintain one or more Eligible Accounts, each of which shall be held 

in trust for the benefit of the Company and the Collateral Agent (each, an "Escrow Account", 

which term shall include all so-called "lockbox" accounts maintained under the Asset 

Documents and any other accounts maintained by the Company under the Asset 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 within two (2) Business Days of receipt all collections from the Borrowers for 

the payment of taxes, assessments, hazard insurance premiums, and comparable items for the 

account of the Borrowers, and all other amounts required to be deposited in such Escrow 

Account pursuant to the applicable Asset Documents. The Servicer shall pay to the Borrowers 

interest on funds in Escrow Accounts to the extent required by Law or the applicable Asset 

Documents. 

Section 2.8 Other Accounts. At the direction of the 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 of the 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"). 

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EXECUTION VERSION 
Section 2.9 Maintenance of Insurance Policies; Errors and Omissions and Fidelity 

Coverage. 

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

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

Operating Agreement and, for so long as the same remains in effect the Reimbursement, Security 

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

each Asset 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 Collateral is located and in such amounts and with such deductibles as, from time to 

time, are directed by the Manager. 

(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 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 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 would reduce the limits by 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 and alteration, wire/funds transfer, 

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

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

money, documents or papers relating to any Asset, 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 of the Manager and the Company. 

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Servicing Agreement 

EXECUTION VERSION 
(v) Auto liability with a combined single limit of not less than 

$1,000,000 to provide coverage for any owned, hired, 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 of premium whereby a ten (10) 

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

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

above. 

The Servicer shall provide (or shall cause each Subservicer to provide) each Required 

Consenting Party and the Manager with certificates evidencing all such policies on the Effective 

Date (and, with respect to each Asset, the applicable Servicing Transfer Date with respect 

thereto) and each anniversary of the Closing Date thereafter, and otherwise upon request of any 

Required Consenting Party or the Manager. 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 Required Consenting Parties or their respective representatives on the Effective Date (and, 

with respect to each Asset, on the applicable Servicing Transfer Date with respect thereto), and 

shall otherwise be made available to the Manager and any of the Required Consenting Parties 

and their respective representatives 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 of the Manager, in turn acting on behalf of the 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, the 

applicable terms and conditions in the LLC Operating Agreement and the other Transaction 

Documents. Servicer acknowledges that (a) subject to the Custodial and Paying Agency 

Agreement (and any permitted transfer or release of funds as provided therein), the Working 

Capital Reserve Account shall be used exclusively for funding of Working Capital Expenses 

(including the making of applicable Funding Draws with respect to specified Assets or related 

Acquired Property), but only if there are insufficient available funds in the Collection Account; 

(b) proceeds of Discretionary Funding Advances shall be used exclusively for making Funding 

Draws with respect to specified Assets 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 (c) proceeds of Excess Working Capital Advances shall be used 

exclusively for payment of 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 

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EXECUTION VERSION 
for such other purposes as may be expressly permitted pursuant to 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 Borrowers and 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 Asset Documents. All such amounts not recovered from 

Borrowers or Obligors and all other Servicer Advances shall be reimbursed only in accordance 

with the terms set forth on Schedule 4, as the same may be amended from time to time by the 

Manager (without the consent of the Initial Member) and the Servicer. In no event may any 

Servicer Advances be deducted from or netted against any Asset 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 requesting the same. No Servicer 

Advances shall bear interest chargeable in any way to the Company or deductible from any Asset 

Proceeds. 

Section 2.12 Insured or Guaranteed Assets. If any Assets 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 Assets, it shall take any and all actions as may be necessary to insure that 

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

agrees that, upon assumption of the Servicing Obligations with respect to the Assets pursuant to 

this Agreement, it shall 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 of the Assets are (or are 

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

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

on behalf of the Company (including, as applicable, on behalf of the Manager, in turn 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 an Asset in the name of 

MERS®, solely as nominee for the Company and its successors and assigns. With respect to 

each Asset that is registered on the MERS® System, (A) the Servicer shall be designated as the 

"servicer" and the 1000002 Org Id shall be designated as the "investor" with respect to such 

Asset, and, if applicable, the Manager may cause or permit an applicable Subservicer to be 

designated as the "subservicer" with respect to such Asset (provided, that, at the option of the 

Manager in accordance with the LLC Operating Agreement and so long as each applicable 

designee is and remains a MERS member in good standing, (1) the Company may be designated 

as the "investor" with respect to any such Asset, and (2) the Manager may be designated as the 

"servicer" with respect to any such Asset, in which case the Servicer shall be designated as the 

"subservicer" with respect thereto), and (B) no other Person shall be identified on the MERS® 

System as having any interest in such Asset unless otherwise consented to by the Manager (or 

required pursuant to the Electronic Tracking Agreement). Except as otherwise directed by the 

Manager (in connection with a voluntary removal by the Manager of any Asset from the 

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Servicing Agreement 

EXECUTION VERSION 
MERS® System pursuant to Section 12.3(g) of the LLC Operating Agreement), all Assets 

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 of the Assets and to confirm that the Assets required to be registered on the 

MERS® System are so registered. For so long as any Assets remain registered with MERS, the 

same shall be subject to an Electronic Tracking Agreement in the foim of Exhibit B, and, to the 

extent any such Assets are so registered with MERS as of the Closing Date, the Servicer, 

together with the Manager, the Collateral Agent and the Initial Member, shall execute such 

Electronic Tracking Agreement on the Closing Date and deliver the same to MERS. Without 

limiting the foregoing, upon the request of the 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 Assets 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 

(and subject to any applicable provisions of the Electronic Tracking Agreement), 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. 

Section 2.14 Retained Obligations. As used herein, the "Retained Obligations" shall 

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

obligations set forth on Schedule 3 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 of the 

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

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

ARTICLE III 

DEFAULTS; ACQUISITION OF COLLATERAL 

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

Servicer shall maintain a collection department that complies with the Servicing Standard and 

protects the Company's interests in the Assets and the 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 Asset Documents, but subject to the other 

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

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 of the Manager, shall 

determine the response to such default and the 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 Asset and the Collateral, (b) the 

declaration and recording of a notice of such default and the acceleration of the maturity of the 

Asset, (c) the institution of proceedings to foreclose the Asset Documents, Collateral or Acquired 

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Property or appoint a receiver securing the Asset pursuant to the power of sale contained therein 

or through a judicial action, (d) the institution of proceedings against any Obligor, (e) the 

acceptance of a deed in lieu of foreclosure, (f) the purchase of the real property Collateral at a 

foreclosure sale or trustee's sale or the purchase of the personal property Collateral at a UCC 

sale, and (g) the institution or continuation of proceedings to obtain a deficiency judgment 

against the related Borrower or any Obligor and the collection of any 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 if the taking (or refraining from taking) of such action is inconsistent with the terms of 

the LLC Operating Agreement or any other Transaction Documents without the prior written 

consent of the Manager. 

Section 3.3 Acquisition of Acquired Property. Any acquisition of Collateral shall 

conform with the terms and conditions of this Agreement (including the Servicing Obligations of 

the Servicer). With respect to any Asset as to which the Servicer has received actual notice of, or 

has actual knowledge of, any Environmental Hazard with respect to the related 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 Collateral, the Servicer shall cause to 

be commissioned with respect to such 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 otherwise directed by the Manager, 

the Servicer or any Subservicer shall not acquire or otherwise cause the Company or any 

Subsidiary or other entity in which the Company owns any interest to acquire all or any portion 

of any Collateral having any actual or threatened Environmental Hazard by foreclosure, deed in 

lieu of foreclosure, power of sale or sale pursuant to the UCC or otherwise. If title to any 

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 UCC, 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 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 Collateral may hold title only to the relevant Collateral with respect to which the 

Environmental Hazard exists. 

Section 3.4 Administration of Acquired REO Properties. In addition to any other 

terms and conditions set forth herein, in connection with any Acquired 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 Operating 

Agreement. 

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(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 Acquired 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 of the Acquired REO Property owned by such 

Ownership Entity, or use or permit the use of any portion of an Acquired 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 of 

the Manager and the Required Consenting Parties. 

(d) The Servicer shall not permit any Ownership Entity to suffer, permit or 

initiate the joint assessment of Acquired REO Property (i) with any other real property 

constituting a tax lot separate from such Acquired REO Property, and (ii) with any portion of an 

Acquired 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 Acquired REO Property. 

(e) From and after the completion of any buildings or other improvements at 

an Acquired REO Property, the Servicer shall cause the applicable Ownership Entity to maintain 

such Acquired 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 other Transaction Documents) 

and in accordance with applicable Law. 

(f) All property managers with respect to any Acquired 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 of the Collateral Agent under the applicable REO Mortgage. 

(g) With respect to any Acquired REO Property that is leased under a ground 

or other 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 of the 

applicable ground lease as and when such rent or other charge is payable, and (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 Acquired REO Property without the 

prior consent of the Manager 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 Acquired 

REO Property (pursuant to Funding Draws for such purpose), then the Servicer shall cause each 

Ownership Entity to pursue with diligence the construction of the Acquired REO Property 

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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 Acquired 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 Acquired 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 all 

other applicable requirements set forth herein and in the other Transaction Documents for 

Funding Draws. 

(i) Notwithstanding any other provision of this Section 3.4 to the contrary, (i) 

in operating, managing, leasing or disposing of any Acquired REO Property, the Servicer shall 

act in the best interests of the Company, and the members and creditors of the 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 provision of this Section 3.4 if such action is (A) not in the best interests of 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. 

(j) The Servicer shall furnish to the Manager, the Collateral Agent and the 

Initial Member such reports regarding the construction, leasing and sales efforts of or relating to 

the Acquired REO Property as the Manager, 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 of the 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: 

(a) provide for the servicing of the Assets and management of the Collateral 

by the Subservicer in accordance with the Servicing Standard and the other terms of this 

Agreement and the LLC Operating Agreement; 

(b) subject to Section 4.2(m) and Section 4.2(n) with respect to immediate 

termination, be terminable upon no more than thirty (30) days prior notice in the event of any 

Event of Default (as defined in the LLC Operating Agreement), any Default under this 

Agreement or any default under the Subservicing Agreement; 

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(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 of the 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 of the FDIC, the Purchase Money Notes Guarantor 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 of the FDIC, the Purchase Money Notes Guarantor 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 removal of the 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 of Default under the LLC Operating Agreement, the Initial Member 

(and any successor "Manager" under the LLC Operating Agreement) may exercise all of the 

rights of the Manager under this Agreement and any Subservicing Agreement and further cause 

the termination or assignment to any other Person of this Agreement (and, in the event of any 

such termination or assignment of this Agreement, the termination or assignment of any 

Subservicing Agreement), without penalty or payment of any fee, and (ii) upon the occurrence of 

any Default under this Agreement or an event described in clauses (ii), (iii) or (iv) of Section 

7.2(a) hereof, each of the Manager (or applicable successor "Manager" under the LLC Operating 

Agreement) and the Initial Member may exercise all of the rights of (A) the Manager under this 

Agreement and cause the termination or assignment of this 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 of the Subservicing Agreement to any other Person, 

without penalty or payment of any fee; 

(g) provide that the Initial Member, the Manager, the Purchase Money Notes 

Guarantor and the Company (and each of their respective representatives) shall each have access 

to and the right to review, copy and audit the books and records of the 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 and the 

Company's (and each of their respective representatives') questions or to discuss any matter 

relating to the Subservicer's affairs, finances and accounts, as they relate to the Assets, the 

Collateral, the Servicing Obligations, the Collection Account, the Escrow Accounts or any Other 

Accounts established or maintained pursuant to this Agreement or the Subservicing Agreement, 

accounts established or maintained pursuant to the Custodial and Paying Agency Agreement or 

any matters relating to this Agreement or the Subservicing Agreement or the rights or obligations 

thereunder; 

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(h) provide that all Asset Proceeds are to be deposited into the Collection 

Account on a daily basis (without reduction or setoff as provided in Section 11.12 hereof) within 

two (2) Business Days of receipt and that under no circumstances are any funds, other than Asset 

Proceeds and interest and earnings thereon and amounts released from the Working Capital 

Reserve Account, the proceeds of 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; 

(j) provide that the Subservicer consents to the immediate termination of the 

Subservicer pursuant to Section 7.2 and Section 7.3 of this Agreement; 

(k) provide that there shall be no right of setoff on the part of the Subservicer 

against the Asset 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 of the Servicer 

hereunder in the conduct of such matters as are delegated to the Subservicer; 

(m) (i) contain default provisions that relate to the actions of the Subservicer 

that correspond to the provisions of Section 7.1(a), (b), (c), (d), (e), (f), (g), (h), (g) and (i) of this 

Agreement, and (ii) provide that each of the Manager and the Initial Member has the right (x) to 

immediately teitninate the Subservicing Agreement by providing written notice upon the 

occurrence of any such default or an event described in clauses (ii), (iii) or (iv) of Section 7.2(a) 

hereof, 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 of this 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 

7.1(a), Section 7.1(b), or Section 7.1(c) of this Agreement, or (y) an Insolvency Event with 

respect to the Subservicer or any of its 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 of the Initial Member, the Company, 

the Existing Servicers (as defined in the Contribution Agreement), the FDIC, in relation to any 

particular Asset, the relevant Failed Bank and any predecessor-in-interest thereof, any 

Ownership Entities existing as of the applicable Servicing Transfer Date, and all of their 

respective officers, directors, employees, agents, attorneys, contractors and representatives, and 

all of their 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 proceedings and remedies of whatever kind or nature that the Subservicer had, has or might 

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have in the future, whether known or unknown, which are related in any manner whatsoever to 

the servicing of the Assets by the Prior Servicers prior to the applicable Servicing Transfer Date 

(other than due to gross negligence, violation of law or willful misconduct of such Prior 

Servicer); 

(p) provide that, to the extent required under Section 2.13 hereof (or Section 

12.3(g) of the LLC Operating Agreement), all Assets registered on the MERS® System shall 

remain registered unless default, foreclosure or similar legal or MERS requirements dictate 

otherwise or unless otherwise directed by the Manager; 

(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 

of this Agreement, the LLC Operating Agreement, the Custodial and Paying Agency Agreement 

or any of the other Transaction 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 of the 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 of 

this 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 of the Servicer. All actions of any Subservicer perfolined 

pursuant to the Subservicing Agreement with the Servicer shall be perfoinied as an agent of the 

Servicer. No Subservicer shall be paid any fees or indemnified out of any Asset Proceeds, it 

being understood that all fees and related costs and liabilities of retaining any Subservicers shall 

be the sole responsibility of the Servicer. 

Section 4.4 Manager Approval Required. Each Subservicing Agreement and all 

amendments and modifications thereto and the selection of the Subservicer, regardless of 

whether the Subservicer is an Affiliate of the Servicer, shall be subject to the prior written 

approval of the 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 and, upon request of any Required Consenting Party, to such 

Required Consenting Party. 

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 

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has in place, policies and procedures to comply with the relevant servicing criteria provisions of 

Section 1122(d)(1) of Regulation AB that are applicable and relate to the servicing being 

conducted under this Agreement, including for purposes of preparation and delivery of the 

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. 

ARTICLE V 

REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SERVICER 

Section 5.1 Representations and Warranties. The Servicer hereby makes the following 

representations and warranties as of the date hereof: 

(a) The Servicer (i) is a corporation duly organized, validly existing and in 

good standing under the laws of the 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 Assets or the nature of the 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 Asset, 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 of the Servicer. 

(c) This Agreement and all agreements contemplated hereby to which the 

Servicer is or will be a party constitute the valid, legal, binding and enforceable obligations of 

the 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 of whether 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 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 of the Servicer are duly 

authorized to do so. 

(e) The execution and delivery of this Agreement by the Servicer, the 

servicing of the Assets and the Collateral under this Agreement, the consummation of any other 

of the transactions contemplated by this Agreement, and the fulfillment of or compliance with 

the terms hereof are in the ordinary course of business of the Servicer and will not (i) result in a 

breach of any term or provision of the articles or charter or bylaws or other organizational 

documents of the Servicer; (ii) conflict with, result in a breach, violation or acceleration of, or 

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result in a default (or an event which, with notice or lapse of time, 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. 

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 of the Servicer to perform its 

obligations under this Agreement or the financial condition of the 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 of the 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 of the 

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 infoimation returns related to each Asset for all applicable periods commencing with the 

Servicing Transfer Date with respect thereto (or, if later, the Effective Date). Information returns 

include reports on Fowls 1098 and 1099 and any other reports required by Law. The Servicer 

shall be responsible for submitting all infoimation returns required under applicable Law of any 

foreign Governmental Authority, to the extent such are required to be filed by the Company 

under such Law, relating to the Assets, 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 Assets and the 

Collateral, and the Company's and the relevant secured parties' interests in the Assets and the 

Collateral, including records relating to the Collection Account, the Working Capital Reserve 

Account, the Escrow Accounts and any Other Accounts maintained in connection with the 

Assets, Servicer Advances, Funding Draws and other Working Capital Expenses and collection 

and remittance of Asset Proceeds. The books of account shall be maintained in a manner that 

provides sufficient assurance that: (i) transactions of the Company are executed in accordance 

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with the general or specific authorization of the Manager consistent with the provisions of the 

LLC Operating Agreement; and (ii) transactions of the Company are recorded in such form and 

manner as will: (A) permit preparation of federal, 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 of the 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 of ten (10) years after the Closing Date and three (3) years 

after the date on which the Final Distribution is made, 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, 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 teen hereof, at such other location as is provided by notice to the 

Manager, the FDIC, the Purchase Money Notes Guarantor 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 of the 

Manager, shall promptly send copies (the number of copies of which shall be reasonable) of such 

books and records to the Manager. The Servicer shall provide the Manager with reasonable 

advance notice of the Servicer's intention to destroy or dispose of any documents or files relating 

to the Assets and, upon the request of the 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 of taxes, ground rents and other recurring charges which could 

become a Lien on any Collateral. 

(d) The covenants set forth in Section 5.2(b) and (c) above to maintain a 

complete and accurate set of records shall encompass all files in the Servicer's custody, 

possession or control pertaining to the Assets and the 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 Assets and the Collateral, all documentation relating to 

items of income and expense pertaining to the Assets and the Collateral, and all of the Servicer's 

(and any Subservicer's) internal memoranda pertaining to the Assets and the Collateral. 

(e) The Servicer shall cause to be furnished to the Manager, each month on 

the Specified Date, commencing with February 2011 (or such other date as may be set forth in 

the Servicing Obligations), a monthly electronic report on the Assets and Collateral containing 

such information and substantially in the form set forth on Schedule 5 as the same may be 

amended from time to time by the Manager (without the consent of the 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", and such other reports 

and information as the 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 

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Member is obligated to provide such information (or other infoimation 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 of the 

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 and each Required Consenting Party, on or before March 10th of each year, or such 

other day as the Manager and the Servicer may agree, commencing in the year 2012, 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(0) 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 of its 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 Asset, shall cover the period 

commencing on the Servicing Transfer Date and continuing through the end of the 2011 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 Asset, on the Servicing Transfer Date through the 

end of the 2011 calendar year), such party shall provide an officer's certificate pursuant to this 

Section 5.2 with respect to such portion of the year (or other applicable period). 

(g) On or before March 10th of each year, or such other day as the Manager 

and the Servicer agree, commencing in the year 2012, the Servicer shall, or shall cause each 

applicable Subservicer to, provide to the Manager and each Required Consenting Party (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 of whether any such requirements apply, by 

their terms, only to companies registered or required to file reports with the Securities and 

Exchange Commission) with respect to the relevant servicing criteria provisions of Section 

1122(d)(1) of Regulation AB that are applicable to the servicing being conducted under this 

Agreement pursuant to Section 4.5 above. The first such reports shall cover the period 

commencing on the Effective Date (and for each Asset, covering the period from the applicable 

Servicing Transfer Date) and continuing through the end of the 2011 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 7 

hereto as the same may be amended from time to time by the Manager and the Servicer without 

the consent of the Initial Member (the "Business Plan Schedule"). Upon reasonable notice by 

any Required Consenting Party or the Manager, the Servicer shall make its personnel who are 

familiar with the Business Plans and Consolidated Business Plans (or relevant portions thereof) 

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available during normal business hours for the purposes of discussing such Business Plans and 

Consolidated Business Plans with representatives of the Required Consenting Party and/or the 

Manager and responding to questions therefrom. 

Section 5.3 Audits. Until the later of the date that is ten (10) years after the Closing 

Date and the date that is three (3) years after the Final Distribution, which date shall be 

established by notice to the Servicer from the Manager, the Servicer shall, and shall cause each 

Subservicer to, (a) provide the Manager, the Purchase Money Notes Guarantor and the Initial 

Member and their respective representatives (including any Governmental Authority), during 

noinial business hours and on reasonable notice, with access to and the right to review all of the 

books of account, reports and records relating to the Assets or any Collateral, the Servicing 

Obligations, the Collection Account, the Working Capital Reserve Account, the Escrow 

Accounts, any Other Accounts or any matters relating to this Agreement or the rights or 

obligations hereunder or the other Transaction Documents, (b) permit such representatives to 

make copies of and extracts from the same, (c) allow the Manager, the Purchase Money Notes 

Guarantor and the Initial Member to cause such books to be audited by accountants selected by 

the Manager, the Purchase Money Notes Guarantor or the Initial Member, as applicable, and (d) 

allow the Manager, the Purchase Money Notes Guarantor and the Initial Member to discuss the 

Servicer's and Subservicer's affairs, finances and accounts, as they relate to the Assets, the 

Collateral, the Servicing Obligations, the Collection Account, the Escrow Accounts, the Working 

Capital Reserve Account, and any Other Accounts or any other matters relating to this 

Agreement, the other Transaction Documents or the rights or obligations hereunder and 

thereunder, with its officers, directors, employees, accountants (and by this provision the 

Servicer hereby authorizes such accountants to discuss such affairs, finances and accounts with 

such representatives), Subservicers, and attorneys. Any expense incurred by the Manager, 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 Purchase 

Money Notes Guarantor or the Initial Member of its rights in this Section 5.3 shall be borne by 

the Manager, the Purchase Money Notes Guarantor or the Initial Member, as applicable (and in 

all events subject to any obligation of the Manager to bear such expenses of 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 Purchase Money Notes 

Guarantor or the Initial Member of their 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 of the Assets, the Collateral, the Asset Documents or the Asset Proceeds, 

except, in the case of the Collateral, (x) as permitted under the Asset Documents where the 

applicable Borrower is not in default thereunder and (y) as permitted by the terms of 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 Assets, the Collateral and 

the Asset 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, any Required Consenting Party, or the Purchase Money Notes Guarantor, the Servicer 

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shall cause to be delivered to the Manager such information relating to the Assets, the 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 Subservicer becomes aware relating to the Assets, any of the Collateral, the 

Collection Account, the Escrow Accounts, the Working Capital Reserve Account, any accounts 

created under the Custodial and Paying Agency Agreement, any Other Accounts or any 

Borrower or Obligor that materially and adversely affects the interests of the Company, any 

Required Consenting Party or the Purchase Money Notes Guarantor. Without limiting the 

generality of the 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 Asset, (ii) any material notice from any 

Governmental Authority relating to any Collateral, (iii) any occurrence which could reasonably 

be expected to result in cost overruns with respect to any Asset or Acquired Property for which 

Funding Draws have been, or are contemplated to be, made, or (iv) 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 Collateral. Further, the Servicer shall cause to be furnished to the 

Manager, each month on the Specified Date, commencing the first month following the Effective 

Date and together with the Electronic Report, a report with respect to each Asset and Collateral 

(i) containing a summary of the progress made, to the extent applicable, in the construction, 

marketing and leasing of the applicable project since the last such report, (ii) in the case of any 

Asset, describing the remedial efforts or enforcement actions, if any, being undertaken by the 

Servicer with respect to the applicable Asset, (iii) describing the status of the activities 

contemplated by the Business Plans and the Consolidated Business Plan (which, among other 

things, identifies any facts or circumstances which are reasonably likely to hamper, interfere 

with, prevent or postpone effectuation of the applicable Business Plans or Consolidated Business 

Plan), (iv) to the extent applicable, containing an itemized statement of costs and expenses 

remaining to be paid in order to complete construction of the applicable project (including 

capitalized interest, real estate taxes and other soft costs), (v) to the extent requested by the 

Manager, any materials delivered by the Borrower to the Company or the Servicer pursuant to 

the applicable Asset 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 of the foregoing) and materials delivered by 

the applicable Borrower in connection with each request for an advance under the related Asset 

and (vi) such other information as the Manager reasonably requests. 

Section 5.6 Notice of Breach 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 of Control with respect to the Servicer. 

Section 5.7 Copies of Documents. Copies of the LLC Operating Agreement and the 

other Transaction Documents (or portions thereof) as 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. The 

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Manager may from time to time deliver to the Servicer such amendments, modifications or 

additional Transaction Documents (or portions of any thereof) as Manager may determine to be 

so necessary for the continued performance by Servicer of its obligations hereunder. All 

references herein to the Servicer's obligations with respect to such LLC Operating Agreement 

and other Transaction Documents shall, as between the Manager and the Servicer (and without 

limitation of obligations of the Manager, or the rights of the Initial Member or the Purchase 

Money Notes Guarantor, under this Agreement, the LLC Operating Agreement or the other 

Transaction Documents), be deemed to refer to the LLC Operating Agreement and other 

Transaction Documents (or portions thereof) as have been, or from time to time are, delivered to 

the Servicer. All obligations of the Servicer set forth in the LLC Operating Agreement and the 

other Transaction Documents are incorporated herein by reference and shall have the same force 

and effect as if the applicable provisions were set forth in this Agreement. 

Section 5.8 Financial Information. The Servicer shall submit to the Company, with 

copies thereof to be delivered by the Servicer to each Required Consenting Party, the Purchase 

Money Notes Guarantor 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 of its fiscal years, commencing on the Effective Date, a letter certified by an 

officer of the 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 or such Required Consenting Party 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 either (i) 

any action indicated on Schedule 3 attached hereto as requiring the consent of the Manager or (ii) 

any of the following actions, in any case, without the prior written consent of the Manager 

(which may require the Manager to obtain the written consent of each Required Consenting Party 

and/or the Purchase Money Notes Guarantor), which consent may be withheld or conditioned in 

the sole and absolute discretion of the 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 of fees to, the sale or other transfer (including through 

foreclosure or by deed in lieu thereof) of any Asset or Collateral or Acquired Property (or any 

portion thereof) to, or any other transaction with (whether or not at usual and customary rates), 

any Affiliate of the Company, the Manager, the Servicer, any Affiliate of the Servicer, any 

Subservicer, or any Affiliate of any Subservicer; 

(c) the financing of the sale or other transfer of any Assets, Collateral or 

Acquired Property (or any portion thereof); 

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(d) the sale of any Asset or 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 of 

the Asset 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 Working Capital Reserve Account, the accounts created under the Custodial and 

Paying Agency Agreement or any Other Accounts other than in accordance with the provisions 

of this Agreement, the LLC Operating Agreement, 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 Asset other than (i) Funding Draws, or (ii) Servicing Expenses to the extent that 

capitalizing such Servicing Expenses is or would have been, prior to the conversion of the Asset 

to Acquired Property, in each case as permitted under the applicable Asset Documents; 

(g) in connection with its servicing and administration of any Asset and 

management of the Collateral or Acquired Property, (i) approving (x) any material modification 

or amendment to, or cancellation or termination of, any Asset Documents, or (y) plans and 

specifications, construction budgets or construction schedules with respect to the projects which 

are the subject of such Asset (or material modifications to any of such items, including any 

change orders); (ii) waiving or forbearing from exercising any of the lender's rights under, or any 

conditions precedent to the funding of any advances under, such Asset; (iii) forgiving or 

reducing or forbearing from collecting any indebtedness; (iv) releasing any parties liable for the 

payment of the Asset or the performance of any other obligation relating thereto; (v) granting 

any consent under any Asset Documents (including, without limitation, with respect to any 

proposed transfers of any 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 Asset, any Borrower or any Obligor with respect to an Asset, or any Collateral, including 

voting for a plan of reorganization; (vii) subordinating the liens of the Loan Document; (viii) 

amending or waiving any provision of any intercreditor agreement or making any decisions with 

respect to the Assets under any intercreditor agreement; or (ix) taking any other action regarding 

such Asset, Collateral or Acquired Property that is prohibited under the LLC Operating 

Agreement or the other Transaction Documents or otherwise inconsistent with the Servicing 

Standard; or 

(h) reimbursement for any expense or cost incurred (or paid) to any Affiliate 

of the Company, any Affiliate of the Servicer or any Affiliate of any Subservicer. 

Section 6.2 Amendments, Modification and Waivers. No provision of this Agreement 

may be amended, modified or waived except in writing executed by the Manager and the 

Servicer, and each such amendment and modification shall be subject to the prior written consent 

of the 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 

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limit or affect the rights of the FDIC (as a third party beneficiary hereunder as specified in 

Section 11.8) without the express written consent of the 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 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 or (ii) the Custodial and Paying Agency Agreement or the 

LLC Operating Agreement; or 

(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 of its 

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 an Event of 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 of such 

Insolvency Event; or 

(c) any failure by the Servicer to duly pedant' its obligations in (i) Section 

5.2(e), which failure continues unremedied for a period of five (5) days, or such other period as 

the Manager and the Servicer agree, after the date on which written notice of such failure, 

requiring the same to be remedied, shall have been given by the Manager to the Servicer, or (ii) 

Section 5.2(f) or Section 5.2(g), which failure continues unremedied for a period of twenty-five 

(25) days, or such other period as the Manager and the Servicer agree, after the date on which 

written notice of such 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 be a Qualified Servicer and to 

renew and maintain any permit or license necessary to carry out its responsibilities under this 

Agreement in compliance with Law, (ii) to have an Acceptable Rating or otherwise be approved 

by the Initial Member or (iii) 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 either (i), (ii) or (iii), continues unremedied for a period of thirty (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 of its 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 .

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(f) any other failure (other than those specified in any of Section 7.1(a) 

through (e)) by the Servicer to duly observe or perform any other covenants or agreements on the 

part of the Servicer contained in this Agreement or to perfoim 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 of the 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 of the Initial Member, and the Servicer agree) with the exercise of reasonable diligence, 

the cure period shall be extended for an additional thirty (30) days if the Servicer can 

demonstrate to the reasonable satisfaction of the 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 of the 

Initial Member, then no such consent of the Initial Member shall be required with respect to an 

applicable cure period hereunder so long as 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 and 

the other Transaction Documents; or 

(g) [Reserved]; or 

(h) [Reserved]; or 

(i) [Reserved]; or 

(i) the occurrence of any Restricted Servicer Change of Control. 

Section 7.2 Termination with Cause. 

(a) Upon (i) the occurrence of a Default pursuant to this Agreement, in each 

case, without any cure period other than as may be provided for in Section 7.1 above (ii) the 

occurrence of any "Event of Default" as defined in the LLC Operating Agreement, (iii) the 

failure by the Servicer to perform its obligations in Section 11.9; provided, that in the event of 

such failure the Servicer is due to the failure of any Subservicer to comply with the provisions of 

Section 11.9, then it shall not be an Event of Default (but shall in all events be a default under the 

applicable Subservicing Agreement) so long as Servicer shall have replaced such Subservicer 

within thirty (30) days after the occcurence of such Subservicer's failure to comply with 

Servicer's obligations under Section 11.9, or (iv) receipt by the Manager or the Servicer of notice 

from the Purchase Money Notes Guarantor that an "Event of Default" as defined in the 

Reimbursement, Security and Guaranty Agreement has occurred and is continuing, 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 UCC) or equity, including injunctive relief, specific performance or 

otherwise, may (i) immediately terminate this Agreement by providing a Termination Notice to 

the Servicer, (ii) immediately terminate the Subservicing Agreements by providing a written 

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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 of the 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 of Default under 

the LLC Operating Agreement, the Initial Member (or any successor "Manager" to the Manager 

under the LLC Operating Agreement) may exercise all of the rights of the Manager under this 

Agreement and further cause the teunination or assignment of this 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 or an event described in clauses (ii), (iii) or (iv) of Section 7.2(a) 

hereof, each of the Manager (or applicable successor "Manager" to the Manager under the LLC 

Operating Agreement) and the Initial Member may exercise all of the rights of (A) the Manager 

under this Agreement and cause the termination or assignment of this 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 of the 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(a) and/or Section 7.1(b) of this 

Agreement. 

(d) Upon a default or failure of the Manager to perform its obligations under 

this Agreement in a material manner, including but not limited to, the failure of the 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 each Required 

Consenting Party and the Purchase Money Notes Guarantor. The Termination Notice shall set 

forth with specificity the nature of the default or failure to perfolin of the 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 the default or failure to perform is not cured within thirty (30) days after the date 

of delivery of the Termination Notice, the Servicer shall provide a second Termination Notice to 

the Manager with a copy to each Required Consenting Party and the Purchase Money Notes 

Guarantor, which second Termination Notice shall be prominently labeled as the "Second 

Termination Notice". Such Second Tetinination 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 of the Second Termination Notice to the 

Manager, the Purchase Money Notes Guarantor and each Required Consenting Party, and (ii) the 

transfer of the Servicing Obligations to a successor Servicer. The duty of the Servicer to 

continue to perform the Servicing Obligations as provided in the Second Termination Notice is 

contingent upon the timely and full payment of the Servicing Fee to the Servicer during such 

period. The Servicer shall cooperate fully and completely with the transition of the Servicing 

Obligations to a successor Servicer in order to assure an orderly transfer. 

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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 6 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 anniversary of the Effective 

Date and thereafter, without cause, terminate this Agreement. No termination of this Agreement 

by the Servicer shall be effective unless the Servicer delivers to the Manager, with a copy to each 

Required Consenting Party and the Purchase Money Notes Guarantor, a Termination Notice, 

which for the purpose of this Section 7.3(b) shall be a notice of the 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 of termination of the Servicer's Obligations under this 

Agreement. Notwithstanding the foregoing, such Termination Notice shall not be effective 

unless the Termination Notice contains confirmation of the intent and obligation of the 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 of the 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 Borrowers. 

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 of such 

termination, all authority and power of the Servicer under this Agreement, whether with respect 

to the Assets or otherwise, shall pass to and be vested in the Manager or the successor servicer 

designated by the Manager in the case of termination by the Manager or as designated solely by 

the Initial Member (or any successor "Manager" under the LLC Operating Agreement) in the 

case of termination 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 Operating Agreement and any successor servicer with 

respect to the timely and orderly transition of its obligations under this Agreement. The Servicer 

shall be liable for all obligations of the Servicer that have accrued under this Agreement or at 

Law prior to such telinination. 

Section 7.5 Accounting. Upon termination of this Agreement as set forth herein, the 

Servicer shall account 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 under the terms of this Agreement. 

The Servicer shall provide written notice in conformance with all applicable Law to the 

Borrowers to indicate that their Assets will henceforth be serviced by the Manager (or applicable 

successor "Manager" under the LLC Operating Agreement) or any applicable successor Servicer 

designated by the Manager (or any successor "Manager" under the LLC Operating Agreement) 

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or the Initial Member as the case may be, and transfer its duties as the Servicer to the Manager 

(or successor "Manager" under the LLC Operating Agreement) or such successor Servicer. 

ARTICLE VIII 

INDEPENDENCE OF PARTIES; INDEMNIFICATION 

Section 8.1 Independence of Parties. 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 Initial Member 

and each of their respective Affiliates, directors, officers, employees and agents and each of their 

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 of the Servicer's warranties 

or representations contained in this Agreement, (ii) any failure by the Servicer to observe or 

perform any or all of the 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 

Collateral relating to taxes, ground rents or other such recurring charges generally accepted by 

the mortgage servicing industry, which would become a Lien on the Collateral. The Servicer 

shall immediately notify the Indemnified Party if a claim is made in connection with the 

Servicer's responsibilities under this Agreement (including the Servicer's responsibilities in 

connection with the Assets and Collateral under this Agreement), assume (with prior consent of 

the 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 of such claim. No 

expenses incurred by the Servicer or any Subservicer in connection with its obligations under 

this Section 8.2 shall constitute Servicing Expenses or otherwise be deducted from or reimbursed 

out of Asset Proceeds. The Servicer shall follow any reasonable written instructions received 

from the Indemnified Party in connection with such claims, it being understood that the 

Indemnified Party shall have no duty to monitor or give instructions with respect to such claims. 

Section 8.3 Procedure for Indemnification. Promptly upon receipt of written notice of 

any claim in respect of which indemnity may be sought pursuant to the terms of this 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 of the 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 against 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 of the Indemnified Party, to vigorously defend or 

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pursue or attempt to settle such claim, the Manager shall have the right to assume the conduct, 

defense or settlement thereof, provided that the Manager shall obtain the prior written approval 

of the 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 Manager of its election to assume the defense, conduct or settlement thereof, the 

Servicer will not be liable to the Manager for any legal or other expenses consequently incurred 

by the Manager 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 of the 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 of the Initial Member, the FDIC, the Failed Banks and the 

Company that occurred or existed prior to the Effective Date or, with respect to any particular 

Asset, 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 of such claim or action in 

accordance with Article IX. Except as provided otherwise in Section 8.2 and 8.3 above (in the 

event that such claim or action is subject to the indemnification obligations of Servicer pursuant 

to Section 8.1 above), the Manager shall have the right to control and assume the defense of the 

Company, the Manager, the Servicer and the 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 terms set forth on Schedule 4, 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 of the provisions of this 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 

delivered to the applicable address or electronic mail address specified in, or in the manner 

provided, in this Article IX below. 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) if delivered by hand or by 

nationally recognized courier service, when signed for (or refused) by or on behalf of the 

relevant party hereto; (B) if delivered by mail, four (4) Business Days after deposit in the mails, 

postage prepaid; and (C) if delivered by electronic mail (which form of delivery is subject to the 

provisions of this paragraph), when delivered and capable of being accessed from the recipient's 

office computer, provided that any notice , request, demand or other communication that is 

received other than during regular business hours of the recipient shall be deemed to have been 

given at the opening of business on the next business day of the recipient. In no event shall a 

voice mail message be effective as a notice, communication or confirmation hereunder. From 

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EXECUTION VERSION 
time to time, any party may designate a new address for purposes of notice 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

Collateral Agent or the Purchase

Money Notes Guarantor:

Hudson Realty Capital LLC

250 Park Avenue South

Third Floor

New York, NY 10003

Attention: Renee Lewis

Email: 

Hudson Realty Capital LLC

250 Park Avenue South

Third Floor

New York, NY 10003

Attention: Andrew Bloom

E-mail:

with a copy to:

If to the Servicer:

with a copy to:

Assistant Director, Structured Transactions

c/o Federal Deposit Insurance Corporation

550 17th Street, NW (Room F-7014)

Washington, D.C. 20429-0002

Attention: Ralph Malami

Email: 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: DGearin@fdic.gov

Midland Loan Services, Inc.

10851 Mastin, 7th Floor

Overland Park, KS 66210

Attention: President

Email: 

Midland Loan Services, Inc.

10851 Mastin, 7th Floor

Overland Park, KS 66210

Attention: General Counsel

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Email:

ARTICLE X

GOVERNING LAW; JURISDICTION

Section 10.1 Governing Law. EACH PARTY TO THIS AGREEMENT AGREES

AND ELECTS THAT, IN ACCORDANCE WITH SECTION 5-1401 OF THE GENERAL

OBLIGATIONS LAW OF THE STATE OF NEW YORK, THIS AGREEMENT IS TO 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 JURISDICTION, AND EACH PARTY TO THIS

AGREEMENT UNCONDITIONALLY AND IRREVOCABLY WAIVES ANY CLAIM TO

ASSERT THAT THE LAWS OF ANY OTHER JURISDICTION GOVERN THIS

AGREEMENT. Nothing in this Agreement shall require any unlawful action or inaction by any

party hereto.

Section 10.2 Jurisdiction; Venue and Service. Each of the 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 of the State of New York, County of New York, or the U.S.

District Court for the Southern District of New York, as the party instituting such suit, 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 of such

courts for the purpose of any such suit, action or proceeding instituted against it by any other

party, and

(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 pursuant to Article IX

(with copies to such other Persons as specified therein); provided, however, that nothing

contained in this Section 10.2(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 10.2(a), (ii) waives any claim that any such suit, action or

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31
proceeding brought in any such court has been brought in an inconvenient forum and (iii) agrees 

not to plead or claim either of the foregoing; and 

(d) agrees that nothing contained in this Section 10.2 shall be binding upon or 

construed to constitute consent to jurisdiction by any 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 teints of the LLC Operating Agreement, the teniis of this Section 10.2 

shall be restated as follows: 

"The Servicer, on behalf of itself and its Affiliates, hereby irrevocably and 

unconditionally: 

(a) (i) consents to the jurisdiction of the United States District Court for 

the Southern District of New York and to the jurisdiction of the United States District Court for 

the District of Columbia for any suit, action or proceeding against it or any of its 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 of the FDIC; 

(B) assert that venue is improper in either the United States 

District Court for the Southern District of New 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 of New York or the United States District Court for the District of Columbia is an 

inconvenient forum; 

(ii) consents to the jurisdiction of the Supreme Court of the State of 

New York, County of New York, for any suit, action or proceeding against it or any of its 

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 of the FDIC; 

(B) assert that venue is improper in the Supreme Court of the 

State of New York, County of New York; or 

(C) assert that the Supreme Court of the State of New York, 

County of New 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 

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Agreement or any Ancillary Document in only either the United States District Court for the 

Southern District of New 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 of the FDIC, and agrees to consent thereafter to 

transfer of the suit, action or proceeding to either the United States District Court for the 

Southern District of New York or the United States District Court for the District of Columbia at 

the option of the FDIC; 

(iv) agrees, if the United States District Court for the Southern District 

of New 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 10.2(a)(iii), to bring that 

suit, action or proceeding in only the Supreme Court of the State of New York, County of New 

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 of the FDIC; and 

(v) agrees that any final judgment entered against it in any suit, action 

or proceeding falling within Section 10.2(a) may be enforced in any court of competent 

jurisdiction. 

(b) The Servicer, on behalf of itself and its Affiliates, hereby irrevocably and 

unconditionally agrees that any final judgment entered against it in any suit, action or proceeding 

falling within Section 10.2(a) may be enforced in any court of competent jurisdiction. 

(c) Subject to the provisions of Section 10.2(d), the Servicer, on behalf of 

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 10.2(a) 

or Section 10.2(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 

10.2(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 

WAIVES 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. 

33 SOUTH CRE VENTURE 2010-2 Structured Transaction 

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ARTICLE XI

 

MISCELLANEOUS 

Section 11.1 No Assignment by Servicer; No 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 of the following shall 

constitute an assignment for all purposes of this Agreement: (a) any merger, consolidation or 

dissolution involving the Servicer or (b) any transfer or all or substantially all of the assets of the 

Servicer, notwithstanding whether any of the foregoing transactions occur at one time or in the 

aggregate over a period of time. The Servicer shall not assign any rights or obligations 

hereunder to any other Person other than as is expressly provided in this Agreement; provided, 

however, that the Servicer may assign any and all of its rights and obligations hereunder to PNC 

Bank, National Association pursuant to its merger into or consolidation with PNC Bank, 

National Association within the twelve months following the date of this Agreement. In 

connection with the sale of an Asset, the Servicer shall, at the direction of the Manager, transfer, 

sell or assign its rights hereunder to service such Asset. Any purported sale, sub-participation or 

assignment or delegation in violation of this Section 11.1(a) shall be void ab initio and of no 

force or effect whatsoever. 

(b) Under no circumstances shall the Servicer (i) transfer to any Subservicer 

or any other Person any ownership interest in the servicing of the Assets or any right to transfer 

or sell the servicing to the Assets (other than in connection with the sale of any Asset), or (ii) 

assign, pledge or otherwise transfer or purport to assign, pledge or otherwise transfer any interest 

to any Subservicer or other Person in the servicing of the Assets (other than in connection with 

the sale of any Asset). Any purported assignment, pledge, delegation or other transfer in 

violation of this 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 of the legal fees or expenses incurred by the other party hereto in connection with the 

negotiation and execution of this 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 of which together 

shall constitute but one and the same agreement. This Agreement and any amendments hereto, 

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 

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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 of this 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 

applicable Laws, as they may pertain to such party's performance of its obligations hereunder. 

Section 11.7 Severability. Any provision of this Agreement which is prohibited or 

unenforceable in any jurisdiction shall be ineffective, but such ineffectiveness shall be limited as 

follows: (i) if such 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 of such 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 (ii), such ineffectiveness shall not invalidate any of the remaining provisions of this 

Agreement. Without limitation of the preceding sentence, it is the intent of the parties to this 

Agreement that in the event that in any court proceeding, such court determines that any 

provision of this Agreement is prohibited or unenforceable in any jurisdiction (because of the 

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 without limitation, 

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 

10.1. 

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 if the Initial Member were a party hereto. The Company, 

the Purchase Money Notes Guarantor, and the FDIC shall be and are hereby designated as third 

party beneficiaries under this Agreement with respect to those provisions of this Agreement 

which expressly grant rights to such Persons, and, as such, each is entitled to enforce such 

provisions of this Agreement as if such Person were a party hereto; provided, that, with respect 

to each Person (other than the Initial Member) that is a Required Consenting Party, at such time 

when such Person ceases to be a Required Consenting Party (and subject to any rights of such 

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EXECUTION VERSION 
Required Consenting Party that, by their tee is or nature, survive such date), such Person shall 

cease to have any of the specified rights set forth herein with respect to consents/approvals, the 

exercise of remedies following a Default or an event described in clauses (ii), (iii) or (iv) of 

Section 7.1(a) hereof and receipt of reports and other information with respect to the continued 

operation of the Business, in each case (i) to the extent relating exclusively to the period 

following such date on which such Person so ceases to be a Required Consenting Party, and (ii) 

with respect to the Purchase Money Notes Guarantor, except as to any rights or remedies relating 

to (or the exercise or non-exercise of which rights or remedies would affect) the Defeasance 

Account or the repayment of any Guaranteed Purchase Money Notes (in the case of the Purchase 

Money Notes Guarantor) in accordance with the terms hereof and of the other Transaction 

Documents, as determined by the Purchase Money Notes Guarantor, in its sole discretion. 

Notwithstanding the foregoing, none of the Purchase Money Notes Guarantor, the FDIC, the 

Company and the Initial Member shall have any obligation to undertake any of the duties of the 

Manager hereunder and 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. 

Section 11.9 Protection of Confidential Information. The Servicer shall keep 

confidential (and shall cause any Subservicer to keep confidential) and shall not divulge (and 

shall cause any Subservicer to not divulge) to any party, without the Manager's prior written 

consent, any information pertaining to the LLC Operating Agreement, the Assets or any 

Borrower or Obligor or the Collateral, except as required pursuant to this Agreement and except 

to the extent that it is necessary and appropriate for the Servicer or a Subservicer, as applicable, 

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 shall, and shall cause all Subservicers to, use all reasonable efforts 

to maintain confidentiality and shall (unless otherwise prohibited by law), and shall cause all 

Subservicers to (unless such Subservicers are otherwise prohibited by law), notify the Manager 

and the Initial Member 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, 

and/or the Purchase. Money Notes Guarantor may seek an appropriate protective order and/or 

direct the Manager to waive the Servicer's or Subservicer's, as the case may be, 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 and any applicable Subservicer may make such required 

disclosure if, in the written opinion of Servicer's outside counsel (which opinion shall be 

provided to the Manager, the Initial Member and the Purchase Money Notes Guarantor prior to 

disclosure pursuant to this Section 11.9), failure to make such disclosure would subject the 

Servicer or the Subservicer, as the case may be, to liability for contempt, censure or other legal 

penalty or liability. 

Section 11.10 Time of Essence. Time is hereby declared to be of the essence of this 

Agreement and of every part hereof. 

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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 

requested any term or condition of this 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 of Law or otherwise) to any setoff, offset, 

counterclaim or deduction (or to assert any claim for any setoff, offset counterclaim or 

deduction) against the Asset 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 of whatever 

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 of the Assets or 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 of such Prior 

Servicers. 

[Remainder of Page Intentionally Left Blank] 

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liability co yv

By:

Name:

Title: Authorized Signatory

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed

as of the day and year first above written.

MANAGER:

HRC SVC SOUTH 2010, LLC, a Delaware limited

SERVICER:

MIDLAND LOAN SERVICES, INC., a Delaware

corporation

By:

Name: Cynthia A. Bicknell

Title: Senior Vice President

I

[Signature Page to Servicing Agreement]

SOUTH CRE VENTURE 2010-2 Structured Transaction

Servicing Agreement

EXECUTION VERSION
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed

as of the day and year first above written.

MANAGER:

HRC SVC SOUTH 2010, LLC, a Delaware limited

liability company

By:

Name: 

Title:

SERVICER:

MIDLAND LOAN SERVICES, INC., a Delaware

corporation

By:

Name: C Chia A. Bicknell

Title: Senior Vice President

(Signature Page to Servicing Agi cement]

SOUTH CRE VENTURE 2010-2 Structured Transaction

Servicing Agreement

EXECUTION VERSION