EXECUTION COPY 


AMENDED AND RESTATED 


LIMITED LIABILITY COMPANY OPERATING AGREEMENT 


SFR VENTURE 2011-1, LLC 


Dated as of September 1, 2011 


SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
TABLE OF CONTENTS 


Article I Certain Definitions ............................................................................................................2 


1.1. Definitions.............................................................................................................2 


1.2. Construction..........................................................................................................2 


Article II Organization of the Company ..........................................................................................2 


2.1. Formation; Continuation and Admission of Members.........................................2 


2.2. Name.....................................................................................................................2 


2.3. Organizational Contributions and Related Actions ..............................................3 


2.4. Registered Office; Chief Executive Office ...........................................................3 


2.5. Purpose; Duration ................................................................................................ .3 


2.6. Special Purpose Entity; Limitations on Company's Activities .............................4 


2.7. Ratification of Certain Actions .............................................................................6 


Article III Management and Operations of the Company ...............................................................6 


3.1. Management ofthe Company's Affairs ................................................................6 


3.2. Removal ofManager .............................................................................................8 


3.3. Employees and Services .......................................................................................8 


3.4. Restrictions on Manager and Private Owner ........................................................9 


3.5. Related Party Agreements ................................................................................... IO 


3.6. Real Property ...................................................................................................... II 


3.7. Custodian and Paying Agent.. ............................................................................. II 


3.8. Relationships with Borrowers, etc ...................................................................... l2 


3.9. No Conflicting Obligations ................................................................................. l2 


3.10. Compliance with Law ......................................................................................... l2 


3.11. No Bankruptcy Filing .........................................................................................12 


3.12. No Liens .............................................................................................................. l2 


3.13. Remedies Upon an Event of Default; Security Interest. ..................................... 13 


3.14. Purchase Right of Initial Member ....................................................................... l9 


3.15. No ERISA Plan Assets ........................................................................................21 


Article IV Membership Interests; Rights and Duties of, and Restrictions on, Members ..............21 


4.1. General ................................................................................................................21 


4.2. LLC Interests ......................................................................................................22 


4.3. Filings; Duty of Members to Cooperate .............................................................22 


4.4. Certain Restrictions and Requirements ...............................................................23 


4.5. No Fiduciary Duties or Liability ofinitial Member ...........................................23 


4.6. Indemnification...................................................................................................24 


Article V Capital Contributions; Excess Working Capital Advance .............................................28 


5.I. Capital Contributions ..........................................................................................28 


5.2. Working Capital Reserve Account .....................................................................28 


5.3. [Reserved] ...........................................................................................................29 


5.4. [Reserved] ...........................................................................................................29 


5.5. Excess Working Capital Advances .....................................................................29 


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(Continued) 

Article VI Capital Accounts; Allocations; Priority of Payments; Distributions ............................29 


6.1. 	 Capital Accounts .................................................................................................29 


6.2. 	 Allocations to Capital Accounts ........................................................................ .30 


6.3. 	 Tax Allocations ...................................................................................................32 


6.4. 	 Determinations by Tax Matters Member ............................................................32 


6.5. 	 Priority of Payments ...........................................................................................33 


6.6. 	 Distributions........................................................................................................33 


Article VII Accounting, Reporting, Taxation, Business Plans and Verification ...........................34 


7.1. 	 Fiscal Year ..........................................................................................................34 


7.2. 	 Maintenance of Books and Records ...................................................................34 


7.3. 	 Financial Statements .......................................................................................... .34 


7.4. 	 Additional Reporting and Notice Requirements; Audits ................................... .34 


7.5. 	 Designation ofTax Matters Member ..................................................................35 


7.6. 	 Tax Information ..................................................................................................35 


7.7. 	 Business Plans .....................................................................................................36 


Article VIII Restrictions on Disposition of Private Owner Interest ..............................................39 


8.1. 	 Limitations on Disposition of Private Owner Interest ........................................39 


8.2. 	 Change ofControl .............................................................................................. .39 


8.3. 	 Additional Provisions Relating to Permitted Dispositions .................................39 


8.4. 	 Effect of Permitted Dispositions ........................................................................ .40 


8.5. 	 Effect of Prohibited Dispositions ........................................................................41 


8.6. 	 Distributions After Disposition ...........................................................................41 


8.7. 	 Transfers By Initial Member; Certain Consent Rights of the PMN 


Agent in Relation to the Initial Member .............................................................41 


8.8. 	 Resignation; Dissolution .....................................................................................42 


8.9. 	 Applicable Law Withdrawal ...............................................................................43 


Article IX Dissolution and Winding-Up of the Company .............................................................43 


9.1. 	 Dissolution ..........................................................................................................43 


9.2. 	 Winding-Up Procedures ..................................................................................... .44 


9.3. 	 Termination of the Company ..............................................................................45 


Article X Qualified Transferees .....................................................................................................45 


10.1. 	 Qualified Transferees ..........................................................................................45 


Article XI Manager Liability ........................................................................................................ .49 


11.1. 	 Liability ofManager. ......................................................................................... .49 


Article XII Servicing of Assets ..................................................................................................... .49 


12.1. 	 Servicing............................................................................................................ .49 


12.2. 	 Servicing Standard .. , ........................................................................................... 53 


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TABLE OF CONTENTS 

(Continued) 

12.3. Servicing of Assets......................................................... , ................................... 55 


12.4. Removal of Servicer. ..........................................................................................60 


12.5. Interim Management Fee and Interim Servicing Fee; Management Fee ............64 


12.6. Working Capital Expenses ..................................................................................65 


12.7. Use of Asset Proceeds .........................................................................................65 


12.8. Collection Account .............................................................................................66 


12.9. Distribution Account ...........................................................................................66 


12.10. [Reserved] ...........................................................................................................66 


12.11. Working Capital Reserve Account. ....................................................................66 


12.12. [Reserved] ...........................................................................................................67 


12.13. [Reserved] ...........................................................................................................67 


12.14. Other Uses of Company Funds ...........................................................................67 


12.15. Certain Servicing and Asset Administration Decisions ......................................67 


12.16. Management and Disposition of Collateral ........................................................68 


12.17. Acquisition of Collateral. ....................................................................................68 


12.18. Administration of Acquired REO Properties ......................................................69 


12.19. Releases of Collateral .........................................................................................71 


12.20. Clean-Up Call Rights .......................................................................................... 71 


12.21. Certain Transfer Obligations ...............................................................................72 


12.22. Seller Financing ..................................................................................................72 


Article XIII Miscellaneous ............................................................................................................73 


13.1. Waiver of Rights of Partition and Dissolution ....................................................73 


!3.2. Entire Agreement; Other Agreements ................................................................73 


13.3. Third Party Beneficiaries ....................................................................................74 


13.4. Expenses .............................................................................................................75 


13.5. Waivers and Amendments ..................................................................................75 


13.6. Notices ................................................................................................................76 


13.7. Counterparts; Facsimile Signatures ....................................................................78 


13.8. Successors and Assigns .......................................................................................78 


13.9. Compliance With Law; Severability ...................................................................78 


13.10. Power ofAttomey...............................................................................................79 


13.11. GovemingLaw ...................................................................................................79 


13.12. Jurisdiction; Venue and Service ..........................................................................80 


13.13. Waiver of Jury Trial ............................................................................................81 


Annex I Member Schedule .............................................................................................. I -I 


Annex II Reporting and Access Schedule ........................................................................II-1 


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TABLE OF CONTENTS 

(Continued) 

EXHIBIT A Certificate of Formation ................................................................................... A-1 


EXHIBITB Information, Form of Monthly Report .............................................................. B-1 


EXHIBIT C Form of Assignment and Assumption Agreement ........................................... C-1 


EXHIBIT D Form of Letter of Credit. .................................................................................. D-1 


IV 


SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
SFR VENTURE 2011-1, LLC 


AMENDED AND RESTATED 


LIMITED LIABILITY COMPANY OPERATING AGREEMENT 


THIS AMENDED AND REST A TED LIMITED LIABILITY COMPANY OPERATING 

AGREEMENT (as the same may be amended or modified from time to time in accordance with 

the terms hereof, this "Agreement"), is made and entered into as of the I st day of September, 

20 II, by and among the Federal Deposit Insurance Corporation in its capacity as the Receiver 

(the "Initial Member"), Mountain View Public Private Investment I, LLC, a Delaware limited 

liability company (the "Private Owner"), and SFR Venture 2011-1, LLC, a Delaware limited 

liability company (the "Company"). 

WHEREAS, on August 15, 2011, the Initial Member formed the Company as a Delaware 

limited liability company and was admitted as its initial, and sole, member (owning a I 00% 

limited liability company interest), and the Initial Member and the Company entered into the 

Original LLC Operating Agreement; 

WHEREAS, (i) pursuant to the Contribution Agreement, (x) the Initial Member has sold 

in part and (as the sole member of the Company at the time) contributed in part, in each case to 

the Company, and the Company purchased and accepted such contribution from the Initial 

Member, all of the Initial Member's right, title and interest in and to the Assets, and assumed the 

Obligations, and (y) the Company has executed and delivered to the Initial Member (as the sole 

member of the Company at such time) the Purchase Money Notes, and (iii) pursuant to the 

Reimbursement, Security and Guaranty Agreement, the Company has granted to the PMN 

Agent, for the benefit of the holders of the Purchase Money Notes and the other Secured Parties, 

a security interest in the Assets and Collateral; 

WHEREAS, following the execution of the Original LLC Operating Agreement and the 

closing of the transactions contemplated by the Contribution Agreement, the Initial Member 

agreed, pursuant to the terms of the Private Owner Interest Sale Agreement, to sell to the Private 

Owner, effective as of the Closing Date, an LLC Interest representing a 40% equity interest in 

the Company; 

WHEREAS, after giving effect to the transactions contemplated by the Private Owner 

Interest Sale Agreement, as of the Closing Date the Initial Member and the Private Owner will 

own all the issued and outstanding limited liability company interests in the Company; 

WHEREAS, the Manager has agreed to cause the Company to establish the Working 

Capital Reserve Account to provide the Company with capital to fund Working Capital Expenses 

and the Private Owner and the Initial Member have agreed to initially fund the Working Capital 

Reserve Account on a pro rata basis as described herein; and 

WHEREAS, the parties desire to amend and restate the Original LLC Operating 

Agreement in its entirety in order to reflect the admission of the Private Owner as a member of 

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Amended and Restated LLC Operating Agreement 
the Company and to set forth the terms and conditions on which the Company shall be owned 

and operated. 

NOW, THEREFORE, in consideration of the premises and the other covenants and 

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

sufficiency of which are hereby acknowledged, the parties hereto agree as follows: 

ARTICLE I 


Certain Definitions 


1.1. Definitions. This Agreement constitutes the "limited liability company 

agreement" (as such term is defined in the Act) of the Company. For purposes of this 

Agreement, all terms used in this Agreement (including in the preamble and recitals hereto) that 

are defined in, or by reference in, that certain Agreement of Definitions - SFR Venture 2011-1 

Structured Transaction dated as of the date hereof among the parties hereto and certain others, as 

the same may be amended from time to time in accordance with the terms set forth herein for the 

amendment of this Agreement (the "Agreement of Definitions"), and are not otherwise defined 

herein, shall have the respective meanings and definitions given, or referred to, in the Agreement 

of Definitions. 

1.2. Construction. The Rules of Construction apply to this Agreement. 

ARTICLE II 


Organization of the Company 


2.1. Formation; Continuation and Admission of Members. 

(a) On August 15, 2011, the Receiver caused the Certificate of Formation of 

the Company, in the form attached as Exhibit A hereto (the "Certificate"), to be filed in the 

office of the Secretary of State of the State of Delaware. The Certificate shall not be amended 

except to change the registered agent or office of the Company. 

(b) The Company shall continue as a limited liability company under the Act 

and in accordance with the further terms and provisions of this Agreement. 

(c) The Initial Member previously was, and the Private Owner hereby agrees 

to be, and is, admitted as a member of the Company such that, as of the Closing Date, the Initial 

Member and the Private Owner are the only members of the Company. Until the Company is 

dissolved pursuant to Section 9.1, and subject to the rights of the Initial Member under Section 

13.5(b) the Company shall at all times have two, and only two, members. 

2.2. Name. 

(a) The name ofthe Company shall be SFR Venture 2011-1, LLC. 

(b) The Business shall be conducted only under the name of the Company or 

such other name or names that comply with applicable Law as the Members may select from 

time to time. 

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SFR Venture 2011~1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
2.3. Organizational Contributions and Related Actions. 

(a) Prior to the execution of this Agreement, pursuant to, and as set forth in, 

the Contribution Agreement, the Initial Member: 

(i) made a Capital Contribution to the Company in the form of an 

undivided interest in each Asset (the "Initial Member Capital Contribution"); and 

(ii) sold and assigned a separate undivided interest in each Asset to the 

Company, and the Company purchased and accepted such assignment from the Initial Member, 

assumed the Obligations and issued the Purchase Money Notes to the Initial Member. 

(b) Contemporaneously with the execution of this Agreement, pursuant to the 

terms of the Private Owner Interest Sale Agreement, the Private Owner is acquiring from the 

Initial Member a 40% limited liability company interest in the Company for the Private Owner 

Interest Sale Price in accordance with the terms thereof. 

(c) Upon the consummation of the transactions contemplated in 

Sections 2.3(a) and® , the Private Owner shall own a 40% limited liability company interest in 

the Company and the Initial Member shall own a 60% limited liability company interest in the 

Company. 

2.4. Registered Office; Chief Executive Office. The Company shall maintain a 

registered office and registered agent in Delaware to the extent required by the Act, which office 

and agent shall be as determined by the Manager from time to time and which shall be set forth 

in the Certificate. Initially (and until otherwise determined by the Manager), the registered office 

in Delaware shall be, and the name and address of the Company's registered agent in Delaware 

shall be, as specified in the Certificate as originally filed, which may be amended by the 

Manager from time to time as necessary to correctly reflect the name and address of the 

Company's registered agent. The chief executive office of the Company shall be located at 999 

18'h Street, Suite 1001, Denver, CO 80202, or such other place as shall be determined by the 

Manager from time to time. 

2.5. Purpose; Duration. 

(a) The sole purpose of the Company is to engage in and conduct the 

Business, directly or, to the extent specifically authorized in this Agreement, indirectly through 

other Persons. The Company shall not form or have any Subsidiaries other than Ownership 

Entities or as otherwise authorized in this Agreement. The Company shall have all powers 

necessary, desirable or convenient, or which the Manager deems necessary, desirable or 

convenient, and may engage in any and all activities necessary, desirable or convenient, or which 

the Manager deems necessary, desirable or convenient, in each case to accomplish the purposes 

of the Company or consistent with the furtherance thereof. 

(b) Subject to Section 9.1, the Company shall continue in existence 

perpetual!y. 

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Amended and Restated LLC Operating Agreement 
2.6. Special Purpose Entity; Limitations on Company's Activities. Except to the 

extent expressly permitted by this Agreement or the other Transaction Documents, the following 

shall govern for so long as the Company is in existence: 

(a) Subject to Section 9.1, the Manager shall cause the Company to do or 

cause to be done all things necessary to preserve and keep in full force and effect its existence, 

rights (charter and statutory) and franchises, and the Manager also shall cause the Company to: 

(i) maintain financial statements separate from any Affiliate; 

provided, however, that each Ownership Entity shall be consolidated in the financial statements 

of the Company; and provided, further, that the assets, liabilities and results of operations of the 

Company may be included in the consolidated financial statements of its parent or ultimate 

parent in accordance with GAAP; 

(ii) at all times hold itself out to the public as a legal entity separate 

from the Members and any other Person; 

(iii) file its own Tax returns, as may be required under applicable Law, 

and pay any Taxes so required to be paid under applicable Law; 

(iv) pay its own liabilities only out of its own funds; 

(v) allocate, fairly and reasonably, shared expenses, including any 

overhead for shared office space; 

(vi) use separate stationery, invoices and checks; 

(vii) correct any known misunderstanding regarding its separate 

identity; 

(viii) maintain adequate capital m light of its contemplated business 

purpose, transactions and liabilities, if any; and 

(ix) at all time constitute a Special Purpose Entity. 

(b) Neither the Manager nor the Private Owner may cause or permit a 

Dissolution Event or an Insolvency Event to occur with respect to the Company or any of its 

Subsidiaries to which the Initial Member has not provided its written consent, and neither the 

Manager nor the Private Owner may, without the prior written consent of the Initial Member, 

cause or permit the Company or any of its Subsidiaries to: 

(i) except as contemplated hereby or by the other Transaction 

Documents, hold out its credit or assets as being available to satisfy the obligations of others, or 

become bound by any Guarantee of, or otherwise obligate itself with respect to, the Debts of any 

other Person, including any Affiliate; 

(ii) except as contemplated hereby or by the other Transaction 

Documents (including the Purchase Money Notes and the Reimbursement, Security and 

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SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
Guaranty Agreement), pledge its assets for the benefit of any other Person, make any loans or 

advances to any other Person, or encumber or permit any Lien (other than Permitted Liens) to be 

placed on the Assets, the Collateral, or the proceeds therefrom, provided that, the Company may 

(x) invest its funds in interest bearing accounts held by any banlc that is not its Affiliate and 

otherwise in accordance with the terms of this Agreement and the Custodial and Paying Agency 

Agreement and (y) make advances in accordance with Article XII; 

(iii) own any assets, or engage in any business, umelated to the 

Business; 

(iv) incur, create or assume any Debt other than the Purchase Money 

Notes (including any promissory note issued pursuant to Section 2.8 of the Custodial and Paying 

Agency Agreement or Section 8.4(c) of the Contribution Agreement), any Excess Working 

Capital Advance or as otherwise expressly permitted hereby or by the other Transaction 

Documents to which the Initial Member is a party; 

(v) make or permit to remain outstanding any loan or advance to, or 

own or acquire any stock or securities of, any Person (other than an Ownership Entity), except 

that the Company may invest in those investments permitted under the Transaction Documents 

and may make any advance required or expressly permitted to be made pursuant to any 

provisions of Article XII or the other Transaction Documents and permit the same to remain 

outstanding in accordance with such provisions; 

(vi) acquire any LLC Interest (or any portion of any LLC Interest); 

(vii) consolidate or merge with or into any other Person, convert into 

any other type of Person (including into a limited liability company organized under the Laws of 

a jurisdiction other than the State of Delaware), transfer, domesticate or continue the Company 

or any Subsidiary of the Company pursuant to Section 18-213 of the Act, or take any other action 

for which the consent of some or all of the members of a limited liability company is (unless 

otherwise provided in the limited liability company agreement of such limited liability company) 

required by the Act; 

(viii) convey or transfer its properties and assets as an entirety or 

substantially as an entirety to any Person, transfer its ownership interests, or engage in any 

dissolution or liquidation, except in each case to the extent such activities are expressly permitted 

pursuant to any provision of this Agreement or the other Transaction Documents (and subject to 

obtaining any approvals required hereunder or thereunder, as applicable); 

(ix) except as contemplated or permitted by this Agreement, form, 

acquire or hold any Subsidiary other than an Ownership Entity or form any trust for the purpose 

of holding Assets for the benefit ofthe Company; 

(x) enter into any Modification of, or breach or violate any 

representation, warranty, covenant or agreement contained in, any Transaction Document; or 

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SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
(xi) take or fail to take any other action under the other Transaction 

Documents requiring written consent of the Initial Member without obtaining such written 

consent. 

(c) The failure of the Company, any Member and/or the Manager to comply 

with any ofthe foregoing covenants or any other covenants contained in this Agreement shall not 

affect the status of the Company as a separate legal entity or the limited liability ofthe Members. 

2.7. Ratification of Certain Actions. Prior to the Closing Date, the Company 

previously approved (i) each of the Transaction Documents, (ii) the issuance of the LLC 

Interests, and (iii) the taking of all action reasonably necessary to effect the foregoing approvals, 

including the execution and performance of this Agreement and the other Transaction 

Documents (the "Previously Approved Matters"). The Previously Approved Matters, and all 

actions taken by the Company in furtherance of the Previously Approved Matters, are hereby 

ratified, approved and confirmed in their entirety by each Member and the Manager is hereby 

authorized and directed to execute and deliver, for and on behalf of the Company, any and all 

documents as may now or hereafter be reasonably required in order to effect the Previously 

Approved Matters. 

ARTICLE III 


Management and Operations of the Company 


3.1. Management of the Company's Affairs. 

(a) Subject to the terms and conditions of this Agreement, the management of 

the Company shall be vested exclusively in the Person appointed from time to time hereunder as 

the "Manager" of the Company (the "Manager"), which Manager may be, but is not required to 

be, a Member. Effective as of the Closing Date, the Private Owner is hereby appointed as the 

Manager. Subject to the terms and conditions ofthis Agreement, the Manager shall have full and 

exclusive power and discretion to, and shall, manage the business and affairs of the Company in 

accordance with this Agreement. The Private Owner may not resign as the Manager, may not 

Dispose of or delegate, in whole or in part, its rights, responsibilities or duties as the Manager to 

any other Person, and shall serve as Manager until such time as (i) the Private Owner Interest is 

Disposed of in accordance with the terms of this Agreement and the transferee is admitted as a 

member of the Company and Successor to the Private Owner, in which case the transferee 

Member shall, effective upon such Disposition, be appointed as the "Manager" to the extent the 

Private Owner held such role immediately prior to such Disposition, (ii) the Private Owner is 

removed as Manager by the Initial Member or the PMN Agent and replaced in accordance with 

Sections 3.2 or 12.4 below, or (iii) the Company is dissolved, and the business and affairs of the 

Company are wound up, in accordance with the terms of this Agreement. The Manager shall 

devote such time to the affairs of the Company as is necessary to manage the Company as set 

forth in this Agreement. Without limitation of the foregoing, the Manager shall cooperate with 

the Tax Matters Member in all respects as reasonably requested by the Tax Matters Member, 

from time to time, in connection with the Tax Matters Member's performance of its obligations 

under this Agreement. The Private Owner hereby expressly acknowledges that (x) as it relates to 

its role as the Manager, this Agreement constitutes a personal services contract between the 

Private Owner and the Company, and (y) except as may otherwise be expressly specified herein, 

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Amended and Restated LLC Operating Agreement 
it shall not be entitled to any salary, fees, reimbursement of costs or expenses, or other 

compensation with respect to its service as the Manager hereunder (including with respect to the 

Manager's Servicing obligations under Article XII). 

(b) Except as otherwise specifically provided in this Agreement and without 

limitation of the authority, duties (including fiduciary duties) and functions of the Manager 

expressly specified under any other provision of this Agreement, the authority, duties (including 

fiduciary duties) and functions of the Manager shall be identical to the authority, duties 

(including fiduciary duties) and functions of the board of directors and the officers of a 

corporation organized under the Delaware General Corporation Law (and not electing to be 

governed by subchapter XIV thereof). The Manager shall have no authority to take or authorize 

the taking of any action in contravention of any express term of this Agreement. 

(c) No Person dealing with the Company or the Manager shall be required to 

determine, and any such Person may conclusively assume and rely upon, the authority of the 

Manager to execute any instrument or make any undertaking on behalf of the Company. No 

Person dealing with the Company or the Manager shall be required to determine any facts or 

circumstances bearing upon the existence of such authority. Without limitation of the foregoing, 

any Person dealing with the Company or the Manager is entitled to rely upon a certificate signed 

by the Manager as to: 

(i) the identity of the Members; 

(ii) the existence or non-existence of any fact or facts that constitute a 

condition precedent to acts by the Manager or are in any other manner germane to the affairs of 

the Company; 

(iii) the identity of Persons who are authorized to execute and deliver 

any instrument or document of or on behalf of the Company; or 

(iv) any act or failure to act by the Company or any other matter 

whatsoever involving the Company or the Members. 

(d) Notwithstanding anything to the contrary contained in this Agreement, the 

parties hereto aclmowledge and agree that: 

(i) nothing contained in this Agreement creates any fiduciary duty or 

similar obligation owed by or on behalf of the Initial Member; 

(ii) each of the Private Owner and the Company hereby expressly 

waives any fiduciary duties that may otherwise be deemed to be owed by the Initial Member to 

the Private Owner or the Company; and 

(iii) the Initial Member shall be entitled to act and exercise any right of 

approval or consent that it has under this Agreement in its interest, in its sole and absolute 

discretion, without regard to and against the interests of the Private Owner or the Company. 

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(e) Unless and to the extent reimbursement is due under an express provision 

hereof or of another Transaction Document or pursuant to a Related Party Agreement permitted 

pursuant to Section 3.5, the Company shall not be liable for, and the Manager, the Private Owner 

and their respective Affiliates shall not seek reimbursement from the Company or any Member 

(other than, as to any such Member that is an Affiliate of the Person so seeking reimbursement, 

as may separately be agreed by such Member, without recourse to or reimbursement from the 

Company) for, any expenses or costs incurred after the formation of the Company by the 

Manager, the Private Owner and/or their Affiliates on behalf of or for the benefit of the 

Company. 

(f) This Section 3.1 is subject to any express requirement of direct Initial 

Member consent set forth elsewhere in this Agreement, including in Sections 2.6, 3.4, 3.8, JlL 

8.2, 8.8(a), 2J., 12.1, l2.7(b), 12.14, 12.15, 12.!8, !3.5 and !3.12. Any purported action by the 

Company or the Manager requiring the consent of the Initial Member under this Agreement shall 

be null and void ab initio unless and until the Initial Member's prior written consent is obtained. 

3.2. Removal of Manager. Upon an Event of Default (and so long as the Private 

Owner is then the Manager), any Required Consenting Party may remove the Private Owner as 

the Manager and appoint a successor Manager in the sole discretion of such Required Consenting 

Party in accordance with Section 12.4, whereupon such successor Manager shall immediately 

succeed to all, or such portion as the Required Consenting Parties and successor Manager agree, 

of the rights, powers, duties and obligations of the "Manager" hereunder, and the predecessor 

Manager shall promptly take such actions as may be reasonably requested by any Required 

Consenting Party to facilitate the transition to such successor Manager. In the event of any 

conflict between any instructions (or any determinations) of the Initial Member and the PMN 

Agent (while it is a Required Consenting Party) in connection with any such removal or 

replacement, the instructions and determinations of the PMN Agent shall prevail. 

3.3. Employees and Services. After the Closing Date, the Manager shall cause to be 

made available to the Company, from time to time, employees, facilities and support services in 

a manner and to an extent reasonably required for it to fulfill its duties and obligations as the 

Manager and for the day-to-day operation of the Business. If necessary to meet the foregoing 

requirements, the Manager shall enter into contractual arrangements to secure employees, 

facilities and support services from third parties (including its Affiliates); provided, however, 

that the Manager shall at all times provide for the Servicing (other than Asset Management 

retained by the Manager in accordance with Section 12.3(b)) to be conducted through the 

Servicer under contract with the Manager (in its individual capacity) in accordance with Article 

XII and the safekeeping of the Notes and other Asset Documents by a Custodian under contract 

with the Company in accordance with the provisions of Section 3.7 below. Notwithstanding 

anything to the contrary contained in this Section 3.3, (i) the Company shall not have any 

employees, (ii) no employees of the Manager or any third party (including any Affiliate of the 

Manager) shall be deemed to be employees of the Company, (iii) any contractual relationships 

entered into by the Manager to provide employees, facilities or support services to the Company 

shall be relationships between the third parties (or Affiliates and the Manager) and the Manager 

(and not the Company) and shall not relieve the Manager of its obligations or any liability 

hereunder, and (iv) no expenses incurred to secure or maintain employees (or independent 

contractors performing relevant services for the day-to-day operation of the Company in lieu of 

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SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
performance of the same by such employees), facilities or support services shall be an expense of 

the Company unless the same is expressly reimbursable by the Company pursuant to the 

provisions of Article XII below or is otherwise expressly set forth in this Agreement or in any 

other Transaction Documents to be an expense of the Company. 

3.4. Restrictions on Manager and Private Owner. Neither the Private Owner nor, 

notwithstanding any delegation of authority to it hereunder, the Manager may or shall in any 

event (x) do, or cause the Company to do, any act or take, or cause the Company to take, any 

action in contravention of any Law, or (y) take any of the following actions on behalf of, or with 

respect to, the Company, or otherwise cause the Company to take any of the following actions, in 

the case of all of the foregoing without the prior written approval of the Required Consenting 

Parties, which approval may be withheld or conditioned in the sole and absolute discretion of 

each such Required Consenting Party: 

(a) admitting additional or substitute members of the Company, except in 

accordance with Article VIII; 

(b) changing the legal form of the Company to other than a limited liability 

company; 

(c) taking any action that would cause the Company to be treated as other 

than a partnership for federal tax purposes; 

(d) taking any action that would make it impossible to carry on the ordinary 

Business of the Company; 

(e) during any of the first three successive twelve-month periods after the 

Closing Date, conducting Bulk Sales in an aggregate amount (for such twelve-month period) in 

excess of 10% of the aggregate Unpaid Principal Balance of all Assets as of the beginning of 

such twelve-month period (or, for such first twelve-month period, as at the Cut-Off Date as 

indicated on the Asset Schedule), it being understood that for purposes of the foregoing the sale 

or other disposition of an Ownership Entity (or any voting or equity interest therein) shall 

constitute a sale or other disposition of the Acquired Property (including any Acquired REO 

Property) held directly or indirectly by such Ownership Entity; 

(f) incurring any liability on behalf of the Company (other than liabilities to 

trade creditors in the ordinary course of the Business and such other liabilities as may be 

permitted by this Agreement or any other Transaction Document); 

(g) possessing or transferring Company Property for other than Company 

purposes; 

(h) taking any action that would require (or refusing to take any action where 

the result of such refusal would so require) the Company to register as an "investment company" 

(as defined in the Investment Company Act); 

9 

SFR Venture 2011~1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
(i) selling or otherwise transferring any Asset, Collateral or Acquired 

Property (or any portion thereof) to the Manager, the Private Owner, the Servicer, any 

Subservicer, or any Affiliate of any of the foregoing or of the Company; 

G) except as expressly permitted pursuant to Section 12.22, financing the sale 

or other transfer of any Asset, Collateral or Acquired Property (or any portion thereof); 

(k) selling any Asset, Collateral or Acquired Property (or any portion thereof) 

in a transaction that provides for any recourse against the Company, the Initial Member or the 

FDIC, in any capacity, or against the LLC Interest held by the Initial Member or any share of the 

Asset Proceeds allocable to the Initial Member, other than contractual obligations solely of the 

Company with respect to customary post-closing purchase price adjustments and prorations; 

(I) disbursing, or causing the disbursement of, funds from the Collection 

Account, the Distribution Account, the Working Capital Reserve Account or other accounts 

created under this Agreement, the Custodial and Paying Agency Agreement or any Servicing 

Agreement other than in accordance with (and without violation of any requirement contained 

in) the provisions of this Agreement, the Custodial and Paying Agency Agreement, the 

Reimbursement, Security and Guaranty Agreement and the applicable Servicing Agreement; 

(m) advancing additional funds that would increase the Unpaid Principal 

Balance of any Asset other than (i) Required Funding Draws or (ii) Servicing Expenses to the 

extent that capitalizing such Servicing Expenses is permitted (or with respect to Acquired 

Property would have been permitted prior to the conversion of the Loan to Acquired Property) 

under the applicable Asset Documents; 

(n) reimbursing the Manager for any expense or cost incurred by (or paid by) 

any Affiliate of any of the Company, the Private Owner or the Manager, the Servicer or any 

Subservicer (provided that this clause (n) does not prohibit reimbursing the Manager for 

Servicing Expenses or Pre-Approved Charges solely as a result of the Manager being an Affiliate 

of the Company, the Servicer or any Subservicer); 

(o) taking any action or omitting to take any action that causes the Company 

to breach any representation, warranty, covenant or other agreement contained herein or in any 

other Transaction Document (for avoidance of doubt, nothing in this clause (o) shall require the 

Private Owner or the Manager to make any capital contribution or advances which are not 

otherwise required of it under the express terms of this Agreement or any other Transaction 

Document); or 

(p) taking any action for which the consent of some or all of the members of a 

limited liability company is (unless otherwise provided in the limited liability company 

agreement of such limited liability company) required by the Act. 

3.5. Related Party Agreements. Neither the Company nor any of its Subsidiaries shall 

enter into any Related Party Agreement, except as may otherwise be expressly provided herein 

or in any other Transaction Document to which the Initial Member is a party or as may be 

approved by both Members. 

10 

S:FR Venture 2011-t Structured Transaction 

Amended and Restated LLC Operating Agreement 
3.6. Real Property. The Company shall not take title in its own name to any Acquired 

REO Property, and any acquisition or ownership of any such Acquired REO Property shall be 

subject to Sections 12.17 and 12.18 and the relevant terms ofthe Servicing Agreement. 

3.7. Custodian and Paying Agent. The Manager shall cause the Company to retain 

and enter into and, at all times, be a party to a written custodial agreement with a Custodian (as 

selected by the Company in accordance herewith), and such Custodian shall at all times have 

custody and possession of the Notes and other Custodial Documents (subject to the applicable 

provisions herein and in such custodial agreement with respect to the release thereof). The 

Manager shall also cause the Company to retain and enter into and, at all times, be a party to a 

written paying agency agreement with a Paying Agent (as selected by the Company in 

accordance herewith), which Paying Agent shall receive and distribute Asset Proceeds in 

accordance with such paying agency agreement. Such Custodian and Paying Agent shall be (and 

remain) a Qualified Custodian and Paying Agent acceptable to and approved by the Initial 

Member and the PMN Agent, such approval not to be unreasonably withheld, delayed or 

conditioned. Except as may be determined by the Initial Member in connection with an exercise 

of its rights under Section 13.5 below, the Custodian and the Paying Agent shall be a single (and 

the same) Person; and the custodial and paying agency functions shall be performed on the terms 

set forth in the Custodial and Paying Agency Agreement (which shall be in a form acceptable to 

the Initial Member). At no time shall the Company have more than one Custpdian or one Paying 

Agent, who may be (and, to the extent specified in the preceding sentence, shall be) the same 

Person. The fees and expenses paid to the Custodian and Paying Agent shall be no more than 

market rates and the Custodian and Paying Agent may be terminated by the Company (with the 

consent of the PMN Agent) or the PMN Agent upon no more than thirty days notice provided to 

it, without cause under the Custodial and Paying Agency Agreement. For purposes of 

clarification, the parties acknowledge that, as of the Closing Date, the Custodial and Paying 

Agency Agreement delivered on the Closing Date is acceptable to the Initial Member, including 

as to the fees and expenses expressly set forth therein. In the event that the Manager removes, or 

causes the Company (or the Servicer or any Subservicer) to remove, any Notes or other 

Custodial Documents from the possession of the Custodian (which shall be done only in 

accordance with the relevant Custodial and Paying Agency Agreement), (i) any loss or 

destruction of or damage to such Notes or Custodial Documents shall be the personal liability of 

the Manager (who, along with the relevant Servicer or Subservicer(s), shall be responsible for 

safeguarding such Notes and Custodial Documents when not in possession of the Custodian), 

and (ii) such Notes shall be returned to the Custodian within the time provided under the 

applicable Uniform Commercial Code to maintain the perfection of the secured party's security 

interest therein by possession. If any Notes or other Custodial Documents are removed in 

connection with the modification, restructuring or foreclosure of a Loan, the modified or 

restructured Notes and other Custodial Documents removed in connection therewith shall be 

returned to the Custodian as soon as possible following the completion of the restructuring, 

modification or foreclosure (and, in any event, in accordance with clause Cii) of the immediately 

preceding sentence). Notwithstanding the foregoing, if any Notes or other Custodial Documents 

are retained by the applicable court, the Manager shall request that the court return such items, 

and such Notes and other Custodial Documents shall be returned to the Custodian as soon as 

possible after they are released by such court. The Manager shall (i) ensure that the Initial 

Member receives a copy of each demand, notice or other communication given by the Manager 

(including by the Manager on behalf of the Company) under the Custodial and Paying Agency 

II 

SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
Agreement at the time that such notice or other communication is given thereunder and (ii) 

require that a copy of each demand, notice or other communication given to the Manager 

(including to the Manager as the manager of the Company) under the Custodial and Paying 

Agency Agreement is to be given to the Initial Member at the time that such notice or other 

communication is given thereunder. 

3.8. Relationships with Borrowers. etc. Except as otherwise consented to by the Initial 

Member, none of the Private Owner, the Manager or any Affiliate of either shall, at any time, 

(i) be an Affiliate of or 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 Manager or 

the Company, or (iii) except as is otherwise contemplated by the Company's ownership of the 

Assets and its right to hold Acquired Property, have any interest whatsoever in any Borrower, 

Obligor or other obligor with respect to any Asset or any of the Collateral. 

3.9. No Conflicting Obligations. The Manager shall cause the Company to comply 

with the Transaction Documents in accordance with their terms, and shall not, at any time, enter 

into or become a party to any agreement that would conflict with the terms of this Agreement. 

3.10. Compliance with Law. The Manager shall, and shall cause the Company to, at all 

times, (i) comply with applicable Law in connection with the performance or exercise of its 

rights, powers, duties or obligations under this Agreement, and (ii) without limiting the 

generality of clause (i) and subject to Section 4.3, be duly authorized and qualified to transact 

any and all business to be conducted by it in any state in which an Asset is located and comply 

with the doing business Laws of any such state, in each case described in this clause (ii) to the 

extent necessary to ensure its ability to manage the Assets in accordance with the terms of this 

Agreement and to perform any of its other obligations under this Agreement in accordance with 

the terms hereof. 

3.11. No Bankruotcv Filing. Neither the Manager nor the Private Owner may cause or 

permit the Company to: (i) file a voluntary petition for bankruptcy, (ii) file a petition or answer 

seeking any reorganization, arrangement, composition, readjustment, liquidation, dissolution, 

receivership or similar relief under any Law, (iii) make an assignment for the benefit of creditors, 

(iv) seek, consent or acquiesce in the appointment of a trustee, receiver or liquidator of all or any 

substantial part of its properties, (v) file an answer or other pleading admitting or failing to 

contest the material allegations of (x) a petition filed against it in any proceeding described in 

clauses (i) through (iv), or (y) any order adjudging it bankrupt or insolvent or for relief against it 

in any bankruptcy or Insolvency Proceeding, (vi) allow itself to become unable to pay its 

obligations as they become due, or (vii) institute any proceedings to set aside or void any transfer 

of an interest in property (or to recover the value thereof) or other transaction on the grounds that 

such transfer or other transaction constituted a fraudulent conveyance or a preferential transfer 

(or on similar grounds). 

3.12. No Liens. The Manager shall not (i) cause the Company to place or (ii) permit 

(voluntarily or involuntarily) to be placed, or to exist, any Lien on any of the Assets, the 

Collateral, the Asset Documents, or the Asset Proceeds, except for Permitted Liens; and the 

Manager shall not take any action to interfere with the PMN Agent's rights as a secured party 

with respect to Assets, the Collateral and the Asset Proceeds. 

12 

SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
3 .13. Remedies Upon an Event of Default; Security Interest. 

(a) Upon the occurrence of an Event of Default, in addition to all other 

remedies available hereunder or under the other Transaction Documents upon such an Event of 

Default, the Initial Member shall be entitled to: 

(i) remove the Private Owner as the Manager or Servicer pursuant to 

Sections 3.2 and 12.4; 

(ii) remove the Private Owner as a Member; 

(iii) purchase (or cause a designee to purchase) the Private Owner 

Interest pursuant to Section 3.14; 

(iv) designate itself or any applicable transferee Member as the 

Manager hereunder; and/or 

(v) with or without notice to or demand upon the Private Owner 

(except as may be required by Law), exercise any or all rights and remedies with respect to the 

Secured Assets and any Qualifying Letter of Credit, specifically including the right (A) to 

foreclose on the Private Owner Interest and transfer such Private Owner Interest to a third party 

(it being agreed that none of the Private Owner, the Manager or any of their Affiliates shall 

participate in any sale of the Private Owner Interest without the written consent of the Initial 

Member), (B) to draw upon any QualifYing Letter of Credit, by presenting to the applicable 

Issuing Bank one or more drafts or demands and any other necessary documents, and to receive 

(in a lump sum or in several sums from time to time at the sole discretion of the Initial Member) 

any or all amounts available for drawing under such Qualifying Letter of Credit, and/or (C) to 

exercise any rights under the Private Owner Pledged Account Control Agreement (or otherwise) 

with respect to the Private Owner Pledged Account, including the right to assume exclusive 

control over the Private Owner Pledged Account and to cause the funds therein to be remitted (in 

a lump sum or in several sums from time to time at the sole discretion of the Initial Member) to 

or at the direction of the Initial Member. The Initial Member shall have the right to apply any or 

all proceeds of the Secured Assets or any Qualifying Letter of Credit to payment of the Private 

Owner Obligations in such order, and with such priority as among any such Private Owner 

Obligations, as the Initial Member may determined in its sole discretion. 

The removal ofthe Private Owner as a Member shall be subject to Section 8.4. 

(b) For the avoidance of doubt, in the event that the Initial Member 

determines to exercise its remedies against any Secured Assets or any QualifYing Letter of 

Credit, it shall have the absolute right to deduct from the proceeds of such exercise of remedies 

(including proceeds of any foreclosure sale with respect to the Private Owner Interest, any 

drawing on a Qualifying Letter of Credit and any receipt of funds from the Private Owner 

Pledged Account), (i) any Losses arising out of or resulting from such Event of Default incurred 

by the Indemnified Parties, together with all costs and expenses (including attorneys' fees and 

disbursements) incurred by the Initial Member in connection with enforcing its rights and 

remedies hereunder and under the other Transaction Documents, and (ii) any Private Owner 

13 

SFRVenture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
Obligations then due and payable (all of the foregoing in each case in such order as the Initial 

Member may determine in its sole discretion), provided that the Initial Member may, in its sole 

discretion, hold any such proceeds as additional security for any existing or future (including 

contingent) Private Owner Obligations. Without limitation of the foregoing, in no event shall the 

Initial Member have any obligation (but it shall at all times have the right in its sole discretion) to 

use or apply any proceeds of the Secured Assets toward payment of any Private Owner 

Obligations owing to the Company or any Indenmified Party other than the Initial Member 

(whether or not the same are due and payable), and the Private Owner shall remain fully 

obligated to pay and perform all such Private Owner Obligations owing to the Company and 

each such Indemnified Party notwithstanding any such election by the Initial Member to so 

refrain from applying such proceeds toward payment of the same; and, in the event that, for any 

reasons any such proceeds of the Secured Assets are used for payment of any Private Owner 

Obligations owing to the Company, any and all rights of the Private Owner to payments, 

reimbursements or distributions from the Company on account of any such payment to the 

Company (including rights to any repayment of any deemed Excess Working Capital Advances, 

to the extent any such proceeds are used to fund the same), shall be considered as part of the 

Secured Assets and shall, to the extent paid or payable by the Company, be paid directly to the 

Initial Member (and the Initial Member shall have the right to direct the Paying Agent to so remit 

to the Initial Member any applicable distributions or payments by the Paying Agent with respect 

thereto) to be held and applied by the Initial Member as part of the proceeds of the Secured 

Assets (as collateral for the Private Owner Obligations). Any Secured Assets or proceeds thereof 

as held by the Initial Member may be commingled with the Initial Member's own funds, without 

any need to pay interest or income thereon. Upon indefeasible payment and performance in full 

of all of the Private Owner Obligations (following the dissolution of the Company), any 

remaining unapplied proceeds (from an exercise of remedies by the Initial Member against the 

rights of the Private Owner to the Secured Assets or any Qualifying Letter of Credit) so held by 

the Initial Member, shall be released to the Private Owner (or such other Person as may have 

applicable rights therein in accordance with applicable Law). In any event, the Private Owner 

shall remain liable for any deficiency in payment of the Private Owner Obligations. 

(c) This Agreement shall constitute a security agreement under applicable 

Law for the benefit of the Initial Member and, in furtherance thereof, the Private Owner (in all of 

its capacities) and the Company (as applicable) shall be deemed to have granted, and each does 

hereby grant, to the Initial Member, for itself(and its assignees) and for the further benefit of the 

Indemnified Parties, a valid and continuing first priority Lien on and security interest in all of the 

Private Owner's right, title and interest, whether now owned or existing, or hereafter acquired or 

arising, in, to or under the Secured Assets, as security for the payment and performance (when 

due) by the Private Owner (including in its roles as the Manager and the Tax Matters Member) 

of the Private Owner Obligations. For the avoidance of doubt, the parties acknowledge that the 

Secured Assets are not, pursuant to the foregoing, collateral for the separate payment obligations 

of the Company except to the extent that, pursuant to this Agreement or the other Transaction 

Documents, the Private Owner, in any capacity, is required to pay (or advance applicable funds 

to pay) or otherwise bear such obligations (and in such case, such Secured Assets secure such 

separate obligations of the Private Owner), such that the Secured Assets do not secure the 

Company's payment obligations under the Purchase Money Notes. The Private Owner 

represents, warrants and covenants that it owns, and shall at all times own, the Secured Assets 

14 

SFR Venture 2011R1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
free and clear of any Liens (other than the Lien created hereby), and, upon the filing of a UCC 

financing statement with respect thereto, as applicable, the Initial Member shall have a perfected 

and continuing first priority Lien on and security interest in the Secured Assets (whether now 

owned or existing, or hereafter acquired or arising), as security for the payment and performance 

(when due) by the Private Owner (including in its roles as the Manager and the Tax Matters 

Member) of the Private Owner Obligations. 

(d) As additional security for the Private Owner Obligations (and, as 

applicable, as part of the Secured Assets), the Private Owner shall deliver on the Closing Date, 

and at all times thereafter cause to be maintained, the Additional Security. In the event that the 

Private Owner determines to fulfill its obligation to provide the Additional Security by issuance 

of a Qualifying Letter of Credit, the Private Owner shall cause the issuance and delivery to the 

Initial Member, on the Closing Date, of a single Qualifying Letter of Credit in the full amount of 

such Additional Security. The Private Owner may, on one occasion (and only on one occasion, 

except as otherwise expressly permitted in the definition of LC Reissuance/Extension Failure 

under the circumstances specified therein), make a one-time substitution of the form of the 

Additional Security by substituting, as the case may be, either (x) a Qualifying Letter of Credit 

for Qualifying Cash Collateral, or (y) Qualifying Cash Collateral for a Qualifying Letter of 

Credit; provided, however, that at all times the amount of the Additional Security is equal to or 

greater than the Private Owner Pledged Amount; and provided, further, however, the Private 

Owner shall pay to the Initial Member the Additional Security Substitution Fee (as a condition to 

the exercise of such right to make such substitution) and shall further solely be responsible for 

any incurred costs of the Initial Member or the Company associated with any such substitution of 

the form of the Additional Security as referenced in this sentence. The Initial Member shall have 

the unilateral right to draw on any such Qualifying Letter of Credit and to provide instructions to 

the Paying Agent for the disposition of any Qualifying Cash Collateral, in each case without any 

requirement for any further consent, confirmation or instructions from the Private Owner; 

provided, however, that as between the Initial Member and the Private Owner (and without 

creating any right or obligation of the Paying Agent or any Issuing Bank to refuse to honor, or 

inquire as to the accuracy or sufficiency of, any applicable instructions from the Initial Member), 

the Initial Member agrees that (i) it shall not exercise such rights to so draw on any such 

Qualifying Letter of Credit unless there shall have occurred an Event of Default (whether or not 

relating to any Qualifying Letter of Credit) or an LC Reissuance/Extension Failure (with respect 

to such Qualifying Letter of Credit), and (ii) it shall not exercise such rights to so unilaterally 

direct the disposition of the Qualifying Cash Collateral from the Private Owner Pledged Account 

unless there shall have occurred an Event of Default. 

(e) On the Closing Date (and whether or not the Private Owner has elected to 

provide the Additional Security in the form of Qualifying Cash Collateral), the Private Owner 

shall establish the Private Owner Pledged Account with the Paying Agent for the exclusive 

purpose of holding Qualifying Cash Collateral (including in the form of any proceeds from a 

drawing on a Qualifying Letter of Credit at any time deposited in the Private Owner Pledged 

Account in accordance herewith). The Private Owner Pledged Account (and all funds and 

financial assets therein) shall be subject to the security interest granted herein for the benefit of 

the Initial Member pursuant to the terms of this Agreement, the Custodial and Paying Agency 

Agreement and the Private Owner Pledged Account Control Agreement. Funds in the Private 

15 

SFR Venture 20ll-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
Owner Pledged Account may be invested at the direction of the Private Owner from time to time 

in Permitted Investments in accordance with the Custodial and Paying Agency Agreement; 

provided, however, that the Private Owner is authorized to instruct the Custodian and Paying 

Agent to release to it that portion of the proceeds in the Private Owner Pledged Account which 

exceeds the required Private Owner Pledged Amount, all in accordance with Section 3.9(b) of 

the Custodial and Paying Agency Agreement. Conversely, it is understood and agreed that, 

pursuant to the first sentence of Section 3.13(d), if, at any time, the sum of (x) the aggregate 

undrawn (and available) amounts under the Qualifying Letter of Credit, if any, plus (y) the 

balance, if any, of the Qualifying Cash Collateral, is less than the Private Owner Pledged 

Amount, an Event of Default shall exist and (without limitation of the foregoing) the Private 

Owner immediately shall cure such Event of Default by depositing with the Paying Agent 

Qualifying Cash Collateral in the amount of the difference between the Private Owner Pledged 

Amount and the sum of (x) and (y). 

(t) Upon the occurrence of any LC Reissuance/Extension Failure, the Initial 

Member shall have the right (but not the obligation) to draw on all or any part of the undrawn 

amount of the QualifYing Letter of Credit subject to such LC Reissuance/Extension Failure; and 

the funds received by the Initial Member as a result of any such draw shall be deposited in the 

Private Owner Pledged Account (and thereby will become Qualifying Cash Collateral) and such 

LC Reissuance/Extension Failure shall not be deemed an Event of Default hereunder, in each 

case only so long as (i) there shall not have occurred any Event of Default (other than such LC 

Reissuance/Extension Failure), (ii) the Private Owner Pledged Account shall then be and remain 

open and subject to the Private Owner Pledged Account Control Agreement, (iii) upon such 

deposit in the Private Owner Pledged Account (of the funds received by the Initial Member from 

such draw), the aggregate amount of the Additional Security (disregarding such Qualifying 

Letter of Credit) shall be in an amount not less than the Private Owner Pledged Amount, and (iv) 

the Private Owner shall have paid to the Initial Member the Additional Security Substitution Fee 

in connection with the resulting substitution of such Qualifying Letter of Credit (or applicable 

undrawn amounts thereunder) with Qualifying Cash Collateral (which Additional Security 

Substitution Fee shall be deemed due and payable upon the occurrence of such LC 

Reissuance/Extension Failure), it being understood that, in the event the foregoing conditions are 

not satisfied, the Initial Member shall have the right to hold and apply such funds pursuant to 

Section 3.13(b) above. 

(g) The Private Owner hereby authorizes the filing by the Initial Member and 

its assignees of such UCC financing or continuation statements in such jurisdictions as the Initial 

Member or its assignees deem appropriate (in their sole and absolute discretion) to perfect and 

continue their first priority Lien and security interest with respect to the Secured Assets. The 

Private Owner shall deliver to the Initial Member an assignment and assumption agreement with 

respect to the Private Owner Interest, in the form attached hereto as Exhibit C, endorsed in blank, 

and executed by the Private Owner. The Initial Member may use the assignment and assumption 

agreement to effect the assignment of the Private Owner Interest at any time if an Event of 

Default occurs and is continuing. 

(h) After all of the obligations secured by the Secured Assets have been 

indefeasibly paid and performed in full (following the dissolution of the Company), the Initial 

16 

SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
Member shall, upon the request of the Private Owner, release any then outstanding Qualifying 

Letter of Credit and consent to the termination of the Private Owner Pledged Account Control 

Agreement. 

(i) The Initial Member's rights and remedies under this Agreement, any other 

Transaction Document or otherwise are cumulative and may be exercised singularly (and in such 

order as the Initial Member may determine in its sole discretion) or concurrently. Neither any 

failure nor delay on the part of the Initial Member to exercise any other right or remedy shall 

operate as a waiver thereof, nor shall any single or partial exercise of any right or remedy 

preclude any other or further exercise thereof or of any other right or remedy howsoever arising. 

In no event shall the Initial Member have any obligation to seek or exhaust any particular remedy 

prior to exercising any other remedy, and the Private Owner hereby waives any and all right to 

require the marshalling of assets in connection with any exercise by the Initial Member of its 

remedies hereunder or under any other Transaction Document. Under no circumstances shall the 

Initial Member be deemed or construed to have waived its right to draw upon any Qualifying 

Letter of Credit, to proceed against the Private Owner Pledged Account, to foreclose upon the 

Private Owner Interest or to exercise any of its other rights or remedies unless such waiver is in 

writing and executed by a duly authorized representative of the Initial Member. A waiver of any 

right or remedy on any one occasion shall not operate as a waiver of such right or remedy on any 

future occasion or as a waiver of any other right or remedy. 

(j) As used herein, "Event of Default" shall mean any one of the following 

events (whatever the reason for such Event of Default and whether it shall be voluntary or 

involuntary or be effected by operation of Law or pursuant to any judgment, decree or order of 

any court or any order, rule or regulation of any administrative or governmental body): 

(i) the receipt by the Company of notice from the PMN Agent that an 

"Event of Default" under (and as defined in) the Reimbursement, Security and Guaranty 

Agreement has occurred (unless such an Event of Default has not actually so occurred); or 

(ii) (x) the occurrence of any Insolvency Event (without any cure 

period other than as may be provided for in the definition of Insolvency Event): (A) with respect 

to the Company, the Private Owner, the Specified Parent of the Private Owner (or, if such 

Specified Parent is comprised of more than one Person, any Person comprising the Specified 

Parent) or any Person that Controls, or is Controlled by, such Specified Parent (or, if such 

Specified Parent is comprised of more than one Person, any Person comprising such Specified 

Parent); or (B) with respect to the Servicer (or any Subservicer), provided (for the avoidance of 

doubt, solely with respect to this clause (x)(B)) that, if such Servicer (or Subservicer) is not an 

Affiliate of the Private Owner, then such Insolvency Event pursuant to this clause (x)(B) shall 

not be an Event of Default hereunder (but shall in all events be a default under the applicable 

Servicing Agreement (or Subservicing Agreement)) so long as the Manager shall have fully 

replaced (or caused the replacement of) such affected Servicer or Subservicer within thirty days 

after the occurrence of such Insolvency Event; or (y) the occurrence of any Dissolution Event 

with respect to (A) the Private Owner or (B) with respect to the Servicer (or any Subservicer), 

provided (for the avoidance of doubt, solely with respect to this clause (y)(B)), that, if such 

Servicer (or Subservicer) is not an Affiliate of the Private Owner, then such Dissolution Event 

under this clause (y)(B), shall not be an Event of Default hereunder (but shall in all events be a 

17 

SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
default under the applicable Servicing Agreement (or Subservicing Agreement)) so long as the 

Manager shall have fully replaced (or caused the replacement of) such affected Servicer (or 

Subservicer) within thirty days after the occurrence of such Dissolution Event; or 

(iii) any failure of the Company to pay any Working Capital Expense 

when due in accordance with Section 12.6 of this Agreement, which failure continues 

unremedied for a period of thirty days after the date on which written notice of such failure 

requiring the same to be remedied shall have been given by the Initial Member to the Company; 

or 

(iv) any failure in any material respect of the Company or the Private 

Owner (for the avoidance of doubt, in any capacity, including as a Member and/or as the 

Manager) to perform any of its obligations under, or otherwise to comply with and observe any 

provision of, this Agreement, which continues unremedied for a period of thirty days after the 

date on which written notice of such failure requiring the same to be remedied shall have been 

given by the Initial Member to the Private Owner; or 

(v) the occurrence of either (x) any failure in any material respect by 

the Servicer to perform any of its obligations under, or otherwise to comply with and observe 

any provision of, the Servicing Agreement, which continues unremedied for a period of thirty 

days after the date on which written notice of such failure requiring the same to be remedied 

shall have been given by the Manager (in its individual capacity) or the Initial Member to the 

Servicer, or (y) a failure by the Manager (in its individual capacity) to replace the Servicer upon 

the occurrence of either (A) an Event of Default under (and as defined in) the Reimbursement, 

Security and Guaranty Agreement as a result of the Servicer's (or any Subservicer's) acts or 

omissions or (B) a material breach by the Servicer of, or an occurrence of "Default" under (and 

as defined in), the Servicing Agreement, in the case of (A) or (B) which continues unremedied 

for a period of thirty days after the date on which written notice of such failure requiring the 

same to be remedied shall have been given by the Initial Member to the Manager (in any 

capacity); or 

(vi) any failure in any material respect of (x) the Manager (in any 

capacity) to perform any of its obligations under, or otherwise to comply with and observe any 

provision of, the Servicing Agreement or (y) the Company to perform any of its obligations 

under, or otherwise to comply with and observe any provision of, the Custodial and Paying 

Agency Agreement (including any failure to pay fees or expenses when due thereunder) which, 

in the case of (x) or (y), remains unremedied for a period of thirty days after the date on which 

written notice of such failure requiring the same to be remedied shall have been given by the 

Initial Member or, as applicable, the Custodian or the Paying Agent, to the Manager (in any 

capacity) or the Company, as applicable; or 

(vii) there shall be any breach (or, for the avoidance of doubt, any 

attempted or purported Disposition that, but for Section 8.5 of this Agreement, would have 

constituted a breach) of Sections tl or 8.2 or any Restricted Servicer Change of Control, 

provided, that, if the applicable Servicer (or Subservicer) is not an Affiliate ofthe Private Owner, 

then such Restricted Servicer Change of Control shall not be an Event of Default hereunder (but 

shall in all events be an event of default under the applicable Servicing Agreement (or 

18 

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Amended and Restated LLC Operating Agreement 
Subservicing Agreement)) so long as the Manager shall have fully replaced (or caused the 

replacement of) such affected Servicer (or Subservicer) within thirty days after the occurrence of 

such Restricted Servicer Change of Control; or 

(viii) any failure of the Company to remit or cause to be remitted all 

Asset Proceeds to the Paying Agent (or to the applicable Company Account maintained with the 

Paying Agent) as and when required; or 

(ix) at any time, there shall exist any PO Owner that has not executed 

and delivered (to each of the "Beneficiaries" named therein) a Specified Parent/Owner 

Undertaking; or 

(x) (A) the failure, of the Private Owner, at any time, for any reason or 

to any extent, to maintain in full the Additional Security (other than the as a result of the Issuing 

Bank ceasing to be a Qualified Issuer), (B) the occurrence of any LC Reissuance/Extension 

Failure or (C) if applicable, any failure, at any time, for any reason or to any extent, by an 

Issuing Bank to comply with any terms, agreements or conditions of any Qualifying Letter of 

Credit; or 

(xi) any breach of Section I O.l(s) of this Agreement, which breach 

continues unremedied for a period of thirty days or more after the date on which written notice of 

such breach requiring the same to be remedied shall have been given by the Initial Member to 

the Private Owner or otherwise shall have been given to the Private Owner; or 

(xii) the failure of the Company to pay, when due, the Purchase Money 

Notes, or the failure of the Company to pay interest in full on the Purchase Money Notes for any 

three (3) Distribution Dates occurring in a twelve (12) month period. 

3.14. Purchase Right of Initial Member. Without prejudice to the rights of the Initial 

Member to foreclose on the Private Owner Interest in accordance with Section 3.13(a)(v): 

(a) Upon the occurrence and during the continuance of an Event of Default, 

the Initial Member may at any time, by notice (a "Buy-Out Notice") to the Private Owner, 

elect to purchase (or cause one or more designees to purchase) the Private Owner Interest for an 

amount, payable in cash, equal to (x) the fair market value of such Private Owner Interest 

(determined, if necessary, in accordance with Section 3.14(bl(iv)) as of a date (the "Buy-Out 

Valuation Date") selected by the Initial Member in its discretion between the date of the BuyOut Notice and the closing of such purchase (the "Buy-Out Closing"), less (y) any amounts 

owed by the Private Owner pursuant to Section 3.14(b)(v), and less (or plus) (z) the excess (or 

deficiency), for the period between the date of the Buy-Out Valuation Date and the 

consummation of the Buy-Out Closing, of (i) all distributions paid by the Company to or for the 

account of the Private Owner, including distributions pursuant to Section 6.6 and principal 

payments received by or on behalf of the Private Owner iil respect of Excess Working Capital 

Advances, over (or below) (ii) all Excess Working Capital Advances made by or on behalf ofthe 

Private Owner. 

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(b) If the Private Owner receives a Buy-Out Notice, the Buy-Out Closing 

shall be consummated as follows: 

(i) The Buy-Out Closing shall be held at the principal offices of the 

Company on a day selected by the Initial Member, which day shall, subject to Section 

3.14(b)(iv), be no later than six months after the Buy-Out Notice was delivered to the Private 

Owner or at such other place or on such other date as the Members may agree (the "Buy-Out 

Closing Date"). 

(ii) The Initial Member shall purchase (and/or cause one or more 

designees to purchase in the aggregate) all but not less than all of the of the Private Owner 

Interest for the consideration set forth in Section 3.14(a). and against delivery of such 

consideration, the Private Owner shall deliver all such documents and instruments as are 

necessary to transfer to the Initial Member (and/or its designee(s)), and in any event shall be 

deemed to have transferred, and to have represented and warranted to the Initial Member (and/or 

its designee(s)) that it has transferred, to the Initial Member (and/or its designee(s)), good title to 

(and, in any event, all right, title and interest of the Private Owner in and to) the entire Private 

Owner Interest, free and clear of all Liens other than those created by this Agreement and the 

Transaction Documents. 

(iii) The Private Owner shall obtain all material consents, approvals or 

waivers (including expiration or termination of a specified waiting period) of any Governmental 

Authority or Person that may be required in connection with the purchase and sale of the Private 

Owner Interest (other than any such consent, approval or waiver which has, if permitted by Law, 

been waived by the Initial Member). 

(iv) In the event of the delivery of a Buy-Out Notice, the Members 

shall attempt to agree on the fair market value of the Private Owner Interest as of the Buy-Out 

Valuation Date. If the Members are unable to agree on such value within fifteen days after the 

date of delivery of the Buy-Out Notice (or, if sooner, by the Buy-Out Closing Date), then such 

value shall be determined immediately thereafter in accordance with the Dispute Resolution 

Procedure, and, if applicable, the Buy-Out Closing Date shall be delayed until such date (after 

completion of the applicable valuation) as may be selected by the Initial Member. For the 

avoidance of doubt, in no event shall the right of the Initial Member to purchase the Private 

Owner Interest under this Section 3.14 or any valuation resulting from a Dispute Resolution 

Procedure create any obligation with respect to, or otherwise limit the rights of the Initial 

Member in connection with, any concurrent or subsequent foreclosure (or sale) of the Private 

Owner Interest pursuant to Section 3.13 and/or exercise of relevant rights under the Uniform 

Commercial Code or otherwise, and the Private Owner acknowledges and agrees that any 

foreclosure and sale pursuant to Section 3.13 and relevant rights under the Uniform Commercial 

Code or otherwise may result in a sale price for the Private Owner Interest that is significantly 

lower than the fair market value of the Private Owner Interest potentially (or having actually 

been) determined pursuant to this Section or other price set out in any Buy-Out Notice. 

(v) All out-of-pocket costs and expenses incurred by the Initial 

Member and the Company in connection with the exercise of the Initial Member's rights under 

this Section 3.14 and the sale of the Private Owner Interest by the Private Owner (including fees 

20 

SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
of any investment banking firm retained in connection with the Dispute Resolution Procedure 

and legal fees and expenses incurred in connection with obtaining any necessary consents, 

approvals or waivers (including expiration or termination of a specified waiting period) of 

Governmental Authorities) shall be borne by the Private Owner and may be deducted from the 

purchase price otherwise payable by the Initial Member (or its designee(s)) for the Private Owner 

Interest. 

(c) The failure of the Initial Member to exercise its rights under this Section 

3.14 in connection with any Event of Default shall in no way affect or limit the exercise of such 

rights in connection with any other Event of Default by the Private Owner. 

(d) At any time prior to the Buy-Out Closing, the Initial Member may elect 

not to proceed with the Buy-Out Closing (without any liability or further obligation with respect 

thereto), and the Private Owner shall remain responsible for amounts owed under Section 

3.14(b)(v) notwithstanding any such election by the Initial Member. 

(e) Any distributions payable by the Company to the Private Owner after the 

Buy-Out Valuation Date (and prior to the consummation of the Buy-Out Closing) shall, at the 

option of the Initial Member, be paid to and held by the Initial Member (or, if permitted by the 

Paying Agent, held by the Paying Agent in the Distribution Account) and, at the Buy-Out 

Closing or a reasonable time thereafter, be released to the Private Owner less, without 

duplication, any amounts owed by the Private Owner pursuant to this Agreement (including costs 

and expenses pursuant to Section 3.14(b)(v)). For the avoidance of doubt, neither the Initial 

Member nor the Paying Agent shall have any obligation to segregate, or pay interest or other 

income in respect of, any sums held pursuant to this Section 3.14(e). 

3.15. No ERISA Plan Assets. The Manager shall use its best efforts to ensure that the 

Company's assets are not deemed to be ERISA Plan Assets. 

ARTICLE IV 

Membership Interests; Rights and Duties of, and Restrictions on, Members 

4.1. General. The membership of the Company shall consist of the Members listed 

from time to time in the schedule attached hereto as Annex I (which is hereby incorporated in 

this Agreement), as amended, restated, supplemented or otherwise modified from time to time as 

in accordance herewith (the "Member Schedule"). The Manager shall cause the Member 

Schedule to be amended from time to time to reflect (to the extent relevant, in accordance with 

the terms hereof) the admission of any additional or substitute Members, additional Capital 

Contributions of the Members, the issuance of additional limited liability company interests, 

transfers of limited liability company interests in the Company, repurchases, redemptions or 

cancellations of limited liability company interests in the Company, the cessation or withdrawal 

of a Member for any reason or the receipt by the Company of notice of any change of name or 

address of a Member. 

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4.2. LLC Interests. 

(a) Creation and Issuance. The Company is only authorized to issue the 

limited liability company interests that exist as of the date hereof, and the Company may not 

hereafter create or issue any additional limited liability company interest, provided, that nothing 

in this sentence restricts the Disposition of any outstanding LLC Interest by any Member (which 

matter is governed by Article VIII). The Company's LLC Interests shall be uncertificated. As of 

the Closing Date, the limited liability company interests in the Company are owned by the Initial 

Member and the Private Owner, as set forth in the Member Schedule. 

(b) Distributions. Subject to Sections 6.6, distributions to the holders of 

limited liability company interests in the Company shall be made as provided in Sections 6.6(b) 

and 9.2. 

(c) No Retirement Fund or Conversion. The limited liability company 

interests in the Company shall not be subject to the operation of a retirement or sinking fund to 

be applied to the purchase or redemption thereof for retirement and shall not be convertible into 

any other class of limited liability company interests. 

(d) Voting Rights. Except to the extent otherwise required by the Act or 

expressly provided in this Agreement, the holders of the limited liability company interests in the 

Company shall be entitled to vote on all matters upon which the Members have the right to vote as 

set forth in this Agreement or provided in the Act. Except as expressly set forth elsewhere in this 

Agreement (including Sections 3 .I and 3.4 ), the voting rights of each holder of a limited liability 

company interest in the Company shall be based on such holder's Percentage Interest. 

4.3. Filings; Duty of Members to Cooperate. The Manager shall promptly cause to be 

executed, delivered, filed, recorded or published, as appropriate, and the Private Owner will, as 

requested by the Manager from time to time, execute and deliver, (i) all certificates, documents 

and other instruments that the Manager deems necessary or appropriate to form, qualify or 

continue the existence or qualification of the Company as a limited liability company in the State 

of Delaware or as a foreign limited liability company in all other jurisdictions in which the 

Company may, or may desire to, conduct business or own Company Property, (ii) any 

amendment to the Certificate or any instrument described in clause (i) required because of, or in 

order to effectuate, an amendment to this Agreement, or any change in the membership of the 

Company, in accordance with the terms hereof, (iii) all certificates, documents and other 

instruments (including conveyances and a certificate of cancellation) that the Manager deems 

necessary or appropriate to reflect the dissolution and liquidation of the Company pursuant to the 

terms of this Agreement, and (iv) such other certificates, documents and other instruments as are 

required by Law or by any Governmental Authority to be executed by them in connection with 

the Business as conducted or proposed to be conducted by the Company from time to time. As 

soon as reasonably practical after the date hereof, the Manager shall cause the Company to apply 

for, and thereafter use its best efforts to obtain, as quickly as possible, and maintain, all such 

licenses as are required to conduct the Business, including qualifications to conduct business in 

jurisdictions other than Delaware and licenses to purchase, own or manage the Assets, if the 

failure to so obtain such licenses would reasonably be expected to result in the imposition of 

fines, penalties or other liabilities on the Company, claims and defenses being asserted against 

22 

SFR Venture 2011-l Structured Transaction 

Amended and Restated LLC Operating Agreement 
the Company (including counterclaims and defenses asserted by any Borrower under the Assets), 

or materially adversely affect the Company or the Company's ability to foreclose on the 

Collateral securing any Loan or otherwise realize the full value of any Asset or Acquired 

Property. 

4.4. Certain Restrictions and Requirements. 

(a) No Member may use or possess Company Property other than for a 

Company purpose, except as provided under license or other contractual arrangements. No 

Member shall have authority to bind, or otherwise to act on behalf of, the Company except 

pursuant to authority expressly granted herein or pursuant to authority granted by the Manager in 

accordance with the terms hereof. 

(b) From and after the Closing Date, no Person may or shall be admitted as a 

member of the Company except pursuant to and in accordance with Article VIII hereof. 

(c) Each Member, other than the Initial Member (and its Related Persons), 

shall at all times meet the qualifications of a Qualified Transferee. 

4.5. No Fiduciary Duties or Liability of Initial Member. Nothing in this Agreement is 

intended to create, or creates, any fiduciary duty of the Initial Member (or any other Initial 

Member Related Person) to the Company or the Private Owner (and, without limitation of the 

foregoing, to the extent that, but for this sentence, any such fiduciary duty otherwise would exist 

(including by operation of Law), the Company and the Private Owner irrevocably and 

unconditionally waive any such fiduciary duty). In furtherance and not in limitation of the 

preceding sentence, neither the Initial Member nor any other Initial Member Related Person shall 

be liable, responsible or accountable, whether directly or indirectly, in contract or tort or 

otherwise, to the Company, any other Person in which the Company has a direct or indirect 

interest or any Member (or any Affiliate of any of the foregoing), for any Losses asserted 

against, suffered or incurred by the Company, any Person in which the Company has a direct or 

indirect interest or any Member (or any Affiliate of any of the foregoing) arising out of, relating 

to or in connection with this Agreement or any act or failure to act pursuant to this Agreement, or 

otherwise with respect to: 

(a) the management or conduct of the business and affairs of the Company or 

any Person in which the Company has a direct or indirect interest or any of their respective 

Affiliates (including actions taken or not taken by any Initial Member Related Person as an 

officer or director of any Person in which the Company has a direct or indirect interest or any 

Affiliates of such Person); 

(b) the offer and sale of limited liability company interests in the Company 

(including the LLC Interests) or the issuance of the Purchase Money Notes; or 

(c) the management or conduct of the business and affairs of any Initial 

Member Related Person insofar as such business or affairs relate to the Company or any Person 

in which the Company has a direct or indirect interest or to any Member (or any of its Affiliates), 

including all: 

23 

SFR Venture 2011~1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
(i) activities in the conduct of the Business, and 

(ii) activities in the conduct of other business engaged in by any Initial 

Member Related Person which might involve a conflict of interest vis-a-vis the Company 

or any Person in which the Company has a direct or indirect interest or any Member (or 

any of their respective Affiliates) or in which any Initial Member Related Person realizes 

a profit or has an interest; 

except, in each case, that this sentence does not apply to Losses resulting from acts or omissions 

of such Initial Member Related Person which were taken or omitted which constituted fraud, 

gross negligence, willful misconduct, or an intentional material breach of this Agreement or any 

other Transaction Document. 

4.6. Indemnification. 

(a) The Private Owner shall indenmify and hold harmless the Initial Member, 

the Transferor, the PMN Agent and the FDIC, and their respective Related Persons (all of the 

foregoing, collectively, the "Indemnified Parties"), from and against any and all Losses 

whatsoever directly or indirectly resulting from, connected with, arising out of or related to (i) 

any breach of or inaccuracy in any of the representations or warranties of the Private Owner (in 

any capacity, including as the Manager) contained in this Agreement, (ii) any failure, by (x) the 

Company (during any period when the Private Owner is the Manager, and subject to the 

clarification set forth below in this Section 4.6(a)), the Private Owner (in any capacity, including 

as the Manager) or any of their respective Affiliates or (y) any Related Person of any Person 

described in sub-clause (x), to perform the obligations of the Company or the Private Owner (in 

any capacity, including as the Manager) under, and otherwise to comply with and observe the 

provisions of, this Agreement or any other Transaction Document (including Losses relating to 

(A) the Company's obligations with respect to litigation referred to in Section 4.5 of the 

Contribution Agreement to the extent provided therein, (B) the Company's obligations under 

Sections 3.1 and 3.2 of the Contribution Agreement (including all costs and expenses of the 

Receiver in completing any applicable transfers pursuant to exercise of rights under such 

section), or (C) any claim asserted by the Initial Member against the Company or the Private 

Owner (in any capacity, including as the Manager) to enforce its rights hereunder), or any thirdparty allegation or claim based upon facts alleged that, if true, would constitute such a breach, 

(iii) any gross negligence, bad faith or willful misconduct (including any act or omission 

constituting theft, embezzlement, breach of trust or violation of any Law) on the part of any 

Person listed or described in sub-clause (x), (iv) any Losses with respect to which the Receiver 

was released, or with respect to which the Company should have obtained a release from the 

applicable Borrowers or other Obligors, in accordance with Section 4.17(b) of the Contribution 

Agreement, (v) with respect to any period when the Private Owner is the Manager, the events 

and circumstances (and Losses) described in clauses (iii) and (iv) of Section 8.13(a) of the 

Contribution Agreement, or (vi) any Obligations attributable to acts or omissions of the Private 

Owner (or any of its Related Persons) occurring prior to the Closing Date to the extent such 

actions or omissions would have subjected the Private Owner to the indemnification provisions 

herein had the same occurred on or after the Closing Date. The Private Owner's obligation 

under this Section 4.6(a) shall, with respect to any third-party beneficiary of this Agreement (and 

its Related Persons), survive the termination of this Agreement or such third party beneficiary 

24 

SFR Venture 2011Ml Structured Transaction 

Amended and Restated LLC Operating Agreement 
otherwise ceasing generally to constitute such a third party beneficiary. Each Indemnified Party 

shall deliver notice, of any claim or demand made by any Person against such Indemnified Party 

for which such Indemnified Party may seek indemnification under this Section 4.6(a) (a "Third 

Party Claim"), to the Private Owner promptly after receipt by such Indemnified Party of written 

notice of the Third Party Claim, describing such Third Party Claim in reasonable detail. The 

failure or delay to provide such notice, however, shall not release the Private Owner from any of 

its obligations under this Section 4.6 except to the extent that it is materially prejudiced by such 

failure or delay. 

The Private Owner acknowledges and agrees that it shall have no recourse 

(including on account of the provisions of Section 8.13 of the Contribution Agreement) against 

the Company for any amounts the Private Owner is required to pay pursuant to this Section 4.6. 

For the purposes of this Section 4.6, the term "Initial Member" shall be deemed to include any 

Person at any time constituting the "Initial Member" under this Agreement (even if such Person 

has ceased to be the "Initial Member" under this Agreement) and (without limitation of the 

foregoing) any Person at any time holding all or any portion of the LLC Interest initially held by 

the Initial Member immediately after the Closing, in each case even if such Person has since 

ceased to be a member of the Company or to hold any limited liability company interest in the 

Company. 

For purposes of clarification, with respect solely to the obligations of the Private 

Owner under this Section 4.6(a) in connection with a breach by the Company (during any period 

when the Private Owner is the Manager), the Private Owner shall not be responsible for any 

Losses arising out of or resulting from any failure by the Company to pay its separate payment 

obligations (including such payment obligations under the Purchase Money Notes), to the extent 

that all of the following are satisfied: (1) such failure is the result of the Company having 

insufficient available funds notwithstanding the Servicing and the management of the Company 

by the Manager (and, as applicable, the Servicer and any Subservicers) in accordance with this 

Agreement and the other Transaction Documents (including through exercise of any 

discretionary authority with respect to incurrence of payment obligations and maintenance and 

application of applicable reserves in a manner so as to reasonably avoid any such breach), (2) 

such failure and resulting Losses are not attributable in whole or in part to any breach (or other 

action or omission in violation of the Servicing Standard or any provision of this Agreement or 

any other Transaction Document) by the Private Owner (in any capacity, including as Manager) 

or any of its Affiliates (other than the Company), or by any of the respective Related Persons of 

any of the foregoing, and (3) the Private Owner (in any capacity) is not required to pay (or 

advance applicable funds to the Company for payment of) or otherwise bear such payment 

obligations pursuant to the terms of this Agreement or any other Transaction Document. 

(b) If for any reason the indemnification provided for herein is unavailable or 

insufficient to hold harmless the Indenmified Parties, the Private Owner shall contribute to the 

amount paid or payable by the Indemnified Parties as a result of the Losses of the Indemnified 

Parties in such proportion as is appropriate to reflect the relative fault of the Indemnified Parties, 

on the one hand, and the Private Owner (in any capacity, including as the Manager) and its 

Related Persons, on the other hand, in connection with the matters that are the subject of such 

Losses. 

25 

SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
(c) If the Private Owner confirms in writing to the Indemnified Party within 

fifteen days after receipt of a Third Party Claim the Private Owner's responsibility to indemnify 

and hold harmless the Indemnified Party therefor, the Private Owner may elect to assume control 

over the compromise or defense of such Third Party Claim at the Private Owner's sole expense 

and with counsel selected by the Private Owner, which counsel must be reasonably satisfactory 

to the Indemnified Party, provided that (i) the Indemnified Party may, if such Indemnified Party 

so desires, employ counsel at such Indemnified Party's own expense to assist in the handling (but 

not control the defense) of any Third Party Claim; (ii) the Private Owner shall keep the 

Indemnified Party advised of all material events with respect to any Third Party Claim; (iii) the 

Private Owner shall obtain the prior written approval of the Indemnified Party before ceasing to 

defend against any Third Party Claim or entering into any settlement, adjustment or compromise 

of such Third Party Claim involving injunctive or similar equitable relief being imposed upon the 

Indemnified Party or any of its Affiliates; and (iv) the Private Owner will not, without the prior 

written consent of the Indemnified Party, settle or compromise or consent to the entry of any 

judgment in any pending or threatened action in respect of which indemnification may be sought 

hereunder (whether or not any such Indemnified Party is a party to such action), unless such 

settlement, compromise or consent by its terms obligates the Private Owner to satisfy the full 

amount of the liability in connection with such Third Party Claim and includes an unconditional 

release of such Indemnified Party from all liability arising out of such Third Party Claim. 

(d) Notwithstanding anything contained herein to the contrary, the Private 

Owner shall not be entitled to control (and if the Indemnified Party so desires, it shall have sole 

control over) the defense, settlement, adjustment or compromise of (but the Private Owner shall 

nevertheless be required to pay all Losses incurred by the Indemnified Party in connection with 

such defense, settlement or compromise): (i) any Third Party Claim that seeks an order, 

injunction or other equitable relief against the Indemnified Party or any of its Affiliates; (ii) any 

action in which both the Private Owner (in any capacity, including as the Manager) or any 

Affiliate of the Private Owner, on one hand, and the Indemnified Party, on the other hand, are 

named as parties and either the Private Owner (or such Affiliate) or the Indemnified Party 

determines with advice of counsel that there may be one or more legal defenses available to it 

that are different from or additional to those available to the other party or that a conflict of 

interest between such parties may exist in respect of such action; and (iii) any matter that raises 

or implicates any issue relating to any power, right or obligation of the FDIC under any Law. In 

addition to the foregoing, if the Private Owner elects not to assume the compromise or defense of 

any Third Party Claim, fails to timely and properly notify the Indemnified Party of its election as 

herein provided, or, at any time after assuming such defense, fails to diligently defend against 

such Third Party Claim in good faith, the Indemnified Party may pay, settle, compromise or 

defend against such Third Party Claim (but the Private Owner shall nevertheless be required to 

pay all Losses incurred by the Indemnified Party in connection with such payment, settlement, 

compromise or defense). In connection with any defense of a Third Party Claim (whether by the 

Private Owner or the Indemnified Party), all of the parties hereto shall, and shall cause their 

respective Affiliates to, cooperate in the defense or prosecution thereof and to in good faith retain 

and furnish such records, information and testimony, and attend such conferences, discovery 

proceedings, hearings, trials and appeals, as may be reasonably requested by a party hereto in 

connection therewith. 

26 

SFR Venture 2011-l Structured Transaction 

Amended and Restated LLC Operating Agreement 
(e) In the event the Company is reimbursed for or uses the Working Capital 

Reserve or Excess Working Capital Advances to pay costs or expenses of the type referred to in 

clause (v) or (vi) of the definition of Servicing Expenses and it is subsequently determined that 

the Company was not entitled to reimbursement for (or to use the Working Capital Reserve or 

Excess Working Capital Advances to pay) all or any portion of such costs and expenses because 

the Company did not satisfy the requirements of such clause (v) or clause (vi), as applicable, of 

the definition of Servicing Expenses (such costs and expenses, the "Unreimbursable 

Expenses"), the Manager shall, in addition to any other Losses for which the Manager may be 

liable with respect to the claim to which such costs and expenses relate, reimburse the cost of 

such Unreimbursable Expenses to each Member based on such Member's Percentage Interest as 

set forth below, except to the extent such Unreimbursable Expenses were funded through Excess 

Working Capital Advances that remain outstanding (in which case the portion of any such 

outstanding Excess Working Capital Advance that was so used for Unreimbursable Expenses 

shall itself become unreimbursable and be deemed forgiven with no further right of the Manager 

to collect or receive the same). Any such reimbursement by the Manager pursuant to the 

foregoing shall be as follows: within ten Business Days after written demand therefor from either 

Member, the Manager shall pay each Member by wire transfer of immediately available funds to 

an account specified by each Member an amount equal to such Member's Percentage Interest (as 

of the later of (x) the date of such demand or (y) the date of such payment) multiplied by the 

amount of all such Unreimbursable Expenses. 

(f) The Company shall indemnify and hold harmless each Member and each 

Member's respective officers, directors, employees and members (all of the foregoing 

collectively, the "Covered Persons") for any Losses incurred by such Covered Person by reason 

of a third-party claim against such Covered Person (other than, for the avoidance of doubt, a 

claim by a Related Person of such Covered Person (or, if such Covered Person is other than a 

Member, by a Related Person of the Member in respect of which such Covered Person 

constitutes a Covered Person)) relating to any act or omission by or of such Covered Person in 

connection with the exercise or performance of the rights, powers, responsibilities and 

obligations of such Covered Person (or, if such Covered Person is other than a Member, of the 

Member in respect of which such Covered Person so constitutes a Covered Person) regarding the 

Company except for (i) any such third-party claim, or Loss, resulting from fraud, gross 

negligence, willful misconduct or an intentional breach of this Agreement or any other 

Transaction Document by such Covered Person (or if such Covered Person is other than a 

Member, by the Member in respect of which such Covered Person so constitutes a Covered 

Person), and (ii) in the case ofthe Private Owner (in any capacity, including as the Manager), (x) 

any claim or demand by the Servicer or Subservicer (or, for the avoidance of doubt, any Losses 

arising out of or related to such claim or demand) and (y) any such third-party claim, or Loss, 

that, in whole or in part and directly or indirectly, results from, is connected with, arises out of or 

relates to any of the matters described in clauses (i) through (vi) of Section 4.6(a). 

(g) Tax Liability of Ownership Entity. Notwithstanding anything to the 

contrary contained herein, if any Ownership Entity is not a pass-through entity with no entitylevel income tax obligations, distributions to the Initial Member pursuant to Section 6.6 

(including for the purposes of Section 9 .2( c)) shall be allocated before accrual or payment of any 

income Tax payable by such Ownership Entity, and the Private Owner (or its successors or 

27 

SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
assigns) shall indemnify and hold harmless the Initial Member from and against any liability for 

any income Taxes payable by the Ownership Entity; provided, however, that the foregoing 

special allocation and indemnity shall not apply if (i) the Private Owner (and each of its 

successors and assigns) has taken all steps necessary to secure pass-through treatment of the 

Ownership Entity and (ii) the liability for income Taxes payable by the Ownership Entity arises 

solely as a result of a change in Law applicable to pass-through entities occurring after the date 

hereof and not as a result of action (or inaction) by the Private Owner (or its successors or 

assigns). 

(h) Offsets. Without limiting any other rights of the Initial Member 

hereunder, in the event the Initial Member exercises any rights or remedies as a result of or in 

connection with a breach hereunder or the occurrence of an Event of Default (including relating 

to a breach of Section 4.6), all costs and expenses (including reasonable attorneys' fees and 

litigation and similar costs, and other out-of-pocket expenses incurred in investigating, 

defending, asserting or preparing the defense or assertion of any claim) incurred by the Initial 

Member with respect thereto may be recovered by the Initial Member by the turnover to the 

Initial Member of an equal amount of any payment or distribution otherwise payable to the 

Private Owner (including any Interim Management Fee or the Management Fee), whether in its 

capacity as a Member or as the Manager (in each case except to the extent such breach or Event 

of Default is attributable exclusively to a Manager having been appointed by the Initial Member 

or the PMN Agent following removal ofthe Private Owner in such capacity, or to any applicable 

Servicer (and any of its Subservicers) having been engaged by the Initial Member, the Company 

or the applicable replacement Manager following such removal of the Private Owner as the 

Manager, in each case that is not an Affiliate of the Private Owner). The Private Owner and the 

Company shall cooperate with the Initial Member to effect any such turnover. 

ARTICLEV 


Capital Contributions; Excess Working Capital Advance 


5.1. Capital Contributions. 

(a) Members' Contribution. Pursuant to the Contribution Agreement, the 

Initial Member made a Capital Contribution to the Company in an amount equal to the Initial 

Member Capital Contribution. In connection with the Private Owner Interest Sale Agreement, 

the Private Owner acquired from the Initial Member the Private Owner Interest representing a 

40% equity interest in the Company in exchange for the Private Owner Interest Sale Price. After 

giving effect to the foregoing transactions, (and to the Capital Contributions referenced in 

Section 5.2 below), the respective Capital Accounts of the Initial Member and the Private Owner 

as of the Closing Date are as set forth in Annex I (the Member Schedule). 

(b) From and after the Closing Date (and except as provided in Section 5.2 

below), the Members shall have no obligation to make any additional Capital Contributions to 

the Company. 

5.2. Working Capital Reserve Account. On the Closing Date, the Initial Member and 

the Private Owner shall fund, as Capital Contributions to the Company, the Working Capital 

Reserve Account in accordance with the provisions of Section 12.11 and Section l of the Private 

28 

SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
Owner Interest Sale Agreement, which funds shall be used for payment of Working Capital 

Expenses in accordance with such Section 12.11 and as otherwise permitted pursuant to the 

Custodial and Paying Agency Agreement. Such Capital Contributions to fund the Working 

Capital Reserve Account on the Closing Date shall not affect the relative percentage LLC 

Interests of the Initial Member and the Private Owner. 

5.3. [Reserved]. 

5.4. [Reserved]. 

5.5. Excess Working Capital Advances. In the event that there are insufficient funds 

in the Collection Account, and insufficient available funds in the Working Capital Reserve 

Account (including, as applicable, by a permitted release of such funds to the Collection Account 

or as otherwise permitted in the Custodial and Paying Agency Agreement) to pay any Working 

Capital Expenses, then the Manager shall, except as otherwise provided in Section 12.6, make an 

advance of its own funds to the Company to be used by the Company for payment of such 

required Working Capital Expenses (any such advance to the Company, an "Excess Working 

Capital Advance"). No Excess Working Capital Advance shall accrue any interest thereon. 

Excess Working Capital Advances shall be repaid in accordance with Section 5.1 of the 

Custodial and Paying Agency Agreement. To the extent multiple Working Capital Expenses 

(payment of which is permitted to be made using such Excess Working Capital Advance) are 

outstanding, any funding or use by the Manager of Excess Working Capital Advances for 

payment of all or any of the same shall follow the relevant priorities (as among such Working 

Capital Expenses) as set forth, first, in Section 3.1 (b)(i) of the Custodial and Paying Agency 

Agreement, and, second, in the Priority of Payments, as applicable. All Excess Working Capital 

Advances, together with a detailed statement of the sources and uses thereof shall be reflected in 

the Monthly Report with respect to the calendar month during which (or, as applicable, the 

Distribution Date for which) the relevant Excess Working Capital Advance was made. The 

Manager may not Dispose of its interest in any Excess Working Capital Advances without the 

consent of each of the Required Consenting Parties. Excess Working Capital Advances shall not 

be regarded as additional Capital Contributions. 

ARTICLE VI 

Capital Accounts; Allocations; Priority of Payments; Distributions 

6.!. Capital Accounts. A Capital Account shall be established and maintained for 

each Member to which shall be credited the Capital Contributions made by such Member and 

such Member's allocable share of Net Income (and items thereof), and from which shall be 

deducted distributions to such Member of cash or other Company Property and such Member's 

allocable share of Net Loss (and items thereof). As to the Private Owner, the initial Capital 

Account shall correspond to that portion of the Capital Account of the Initial Member that is 

attributable to the Private Owner Interest acquired by the Private Owner pursuant to the Private 

Owner Interest Sale Agreement, together with the Private Owner WCR Account Deposit made 

pursuant to the Private Owner Interest Sale Agreement. A Member's Capital Account also shall 

be adjusted for items specially allocated to such Member under this Article VI. The Capital 

Accounts of the Members generally shall be adjusted and maintained in accordance with 

Treasury Regulations Section l.704-l(b)(2)(iv); provided, however, that such adjustments to, 

29 

SFR Venture 2011-l Structured Transaction 

Amended and Restated LLC Operating Agreement 
and maintenance of, the Capital Accounts shall not adversely affect the manner m which 

distributions are to be made to the Members under Section 6.6. 

6.2. Allocations to Capital Accounts. Allocation of Net Income and Net Loss shall be 

made as provided in this Article VI. 

(a) General Allocation Rules. Except as otherwise provided in this 

Agreement, Net Income and Net Loss (and, to the extent necessary, individual items of income, 

gain, loss, deduction or credit) of the Company shall be allocated among the Members in a 

manner such that, after giving effect to the special allocations set forth in Section 6.2(b), the 

Capital Account balance of each Member, immediately after making such allocation, is, as nearly 

as possible, equal to (i) the distributions that would be made to such Member pursuant to Section 

6.6 ifthe Company were dissolved, its affairs wound up and its assets sold for cash equal to their 

Book Value, all Company liabilities were satisfied (limited with respect to each nonrecourse 

liability to the tax basis of the assets securing such liability), and the net assets of the Company 

were distributed, in accordance with Section 9.2(c), to the Members immediately after making 

such allocation, minus (ii) such Member's share of "partnership minimum gain" and "partner 

nonrecourse debt minimum gain" (as such terms are used in Treasury Regulations Section 1.704­

2), computed immediately prior to the hypothetical sale of assets. 

(b) Allocations in Special Circumstances. The following special allocations 

shall be made in the following order: 

(i) Minimum Gain Charge back. Notwithstanding any other provision 

of this Article VI, if there is a net decrease in minimum gain (as it corresponds to the definition 

of "partnership minimum gain" in Treasury Regulations Section 1.704-2(b)(2) and (d)) during 

any Fiscal Year, the Members shall be specially allocated items of Company income and gain for 

such Fiscal Year (and, if necessary, subsequent Fiscal Years) in an amount equal to the portion 

of such Member's share of the net decrease in minimum gain, determined in accordance with 

Treasury Regulations Section 1.704-2(f) and (g). This Section 6.2(b)(i) is intended to comply 

with the "minimum gain chargeback" requirement in such section of the Treasury Regulations 

and shall be interpreted consistently therewith. 

(ii) Member Minimum Gain Chargeback. Notwithstanding any other 

provision of this Article VI other than Section 6.2(b)(i), if there is a net decrease in minimum 

gain attributable to a Member nonrecourse debt (as it corresponds to the definition of 

"partnership nonrecourse debt minimum gain" in Treasury Regulations Section 1.704-2(i)) 

during any Fiscal Year, each Member shall be specially allocated items of Company income and 

gain for such Fiscal Year (and, if necessary, subsequent Fiscal Years) in an amount equal to the 

portion of such Member's share of the net decrease in such minimum gain attributable to such 

Member's nonrecourse debt, determined in accordance with Treasury Regulations Section 1.704­

2(i). This Section 6.2(b)(ii) is intended to comply with the "partner minimum gain chargeback" 

requirement in such section of the Treasury Regulations and shall be interpreted consistently 

therewith. 

(iii) Qualified Income Offiet. In the event any Member, for any reason, 

whether expected or not, has an Adjusted Capital Account Deficit, items of Company income 

30 

SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
and gain shall be specially allocated to each such Member in an amount and manner sufficient to 

eliminate, to the extent required by the Treasury Regulations, such Adjusted Capital Account 

Deficit as quickly as possible, provided that an allocation pursuant to this Section 6.2(b)(iii) shall 

be made only if and to the extent that such Member would have such Adjusted Capital Account 

Deficit after all other allocations provided for in this Section 6.2 have been tentatively made as if 

this Section 6.2(b)(iii) were not in this Agreement. This Section 6.2(b)(iii) is intended to comply 

with the "qualified income offset" provisions in Treasury Regulations Section 1.704­

l (b )(2)(ii)( d) and shall be interpreted consistently therewith. 

(iv) Nonrecourse Deductions. Any nonrecourse deductions attributable 

to a Member nonrecourse debt (as described in Treasury Regulations Section l.704-2(i)) shall be 

allocated to the Member who bears the economic risk of loss with respect to such nonrecourse 

debt. Otherwise, nonrecourse deductions shall be allocable in accordance with the Members' 

respective Percentage Interests. 

(v) Loss Allocation Limitation. No allocation of Net Loss (or any item 

thereof) shall be made to any Member to the extent that such allocation would create or increase 

a Member's Adjusted Capital Account Deficit. If, in the allocation of Net Loss (or any item 

thereof), less than all Members would have an Adjusted Capital Account Deficit as a result of 

such allocation, then any Net Loss (or item thereof) not allocable to any such Member(s) as a 

result of such limitation shall be allocated (subject to such limitation) to the other Member so as 

to allocate the maximum permissible Net Loss to each Member under Treasury Regulation 

Section 1.704-l(b )(2)(ii)( d). 

(vi) Curative Allocations. The allocation provJsJOns of this 

Section 6.2(b) are intended to comply with certain requirements of the Treasury Regulations. 

Notwithstanding any other provisions of this Article VI, any allocation effected pursuant to this 

Section 6.2(b) shall be taken into account in allocating Net Income and Net Loss among the 

Members such that the cumulative effect of all such allocations achieves the fundamental 

purpose of Section 6.2(a), so that the Capital Account balances correspond to the amounts 

distributable to the Members. 

(c) Allocations in the Event of Disallowed Deductions. In the event that any 

fees, interest or other amounts paid to a Member or an Affiliate of a Member pursuant to this 

Agreement or any other agreement between the Company and such Member or Affiliate 

providing for the payment of such amounts, and deducted by the Company, whether in reliance 

upon Section 162, 163, 707(a) or 707(c) of the Code or otherwise, are disallowed as deductions 

to the Company on its federal income tax return for the fiscal year in or with respect to which 

such amounts are paid and are treated instead as Company distributions, then: 

(i) the Net Income or Net Loss, as the case may be, for the fiscal year 

in or with respect to which such fees, interest or other amounts were paid shall be increased or 

decreased, as the case may be, by the amount of such fees, interest or other amounts that are 

disallowed and treated as Company distributions; and 

(ii) there shall be allocated to the Member who received (or whose 

Affiliate received) such payments an amount of gross income for the fiscal year in or with 

31 

SFR Venture 2011Ml Structured Transaction 

Amended and Restated LLC Operating Agreement 
respect to which such fees, interest or other amounts were paid an amount equal to such fees, 

interest or other amounts that are so disallowed and treated as Company distributions. 

(d) Transfer of or Change in LLC Interests. The Tax Matters Member is 

authorized to adopt any convention or combination of conventions likely to be upheld for federal 

income tax purposes regarding the allocation of items of Company income, gain, loss, deduction 

and expense with respect to a transferred LLC Interest. A transferee of an LLC Interest in the 

Company shall succeed to the Capital Account of the transferor Member to the extent it relates to 

the transferred LLC Interest. 

6.3. Tax Allocations. 

(a) General Rules. Except as otherwise provided in Section 6.3(b), for each 

Fiscal Year, items of Company income, gain, loss, deduction and expense shall be allocated, for 

federal, state and local income tax purposes among the Members in the same manner as the Net 

Income (and items thereof) or Net Loss (and items thereof) of which such items are components 

were allocated pursuant to Section 6.2. 

(b) Section 704(c) of the Code. Income, gains, losses and deductions with 

respect to any property (other than cash) contributed or deemed contributed to the capital of the 

Company shall, solely for income tax purposes, be allocated among the Members so as to take 

account of any variation between the Company's adjusted basis of such property, with respect to 

each member of the Company, for federal income tax purposes and its Fair Market Value at the 

time of the contribution or deemed contribution in accordance with Section 704( c) of the Code 

and the Treasury Regulations promulgated thereunder. Such allocations shall be made in such 

manner and utilizing such permissible tax elections as determined in good faith by the Tax 

Matters Member, following consultation with the Initial Member. In the event of a revaluation 

of Company Property pursuant to the definition of Book Value, subsequent allocations of 

income, gains, losses or deductions with respect to such Company Property shall take account of 

any variation between the Book Value and Fair Market Value of such Company Property, as so 

determined from time to time, in accordance with Section 704( c) of the Code and the Treasury 

Regulations promulgated thereunder. Such allocations shall be made in such manner and 

utilizing such permissible tax elections as determined in good faith by the Tax Matters Member, 

following consultation with the Initial Member. 

(c) Capital Accounts Not Affected. Allocations pursuant to this Section 6.3 

are solely for federal, state and local tax purposes and shall not affect, or in any way be taken 

into account in computing, any Member's Capital Account or allocable share of Net Income (or 

items thereof) or Net Loss (or items thereof). 

(d) Tax Allocations Binding. The Members acknowledge that they are aware 

of the tax consequences of the allocations made by this Section 6.3 and hereby agree to be bound 

by the provisions of this Section 6.3 in reporting their respective shares of items of Company 

income, gain, loss, deduction and expense. 

6.4. Determinations by Tax Matters Member. All matters concerning the computation 

of the Capital Accounts, the allocation of items of Company income, gain, loss, deduction and 

32 

SFR Venture 2011~1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
expense and the adoption of any accounting procedures not expressly provided for by the terms 

of this Agreement shall be determined by the Tax Matters Member in good faith, following 

consultation with the Initial Member. Following such consultation, such determinations shall be 

final and conclusive as to all the Members. Without in any way limiting the scope of the 

foregoing, if and to the extent that, for income tax purposes, any contribution to or distribution 

by the Company or any payment by any Member or by the Company is recharacterized, the Tax 

Matters Member may, in good faith following consultation with the Initial Member, specially 

allocate items of Company income, gain, loss, deduction or expense and/or make correlative 

adjustments to the Capital Accounts of the Members in a manner so that the net amount of 

income, gain, loss, deduction and expense realized by each relevant party (after taking into 

account such special allocations) and the net Capital Account balances of the Members (after 

taking into account such special allocations and adjustments) shall, as nearly as possible, achieve 

the fundamental purpose of Section 6.2(a), such that the Capital Account balances correspond to 

the amounts distributable to the Members, as if such recharacterization had not occurred. 

6.5. Priority of Payments. Each calendar month the amounts deposited in the 

Distribution Account under the Custodial and Paying Agency Agreement shall be distributed by 

the Paying Agent in the order of the Priority of Payments; provided, however, that for the 

avoidance of doubt, to the extent amounts are available for distribution to the Members with 

respect to their respective LLC Interests (such available amounts, the "Distributable Cash"), 

such Distributable Cash shall be distributed to the Members in accordance with Section 6.6 

below. 

6.6. Distributions. 

(a) No Right to Withdraw. No Member shall have the right to withdraw 

capital or demand or receive distributions or other returns of any amount in its Capital Account, 

except as expressly provided in this Agreement. 

(b) Ordinary Distributions. 

(i) Timing. Distributable Cash, if any, shall be distributed to the 

Members on a monthly basis by the Paying Agent out of the Distribution Account in the manner 

set forth in the Custodial and Paying Agency Agreement; provided, however, that the Manager 

shall instruct the Paying Agent as to how such distributions are to be allocated as between the 

Initial Member and the Private Owner based on Section 6.6(b)(ii) below (which instructions shall 

be included in one or more reports to be provided to Paying Agent in accordance with 

Section 7.4 (and Section 3(b) of the Reporting and Access Schedule). 

(ii) Distributions of Distributable Cash. Each distribution of 

Distributable Cash shall be made to the Members as follows: 60% to the Initial Member and 40% 

to the Private Owner. 

(c) Restrictions on Distributions. The foregoing provisions of this Article VI 

to the contrary notwithstanding, no distribution shall be made if such distribution would violate 

any contract or agreement to which the Company is then a party or any Law or directive of any 

Governmental Authority then applicable to the Company. 

33 

SFR Venture 2011~1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
(d) Withholding. Notwithstanding any other provision of this Agreement, the 

Manager is authorized to take any action that it determines to be necessary or appropriate to 

cause the Company to comply with any foreign or United States federal, state or local 

withholding requirement with respect to any allocation, payment or distribution by the Company 

to any Member or other Person. All amounts so withheld shall be treated as distributions to the 

applicable Members under the applicable provisions of this Agreement. If any such withholding 

requirement with respect to any Member exceeds the amount distributable to such Member under 

the applicable provisions of this Agreement, or if any such withholding requirement was not 

satisfied with respect to any amount previously allocated or distributed to such Member, such 

Member and any successor or assignee with respect to such Member's LLC Interest hereby 

agrees to indemnify and hold harmless the Manager and the Company for such excess amount or 

such withholding requirement, as the case may be. 

(e) Record Holders. Any distribution of Company Property, whether pursuant 

to this Article VI or otherwise, shall be made only to Persons that, according to the books and 

records of the Company, were the holders of record of LLC Interests on the date determined by 

the Manager as ofwhich the Members are entitled to any such distribution. 

(t) Final Distribution. The Final Distribution shall be made in accordance 

with the provisions of Section 9.2. 

ARTICLE VII 

Accounting, Reporting, Taxation, Business Plans and Verification 

7 .1. Fiscal Year. The books and records of the Company shall be kept on an accrual 

basis and the fiscal year of the Company shall commence on January 1 and end on December 31 

of each year. 

7.2. Maintenance of Books and Records. The Manager shall cause the Company to 

maintain, retain, and allow access to books and records in accordance with, and shall otherwise 

comply with the provisions set forth in, Section 1 of the Reporting and Access Schedule, which 

Section 1 is hereby incorporated by reference. 

7.3. Financial Statements. The Manager shall prepare and deliver (or cause applicable 

preparation and delivery ot) the financial statements and other items required by, and shall 

otherwise comply with the provisions set forth in, Section 2 of the Reporting and Access 

Schedule, which Section 2 is hereby incorporated by reference. 

7.4. Additional Reporting and Notice Requirements; Audits. The Manager shall 

prepare and deliver (or cause applicable preparation and delivery ot) the reports, certificates, 

notices, and other information required by, shall, and shall cause the Servicer and each 

Subservicer to grant to the Initial Member (and other applicable Persons) the audit and inspection 

rights in accordance with, and shall otherwise comply with the provisions set forth in, Section 3 

of the Reporting and Access Schedule, which Section 3 is hereby incorporated by reference. In 

addition to the foregoing, the Manager shall provide or cause to be provided to the Initial 

Member, all reports, information (financial or otherwise), certificates and other documents 

required to be provided by the Company pursuant to the Reimbursement, Security and Guaranty 

34 

SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
Agreement, or by the Servicer under the Servicing Agreement. All rights of the Initial Member 

pursuant to the foregoing are in addition to, and not in limitation of, the rights of the Members 

under Section 18-305(a) of the Act. Section l8-305(c) of the Act shall not apply in relation to 

the Initial Member. 

7.5. Designation of Tax Matters Member. The Private Owner is hereby designated as 

the "Tax Matters Member" under Section 6231(a)(7) of the Code and under other similar Laws 

of other relevant jurisdictions, to manage, in consultation with the Initial Member, administrative 

tax proceedings conducted at the Company level by the Internal Revenue Service or other Tax 

authorities with respect to Company matters. Each Member expressly consents to such 

designation and agrees that, upon the request of the Tax Matters Member, it will execute, 

acknowledge, deliver, file and record at the appropriate public offices such documents as may be 

necessary or appropriate to evidence such consent. The Tax Matters Member is specifically 

directed and authorized to take whatever steps the Tax Matters Member in its sole and absolute 

discretion deems necessary or desirable to perfect such designation, including filing any forms or 

documents with the Internal Revenue Service (or other Tax authorities) and taking such other 

action as may from time to time be required under the Code, Treasury Regulations or other 

Laws. The Tax Matters Member shall keep the other Members fu.lly informed as to any Tax 

audits of the Company, including promptly providing the other Members with copies of any 

correspondence from any Taxing authority and permitting the other Member to participate in any 

conferences or meetings with any Taxing authority and in any subsequent administrative or 

judicial proceedings. The Tax Matters Member shall have the authority, following consultation 

with the Initial Member, to make any Tax elections on behalf of the Company permitted to be 

made, including the election pursuant to Section 754, under any section of the Code or the 

Treasury Regulations promulgated thereunder or under other Laws. In the event the Company 

may be deemed to be a "small partnership" as described in Section 623l(a)(l)(B), each Member 

consents to the Company's electing to be treated as a partnership to which the provisions of Code 

Section 6221 et. seq. apply (thereby electing to have Code Section 623l(a)(l)(B)(i) not apply). 

The Initial Member may, at any time following the occurrence and during the continuation of an 

Event of Default, remove the Private Owner as the Tax Matters Member, appoint itself (or any 

other willing Member at the time) as the Tax Matters Member, and serve (or cause such other 

Member to so serve) in such capacity, provided that such removal shall not relieve the Private 

Owner as Tax Matters Member of any obligations or liabilities under this Agreement or any 

other Transaction Document arising out of, relating to, occurring in connection with, or required 

to have been paid or performed by, the Private Owner as the Tax Matters Member in its capacity 

as such. 

7.6. Tax Information. 

(a) Within ninety days after the end of each Fiscal Year, the Tax Matters 

Member shall send, or cause to be sent to, each Person who was a Member at any time during the 

Fiscal Year then ended a Schedule K-1 and such Company tax information as the Tax Matters 

Member reasonably believes shall be necessary for the preparation by such Person of its United 

States federal, state and local tax returns in accordance with any Law. Such information shall 

include a statement showing such Person's share of distributions, income, gain, loss, deductions 

and expenses and other relevant items of the Company for such Fiscal Year. Promptly upon the 

35 

SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
request of any Member (or any former Member, for tax years during which such Person was a 

Member), the Tax Matters Member will furnish to such Member (or former Member): 

(i) United States federal, state and local income tax returns or 

information returns, if any, filed by the Company; and 

(ii) at the sole cost and expense of the requesting Member, such other 

information as such Member may reasonably request for the purpose of applying for refunds of 

withholding taxes. 

(b) The Manager shall prepare and deliver, or cause the Company to prepare 

and deliver, together with delivery to the Initial Member of the annual financial statements 

pursuant to Section 7.3 (and Section 2(a) of the Reporting and Access Schedule), a report which 

shall specify, for each Due Period and for such annual reporting period, the information with 

respect to each Asset that is sold or otherwise disposed of by the Company so as to enable the 

Company (and each Member) to comply with allocation provisions of Section 704(c) of the 

Code, as determined as of the close of business on the applicable Determination Date and 

certified by an authorized representative (who shall be the chief financial officer (or an 

equivalent officer)) ofthe Company. 

7.7. Business Plans. As promptly as possible, but in no event later than the time 

periods set forth herein (and, as applicable, with current information as of the month most 

recently ended prior to delivery thereof) the Manager shall deliver to the Initial Member written 

plans detailing the strategy to be used by it in managing and disposing of the Assets (and the 

Ownership Entities) for achieving the Company's purposes with respect thereto, in conformance 

with the Servicing Standard, based, to the extent appropriate, on information gathered by the 

Company with respect to the Assets (each, together with any updates thereto, a "Business 

Plan"), which shall include (i) individual Business Plans (each, an "Asset Level Business 

Plan") for each of the twenty-five largest Assets based on their Unpaid Principal Balance as of 

the Cut-Off Date (as set forth on the Asset Schedule), and (ii) a consolidated Business Plan 

covering all Assets (a "Consolidated Business Plan"). Such initial Asset Level Business Plans 

shall be delivered not more than sixty days after the Closing Date, and such initial Consolidated 

Business Plan (including updated Asset Level Business Plans) shall be delivered no later than 

January 31,2012, reflecting information that is current as of December, 31 2011. With respect 

to the first such Asset Level Business Plans and Consolidated Business Plan, the Manager shall 

meet with the Initial Member as reasonably requested by the Initial Member from time to time 

during the thirty Business Days following the Initial Member's receipt of the same, or such later 

date as requested by the Initial Member, to review and discuss such Asset Level Business Plans 

and Consolidated Business Plan, including changes thereto suggested by the Initial Member. 

Within thirty Business Days following expiration of such review period, the Manager will 

deliver to the Initial Member a final version of such Asset Level Business Plans and 

Consolidated Business Plan reflecting such changes as the Manager considers to be appropriate 

in light of its discussions with the Initial Member during such review period. The Manager shall 

thereafter review and revise each Business Plan as the circumstances may require, and in any 

event provide periodic updates to such Business Plans (and for each such update to the Asset 

Level Business Plans, the same shall cover the twenty-five largest Assets based on their Unpaid 

Principal Balance as of the time of such update) to the Initial Member, on January 31 (current as 

36 

SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
of December 31 of the immediately preceding year) and July 31 (current as of June 30 of such 

year) of each year, commencing in July of 2012, with each such periodic update to be delivered 

as part of the Monthly Reports due at such time pursuant to Section 7.4 (and Section 3(b) of the 

Reporting and Access Schedule). With respect to each such Business Plan (including any update 

thereto), upon reasonable notice by the Initial Member, the Company shall make its personnel 

who are familiar with such Business Plans available during normal business hours for the 

purposes of discussing such Business Plans with representatives of the Initial Member and 

responding to questions therefrom (and, as applicable, revising the same to reflect such changes 

as the Manager considers to be appropriate in light of such discussions with the Initial Member). 

(a) Each Business Plan (including any update thereto) will set forth a strategy 

(consistent with any restrictions set forth in this Agreement and the other Transaction Documents, 

except to the extent that this Agreement or any such other Transaction Document, as the case may 

be, expressly contemplates that such Business Plan (including any update thereto) may propose 

deviations from any such restriction) for the disposition of the Assets addressed thereby which 

strategy may consist of one or more of the following: (i) the pay-off of Assets at a discount; (ii) 

modifications of the related note and/or mortgage, including reductions in the mortgage loan 

interest rate, reductions in the principal balance and rescheduling principal payments; (iii) 

foreclosure upon the related Collateral (or acquisition thereof by deed in lieu of foreclosure) and 

subsequent sale thereof; (iv) assumptions of Assets by new borrowers; ( v) repairs to and, if 

applicable, completion of construction of the related Collateral, with a view towards selling such 

Collateral or the Asset secured thereby; (vi) sale of an Asset, either singly or in pools, before or 

after restructuring; and (vii) any other method of work-out, rehabilitation and disposition 

consistent with the Servicing Standard and other general duties of the Manager specified in this 

Agreement. 

(b) Each Business Plan (including any update thereto) will set forth a strategy 

(consistent with any restrictions set forth in this Agreement and the other Transaction 

Documents, except to the extent that this Agreement or any such other Transaction Document, as 

the case may be, expressly contemplates that such Business Plan (including any update thereto) 

may propose deviations from any such restriction) for the disposition of each related Acquired 

Property which strategy may consist of one or more of the following: (i) the sale or leasing of the 

Acquired Property in whole or in parts, or in pools; (ii) making repairs to, the rehabilitation or 

improvement of, and, if applicable, the completion of construction of, the Acquired Property, or 

making changes to the Acquired Property so that it may be used for uses other than its current 

use, with a view toward selling the Acquired Property; (iii) continued leasing or sales activity 

with respect to the Acquired Property available for leasing or sale (in whole or in part) at the 

time it is transferred to an Ownership Entity; and (iv) maintenance, landscaping and general 

upkeep of the Acquired Property. To the extent any such Business Plan (and related strategy) 

includes any permitted construction or development expenses to be funded by the Company 

(other than pursuant to Required Funding Draws), such Business Plan (and any update thereto) 

shall include a description of such construction or development expenses in reasonable detail 

(including the related budget and timeline). For avoidance of doubt, in no event shall delivery of 

any information pursuant to a Business Plan (or any update thereto) be deemed to constitute 

delivery or approval with respect to any Asset Level Development Plan. 

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(c) Each Business Plan (including any update thereto) shall contain the 

Company's estimate (or determination, as applicable) of (i) the present value of the net amount 

that is recoverable with respect to each related Asset (including, with respect to all related 

Acquired Property, the Net Fair Value thereof), (ii) with respect to all Acquired Property and 

Mortgaged Property included in any Asset covered by such Business Plan, in the event such 

Acquired Property or Mortgaged Property includes more than one parcel of real property (or 

would otherwise potentially be sold by the Company in severable parts), the applicable Release 

Price for each such parcel (or other severable part) of such Acquired Property and Mortgaged 

Property, and (iii) projected Working Capital Expenses and any other permitted expenditures 

with respect to each such Asset (including any Acquired Property), and, in each case including in 

reasonable detail the manner of calculation of each of the foregoing. The Consolidated Business 

Plan (including any update thereto) shall include projected financials including statements of 

income, assets, and cash flows for the Company (and, for purposes of clarification, the 

information required pursuant to the immediately preceding sentence with respect to all Assets). 

Such cash flow projections shall, for the Consolidated Business Plan and each update thereto, 

include an Excel model of projected cash flows, as of June 30 and December 31 of each year (or, 

in the case of the initial Consolidated Business Plan, as of the date of preparation and delivery 

thereof) and covering the period through the tenth anniversary of the Closing Date, on a monthly 

basis for the upcoming twenty-four months and not less than a quarterly basis thereafter, 

including projected cash inflows (including projected Asset Proceeds, Excess Working Capital 

Advances, projected cash outflows (including projected Servicing Expenses, Required Funding 

Draws and other Working Capital Expenses)), projected Working Capital Reserve levels, 

projected net monthly cash available for payment to the Holders, as applicable, and the amount 

and allocation of any projected distributions to the Initial Member and the Private Owner. 

(d) Each update to a Business Plan shall include descriptions and explanations 

for the largest variances to the previously reported corresponding Business Plan. Variance 

explanations shall include changes in capital expenditures for Acquired Property, protective 

advances, internal rates of return, strategy for the disposition of the Assets, actual principal and 

interest income and other collection proceeds, cash flows, projected distributions to the 

Members, and other changes in strategy or other relevant matters as compared to the previously 

reported corresponding Business Plan. 

(e) Each Business Plan (including any update thereto) will set forth the 

policies, practices and guidelines with respect to when (including how frequently) site 

inspections (of Mortgaged Property and Acquired REO Property) will be conducted, the 

procedures to be followed in conducting site inspections and the manner in which the results of 

site inspections are to be documented (including standard forms to be used in connection with 

such documentation). 

(f) Each Business Plan (including any update thereto) will set forth (i) the 

organizational structure of the Manager and its Affiliates, and (ii) the policies and procedures of 

the Manager and its Affiliates regarding the manner in which the strategies set forth in the 

Business Plan, and the determinations described in Section i(a)(ii) of the Reporting and Access 

Schedule, are determined, made, internally approved and implemented. 

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ARTICLE VIII 


Restrictions on Disposition of Private Owner Interest 


8.1. Limitations on Disposition of Private Owner Interest. Except as otherwise 

provided in this Article VIII, the Private Owner shall not, and may not, Dispose of all or any part 

of the Private Owner Interest; provided, however, that the Private Owner may (i) make a direct, 

outright transfer of its entire (but not less than its entire) Private Owner Interest if, and only if, 

(x) (A) the transferee is a single Person that is a Qualified Transferee, (B) such transferee 

delivers to the Initial Member a Purchaser Eligibility Certification and the representations and 

warranties made by such transferee therein shall be true and correct both before and after giving 

effect to such transfer of the Private Owner Interest, and (C) the Private Owner first obtains the 

prior written consent of each Required Consenting Party to such transfer, or (y) such Disposition 

is done by or at the direction of the Initial Member (with the consent of the PMN Agent) 

pursuant to Sections 3.13 or 3.14; provided, further, that it is understood that a direct or indirect 

Disposition of an interest of a third party in the Private Owner (i.e., as opposed to a Disposition 

of any nature by the Private Owner itself) does not violate this sentence (it being further 

understood that such transaction might nevertheless violate other provisions of the Transaction 

Document (such as for example Sections 8.2 or 10.1 hereof), and (ii) make a direct outright 

transfer of its right to receive the Interim Management Fee, Management Fee, or payments as set 

forth in (and subject to) Section 12.5. Transfers of the entire Private Owner Interest satisfying 

the foregoing criteria/criteria set forth in clause (i) of the preceding sentence are hereinafter 

referred to as "Permitted Dispositions." 

8.2. Change of Control. The Private Owner represents, warrants and covenants that no 

Change of Control will occur with respect to the Private Owner unless (i) it first obtains the prior 

written consent of each Required Consenting Party, and (ii) following such Change of Control, 

the Private Owner would remain a Qualified Transferee. Without limitation of the preceding 

sentence, the Private Owner will provide the Initial Member with immediate notice at the address 

specified in Section 13.6 of the occurrence of any Change of Control with respect to the Private 

Owner. 

8.3. Additional Provisions Relating to Permitted Dispositions. Except as otherwise 

expressly provided in this Section 8.3, the following provisions shall apply to each Permitted 

Disposition: 

(a) In the event the Private Owner proposes to make a Permitted Disposition, 

the Private Owner shall be required to pay any and all filing and recording fees, fees of counsel 

and accountants and other out-of-pocket costs and expenses reasonably incurred by the Initial 

Member and/or the Company in connection with such Permitted Disposition. 

(b) The transferee in a Permitted Disposition shall deliver to the Company, 

with a copy to each Required Consenting Party, an agreement, in form and substance reasonably 

satisfactory to each Required Consenting Party, by which such transferee shall (i) agree to 

become a party to and be bound by each of this Agreement, the Custodial and Paying Agency 

Agreement, the Agreement of Definitions, the Servicing Agreement (if such transferee is also the 

Manager, and unless, in connection with such Permitted Disposition, the Servicing Agreement is 

terminated in accordance with its terms with a full release of claims by the Servicer and any 

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terminating Subservicer and with execution of a replacement Servicing Agreement with such 

Servicer or a replacement Servicer in a manner acceptable to each Required Consenting Party), 

and each other Transaction Document to which the Private Owner is a party (including, if the 

transferor Member, prior to such transfer, also was the Manager, to which it is a party in its 

capacity as the Manager (or in its individual capacity)) as the "Private Owner" (and/or as the 

"Manager" as applicable), (ii) agree (if the transferor Member, prior to such transfer, also was 

the Manager) to be appointed as the "Manager", and without limitation of the generality of the 

foregoing, agree to be bound by the other terms of Section 8.4 hereof, and (iii) assume and agree 

to perform when due all of the obligations of the "Private Owner" and (if the transferor Member, 

prior to such transfer, also was the Manager) the "Manager" under each of this Agreement, the 

Custodial and Paying Agency Agreement, the Agreement of Definitions, the Servicing 

Agreement (or applicable replacement Servicing Agreement) and each other Transaction 

Document to which the Private Owner (including, if the transferor Member, prior to such 

transfer, also was the Manager, in its capacity as the Manager (or in its individual capacity)) is a 

party, and (iv) represent and warrant that it complies with the requirements set forth in Article X 

and make all the other representations and warranties of "Private Owner" set forth in this 

Agreement. 

(c) In connection with each Permitted Disposition, the Private Owner and the 

transferee shall deliver to the Company, the PMN Agent and the Initial Member such other 

documents and instruments as the PMN Agent or Initial Member reasonably may request and 

which are required to effect the Permitted Disposition and substitute the transferee as a Member. 

8.4. Effect of Permitted Dispositions. 

(a) Upon consummation of any Permitted Disposition: 

(i) the transferee shall be admitted as a member of the Company and 

be deemed to be a party to this Agreement as the "Private Owner" and, if the transferor Member, 

prior to such transfer, also was the Manager, such transferee shall be appointed as the Manager 

(in the place of the transferor Member); 

(ii) the transferred LLC Interest shall continue to be subject to all the 

provisiOns of this Agreement, and the transferee Member shall have the same status as the 

Private Owner had at the time of consummation of such Permitted Disposition and, without 

limiting the generality of the foregoing, any outstanding breach, misrepresentation, violation or 

default (with respect to this Agreement or any other Transaction Document) by any direct or 

indirect predecessor to the transferee as the Member, or by any Affiliate of any such predecessor 

Member, shall be deemed to constitute an outstanding breach, misrepresentation, violation or 

default as the case may be, by the transferee Member; and 

(iii) subject to Section 8.4(b) and the last sentence of Section 13.8, the 

transferor Member shall cease to be a member of the Company (and accordingly, except as 

expressly otherwise provided in Section 8.4(b) or the last sentence of Section 13.8, shall cease to 

be responsible for the payment or performance of any of the obligations or liabilities under this 

Agreement ofthe Private Owner, in any capacity hereunder). 

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(b) No Permitted Disposition (and no resulting withdrawal or resignation of 

the transferor Member from the Company) shall: 

(i) relieve the transferor Member of any of the obligations or 

liabilities of the transferor Member, in any capacity, under this Agreement or any other 

Transaction Document required to have been paid or performed prior to the consummation of 

such Permitted Disposition (or of any liability it may have arising out of any breach, 

misrepresentation, violation or default by the transferor Member prior to such consummation); 

(ii) result in the termination of, relieve the transferor Member (or any 

of its Affiliates) of, or otherwise affect, any of the obligations or liabilities of the transferor 

Member, in any capacity, or its Affiliates under, any Related Party Agreement (such Related 

Party Agreements to continue in effect in accordance with their respective terms), except to the 

extent expressly provided in such Related Party Agreement; 

(iii) dissolve the Company; or 

(iv) relieve the transferor Member of any obligations, liabilities and/or 

indemnities required pursuant to Section 4.6. 

(c) The Initial Member, with the consent of the PMN Agent but otherwise in 

its discretion, can waive any provision of Sections 8.3 or 8.4(a) in the context of a transfer of the 

Private Owner Interest pursuant to Sections 3.13 or 3.14. 

8.5. Effect of Prohibited Dispositions. Any attempted or purported Disposition of the 

Private Owner Interest (or any portion thereof) not strictly in accordance with the terms of this 

Agreement shall be void ab initio and of no force or effect whatsoever. The Private Owner shall 

not be entitled, and hereby specifically waives any right, to receive Company distributions 

during (i) the period between any attempted or purported Disposition of the Private Owner 

Interest (or any portion thereof) not strictly in accordance with the terms of this Agreement and 

the express rescission of such attempted or purported Disposition by the Private Owner and (ii) 

any period when the Private Owner is in violation of Section 8.2, provided that all such omitted 

Company distributions shall (subject to Section 8.6) be made to the Private Owner (without 

interest) forthwith after the end ofthe relevant suspension period. 

8.6. Distributions After Disposition. Distributions with respect to an LLC Interest 

(including pursuant to Section 8.5) made on or after the effective date of the Permitted 

Disposition of such LLC Interest shall be made to the transferee Member with respect to such 

LLC Interest, regardless of when such distributions accrued on the books of the Company. 

8.7. Transfers By Initial Member Certain Consent Rights of the PMN Agent in 

Relation to the Initial Member. 

(a) Subject only to Section 8.7(b), but otherwise notwithstanding anything to 

the contrary contained in this Agreement, except as provided by applicable Law, there shall be 

no restriction on the Initial Member's ability to Dispose of the Initial Member Interest, directly 

or indirectly, to any Person and the Private Owner shall have no right to purchase or right-offirst-refusal in connection with any such sale; provided, however, that the Initial Member may 

41 

SFR Venture 2011~1 Structured Transaction 

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not assign the consent and voting rights associated with the Initial Member Interest to more than 

one Person (for the avoidance of doubt, except as expressly provided above, the foregoing 

restriction shall not otherwise limit the Initial Member's right to Dispose of any interest 

associated with the Initial Member Interest); and provided, further, that in the event the Initial 

Member determines to sell the Initial Member Interest through an auction process, the Private 

Owner shall be entitled to participate in such auction on the same terms that apply generally to 

other participants in the auction. At the election of the Person then constituting the "Initial 

Member" under this Agreement, the transferee in any direct Disposition of any portion of the 

Initial Member Interest shall, upon delivery to the Company, with a copy to the Private Owner 

and the PMN Agent, of an agreement by which such transferee shall agree to become a party to 

and be bound by this Agreement as the "Initial Member," be admitted as a member of the 

Company and be deemed to be a party to this Agreement as the "Initial Member", and thereupon, 

subject to last sentence of Section 13.8, the transferor Member shall cease to be a member of the 

Company (and accordingly, except as expressly otherwise provided in last sentence of 

Section 13.8, shall cease to be responsible for the payment or performance of any of the 

obligations or liabilities under this Agreement of the Initial Member). 

(b) The Initial Member may not (and in any event covenants that it will not) 

sell, transfer or assign the Initial Member Interest without the prior consent of the PMN Agent 

(which shall not unreasonably be withheld). Even if such consent is obtained, such sale, transfer 

or assigmnent may not and shall not be consummated unless and until the transferee in such 

transaction shall deliver to the PMN Agent, an agreement, in form and substance reasonably 

satisfactory to the PMN Agent, by which such transferee shall (i) agree to become a party to and 

be bound by each of this Agreement, the Reimbursement, Security and Guaranty Agreement, the 

Custodial and Paying Agency Agreement and the Agreement of Definitions as the "Initial 

Member," and (ii) assume and agree to perform when due all of the obligations of the "Initial 

Member" under each of this Agreement, the Reimbursement, Security and Guaranty Agreement, 

the Custodial and Paying Agency Agreement and the Agreement of Definitions. The preceding 

sentence of this Section 8.7(b) is subject to Section 8.7(c). The Initial Member may not (and in 

any event covenants that it will not) exercise any of its rights or remedies described in clause (i), 

ili.l, (iii), (iv) or (other than in relation to the Additional Security) ill of Section 3.13(a) hereof 

without the prior consent of the PMN Agent. This Section 8. 7(b) is solely for the benefit of the 

PMN Agent, as more fully set forth in Section 13.5(d). 

(c) Anything in this Agreement (including Sections 8. 7(a) or (hl) to the 

contrary notwithstanding, from and after the acquisition by the FDIC in its corporate capacity of 

the assets of the receivership of any Failed Bank, the FDIC in its corporate capacity, as successor 

to the FDIC in its capacity as the receiver under such receivership, automatically and without any 

further act of the parties, shall succeed to all of the rights, duties and obligations of the "Initial 

Member" hereunder. 

8.8. Resignation; Dissolution. 

(a) The Private Owner may not withdraw or resign from the Company, except 

(i) in connection with a Permitted Disposition made in accordance with the applicable provisions 

of this Article VIII or (ii) with the prior written consent of the Required Consenting Parties. 

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Amended and Restated LLC Operating Agreement 
(b) The Private Owner covenants that it shall not allow a Dissolution Event to 

occur with respect to itself. 

(c) Section 18-304 of the Act shall not apply to the Company. Nothing in this 

Section 8.8(c) shall limit the terms of Section 9.1 hereof. 

(d) Except as is otherwise expressly provided in this Agreement, no Member 

shall be entitled to receive any payment pursuant to Section 18-604 ofthe Act. 

8.9. Applicable Law Withdrawal. If, as a result of applicable Law, the ownership of 

an LLC Interest by a Member becomes illegal or is likely to become illegal or the applicable 

Law more likely than not requires divestiture of such Member's LLC Interest, or the applicable 

Law would require the Company to register as an investment company under the Investment 

Company Act, then the Manager and such Member shall use their respective commercially 

reasonable efforts to avoid a violation of any such applicable Law by such Member or the need 

for the Company to register as an investment company. These steps may include, depending on 

the provisions of such applicable Law, (i) arranging for the sale of the Member's LLC Interest to 

a third party upon terms reasonably satisfactory to the Member in a transaction that complies 

with Articles VIII and X, (ii) making any appropriate applications to the relevant Governmental 

Authority, (iii) prohibiting such Member from making further Capital Contributions, and 

converting its LLC Interest into a special interest with no voting or similar rights but with only 

an economic right (identical to its prior rights as a Member), or (iv) permitting the Member to 

withdraw from the Company in exchange for a "payment" to such Member equal to the value of 

its LLC Interest at the time of withdrawal, such value to be determined by a third party appraiser 

mutually agreeable to the Manager and all Members. The aforesaid "payment" shall be made in 

cash unless the Manager determines that the payment in cash would be economically detrimental 

to the Company, in which case such payment may be made in kind, subject to the applicable 

Law. The timing of any such withdrawal must be mutually agreeable to the withdrawing 

Member and the Manager taking proper account of the effective date of the applicable Law or 

registration requirement that is the basis for the withdrawal or other remedy provided herein and 

the need of the Manager for a reasonable period of time to find a solution to the illegality or 

requirement for divestiture or renegotiation. Such illegality, divestiture or registration 

requirement must be established by (x) an opinion of counsel (which counsel shall be reasonably 

satisfactory to the Manager and the Initial Member) substantially to the effect that the ownership 

of the LLC Interest more likely than not will result in such illegality or requirement for 

registration or divestiture or (y) a ruling or order from a Governmental Authority. 

ARTICLE IX 


Dissolution and Winding-Up of the Company 


9.1. Dissolution. A dissolution of the Company shall take place upon the first to occur 

of the following: 

(a) the agreement by all Members to dissolve the Company (it being 

understood and agreed that neither Member, acting alone, shall have the right unilaterally to 

dissolve the Company); 

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(b) the sale of the Company Property (other than cash and cash equivalent 

instruments) as an entirety or substantially as an entirety; 

(c) notice to such effect to the Private Owner from the Initial Member at any 

time after the occurrence of a Dissolution Event or an Insolvency Event with respect to the 

Private Owner or any Person that Controls the Private Owner; or 

(d) exercise of the Clean-Up Call and liquidation of all remaining Assets and 

Acquired Property of the Company in accordance with Section 12.20. 

9.2. Winding-Up Procedures. If a dissolution of the Company pursuant to Section 9.1 

occurs, subject to the Company's compliance with its obligation under the other agreements to 

which it is a party, the other terms and conditions of this Agreement or the other Transaction 

Documents, the Manager shall proceed as promptly as practicable to wind up the affairs of the 

Company in an orderly and businesslike manner. A final accounting shall be made by the 

Manager. As part of the winding up of the affairs of the Company, the following steps will be 

taken: 

(a) The Company Property shall be sold except to the extent that some or all 

of the assets of the Company are retained by the Company for distribution to the Members as 

hereinafter provided. 

(b) The Company shall comply with Section 18-804(b) of the Act. 

(c) Distributions of the assets of the Company after a dissolution of the 

Company shall be conducted as follows: 

(i) first, to creditors, but excluding the Members who are creditors 

(other than the Initial Member (to the extent it continues to hold the Purchase Money Notes)), to 

the extent otherwise permitted by Law (and, to the extent permitted, in accordance with the 

Priority of Payments), in satisfaction of liabilities of the Company (whether by payment or the 

making of reasonable provision for payment thereof); 

(ii) second, to the Members or former Members who are creditors, to 

the extent otherwise permitted by Law, in satisfaction of liabilities of the Company (whether by 

payment or the making of reasonable provision for payment thereof) other than liabilities for 

which reasonable provision for payment has been made and liabilities for distributions to the 

Members and former Members under Section 18-601 of the Act; 

(iii) third, to the Members and former Members m satisfaction of 

liabilities (if any) for distributions under Section 18-601 of the Act; and 

(iv) finally, to the Members in the manner set forth in Section 6.6(b). 

(d) Upon dissolution, the Manager, may, with the consent of all the Members, 

(i) liquidate all or a portion of the Company Property and apply the proceeds of such liquidation 

in the manner set forth in Section 9.2(c) and/or (ii) hire independent appraisers to appraise the 

value of Company Property not sold or otherwise disposed of or determine the Fair Market 

44 

SFR Venture 2011~1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
Value of such assets, and allocate any unrealized gain or loss determined by such appraisal to the 

Members' respective Capital Accounts as though the properties in question had been sold on the 

date of distribution and, after giving effect to any such adjustment, distribute said assets in the 

manner set forth in Section 9 .2( c), provided that the Manager shall in good faith attempt to 

liquidate sufficient Company Property to satisfy in cash the debts and liabilities described in 

Section 9.2. If a Member shall, upon the advice of counsel (obtained at its own expense), 

determine that there is a reasonable likelihood that any distribution-in-kind of an asset would 

cause such Member to be in violation of any Law, such Member and the Manager shall each use 

its best efforts to make alternative arrangements for the sale or transfer into an escrow account of 

any such distribution-in-kind on mutually agreeable terms. 

9.3. Termination of the Company. Upon the dissolution of the Company and the 

completion of the winding up process set forth in Section 9.2, the Manager (or such other Person 

or Persons as the Act may require or permit) shall cause the cancellation of the Certificate and 

any filings required by clause (iii) of Section 4.3 and shall take (or cause to be taken) such other 

actions as may be necessary to terminate the Company. 

ARTICLE X 


Qualified Transferees 


1 0.1. Qualified Transferees. The Private Owner (including, for the avoidance of doubt, 

its Successors), certifies, represents and warrants as follows, and covenants that it shall at all 

times be in compliance with, and (without limitation of the foregoing) will not enter into any 

transaction, or take (or omit to take) any other action, that would result in it ceasing to be in 

compliance with, the following (and any proposed transferee of the Private Owner Interest in 

compliance with the following shall be deemed a "Qualified Transferee"): 

(a) Organization; Good Standing; Licenses. Such Member (i) is a Special 

Purpose Entity duly organized, validly existing and in good standing under the Laws of the state 

of its organization, (ii) has qualified or will qualify to do business as a foreign corporation, 

partnership or other entity and will remain so qualified, and is and will remain in good standing, 

in each jurisdiction in which the character of its properties or the nature of its activities makes 

such qualification necessary and in which failure to so qualify would have a material adverse 

effect upon such Member or its ability to perform its obligations hereunder, (iii) has full power to 

own its property, to carry on its business as presently conducted, and to enter into and perform its 

obligations under this Agreement, and (iv) has all licenses or other governmental approvals 

necessary to perform its obligations hereunder. As of the Closing Date (or, in the case of any 

Successor to the Private Owner, as of the date such Member first became a Member of the 

Company), such Member is in compliance with Section 8.2 hereof. 

(b) Authorization; No Violation. The execution and delivery by such Member 

of this Agreement and the consummation of the transactions contemplated hereby have been 

duly and validly authorized by all necessary action. Neither the execution and delivery of this 

Agreement, nor the consummation of the transactions herein contemplated, nor compliance with 

the provisions hereof, will conflict with or result in a breach of, or constitute a default under, 

(i) any of the provisions of any Law binding on such Member or its properties, (ii) the 

constituent documents of such Member, or (iii) any of the provisions of any indenture, mortgage, 

45 

SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
contract or other instrument to which such Member is a party or by which it is bound or result in 

the creation or imposition of any Lien upon any of its property pursuant to the terms of any such 

indenture, mortgage, contract or other instrument. 

(c) Govermnental Approvals. All actions, approvals, consents, waivers, 

exemptions, variances, franchises, orders, permits, authorizations, rights and licenses required to 

be taken, given or obtained, as the case may be, by or from any Governmental Authority or 

agency that are necessary in connection with the execution and delivery by such Member of this 

Agreement and the consummation of the transactions contemplated hereby and the performance 

of its obligations hereunder, have been duly taken, given or obtained, as the case may be, are in 

full force and effect, are not subject to any pending proceedings or appeals (administrative, 

judicial or otherwise) and either the time within which any appeal therefrom may be taken or 

review thereof may be obtained has expired or no review thereof may be obtained or appeal 

therefrom taken. 

(d) No Litigation. On the date such Member becomes a party to this 

Agreement, there is no action, suit, proceeding or investigation pending or threatened against 

such Member before any Govermnental Authority. 

(e) No Violation of Orders, Decrees. etc. Such Member is not in default with 

respect to any order or decree of any Governmental Authority or in violation of any Law. 

(f) Third Party Consents. No consents, approvals, or waivers of, or 

notifications to, stockholders, creditors, lessors or other nongovernmental Persons are required to 

be obtained or made by such Member in connection with the execution and delivery of this 

Agreement and the consummation of all the transactions herein contemplated and the 

performance of its obligations hereunder. 

(g) Owners Accredited Investors. All of the equity owners of such Member 

are "accredited investors," as that term is defined in Rule 501 under the Securities Act. 

(h) Knowledge and Experience. Such Member, either by itself or through its 

advisers and principals, has such knowledge and experience in the origination, servicing, sale 

and/or purchase of performing and non-performing or distressed loans, including construction 

loans and loans secured by residential and commercial properties, as well as financial and 

business matters, as to enable such Member to utilize the information made available to it with 

respect to the LLC Interest acquired by it and the Assets to evaluate the merits and risks of a 

purchase of the Private Owner Interest and, indirectly, the Assets, and to malce an informed 

decision with respect thereto. 

(i) Economic Risks. Such Member acknowledges, understands and 

represents that it is able to bear the economic risks associated with the acquisition and ownership 

of the Private Owner Interest and, indirectly, the Assets, including the risk of a total loss of its 

investment in the Company and, indirectly, the Assets and/or the risk that it may be required to 

hold the Private Owner Interest and, indirectly, the Assets for an indefinite period oftime. 

46 

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G) No Representations. Such Member hereby acknowledges that, except as is 

otherwise expressly provided in this Agreement, the Private Owner Interest Sale Agreement, or 

the Contribution Agreement, none of the Initial Member or the FDIC or any of their respective 

Related Persons, makes or has made any representation or warranty regarding the Company, the 

LLC Interests or the Assets or the value of any Collateral. 

(k) Due Diligence. Such Member acknowledges and agrees that, whether or 

not information is available with respect to the LLC Interests or the Assets and whether or not it 

chooses to review any information that is or was made available to it regarding the LLC Interests 

or the Assets, such Member, by itself or through its advisers or principals, has the ability and 

shall be responsible for making its own independent investigation and evaluation of the LLC 

Interests and the Assets and the economic, credit or other risks involved in an acquisition of the 

Private Owner Interest and, indirectly, the Assets. Except as is otherwise expressly provided in 

this Agreement, none of the Initial Member or the FDIC or any of their respective Related 

Persons, makes or has made any representation or warranty as to the completeness or accuracy of 

any information provided. 

(I) No Securities. Such Member acknowledges and agrees that (i) neither the 

offer nor the sale of the Private Owner Interest (and, indirectly, the Assets) is intended to 

constitute an offer or sale of a "security" within the meaning of the Securities Act or any 

applicable federal or state securities Laws, (ii) no inference that any of the LLC Interests or the 

Assets is a "security" under such federal or state securities Laws shall be drawn from any of the 

certifications, representations or warranties made by any Person in this Agreement, (iii) it is not 

contemplated that any filing will be made with the Securities and Exchange Commission or 

pursuant to the "Blue Sky" or securities Laws of any jurisdiction, and (iv) if any of the LLC 

Interests or the Assets is a security, such may not be resold or otherwise transferred by such 

Member except in accordance with any and all applicable securities and "Blue Sky" Laws. 

(m) Resales. Such Member is acquiring the Private Owner Interest (and, 

indirectly, the Assets) for its own account and not with a view toward resale in a distribution 

within the meaning of the Securities Act. 

(n) Resales in Compliance with Law. Such Member will not (i) offer, pledge, 

sell or otherwise Dispose of the Private Owner Interest (or any interest therein) or any Asset (or 

any interest therein or evidence thereof) to, (ii) solicit any offer to buy or accept a transfer, 

pledge or other Disposition of the Private Owner Interest (or any interest therein) or any Asset 

(or any interest therein or evidence thereof) from, or (iii) otherwise approach or negotiate with 

respect to the Private Owner Interest (or any interest therein) or any Asset (or any interest therein 

or evidence thereof) with, any Person in any manner, or take any other action, that would (A) not 

comply with Article VIII, or (B) render the transfer to such Member of the Private Owner 

Interest or any interest in any Asset a violation of any Law relating to the issuance, regulation, 

registration or disposition of securities, nor will it authorize any Person to so act, in any manner 

with respect to the Private Owner Interest (or any interest therein) or any Asset (or interest 

therein or evidence thereof). 

(o) Acquisition in Compliance with Law. Such Member's acquisition of the 

Private Owner Interest and the resulting investment in the Assets will comply with all applicable 

47 

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Laws, including any and all Laws and/or restrictions imposed on resale of the Private Owner 

Interest and the Assets by federal and state securities or "Blue Sky" Laws. 

(p) Independent Evaluation. Such Member has made an independent 

evaluation of the Company and its assets (including the Assets and related Asset files and/or any 

electronic data made available to it pertaining to the Assets held by the Company). Such 

Member also has conducted such other investigations as it deems appropriate, including searches 

of Uniform Commercial Code, title, court, bankruptcy, Tax and other public records. Such 

Member agrees and represents that it is entering into this Agreement solely on the basis of its 

own investigations and its judgment as to the value of the Private Owner Interest and the nature, 

validity, enforceability, collectability and value of the Assets and all other facts material to their 

ownership, including the legal matters and risks relating to collection and enforcement, and the 

performance of any obligations under any of the Assets in any jurisdiction. Such Member 

further acknowledges that no Related Person of the Initial Member, or the FDIC has been 

authorized to make any statements or representations other than those specifically contained in 

this Agreement or the Contribution Agreement. Such Member has consulted with its own 

counsel, accountants and other advisors as to the legal, tax, business, financial and related 

aspects of its ownership of the LLC Interest and no representation, warranty or advice has been 

provided as to such matters by the Initial Member, the FDIC or any of their Related Persons. 

(q) Embargoed Person. (i) No consideration that such Member or any of its 

Affiliates contributes hereunder or under the other Transaction Documents in connection with 

any transaction regarding any assets has been derived from or related to any activity that is 

deemed criminal under United States Law; (ii) neither such Member nor any of its Affiliates or 

Direct Owners is an Embargoed Person; (iii) neither such Member nor any of its Affiliates or 

Direct Owners engages in any dealings or transactions, or is otherwise "associated with" (as 

defined in 31 C.F.R. 594.101, et seq.), any Embargoed Person; and (iv) if and to the extent such 

Member or any of its Affiliates is required by Law to maintain an anti-money laundering 

compliance program under applicable anti -money laundering Laws and regulations, including 

the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept 

and Obstruct Terrorism Act of 2001 (Public Law 107-56), such compliance programs are 

currently being maintained. The foregoing certifications, representations and warranties shall be 

based upon a due inquiry and investigation; provided, however, that for purposes of determining 

whether any of the same with respect to indirect ownership are true, such Member shall not be 

required to make an investigation into the ownership of publicly-traded securities (including 

securities of open-end investment companies registered under the Investment Company Act) or 

the ownership of assets by a collective investment fund that holds assets for employee benefit 

plans or retirement arrangements. 

(r) ERISA Plan Asset. The assets of such Member (including any successor 

to or transferee of such Member) are not deemed to be ERISA Plan Assets. 

(s) Purchaser Eligibility. Each of such Member, each Person comprising such 

Member's Specified Parent and each Affiliate of each Person comprising such Member's 

Specified Parent is and remains capable of truthfully making the representations and warranties 

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Amended and Restated LLC Operating Agreement 
in the Purchaser Eligibility Certification (for the avoidance of doubt, as if it were a "Prospective 

Purchaser"). 

(t) Qualified Purchaser. Such Member is a "qualified purchaser" within the 

meaning of Section 3( c )(7) of the Investment Company Act. 

ARTICLE XI 


Manager Liability 


11.1. Liability of Manager. 

(a) Except as otherwise specifically provided in this Agreement (including in 

the other subsections of this Section 11.1), the duties (including fiduciary duties) and obligations 

owed to the Company and the Initial Member by the Manager shall be as provided in 

Section 3 .l(b) hereof. 

(b) The Manager may rely, and shall be protected in acting or refraining from 

acting, upon any resolution, certificate, statement, instrument, opinion, report, notice, request, 

consent, order, bond, debenture or other paper or document reasonably believed by it to be 

genuine and to have been signed or presented by the proper party or parties. 

(c) The Manager may consult with legal counsel, accountants, appraisers, 

management consultants, investment bankers and other consultants and advisers selected by it, 

and any act taken or omitted to be taken in reliance upon the opinion of such Persons as to 

matters that the Manager reasonably believes to be within such Person's professional or expert 

competence shall be conclusively presumed to have been done or omitted in good faith and in 

accordance with such opinion. 

(d) The Manager shall not be liable to the Company or the Members for its 

good faith reliance on the provisions of this Agreement. 

(e) The limitations and exculpation afforded by each provision of this 

Section 11.1 are cumulative and not exclusive. Nothing in this Section 11.1 is intended, or shall 

be deemed, to permit conduct that would otherwise constitute misappropriation of a trade secret 

of the Company under applicable Law or conduct that, even disregarding the terms hereof, 

otherwise would be actionable by the Company or any Member. 

ARTICLE XII 


Servicing of Assets 


12.1. Servicing. 

(a) Appointment and Acceptance as Servicer. Effective as of the Closing 

Date, but subject to Section 3.3 of the Contribution Agreement (with which the Manager agrees 

to comply) and the further obligations hereunder with respect to retention of the Servicer, the 

Manager is hereby appointed (and hereby accepts the appointment) with full authority and 

responsibility, in its own name, to act as the servicer for the Assets and any Collateral. Until 

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such time as the Company is dissolved and liquidated pursuant to Article IX, and except as 

otherwise provided in Section 12.4 and subject to the interim servicing being provided by or on 

behalf of the Initial Member pursuant to Section 3 .3 of the Contribution Agreement, the Manager 

shall, with respect to each Asset or Group of Assets, from and after the Closing Date, be 

responsible for (and hereby assumes responsibility for) Servicing (in accordance with the 

standards (collectively, the "Servicing Standard") set forth in Section 12.2 (such obligations 

referred to collectively herein as the "Servicing Obligations") and the other provisions of this 

Article XII, including the provisions of Section 12.3 (which require that Servicing, other than 

Asset Management functions retained by Manager, be performed through one or more Qualified 

Servicers)). Without in any way limiting the foregoing, but subject to Section 3.3 of the 

Contribution Agreement and applicable rights of the Manager to perform Asset Management 

pursuant to Section 12.3, the Manager shall cause the Assets (including, for all purposes under 

this Article XII, the related Collateral) to be serviced as follows: (a) such Asset shall, from and 

after the applicable Servicing Transfer Date, and except as provided in the immediately 

following subsection (b) or as otherwise expressly permitted by the Initial Member, be Serviced 

by or through the Servicer appointed in accordance with Section 12.3 below, and (b) following 

the replacement of the Servicer as a result of an Event of Default, the Assets shall be serviced by 

or through the Servicer appointed by the Initial Member in accordance with Section 12.4 below. 

All Servicing following the Closing Date shall be performed in accordance with the terms of the 

Contribution Agreement and this Article XII. 

(b) Servicing and Subservicing Agreement Requirements. Except as is 

otherwise agreed in writing by the Initial Member, each Servicing Agreement (and any 

Subservicing Agreement with any Subservicer) shall, among other things, 

(i) provide for the Servicing by the Servicer (or any Subservicer) in 

accordance with the Servicing Standard and the other terms of this Agreement; 

(ii) subject to clause (x) below with respect to immediate termination, 

be terminable upon no more than thirty days prior notice if an Event of Default or any default 

under the Servicing Agreement (or Subservicing Agreement) has occurred; 

(iii) provide that the Manager (in its individual capacity), the Initial 

Member and the PMN Agent (and, in the case of any Subservicing Agreement, the Servicer or 

applicable Subservicer having been engaged by the Servicer pursuant to a separate Subservicing 

Agreement, as the case may be) each shall be entitled to exercise termination rights under the 

relevant Servicing Agreement or Subservicing Agreement (it being understood that the Initial 

Member shall only exercise such termination rights as contemplated or permitted in this 

Agreement); 

(iv) provide that the Servicer (or any Subservicer) and the Manager (in 

its individual capacity) acknowledge that the Servicing Agreement (or Subservicing Agreement) 

constitutes a personal services agreement between the Manager (in its individual capacity) and 

the Servicer (or between the Servicer or applicable Subservicer having been engaged by the 

Servicer pursuant to a separate Subservicing Agreement, as the case may be, and the 

Subservicer, as applicable); 

50 

SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
(v) provide that (x) each of the Company, the PMN Agent, the FDIC 

and each Purchase Money Notes Guarantor are third party beneficiaries thereunder to the extent 

of any rights expressly granted to such Person under the Servicing Agreement or Subservicing 

Agreement and is entitled to enforce the Servicing Agreement or Subservicing Agreement, as 

applicable, with respect to such rights, and (y) the Initial Member and, in the case of any 

Subservicing Agreement, the Manager (in its individual capacity) is a third party beneficiary 

thereunder; and further provide that in no event shall any amendment or waiver to any such 

Servicing Agreement or Subservicing Agreement limit or affect any rights of any such third 

party beneficiary thereunder without the express written consent of such third party beneficiary; 

(vi) provide that (x) upon the removal of the Private Owner as the 

Manager or the occurrence of an Event of Default, each of the Initial Member and the PMN 

Agent (and any successor Manager) may exercise all of the rights of the Manager thereunder and 

cause the termination or assignment of the same from the Private Owner as the Manager to any 

other Person, without penalty or payment of any fee, and (y) upon the occurrence of any 

"Default" under (and as defined in) the Servicing Agreement, each of the Initial Member and the 

PMN Agent (and any successor Manager) may exercise all of the rights of (A) the Manager (in 

its individual capacity) under such Servicing Agreement and cause the termination or assignment 

of the same from the Manager (in its individual capacity) to any other Person, without penalty or 

payment of any fee, and (B) the Servicer (or applicable Subservicer having been engaged by the 

Servicer pursuant to a separate Subservicing Agreement) under the Subservicing Agreement and 

cause the termination or assignment of the Subservicing Agreement from the Servicer (or such 

applicable Subservicer) to any other Person, without penalty or payment of any fee (it being 

understood that the Initial Member shall only exercise the foregoing rights as contemplated or 

permitted in this Agreement); 

(vii) provide that the Initial Member, the Manager, the PMN Agent, 

each 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 Servicer and any Subservicers and that the Servicer and all Subservicers shall 

make available their respective officers, directors, employees, accountants and attorneys to 

answer the Initial Member's, the Manager's, the PMN Agent's, each Purchase Money Notes 

Guarantor's and the Company's (and each of their respective representatives') questions or to 

discuss any matter relating to the Servicer's or Subservicer's affairs, finances and accounts, as 

they relate to the Assets, the Collateral, the Company Accounts or any other accounts established 

or maintained pursuant to this Agreement, the Custodial and Paying Agency Agreement, the 

Servicing Agreement or any Subservicing Agreement, or any matters relating to the Servicing 

Agreement or any Subservicing Agreement or the rights or obligations thereunder; 

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

Collection Account on a daily basis (without reduction or setoff) within two Business Days of 

receipt and that under no circumstances are funds, other than Asset Proceeds and interest and 

earnings thereon, transfers of funds from the Working Capital Reserve Account and the proceeds 

ofExcess Working Capital Advances, to be commingled in the Collection Account; 

(ix) provide that the Servicer or any Subservicer shall not sell, transfer 

or assign its rights under the Servicing Agreement or Subservicing Agreement, as applicable, 

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SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
other than Servicer's rights to delegate to Subservicers (or applicable Subservicer's right to 

further delegate to another Subservicer) certain responsibilities thereunder as and to the extent 

permitted by this Agreement, and that any prohibited sale, transfer or assignment shall be void 

ab initio; 

(x) provide that (w) the Servicer consents to the immediate 

termination of the Servicer upon the occurrence of any Insolvency Event with respect to the 

Servicer, (x) each Subservicer consents to the immediate termination of such Subservicer upon 

the occurrence of a termination event under the Servicing Agreement, and upon the occurrence 

of any Insolvency Event with respect to such Subservicer (or any Subservicer having been 

engaged by such Subservicer), (y) the occurrence of any Restricted Servicer Change of Control 

with respect to the Servicer (or any applicable Rated Subservicer) constitutes a default under the 

Servicing Agreement (and any applicable Subservicing Agreement with such Rated Subservicer) 

and (z) the occurrence of any Insolvency Event with respect to the Servicer or any Subservicer 

constitutes a default under the Servicing Agreement and the Subservicing Agreement, as 

applicable; provided, however, that, in the case of the Servicing Agreement, or a Subservicing 

Agreement with a Rated Subservicer, the occurrence of an Insolvency Event with respect to a 

Subservicer (which is not an Affiliate of the Servicer) may, at the election of the Manager, be 

subject to a cure period of not more than thirty days for replacement of the affected Subservicer 

(in a manner that will permit the Manager to comply with its obligations hereunder); 

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

Servicer or any Subservicer against the Asset Proceeds (or the Company); 

(xii) provide for such other matters as are necessary or appropriate to 

ensure that the Servicer or any Subservicer is obligated to comply with the Servicing Obligations 

of the Manager hereunder; 

(xiii) provide a full release and discharge of 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 (or any 

such Subservicer) had, has or might have in the future, whether known or unknown, which are 

related in any manner whatsoever to the Servicing 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); 

(xiv) provide that, to the extent required under Section 12.3(h) hereof, 

all Loans registered on the MERS® System shall remain registered unless default, foreclosure or 

similar legal or MERS requirements dictate otherwise; 

(xv) provide that none of the Servicer, any Subservicer or any Affiliate 

of the Servicer or any Subservicer may at any time, (x) be or become a partner or joint venturer 

with any Borrower or Obligor, (y) be or become an agent of any Borrower or Obligor, or allow 

any Borrower or Obligor to be an agent of such Servicer or any Subservicer or of any Affiliate of 

the Servicer or any Subservicer, or (z) have any interest whatsoever in any Borrower or Obligor, 

and that the Servicer or Subservicer, as applicable, shall immediately notify the Manager and the 

Initial Member upon becoming aware of the occurrence of any of the foregoing; 

52 

SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
(xvi) provide that the Servicer (and any Rated Subservicer) shall 

immediately notify the Manager and the Initial Member of the occurrence of any Change of 

Control with respect to the Servicer (or any Rated Subservicer); 

(xvii) provide that, upon any sale of any Asset by the Company 

(including by the Servicer on behalf of the Manager on behalf of the Company) in accordance 

with the terms hereof, such Asset shall prospectively cease to constitute an "Asset" for any 

purpose of the Servicing Agreement or Subservicing Agreement, as applicable, provided that the 

Servicer or Subservicer, as applicable, shall not thereby be released from any liability or 

obligation thereunder with respect to such Asset in relation to the period prior to such sale; 

(xviii) not conflict with the Servicing Standard or any other terms or 

provisions of this Agreement, the Custodial and Paying Agency Agreement or any of the other 

Transaction Documents insofar as such other terms or provisions hereof or thereof are required 

to be imposed by the Manager (in its individual capacity) on the Servicer (or any Subservicers) 

in the Servicing Agreement (or Subservicing Agreements); and 

(xix) in the event the Subservicer is a Rated Subservicer, include, for the 

benefit of the Manager and each third party beneficiary under the Servicing Agreement 

(including the Company and each Required Consenting Party), an agreement of such Rated 

Subservicer to further comply with (and separately assume in favor of the Manager and each 

such third party beneficiary) all terms, conditions and obligations of the Servicer under the 

Servicing Agreement (including obligations in such Servicing Agreement with respect to 

maintenance of insurance, indemnity rights of the Indemnified Parties (as against such Rated 

Subservicer), and engagement of a Subservicer), in each case to the same extent as though such 

Rated Subservicer were executing the Servicing Agreement (as the "Servicer") directly with the 

Manager. 

Nothing contained in any Servicing Agreement or any Subservicing Agreement shall alter any 

obligation of the Manager under this Agreement and, in the event of any inconsistency between 

the Servicing Agreement (or any Subservicing Agreement) and the terms of this Agreement, 

among the parties to this Agreement the terms of this Agreement shall control. 

12.2. Servicing Standard. The Manager shall perform (or cause the performance of) the 

Servicing Obligations: (i) in the best interests and for the benefit of the Initial Member and the 

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

accordance with the terms of this Agreement and the other Transaction Documents, (iv) in 

accordance with all applicable Law, and (v) 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 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, however, that, 

with respect to each Asset and related Collateral, in the absence of a customary and usual 

standard of practice, the Company shall comply with the applicable Fannie Mae Guidelines, if 

any, with respect to similar loans and properties in similar situations. The Manager shall cause 

53 

SFR Venture 2011-l Structured Transaction 

Amended and Restated LLC Operating Agreement 
its Servicing Obligations with respect to the Assets and the Collateral to be performed without 

regard to (w) any relationship that the Company, the Manager the Servicer or any Subservicer, or 

any of their respective Affiliates, may have to any Borrower, Obligor or other obligor, or any of 

their respective Affiliates, including any other banking or lending relationship, (x) the 

obligations of any of the Company, the Manager, the Servicer or any Subservicer, to make 

disbursements and advances with respect to the Assets and Collateral, (y) 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 the Servicing Agreement or any Subservicing 

Agreement), and (z) the right of any of the Manager, the Servicer or any Subservicer, to receive 

compensation (including the Management Fee and any Interim Management Fee) for its services 

under this Agreement, the Servicing Agreement or any Subservicing Agreement. Without 

limiting the generality of the foregoing, the Manager's Servicing Obligations hereunder shall 

include the following: 

(a) discharging in a timely manner each and every obligation (i) which the 

Asset Documents provide is to be performed by the lender thereunder, on its own behalf and on 

behalf of the Company and the Initial Member and (ii) in the case of Acquired REO Property, 

which the Asset Documents that were applicable to the Collateral before it became Acquired REO 

Property provided were to be performed by the Borrower thereunder in respect of such Collateral 

(not including payment of debt service under the applicable Asset Documents), in the case of each 

of (i) and (ii), together with such additional obligations as are required of the Company under this 

Agreement or the Reimbursement, Security and Guaranty Agreement in respect of such Acquired 

REO Property; 

(b) incurring costs (including Servicing Expenses (or Interim Servicing 

Expenses) and Pre-Approved Charges) in accordance with (i) the provisions of the Asset 

Documents, or (ii) in the case of Acquired REO Property, the Asset Documents that were 

applicable to the Acquired REO Property before it became an Acquired REO Property (not 

including payment of debt service under the applicable Asset Documents), and, in the case of 

each of (i) and (ii), otherwise in accordance with the terms and conditions of the Reimbursement, 

Security and Guaranty Agreement; 

(c) causing to be maintained (i) on the Collateral with respect to which the 

Borrower has failed to maintain required insurance, and on any Acquired Property other than 

Acquired REO Property, insurance with extended coverage as is customary in the area in which 

the Collateral or Acquired Property is located and in such amounts and with such deductibles as 

the Manager may, in the exercise of its reasonable discretion, determine are prudent and as 

required under this Agreement or the Reimbursement, Security and Guaranty Agreement and (ii) 

on the Acquired REO Property, insurance as required under this Agreement or the 

Reimbursement, Security and Guaranty Agreement; 

(d) diligently monitoring and seeking compliance with the terms and 

conditions of each insurer under any hazard policy and preparing and presenting claims under 

any policy in a timely fashion in accordance with the terms of the policy; 

54 

SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
(e) superv1smg and coordinating the construction, ownership, management, 

leasing and preservation of the Acquired Property as well as all other matters involved in the 

administration, preservation and ultimate disposition of the Acquired Property as would be taken 

by a prudent asset manager managing properties similar to the Acquired Property and as required 

of the Company under this Agreement or the Reimbursement, Security and Guaranty Agreement; 

(f) administering the making of advances to Borrowers under Loans pursuant 

to and in accordance with the provisions herein and in the Custodial and Paying Agency 

Agreement governing the making of Funding Draws; 

(g) to the extent consistent with the foregoing, seeking to maximize the timely 

and complete recovery of principal and interest on the Assets and otherwise to maximize the 

value of the Assets and the Collateral; 

(h) except as otherwise set forth in this Agreement, making decisions under, 

and enforcing and performing in accordance with, the Asset Documents all loan administration, 

inspections, review of financial data and other matters involved in the Servicing; 

(i) ensuring that all filings required to maintain perfection in any Collateral 

remain up to date and in force, including Uniform Commercial Code financing statements; 

(j) ensuring that each Borrower (or in the case of Acquired REO Property, the 

applicable Ownership Entity) is diligently performing all applicable construction work using all 

commercially reasonable efforts in accordance with the requirements of the applicable Asset 

Documents and of this Agreement; 

(k) providing the Servicer and any Subservicers with copies of such 

Transaction Documents (or portions thereof) as are necessary for the Servicer or any 

Subservicers to be familiar with in order to perform their respective obligations provided for in 

this Agreement, the Servicing Agreements or the Subservicing Agreements, as applicable; and 

(I) complying, and causing the Servicer and each Subservicer to comply, with 

all applicable Laws regarding the privacy or security of Customer Information, including by 

maintaining and complying with policies and procedures for protection of Customer Information 

in a way that is designed to ensure such compliance with applicable Laws (including by 

obtaining information technology audits and maintaining monitoring software on internal 

accounting systems and the systems of applicable Servicer, Subservicers and other third-party 

vendors generating, maintaining or otherwise having access to any Customer Information). 

12.3. Servicing of Assets. 

(a) Aooointment of Servicer. The Manager (in its individual capacity) has 

entered into a Servicing Agreement dated the date hereof to provide for the Servicing by the 

Servicer named therein. Each Servicer, at all times during which it acts as Servicer, shall satisfy 

(and must continue to satisfy) the definition of Qualified Servicer. With respect to the Interim 

Servicing Period, subject to the provisions of Section 3.3 of the Contribution Agreement, each 

Asset shall at all times be Serviced, and the Servicing Obligations shall be performed, by or 

55 

SFR Venture 2011~1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
through the Servicer (including any Subservicers engaged by the Servicer as permitted 

hereunder), provided that, subject to Section 12.3(b) below, the Manager shall have the right to 

retain (and not delegate to the Servicer) any or all Asset Management functions. Subject to the 

other terms and conditions of this Agreement, the Servicer may be an Affiliate of the Private 

Owner or of the Manager. The Servicer may engage or retain one or more Subservicers (and any 

Rated Subservicer may further engage or retain one or more Subservicers), including Affiliates 

of the Private Owner or of the Manager, to perform certain of its duties under the Servicing 

Agreement (or applicable Subservicing Agreement), as it may deem necessary and appropriate, 

by entering into a Subservicing Agreement with each such Subservicer, provided that any 

Subservicer meets (and at all times continues to meet) the requirements set forth in the definition 

of Qualified Servicer and the terms of the applicable Subservicing Agreement comply with the 

terms of this Agreement and the applicable Servicing Agreement. The costs and fees of the 

Servicer (and any Subservicers) shall be borne exclusively by the Manager in its individual 

capacity without any right of reimbursement from the Company or the Initial Member (it being 

understood that the Manager will have the applicable rights to receive, or, if applicable, direct 

payment of, the Interim Management Fee and Management Fee in accordance with Section 12.5 

hereof). Except as expressly permitted with respect to direction of payment of the Interim 

Management Fee and the Management Fee to the Servicer pursuant to Section 12.5, under no 

circumstances shall the Manager transfer, or permit to be transferred, to the Servicer or any other 

Person any ownership interest in any Servicing rights or any right to transfer or sell any 

Servicing rights, and no Servicer shall be permitted to assign, pledge or otherwise transfer to any 

Subservicer or other Person or purport to assign, pledge or otherwise transfer any interest in any 

Servicing rights, and any purported assignment, pledge or other transfer in violation of this 

provision shall be void ab initio and of no effect. 

(b) Manager Right to Conduct Asset Management. Notwithstanding the 

obligation to generally cause all Servicing to be performed by (or through) the Servicer, the 

Manager shall have the right to retain (and not delegate to the Servicer) any or all Asset 

Management functions by expressly retaining such applicable Asset Management functions 

pursuant to the Servicing Agreement (including Schedule 2 thereto), with all Servicing other than 

such retained Asset Management being conducted by or through the Servicer. Any such 

Servicing (comprised entirely of Asset Management) not so delegated to the Servicer in 

accordance with the foregoing shall be duly performed by the Manager itself (without further 

delegation) in accordance with the Servicing Standard and the provisions herein and in the other 

Transaction Documents, with the Manager having all obligations (and with the same rights, 

benefits and protections to the Company, the Initial Member and any third party beneficiary 

hereof) as though the same were being conducted by the Servicer, such that the Manager, in 

performance of such Servicing shall meet and comply with all qualifications (including 

qualification as a Qualified Servicer), requirements (including as to insurance) and obligations of 

the Servicer hereunder (including as to reporting and audit requirements), in all cases without 

any additional expense to the Company (including as to any applicable insurance, certifications 

or licenses so required to be obtained or maintained by the Manager as a result of the foregoing). 

(c) Manager Liable for Servicer and Subservicers. Notwithstanding anything 

to the contrary contained herein, the use of the Servicer (or any Subservicer) shall not release the 

Manager from any of its Servicing Obligations or other obligations under this Agreement, and 

56 

SFR Venture 2011~1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
the Manager shall remain responsible and liable for all acts and omissions of the Servicer (and 

each Subservicer) as fully as if such acts and omissions were those of the Manager. All actions 

of the Servicer (or any Subservicer) performed pursuant to the Servicing Agreement (or any 

Subservicing Agreement) shall be performed as an agent of the Manager (or, in the case of 

Subservicers, the Servicer or applicable Rated Subservicer having engaged such Subservicer). 

(d) Copies of Servicing and Subservicing Agreements. Copies of all fully 

executed Servicing Agreements and Subservicing Agreements, including all supplements and 

amendments thereto, shall be provided to each Required Consenting Party and each Purchase 

Money Notes Guarantor. 

(e) Regulation AB Requirements. The Manager shall use commercially 

reasonable efforts to confirm, where applicable, that the Servicer (and any Subservicer) (i) has in 

place, policies and procedures instituted to monitor any performance or other triggers and events 

of default in accordance with the applicable Asset Documents and the Servicing Obligations (as 

generally required pursuant to Sections 1122(d)(l)(i) and (ii) of Regulation AB), and (ii) 

complies with Sections 1122(d)(2)(i) through (vii), and Sections 1122(d)(4)(i) through (xiv) of 

Regulation AB, it being understood that any such requirements of Regulation AB referenced 

herein shall be deemed applicable to the Servicing conducted hereunder (and under any 

Subservicing Agreement) regardless of whether such requirements apply, by their terms, only to 

companies registered or required to file reports with the Securities and Exchange Commission. 

(f) Servicer and Subservicer Fees. No Servicer or Subservicer shall be paid 

any fees or indemnified out of any Asset Proceeds (or funds in any Company Account or any 

other Company account), it being understood that all fees and related costs or liabilities of the 

Servicer and Subservicers shall be the sole responsibility of the Manager (in its individual 

capacity), without any right of reimbursement from the Company or the Initial Member 

(provided that this clause (f) does not prohibit reimbursement to the Manager (in its individual 

capacity) for Servicing Expenses or Pre-Approved Charges incurred by the Servicer or any 

Subservicer on behalf of the Manager (in its individual capacity)). 

(g) Fidelity Bond; E&O Insurance. The Servicer and each Subservicer shall 

maintain (and, to the extent the Manager performs any Servicing functions pursuant to Section 

12.3(b), the Manager shall, at its sole cost and expense, itself 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 50.0% of the limits. The Manager 

may require that the Servicer and each Subservicer purchase additional limits to equal or exceed 

the required limits as stated above. "Potential reduction of 50.0%" 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 policy would reduce the limits by 50.0%. 

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

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

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

$10,000,000 per claim and $10,000,000 in the aggregate, 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 any 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. 

(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, $!,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 $!0,000,000 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 prior written 

notice of cancellation of thirty days, except for non-payment of premium whereby a ten day prior 

written 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 Manager shall notify (or shall cause the Servicer and Subservicer to notify) each Required 

Consenting Party and each Purchase Money Notes Guarantor immediately ofthe cancellation or 

the receipt of a notice of cancellation of any fidelity bond or insurance policy required to be 

maintained pursuant to this Section 12.3(g) and the efforts made to obtain replacement coverage. 

The Manager shall provide (or shall cause the Servicer and each Subservicer to provide) each 

Required Consenting Party and each Purchase Money Notes Guarantor with certificates 

evidencing all fidelity bonds and insurance policies required to be maintained pursuant to this 

Section 12.3(g) on the Closing Date (and, with respect to each Asset, on or before the applicable 

Servicing Transfer Date with respect thereto) and each auniversary of the Closing Date 

thereafter, and otherwise upon request of such Required Consenting Party or such Purchase 

Money Notes Guarantor. Copies of fidelity bonds and insurance policies required to be 

maintained pursuant to this Section 12.3(g) shall be made available to the each of the Required 

Consenting Party and each Purchase Money Notes Guarantor or their respective representatives, 

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on the Closing Date (and, with respect to each Asset, on or before the applicable Servicing 

Transfer Date with respect thereto), and shall otherwise be made available to any Required 

Consenting Party or any Purchase Money Notes Guarantor or their respective representatives 

upon request. 

(h) MERS Requirements. In the event that any of the Loans are (or are 

required by the terms hereof to be) registered on the MERS® System, and unless and until no 

Loan so remains registered on the MERS® System in accordance herewith, (i) the Manager shall 

cause each of the Company and the Servicer to be (or become) a member of MERS on or before 

the initial Servicing Transfer Date, and to each maintain itself as a MERS member in good 

standing (including paying all dues and other fees required to maintain its membership and 

complying with MERS policies and procedures), and (ii) the Servicer shall maintain (or register, 

as applicable) such Loan 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 assigmnent and other comparable instruments with respect to such 

assignment or re-recording of a mortgage securing a Loan in the name of MERS, solely as 

nominee for the Company and its successors and assigns. With respect to each Loan that is 

registered on the MERS® System, (x) the Servicer shall be designated as the "servicer" and 

1000002 (Org Id.) shall be designated as the "investor" with respect to such Loan, and, if 

applicable, the Manager may cause or permit an applicable Subservicer (and, in the event such 

Loan is being serviced by a Rated Subservicer, shall so cause such Subservicer) to be designated 

as the "subservicer" with respect to such Loan (provided, that (A) upon the Company becoming a 

member of MERS in good standing, the Manager shall cause the Company to be identified in the 

"investor" field on the MERS® System, and (B) the Manager may, as determined in accordance 

with the Servicing Standard and so long as the Manager is and remains a MERS member in good 

standing, designate the Manager as the "servicer" with respect to any such Loan, in which case the 

Servicer shall be designated as the "subservicer" with respect thereto), and (y) no other Person 

shall be identified on the MERS® System as having any interest in such Loan unless otherwise 

consented to by the Initial Member (or required pursuant to the Electronic Tracking Agreement). 

All Loans registered on the MERS® System shall remain registered on the MERS® System 

unless default, foreclosure or similar legal or MERS requirements dictate otherwise; provided, 

however, that if the Manager determines, in accordance with the Servicing Standard and other 

applicable provisions herein and in the other Transaction Documents, to remove any or all such 

Loans so registered with MERS from the MERS® System, the Manager shall have the right to 

cause such removal so long as, with respect to any such Loan to be so removed, (A) the applicable 

mortgage (or other Collateral Document) and rights to Collateral for such Loan that are so 

registered in the name of MERS are duly transferred and assigned to the Company (with all 

applicable recordings or filings with respect thereto being duly made) so as to cause the Company 

to have the full benefit of its applicable security (or other) interest in all such Collateral, (B) for 

any such removal occurring on or before the applicable Servicing Transfer Date, the same is 

accomplished in accordance with the applicable requirements (and delivery of the applicable 

notice) in Section 3.1(c) of the Contribution Agreement, and (C) for any such removal prior to the 

PMN Satisfaction/Defeasance Date, the Company shall have duly delivered to the PMN Agent 

such documents and otherwise taken such actions (including execution and recordation of 

applicable assignments in accordance with the Reimbursement, Security and Guaranty 

Agreement), in each case so as to cause all such Collateral to be and remain subject to the first 

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priority security interest granted under the Reimbursement, Security and Guaranty Agreement. 

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 Loans and to confirm that the Loans required to be 

registered on the MERS® System are so registered. For so long as any Loans remain registered 

with MERS, the same shall be subject to an Electronic Tracking Agreement in the form of Exhibit 

B to the Servicing Agreement, and, to the extent any such Loans are so registered with MERS as 

of the Closing Date, the Servicer, the Manager, the PMN 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 Loans registered on the MERS® System and 

provide the results to the Manager and the Initial Member and, if requested by the Manager or the 

Initial Member (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. 

(i) Information Security Standards. Further to Section 12.2(1), the Manager 

shall promptly make available to the Initial Member and the PMN Agent information regarding 

the policies and procedures for protection of Customer Information described in Section 12.2(1) as 

requested by either of them from time to time. The Manager further agrees that any Customer 

Information transmitted electronically by it (or the Servicer or any Subservicer) shall be 

encrypted. 

12.4. Removal ofServicer. 

(a) Removal of Servicer. Upon the occurrence of an Event of Default, in 

addition to any other rights it may have pursuant to this Agreement, any other Transaction 

Document or applicable Law (including the Uniform Commercial Code), whether at Law or in 

equity and whether pursuant to statute or regulation or otherwise, the Initial Member shall have 

the right to take, at the Initial Member's option and the Manager's expense, one or more of the 

following actions: (i) upon notice in writing to the Manager (effective at such time as is specified 

in such notice), to act on behalf of the Manager (in its individual capacity) to terminate the 

existing Servicer (and any Subservicers) and to cause the Manager (in its individual capacity) to 

enter into a new Servicing Agreement with a servicer (as a successor Servicer) selected by the 

Initial Member (in its sole and absolute discretion, and whether or not the same qualifies as a 

Qualified Servicer), and (ii) upon notice in writing to the Manager (effective at such time as is 

specified in such notice), to remove the Private Owner as the Manager and appoint a successor 

Manager (which successor Manager may be the Initial Member) in the sole discretion of the 

Initial Member, whereupon (without limitation of Section 13 .5), such successor Manager shall 

immediately succeed to all, or such portion as the Initial Member and successor Manager agree, 

of the rights and obligations of the Private Owner as the Manager of the Company, and, in such 

case, the Initial Member shall further have the right (A) to terminate the Servicer and any or all 

Subservicers (in its sole and absolute discretion), and cause or permit the successor Manager 

selected by the Initial Member (and/or the Company directly, as determined by the Initial 

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Member in its sole discretion) to enter into a Servicing Agreement with a successor Servicer, 

such Servicing Agreement to be between the applicable successor Manager (and/or the 

Company) and the successor Servicer chosen by the Initial Member, or (B) to retain the existing 

Servicer and cause or permit the successor Manager (and/or the Company directly, as determined 

by the Initial Member in its sole discretion) to enter into a new Servicing Agreement between 

such successor Manager (and/or the Company) and the Servicer (or to effect an assignment of 

the existing Servicing Agreement from the existing Manager (in its individual capacity) to such 

successor Manager (and/or the Company). None of the Initial Member, any successor Manager 

or the Company shall have any obligation to assume any obligations or liabilities of the removed 

Manager (in its individual capacity) under or in connection with any Servicing Agreement. 

Notwithstanding the foregoing, the Initial Member shall not exercise its right to terminate a 

Servicer that is not an Affiliate of the Manager or of the Private Owner in the absence of (I) an 

Event of Default attributable in whole or in part to the failure by the Servicer or any of its 

Subservicers to perform any material obligation under its applicable Servicing Agreement or 

Subservicing Agreement, (2) an Event of Default as described in clause (ii) or clause (vii) of the 

definition thereof with respect to the Servicer or any of its Subservicers, (3) an Event of Default 

resulting from the failure of the Servicer or any of its Subservicers at any time to meet the 

criteria of a Qualified Servicer, (4) an Event of Default as described in clause (v) of the 

definition thereof, to the extent relating to such Servicer or any of its Subservicers, or (5) any 

other Event of Default that consists of a breach of a Servicing obligation under this Agreement. 

Subject to the foregoing, the Manager hereby consents to the immediate termination of the 

Servicer upon the occurrence of any Event of Default. For the avoidance of doubt, the rights of 

the Initial Member in this Section 12.4 are in addition to, and can be exercised independently of 

the rights of the Initial Member in Sections 3.2, 3.13, and 3.14; and in any event all rights and 

remedies of the Initial Member under this Agreement with respect to or following an Event of 

Default shall be cumulative, and any or all thereof may be exercised instead of or in addition to 

each other or any other remedies available to the Initial Member, whether under this Agreement, 

any other Transaction Document or otherwise. 

(b) Aooointment of Successor Servicer. If the Initial Member exercises its 

right to act on behalf of the Manager (in its individual capacity) to appoint a successor Servicer, 

the costs and expenses associated with such successor Servicer (including any Servicing fees) 

shall be borne by the Manager (in its individual capacity) (and not the Company, the PMN Agent 

or the Initial Member), and no termination or other fee shall be due to the Manager (in any 

capacity) or the Servicer or any Subservicer in connection with or as a result of any such action; 

provided, however, that, if the Initial Member or the PMN Agent has also exercised its right to 

remove the Manager (such that such removed Manager no longer has rights to the Management 

Fee), then, with respect to Servicing fees of such successor Servicer (but not costs and expenses 

in connection with the replacement of the Servicer with such successor Servicer) such removed 

Manager shall be responsible (in any capacity) only for the portion of such fees that, as of any 

particular Distribution Date, are in excess of the Management Fee payable to the successor 

Manager on such Distribution Date. 

(c) Removal of Manager; Management Fee. If the Initial Member exercises 

its right pursuant to this Section 12.4 to remove the Private Owner as the Manager and appoint a 

successor Manager, (i) the successor Manager selected by the Initial Member shall immediately 

succeed to all, or such portion as the Initial Member and successor Manager agree, of the rights 

61 

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and obligations of the Private Owner as the Manager of the Company, and all references in this 

Agreement to the Private Owner, in its capacity as Manager of the Company, shall be deemed to 

be references to the successor Manager so appointed by the Initial Member, (ii) without 

limitation of Section 13.5, the Initial Member shall have the right to determine, in its sole 

discretion, the extent, terms and conditions of the appointment of any such successor Manager, 

including as to compensation (whether from the Initial Member or the Company), 

indemnification by the Company, term of appointment and removal rights, in each case without 

the necessity for any consent from the Private Owner or any other Person, and (iii) the successor 

Manager appointed by the Initial Member shall be entitled to be paid the Interim Management 

Fee or Management Fee (or, in each case, such portion thereof as the Initial Member and the 

successor Manager agree) in accordance with the terms of this Agreement and the Custodial and 

Paying Agency Agreement. The removal of the Private Owner as the Manager shall not relieve 

the Private Owner of (x) any of the liabilities and/or obligations of the Private Owner as Manager 

to the extent required under the terms of this Agreement to have been paid and/or performed 

prior to such removal or (y) any liability the Private Owner may have arising out of any act or 

omission by the Private Owner as Manager. No successor to the Private Owner as Manager shall 

have any liability or obligation for any of the matters described in clause (x) or l.Yl of the 

preceding sentence, except as may be otherwise specified pursuant to any modification to this 

Agreement pursuant to Section 13.5. In connection with any such removal of the Manager, the 

Initial Member and any successor Manager selected by the Initial Member are each hereby 

authorized and empowered, as attorney-in-fact or otherwise, to execute and deliver, on behalf of 

and at the expense of the removed Manager (in its individual capacity), any and all documents 

and other instruments and to do or take any and all acts necessary or appropriate to effect the 

termination and replacement of such Manager and the Servicer and, in the event the Initial 

Member decides to retain a new Servicer, to enter into a new Servicing Agreement between the 

successor Manager (and/or the Company) and the Servicer or to effect an assignment of the 

existing Servicing Agreement from the removed Manager (in its individual capacity) to the 

successor Manager (and/or the Company). 

(d) Cooperation To Facilitate Transfer. In the event any of the Manager, the 

Servicer or a Subservicer is terminated pursuant to the provisions of this Article XII, the 

Manager (in its individual capacity) shall, and shall cause the Servicer (and any Subservicer) to, 

provide the Initial Member and any successor Manager or Servicer in a timely manner with all 

documents, records and data (including electronic documents, records and data) requested by the 

Initial Member or any successor Manager or Servicer to enable such Person to assume the 

responsibilities as Manager under this Agreement and any applicable Servicing Agreement, and 

to cooperate with the Initial Member in effecting the termination of the Servicer (or any 

Subservicer) or the Manager's rights as "Manager" under this Agreement, including, in each case 

subject to applicable requirements in the Custodial and Paying Agency Agreement and the 

Reimbursement, Security and Guaranty Agreement, (i) the transfer within one Business Day to 

such account as the Initial Member may specify of all cash amounts which, at the time, shall be 

or should have been credited to the Collection Account or are thereafter received with respect to 

any Assets or Acquired Property, and (ii) the transfer of all lockbox accounts with respect to 

which payments or other amounts with respect to the Assets are directed or the redirection of all 

such payments and other amounts to such account as the Initial Member may specify, and 

(iii) the assignment to the Initial Member (or the applicable successor Manager or Servicer as 

62 

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indicated by the Initial Member) of the right to access all such lockbox accounts, the Collection 

Account, and any other account into which Asset Proceeds or Borrower escrow payments are 

deposited or held. The Manager (in its individual capacity) shall be liable for all costs and 

expenses incurred by the Initial Member or the Company (i) associated with the complete 

transfer of the Servicing data, (ii) associated with the completion, correction or manipulation of 

Servicing data as may be required to correct errors or insufficiencies in the Servicing data to 

enable the Initial Member and any successor Manager and successor Servicer (and Subservicers) 

to service the Assets and Acquired Property properly and effectively, and (iii) to retain and 

maintain the services of a successor Manager and/or successor Servicer (and any Subservicers), 

it being understood that, as to the compensation to be paid to the successor Manager (and 

Servicing fees due and payable to the Servicer or any Subservicer engaged by or through such 

successor Manager), the removed Manager shall be responsible only for the portion of such 

compensation and fees that, as of any particular Distribution Date, are in excess of the 

Management Fee payable to the successor Manager on such Distribution Date. Within a 

reasonable time after receipt of a written request of the Manager (in its individual capacity) for 

the same, the Initial Member shall provide reasonable documentation evidencing such costs and 

expenses, but the Initial Member's right to reimbursement of such costs and expenses (and to 

exercise offset rights under Section 4.6(h) on account thereof) shall not be subject to or 

contingent upon the provision of such documentation. 

(e) Replacement Rights ofPMN Agent. If any Purchase Money Note is 

outstanding, the PMN Agent shall have the same rights and benefits under Sections l2.4(a), {hl, 

(£) and@ as the Initial Member (as ifreferences in said sections to the "Initial Member" were to 

the "PMN Agent"), which rights and benefits shall be in addition to, and separate from, the rights 

and benefits afforded to the Initial Member under said sections. In the event of any conflict 

between any instructions (or any determinations) of the Initial Member and the PMN Agent 

(while it is a Required Consenting Party) in connection with any such removal or replacement, 

the instructions and determinations of the PMN Agent shall prevail. 

(f) Power of Attorney. The Company hereby irrevocably constitutes and 

appoints the Initial Member and any officer or agent thereof, with full power of substitution, as 

its true and lawful attorney-in-fact for the purposes of this Agreement and allowing the Initial 

Member to perfect, preserve the validity, perfection and priority of, and enforce any Lien granted 

by this Agreement and, after the occurrence and during the continuance of any Event of Default 

(which shall include all events of default under any Transaction Document), to exercise its rights, 

remedies and powers and privileges under this Agreement. This appointment as attorney-in-fact 

is irrevocable and coupled with an interest until this Agreement is terminated and the security 

interests created hereby are released. Without limiting the generality of the foregoing, but 

subject at all times to the rights of a secured party under the Reimbursement, Security and 

Guaranty Agreement, the Initial Member shall be entitled under this Section 12.4(f) to do any of 

the following if an Event of Default has occurred and is continuing: (i) ask, demand, collect, sue 

for, recover, receive and give receipt and discharge for amounts due and to become due under 

and in respect of any or all of the Assets; (ii) file any claims or take any action or proceeding in 

any court of law or equity that the Initial Member may reasonably deem necessary or advisable 

for the collection or other enforcement of all or any part of the Assets, defend any suit, action or 

proceeding brought against the Company with respect to any Asset, and settle, compromise or 

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adjust any such suit, action or proceeding; (iii) execute, in connection with any sale or 

disposition of the Assets, any endorsements, assignments, bills of sale or other instruments of 

conveyance or transfer with respect to all or any part of the Assets; (iv) enforce the rights of the 

Company under any provision of any Servicing Agreement to the extent permitted thereunder 

and under the terms of this Agreement; (v) pay or discharge Taxes and Liens levied or placed on 

the Assets; (vi) generally, sell, transfer, pledge and make any agreement with respect to or 

otherwise deal with any of the Assets as fully and completely as though the Initial Member were 

the absolute owner thereof for all purposes; and (vii) do, at the Initial Member's option and the 

Company's expense, at any time and from time to time, all acts and things that the Initial 

Member reasonably deems necessary to protect, preserve, or realize upon the Assets and the 

Initial Member's security interests in any Secured Assets and to effect the intent of this 

Agreement, all as fully and effectively as the Company might do. Anything in this Section 

12.400 to the contrary notwithstanding, the Initial Member agrees that it shall not exercise any 

right under the power of attorney provided for in this Section 12.400 unless an Event of Default 

shall have occurred and be continuing. 

12.5. Interim Management Fee and Interim Servicing Fee; Management Fee. For each 

Due Period (and as determined separately for each Group of Assets), (i) with respect to any 

Group of Assets for which the Servicing Transfer Date has not occurred as of the first day of 

such Due Period, the Company shall pay the Interim Management Fee to the Manager and the 

Interim Servicing Fee to the Initial Member, and (ii) for each Group of Assets for which the 

Servicing Transfer Date has occurred as of (or occurs on) the first day of such Due Period, the 

Company shall pay the Management Fee to the Manager. Each such payment of any Interim 

Servicing Fee, Interim Management Fee and Management Fee shall be made in the manner 

described in the Custodial and Paying Agency Agreement (and, as applicable, on the Distribution 

Date with respect to the applicable Due Period, provided that to the extent there are insufficient 

funds in the Distribution Account to pay any applicable Management Fee or Interim 

Management Fee then payable (including on account of any prior deferred amounts), the amount 

of such deficiency shall be added to the Management Fee or Interim Management Fee, as 

applicable, that is due on the next succeeding Distribution Date, without the accrual of interest 

and without the Company being deemed to be in breach of any obligation to pay any such 

Management Fee or Interim Management Fee, until all such fees so deferred and unpaid have 

been paid in full). In the event the Manager is removed and replaced by the Initial Member or 

the PMN Agent in accordance with Section 12.4 above, the Management Fee and Interim 

Management Fee shall thereafter be payable to the Initial Member or the PMN Agent or 

successor Manager, as determined by the Initial Member or the PMN Agent, as the case may be, 

pursuant to such Section 12.4. Subject to the foregoing (and to all limitations on payments to the 

Manager, and rights of the Initial Member, the PMN Agent, any Holder and any Purchase Money 

Notes Guarantor to any such amounts, as set forth in the Transaction Documents), the Manager 

may, by delivery of written notice to the Paying Agent (with a copy to each Required Consenting 

Party) direct payment of all or any portion of the Interim Management Fee and the Management 

Fee to the Servicer if, and only for so long as, (i) there shall not have occurred and be continuing 

any Event of Default, or any Insolvency Event with respect to the Servicer, (ii) such Servicer is 

and remains an Affiliate of the Manager, (iii) such assignment is on fair terms and would not 

result in the Private Owner being in violation of any of its obligations under the Transaction 

Documents (including the obligation to be and remain a Special Purpose Entity), and (iv) such 

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Amended and Restated LLC Operating Agreement 
Servicer has no right (and expressly disclaims any such right) to enforce against the Paying 

Agent or the Company (or any Person other than the Manager) any such right granted by the 

Manager for the Servicer to so receive such payment of all or any portion of the Interim 

Management Fee or the Management Fee. 

12.6. Working Capital Expenses. Subject to Section 3.3 of the Contribution Agreement 

(with respect to the Interim Servicing Period, including as to any Interim Servicing Expenses), 

from and after the Closing Date (and, with respect to each Asset, from and after the Servicing 

Transfer Date with respect thereto), the Manager shall cause the Company to pay, from available 

Company funds (in the Collection Account, the Working Capital Reserve Account or any other 

applicable Company account the funds of which may be used for such purpose, or otherwise 

through Excess Working Capital Advances funded by the Manager) all amounts due as Servicing 

Expenses (or, as applicable, Pre-Approved Charges), Required Funding Draws and other 

Working Capital Expenses in a timely manner, and in each case in accordance with applicable 

requirements set forth in the Custodial and Paying Agency Agreement (and, as applicable, the 

Contribution Agreement); provided, however, that anything to the contrary herein or in any other 

Transaction Document notwithstanding, the Manager shall not have an obligation to fund Excess 

Working Capital Advances for purposes of the payment by the Company of (i) any PreApproved Charges, (ii) any Servicing Expenses (or Interim Servicing Expenses) consisting of 

amounts required for the Company to discharge the Obligations as they become due, or to make 

applicable indemnification and/or reimbursement payments owing by the Company to the Initial 

Member, the Transferor, the PMN Agent or any other Indemnified Party under the Transaction 

Documents, in each case to the extent such amounts would not constitute Servicing Expenses (or 

Interim Servicing Expenses) but for application of clause (viii) of the definition of Servicing 

Expenses (or clause (viii) of the definition of Interim Servicing Expenses), or (iii) any specific 

Servicing Expense relating to an Asset to the extent that the Manager has reasonably determined 

in accordance with the Servicing Standard that such Servicing Expense, if so paid, when 

combined with all unreimbursed previous Servicing Expenses, Required Funding Draws and PreApproved Charges with respect to such Asset (and any remaining Interim Servicing Expenses or 

other amounts owing to the Initial Member with respect to its Servicing of such Assets during the 

Interim Servicing Period pursuant to Sections 2.3. 2.4, 11_ and D of the Contribution 

Agreement), would not ultimately be recoverable from the Asset Proceeds for such Asset. All 

Working Capital Expenses (and Excess Working Capital Advances for the funding of the same) 

shall be reimbursed in accordance with the Custodial and Paying Agency Agreement. 

12.7. Use of Asset Proceeds. 

(a) Permitted Payments. Subject to Section 12.7(b), each month the Asset 

Proceeds shall be utilized and distributed in the manner set forth in the Custodial and Paying 

Agency Agreement following receipt by the Paying Agent from the Manager of the Cash Flow 

and Distribution Report required to be provided under Section 7.4 (and Section 3(b) of the 

Reporting and Access Schedule). 

(b) Costs That Are Not Reimbursable. Notwithstanding anything else to the 

contrary contained herein or in any other Transaction Document, without the prior written 

consent of the Initial Member (which may be withheld, conditioned or delayed in the Initial 

Member's sole and absolute discretion), in no event may the Manager deduct from the Asset 

65 

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Proceeds, or otherwise use Asset Proceeds to reimburse itself or the Servicer or any Subservicer 

or pay for, any Excluded Expenses (all of which shall be borne by the Manager in its individual 

capacity). 

12.8. Collection Account. On the Closing Date, the Manager shall cause the Company 

to establish the Collection Account with the Paying Agent in accordance with the Custodial and 

Paying Agency Agreement. The Collection Account (and all funds therein) shall be subject to 

the security interest granted under the Reimbursement, Security and Guaranty Agreement and to 

the Account Control Agreement under the Custodial and Paying Agency Agreement. 

12.9. Distribution Account. On the Closing Date, the Manager shall cause the 

Company to establish the Distribution Account with the Paying Agent in accordance with the 

Custodial and Paying Agency Agreement. The Distribution Account (and all funds therein) shall 

be subject to the security interest granted under the Reimbursement, Security and Guaranty 

Agreement and to the Account Control Agreement under the Custodial and Paying Agency 

Agreement. 

12.1 0. [Reserved]. 

12.11. Working Capital Reserve Account. 

(a) Establishment of Working Capital Reserve Account. On the Closing Date, 

the Manager shall cause the Company to establish the Working Capital Reserve Account with 

the Paying Agent for the exclusive purpose of holding the Working Capital Reserve to cover 

Working Capital Expenses to the same extent, and in the same order of priority, as are applicable 

to Asset Proceeds in accordance with the terms hereof and the Custodial and Paying Agency 

Agreement (and, as of any date of determination, the amount of the Working Capital Reserve 

shall be deemed to be the amount of the funds in such Working Capital Reserve Account). The 

Working Capital Reserve Account (and all funds therein) shall be subject to the security interest 

granted under the Reimbursement, Security and Guaranty Agreement and to the Account Control 

Agreement under the Custodial and Paying Agency Agreement. 

(b) Funding Working Capital Reserve. On the Closing Date, the Initial 

Member and the Private Owner shall fund the Working Capital Reserve in an initial principal 

amount of the WCR Account Deposit as follows: the Initial Member shall deposit cash in the 

amount of the Initial Member WCR Account Deposit, and the Private Owner shall deposit cash 

in the amount of the Private Owner WCR Account Deposit, which deposits shall be made in 

accordance with the applicable provisions of the Private Owner Interest Sale Agreement. The 

Company may fund the Working Capital Reserve Account with Asset Proceeds in accordance 

with the terms of the Custodial and Paying Agency Agreement and must maintain certain deposit 

amounts to comply with the Working Capital Reserve Target established under the Custodial and 

Paying Agency Agreement. 

(c) Use of Working Capital Reserve. The Manager or (in relation to its 

interim Servicing obligations) the Initial Member may direct the Company to withdraw funds 

from the Working Capital Reserve Account (including, as applicable, through release of such 

funds into the Collection Account) only to cover Working Capital Expenses in accordance with 

66 

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Amended and Restated LLC Operating Agreement 
Section 3.6 of the Custodial and Paying Agency Agreement. The Manager shall not permit 

withdrawals from the Working Capital Reserve Account for any other purpose, provided that, to 

the extent expressly permitted in the Custodial and Paying Agency Agreement, the Manager may 

cause the release of funds from the Working Capital Reserve Account (including for purposes of 

distributions to the Members) in accordance with, and subject to, the terms of the Custodial and 

Paying Agency Agreement. With respect to any Group of Assets, on the Servicing Transfer 

Date, the Initial Member shall be reimbursed from the Working Capital Reserve Account 

(including, as applicable, through release of such funds into the Collection Account) for an 

amount equal to all Working Capital Expenses paid by it with respect to such Group of Assets at 

any time after the Cut-Off Date and on or before such Servicing Transfer Date (to the extent the 

same have not been otherwise reimbursed pursuant to the Contribution Agreement or Custodial 

and Paying Agency Agreement). 

(d) Permitted Investments. The Working Capital Reserve shall be invested in 

Permitted Investments in accordance with the Custodial and Paying Agency Agreement. 

12.12. [Reserved]. 

12.13. [Reserved]. 

12.14. Other Uses of Company Funds. Subject to the terms and conditions herein and in 

the other Transaction Documents, the Company shall use Asset Proceeds, Excess Working 

Capital Advances, and funds in the Working Capital Reserve Account, the Collection Account or 

any other Company Account solely for such purposes as are expressly permitted herein, in the 

Custodial and Paying Agency Agreement and in the other applicable Transaction Documents. 

The foregoing notwithstanding, at the request ofthe Manager and the Private Owner, and subject 

to the specific written approval of the Initial Member (which approval may be granted or 

withheld in the sole discretion of the Initial Member, and shall, in order to be granted, require the 

consent of each other Required Consenting Party in its sole discretion), the Company may, on an 

Asset-by-Asset basis, fund or incur additional expenses with respect to an Asset (not otherwise 

expressly permitted to be funded by the Company), including for purposes of the completion by 

the applicable Borrower under a Loan or by the Company with respect to Acquired REO 

Property (to the extent the Company is not otherwise required to fund the same pursuant to 

Required Funding Advances). Any such request by the Manager and the Private Owner to the 

Initial Member shall specify in reasonable detail the applicable requested expenses (including an 

applicable budget and time line with respect thereto) and requested sources (including any 

applicable use of funds in the Collection Account, the Working Capital Reserve, and any right or 

obligation to make Excess Working Capital Advances with respect thereto), and any such 

requested expenses and sources shall be permitted only to the extent expressly set forth in the 

applicable written approval, ifany, by the Initial Member. 

12.15. Certain Servicing and Asset Administration Decisions. The Manager shall have 

full power and authority, acting alone or through the Servicer or any Subservicer, to cause to be 

done any and all things in connection with the Servicing that the Manager may deem necessary 

or desirable, and cause to be made all Servicing decisions in its reasonable discretion, subject to 

its obligation to comply with the Servicing Standard and other applicable provisions herein and 

in the other Transaction Documents. Upon the occurrence of an event of default under any of the 

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Amended and Restated LLC Operating Agreement 
Asset Documents, but subject to the other terms and conditions of this Agreement (including the 

Servicing Standard), the Manager shall cause to be determined the response to such event of 

default and course of action with respect to such event of default, including (i) 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, (ii) the declaration and recording of a 

notice of such default and the acceleration of the maturity of the Asset, (iii) the institution of 

proceedings to foreclose under the Asset Documents securing the Asset pursuant to the power of 

sale contained therein or through a judicial action, or to appoint a receiver, (iv) the institution of 

proceedings against any Obligor, (v) the acceptance of a deed in lieu of foreclosure, (vi) 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 Uniform Commercial Code sale, and (vii) the institution or 

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

Obligor. Notwithstanding any provision to the contrary herein, the Manager shall not, and shall 

not cause the Servicer or any Subservicer to, take any action that is inconsistent with or 

prohibited by the terms of the Reimbursement, Security and Guaranty Agreement or the 

Custodial and Paying Agency Agreement, in each case without the prior written consent of the 

Initial Member. 

12.16. Management and Disposition of Collateral. Subject to the other terms and 

conditions of this Agreement (including the Servicing Standard) and the Reimbursement, 

Security and Guaranty Agreement, the Manager shall have full power and authority, acting alone 

or through the Servicer and any Subservicer, to cause to be done any and all things in connection 

with the Manager's management of any Collateral or Acquired Property, that the Manager may 

deem necessary or desirable, and cause to be made all asset management decisions in its 

reasonable discretion. 

12.17. Acquisition of Collateral. 

(a) 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 Uniform 

Commercial Code, or otherwise, title to such Acquired REO Property shall be taken and held in 

the name of an Ownership Entity; provided, however, that for any Acquired REO Property with 

respect to which there exists any Environmental Hazard, the Ownership Entity that holds such 

Acquired REO Property may hold title only to such Acquired REO Property (and no other 

Acquired REO Property). 

(b) Nothing in this Article XII or anything else in this Agreement shall be 

deemed to affirmatively require the Manager to cause the Company to acquire all or any portion 

of any Acquired REO Property with respect to which there exists any Environmental Hazard. 

Prior to acquisition of title (whether by foreclosure, deed in lieu of foreclosure, by power of sale 

or by sale pursuant to the Uniform Commercial Code, or otherwise) to any residential Acquired 

REO Property, the Manager may, cause a Site Assessment to be commissioned with respect to 

such Acquired REO Property, provided that the Company may rely on a third-party Site 

Assessment conducted within one year prior to acquiring title so long as the Company has 

obtained all relevant updates within one hundred and eighty days prior to acquiring title, and 

taken applicable further action, so as to be deemed to have satisfied the United States 

Environmental Protection Agency's "All Appropriate Inquiries" standards, set forth in 40 C.F .R. 

68 

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Amended and Restated LLC Operating Agreement 
§ 312, for meeting the "Bona Fide Prospective Purchaser" and "Innocent Purchaser" defenses 

under the Superfund statute, 42 U.S.C. §§ 9601, 9607. The costs of any Site Assessment (or 

relevant updates) conducted or obtained pursuant to the foregoing shall be deemed to be 

Servicing Expenses (or Interim Servicing Expenses) as long as such costs were not paid to any 

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

(c) The Company shall be the sole member of each Ownership Entity and 

each Ownership Entity shall be wholly owned by the Company. The purposes of each 

Ownership Entity shall be to hold the Acquired Property pending sale, to complete applicable 

permitted construction of any such Acquired Property and to operate the Acquired Property as 

efficiently as possible in order to minimize financial loss to the Company, the Required 

Consenting Parties, the Holders and Purchase Money Notes Guarantors and to sell the Acquired 

REO Property as promptly as practicable in a way designed to minimize financial loss to the 

Company, the Required Consenting Parties, the Holders and the Purchase Money Notes 

Guarantors. 

(d) In connection with any such acquisition of title to Acquired Property by 

the Company (or any Ownership Entity) occurring after the Closing Date (by foreclosure, by 

deed in lieu of foreclosure, by power of sale or by sale pursuant to the Uniform Commercial 

Code, or otherwise), the Company shall obtain (or shall have obtained), during the period 

commencing six months prior to such acquisition and ending on the earlier of (i) sixty days after 

such acquisition or (ii) such earlier date as may be required in connection with the relevant 

exercise of remedies so as to comply with applicable Law and preserve rights to collect any 

Deficiency Balance), an updated Appraisal for determination of the Appraised Value (to serve as 

the basis for the initial Net Fair Value) of such Acquired Property. 

12.18. Administration of Acquired REO Properties. The following terms and conditions 

shall be binding on the Company and the Ownership Entities (and on the Manager's performance 

of its obligations hereunder) with respect to any Acquired REO Properties, in addition to any 

other terms and conditions concerning the same subject matter set forth in this Agreement and 

any ofthe other Transaction Documents: 

(a) Insurance. With respect to each Acquired REO Property, the Manager 

shall cause the applicable Ownership Entity to maintain, with financially sound and reputable 

insurers, insurance (including, as applicable, public liability insurance, property insurance, flood 

insurance, boiler and machinery insurance, business interruption or rent insurance and other 

insurance), in such amounts, with such deductibles, covering such risks and otherwise on such 

terms and conditions, in each case as are customarily maintained by property owners for other 

real property and buildings similar to such Acquired REO Property in the area in which such 

Acquired REO Property is located, all as determined by the Manager in accordance with the 

Servicing Standard and the provisions of this Agreement and the other Transaction Documents. 

Such insurance shall include an owner's title insurance policy, on the 2006 ALTA form (i) 

insuring the Ownership Entity's interest in the Acquired REO Property, (ii) in an amount equal 

to the Net Fair Value of the Acquired REO Property, and (iii) with such endorsements as are 

reasonably customary attached thereto. All insurance policies shall name the PMN Agent, the 

Manager and the Company as an additional insured or loss payee, as applicable, as its interest 

69 

SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
may appear. Each policy shall provide that such policy may not be cancelled or materially 

changed except upon thirty days' prior written notice to the Company and to the PMN Agent, 

and shall further provide that no act or thing done by the applicable Ownership Entity shall 

invalidate any policy as against the PMN Agent. 

(b) Leasing Covenants. With respect to each Acquired REO Property, the 

Manager 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) Zoning. The Manager 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 

each Required Consenting Party. 

(d) No Joint Assessment. The Manager 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 a 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) Maintenance, Repairs and Alterations. From and after the completion of 

any buildings or other improvements at an Acquired REO Property, the Manager 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) Ground Leases. With respect to any Acquired REO Property that is leased 

under a Ground Lease, the Manager 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 Manager 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 each Required Consenting Party unless such subordination is required under the 

provisions of such Ground Lease. 

(g) Additional Construction Covenants. In the event the Manager elects to 

cause the Company to fund any permitted construction with respect to Acquired REO Property, 

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Amended and Restated LLC Operating Agreement 
then the Manager shall cause each applicable Ownership Entity to pursue with diligence the 

construction of the Acquired REO Property owned by such Ownership Entity (i) in accordance 

with the construction, construction management (if any) and all other material contracts relating 

to such construction, and all requirements of Law, all restrictions, covenants and easements 

affecting such Acquired REO Property, and all applicable governmental approvals, (ii) in a good 

and workmanlike manner and free of defects, (iii) in a manner such that such Acquired REO 

Property remains free from any Liens, claims or assessments (actual or contingent), in each case 

for any material, labor or other item furnished in connection therewith and (iv) in conformance 

with the all other applicable requirements set forth herein and in the other Transaction 

Documents. 

(h) Acquired REO Property Generally. Notwithstanding any other provision 

of this Section 12.18 to the contrary, (i) in operating, managing, leasing or disposing of any 

Acquired REO Property, the Manager 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 Manager of any obligation 

elsewhere in this Agreement or any other Transaction Document, the Manager shall not be 

required to act in accordance with a specific provision of this Section 12.18 (other than 

requirements to obtain and maintain insurance) 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 Manager in the exercise of its reasonable discretion, or (B) not 

in accordance with the Servicing Standard. 

(i) Reports. The Manager shall furnish to the Initial Member and the PMN 

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

Acquired REO Property as the Initial Member or the PMN Agent shall reasonably request. 

12.19. Releases of Collateral. The Manager is authorized to cause the release or 

assignment of any Lien granted to or held by the Company on any Collateral upon payment of 

any Loan in full and satisfaction in full of all of the secured obligations with respect to a Loan, 

upon receipt of a discounted payoff as payment in full of a Loan, or upon a sale of the Loan to 

any Person, in each case as and to the extent permitted hereunder and under the Reimbursement, 

Security and Guaranty Agreement. 

12.20. Clean-Up Call Rights. 

(a) If, and only if, all amounts owing under the Purchase Money Notes have 

paid in full, and all other obligations to the FDIC under the Reimbursement, Security and 

Guaranty Agreement have been satisfied in full, or with the consent of the PMN Agent, the 

Initial Member shall have the right, exercisable in its sole and absolute discretion, to require the 

liquidation and sale, for cash consideration, of any remaining Assets held by the Company or any 

Ownership Entity at any time after the earlier to occur of (i) the tenth anniversary of the Closing 

Date and (ii) the date on which the then Unpaid Principal Balance is 10.0% or less of the Unpaid 

Principal Balance as of the Cut-Off Date as set forth on the Asset Schedule (such right to cause 

such liquidation and sale at such time, the "Clean-Up Call"). 

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Amended and Restated LLC Operating Agreement 
(b) In order to exercise its rights under this Section 12.20, the Initial Member 

shall give notice in writing to the Manager, setting forth the date by which the remaining Assets 

are to be liquidated by the Company, which date shall be no less than one hundred and fifty 

calendar days after the date of such notice. 

(c) The Manager shall proceed expeditiously to cause to be commenced the 

liquidation of the remaining Assets by means of sealed bid sales to Persons other than Affiliates 

ofthe Company, the Servicer or any Subservicer, or Affiliates ofthe Servicer or any Subservicer. 

The selection of any financial adviser or other Person, broker or sales agent retained for the 

liquidation of the remaining Assets pursuant to this Section 12.20 shall be subject to the prior 

approval of the Initial Member, such approval not to be umeasonably withheld, delayed or 

conditioned as long as the fees to be charged by such financial adviser or other Person, broker or 

sales agent are reasonable and such Person is not an Affiliate of the Manager, the Servicer or 

Subservicer. In the event the remaining Assets are not liquidated by the date specified in the 

notice provided by the Initial Member pursuant to Section 12.20(b), the Initial Member shall be 

entitled to liquidate the remaining Assets in its discretion and the Manager shall, and shall cause 

the Company to, cooperate and assist with such liquidation to the extent reasonably requested by 

the Initial Member. In the event the Manager or any Affiliate thereof desires to bid to acquire 

the remaining Assets, then the Initial Member shall be entitled to liquidate the remaining Assets 

in its discretion. In the event the Initial Member undertakes to liquidate the remaining Assets 

pursuant to this Section 12.20(c), all costs and expenses incurred by it shall be deducted from the 

Asset Proceeds and retained by the Initial Member and the remaining Asset Proceeds shall be 

distributed in accordance with Section 9.2. The first two sentences of this Section 12.20(c) shall 

apply to any liquidation by the Company of the remaining Assets pursuant to Article XI of the 

Reimbursement, Security and Guaranty Agreement. 

12.21. Certain Transfer Obligations. Without limitation of other obligations of the 

Manager with respect to the Contribution Agreement, the Manager agrees to cause the Company 

to comply with its obligations under the Contribution Agreement with respect to preparing, 

furnishing, executing and recording transfer documents with respect to the Assets (including 

special warranty deeds to convey the real property subject to any contract for deed and any 

Acquired Property to the Company). Any title curative work with respect to such Assets shall be 

at the Company's sole expense, provided that, as set forth in Section 4.10 of the Contribution 

Agreement, such expense shall constitute a Pre-Approved Charge. 

12.22. Seller Financing. The Manager may propose to the Required Consenting Parties 

that the Company provide one or more seller financed loans (i.e., the seller accepts a secured 

promissory note in lieu of cash in payment of all or a portion of the sales price of Acquired 

Property ("Seller Financed Loans") to purchasers of Acquired Property (or any portion thereof) 

(any borrower with respect to any such seller financed loan is referred to herein as an "SFL 

Borrower" and any guarantor, indenmitor or other Person having any obligations under the 

applicable Seller Financed Loan documents is referred to herein as an "SFL Obligor")). In such 

case, the Manager shall submit to the Required Consenting Parties at least sixty days prior to the 

first such proposed closing date of a Seller Financed Loan for the approval of such Required 

Consenting Parties (in its sole and absolute discretion), a written proposal (the "SFL Proposal") 

to offer such seller financing by the Company to any one or more SFL Borrowers, which SFL 

Proposal shall identify all material terms and conditions of the proposed Seller Financed Loan 

72 

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Amended and Restated LLC Operating Agreement 
(or program for multiple such Seller Financed Loans), including (i) the interest rate, (ii) the loan 

term, (iii) the loan-to-value ratio, (iv) the underwriting criteria for establishing the 

creditworthiness for any SFL Borrowers and SFL Obligors, (v) the form of Seller Financed Loan 

documents, which forms shall be similar to those of other prudent lenders financing collateral of 

similar type and size of the Seller Financed Loans collateral (the "SFL Collateral"), and 

including a form loan commitment letter specifying the conditions of making such Seller 

Financed Loan, (vi) the identity of the proposed servicer (if other than the Servicer, provided that 

in such case, such servicer executes a servicing agreement in the form of the Servicing 

Agreement and which complies with the Servicing Standard, this Agreement, and the terms of 

the other Transaction Documents), (vii) the amount and source of payment of any applicable 

servicing fee, and (viii) any other term or condition that any Required Consenting Party may 

determine in its reasonable discretion is necessary for it to consider approving or disapproving 

such SFL Proposal. Any such SFL Proposal and related specific items may include options or 

ranges as determined to be appropriate by the Manager for purposes of obtaining applicable 

approval permitting multiple Seller Financed Loans. If each Required Consenting Party shall, in 

its sole and absolute discretion, approve the proposed SFL Proposal, the Manager may cause the 

Company to provide applicable Seller Financed Loans meeting the requirements and conditions 

set forth in such approved SFL Proposal (and any applicable additional conditions required by 

any Required Consenting Parties in connection with their applicable approval). Each such Seller 

Financed Loan shall be evidenced by a promissory note (a "Seller Financed Loan Note") 

payable to the order of the Company that is secured by a mortgage, or a deed of trust, as 

applicable, in either case in recordable form for the jurisdiction in which the SFL Collateral is 

located, to secure the Seller Financed Loan Note. The Manager shall, or shall cause the 

Company to, promptly deliver the original Seller Financed Loan Note and the other original 

Seller Financed Loan documents to the Custodian. The Required Consenting Parties shall have 

thirty days from the time the SFL Proposal is delivered by the Manager according to Section 

13.6 hereof to approve or disapprove such SFL Proposal. If the Required Consenting Parties 

shall not have provided a response within such thirty day period, such SFL Proposal shall be 

deemed disapproved by the Required Consenting Parties. Furthermore, any such approval of an 

SFL Proposal for multiple Seller Financed Loans, if granted, may thereafter be revoked by any 

Required Consenting Party on a prospective basis (as to Future Seller Financed Loans not yet 

entered into by the Company pursuant to such applicable SFL Proposal). 

ARTICLE XIII 


Miscellaneous 


13.1. Waiver of Rights of Partition and Dissolution. Each Member (other than the 

Initial Member) hereby irrevocably waives all rights it may have at any time to maintain any 

action for division or sale of the Company Property as now or hereafter permitted under any 

applicable Law. Each Member (other than the Initial Member) hereby waives and renounces its 

rights to seek a court decree of dissolution or to seek the appointment of a court receiver for the 

Company as now or hereafter permitted under any applicable Law. 

13.2. Entire Agreement; Other Agreements. 

(a) This Agreement, together with the Annexes and Exhibits hereto and the 

other Transaction Documents (and any other agreements expressly contemplated hereby or 

73 

SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
thereby), constitutes the entire agreement and understanding, and supersedes all other prior 

agreements and understandings, both written and oral, between the Members or their respective 

Affiliates or any of them and the Company with respect to the subject matter hereof; provided, 

however, that any confidentiality agreement between the FDIC and the Private Owner or any 

Affiliates of the Private Owner (including by way of joinder) with respect to the transaction that 

is the subject of this Agreement and the other Transaction Documents (including each 

Confidentiality Agreement) shall remain in full force and eftect to the extent provided therein, 

except that the Company's rights under Article VI of the Contribution Agreement shall not be 

deemed a repurchase option for purposes of Section 2 of each Confidentiality Agreement (or any 

corresponding provision of any other such confidentiality agreement). The Members 

acknowledge that certain agreements or other instruments are being (or were) executed by the 

Company, the Members and/or Affiliates of the Members simultaneously or otherwise in 

connection with the execution of this Agreement and that notwithstanding anything to the 

contrary contained in the foregoing sentence of this Section 13.2, such agreements shall be 

effective and binding on the parties thereto in accordance with the terms thereof. 

(b) By executing this Agreement, the Manager agrees to be bound by the 

terms of the Transaction Documents pursuant to which the Manager is expressly required to take 

or omit from taking certain actions, as in each case, with the same effect as if the Manager were 

a party to such Transaction Document. 

13.3. Third Party Beneficiaries. Each of the FDIC, the Receiver, each Purchase Money 

Notes Guarantor and the PMN Agent is hereby constituted an express third party beneficiary of 

this Agreement with respect to those provisions of this Agreement which expressly grant rights 

or benefits to such Person and, as such, each is entitled to enforce such provisions of this 

Agreement as if such Person were a party hereto, provided that, (i) with respect to the PMN 

Agent, at such time when such Person ceases to be a Required Consenting Party (and subject to 

any rights of such Required Consenting Party that, by their terms or nature, survive such date), 

and (ii) with respect to each Purchase Money Notes Guarantor, upon the occurrence of the PMN 

Satisfaction/Defeasance Date (and subject to any rights of such Purchase Money Notes 

Guarantor that, by their terms 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 an Event of Default and receipt of reports and other information with respect 

to the continued operation of the Business, in each case (x) to the extent relating exclusively to 

the period following such date on which such Person so ceases to be a Required Consenting 

Party, and (y) except as to any rights or remedies relating to (or the exercise or non-exercise of 

which rights or remedies would affect) the repayment of the Purchase Money Notes in 

accordance with the terms hereof and of the other Transaction Documents, as determined by the 

PMN Agent and each Purchase Money Notes Guarantor, in each case in its sole discretion, and 

(z) unless and until the PMN Satisfaction/Defeasance Date thereafter shall be deemed not to have 

occurred as specified in the definition of such term (in which event, until any subsequent 

occurrence of the PMN Satisfaction/Defeasance Date, all of such specified rights set forth herein 

automatically shall be restored). Each Person ceasing to constitute the "Initial Member" under 

this Agreement (as a result of a Disposition of its LLC Interest) shall remain a third-party 

beneficiary of this Agreement with respect to Section 4.6 and, as such is entitled to enforce 

Section 4.6 as if such Person remained a party hereto. For the avoidance of doubt, in furtherance 

74 

SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
and without limitation of the preceding sentence, each Person comprising the "Initial Member" 

pursuant to the last sentence of the second paragraph of Section 4.6(a), and each other 

Indemnified Party (other than a Person that is an Indemnified Party solely by being a Related 

Person of another Indemnified Party), may enforce the provisions of Section 4.6 with respect to 

any Related Person in relation to itself (in its own name and/or in the name of and/or otherwise 

on behalf of such other Related Person). Subject to Section 11.1 and to the preceding provisions 

of this Section 13.3, (A) this Agreement is for the benefit solely of, and shall inure solely to the 

benefit of, the Members and the Company, and (B) this Agreement is not enforceable by any 

Person (including any creditor of the Company or of any Member) other than the Members and 

the Company. 

13.4. Expenses. Except as may otherwise be expressly provided herein or in any other 

Transaction Document, each Member shall pay its own expenses (including legal, accounting 

investment banker, broker or finder's fees) incident to the negotiation and execution of this 

Agreement and the other Transaction Documents, the consummation of the transactions 

contemplated by Section 2.3 hereof and the performance of its obligations hereunder. 

13.5. Waivers and Amendments. 

(a) This Agreement may be amended or modified, and the terms hereof may 

be waived, only by a written instrument signed by all Members and the PMN Agent (for so long 

as it is a Required Consenting Party); provided, however, that, following an Event of Default, 

from time to time this Agreement may be amended or modified and/or the terms hereof may be 

waived, in each case, by a written instrument signed only by the Initial Member (with the consent 

of the PMN Agent (for so long as it is a Required Consenting Party)) as long as such amendment, 

modification or waiver would not (i) adversely affect the Private Owner's or the Company's 

limited liability status; (ii) adversely affect the Private Owner's share of the Company's 

distributions, income, gains or losses; (iii) impose on the Private Owner any additional obligations 

or (iv) amend Section 3.13 or this Section 13.5; provided, further, that in no event shall any 

amendment, modification or waiver, limit or otherwise adversely affect the rights or benefits 

expressly granted in this Agreement to (x) any Person comprising the "Initial Member" pursuant 

to the last sentence of the second paragraph of Section 4.6(a) (and/or any other Related Persons in 

relation to such Person) without the express written consent of such Person so comprising the 

"Initial Member" or (y) a third party beneficiary of this Agreement other than the PMN Agent (to 

the extent such third party beneficiary is, and remains, a third party beneficiary pursuant to 

Section 13.3 above), and/or any Related Person in relation to such third party beneficiary, without 

the express written consent of such third party beneficiary. Except where a specific period for 

action or inaction is provided herein, no failure on the part of a Person to exercise, and no delay 

on the part of a Person in exercising, any right, power or privilege hereunder shall operate as a 

waiver thereof; nor shall any waiver on the part of such Person of any such right, power or 

privilege, or any single or partial exercise of any such right, power or privilege, preclude any other 

or further exercise thereof or the exercise of any other right, power or privilege. 

(b) Notwithstanding anything to the contrary contained elsewhere in this 

Agreement (including the foregoing Section 13.5(a)) or in any other Transaction Document, this 

Agreement (and the other Transaction Documents) are subject to amendment and modification as 

set forth in Section 8.4 of the Contribution Agreement. For avoidance of doubt, no legal fees or 

75 

SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
expenses associated with changes, clarifications or amendments to documents requested by the 

Private Owner shall constitute Reimbursable Company Administrative Expenses. 

(c) Notwithstanding anything to contrary contained elsewhere in this 

Agreement (including the foregoing Section 13.5(a)) or in any other Transaction Document), this 

Agreement may be amended or modified by a written instrument signed only by the Initial 

Member (with the consent of the PMN Agent) to the extent determined by the Initial Member in 

good faith to be necessary or desirable in order to facilitate any Disposition by the Initial 

Member of only a portion of the Initial Member Interest, or a Disposition by the Initial Member 

of the entire Initial Member Interest to more than one Person, including to provide for more than 

two Persons being members of the Company, provided that no such amendment or modification 

shall (i) adversely affect the Private Owner's or the Company's limited liability status; (ii) 

adversely affect the Private Owner's share of the Company's distributions, income, gains or 

losses; (iii) impose on the Private Owner any additional obligations or (iv) amend Section 3.13 

(other than to the extent that such amendment or modification amends or modifies which 

member or members of the Company shall constitute the "Initial Member" hereunder) or this 

Section 13.5. 

(d) Notwithstanding anything to contrary contained elsewhere in this 

Agreement (including the foregoing Section 13.5(a)), the parties acknowledge and agree that 

Section 8.7(b) is for the sole benefit of, and may be enforced only by, the PMN Agent, and may 

be amended or modified from to time by agreement of the Initial Member and the PMN Agent, or 

waived from time to time by the PMN Agent (in each case, without the need for any consent from 

any other party hereto). 

13 .6. 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 Section 13 .6), in each case 

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

manner provided in, this Section 13.6. 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, and (B) 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, however, 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. In no event 

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

From time to time, any party may designate a new address for purposes of notice to it hereunder 

by notice to such effect to the other parties hereto in the manner set forth in this Section 13.6. 

76 

SFR Venture 2011~1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
If to the Company, to: 

SFR Venture 2011-1, LLC 

999 181

h Street, Suite 1001 

Denver, CO 80202 

Attention: Michael P. 

E-mail Address: 

with a copy to: 

Mountain View Public Private Investment I, LLC 

999 181

h Street, Suite 1001 

Denver, CO 80202 

Attention: 

E-mail Address: 

If to the Initial Member, to: 

Assistant Director - Structured Transactions 

Federal Deposit Insurance Corporation 

550 171

h Street, NW (Room F-7015) 

Washington, D.C. 20429-0002 

Attention: Ralph Malami 

E-mail Address: RMalami@fdic.gov 

with a copy to: 

Supervisory Counsel 

FDIC Legal Division 

Litigation and Resolutions Branch, Receivership Section 

Special Issues Unit 

3501 Fairfax Drive (Room D-7102) 

Arlington, Virginia 22226 

Attention: Kathleen Russo 

E-mail Address: KRusso@fdic.gov 

Ifto the Private Owner (including in its role as Manager and/or Tax Matter 

Member), to: 

Mountain View Public Private Investment I, LLC 

999 181

h Street, Suite 1001 

Denver, CO 80202 

Attention: 

E-mail Ad.dre:ss: 

77 

SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
with a copy to: 

Mountain View Public Private Investment I, LLC 

999 181

h Street, Suite I 00 I 

Denver, CO 80202 

Attention: Susan E. Bow General Counsel 

E-mail Address: 

13.7. Countemarts; Facsimile Signatures. 

(a) This Agreement may be executed in any number of counterparts, each of 

which shall be an original and all of which shall together constitute one and the same instrument. 

It shall not be necessary for any counterpart to bear the signature of all parties hereto. 

(b) 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 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. 

13.8. Successors and Assigns. Except as otherwise specifically provided in this 

Agreement (including in Article VIII), this Agreement shall be binding upon and inure to the 

benefit of the Members and the Company and their respective Successors and assigns. Without 

limitation of Section 8.4, this Agreement, as in effect on the date that any particular Person shall 

cease to be Member, shall continue to bind such Person in relation to the period during which it 

was Member. 

13.9. Compliance With Law; Severability. 

(a) Compliance With Law. Except as otherwise specifically provided herein, 

each party to this Agreement shall obey and comply with all applicable Laws, as they may 

pertain to such party's performance of its obligations hereunder. 

(b) 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 

ill or (ill, such ineffectiveness shall not invalidate any of the remaining provisions of this 

78 

SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
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, 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 13.9(b) 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 13 .11. 

13.10. Power of Attorney. 

(a) The Private Owner does hereby constitute and appoint the Manager as its 

true and lawful representative and attorney-in-fact, in its name, place and stead to make, execute, 

sign, acknowledge, deliver or file any certificate, document or other instrument that the Private 

Owner is required to execute and deliver pursuant to clauses (i), {ill, (iii) or (iv) of Section 4.3 

hereof. The foregoing notwithstanding, the Manager shall not have any right, power or authority 

to amend or modify this Agreement. The power of attorney granted hereby is coupled with an 

interest and shall, subject to Section 13.10(b), (i) survive and not be affected by the subsequent 

death, incapacity, disability, dissolution, termination or bankruptcy of the Private Owner 

granting the same or the transfer of all or any portion of the Private Owner Interest and 

(ii) extend to the Private Owner's Successors, assigns and legal representatives. 

(b) The Company hereby grants to the Manager a limited power of attorney to 

execute all documents on its behalf in accordance with the Servicing Standard set forth above 

and as may be necessary to effectuate the Manager's obligations under Article XII until such 

time as the Company revokes said limited power of attorney. Revocation of the limited power of 

attorney shall take effect upon (i) the receipt by the Manager of written notice thereof from the 

Initial Member, or (ii) removal of the Manager in accordance with the terms of this Agreement; 

provided, however, in the event of such removal, the power of attorney granted hereunder shall 

thereafter automatically be vested in the successor or replacement Manager appointed in 

accordance with this Agreement. 

13.11. Governing Law. THIS AGREEMENT IS GOVERNED BY AND SHALL BE 

CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, 

EXCLUDING ANY CONFLICT-OF-LAWS RULE OR PRINCIPLE THAT MIGHT REFER 

THE GOVERNANCE OR THE CONSTRUCTION OF THIS AGREEMENT TO THE LAWS 

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. In the event 

of a direct conflict between the provisions of this Agreement and any mandatory, non-waivable 

provision of the Act, such provision of the Act shall control to the extent necessary to eliminate 

such direct conflict. Nothing in this Agreement shall require any unlawful action or inaction by 

any Person. 

79 

SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
13.12. Jurisdiction; Venue and Service. 

(a) Each of the Private Owner (for the avoidance of doubt, in any capacity, 

including as a Member and/or as the Manager) and the Company, in each case on behalf of itself 

and its Affiliates, hereby irrevocably and unconditionally: 

(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 (in the case of the Private 

Owner and for the avoidance of doubt, in any capacity, including as a Member and/or as the 

Manager) or any of its Affiliates commenced by the Initial Member, the PMN Agent, any 

Purchase Money Notes Guarantor or the FDIC arising out of, relating to, or in connection with 

this Agreement or any other Transaction Document, and waives any right to: 

(A) remove or transfer such suit, action or proceeding to any 

other court or dispute-resolution forum (other than the court in which the Initial Member 

files the action, suit or proceeding) without the consent of the Initial Member the PMN 

Agent, such Purchase Money Notes Guarantor or the FDIC, as applicable; 

(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 Chancery Court of the State of 

Delaware for any suit, action or proceeding against it (in the case of the Private Owner and for 

the avoidance of doubt, in any capacity, including as a Member and/or as the Manager) or any of 

its Affiliates commenced by the Initial Member, the PMN Agent, any Purchase Money Notes 

Guarantor or the FDIC arising out of, relating to, or in connection with this Agreement or any 

other Transaction Document, 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 Initial Member, the 

PMN Agent, such Purchase Money Notes Guarantor or the FDIC, as applicable; 

(B) 

State ofDelaware; or 

assert that venue is improper in the Chancery Court of the 

(C) 

an inconvenient forum. 

assert that the Chancery Court of the State of Delaware is 

(iii) agrees to bring any suit, action or proceeding by it (in the case of 

the Private Owner and for the avoidance of doubt, in any capacity, including as a Member and/or 

as the Manager) or any of its Affiliates against the Initial Member, the PMN Agent, any Purchase 

Money Notes Guarantor or the FDIC arising out of, relating to, or in connection with this 

80 

SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
Agreement or any other Transaction Document in only 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 Initial Member,the PMN Agent, such 

Purchase Money Notes Guarantor or the FDIC, as applicable, 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 Initial Member, the PMN Agent, such Purchase Money Notes Guarantor or the 

FDIC, as applicable; and 

(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 !3.12(a)(iii), to bring that 

suit, action or proceeding in only the Chancery Court of the State of Delaware, 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 Initial Member, the PMN Agent, such Purchase Money Notes 

Guarantor or the FDIC, as applicable. 

(b) Each of the Private Owner (in any capacity, including as a Member and/or 

as the Manager) and the Company, in each case 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 13.12(a) may be enforced in any court of competent 

jurisdiction; 

(c) Subject to the provisions of Section l3.12(d), each of the Private Owner 

(in any capacity, including as a Member and/or as the Manager) and the Company, in each case 

on behalf of itself and its Affiliates, and the Initial Member, hereby irrevocably and 

unconditionally agrees that service of all writs, process and summonses in any suit, action or 

proceeding pursuant to Section !3.12(a) or !3.12(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 

Section !3.6 (with copies to such other Persons as specified therein); provided, however, that 

nothing contained in this Section l3.12(c) shall affect the right of any party to serve process in 

any other manner permitted by Law; 

(d) Nothing in this Section !3.12 shall constitute consent to jurisdiction in any 

court by the FDIC (in any capacity, including as the Initial Member), other than as expressly 

provided in Section l3.12(a)(iii) and l3.12(a)(iv), or in any way limit the FDIC's (in any 

capacity, including as the Initial Member) right to remove, transfer, seek to dismiss, or otherwise 

respond to any suit, action, or proceeding against it (in any capacity, including as the Initial 

Member) in any forum. 

!3.!3. Waiver of Jury Trial. EACH OF THE PRIVATE OWNER AND THE 

COMPANY, FOR ITSELF AND ITS AFFILIATES, AND THE INITIAL MEMBER, HEREBY 

IRREVOCABLY AND UNCONDITIONALLY W AlVES ANY RIGHT IT MAY HAVE TO A 

TRIAL BY JURY OF ANY DISPUTE ARISING OUT OF OR RELATING TO THIS 

AGREEMENT OR THE TRANSACTION DOCUMENTS AND AGREES THAT ANY SUCH 

DISPUTE SHALL BE TRIED BEFORE A JUDGE SITTING WITHOUT A JURY. 

81 

SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
---------------------------------

IN WITNESS WHEReOF, f1e part ies have caused this Agreement to be executed by 

thei r res ccl :v~ officers or agents thc·e·-tnto du ly authorized 0'1the date first above writ:e·1. 

INITIAL M EM BER 

FEDERAL DEPOSIT nNSURANCE 

CORPORATION fN ITS CAPACITY AS 

RECEIVER FOR TilE FAILED BANKS 

By:___ _ _ ---- --------- Name: William P. Stewart 

Title: Senior Capitnl Markets Specialist 

COIVIPANY 

S FR VENTt.mE 20 11-L LLC 

By: 	 Federal Deposit Insur ance Corpora_io n in 

its capacity as Receiver fo r the Failed 

Banks, as So!c Member and Manager 

By: 

Name: il lian~ P. St wart 

Titl e: Senior Capital Mark ~ts Specialist 

PRIVATE OWNER 

[Signature l'age to Amcudcd and Restated LimitLtl .iability f. n lliJ<IIlY Agreement] 

Sf R V~ turc 20 Il-l .'tructured Tr<tns<tcfion 

Amended ami es~,n~d LLC Operating Agrt·ement 
IN '.VITNESS WI-I REOF, the pmiies have caused this Agreement to be executed by 

their respective officers or agents thereunto duly authorized on the date first above writ e!"l. 

INITIAL MEMBER 

FEDERAL DEPOSIT iNSURANCE 

CORIP'OH{ATION IN ITS CAPACITY AS 

RECEIV R FOR TH lfi'AfilLlEJQllBANKS 

COMPANY 

SFR VENTLJRE 2ijJI ~ .. ] , JLJLC 

By: 	 Federal Deposit Insurance rpo n in 

its capacity as Receiver for the FaiUcd 

B as Sole Member and Manager 

l~[O AINVI PQJHJLIC PRllVA'Q'E 

iNVESTMENT lf, JLJLC 

By: ______________ 

Name: Michae~, P" Morgan 

Title: CEO and President 

[Signature Page to Amended and Restated Limited I .iability Cumpany Agreement J 

SFR Venture 20ll-l Structured Tnmsaction 

Amended and Restated LLC Operating Agreement 
Annex I 

Member Schedule 

Member Percentage Interests Capital 

Contributions to 

Working Capital 

Reserve Account 

Initial Member 60% $ 423,269.70 

Private Owner 40% $ 282,179.80 

1-1 

SFR 2011~1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
Annex II 

Reporting and Access Schedule 

For purposes of the LLC Operating Agreement (and any incorporation of all or any 

portion of this Reporting and Access Schedule therein), references in this Annex II (i) to this 

"Agreement" shall mean and refer to the LLC Operating Agreement, (ii) to the "Applicable 

Agreements" shall mean and refer to the LLC Operating Agreement (or, as applicable, the 

Servicing Agreement or any Subservicing Agreement), (iii) to the "Beneficiaries" shall mean 

and refer to the Initial Member and the FDIC (and the term "Beneficiary" shall have a 

correlative meaning) or (iv) to an "Event of Default" shall mean and refer to an "Event of 

Default" as defined in the LLC Operating Agreement. For purposes of the Reimbursement, 

Security and Guaranty Agreement (and any incorporation of all or any portion of this Reporting 

and Access Schedule therein), (A) references in this Annex II (i) to this "Agreement" in this 

Reporting and Access Schedule shall mean and refer to the Reimbursement, Security and 

Guaranty Agreement, (ii) to the "Applicable Agreements" shall mean and refer to the Secured 

Parties Collateral Documents, (iii) to the "Beneficiaries" shall mean and refer to the PMN Agent 

and each Purchase Money Notes Guarantor (and the term "Beneficiary" shall have a correlative 

meaning), (iv) to an "Event of Default" shall mean and refer to an "Event of Default" as 

defined in the Reimbursement, Security and Guaranty Agreement, and (v) to the "Manager" 

shall mean and refer to the Company (except for the references to certifications of the 

"Manager" in the last two sentences of Section 3(b) and the provisions to Sections !(b) and~ 

of this Annex II, which shall continue to mean and refer to certificates of the Manager) and (B) 

the provisos to Section 3(b) of this Annex II shall be disregarded. 

I. Maintenance of Books and Records. 

(a) Maintenance of Books and Records. (i) At all times during the 

continuance of the Company, the Manager shall cause to be kept and maintained (including by 

the Servicer and any Ownership Entity and including records transferred by the Transferor to the 

Company in connection with its conveyance of the Assets to the Company under the 

Contribution Agreement), at all times, at the Company's chief executive office referred to in 

Section 2.4 of the LLC Operating Agreement, a complete and accurate set of files, books and 

records regarding the Assets and the Collateral, the Secured Parties Collateral and the 

Company's, any Ownership Entity's and the PMN Agent's interests in the Assets and the 

Collateral and the Secured Parties Collateral, including records relating to each Company 

Account, the Escrow Accounts, the disbursement of all Asset Proceeds and all other amounts 

disbursed from any Company Account. This obligation to maintain a complete and accurate set 

of records shall encompass all files in or subject to the Manager's or the Company's custody, 

possession or control pertaining to the Assets, the Collateral or the Secured Parties 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, the Collateral 

or the Secured Parties Collateral, all documentation relating to items of income and expense 

pertaining to the Assets, the Collateral or the Secured Parties Collateral, and all of the Manager's 

(and the Servicer's and any Subservicer's) internal memoranda pertaining to the Assets, the 

Collateral or the Secured Parties Collateral. The books of account shall be maintained in a 

manner that, and the Manager shall cause to be maintained a system of internal controls and 

II-I 

SFR 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
procedures that, provides reasonable and sufficient assurance: (A) that transactions of the 

Company are executed in accordance with, and only in accordance with, the general or specific 

authorization of management of the Manager consistent with the provisions of the LLC 

Operating Agreement; (B) that transactions of the Company are recorded in such form and 

manner as will: (x) 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; (y) permit preparation of the Company's financial statements in accordance with GAAP 

and as otherwise set forth herein and the provisions of the reports required to be provided 

hereunder; and (z) maintain accountability for the Company's assets, (C) regarding the 

prevention or timely detection of any unauthorized, and non-de minimis, acquisition, use or 

disposition of assets of the Company or any Ownership Entity; and (D) that any material 

information regarding the business or affairs of the Company is accumulated, recorded, 

processed, summarized and reported to management of the Manager in a timely manner. For 

purposes of the preceding sentence "transactions of the Company" include (without limitation) 

all transfers of funds out of, into, or between, Accounts (to the extent that the Manager has 

discretion with respect thereto), including all determinations as to the amount of the Working 

Capital Reserve Target or any discretionary Excess Working Capital Advance, and the making of 

any Bulk Sale. 

(ii) Without limiting the generality of Section l(a)(i) above, the 

obligation to cause to be kept and maintained a complete and accurate set of records as set forth 

in Section l(a)(i) in any event shall include the obligation to cause each of the following to be 

maintained (including by the Servicer or applicable Subservicers): (A)(x) accurate records 

reflecting the status of ground rents, Taxes, assessments, water rates, sewer rents, and other 

charges which are or may become a Lien upon any Acquired Property or Mortgaged Property (or 

any other Collateral) and the status of fire and hazard insurance coverage and all bills for the 

payment of such charges (including renewal premiums), and (y) with respect to any such 

Mortgaged Property (or other Collateral), accurate records, in reasonable detail, of all 

determinations as to whether (or not) to pay any of the foregoing on behalf of any Borrower, and 

the basis (and back-up documentation) for such determinations, (B) accurate records, in 

reasonable detail, of the results of site inspections of any Mortgaged Property or Acquired REO 

Property, (C) accurate records, in reasonable detail, of all determinations as to whether (or not) to 

transfer (or cause to be transferred) funds out of, into, or between, Accounts (to the extent that 

the Manager has discretion with respect thereto), and the basis (and back-up documentation) for 

all such determinations, (D) accurate records, in reasonable detail, of all determinations as to 

whether (or not) to effect any proposed Bulk Sale, and the basis (and back-up documentation) of 

such determination, and (E) accurate records, in reasonable detail, of all other determinations that 

are material to the Company. 

(b) Retention of Books and Records. The Manager shall cause all 

books and records at any time kept or maintained pursuant to Section 1(a) above to be and 

remain property of the Company, and to be maintained and retained until the date that is the later 

of ten years after the Closing Date and three years after the Final Distribution Date. All such 

books and records shall be available during such period for inspection by each Beneficiary or 

any of its representatives (including any Governmental Authority) and agents at the Company's 

chief executive office referred to in Section 2.4 of the LLC Operating Agreement at all 

reasonable times during business hours on any Business Day (or, in the case of any such 

II-2 

SFR 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
inspection after the term of this Agreement, at such other location as is provided by notice to the 

Beneficiaries), in each instance upon two Business Days' prior notice to the Manager. Upon 

request by any Beneficiary, the Manager shall promptly send copies (the number of copies of 

which shall be reasonable) of such books and records to such requesting Person or its designee. 

The Manager shall provide each Beneficiary with reasonable advance notice of the Manager's 

intention to destroy or dispose of any documents or files relating to the Assets and, upon the 

request of any Beneficiary, shall allow such requesting Person to recover the same (or copies 

thereof) from the Company and in the case the FDIC (in any capacity) and any other Beneficiary 

(that is not the FDIC) so request the same, the FDIC shall have the right to recover such 

documents or files, but any such other Beneficiary shall have the right to make copies of such 

applicable documents or files so long as such copies are made while such documents files remain 

with the Manager or the Company (and prior to recovery of the same by the FDIC). Any 

expense incurred by a Beneficiary and any reasonable out-of-pocket expense incurred by the 

Company in connection with the exercise by such Beneficiary of its respective rights in this 

Section l(b) to recover or make (or otherwise receive) copies of books, records, documents or 

files shall be borne by such Person so exercising such rights; provided, however, that any 

expense incident to the exercise of such rights pursuant to this Section 1 (b) as a result of or 

during the continuance of an Event of Default (i) shall in all cases be borne by the Private Owner 

(except to the extent such Event of Default is attributable exclusively to a Manager having been 

appointed by such Beneficiary (in any capacity) following removal of the Private Owner in such 

applicable capacity, or to any applicable Servicer (and any of its Subservicers) having been 

engaged by such Beneficiary (in any capacity), the Company or the applicable replacement 

Manager following such removal of the Private Owner as the Manager, in each case that is not an 

Affiliate ofthe Private Owner), and (ii) with respect to the PMN Agent and any Purchase Money 

Notes Guarantor, to the extent not borne by the Private Owner pursuant to the foregoing clause 

ill, shall be borne by the Company. 

2. Financial Statements. 

(a) Armual Financial Statements. As soon as practicable following, but no 

later than ninety days immediately after, the end of each Fiscal Year (commencing with respect 

to the 2011 Fiscal Year), the Manager shall prepare and deliver to each Beneficiary an audited 

consolidated balance sheet of the Company and the Ownership Entities as at the end of such 

Fiscal Year, and audited consolidated statements of operations and cash flow of the Company 

and the Ownership Entities for such Fiscal Year, each prepared in accordance with GAAP and 

accompanied by the Accountants' report and opinion thereon, which report and opinion shall be 

prepared in accordance with generally accepted auditing standards and shall not be subject to any 

qualification or exception as to the scope of such audit. If not included in any such audited 

financial statements, the Manager shall, together with the delivery of such audited financial 

statements, deliver to the Initial Member a separate schedule setting forth (separately) the value 

of each Loan and Acquired REO Property held by the Company or any Ownership Entity as of 

the end of the relevant Fiscal Year, in each case as reflected in (or otherwise consistent with) 

such audited financial statements. 

(b) Quarterly Financial Information. As soon as practicable following, but no 

later than forty-five days immediately after, the end of each quarter of each Fiscal Year (other 

than the last quarter of such Fiscal Year, and commencing with the calendar quarter ending on or 

Il-3 

SFR 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
about March 31, 2012), the Manager shall prepare and deliver to each Beneficiary the unaudited 

consolidated balance sheet of the Company and the Ownership Entities as at the end of such 

calendar quarter, and unaudited consolidated statements of operations and cash flow of the 

Company and the Ownership Entities for such calendar quarter (for the first such report, also 

covering the period from the Closing Date through the end of such calendar quarter), each 

prepared in accordance with GAAP. 

3. Additional Reporting and Notice Requirements. 

(a) Manager's Duty to Initial Member and Secured Parties; Delivery of 

Certain Notices. In addition to such other reports and access to books, records and reports as are 

required to be provided under this Agreement, the Manager shall cause to be delivered to each 

Beneficiary such information as is specified in Exhibit B to the LLC Operating Agreement (in 

addition to the Monthly Report) and such other information relating to the Assets, the Collateral, 

the Secured Parties Collateral, the Company, the Servicer and any Subservicers as such 

Beneficiary may reasonably request from time to time and, in any case, shall ensure that each 

Beneficiary is promptly advised, in writing, of any matter of which the Manager, the Servicer or 

any Subservicer becomes aware relating to the Assets, the Collateral, the Secured Parties 

Collateral, each Company Account, the Escrow Accounts, or any Borrower or Obligor that 

materially and adversely affects the interests of the Initial Member, the PMN Agent, any 

Purchase Money Notes Guarantor or the Holders under any Transaction Document. Without 

limiting the generality of the foregoing, the Manager (i) shall cause to be delivered to each 

Beneficiary (x) information indicating any possible Environmental Hazards with respect to any 

Collateral, Acquired REO Property or other Assets, (y) any notice or report provided to the 

Company or the Manager pursuant to Section 5.5 of the Servicing Agreement as in effect on the 

Closing Date (or pursuant to any other provision of the Servicing Agreement comparable to this 

Section 3(a)) and ill such information and certificates (including officers' certificates of the 

Private Owner) regarding compliance of the Private Owner with the requirements of Sections 8.2 

and 10.1 of the LLC Operating Agreement as such Beneficiary may request from time to time, 

and (ii) in any event shall immediately notify each Beneficiary in writing of any failure or 

cessation of the Private Owner to satisfy the requirements of Sections 8.2 and 10.1 of the LLC 

Operating Agreement, provided that any failure of the Manager to so provide such immediate 

notice under this clause (ii) shall not be deemed a breach of this Agreement so long as the 

relevant information with respect thereto is included in the applicable Monthly Report for the 

period including the date on which such failure occurred (so long as such Monthly Report is 

timely delivered in accordance herewith). To the extent that any Beneficiary requests 

information which is dependent upon obtaining such information from a Borrower, Obligor or 

other third party, the Manager shall cause to be made commercially reasonable efforts to obtain 

such information but it shall not be a breach by the Manager of this Agreement if the Manager 

fails to cause such information to be provided to such Beneficiary because a Borrower, Obligor 

or other Person has failed to provide such information after such efforts have been made. 

(b) Monthly Reports. On or prior to the day which is five Business Days prior 

to the Distribution Date for each month, commencing on the Distribution Date following the 

calendar month in which the Closing Date occurs, the Manager shall deliver or cause the 

Company to deliver to the Paying Agent and to each Beneficiary the Monthly Report (in the 

form set forth in Exhibit B to the LLC Operating Agreement) with respect to the relevant Due 

II-4 

SFR 2011-l Structured Transaction 

Amended and Restated LLC Operating Agreement 
Period, which Monthly Report shall include the Cash Flow and Distribution Report specifying 

the amounts and recipients of all funds to be distributed by the Paying Agent on such 

Distribution Date; provided, however, that (unless the Company and the Initial Member agree 

otherwise) the Initial Member will prepare and deliver to each other Required Consenting Party 

and each Purchase Money Notes Guarantor and to the Paying Agent each such Monthly Report 

(including a Cash Flow and Distribution Report) on behalf of the Company for all Due Periods 

ending on or before the last occurring Servicing Transfer Date (provided, further, however, that 

with respect to each such Monthly Report, the Manager shall (with respect to information 

relating to all Groups of Assets other than those for which the Interim Servicing Period has not 

ended) cooperate with the Initial Member in preparing such Monthly Report or will provide to 

the Initial Member on a timely basis information needed to enable the Initial Member to prepare 

the Monthly Report). For the Distribution Date immediately preceding the Maturity Date for 

each Class of Purchase Money Notes, the Manager shall also deliver to the Paying Agent and 

each Beneficiary a Maturity Date Report with respect to such Class of Purchase Money Notes. 

The Manager also shall cause each Beneficiary to be furnished with the Custodian and Paying 

Agent Report in accordance with the terms of the Custodial and Paying Agency Agreement. 

Each Monthly Report (including the Cash Flow and Distribution Report and the Maturity Date 

Report, as applicable) prepared and delivered by the Manager shall be certified by the chief 

financial officer (or an equivalent officer) of the Manager. Each Monthly Report prepared and 

delivered by the Manager shall also include a certification ofthe Manager that all withdrawals by 

the Manager from the Collection Account during such Due Period were made in accordance with 

the terms of this Agreement and the Custodial and Paying Agency Agreement. 

(c) Annual Compliance Certificates. The Manager shall, and shall cause the 

Servicer and any Subservicer to, deliver to each Beneficiary on or before March 15 of each year, 

commencing in the year 2012, an officer's certificate stating, as to the signer thereof, that (i) a 

review of such party's (in the case of the Manager, for the avoidance of doubt, in any capacity 

under this Agreement) activities during the preceding Fiscal Year (or other applicable period as 

set forth below in this Section 3(c)) and of its performance under the Applicable Agreements 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 (in the case of the Manager, for the avoidance of doubt, 

in any capacity under this Agreement) has fulfilled all of its obligations under the Applicable 

Agreements in all material respects throughout such year (or other applicable period as set forth 

below in this Section 3(c)) 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 cover the period commencing on the Closing Date (and with respect to 

each Asset, shall include relevant information with respect thereto for the period commencing on 

the Servicing Transfer Date for such Asset) and continuing through the end of the 20 II Fiscal 

Year. In the event the Servicer or 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 applicable Servicing 

Transfer Date through the end of the 2011 Fiscal Year), such party shall provide an officer's 

certificate pursuant to this Section 3(c) with respect to such portion of the year (or other 

applicable period). 

(d) Annual Compliance Report. On or before March 15 of each year, 

commencing in the year 2012, the Manager shall (including by causing the Servicer and each 

II-5 

SFR 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
Subservicer to) provide to each Beneficiary a report prepared by a nationally recognized firm of 

independent certified public accountants to the effect that, with respect to the prior Fiscal Year 

(or other applicable period as set forth below), such firm has examined certain records and 

documents relating to compliance with the servicing requirements in the LLC Operating 

Agreement and the Servicing Agreement and that, on the basis of such examination conducted 

substantially in compliance with either the Uniform Single Attestation Program for Mortgage 

Bankers or Item 1122 of Regulation AB, such firm is of the opinion that the Manager's or its 

Servicer's or Subservicers' activities have been conducted in compliance with the LLC 

Operating Agreement (including, to the extent applicable pursuant to Section 12.3(e) of the LLC 

Operating Agreement, Regulation AB) and the Servicing Agreement, or that such examination 

has disclosed no material items of noncompliance except for (i) such exceptions as such firm 

believes to be immaterial, and (ii) such other exceptions as are set forth in the report. The first 

such reports shall cover the period commencing on the Closing Date (and with respect to each 

Asset, shall include the relevant information with respect thereto for the period from the 

applicable Servicing Transfer Date) and continuing through the end of the 2011 Fiscal Year. 

(e) Audits. Until the later of the date that is ten years after the Closing Date 

and the date that is three years after the Final Distribution, the Manager shall, and shall cause the 

Servicer and each Subservicer to, (i) provide any representative of any Beneficiary (including 

any Governmental Authority), during normal business hours and on reasonable notice, with 

access to all of the books of account, reports and records relating to the Assets, any Collateral, 

any Secured Parties Collateral, the Servicing Obligations, the Company Accounts, the Escrow 

Accounts, any account created under the Servicing Agreement, disbursements under the 

Custodial and Paying Agency Agreement, distributions hereunder or any other matters relating 

to, or the rights or obligations pursuant to, this Agreement or the other Transaction Documents; 

(ii) permit such representatives to make copies of and extracts from the same, (iii) allow each 

Beneficiary to cause such books to be audited by accountants selected by such Beneficiary, and 

(iv) allow each Beneficiary's representatives to discuss the Company's, the Manager's the 

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

Collateral, the Secured Parties Collateral, the Servicing Obligations, the Company Accounts, the 

Escrow Accounts, or any other matters relating to this Agreement, the other Transaction 

Documents, or the rights or obligations hereunder or thereunder, with the Company's, the 

Manager's, the Servicer's and any Subservicer's officers, directors, employees, attorneys and 

accountants (and by this provision the Company and the Manager hereby irrevocably and 

unconditionally authorize the respective accountants of the Company, the Manager, the Servicer 

and any Subservicer to discuss such affairs, finances and accounts with such representatives). 

Any expense incurred by any Beneficiary and any reasonable out-of-pocket expense incurred by 

the Company in connection with the exercise by such Beneficiary of its rights in this Section 3(e) 

shall be borne by such Beneficiary; provided, however, that any expense incident to the exercise 

of such rights pursuant to this Section 3(e) as a result of or during the continuance of an Event of 

Default (i) shall in all cases be borne by the Private Owner (except to the extent such Event of 

Default is attributable exclusively to a Manager having been appointed by such Beneficiary (in 

any capacity) following removal of the Private Owner in such applicable capacity, or to any 

applicable Servicer (and any of its Subservicers) having been engaged by such Beneficiary (in 

any capacity), the Company or the applicable replacement Manager following such removal of 

the Private Owner as the Manager, in each case that is not an Affiliate of the Private Owner), and 

II-6 

SFR 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
(ii) with respect to the PMN Agent and any Purchase Money Notes Guarantor, to the extent not 

borne by the Private Owner pursuant to the foregoing clause (i), shall be borne by the Company. 

4. No Duplicate Reports. Notwithstanding any provision in this Annex II to the 

contrary, the Manager shall not be required to deliver duplicate copies of the reports as described 

in this Annex II to the FDIC (in any capacity as a Beneficiary), so long as the FDIC (including, 

as applicable, as Receiver) is acting in its capacity as any such Beneficiary, and during any such 

period shall only be required to deliver one copy of each such reports addressed to the FDIC (in 

any such applicable capacity) with a notation on the envelope that such reports is being delivered 

to the FDIC in its capacity as each such applicable Beneficiary. 

II-7 

SFR 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
EXHIBIT A 

FORM OF 

CERTIFICATE OF FORMATION 


OF 


SFR VENTURE 2011-1, LLC 


Pursuant to and in accordance with the provisions of Section 18-201 of the 

Delaware Limited Liability Company Act, the undersigned hereby certifies that: 

FIRST, the name of the limited liability company is SFR Venture 2011-1, LLC 

(the "Company"). 

SECOND, the address of the registered office of the Company in the State of 

Delaware is Corporation Service Company, 2711 Centerville Road, Suite 400, Wilmington, DE, 

in the City of Wilmington, County of New Castle. The name of the registered agent at such 

address is Corporation Service Company. 

IN WITNESS WHEREOF, the undersigned has executed this Certificate of 

Formation of the Company on this Uth day of__, 2011. 

By:______________ 

Name: __~~~-----------------------­ Title: Authorized Person 

A-1 


SFR 2011-1 Structured Transaction 

· Amended and Restated LLC Operating Agreement 
__ 

Exhibit B- SFR 2011-1 Venture Structured Transaction 

EXHIBIT B - FORM OF MONTHLY REPORT 

CASHFLOW AND DISTRIBUTI()I\I REPORT. . . -. - .. - . ~-- ~ 

[insert date] _ __ ·-- ··-- I ···-

T: ~r~~~i~~~~~~~s . - - . - . . .- ... ..• ·...+ rom-+_: • 


(+)iA.sset sale proceeds, including shOrtSaies ·-- -- ·-- -[_ ·--, ­

-

(+) 

(+) rtv~ortgage 

REO liquidation 

insurance 

proceeds 

claim proceeds 

--. 

--_-

--

_ 

--- =+=-- ' - ---:- ~ I ­

(+) Servicing Expenses and Interim s8rViCiil-g Expenses Recovered---- -- ---- - r­ . (+l ··-Other Asset Proceeds (including late fees and penalties)-_-_- - i _ 

(+) !Any indemnity payments made to the Company under Sect1on 13 1(c) or (d). . . - [ 

f---'-'-lof.Cus.todial-and F'ay.i.ng···.AgencyAgreement("CUsi:odiiiAQreement"} ___:_------1 _ -. ....• __ (+) llnterest and earnings from Collection Account·-- ·-- ___ ::.:.=r-_ ~SSCOLLECTIONS - l 

- ;Otherdep~~n-=nt---=---- ---=--- . - · _ -_ -[ c=---=+=-­

{+) !Transferred from Working Capital Reserve Account: . ·--. ·--­ =tFor payment of Working Capital Expenses - ; f-­ · F.or req-uir.edrele .. ase. ofWorking caf)ital- Reserve Account funds -__ .. -. ·I _ (+) Excess Working Capital Advances ··--·· ___ ·--- .. _ 

(+) Repurchase Price for repurchased assets i ­

<l~~~;~~::::~coU". ..· _ . __I - -1­

<-l Interim Servicing Expenses paid_ __ ---· __ ___ =±= 

(-) l Pre-Approved Charges I - I 

H =:~"::::~:mRo<sm""''o' -t== -~·. 1-+-; - -- -- -- -­ jDistributiOiiS{outside of Priority of Payments in Section 5.1(b) of Custodial Agreement) ---- ' ­

---~ _-_-_- -----+1__, Special Distribution of Repurchase Price for repurchased assets: ____ 

Purchase Money Note Asset Value ...__ ___ ---. ·--- [ -~ 

_l T_o_H_olde_r_s_.. ··--.. ·-- ·--· --·· ___ I ----· 

·­ ·-··.. 14~-~-~_i;~:YM_Pe_a~_db_·~~Mem_b_e~rs~:-.. -------- ·­ ···l· •---

T o Private Owner :+-­

---+1-·~""A_d::ju_s_t-:-:--:..t:_:::~_::u-i-ty~A-·-s_s_e_t::V-a-lu-e --- - . .. . . - =f=~===-=.-__ - -" ............
 ·····=t=__To ln_it_ia_lMem_b_er_ To Private Owner . - ---- ----.. ~==~--=·--,------ Total r- ·-- --- ··--­ 1
---

--

Exhibit B - SFR 2011-1 Venture Structured Transaction 

Distributions pursuant to Priority of Payments in the Custodial Agreement ' ___j_ 


1
 - c-u-.s_t_o_d_ia.n_a_n_-d_P_ayi-ng--A-ge-nt-_F_-e_e_s_a-nd 

under Section 13.1 (a) of Custodial Agreement) 

___ E_x_pe_n_._se-s ..-_(_a_n_d a_n_y_-i_n_de .. m-n-_it_y_·_pay-m-_e-_nt_s . il - --·-- _ _L --. 

Interim Servicing Fee to Initial Member - , (1) 

- :Interim Management Fee io Manager-- ------~ _-~- _ -~ _- - I(2}_ 

-J;nagement Fee to Manager__ __ __ __ __ __ l,-- --­

r- payment of Excess Working Capital Advances to Manager __ __ ___ ·--- - r-­

plenishment of Working Cap1tal Reserve -~~ ! Purchase Money Note Issuance Fee- -- -- -- -- --- ---- ----- (3) 

--- 1Reimbursement payments(including interest thereon) to Purchase Money Note --- ··--·- r­ --. Guarantors due under any Purchase Money Note Guaranty__ ___ ·I---.::__~·,(4·.) . f-- Interest due on Purchase Money Note_ --·· __ __ !Principal due on Purchase Money Note 

.·· I TOTALDISTRIBUTIONSDUE . - --------

f- INETDISTRIBUTABLECASHTOMEMBERS . _· . - . . ···=1·· =--l_· 

' lo:;;-,:;::~;.:';:',~~.":J::;,~:. '"""'•"""" lee '""""' __:_ . I 1$ -.-.. · .. :_ ....._I. -.. TDfStribution to Private Owner (at proportionate LLC interest) 

~±::~:::Z"':-':00~~ I• ···I _ ··- ICustodial and Paying Agency AC,reem~nt --·· ___ ___ ----:-_ . =-1: 

'"''"" "RViCiNGm cALCoumON -_ -=.._ - _ -~. - - Loans 

UPB, beginning of Due Period (w1th resp~ct to Loans in any Group of Assets~ -- -~

-. whic.h S.erv1cing Transfer Date has not oc.curredas.of f.~rst da.yin Due. P.eri_ociL_ _,_$_·.·· ____- _ . 

]Times interim servicing fee rate __ ___ __ __ ___ . l ___ 0.25% 

~~~ ~~';;,~er of days in Due Period/360 (commencing on the day following the/ _ I ( ) 

1 

- ___l_-_-_- Portion of interim servicing fee with respect to Loans-rL ·- __~ 

::- Ac!i~JlredPrOPerty -----~-~---~_-I --_ -L= 

Net Fair Value, beginning of Due Period (with respect to Acquired Property in any I I 

Group of Assets for which Servicing Transfer Date has not occurred as of f~rst day in 1 _ 

_____jJ:Jue Period) __ __ __ __ __ __ __ --~' $ __ 

t-- Times interim servicing fee rat_e__ ·-- __ __ ·-- ---· __ . 0 25%1-_ 

Times number of days in Due Period/360 (commencing on the day following the 

Cutoff Date) (1) t-- --- ··-- -- --- ·-- --· -- -- --- Portion ofinterim servicing fee with respect to Acquired Property $ - I . ­

--~-i~~-;~~-~~-:~:~~-=-;-:~~~-1-~N-:G-:~~-~=-~-u=~~~~-~~-~-ul~~dt-~--~-P:~~-.. _· - •. --- 1: - I .

r- IINTERJ--:v,ANA~MEN--;;EECA---:ULATI---:----- -----._ ---- I·-­ --- I -

~ns - . ­ ·------I--·+­
---

Exhibit B- SFR 2011-1 Venture Structured Transaction 

UPB, beginning of Due Period (with respect to Loans in any Group of Assets for I 	 I 

~--·_ I~~i::: ~~::~n:e:~~~~e;e~~=:as not occurred as of first day inDue Period) _ __$ ______ I .....

1 

=fimes number()f days i~~~~::~~~t~~~~~~,:~::;n~~e~~:;~gr~=~~ctto Loans I 

1 

$- - ( 

2

)

_:__ IACcl--=.~pro~ --=--- ~~~-- -------~-----· ~r -__ 

Net Fair Value, beginning of Due Period (with respect to Acquired Property in any j-- --... :--­ ·-ig~~u~;;~~sets for which Servicing Transfer Date has not occurred as offirst day in I $ ___ _j_ 
 _-__ rimes interim servicing fee rate .. ____ __ ____ ___ ____ _ T ____ o.2s%1 ­

_ .. T-imes numb___ er of day_s__ inDue. Period/.36.0 (co._mmencing on Closin.g Date) _____ I ----=-_.~ (~--...

Portion of interim management fee with respect to Acquired Property-""-11-'$:;..,.._____~ 

f--	 ·_I Portion of interim management fee with respect to Loan~ . - ·-___· -I $ -- ..- I m 

__ Portion of interim management fee with respect to Acquired Property _- ____e--,_~·==~~ 

f- ~OTAL INTERIM MANAGEMENT FEE DUE TOMANAGER___ __ ----1 ~$~=-~== 

r--r:a~NTF~ALC~TJO~- . · _ . _ __ - .. _ . · __ r- _ _ 1 

=!

UPB, beginning of Due Period (with respect to Loans in any Group of Assets for 

. which Servicing Transfer Date has occurred as of first day in Due Perio_clL_ ____ $___ __-_ _ 

Times Management Fee rate __ __ __ __ __ ___ ___ ~50% __ 

Times number of days in Due Period/360 1 ­ --- .- _-_- Portion of management fee with respect to LoansI $ ·_ ·· ­

Ac!!Uir&d PrOiiertV -- --- -- --· -- -- -- I --­

- Net Fair Value, beginning of Due Penod (with respect to Acquired Property in any J, Group of Assets for which Servicing Transfer Date has occurred as of first day in 

~~,::~::~.•,, - -	 I : - _o ;,, ­ __ Times number of days in Due Period/3~ __ ___ ___ ___ ­

__ Portion ofmanagement fee with respect to Acquired Property ~(5) 

1 

_ 	 --~onofmanagementfeewithrespecttoLoans-_~ _- ,-$--~ • 

(+) Portion of management fee with respect to Acquired Property ~C: ­ - TOTAL MANAGEMENT FEE DUE TO MANAGER -- --- $ ­ --· ·-- --- ·--· -- --. -- ···--· ·-· --	 ­

--· ·-- ··-- ·--- ·--· -- --· -- -- -- -- I 

Notes to Cashflow and Distribution Report: ____ _____ ___ ___ __._ ___---:::r_ 

(1) 	 IApplicable.onl·y· to the ..lnterim Serv .. icing Period with _respect to. a Group of As.. se·t-·s, com.. mencing on the. day I 


immediately following the Cutoff Date. 


(2) IApplicable only to the lnt~rim Servicing Perfod with respect to a Group of Asset;, comme~cing on th~ .. 

_ . !closing Date. --.. ··--- ____ ___ ____ ·--·· ··--- ____ _____ __i__ 

(3) _[PMN Issuance Fe.e shall be p.. aid to .. the Tran.sferor on each Distri.butio·n· D.ate prior to the G-uaranty lss.uan·c·+-··· 

Date, and to the Guarantor on each Distribution Date on or after the Guaranty Issuance Date. 

(4) ;Only aeplicable after the Guaranty Issuance Date-:--...:=-----___:__- _j_---=- --­ (5) 	 The portion of the Management Fee calculated with respect to any Acquired Property is payable for a 


maximum of three (3) years after the title to such Acquired Property is first transferred to the Company (or 1 


relevant Ownership Entity) or such longer period as the Initial Member may expressly approve in its sole 


1discretion on a case-by-case basis based on the applicable disposition plan, if any, for such Acquired 


IProperty prepared by the Manager. 

Exhibit B- SFR 2011-1 Venture Structured Transaction 

1- +-- -!~ 
Exhibit B- SFR 2011-1 Venture Structured Transaction 

ALLOCATION OF 1INTEREST AND PRINCIPAL PROCEEDS I 


Part 1- Calculation ofamount payable for items in Section 5.1(b) andTc/of the--· I --- ... --1,-· 


Custodial Agreement -----· ---·· . ___ ___ ____ 


__ [Gross Collections ____ . ···-- i $ ·-·---! 
 _ [Less Principal collectio11s _ . _- -----~ ____ .. ----+ - 1-­

-----=]Less Loan Sale proceeds, including short sales .. ____ --· ---··/ _____ .. ­-r--

Less Mortgage insurance claim proceeds __ ·-- ___ _____ ____ _ . ___-_ 


-- Less Liquidation proceeds ! - __ 


- . 

1 

f~:~:~~:r::i~;e~;:;~~:~:i~~c~:;t:~~:;e~:n1~~~unt- · ·--.__ ·- -I_ --- : i ~ 

I-- rnteres~Proceedsavailable ___ ___ ___ ____ T= ==-±= 

Payabf.e p.urs.uantt..o '"'""' ' ~fuo C""'"'"' AQ-m<"'- _- _ ~-. ·.·.··--.. _! !Serv1c1ng Expenses ___ ____ ___ ___:__ 1·­ --~r~~~~~~:~i~gh;::nses _____ ·-- . --· -.__ --.-·.-. ~ 

~ To~~t~~!1n;;:z:~~:i::~;~~~nterestProceeds . _ ··- -·· ___ ·__ -~=1:. · ·· : 1 -·· 

~ ­

--- -----·· ---- ----.. ----

=i

Items payable first from Interest Proceeds, then Principal Proceeds ___ _____ -+--I 

Payable pursuant to Section 5.1 (b) and (c) of the Custodial Agreement: 1 

ustodian and Paying Agent Fees and Expenses___ -- - ----·- i 

nterim Servicing Fee to Initial Member _-_-- .=}=·­ fnterim Management Fee to Manager ___ --~-.·. 

I---!'-!Management Fee to Manager --- --- --------­

1--- [Repayment of Excess Working CapitaiAdvances toManager . __ _ , ·---­

1Replenishment of Working Capital Reserve .. . . .... I -~ rchaseJVloney Note Issuance-Fee ... ·.· --- --... -. ---... -· . I -_ ·/ -­

i.m.-b... ursement.payments. (includ·i·ng interestther·e· on} to ..Purc.. hase Money. Not~eF-. _ er_es_tdue on_P_ur_chase Money Note ····--· ·---·· ... _ =---==="= -

-

~- Ex~ess (Shortfall} before Recategorized lnterestProceeds ____:_____. ··- . - ­

ubtotal, amounts due from Interest Proceeds ==~-~=+--1 

- 'I Less: Recategorized Interest Proceeds with respect to Prior Distribution Dates (up I

I'" om.ount ofExcess. lnte.r ..e.st on previous row}__ ·----· ·--k= _ . _ Rem_a_in_ing Interest Proceeds·-- ·--· ··--.. [ ~=-=-~~=-+- -

-

I 

I 

' 

.

T 

.. . ~117tlf--=tfiiil-- - -_ -- - --~$_---­

! PrinCipal collections on loans ____ ­ -~ Sale proceeds, includingshort sales ____ ­

---~ortgage insurance claim proceeds ____ ---.. !I ­

_J:i<lu_idation proceeds _--·· -

Less Required Funding Draws I ­ e----····~~+-P-rin-:::c_ip_al P-ro-ce-e-ds Ava'i'la~b~le____ ·---~-- --_--:__--:__-__ --------~·~ ­

------+ 

i~===~-=+--

l 

-

--­

-­

(-} 1 Shortfall in Interest Proceeds for current Due Period (current period Recategorized I 

!Interest Proceed-::s:!.}___ - --j'-­

-(+) [ RecategOrized Interest Proceeds, with respect toa;;yp.;or Distribution Date I ___ 

-· -~Net Principai_F'r<Jc:eeds for Allocation (not less thanzero)__. _ --.------- -~$=-=-~~~-·~ 

-~i~cipal due on Purchase Money Note, untii_N;,-tes reduc_ed tozero ----IIJ$~~~=-=-~-~-~ 1­
Exhibit 8 - SFR 2011-1 Venture Structured Transaction 

RecatLorized tnterestProceeds .. ____ ____ ____ ______ ____ -~------ ---1 ~ __ IRecategorized Interest F'_roceeds,with respect to any prior Distribution Date__ __l_!_ -- _- --~ ­

~-) l~~~~:: 1;;~~:~r:rocee~s for current Due Period, up to amount of Recategorized ____I__ __ (+) !Interest Shortfall for current Due Period, up to amount of Principal Proceeds '_-4--_ 

- Available!,=~~== -- --- ---- --- ---- --- --- ---- -- r$ 1 

1 

Recategorized Interest Proceeds after this Distribution 
Exhibit B- SFR 2011-1 Venture Structured Transaction 

Loan & ~E() Monthly Rollforward Report .. ! _ -+ -_ ·­ ~Tr••dY~d . . . . -t- ;:f:::~~~ '"..f'-l--=- _ --=---_+'ASS'"" ~AMOUNT_ Unpaid principal balance, beg. of Due Period . . ~ - . $ ­

.::: I::r.:'l:·,~.:r' '"""'"'"' '""""~""' -1 • ,-~- -_ < 

_j:) ·1 Short sale proceeds-=---··-.. -·· ----:-- 1· ._:____ - ­

.. (-) ;Mortgage insurance proceeds .. ···--. ... . . --·· ::.__ 

(-) UPB,transferstoREQ_ ·--· ··--·····i ··--- ·-- --.­ i! ~~~:::t:%i~~·J~ ~··"''""' --i-- ~-- ..~ .t:Jnpairprincipal balance, end of Due Period ·. . - i~-.- - $ ·•· .·· . ­

:t.JoCoMMnM'NTSJU'I •.•. ··. _ lussmj AMOUNT 

.LJnfunded commitments balance, beg. of Due Period _ . - I$ _ ·---­

c-J-l !Commitmentsfunded ··--· . ... -=----1- --· ._-_ _(-) Commitments released on loan payoffs r-- ::......, 1 . . . . ­

Unfun.ded commitments balance, end of Due Period I . =r:= . .. - ·--· 

·--· 

---· 

NetFair Value of REO, beg. of Due PericJ<j__ __ - $ 

(+) UPB on REO transfers in I - ­ ~i-) AdjiiS!rTients to Net Fair Value --=------ I -~=-- -­ (+) Capitalized post-acquisition costs 

<FNeliiquidation proceedS ·--- ··-· ---_-· ·--·· 

(+i-) IRealized Gain (Losses) __-...._-_._ 

Net Fair Value of REO, end of Due Period --· --· ·--1 

~"']'ENIL BAL<N"'' --==---. t."•"i 

$ 

:· AMouNT=

Deficiency balance, beg of Due Period .--. I ---.. - +·$ .. . . ­

_(-) jColl.ectionsa.ppliedtodefic·i·ency ..-~.··-. ··-...-.. -·· ----::-_ ·· __ 

_ (.:•:LBalance, new deficiencies.--· . I ·--·· - .--·· ··--.- . 

(-) !Other non-cash resolution ··-- --1 -[ .. .. - Deficiency balance, end of Due Period - I $ - .. 

·-­
Exhibit B - SFR 2011-1 Venture Structured Transaction 
--

Exhibit B - SFR 2011-1 Venture Structured Transaction 

__l__ -· -· ·- ____ -· -- --L -- ··-- I -


Working Capital Reserve Account i i 


;,::~~ ~~? Forward ___:_--- - _ _ - _- · - · j ·•· · . .· -· . 1- . 

~T_-_ -- ~- ·- -- --- ·-·-- Balance, beginning of Due Period 	 =-t -__l_i12_

-_j_------=- -_---------:-_---=------ --------=---- ---=------­

c--i+) 	IInterest and earnings on Working Capital Reserve Account . ·--· __ -

I 

, 

­

1 

Transfers to/from Collection Account during the Due Period_:_ __ ___ _ ··- _ I(Z_·)·.· c-1-) iPaymentofWorking CapitaiExpenses__ ___ ___ ____ 

-[ F~~ ~~~~~citi~u~~:~~~iod ·· ··-- -- ·--· ·-- ·-- ------ _ . -~· (+i plenishment (release) of Working Ca-pital Reserve Account-- ---· ----­

:funds from/(to) Collection Account ­

;::t:~::::::;~: .~-- ~·"~"' . . .. -t -- =+- ­ (1 	/Required advance to pay Working Capital Expenses for this Due --r-­

(+ 	 1::::nishment (release) of Working Capital Reserve Account-l. ' 	 . ----·· _- -_ .. i .-.-..­ unds from/(to) Collection Account 	 __ 

_- .._1-------=-------___:__ ---=-----=-- ·- __·- --­ B=:J_ce after act1v1ty for this Due Peno~----=----- __-~ $ __ ----._-_ i _ 

Working Capital Reserve Target 	 J 

IUPB of the Assets as of the Determmation Date (last day of Due -- . ··-r­ . ]Period)__ ___ ___ ·-- ___ __ ._:_$_ - / 

~ w="~::,1"""'oo""T••• . . ·. ·. -1 ·-- 0~5%1~ 

!	

I Calculation of Working Capital Reserve Account Replenishment (Release) 

Working Capital Reserve Tar(lf'l___ __ __ ---· $ 1-

Working Capital Reserve Account Balance prior to replenishment 


(release)
 f-	 ,-- ··-- ·--- ·--· ·--.. ·-- ·-- ==~~===- -

I""'''"" ase) 	Wo~l"g Co""'' -~· Aoooom rnplo"Ohmool .. iI. $ _I -

f---(1) 	 [The Working Capital Reserve Account will be funded initially on tJCiosing ·Date by the Initial 

1Member and Private Owner based on their respective percentage LLC interests. I-- -- ---· ··--- ·-- ·-- --·· ---- '---· ----- ,­

-- ___ ___ .___ ---· ___ ___ .__I __ ____/ 

(2) 	 Working Capital Expenses means any Servicing Expenses, Interim Servicing Expenses, Pre-' 


Approved Charges, Required Funding Draws, Interim Servicing Fees, or fees of the 


Custodian and Paying Agent. 


f-- ---­
Exhibit B- SFR 2011-1 Venture Structured Transaction 

(3) I Working Capital Reserve Target means the targeted amount of the Working Capital Reserve 

Iequal to 0.25% of the Unpaid Principal Balance of the Assets as of each Determination Date. 
----

-----

---- ----- ----

Exhibit B- SFR 2011-1 Venture Structured Transaction 

~-~- _I ____j__

Excess Working Capital Advances 1­ J_-_·J~----t --­ Jvlonthly}lo/1 F_Orward _- ---- -:~==--=::-

[insert date} ·r-­

---1··- .... c:::= -·~ _- F I ___

~$1-­ --_-_-- I Baiance, b"lJinning of D~e Period .._____ 1---- ! .. -===

lActivity during Due Period 

-_(+) !'Adv_?_llces _!o Collec(icm A~countJe>r W_~_rking C~pital EXpenses r­ --~_r_ curr~!lt Due P~riod _____ _____ -,-­ ;-: -·~ ~-r preceding Due_ Peri_od ____ 

__t~~bursements fr~m C_ash Flow ____ 

I For preceding Due Period 

__

-~ailce, ,__ end of Due Peri~ 1$ 

~rT10 lterl:ls: Activitvf6~~ Due--p~-:- _____ ----- §'_----_. 

Paid or Received after Month-End. up_to Distribution Date 

(+) Advances_ to Collection_Account_forWJ?rking Capital :Expens~s 

i{:}~6imbursements from Cash Flow ;~.- ----- ---. ----- . -­ ! ---- ---- -- -- ,, 

' ____ 1 IBalance after activity for current Due Period ­ •... -- -­

,-- ---- ---­

___L_ ----- ---- . ---­

f_rivate Owner Pled_g_e_d_Acco-=u"-'n"-t_ 

Monthly Report__ ______ _____ 1

[insert dote] _____ 

i
iBalan~. b6_91nning o(Du~_-Period -=== 

(+) ProceedsffO~onletterofcredit ------ --- -- - ..----.-- --~--

(+) ~~~~~~ngCash Collateral deposit- ----- ---I -- -_-. __ ,--_ ~--_l --_·-____ ---_-_•• __ ---­

(+)!Investment Income -_ .. _ ---~. ..- :___ 


(-) [Payment of expense~ in connectiorl-with_Event 1 


-(-) ~~~~~=~~~f funds in excess of Private ~er Pledg8d AmOUilt -1-' I ­

pursuant to Sec 3.9(b) of the Custodial Agreement, payable to I 

the Private Owner ---- --~-- ---l

$ - . . --­ -----­ -

-­ -­ -----­ ---­ _,___ 

I - ---­

:Balance, end ~~eriod 

i ------ Required Funding Dra._.w~s--___ 

~thly Report ____ 

[insert date] ______ 

-! .. . .... .. .. :"=1 :Loan Number ·····­I Purpose of Required Funding Draw --~ - - ---- --­

f-----1 ---­

f---

I-­

I--­

-

$ - -F­ 1

! 

~- ... __L .. ----=r-_---+-


Amount of Current !_Unfunded Date oi'--,f---c(1) 

FUildT~g D~-- U~B _Commitment! _Draw IFunding Source 

$=--=------ _--__.- -==+- ---1 -_+= __-:__ -_­ ~=~~~,- =:f + I 

Totai'FUrldlf190ffiW_s, ITiOniTiSfid"ed [inS_ertdate] _! $ ___ _ - ! -----+ I _-_F

1 

(1) IIndicate funding by Asset Proce~ds, WCR, or Excess ~~cJoital Advances-====-1--l ::_______l =t= ---t--­
Exhibit B- SFR 2011-1 Venture Structured Transaction 

Pur~hase Money Note 	 t- ·-~1 Month/y_R_o_/1 Forw-a-rd-···==-··_ ---· ---_1_~, - I 

[insertdote] ---·· ----=- . 1-·-· ---r­

··l:~M:::OteMon-th_l_y_Rollfo..W-a-rd-- --- ___ -=±_!_·~----._ · .I ----:-___:___


;Pyrchase M<?neY Note balance, arter_paYmeilt for prE!vioUS Due Peri~ $ -- ___-_ -r-_ 


(-) Principal payments from current distributions 
 ···--· ·---· ·----- ------- ----- ··--. . ' 	 ---·· 

P~rchase Money N~te balanc~, a~~r pay111ent _!or current_Due P~ri~4~$~~=~~~==~ 

----tcalc~n of l_n-terest oueonPurchaSeiVIOnev NOTe__, ·---- --r- ----1 _- 1.~-urC.hase M.o._ne-y. No!e balai1ce ~n D..etefmination _Date -- -. _ ·. I $--- --- · - -rlnterest Rate I ~_,_2~'/oL_-_ 

~AccrualPeriod (ii days}, 30/360 basis ---=------· ._ .. C.. I 

. . llnte.res.t due o·n····· 	Pu.rchase.Mo.~ey ~ot~.. ·. ---· -­ ·-~~k =q= ­ -- CaiCiiliill.O-n otNotelSsua-ncefee ~-- ~rchase Money Note bali:mce_-on Determination Dfite 

iPurchase Money Note ISsuance Fee Rate ---· 

-~"-"" - ------:-_-­

!::::!:~:::-:- - ·----- --- --..·:l -

Isalar~Ce after repaYme~t fOr previo_us DUe Period -	 i $ -- _Payme_rlts_ b_y Guarantor, curren!_inonth __---- _;t___ ---· ·---­ __ Interest Du13, current m<?nth _______ _____ --- ---- ---~- --­

( __ Repayments from Cash Flow for this Due Perio_d_~- . · :,i -.. . . .. -­I ­

jB!Jiance !Jfter __activity__for ~his Ou~ PeriQ!!____ 	 .., 

~1_·--=---· -----=-_____:____- ··-- ·==-±.=·- - ­ (1) 	 The Note Issuance Fee will be paid-to theTransferor (FDIC as Receiver) on each Distribution Date _____l__l, . - --­

prior to the Guaranty Issuance Date, and to the Guarantor (FDIC Corporate) on each Distribution Date 

on or after the Guaranty Issuance Date. 1 
------- -

Exhibit B- SFR 2011-1 Venture Structured Transaction 

_ _L 

Additional Security Report 1-

[insert date] ___ _j_ 

Amount of Additional Security (in each case as of the end of the Due Period) 

· f~;,:~r""' ,.~, Q,,;,., : ... of"'~. · • 1. .· . . . ___ - __lBalance in P~ivate Owner Pledged Account___ ________ 

------1- Additional Security amount equal toor in excess of$ __ 

_ 

? 

I $

-t ____ -YES/NO 

_ 

_ 

- I'" "" ~"fOt '"'Additio"''"""'~ ~'''""" of'Q"'"''"' "''"'of ---- Credit, for each such Qualifying Letter of Credit __ __ _ ----­ __ 

,A Capital category of Issuing Bank as of the end of the Due Period 1 

'pursuant to the standards in 12 U.S. C.§ 1831o (b)(1), or applicable ]____ ___ 

replacement legislation: __ 

B. Is such Issuing Bank a Qualified Issuer? ] YES/NO 
____ 

__ __ __ 

Exhibit B- SFR 2011-1 Venture Structured Transaction 

~Active ~eport ±---~---!~-----~Lf------~---.-~--~~.----~_-_1----'l 11----11-_~~~-----·--+1'___,~~---~-- 1.,..·,··-----'~--- -.·.··- I __

1 r,:,::~~:,~tj~-c·"~o""'---lr-----j~----,~---It- -------1 ~ , -r--­

=r·-- 'l-~~-~~--------c~-+---=i--~~,-:--J-~~==~~--l =l . -j I -~ I ,r-_--··_~- -·~

1

Acq~~~ion New J'Origin•l ! Bo"ower I Property I I I ·_ A>•et Clo,ing Cumnt-· Lien App"i"'l A~::::,, I A~::::,, I Expe<ted I Net F•ir I 1# 

01 ~'"' ~~";-1--"D"'""'e-+A"'"''"et'-'-# Asset# Name name , Address City ST' Description SPE UPB UPB Position Method Date Value I selling Cost Value ListmgDate Mar~~!

' 1 I I 

l-c:-;+,1---~-~--~~~------~~'--'_=~~=:'-'~~~~~-'-::~----=j~~=--:=-=---=~: 1 =-~~~-~:~~=~=_:=~~~==+-t::l--~=:~f=--=--=-~-=-~~~~~:--i==-=-=~=-=-=".:r_:=-=--=-=~=-,~'.r-- ..-._-=-=-~~=-==_+-'=-l:-··-=-=-=-==~~==~-+--l==--=~=--=~~----·· __ ...=c_ ~ -- ---· __ l------_­__ s·-----,--,r ---_ ~- --~ =1··----~~

-·----'-----=:-=~-j--+-----'---'---,-------11--t-l---1-+----~----~-~- --1 I ---+== ~cc-~~=----=--L_____f----~~--~-++---1_.!.___,-----'.._ __J__--+--~-L___~-------+----R=----i -~ ~=~th7:;~:1~o~~~~~ ~=:~~rt 1 I -1 I I ···-+·-~-------t-----,-_ , ·-~--- [tn.ertDate] ·-·--1----- l ' · - I -ll----1----+- =~---=+== ----=., ---=r----=:=~-'--------,-----,-~--'=1===±-· 1

~---+---~~test . -1 - ·~ -~~ , Acquisition New Original Borrower Property Asset ; i A~~=~:al I A~praisal Expected ! Net Fair . ; on 

_":C,_:_:_:__"D"~~,e~--1--'-'"''"'"et,_#,___~.::"'::':•·~'"-"-'---'N-"'"m"'e'-t---""""'m=e-I-'A"d"d.,_.ress City ST Descrip~ion SPE Date Value 1'-Sel~ng Cost V•-lue Listing Date -~~~rket 

~ 1'-----~=-=-r----_·t-f--·--=--ll-=--==:+:::'==~===,-~~-~-1-'-_-----+_,-+--.~,=-~~=-:1=-_---_=-f'·~-· ~ .,. · ... ~ r -r-: . p···.. 

Page 14of48 
Exhibit B- SFR 2011-1 Venture Structured Transaction 

2 

3 

4 -·-·· 

-

- -" 

5 ' ' I I 

Page 15 of 48 
--

Exhibit B- SFR 2011-1 Venture Structured Transaction 

I I 

Amount 

i 

I t

-· J 

I ! 

I 

- ! 

i 

I 

----,-.----1~--------fl---e.----+-----+-1---+-. I I I ! -----,----,______________,____ --­

-·co-~-The Unpaid Principal Balance of any Loan or any portion of such--Loan constituting ·a Deficiency Bala~C-e s!]_?ll be deemed t~ be zero. · -----.~---~~---------~-----~~~===-------------~~~--! -lDeficiency balances will not be considered for purposes of calculating the Management Fee, Interim Management Fee, and Interim Servicing Fee. l­

~2f 1 Brief comment desCribing nature of new ~eficiencies, or ~-on-cash resolu~ion ~f outstan~inQ deficiency~ . , ....__! ·---- ....'"'-::_::_::_::_::_::_::__f------=====------____ 
Exhibit B- SFR 2011-1 Venture Structured Transaction 

Summary of Modifications, Short Refis, Short Sales 

Inception-to Date (LLC Closing Date} through [insert date] 

Inception-to-Date, from closing date of LLC 

UPB at resolution date 

Net proceeds (1) 

Principal forgiveness 

Principal forbearance 

Forgiveness as % of UPB 

Forbearance as% of UPB 

Total Forgiveness and Forbearance 

Plans/Reinstatements Short Refis Short Sales/Short Payoffs Total 

!£ ~ !£ ~ !£ ~ !£ ~ 

0 

0 

0 

0 

$ -

$ -

$ -

$ -

0 $ 

0 $ 

0 $ 

0 $ 

-

-

-

-

0 $ - 0 $ -

0 $ -

0 $ -

0 

0 

0 

0 

$ 

$ 

$ 

$ 

-

-

-

-

#DIV/0! 

#DIV/0! 

#DIV/0! 

#DIV/0! 

#DIV/0! 

#DIV/0! 

#DIV/0! 

#DIV/0! 

#DIV/0! 

(1) For Modifications, provide the amount of the interest-bearing loan after modification. 

For Short Refis and Short Sales, provide net proceeds to investor. 
Exhibit 8 - SFR 2011-1 Venture Structured Transaction 

Other Reports 

Withdrawals from Collection Account 

Manager hereby certifies that all withdrawals by the Manager from the Collection Account during 

the relevant Due Period were made in accordance with the terms ofthe LLC Operating Agreement 

and the Custodial Agreement: Y IN 

Delinquency Report 

# and $ by delinquency classification: Current, 30-59 days, 60-89 days, 90+ days, in foreclosure, in 


bankruptcy, REO 


Breakout of> 60 day delinquencies by collateral type, # and $ 


Breakout of> 60 day delinquencies by state,# and $ 


Modification Report 

Listing of loans modified, to include borrower name, loan balance and terms before modification, 

loan balance and terms after modification. Show amounts of principal forgiven, if any, and principal 

forbearance amounts, if any. 

Loan Liquidation Report 

Listing ofloans sold, to include borrower name, UPB, net liquidation proceeds, cumulative Servicing 

Expenses, realized loss amount, Company lien position, amount of lien( s) with priority position over 

Company lien, appraisal amount, appraisal date, type of appraisal. 

Short Sale Report 

Listing of loans for which short sales were accepted, to include borrower name, UPB, payoff 

accepted, realized loss amount, Company lien position, amount oflien(s) with priority position over 

Company lien, appraisal amount, appraisal date, type of appraisal. 

Judgment Report 

Listing of Judgments obtained, to include borrower name, Judgment amount, cunent month and 

cumulative payments received, remaining balance 
Exhibit B- SFR 2011-1 Venture Structured Transaction 

Significant Litigation Report 

Provide a litigation summary report describing any claim or counterclaim ("claim") filed against the 

Company and/or Servicer with respect to assets subject to this Agreement, the actions taken to 

defend such claim, and an estimate ofthe projected exposure for: a) any claim in which the Company 

or Servicer expects to incur more than $10,000 in Servicing Expenses to defend such claim, b) any 

claim in which multiple plaintiffs have joined in filing an action against the Company and/or 

Servicer or the same law firm has filed individual claims on behalf ofmore than one plaintiff, and c) 

any claim(s) regardless of the dollar amount naming: (i) a Failed Bank, or (ii) FDIC (in any capacity) 

as defendant(s). Activity should be updated quarterly. 

Environmental Exposure Report 

Provide a report identifYing any assets in which the Site Assessment identified an Environmental 

Hazard together with information on the nature of the hazard, additional tests performed, and the cost 

of correcting the hazard identified in the Site Assessment. 

Bank Statements 

For accounts held at the Custodian, provide bank statements showing activity and ending balance for 

the current Due Period, and related bank account reconciliations. 

MONTHLY LOAN-LEVEL DETAIL REPORTS 

Monthly Loan Trial Balance andActivity Report 

PROVIDE A MONTHLY ASSET-LEVEL REPORT 

IN EXCEL WITH THE FOLLOWING FIELDS: 

Current Loan Number 

Prior Servicer Loan Number 

FIN (receivership) Number 

Borrower/ Asset Name 

P&I Constant 

Note Rate 

Next Due Date 

Payoff Date (if applicable) 

Loan Unpaid Principal Balance, end of prior month 

Principal collections -regular and curtailments 

Principal collections - paid in full 

Principal proceeds - loan sales, including short sales 

Mortgage Insurance collections 

Principal Commitments Funded 

Principal Write-Off Amount 

Other Non-Cash Principal Adjustment (modifications capitalized, other) 
Exhibit B - SFR 2011-1 Venture Structured Transaction 

Transfer to REO 

oan Unpaid Principal Balance, end of curren month 

REO Net fair Val e, end of prior month 

Transfer to REO 

Adjustments to 1'\et Fair Value 

Capitalized post-acquisition costs 

Net liquidation proceeds 

Realized gain/(toss) 

REO Net Fair Value, end of cunent month 

Escrow (Tax and Insurance) Advance bal::· ce, end ofprior month 

Escrow Advances paid 

Recoveries of Escrow Advances 

Other Adjustments to Escrow Advance balances 

Escrow (Tax and Insurance) Advance balance, end of cunent month 

Corporate Advance balance, end of prior month 

Corporate Advances paid 

Recoveries ofCorporate Advances 

Other Adjustments to Corporate Advance balances 

Corporate Advance balance, end of current month 

Non-Recoverable Servicing Expenses paid (listing of amounts paid - not allocated at asset leve:) 

Interest collections 

Ancillary Fee collections 

Other Fees paid 

Other Fee Incot e collections 

Unapplied (suspense) funds 

$erl'icing Svstem Data Download- To Initial JV!ember 

Provide a monthly loan-level data download using the LLC data specification and template pu lished 

by the FDlC for LLC reporting. This specification and template may be modified from time to time 

by the Initial Member. 

The LLC data specification and template may be accessed at the following link: 

http://www.fdic. gov /bank/ind ividua 1/failedllossshare/structu red transaction DataSpees.htmI 

SE.WIANNUAL REPORT- TO INITIAL IV!EMBER (due not later than January 31st and July 

31st ofeach year, commencing January 31, 2012 

Business Plan 

Updated Consolidated Business Plan and individual Asset Level Business Plans for 25 largest Assets 

as required pursuant to Section 7.7 ofthe LLC Operating Agreement. 
Exhibit B- SFR 2011-1 Venture Structured Transaction 

Projected Cash Flows 

Excel model of projected cash flows by month, as of June 30 and December 31 of each year, as 

required pursuant to Section 7.7(c) ofthe Company Operating Agreement, in a format substantially 

consistent with the Cashflow and Distribution Report included in this Monthly Report. The 

projection should carry through to the termination date ofthe Company, providing monthly 

projections for the first 24 months and quarterly projections thereafter. The projection should 

included projected cash inflows, outflows, net distributable funds to the equity holders, aggregate 

Unpaid Principal Balance of the assets, and significant assumptions used to prepare the projection. 

ASAVAILABLE- TO INITIAL MEMBER 

Custodial Report or an updated Asset Schedule and Exception List (as defined in the Custodial 

Agreement) from the Custodian/Paying Agent, as provided to the Company. 
EXHIBITC 

FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT 

THIS ASSIGNMENT AND ASSUMPTION AGREEMENT (this "Agreement") is made and 

entered into as of , 20_ by and between MountainView Public Private 

Investment I, LLC, a Delaware limited liability company ("Transferor"), and 

__________., a ("Transferee"). 

RECITALS 

WHEREAS, the Transferor is the owner of a limited liability company interest in SFR 

Venture 2011-1, LLC, a Delaware limited liability company (the "Company"); 

WHEREAS, such limited liability company interest represents a _% "Percentage 

Interest" in the Company (as defined in that certain Amended and Restated Limited Liability 

Company Operating Agreement, effective as of September 1, 2011, by and among the Federal 

Deposit Insurance Corporation in its capacity as Receiver (as such term is defined in the 

Agreement of Definitions referred to therein) (the "Initial Member"), Transferor and the 

Company (the "LLC Operating Agreement")); 

WHEREAS, the ownership and other rights associated with such limited liability 

company interest are set forth in the LLC Operating Agreement; 

WHEREAS, pursuant to Section 3.13 of the LLC Operating Agreement, Transferor 

granted the Initial Member a first priority security interest in the Private Owner Interest (as such 

term is defined in the LLC Operating Agreement) in order to secure certain obligations of 

Transferor as more fully described in the LLC Operating Agreement; 

WHEREAS, an Event of Default (as defined in the LLC Operating Agreement) has 

occurred and is continuing, and the Initial Member has elected, pursuant to the LLC Operating 

Agreement, to foreclose on its security interest in the Private Owner Interest and effect the 

assignment contemplated hereby; 

NOW THEREFORE, in consideration of the mutual agreements contained herein and in 

the LLC Operating Agreement, and for other good and valuable consideration, the receipt and 

sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the 

parties hereto agree as follows: 

1. Assignment and Assumption. Transferor hereby assigns and transfers the 

Private Owner Interest to Transferee, and Transferee hereby accepts and assumes the Private 

Owner Interest and agrees to be bound by the LLC Operating Agreement and the other 

Transaction Documents to which the Private Owner is a party, as amended from time to time, to 

the extent it relates to such Private Owner Interest. 

C-1 

SFR 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
2. Counterparts. This Agreement may be executed in two or more counterparts, all 

of which shall be considered one and the same agreement and shall become effective when one 

or more counterparts have been signed by each ofthe parties and delivered (including by 

telecopy) to the other party. 

3. No Third Party Beneficiaries. This Agreement shall inure to the benefit of the 

parties hereto and their respective successors and permitted assigns. This Agreement is not 

intended to confer upon any other person any rights or remedies hereunder. 

4. Governing Law. The Laws of the State of Delaware will govern the validity, 

performance and enforcement ofthis Agreement, without giving effect to the principles of 

conflict of Laws of the State of Delaware or any other jurisdiction. 

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement 

effective as ofthe date first above written. 

TRANSFEROR: 

MOUNTAINVIEW PUBLIC PRIVATE 

INVESTMENT I, LLC 

By: _________________________ 

Name: Michael P. Morgan 

Title: CEO and President 

TRANSFEREE: 

By: ___________________________ 

Name: _____________________________ 

Title: __________________________ 

C-2 


SFR Venture 2011-l Structured Transaction 

Amended and Restated LLC Operating Agreement 
EXHIBITD 


FORM OF LETTER OF CREDIT 


(Bank Letterhead Stationary) 

Federal Deposit Insurance Corporation, in its capacity as Initial Member (as defined below) 

Manager, Capital Markets & Resolutions 

c/o Federal Deposit Insurance Corporation 

550 171

h Street, NW (Room F-7015) 

Washington, D.C. 20429-0002 

Attention: Ralph Malarni 

E-mail Address: RMalami@fdic.gov 

Tel: (202) 898-3713 

Fax: (202) 898-8637 

RE: Irrevocable Transferable Letter of Credit No. _____ for 

U.S.$ , Dated ________ 

Gentlemen: 

We hereby issue our irrevocable transferable Letter of Credit No. 

(this "Letter of Credit") in favor of Federal Deposit Insurance Corporation (in any capacity, 

including as receiver for the failed financial institutions referenced in or pursuant to the LLC 

Agreement defined below, in its corporate capacity or otherwise, the "FDIC"), as the Initial 

Member under the LLC Operating Agreement defined below (including its successors, and its 

assigns as provided herein, the "Initial Member") (such Initial Member being the beneficiary of 

this Letter of Credit), for the account of Mountain View Public Private Investment I, LLC (the 

"Private Owner"). 

We understand that this Letter of Credit is issued pursuant to the Amended and Restated 

Limited Liability Company Operating Agreement dated as of September 1, 2011 (as amended or 

otherwise modified from time to time, the "LLC Operating Agreement"), by and among SFR 

Venture 2011-1, LLC (the "Company"), the Private Owner and the Initial Member. 

We undertake to honor from time to time your draft or drafts presented to us in 

accordance herewith not exceeding in the aggregate [ U.S. Dollars (U.S.$ 

c_---c:---:-:----::--'). All drafts hereunder (i) must be marked "Drawn under irrevocable 

transferable Letter of Credit No. , dated ", (ii) must be 

accompanied by a typewritten statement signed by a purportedly authorized representative of the 

Initial Member stating that an "Event of Default" or "LC Reissuance/Extension Failure" has 

occurred under (and as defined in) the LLC Operating Agreement (a "Drawing Request"), and 

D-1 

SfR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
(iii) shall, unless payment is to be made at sight, include the wire transfer instructions for 

remittance by us of the amount of such draft. 

Presentation of drafts drawn hereunder, together with the required statement and 

applicable wire transfer instructions, may be made at any time on or before the expiry date 

hereof (i) by physical presentation of such draft at, or overnight delivery of such draft to, our 

offices located at [include address in either New York City 

or Washington, D.C.], provided that any such documents presented on the Expiration Date (as 

defined below) must be received on or prior to 5:00P.M. (New York, New York time). If we 

receive such documents at such office, all in conformity with the terms and conditions of this 

Letter of Credit, we will honor your draft on the second Business Day (as defined below) after 

receipt of such Drawing Request. The original Letter of Credit, any amendments thereto and the 

originally signed Drawing Request on the Initial Member's letterhead must be included in the 

documents presented hereunder in connection with any draft, it being agreed that such original 

Letter of Credit and all such amendments thereto so presented shall be promptly returned to you 

(or, if presented in person, shall remain with you after we have made a copy thereof at such time 

of presentation) in connection with any partial draw hereunder. 

This Letter of Credit shall expire at 5:00 p.m. (New York, New York time) on the date 

that occurs one year after the date hereof (or, if such date is not a Business Day, the immediately 

succeeding Business Day) (the "Expiration Date"); provided, however, that this Letter of Credit 

will be automatically extended without amendment for additional periods of one year each (in 

each case commencing from the expiry date hereof as then in effect), unless we elect not to 

extend this Letter of Credit and deliver to the Initial Member written notice of such election at 

least sixty days prior to any such Expiration Date. Any such notice shall be in writing and shall 

be delivered in hand with receipt acknowledged, or by certified mail (return receipt requested), to 

the Initial Member at its address set forth above (or to such other address for any such notices 

which Initial Member may hereafter specify in a written notice delivered to the undersigned). 

"Business Day" means any date other than a Saturday, Sunday or a day on which banks in the 

[State of New York] [District of Columbia] 1 are authorized or required by Law to be closed, and 

a day on which payments can be effected on the Fed wire system (or any replacement thereto). 

Partial and multiple drafts are permitted, and the amount of this Letter of Credit will be 

reduced by each such draft honored. 

All our charges (including wire transfer fees in connection with any payments by us 

hereunder and transfer charges in connection with a transfer of this Letter of Credit by the FDIC 

(in any capacity), as Initial Member, to a transferee thereof) are for the account of the Private 

Owner, and in no event shall any such charges reduce the amount of any draft or payment 

hereunder; provided, however, transfer charges in connection with a transfer of this Letter of 

Credit by any Initial Member other than the FDIC (in any capacity) to a transferee thereof shall 

be for the account of such Initial Member and/or transferee. 

1. Select based on location of presentation 

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SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
We agree that we shall have no duty or right to inquire as to the basis upon which Initial 

Member has determined to present to us any draft under this Letter of Credit. 

This Letter of Credit is transferable in whole but not in part to any transferee who has 

succeeded you as the Initial Member under the LLC Operating Agreement, and may be 

successively transferred. Any transfer request must be effected by presenting to us the attached 

form of Attachment I signed by the transferor and the transferee together with the original Letter 

of Credit. Upon our endorsement of such transfer, the transferee instead of the transferor shall, 

without necessity of further action, be entitled to all the benefits of and rights under this Letter of 

Credit in the transferor's place, provided that, in such case, any drafts of the Initial Member to be 

provided hereunder shall be signed by one who states therein that he is a duly authorized officer 

or agent of the transferee. For purposes of clarification, internal transfers within the FDIC 

(where following such transfer, the FDIC, in any capacity is to remain as the beneficiary of the 

Letter of Credit) shall be effective without the need for notice or execution and delivery of any 

such request for transfer in the form of Attachment I hereto. 

Except as otherwise expressly stated herein, this Letter of Credit is subject to the 

International Standby Practices, International Chamber of Commerce Publication No. 590, 

including any amendments, modifications or revisions thereof (the "ISP 98"). As to matters not 

covered by the ISP 98, and to the extent not inconsistent with the ISP 98, this Letter of Credit 

shall be governed by and construed in accordance with the Laws of the State of New York, 

including without limitation the Uniform Commercial Code as in effect in the State of New 

York, without regard to principles of conflict of Laws. 

All of the terms and conditions of this Letter of Credit are contained herein and shall not 

be altered except by reduction in the amount of this Letter of Credit due to corresponding 

payments in like amount in compliance with the aforementioned terms. Except as otherwise 

expressly set forth herein, there are no conditions to this Letter of Credit. 

Very truly yours, 

By: 

Name: Title: ----------­

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SFR Venture 2011-1 Structured Transaction 

Amended and Restated LLC Operating Agreement 
ATTACHMENT I TO LETTER OF CREDIT 

REQUEST FOR TRANSFER 

[Insert Bank Name and Address] 

RE: Irrevocable Transferable Letter of Credit No. '-------' for 

U.S.$ , Dated L__________, 

Gentlemen: 

Reference IS made to that certain irrevocable transferable Letter of Credit No. 

':--------:::--:-:---:='' dated (the "Letter of Credit"), issued by you in favor of 

[ (the "Transferor"), for the account of Mountain View Public Private Investment I, 

LLC, a Delaware limited liability company (the "Private Owner"). 

The Transferor has transferred and assigned (and hereby confirms to you said transfer and 

assigmnent) all of its rights in and under the Letter of Credit to [name of Transferee] (the 

"Transferee") and confirms that the Transferor no longer has any rights under or interest in the 

Letter of Credit. 

The Letter of Credit is returned herewith and we request that you issue an irrevocable 

transferable letter of credit in the name of the Transferee and providing for notices to be sent to 

the Transferee at the address set forth below and in all other respects identical to the Letter of 

Credit. 

Transferee hereby certifies that it is a duly authorized transferee under the terms of the Letter of 

Credit and is accordingly entitled, upon presentation of the drafts (and applicable items) called 

for therein, to receive payment thereunder. 

Notices under the Letter of Credit should be sent to the Transferee as follows: [Name], 

[Address], [Attention: , E-mail Address: [ , Fax: [ , Tel: [ ____, 

[NAME OF TRANSFEROR] 

By____~~--~~~--- [Name and Title of Authorized 


Representative of Transferor] 

[NAME OF TRANSFEREE] 

By______________~---

[Name and Title of Authorized 

Representative of Transferee] 

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SFR Venture 2011-l Structured Transaction 

Amended and Restated LLC Operating Agreement