SERVICING AGREEMENT 


by and between 


FNBN-CMLCON I LLC 


and 


PRIMARY RESIDENTIAL MORTGAGE, INC. 


Dated as of February 20, 2009 


FNB COMMCONSTR SERV A G. DOC EXECUTION VERSION 

12349237.5 
TABLE OF CONTENTS 


ARTICLE I DEFINITIONS AND CONSTRUCTION .................................................................. 1 


Section 1.01 Definitions................................................................................................... 1 


ARTICLE II SERVICING OBLIGATIONS OF THE SERVICER ............................................. 10 


Section 2.01 
 Appointment and Acceptance as Servicer ................................................ 10 


....................................................................... 10 


............................................................................................ 10 


.................................................................................... 11 


................................................................................... 11 


............................................................................................. 12 


...................................................................................... 13 


......................................................................................... 13 


Section 2.02 
 Limited Power of Attorney 

Section 2.03 
 Servicing Fee 

Section 2.04 
 Servicing Standard 

Section 2.05 
 Collection Account 

Section 2.06 
 LIP Account. 

Section 2.07 
 Escrow Accounts 

Section 2.08 
 Other Accounts 

Section 2.09 


Section 2.10 
 Expenses ................................................................................................... 14 


Section 2.11 
 Insured or Guaranteed Loans .................................................................... 14


Maintenance oflnsurance Policies; Errors and Omissions and Fidelity 


Coverage ................................................................................................... 13 


ARTICLE III LOAN DEFAULTS; ACQUISITION OF COLLATERAL .................................. l4 


Section 3.01 Delinquency Control ................................................................................. 14 


Section 3.02 Discretion of the Company in Responding to Defaults ofBorrower. ....... 14 


Section 3.03 Acquisition of Acquired Collateral.. ......................................................... 15 


ARTICLE IV SUBSERVICING .................................................................................................. 15 


Section 4.01 
 Retention of Subservicer........................................................................... 15 


.................................................... 15 


............................................................... 17 


................................................................... 17 


................................................................... 17 


Section 4.02 
 Subservicing Agreement Requirements 

Section 4.03 
 Servicer Liable for Subservicers 

Section 4.04 
 Company Approval Required 

Section 4.05 
 Regulation AB Requirements 

ARTICLE V REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE 


SERVICER ................................................................................................................................... 18 


Section 5.01 
 Representations and Warranties ................................................................ 18 


.................... 19 


........................................................................................................ 20 


.................................................................................................... 21 


.......................... 21 


....................................................................................... 21 


Section 5.02 
 Reporting, Books and Records and Compliance Covenants 

Section 5.03 
 Audits 

Section 5.04 
 No Liens 

Section 5.05 
 Servicer's Duty to Advise; Delivery ofCertain Notices 

Section 5.06 
 Notice of Breach 

ARTICLE VI PARTICIPANT CONSENT .................................................................................. 21 


Section 6.01 Actions Requiring Participant Consent. .................................................... 21 


Section 6.02 Amendments, Modification and Waivers ................................................. 22 


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ARTICLE VII DEFAULTS; TERMINATION; TERMINATION WITHOUT CAUSE ............ 22 


Section 7.01 Defaults ..................................................................................................... 22 


Section 7.02 Termination with Cause ............................................................................ 24 


Section 7.03 Termination without Cause ....................................................................... 24 


Section 7.04 Effective Date ........................................................................................... 25 


Section 7.05 Accounting ................................................................................................ 25 


ARTICLE VIII INDEPENDENCE OF PARTIES; INDEMNIFICATION ................................. 25 


Section 8.01 Independence of Parties ............................................................................ 25 


Section 8.02 Indemnification ......................................................................................... 26 


Seetion 8.03 Procedure for Indemnification .................................................................. 26 


ARTICLE IX NOTICES ............................................................................................................... 27 


ARTICLE X GOVERNING LAW; JURISDICTION .................................................................. 28 


Section 10.01 Governing Law ......................................................................................... 28 


Section 10.02 Jurisdiction; Venue and Service ................................................................ 28 


Section 10.03 Waiver ofJury Trial.. ................................................................................ 29 


ARTICLE XI MISCELLANEOUS .............................................................................................. 29 


Section 11.01 No Assigmnent by Servicer; No Transfer ofOwnership Interests in 


Servicing Rights ........................................................................................ 29 


Section 11.02 Legal Fees ................................................................................................. 29 


Section 11.03 Entire Agreement.. .................................................................................... 29 


Section 11.04 Counterparts; Facsimile Signatures .......................................................... 29 


Section 11.05 Headings ................................................................................................... 30 


Section 11.06 Construction .............................................................................................. 30 


Section 11.07 Compliance with Law ............................................................................... 31 


Section 11.08 Severability ............................................................................................... 31 


Section 11.09 Third Party Beneficiary ............................................................................. 31 


Section 11.10 Protection of Confidential Information ..................................................... 31 


Section 11.11 Time of Essence ........................................................................................ 31 


Section 11.12 No Presumption ........................................................................................ 32 


Section 11.13 No Right of Setoff..................................................................................... 32 


Section 11.14 Release of Participant and Prior Servicers ................................................ 32 


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Exhibits 

Exhibit A 

Schedules 

Schedule I 

Schedule 2 

Schedule 3 

Schedule 4 

Schedule 5 

SCHEDULES AND EXHIBITS 


Loan Schedule 

Fee Schedule 

Servicing Obligations 

Reimbursement of Servicer Advances 

Form of Electronic Report on the Loans and Collateral 

Termination Without Cause 

FNB COMMCONSTR SERV AG.DOC EXECUTION VERSION 

12349237.5 
SERVICING AGREEMENT 


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

"Agreement") is made and entered into as ofthe 20'h day ofFebruary, 2009 (the "Effective 

Date"), by and between FNBN-CMLCON I LLC, a Delaware limited liability company 

(including its successors and assigns, the "Company"), and Primary Residential Mortgage, Inc., 

a Nevada corporation (including those ofits successors and assigns as are expressly permitted 

pursuant to this Agreement, the "Servicer"). 

RECITALS 

WHEREAS, the Company owns the Loans (as defined below) described on the Loan 


Schedule attached hereto as Exhibit A (the "Loan Schedule"); and 


WHEREAS, the Company is obligated to service and manage the Loans and related 

Collateral (as defined below) pursuant to that certain Participation and Servicing Agreement (the 

"Participation Agreement") dated as ofthe 20'h day ofFebruary, 2009, by and between the 

Company and the Federal Deposit Insurance Corporation ("FDIC"), as receiver ("Receiver") for 

First National Bank ofNevada, including its successors and assigns, (the "Participant"); and 

WHEREAS, the Company and the Servicer desire that the Servicer service and 

administer the Loans and Collateral on behalf of the Company in a manner that is, at all times, 

consistent with the requirements ofthis Agreement; 

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

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

sufficiency ofwhich are hereby acknowledged, the Company and the Servicer hereby agree as 

follows: 

ARTICLE I 


DEFINITIONS AND CONSTRUCTION 


Section 1.01 Definitions. For purposes ofthis Agreement, the following terms shall 

have the meanings and definitions hereinafter respectively set forth. 

"Acceptable Rating" shall mean any of the top three rating categories that may be 

assigned to any security, obligation or entity by the Rating Agencies. 

"Acquired Collateral" shall mean property to which title is acquired by foreclosure, by 

deed in lieu of foreclosure, by power of sale or by sale pursuant to the Uniform Commercial 

Code, in any such case in accordance with the Loan Documents and this Agreement. 

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

or indirectly controlling or controlled by or under common control with such specified Person, 

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

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

director, partner, member, trustee, employee or promoter of the Person specified or any 

Immediate Family Member ofsuch officer, director, partner, member, trustee, employee or 

FDIC FNBN CM LCON Servicing Agreement- EXECUTION VERSION 

12349237.5 
promoter, (iv) any corporation, partnership, limited liability company or trust for which any 

Person referred to in clause (ii) or (iii) acts in that capacity, or (v) any Person who is an officer, 

director, general partner, managing member, trustee or holder of I 0% or more ofthe outstanding 

voting securities, voting equity interests or beneficial interests of any Person described in clauses 

(i) through (iv); provided, however, that, for purposes ofthis Agreement, the Participant shall not 

be deemed to be an Affiliate ofthe Company or of any Affiliate ofthe Company. For the 

purposes ofthis definition, the term "control" (including the phrases "controlled by" and 

"under common control with") when used with respect to any specified Person means the 

possession, direct or indirect, ofthe power to direct or cause the direction ofthe management and 

policies ofsuch Person, whether through the ownership of voting securities or interests, by 

contract or otherwise. 

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

"Authorized Funding Draw" shall mean any principal advance with respect to a Loan 

listed, up to the maximum aggregate amount of principal advances set forth in the column of the 

Loan Schedule entitled "Maximum Authorized Funding Draw", including any such advances 

made by Participant prior to the Servicing Transfer Date; provided, however, that (i) ifrequired 

by applicable Law or if otherwise deemed necessary by the Company, an endorsement to the title 

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

Company, is obtained that (a) brings down the effective date ofthe title policy to the date on 

which the applicable Authorized Funding Draw it covers is made, (b) increases the liability limit 

ofthe title policy by an amount equal to the principal amount ofsuch Authorized Funding Draw, 

and (c) contains no new exceptions to title; (ii) notwithstanding anything to the contrary 

contained in this Agreement, the Servicer shall make or permit an Authorized Funding Draw if 

then outstanding unpaid principal balance ofthe Loan exceeds the value ofthe Collateral only if 

the Company determines, in its reasonable judgment, that the Borrower is reasonably likely to be 

able to repay the Loan or that the making ofthe Authorized Funding Draw is in the best interests 

(in terms ofmaximizing the value ofthe Loan) ofthe Company and the Participant; and (iii) 

such advance is made in accordance with the terms ofthe Loan and the Loan Documents, 

provided however, that if any term with respect to the Loan or the Loan Documents precludes 

such advance in the event of a Borrower default, such term may be waived ifthe Company 

determines, in its reasonable judgment, that such waiver is in the best interests of the Company 

and the Participant in terms ofmaximizing the value ofthe Loan. 

"Borrower" shall mean the borrower or other obligor with respect to a Loan. 

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

commercial banks in Washington, D.C. or United States federal government offices are required 

or authorized by Law to close. 

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

intangible, securing or pledged to secure a Loan, including any account, equipment, guarantee or 

contract right, or other interest that is the subject of any Collateral Document, and as the context 

requires, includes Acquired Collateral. 

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

or corporate guaranty, deed of trust, mortgage, contract for the sale of real property, assignment, 

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

whether similar to or different from those enumerated, securing in any manner the performance 

or payment by any Borrower ofits obligations or the obligations of any other Borrower under 

any ofthe Loans or Notes evidencing the Loans. 

"Collection Account" shall have the meaning given in Section 2.05. 

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

"Cut-Off Date" shall mean December 31, 2008. 

"Default" shall have the meaning given in Section 7.01. 

"Eligible Account" shall mean a segregated trust or custodial account or accounts 

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

benefit of the Company and the Participant as required by Article II. 

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

"Eligible Institution" shall mean a Person that is not an Affiliate ofthe Company and 

that is a federally insured depository institution that is well capitalized; provided that an Affiliate 

of the Company may be deemed to be an Eligible Institution if the Participant provides a written 

consent (which may be withheld in the Participant's sole and absolute discretion), which consent 

may be withdrawn by the Participant upon written notification to the Company, in which case 

such Affiliate ofthe Company shall no longer constitute an Eligible Institution as of the receipt 

of such notice and any accounts maintained pursuant to this Agreement at such institution shall 

be moved to an Eligible Institution within three (3) Business Days after the receipt of such 

notice. 

"Environmental Hazard" shall mean the presence at, in or under any real property 

constituting part of the Collateral (whether held in fee simple estate or subject to a ground lease, 

or otherwise, and including any improvements whether by buildings or facilities, and any 

personal property, fixtures, leases and other property or rights pertaining thereto) of any 

"hazardous substance," as defined in Section I 0 I ( 14) ofthe Comprehensive Environmental 

Response, Compensation and Liability Act of 1980,42 U.S.C. §9601(14), or any petroleum 

(including crude oil or any fraction thereof that is liquid at standard conditions oftemperature 

and pressure), at a level or in an amount that requires remediation or abatement under applicable 

environmental Law. 

"Escrow Accounts" shall have the meaning given in Section 2.07. 

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

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

using funds in the Borrower's Escrow Account. 

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

(i) are not incurred in accordance with the Servicing Standard or the 

Fannie Mae Guidelines; 

(ii) are paid to any Affiliate ofthe Company, or any Affiliate of the 

Servicer or any Subservicer; 

(iii) any incurred by the Servicer or any other Person to become a 

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

standing; 

(iv) incurred to pay compensation to or expenses offinancial advisers, 

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

incurred to market or sell the Loans or any Acquired Collateral in a bulk sale the terms of 

which bulk sale (including the financial adviser's or broker's fees or sales commissions) 

are approved in advance by the Company; 

(v) incurred to pay any fine, tax or other penalty, late fee, service 

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

(including legal fees and expenses) incurred by or on behalf ofthe Servicer or any 

Subservicer as a result ofthe Servicer's or any Subservicer's failure to service any Loan 

or Collateral properly in accordance with the applicable Loan Documents, this 

Agreement, any Subservicing Agreement or otherwise, or failure to make a payment in a 

timely manner, or failure otherwise to act in a timely manner; 

(vi) incurred to pay any interest on any Servicing Advances or any 

advances made by any Subservicer; 

(vii) constitute or are incurred to pay any overhead or administrative 

costs incurred by the Servicer or any other Person (including any expenses incurred to 

comply with Section 5.02); or 

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

any Subservicer or any other Person. 

"Failed Bank" shall mean First National Bank of Nevada. 

"Fannie Mae" shall mean the Federal National Mortgage Association ofthe United 

States or any successor thereto. 

"Fannie Mae Guidelines" shall mean those guidelines governing reimbursement of costs 

and expenses by Fannie Mae with respect to loans owned or securitized by Fannie Mae, as in 

effect on the date on which an expense or cost is incurred. 

"Fee Schedule" shall mean Schedule 1, as the same may be amended from time to time 

by the Company and the Servicer without the consent ofthe Participant. 

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"FDIC" shall mean the Federal Deposit Insurance Corporation, in any capacity, or any 

successor thereto. 

"Governmental Authority" shall mean any United States or non-United States national, 

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

subdivision of any governmental, regulatory or administrative authority, agency or commission, 

or judicial or arbitral body. 

"Guarantor" shall mean any guarantor of all or any portion of any Loan or all or any of 

any Borrower's obligations set forth and described in the Loan Documents. 

"Guidelines" shall have the meaning given in Section 2.04. 

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

spouse, parents, parents-in-Jaw, grandparents, descendants, nephews, nieces, brothers, sisters, 

brothers-in-law, sisters-in-law, children (whether natural or adopted), children-in-law, step 

children, grandchildren and grandchildren-in-law. 

"Indemnified Parties" shall have the meaning given in Section 8.02. 

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

any ofthe following events: 

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

Proceeding; 

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

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

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

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

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

similar relief under any Law; 

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

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

specified Person's properties; 

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

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

proceeding described in clauses (1) through (5); 

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

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

fair valuation; or 

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FDJC FNBN CMLCON Servicing Agreement-EXECUTION VERSJON 

12349237.5 
(8) within ninety (90) days of any proceeding against the specified Person 

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

similar relief under any Law if the proceeding has not been dismissed, or within ninety (90) days 

after the appointment of a trustee, receiver or liquidator for the specified Person or all or any 

substantial part of the specified Person's properties without the specified Person's agreement or 

acquiescence, which appointment is not vacated or stayed, or if the appointment is stayed, for 

ninety (90) days after the expiration of the stay if the appointment is not vacated. 

"Insolvency Proceeding" shall mean any proceeding under Title 11 of the United States 

Code (11 U.S.C. §§I 01, et seq.) or any proceeding under the Law of any jurisdiction involving 

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

relief. 

"Interest Rate" shall mean the rate at which the outstanding principal balance of a Loan 

bears interest, as more particularly set forth in a Note, including, without limitation, the rate of 

any default interest, if applicable. 

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

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

Authority. 

"Lien" shall mean any pledge, security interest, charge, restriction on or condition to 

transfer, voting or exercise or enjoyment of any right or beneficial interest, option, right offirst 

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

"LIP Account" shall mean an Eligible Account established and maintained with an 

Eligible Institution for the sole purpose of holding and distributing the LIP Funds. 

"LIP Funds" shall have the meaning given in Section 2.06(a). 

"Loan" shall mean any loan or Loan Participation listed on the Loan Schedule and any 

loan into which any such listed loan or Loan Participation is refinanced, and includes with 

respect to each such loan or Loan Participation: (i) any obligation evidenced by a Note; (ii) all 

rights, powers or Liens ofthe Company in or under the Collateral Documents; (iii) any contract 

for deed or installment land contract and the real property which is subject to any such contract 

for deed or installment land contract; and (iv) any lease and the related leased property. 

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

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

caused to be delivered by any Borrower, any Guarantor or any other obligor evidencing, 

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

part of a Loan or any Acquired Collateral or evidencing any transaction contemplated thereby, 

and all Modifications thereto. 

"Loan Participation" shall mean any asset subject to a shared credit, participation or 

similar inter-creditor agreement under which the Failed Bank or the Receiver was the lead or 

agent financial depository institution or otherwise managed or held the credit or sold 

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FDIC FNBN CMLCON Servicing Agreement~EXECUTION VERSION 

12349237.5 
participations, or under which the Failed Bank or the Receiver was a participating financial 

depository institution or purchased participations in a credit managed by another Person. 

"Loan Participation Agreement" shall mean an agreement under which the Failed Bank 

or the Receiver was the lead or agent financial depository institution or otherwise managed or 

held a shared credit or sold participations, or under which the Failed Bank or the Receiver was a 

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

another Person. 

"Loan Proceeds" shall mean (i) any and all proceeds (net of such proceeds as are 

payable to others under any Loan Participation Agreement) with respect to any or all ofthe 

Loans and any or all ofthe Collateral that is received at any time after the Servicing Transfer 

Date, including principal, interest, default interest, prepayment fees, premiums and charges, 

extension and exit fees, late fees, assumption fees, other fees and charges, insurance proceeds 

and condemnation payments (or any portion thereof) that are not used and disbursed to repair, 

replace or restore the related Collateral in accordance with the terms of the Loan Documents, (ii) 

any and all proceeds from sales or other dispositions of any or all of the Loans or the Collateral, 

(iii) any proceeds from making a draw under any letter of credit or certificate of deposit held 

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

Documents, (iv) any recoveries ofPre-Cut-OffDate Advances or other recoveries from 

Borrowers or Guarantors of any kind or nature with respect to the Loans, and (v) any interest or 

other earnings accrued and paid on any ofthe amounts described in the foregoing clauses (i) 

through (iv) while held in the Collection Account or any Other Account. 

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

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

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

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

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

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

agreement, shared credit or Loan Participation Agreement, intercreditor agreement, 

reimbursement agreement, any other evidence ofindebtedness of any kind, or any other 

agreement, document or instrument evidencing a Loan, and all Modifications to the foregoing. 

"Other Accounts" shall have the meaning given in Section 2.08. 

"Participant" shall have the meaning given in the second Recital ofthis Agreement. 

"Participation Agreement" shall have the meaning given in the second Recital ofthis 

Agreement. 

"Permitted Investments" shall mean any one or more ofthe following obligations or 

securities having at the time ofpurchase, or at such other time as may be specified, the required 

ratings, if any, provided for in this definition: 

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(1) direct obligations of, or guaranteed as to timely payment ofprincipal and 

interest by, the United States ofAmerica or any agency or instrumentality ofthe United 

States ofAmerica, the obligations of which are backed by the full faith and credit ofthe 

United States ofAmerica; 

(2) demand and time deposits in or certificates of deposit of, or bankers' 

acceptances issued by, any bank or trust company, savings and loan association or 

savings bank, provided that, in the case of obligations that are not fully FDIC-insured 

deposits, the commercial paper and/or long-term unsecured debt obligations ofsuch 

depository institution or trust company (or in the case ofthe principal depository 

institution in a holding company system, the commercial paper or long-term unsecured 

debt obligations of such holding company) have an Acceptable Rating; 

(3) general obligations of or obligations guaranteed by any state of the United 

States or the District of Columbia receiving ratings of not less than the highest rating of 

each Rating Agency rating such obligations; 

(4) mutual funds in which investments are limited to the obligations referred 

to in clauses (I), (2) or (3) of this definition; and 

(5) with the prior written consent of the Company, any other demand, money 

market or time deposit or other obligation, security or investment. 

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

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

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

entity. 

"Pre-Cut-Off Date Advances" shall mean advances made by or on behalf of the Failed 

Bank or the Receiver (or any assignor that conveyed the Loans to the Failed Bank or the 

Receiver) on or prior to the Cut-OffDate to fund Servicing Expenses. 

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

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

business are necessary for the servicing of the Loans and management ofthe Collateral and the 

Acquired Collateral, (ii) has the management capacity and experience to service loans ofthe type 

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

residential or commercial properties, including the number and types ofloans serviced, and the 

ability to track, process and post payments, to furnish tax reports to borrowers, to monitor 

construction and disburse construction draws, (iii) either (x) has an Acceptable Rating as a 

mortgage loan servicer or special servicer or (y) is an FDIC-insured depository institution or an 

Affiliate of an FDIC-insured depository institution, and (iv) in the case of any mortgage loan 

servicer or special servicer that does not have an Acceptable Rating, is acceptable to and 

approved by the Participant (such approval not to be unreasonably withheld, delayed or 

conditioned). 

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FDIC FNBN CMLCON Servicing Agreement-EXECUTION VERSION 

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"Rating Agencies" shall mean each ofMoody's Investors Service, Inc., Standard & 

Poor's Rating Services, a division ofThe McGraw-Hill Companies, Inc., Fitch IBCA, Inc. and 

such other rating agencies as are nationally recognized. 

"Receiver" shall have the meaning given in the second Recital ofthis Agreement. 

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

same may be amended from time to time. 

"Servicer" shall have the meaning given in the Preamble. 

"Servicer Advances" shall mean (a) advances made by or on behalf ofthe Servicer to 

fund Servicing Expenses and (b) to the extent not covered by clause (a), any and all legal fees 

and expenses (including judgments, settlements and reasonable attorneys' fees) incurred by the 

Servicer in its defense of claims asserted against the Company that (x) relate to one or more 

Loans, and (y) arise out of acts or omissions of the Failed Bank or the Receiver in connection 

with the origination or servicing of such Loans prior to the Servicing Transfer Date. 

"Servicer Remittance Date" shall mean the 1 o'h day of each month, or such other day 

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

day is not a Business Day, the Servicer Remittance Date shall be the immediately preceding 

Business Day. 

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

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

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

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

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

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

the Collateral or the priority of the Liens and security interests created by the Loan Documents 

relating thereto, including taxes, insurance premiums (including forced place insurance 

premiums), payment of ground rent, the costs of prevention ofwaste, repairs and maintenance, 

foreclosure expenses and legal fees and expenses relating to foreclosure or other litigation with 

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

demolition, management and sale of the Acquired Collateral (including real estate brokerage fees 

and amounts disbursed to complete partially completed projects), and (iv) to the extent not 

covered by any of clauses (i) through (iii), legal fees and expenses (including judgments, 

settlements and reasonable attorneys fees) incurred by the Servicer in its defense of claims 

asserted against the Company that relate to one or more Loans, and (x) arise out ofthe acts or 

omissions ofthe Failed Bank or the Receiver in connection with the origination or servicing of 

such Loans prior to the Servicing Transfer Date, or (y) allege, as the basis for such claims, any 

act or omission of the Company (or its Servicer) and such claims are decided (and there are final 

non appealable orders) in favor of the Company (or its Servicer); provided, however, that 

Servicing Expenses shall not include Authorized Funding Draws or Excluded Expenses. 

"Servicing Fee" shall have the meaning given in Section 2.03. 

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FDJC FNBN CMLCON Servicing Agreement-EXECUTION VERSION 

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"Servicing Obligations" shall have the meaning given in Section 2.04. 

"Servicing Standard" shall have the meaning given in Section 2.04. 

"Servicing Transfer Date" shall be on or before February 27, 2009, or such other date as 

is agreed to by the Servicer and the Company. 

"Site Assessment" shall have the meaning given in Section 3.03. 

"Subservicer" shall have the meaning given in Section 4.01. 

"Subservicing Agreement" shall have the meaning given in Section 4.02. 

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

Article VII. 

"Uniform Commercial Code" shall mean, with respect to each discrete element or 

category ofthe personal property Collateral, the Uniform Commercial Code in effect in the 

applicable jurisdiction, as the same may be amended from time to time. 

"Unpaid Principal Balance" shall mean, at any time, an amount equal to the then 

aggregate outstanding principal balance of the Loans and, for each Loan with respect to which 

some or all ofthe related Collateral has been converted to Acquired Collateral and, until such 

time as the Acquired Collateral (or any portion thereoJ) is liquidated, the unpaid principal 

balance ofthe related Loan (adjusted pro rata for partial collateral sales, debt forgiveness or 

retained indebtedness) at the time at which such Loan was converted to Acquired Collateral plus 

any outstanding balance remaining on such Loan which is evidenced by a modification 

agreement or a replacement or successor promissory note executed by the Borrower. 

ARTICLE II 


SERVICING OBLIGATIONS OF THE SERVICER 


Section 2.01 Appointment and Acceptance as Servicer. Effective as of the date hereof, 

the Company appoints the Servicer to service, administer, manage and dispose of the Loans and 

the Collateral on behalf of and as an agent ofthe Company. 

Section 2.02 Limited Power of Attorney. The Company hereby grants to the Servicer a 

limited power of attorney to execute all documents on its behalf in accordance with the Servicing 

Standard set forth below and as may be necessary to effectuate the Servicer's obligations under 

this Agreement until such time as the Company revokes said limited power of attorney. 

Revocation of the limited power of attorney shall take effect upon: (i) the receipt by the Servicer 

ofwritten notice thereof from or on behalf ofthe Company, or (ii) termination of this Agreement 

pursuant to Article VII. 

Section 2.03 Servicing Fee. As consideration for servicing the Loans and the 

Collateral, on each Servicer Remittance Date, the Servicer shall be paid such monthly servicing 

fee as is set forth on the Fee Schedule (the "Servicing Fee"). 

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Section 2.04 Servicing Standard. The Servicer shall take such actions and perform such 

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

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

the Company and the Servicer without the Participant's consent (the "Servicing Obligations"). 

The Servicer shall perform its Servicing Obligations (i) in the best interests and for the benefit of 

the Participant and the Company, (ii) in accordance with the terms ofthe Loans (and related 

Loan Documents), (iii) in accordance with the tenns of this Agreement (including this Article 

II), (iv) in accordance with all applicable Law, (v) with respect to all Loans, in compliance with 

the Statement on Loss Mitigation Strategies for Servicers ofResidential Mortgages (September 

2007), issued by the federal financial institutions regulatory agencies and the Conference of State 

Bank Supervisors, and the Statement on Working with Mortgage Borrowers (April 2007), issued 

by the federal financial institutions regulatory agencies, as the same may be amended, 

supplemented or modified from time to time (collectively, the "Guidelines"), to the extent 

applicable, and, (vi) to the extent consistent with the foregoing terms, in the same manner in 

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

servicer would manage and administer similar properties for its own portfolio or for other 

Persons, whichever standard is higher, but using no less care and diligence than would be 

customarily employed by a prudent servicer following customary and usual standards ofpractice 

of prudent mortgage lenders, loan servicers and asset managers servicing, managing and 

administering similar loans and properties on an arms' length basis, provided that in the absence 

of a customary and usual standard of practice, the Servicer shall comply with the Fannie Mae 

Guidelines applicable to similar loans or properties in similar situations (the requirements in 

clauses (i) through (vi) collectively, the "Servicing Standard"). In addition, the Servicer shall 

perform its Servicing Obligations without regard to (a) any relationship that the Servicer, the 

Company or any Subservicer or any oftheir respective Affiliates may have to any Borrower, 

Guarantor or other obligor or any oftheir respective Affiliates, including any other banking or 

lending relationship, (b) the Company's, the Servicer's, or any Subservicer's, obligation to make 

disbursements and advances with respect to the Loans and the Collateral, (c) any relationship 

that the Servicer or any Subservicer may have to each other or to the Company or any ofits 

Affiliates, or any relationship that any of their respective Affiliates may have to the Company or 

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

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

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

Subservicing Agreement. 

Section 2.05 Collection Account. 

(a) Except as otherwise directed by the Company, on or prior to the Servicing 

Transfer Date, the Servicer (i) shall establish and maintain an Eligible Account, which shall be 

held in trust for the benefit of the Company and the Participant and shall be for the sole purpose 

ofholding and distributing the Loan Proceeds (the "Collection Account"); and (ii) shall deposit 

into the Collection Account all Loan Proceeds on a daily basis (without deduction or setoff as 

provided in Section 11.13 hereof). Exeept as otherwise directed by the Company, the Servieer 

shall not cause or allow funds from any other source (other than interest or earnings on the Loan 

Proceeds) to be commingled in the Collection Account. 

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(b) Except as otherwise directed by the Company, each Servicer Remittance 

Date, the Servicer shall remit all amounts then on deposit in the Collection Account to the 

Company. 

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

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

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

Agreement; provided, however, that ifthe Servicer or any Subservicer erroneously deposits any 

amounts into the Collection Account, it may withdraw such erroneously deposited amount. 

(d) Except as otherwise directed by the Company, any and all amounts due 

the Company under this Agreement shall be remitted by wire transfer, in immediately available 

funds to such account or accounts as the Company may, from time to time, direct. 

(e) Except as otherwise directed by the Company, amounts on deposit in the 

Collection Account shaH be invested in Permitted Investments, but with a maturity that allows 

for their a11ocation and distribution on a monthly basis in accordance with this Agreement. 

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

account control agreement among the Company, the Participant and the Eligible Institution that 

holds such Collection Account. 

Section 2.06 LIP Account. 

(a) Except as otherwise directed by the Company, on or prior to the Servicing 

Transfer Date, the Servicer shall establish and maintain the LIP Account, which shall be held in 

trust for the benefit of the Company and the Participant and which shall be funded with any 

initial principal amount of$37,571,664.00 (the "LIP Funds"). No funds from any other source 

(other than interest or earnings on the LIP Funds) shall be commingled in the LIP Account. 

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

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

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

Agreement. 

(c) The Servicer shall be authorized, at the Company's direction, to withdraw 

funds (or to make draw requests on the escrow agent for the funds) from the LIP Account on! y to 

make Authorized Funding Draws, and the LIP Account and the LIP Funds shall not otherwise be 

used for any purpose. The Servicer shall not permit withdrawals from the LIP Account for any 

other purpose. On the Servicing Transfer Date, the participant shall be reimbursed from the LIP 

Account an amount equal to the Authorized Funding Draws made by it at any time after the CutOffDate and on or before the Servicing Transfer Date. 

(d) At the direction of the Company, the LIP Account shall be liquidated (and 

no further Authorized Funding Draws may be made on or after the date of such direction), and 

all remaining LIP Funds then on deposit in the LIP Account, including all interest and earnings 

thereon, shall be distributed to the Company. 

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(e) The LIP Account (and all funds therein) shall be subject to an account 

control agreement among the Company, the Participant and the Eligible Institution that holds 

such LIP Account. 

(f) The LIP Funds shall be invested in Permitted Investments, but with a 

maturity that allows for (i) distribution ofthe LIP Funds as and when needed to make Authorized 

Funding Draws and (ii) liquidation ofthe LIP Account and distribution ofthe remaining LIP 

Funds (which liquidation and distribution shall be at such time and in such manner as is directed 

by the Company to the Servicer). 

Section 2.07 Escrow Accounts. Except as otherwise direeted by the Company, the 

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

in trust for the benefit ofthe Company and Participant ("Escrow Accounts"). Except as 

otherwise directed by the Company, the Servicer shall deposit into the Escrow Account on a 

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

insurance premiums, and comparable items for the account ofthe Borrowers, and the Servieer 

shall pay to the Borrowers interest on funds in Escrow Accounts to the extent required by law. 

Section 2.08 Other Accounts. At the direction ofthe Company, the Servicer shall 

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

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

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

("Other Accounts"). 

Section 2.09 Maintenance oflnsurance Policies; Errors and Omissions and Fidelity 

Coverage. 

(a) The Servicer and each Subservicer shall cause to be maintained for the 

Collateral (including any Acquired Collateral) from an insurer reasonably acceptable to the 

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

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

the area in which the Collateral is located and in such amounts and with such deductibles as, 

from time to time, is directed by the Company. 

(b) The Servicer and each Subservicer shall at all times maintain in effect a 

blanket fidelity bond and an errors and omissions insurance policy affording, in each case, 

coverage with respect to all officers, directors, employees and other Persons acting on behalfof 

the Servicer or the Subservicer, as applicable, and covering errors and omissions in the 

performance ofthe Servicer's, or the Subservicer's, as applicable, obligations under this 

Agreement or any Subservicing Agreement. The errors and omissions insurance policy and the 

fidelity bond shall be in such form and amount that would meet the requirements ofFannie Mae 

if Fannie Mae were the purchaser ofthe Loans. The Servicer and each Subservicer shall provide 

the Company with certificates evidencing such coverage. 

(c) Copies offidelity bonds and insurance policies required to be maintained 

pursuant to this Section shall be made available to the Company and its representatives upon 

request. 

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Section 2.10 Expenses. Except as otherwise directed by the Company, the Servicer 

shall use its reasonable best efforts to recover from Borrowers and Guarantors all Servicing 

'Expenses that are Servicer Advances. All such Servicing Expenses not recovered from 

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

with the terms set forth on Schedule 3, as the same may be amended from time to time by the 

Company and the Servicer without the Participant's consent. In the event the Servicer is 

reimbursed for any expense that is not, or cannot be documented as, a Servicer Advance, in the 

reasonable determination ofthe Company, the Servicer shall be obligated to refund such amounts 

to the Company on the Servicer Remittance Date immediately following the Servicer's receipt of 

notice from the Company requesting the same. No Servicer Advances shall bear interest 

chargeable in any way to the Company or deductible from any Loan Proceeds. 

Section 2.11 Insured or Guaranteed Loans. If any Loans being serviced pursuant to this 

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

acknowledges and agrees that, ifthe Company so directs pursuant to the Servicing Obligations 

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

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

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

Agreement, it agrees to fulfill all ofthe Company's obligations under the contracts ofinsurance 

or guaranty. 

ARTICLE III 


LOAN DEFAULTS; ACQUISITION OF COLLATERAL 


Section 3.01 Delinquency Control. Except as otherwise directed by the Company, the 

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

Standard and protect the Company's investment in the Loans in accordance with the Servicing 

Standard with Borrowers who are delinquent or in default. 

Section 3.02 Discretion ofthe Company in Responding to Defaults ofBorrower. Upon 

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

terms and conditions ofthis Agreement, including the Servicing Obligations ofthe Servicer and 

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

compliance with the Servicing Standard, the Servicer shall cause to be determined the response 

to such default and course of action with respect to such default, including (a) the selection of 

attorneys to be used in connection with any action, whether judicial or otherwise, to protect the 

respective interests ofthe Company and the Participant in the Loan and the Collateral, (b) the 

declaration and recording of a notice ofsuch default and the acceleration ofthe maturity ofthe 

Loan, (c) the institution of proceedings to foreclose the Loan Documents securing the Loan 

pursuant to the power ofsale contained therein or through a judicial action, (d) the institution of 

proceedings against any Guarantor, (e) the acceptance of a deed in lieu offoreclosure, (f) the 

purchase ofthe 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 (g) the institution or 

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

Guarantor and the collection ofsuch judgment. 

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Section 3.03 Acquisition of Acquired Collateral. Any acquisition ofCollateral shall 

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

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

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

Servicer shall immediately provide written notice of same to the Company. In addition, if the 

Company so directs, prior to the acquisition of title to any Collateral, the Servicer shall cause to 

be commissioned with respect to such Collateral (i) a Transaction Screen Process consistent with 

ASTM Standard E 1528-06, by an environmental professional or (ii) such other site inspections 

and assessments by a Person who regularly conducts environmental audits using customary 

industry standards as would customarily be undertaken or obtained by a prudent lender in order 

to ascertain whether there are any actual or threatened Environmental Hazards (a "Site 

Assessment"). Except as is otherwise directed by the Company, the Servicer or any Subservicer 

shall not acquire or otherwise cause the Company or any other ownership entity to acquire all or 

any portion of any Collateral having any actual or threatened Environmental Hazards by 

foreclosure, deed in lieu of foreclosure, power of sale or sale pursuant to the Uniform 

Commercial Code or otherwise. 

ARTICLE IV 


SUBSERVICING 


Section 4.01 Retention of Subservicer. The Servicer may engage or retain one or more 

subservicers, including Affiliates ofthe Company or ofthe Servicer (individually and 

collectively, "Subservicer"), as it may deem necessary and appropriate, provided that any 

Subservicer meets the requirements set forth in clause (i) and, to the extent applicable to the 

services to be performed by such Subservicer, clause (ii) of the definition ofQualified Servicer. 

Section 4.02 Subservicing Agreement Requirements. Any subservicing agreement with 

any Subservicer ("Subservicing Agreement") shall, among other things: 

(a) provide for the servicing ofthe Loans and management ofthe Collateral by the 

Subservicer in accordance with the Servicing Standard and the other terms ofthis Agreement; 

(b) be terminable with or without cause, upon no more than thirty (30) days prior 

notice in the event of any Default under this Agreement or a default under the Subservicing 

Agreement as set forth in Section 4.02(n) below; 

(c) provide that the Servicer as well as the Company and the Participant shall be 

entitled to exercise termination rights thereunder; 

(d) provide that the Subservicer and the Servicer acknowledge that the Sub servicing 

Agreement constitutes a personal services agreement between the Servicer and the Subservicer; 

(e) provide that each ofthe Participant and the Company is a third party beneficiary 

thereunder and entitled to enforce the Subservicing Agreement; 

(f) provide that (i) upon a Default under this Agreement, the Company and 

Participant may exercise all ofthe rights of (A ) the Company under this Agreement and cause 

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the termination or assignment of this Agreement to any other Person, without penalty or payment 

of any fee, and (B) the Servicer under any or or all ofthe Subservicing Agreements entered into 

by the Servicer and cause the termination or assignment of the same to any other Person, without 

penalty or payment of any fee, and (ii) upon a default under any Subservicing Agreement, 

provide that the Company and Participant may exercise all of the rights of the Servicer under 

such Subservicing Agreement and cause the termination or assignment of any such Subservicing 

Agreement to any other Person, without penalty or payment of any fee; 

(g) provide that the Company and the Participant (and each oftheir respective 

representatives) shall have access to and the right to review, copy and audit the books and 

records ofthe Subservicer and that the Subservicer shall make available its officers, directors, 

employees, accountants and attorneys to the Company and the Participant (and each of their 

respective representatives) to answer questions or to discuss any matter relating to the 

Subservicer's affairs, finances and accounts, as they relate to the Loans, the Collateral, the 

Servicing Obligations, the Collection Account, the LIP Account, the Escrow Accounts or any 

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

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

or obligations thereunder; 

(h) provide that all Loan Proceeds are to be deposited into the Collection Account on 

a daily basis (without reduction or setoff as provided in Section 11.13 hereof) and that under no 

circumstances are any funds, other than Loan Proceeds and interest and earnings thereon, to be 

deposited into the Collection Account; 

(i) provide that under no circumstances are any funds, other than the LIP Funds and 

interest and earnings thereon, to be deposited into the LIP Account; 

G) provide that the Subservicer shall not transfer or assign its rights under the 

Subservicing Agreement with the Servicer and that any prohibited transaction shall be void ab 

initio; 

(k) provide that the Subservicer consents to the immediate termination ofthe 

Subservicer pursuant to Section 7.02 of this Agreement; 

(I) provide that there shall be no right of setoff on the part ofthe Subservicer, 

(m) provide for such other matters as are necessary or appropriate to ensure that the 

Subservicer is obligated to comply with the Servicing Obligations of the Servicer hereunder in 

the conduct of such matters as are delegated to the Subservicer, 

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

parallel the provisions of Sections 7.01(a), (b), (c), (d), (e), (t) and (h) ofthis Agreement, and 

(ii) provide that the Participant has the right (x) to terminate the Subservicing Agreement by 

providing written notice upon the occurrence of any such default (except that, with respect to 

default under the provision that parallels Section 7.01(c), only with respect to the provisions that 

parallel Sections 5.02(1) and (g) that shall be referred to therein), without any cure period other 

than as may be provided for in the default provisions that parallel provisions in Section 7 .01, and 

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FDIC FNBN CMLCON Servicing Agreement-EXECUTION VERSION 

12349237.5 
upon the occurrence of any Default under any of Sections 7.01(a), (b), (c) (but, with respect to a 

Default under clause (c), only with respect to Sections 5.02(f) and (g) referred to therein), (d), 

(e), (f) or (h) of this Agreement, and (y) otherwise to enforce the rights ofthe Servicer under the 

Subservicing Agreement; 

(o) provide that (i) the Subservicer consents to its immediate termination under the 

Subservicing Agreement upon a Default under Section 7.01(b) ofthis Agreement and upon the 

occurrence of any Insolvency Event with respect to the Subservicer or any of its Affiliates, and 

(ii) the occurrence of any Insolvency Event with respect to the Subservicer or any Affiliate 

thereof constitutes a default under the Subservicing Agreement; and 

(p) provide a full release and discharge ofthe Participant and any predecessor 

servicer, and all of their respective officers, directors, employees, agents, attorneys, contractors 

and representatives, and all of their respective successors and assigns (other than the Company) 

and Affiliates, from any and all claims (including any counterclaim or defensive claim), 

demands, causes of action, judgments or legal proceedings and remedies ofwhatever kind or 

nature that the Subservicer had, has or might have in the future, whether known or unknown, 

which are related in any manner whatsoever to that servicing ofthe Loans by the Participant or 

such other predecessor servicer prior to the Servicing Transfer Date (other than due to gross 

negligence or willful misconduct ofthe Participant or other predeccessor servicer). 

Section 4.03 Servicer Liable for Subservicers. Notwithstanding anything to the 

contrary contained herein, the use of any Subservicer shall not release the Servicer from any of 

its Servicing Obligations or other obligations under this Agreement, and the Servicer shall 

remain responsible and liable for all acts and omissions ofeach Subservicer as fully as ifsuch 

acts and omissions were those of the Servicer. All actions of any Subservicer performed 

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

Servicer. No Subservicer shall be paid any fees or indemnified out of any Loan Proceeds. 

Section 4.04 Company Approval Required. Each Subservicing Agreement and all 

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

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

approval ofthe Company (which approval shall not be unreasonably withheld, delayed or 

conditioned). A copy of all Subservicing Agreements, as executed and delivered and all 

amendments thereto, shall be provided to the Company. 

Section 4.05 Regulation AB Requirements. The Servicer shall ensure, where 

applicable, that each Subservicer (A) has in place policies and procedures to comply with the 

provisions ofSection 1122(d)(l)(i) through (iv) of Regulation AB, and (B) complies with the 

provisions of Sections 1122(d)(2)(i) through (vii), 1122(d)(3)(i) through (iv), and 1122(d)(4)(i) 

through (xv) of Regulation AB (regardless ofwhether any such requirements apply, by their 

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

Commission). 

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ARTICLE V 

REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SERVICER 

Section 5.01 Representations and Warranties. The Servicer hereby makes the following 

representations and warranties as ofthe date hereof: 

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

good standing under the laws ofthe State ofNevada; (ii) has qualified or will qualify to transact 

business as a foreign entity and will remain so qualified, in the state or states and other 

jurisdictions where the Loans or the nature ofthe Servicer's activities under this Agreement 

makes such qualification necessary; (iii) has all licenses and other governmental approvals 

necessary to carry on its business as now being conducted and to perform its obligations 

hereunder; and (iv) has established and shall maintain its principal place of business in the 

United States. 

(b) The Servicer has all requisite power, authority and legal right to service 

each Loan, and to execute, deliver and perform, and to enter into and consummate the 

transactions contemplated by, this Agreement, and this Agreement has been duly authorized by 

all requisite corporate action on the part ofthe Servicer. 

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

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

the Servicer, except as such enforcement may be limited by bankruptcy, insolvency, 

reorganization or other similar laws affecting the enforcement of creditors' rights generally, and 

by general principles of equity (regardless of whether such enforcement is considered in a 

proceeding in equity or at law); and all requisite corporate action has been taken by the Servicer 

to make this Agreement and all agreements contemplated hereby to which the Servicer is or will 

be a party valid and binding upon the Servicer in accordance with their terms and conditions. 

(d) The Persons executing this Agreement on behalf ofthe Servicer are duly 

authorized to do so. 

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

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

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

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

breach of any term or provision ofthe articles or charter or bylaws or operating agreement ofthe 

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

(or an event which, with notice or lapse oftime, or both, would constitute a default) under the 

terms of any agreement or other instrument to which the Servicer is a party or by which it may 

be bound; or (iii) constitute a violation of any Law applicable to the Servicer, and the Servicer is 

not in breach or violation of any agreement or instrument, or in violation of any Law of any 

Governmental Authority having jurisdiction over it which breach or violation may impair the 

Servicer's ability to perform or meet any ofits obligations under this Agreement. 

(f) No litigation is pending or threatened against the Servicer that would 

prohibit the Servicer from entering into this Agreement or is likely to materially and adversely 

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12349237.5 
affect either the ability ofthe Servicer to perform its obligations under this Agreement or the 


financial condition ofthe Servicer. 


(g) Any consent, approval, authorization or order of any Governmental 

Authority required for the execution, delivery and performance by the Servicer of or compliance 

by the Servicer with this Agreement or the consummation ofthe transactions contemplated by 

this Agreement has been obtained and is effective. 

(h) Neither the Servicer nor any Subservicer or their respective Affiliates 

shall, at any time, (i) be a partner or joint venturer with any Borrower, (ii) be an agent of any 

Borrower, or allow any Borrower to be an agent ofthe Servicer or any Subservicer, or (iii) have 

any interest whatsoever in any Borrower, Guarantor or other obligor with respect to any Loan or 

any ofthe Collateral. 

Section 5.02 Reporting, Books and Records and Compliance Covenants. The Servicer 

covenants to the Company as follows: 

(a) The Servicer shall be responsible for submitting all Internal Revenue 

Service information returns related to the Loans for all applicable periods commencing with the 

Servicing Transfer Date. Information returns include reports on Forms I 098 and 1099 and any 

other reports required by Law. The Servicer shall be responsible for submitting all information 

returns required under applicable Law of any foreign Governmental Authority, to the extent such 

are required to be filed by the Company under such Law, relating to the Loans, for the calendar 

or tax year in which the Effective Date falls and thereafter. 

(b) The Servicer shall cause to be kept and maintained (including by any 

Subservicer and including records transferred by the Company to the Servicer), at all times, at 

the Servicer's principal place ofbusiness, a complete and accurate set of files, books and records 

regarding the Loans and the Collateral, and the Company's interests in the Loans and the 

Collateral, including records relating to the Collection Account, the LIP Account and any Other 

Accounts maintained in connection with the Loans and Servicer Advances. 

(c) The Servicer shall cause all such books and records to be maintained and 

retained until the date that is the later often (1 0) years after the Effective Date ofthis Agreement 

or three (3) years after the date on which the final Loan Proceeds are distributed to the Company, 

which date shall be established by notice to the Servicer from the Company. All such books and 

records shall be available during such period for inspection by the Company and the Participant 

(and their representatives, including any applicable Governmental Authority) at all reasonable 

times during business hours on any Business Days (or, in the case of any such inspection after 

the term hereof, at such other location as is provided by notice to the Company and the 

Participant, as applicable), in each instance upon two (2) Business Days' prior notice to the 

Servicer. Upon request by the Company, the Servicer, at the sole cost and expense ofthe 

Company, shall promptly send copies (the number of copies ofwhich shall be reasonable) of 

such books and records to the Company. The Servicer shall provide the Company with 

reasonable advance notice ofthe Servicer's intention to destroy or dispose of any documents or 

files relating to the Loans and, upon the request ofthe Company, shall allow the Company, at its 

own expense, to recover the same from the Servicer. The Servicer shall also maintain complete 

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12349237.5 
and accurate records reflecting the status of taxes, ground rents and other recurring charges 

generally accepted by the mortgage servicing industry, which would become a Lien on the 

security property. 

(d) The covenants set forth in Section 5.02(b) and (c) above to maintain a 

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

possession or control pertaining to the Loans and the Collateral, including all original and other 

documentation pertaining to the Loans and the Collateral, all documentation relating to items of 

income and expense pertaining to the Loans and the Collateral, and all of the Servicer's (and 

Subservicer's) internal memoranda pertaining to the Loans and the Collateral. 

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

the Servicer Remittance Date, commencing the first month following the Servicing Transfer 

Date, a monthly Electronic Report on the Loans and Collateral containing such information and 

substantially in the form set forth on Schedule 4, as the same may be amended from time to time 

by the Company and the Servicer without the Participant's consent. 

(f) The Servicer shall deliver, and shall cause each Subservicer to deliver to 

the Company, on or before March I 01

h of each year, or such other day as the Company and the 

Servicer may agree, commencing in the year 2010, an officer's certificate stating, as to the signer 

thereof, that (i) a review ofsuch party's activities during the preceding calendar year (or portion 

thereof) and of its performance under this Agreement (or, as applicable, any Subservicing 

Agreement) has been made under such officer's supervision, and (ii) to the best of such officer's 

knowledge and belief, based on such review, such party has fulfilled all ofits obligations under 

this Agreement (or, as applicable, any Subservicing Agreement) in all material respects 

throughout such year or portion thereof or, if there has been a failure to fulfill any such 

obligation in any material respect, specifying each such failure and the nature and status thereof. 

In the event any Subservicer was terminated, resigned or otherwise performed in such capacity 

for only part of a year, such party shall provide such annual compliance certificate with respect 

to such portion ofthe year. 

(g) On or before March I 01

h of each year, or such other day as the Company 

and the Servicer agree, commencing in the year 2010, the Servicer shall, and shall cause each 

Subservicer to, each at its own expense or the expense ofthe Company, provide a report 

prepared by a nationally recognized firm ofindependent certified public accountants to the effect 

that, with respect to the most recently ended fiscal year, such firm has examined certain records 

and documents relating to compliance with the servicing requirements in this Agreement and 

that, on the basis of such examination conducted substantially in compliance with the Uniform 

Single Attestation Program for Mortgage Bankers , such firm is ofthe opinion that the Servicer 

(or Subservicer's) activities have been conducted in compliance with this Agreement (including, 

to the extent applicable, Regulation AB), 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. 

Section 5.03 Audits. Until the later ofthe date that is ten (I 0) years after the Effective 

Date and the date that is three (3) years after the date on which the final Loan Proceeds are 

distributed to the Company, which date shall be established by notice to the Servicer from the 

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Company, the Servicer shall, and shall cause each Subservicer to, (a) provide the Company and 

the Participant and their respective representatives (including any government agency or 

instrumentality), during normal business hours and on reasonable notice, with access to and the 

right to review all of the books of account, reports and records relating to the Loans or any 

Collateral, the Servicing Obligations, the Collection Account, the LIP Account, the Escrow 

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

obligations hereunder, (b) permit such representatives to make copies of and extracts from the 

same, (c) allow the Company and the Participant to cause such books to be audited by 

accountants selected by the Company or the Participant, as applicable, and (d) allow the 

Company and the Participant to discuss the Servicer's and Subservicer's affairs, finances and 

accounts, as they relate to the Loans, the Collateral, the Servicing Obligations, the Collection 

Account, the LIP Account, the Escrow Accounts, and any Other Accounts or any other matters 

relating to this Agreement or the rights or obligations hereunder, with its officers, directors, 

employees, accountants (and by this provision the Servicer hereby authorizes such accountants to 

discuss such affairs, finances and accounts with such representatives), Subservicers, and 

attorneys. 

Section 5.04 No Liens. The Servicer shall not place or permit (voluntarily or 

involuntarily) any Lien to be placed on any of the Loans, the Collateral, the Loan Documents or 

the Loan Proceeds, and shall not take any action to interfere with the Participant's rights as a 

secured party with respect to the Loans, the Collateral and the Loan Proceeds. 

Section 5.05 Servicer's Duty to Advise; Delivery of Certain Notices. In addition to 

such other reports and access to records and reports as are required to be provided to the 

Company and the Participant hereunder, the Servicer shall cause to be delivered to the Company 

and the Participant, such information relating to the Loans, the Collateral, the Servicer and any 

Subservicer as the Company or the Participant may reasonably request from time to time and, in 

any case, shall ensure that the Company and the Participant are promptly advised, in writing, of 

any matter ofwhich the Servicer or Subservicer becomes aware relating to the Loans, any of the 

Collateral, the Collection Account, Escrow Accounts, any Other Accounts or any Borrower or 

Guarantor that materially and adversely affects the interests ofthe Company or the Participant. 

Without limiting the generality ofthe foregoing, the Servicer shall immediately notify the 

Company and the Participant of any claim, threatened claim or litigation against the Company 

arising out of any Loan and shall cause to be delivered to the Company and the Participant 

information indicating any possible Environmental Hazards with respect to any Collateral. 

Section 5.06 Notice ofBreach. The Servicer shall immediately notify the Company 

and the Participant of any failure or anticipated failure on its part to observe and perform any 

warranty, representation, covenant or agreement required to be observed and performed by it as 

the Servicer. 

ARTICLE VI 


PARTICIPANT CONSENT 


Section 6.01 Actions Requiring Participant Consent. Notwithstanding anything to the 

contrary contained in this Agreement, neither the Company nor the Servicer shall permit to be 

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taken any of the following actions without the prior written consent of the Participant, which 

may be withheld or conditioned in the Participant's sole and absolute discretion: 

(a) the sale or other transfer of any Loan or Collateral (or any portion thereof) 

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

any Affiliate of any Subservicer; 

(b) the financing of the sale or other transfer of any Loan or Collateral (or any 

portion thereof); 

(c) the sale of any Loan or Collateral (or any portion thereof) that provides for 

any recourse against the Company (except as otherwise permitted by the Company) or the 

Participant or any share of the Loan Proceeds allocable to the Participant; 

(d) any disbursement of any funds in the Collection Account, the LIP Account 

or any Other Accounts other than in accordance with the provisions of this Agreement; 

(e) other than capitalizing accrued and unpaid interest, Pre-Cut -Off Date 

Advances, Servicing Advances and Authorized Funding Draws, advancing additional funds that 

would increase the Unpaid Principal Balance; or 

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

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

Section 6.02 Amendments, Modification and Waivers. No provision of this Agreement 

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

Servicer and, except for those provisions that may be amended without the Participant's consent, 

as and to the extent expressly provided in this Agreement, each such amendment and 

modification shall be subject to the prior written consent of the Participant (which consent shall 

not be unreasonably withheld, delayed or conditioned). 

ARTICLE VII 

DEFAULTS; TERMINATION; TERMINATION WITHOUT CAUSE 

Section 7.01 Defaults. A default ("Default") means the occurence of: 

(a) any failure by the Servicer to remit to the Company or deposit in the 

Collection Account, the LIP Account, the Escrow Accounts or any Other Accounts any amount 

required to be so remitted or deposited under the terms of this Agreement in any case which 

continues unremedied until12:00 p.m. New York time on the Business Day immediately 

following the date upon which written notice of such failure, requiring the same to be remedied, 

shall have been given by the Company to the Servicer; or 

(b) any Insolvency Event (without any cure period other than as may be 

provided for in the definition of Insolvency Event) with respect to the Servicer or any Affiliate 

therof, or any Subservicer or any Affiliate thereof; or 

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

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

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

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

Section 5.02(t) or 5.02(g), which failure continues unremedied for a period oftwenty-five (25) 

days, or such other period as the Company and the Servicer agree, after the date on which written 

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

to the Servicer; or 

(d) any failure by the Servicer to cause to be remitted to the Company any 

payment required to be made to the Company under the terms ofthis Agreement, as set forth in 

the monthly cash flow and distribution report, in either case which continues unremedied until 

12:00 p.m. New York time on the Business Day immediately following the date upon which 

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

Company to the Servicer; or 

(e) any failure by the Servicer at any time (i) to comply with its obligation to 

be a Qualified Servicer and to renew or maintain any permit or license necessary to carry out its 

responsibilities under this Agreement in compliance with Law, or (ii) to cause each Subservicer 

to be a Qualified Servieer and to renew or maintain any permit or license necessary to carry out 

its responsibilities under any Subservicing Agreement, which, in the case of either (i) or (ii), 

continues unremedied for a period ofthirty (30) days after the date on which written notice of 

such failure requiring the same to be remedied shall have been given by the Company to the 

Servicer; or 

(t) the occurrence of any event of default or material breach by the Servicer 

under this Agreement, which continues unremedied for a period ofthirty (30) days after the date 

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

by the Company to the Servicer; or 

(g) any failure by the Servicer to cause any Subservicer to comply with the 

terms of its Subservicing Agreement with the Servicer, the occurrence of a default or material 

breach by any Subservicer under its Subservicing Agreement or the failure by the Servicer to 

replace any Subservicer upon the occurrence of any such event in accordance with the terms 

governing material breach or default under the applicable Subservicing Agreement; or 

(h) any other failure (other than those specified in any of Sections 7.01(a) 

through (g)) by the Servicer duly to observe or perform in any material respect any other 

covenants or agreements on the part ofthe Servicer contained in this Agreement or to perform 

any Servicing Obligation in compliance with the Servicing Standard, and such failure continues 

unremedied for a period ofthirty (30) days, or such other period as the Company and the 

Servicer agree, after the date on which written notice ofsuch failure, requiring the same to be 

remedied, shall have been given by the Company to the Servicer; provided, however, that in the 

case of a failure that cannot be cured within thirty (30) days (or such other period as the 

Company and the Servicer agree), the cure period shall be extended for an additional thirty (30) 

days ifthe Servicer can demonstarte to the reasonable satisfaction ofthe Company that the 

Servicer is diligently pursuing remedial action. 

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FDIC FNBN CMLCON Servicing Agreement-EXECUTION VERSION 

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Section 7.02 Termination with Cause. 

(a) Upon the occurrence of any Default pursuant to this Agreement (without 

any cure period other than as may be provided for in Section 7.01 above), the Company, in 

addition to any other rights the Company may have pursuant to this Agreement, at law (including 

the Uniform Commercial Code), or in equity, including injunctive relief, specific performance or 

otherwise, may terminate this Agreement by providing a Termination Notice to the Servicer. 

(b) Upon the occurrence of a Default pursuant to any of Sections 7.0l(a), (b), 

(c), (d), (e), (f) or (h) (but with respect to a Default under clause (c), only with respect to 

Sections 5.02(t) and (g) referred to therein), or ofthis Agreement (in each case, without any cure 

period other than as may be provided for in Section 7.01 above), the Participant, in addition to 

any other rights the Participant may have at law or equity, including injunctive relief, specific 

performance or otherwise, may (i) terminate this Agreement by providing a Termination Notice 

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

notice to the Subservicers, and (iii) otherwise enforce this Agreement, in any case, without 

penalty or payment or any fee. 

(c) The Servicer hereby consents to its immediate termination under this 

Agreement by the Participant upon a Detimlt under Section 7.01(b) ofthis Agreement. 

(d) Upon a default or failure ofthe Company to perform its obligations under 

this Agreement in a material manner, including but not limited to, the failure ofthe Company to 

pay to the Servicer the Servicing Fee in full and timely, the Servicer, in addition to any other 

rights it may have pursuant to this Agreement, at law or in equity, may terminate this Agreement 

by providing a Termination Notice to the Company, with a copy to the Participant. The 

Termination Notice shall set forth with specificity the nature ofthe default or failure to perform 

ofthe Company and provide the Company with no less than thirty (30) days to cure any such 

default or failure to perform. In the event that the default or failure to perform is not cured 

within thirty (30) days from the date ofthe Termination Notice, the Servicer shall provide a 

second Termination Notice to the Company with a copy to the Participant, which second 

Termination Notice shall be prominently labeled as the "Second Termination Notice". Such 

Second Termination Notice shall confirm to the Company that the Servicer shall continue to 

perform the Servicing Obligations under this Agreement until the earlier to occur of (i) ninety 

(90) days after the delivery ofthe Second Termination Notice to the Company and the 

Participant, or (ii) the transfer of the Servicing Obligations to a successor Servicer. The duty of 

the Servicer to continue to perform the Servicing Obligations as provided in the Second 

Termination Notice is contingent upon the timely and full payment ofthe Servicing Fee to the 

Servicer during such period. Servicer shall cooperate fully and completely with the transition of 

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

Section 7.03 Termination without Cause. 

(a) The Company may at any time, without cause, terminate this Agreement, 

upon providing a Termination Notice to the Servicer, but only as and in accordance with the 

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FDIC FNBN CMLCON Servicing Agreement~ EXECUTION VERSION 

12349237.5 
provisions set forth on Schedule 5, as the same may be amended from time to time by the 

Company and the Servicer without the Participant's consent. 

(b) The Servicer may at any time after the first anniversary ofthe Effective 

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

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

Participant, a Termination Notice, which for the purpose ofthis Section 7 .03(b) shall be a notice 

of Servicer's intent to terminate this Agreement. Such Termination Notice shall be provided at 

least sixty (60) days prior to any date specified by the Servicer as the date oftermination of 

Servicer's Obligations under this Agreement. Notwithstanding the foregoing, such Termination 

Notice shall not be effective unless the Termination Notice contains confirmation ofthe intent 

and obligation of the Servicer to continue to perform its Servicing Obligations until the earlier of 

(i) ninety (90) days after the Termination Notice is given or (ii) such other date on which the 

Servicing Obligations are transferred to a successor Servicer in an orderly manner. Servicer 

shall cooperate fully and completely with the transition ofthe Servicing Obligations to a 

successor Servicer in order to assure an orderly transfer. The Servicer issuing the Termination 

Notice shall be liable for all costs associated with the transfer of Servicing Obligations to the 

successor Servicer, including but not limited to the costs of transporting the servicing files and 

the provision of any notices to Borrowers. 

Section 7.04 Effective Date. Termination as specified in this Article VII shall be 

effective at such time as is specified in the Termination Notice. In the event of such termination, 

all authority and power ofthe Servicer under this Agreement, whether with respect to the Loans 

or otherwise, shall pass to and be vested in the Company, the Participant or the successor 

servicer as designated by the Company in the case of termination by the Company, or as 

designated solely by the Participant in the case oftermination by the Participant. The Servicer 

agrees to cooperate with the Company, the Participant and such successor servicer with respect 

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

be liable for all obligations ofthe Servicer that have accrued under this Agreement or at Law 

prior to such termination. 

Section 7.05 Accounting. Upon termination ofthis Agreement as set forth herein, the 

Servicer shall account for and tum over to the Company or the Participant, or the designee of 

either, funds collected under the terms of this Agreement. The Servicer shall provide written 

notice in conformance with all applicable Law to the Borrowers to indicate that their Loans will 

henceforth be serviced by the Participant, the Company or any successor servicer designated by 

either the Participant or the Company, as the case may be, and transfer its duties as the Servicer 

to either the Participant, the Company or any successor Servicer as applicable. 

ARTICLE VIII 


INDEPENDENCE OF PARTIES; INDEMNIFICATION 


Section 8.01 Independence ofParties. The Servicer shall have the status of, and act as, 

an independent contractor. Nothing herein contained shall be construed to create a partnership or 

joint venture or any similar relationship between the Company and the Servicer. 

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FDJC FNBN CMLCON Servicing Agreement-EXECUTION VERSION 

12349237.5 
Section 8.02 Indemnification. The Servicer agrees to indemnifY, defend and hold 

harmless the Company, the Participant and each of their respective Affiliates, directors, officers, 

employees and agents and each of their respective successors and assigns (the "Indemnified 

Parties") from and against any and all claims, demands, suits, actions, proceedings, assessments, 

losses, costs, expenses (including attorneys' fees), damages and liabilities of any kind or nature 

whatsoever directly or indirectly resulting from or arising out of or related to (i) any inaccuracy 

in any of the Servicer's warranties or representations contained in this Agreement, (ii) any failure 

by the Servicer to observe or perform any or all ofthe Servicer's covenants, agreements or 

warranties contained in this Agreement, (iii) any act taken by the Servicer purportedly pursuant 

to a power of attorney granted by the Company which act results in a claim related to the 

unlawful use of such power of attorney, or (iv) failure by the Servicer or any Subservicer to 

discharge obligations on any Collateral relating to taxes, ground rents or other such recurring 

charges generally accepted by the mortgage servicing industry, which would become a Lien on 

the Collateral. The Servicer shall immediately notify the Indemnified Party if a claim is made 

with respect to this Agreement or any Loans or Collateral, assume (with prior consent of the 

Indemnified Party) the defense of any such claim and pay all expenses in cormection therewith, 

including attorneys' fees, and promptly pay, discharge and satisfy any judgment or decree which 

may be entered against it or any Indemnified Party in respect of such claim. No expenses 

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

8.02 shall constitute a Servicer Advance. The Servicer shall follow any reasonable written 

instructions received from the Indemnified Party in connection with such claims, it being 

understood that the Indemnified Party shall have no duty to monitor or give instructions with 

respect to such claims. 

Section 8.03 Procedure for Indemnification. Promptly upon receipt of written notice of 

any claim, in respect ofwhich indemnity may be sought pursuant to the terms ofthis Agreement, 

the Indemnified Party will use its best efforts to notify the Servicer in writing thereof in 

sufficient time for the Servicer to respond to such claim. Except to the extent that the Servicer is 

prejudiced thereby, the failure ofthe Indemnified Party to promptly notify the Servicer of any 

such claim shall not relieve the Servicer from any liability which it may have to the Indemnified 

Party in cormection therewith. If any claim shall be asserted or commenced against the 

Indemnified Party, the Servicer will be entitled to participate therein, and to the extent it may 

wish to assume the defense, conduct or settlement thereof, it shall be entitled to do so with 

counsel reasonably satisfactory to the Indemnified Party; provided, however, that in the event the 

Servicer fails, in the reasonable judgment ofthe Indemnified Party, vigorously to defend or 

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

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

ofthe Indemnified Party before ceasing to defend against any claim or entering into any 

settlement, adjustment or compromise ofsuch claim involving injunctive or similar equitable 

relief being imposed upon any Indemnified Party or any ofits Affiliates. After notice from the 

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

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

by the Company in connection with the defense, conduct or settlement thereof. 

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ARTICLE IX 


NOTICES 


All notices, requests, demands, and other communications required or permitted to be 

given or delivered under or by reason of the provisions ofthis Agreement shall be in writing and 

shall be given by certified or registered mail, postage prepaid, or, delivered by hand or by 

nationally recognized air courier service, directed to the address of such Person set forth below: 

If to the Company: 

with a copy to: 

If to the Participant: 

with a copy to: 

If to the Servicer: 

with a copy to: 

FNBN-CMLCON I LLC 

c/o Sorenson Group Management, LLC 

4393 Riverboat Road, Suite 450 

Salt Lake City, UT 84123 

Attention: Donald E. Wallace 

B. Ray Zoll,P.C. 

8941 South 700 East, Suite 103 

Sandy, Utah 84070 

Attention: B. Ray Zoll 

Manager, Capital Markets & Resolutions 

c/o Federal Deposit Insurance Corporation 

550 171

h Street, NW (F-7014) 

Washington, D.C. 20429-0002 

Attention: Ralph Malarni 

Senior Counsel 

FDIC Legal Division 

Litigation and Resolutions Branch, Receivership Section 

Special Issues Unit 

3501 Fairfax Drive (Room E-7056) 

Arlington, Virginia 22226 

Attention: David Gearin 

Primary Residential Mortgage, Inc. 

4750 W. Wiley Post Way, Suite 200 

Salt Lake City, UT 84116 

Attention: Kenneth Knudson 

Darryl J. Lee 

60 East South Temple, Suite 500 

Salt Lake City, UT 84111 

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FDIC FNBN CMLCON Servicing Agreement~ EXECUTION VERSION 

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Any such notice shall become effective when received (or receipt is refused) by the addressee, 

provided that any notice or communication that is received (or refused) other than during regular 

business hours ofthe recipient shall be deemed to have been given at the opening ofbusiness on 

the next Business Day of the recipient. From time to time, any Person may designate a new 

address for purposes of notice hereunder by notice to such effect to the other Persons identified 

above. 

ARTICLE X 


GOVERNING LAW; JURISDICTION 


Section 10.01 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY 

AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK 

EXCLUDING ANY CONFLICT OF LAWS RULE OR PRINCIPLE THAT MIGHT REFER 

THE GOVERNANCE OR THE CONSTRUCTION OF THIS AGREEMENT TO THE LAW 

OF ANOTHER JURISDICTION. Nothing in this Agreement shall require any unlawful action 

or inaction by any party hereto. 

Section I 0.02 Jurisdiction; Venue and Service. Each ofthe parties hereto, for itself and 

each of its Affiliates, hereby irrevocably and unconditionally: 

(a) agrees that any suit, action or proceeding instituted against it by any other 

party with respect to this Agreement may be instituted, and that any suit, action or proceeding 

instituted by it against any other party with respect to this Agreement shall be instituted, only in 

the Supreme Court ofthe State ofNew York, County ofNew York, or the U.S. District Court for 

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

Columbia (and appellate courts from any ofthe foregoing), (ii) consents and submits, for itself 

and its property, to the jurisdiction of such courts for the purpose of any such suit, action or 

proceeding instituted against it by any other party and (iii) agrees that a final judgment in any 

such suit, action or proceeding shall be conclusive and may be enforced in other jurisdictions by 

suit on the judgment or in any other manner provided by Law; 

(b) agrees that service of all writs, process and summonses in any suit, action 

or proceeding pursuant to Section 10.02(a) may be effected by the mailing of copies thereof by 

registered or certified mail, postage prepaid, to it at its address for notices pursuant to Article IX 

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

. contained in this Section 10.02(a) shall affect the ability of any party to be served process in any 

other manner permitted by Law; 

(c) (i) waives any objection that it may now or hereafter have to the laying of 

venue of any suit, action or proceeding arising out of or relating to this Agreement brought in 

any court specified in Section 10.02(a), (ii) waives any claim that any such suit, action or 

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

not to plead or claim either ofthe foregoing; and 

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FDIC FNBN CMLCON Servicing Agreement-EXECUTION VERSION 

12349237.5 
(d) agrees that nothing contained in this Section 10.02 shall be construed to 

constitute consent to jurisdiction by the Failed Bank or the FDIC, in any capacity, or a limitation 

on any removal rights the FDIC, in any capacity, may have. 

Section 10.03 Waiver ofJury Trial. EACH OF THE PARTIES HERETO, FOR ITSELF 

AND EACH OF ITS AFFILIATES, 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 AND AGREES THAT ANY 

SUCH DISPUTE SHALL BE TRIED BEFORE A JUDGE SITTING WITHOUT A JURY. 

ARTICLE XI 


MISCELLANEOUS 


Section 11.01 No Assignment by Servicer; No Transfer of Ownership Interests in 

Servicing Rights. 

(a) The Servicer hereby acknowledges that this Agreement constitutes a 

personal services agreement between the Company and the Servicer. The Servicer shall not 

assign any rights or obligations hereunder to any other Person other than as is expressly provided 

in this Agreement. Any purported sale, sub-participation or assignment or delegation in 

violation ofthis Section ll.Ol(a) shall be void ab initio and of no force or effect whatsoever. 

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

any other Person any ownership interest in the servicing ofthe Loans or any right to transfer or 

sell the servicing to the Loans (other than in connection with the sale of any Loan). The Servicer 

shall not assign, pledge or otherwise transfer or purport to assign, pledge or otherwise transfer 

any interest to any Person in the servicing ofthe Loans (other than in connection with the sale of 

any Loan). Any purported assignment, pledge, delegation or other transfer in violation ofthis 

Section ll.Ol(b) shall be void ab initio and of no force or effect whatsoever. 

Section 11.02 Legal Fees. No party to this Agreement shall be responsible for the 

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

negotiation and execution ofthis Agreement or any subsequent modifications or supplements 

hereto. 

Section 11.03 Entire Agreement. This Agreement contains the entire agreement between 

the Company and the Servicer and supersedes any and all other prior agreements, whether oral or 

written, with respect to the subject matter hereof. 

Section 11.04 Counterparts; Facsimile Signatures. This Agreement may be executed in 

two (2) or more counterparts, each of which shall be deemed an original but all of which together 

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

to the extent signed and delivered by facsimile or other electronic means, shall be treated in all 

manner and respects as an original agreement and shall be considered to have the same binding 

legal effect as ifit were the original signed version thereof delivered in person. No signatory to 

this Agreement shall raise the use of a facsimile machine or other electronic means to deliver a 

signature or the fact that any signature or agreement was transmitted or communicated through 

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FDIC FNBN CMLCON Servicing Agreement-EXECUTION VERSION 

12349237.5 
the use of a facsimile machine or other electronic means as a defense to the formation or 


enforceability of a contract and each such Person forever waives any such defense. 


Section 11.05 Headings. Paragraph titles or captions contained in this Agreement are 

inserted only as a matter of convenience and for reference and in no way define, limit, extend or 

describe the scope ofthis Agreement or the intent of any provisions hereof. All Section and 

paragraph references contained herein shall refer to Sections and paragraphs in this Agreement 

unless otherwise specified. 

Section 11.06 Construction. This Agreement shall be construed and interpreted in 

accordance with the following: 

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

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

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

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

reference specifically provides otherwise. 

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

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

replacement to such Law. 

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

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

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

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

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

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

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

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

provision of this Agreement. 

(f) The words "include" and "including" and words ofsimilar import are not 

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

they are in fact followed by such words. 

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

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

such period. 

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

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

be deemed to include the personal pronoun of the appropriate gender. 

-30­

FDIC FNBN CMLCON Servicing Agreement-EXECUTION VERSION 

12349237.5 
Section 11.07 Compliance with Law. Except as otherwise specifically provided herein, 

each party to this Agreement shall, at its own cost and expense, obey and comply with all 

applicable Laws, as they may pertain to such party's perfonnance ofits obligations hereunder. 

Section 11.08 Severability. Any provision of this Agreement which is prohibited or 

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

follows: (i) if such provision is prohibited or unenforceable in such jurisdiction only as to a 

particular Person or Persons and/or under any particular circumstance or circumstances, such 

provision shall be ineffective, but only in such jurisdiction and only with respect to such 

particular Person or Persons and/or under such particular circumstance or circumstances, as the 

case may be; (ii) without limitation of clause (i), such provision shall in any event be ineffective 

only as to such jurisdiction and only to the extent of such prohibition or unenforceability, and 

such prohibition or unenforceability in such jurisdiction shall not invalidate or render 

unenforceable such provision in any other jurisdiction; and (iii) without limitation of clauses (i) 

or (ii), such ineffectiveness shall not invalidate any of the remaining provisions ofthis 

Agreement. Without limitation ofthe 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 ofthe 

duration or scope (geographic or otherwise) of such provision, or for any other reason) such 

court shall have the power to, and shall, (x) modifY such provision (including without limitation, 

to the extent applicable, by limiting the duration or scope of such provision and/or the Persons 

against whom, and/or the circumstances under which, such provision shall be effective in such 

jurisdiction) for purposes of such proceeding to the minimum extent necessary so that such 

provision, as so modified, may then be enforced in such proceeding and (y) enforce such 

provision, as so modified pursuant to clause (x), in such proceeding. Nothing in this Section is 

intended to, or shall, limit (I) the ability of any party to this Agreement to appeal any court 

ruling or the effect of any favorable ruling on appeal or (2) the intended effect of Section 10.01. 

Section 11.09 Third Party Beneficiary. The Participant shall be and is hereby designated 

as a third party beneficiary under this Agreement and, as such, the Participant is entitled to 

enforce this Agreement as if the Participant were a party hereto. Notwithstanding the foregoing 

the Participant shall have no obligation to undertake any of the duties of the Company hereunder 

and shall have no liability whatsoever to the Servicer, any Subservicer or any other party related 

to this Agreement. There shall be no other third party beneficiaries. 

Section 11.10 Protection of Confidential Information. The Servicer shall keep 

confidential and shall not divulge to any party, without the Company's prior written consent, any 

information pertaining to the Participation Agreement, the Loans or any Borrower or the 

Collateral thereunder, except as required pursuant to this Agreement and except to the extent that 

it is necessary and appropriate for the Servicer to do so in working with legal counsel, auditors, 

taxing authorities, regulatory authorities or other Governmental Authority or in accordance with 

the Servicing Standard. 

Section 11.11 Time of Essence. Time is hereby declared to be ofthe essence ofthis 

Agreement and of every part hereof 

- 31 ­ FDIC FNBN CMLCON Servicing Agreement-EXECUTION VERSION 

12349237.5 
Section 11.12 No Presumption. This Agreement shall be construed fairly as to each 

party hereto and if at any time any such term or condition is desired or required to be interpreted 

'or construed, no consideration shall be given to the issue of who actually prepared, drafted or 

requested any term or condition of this Agreement or any agreement or instrument subject 

hereto. 

Section 11.13 No Right of Setoff. The Servicer hereby waives any and all rights it may 

otherwise have (whether by contract or operation of Law or otherwise) to any setoff, offset, 

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

deduction) against the Loan Proceeds. 

Section 11.14 Release of Participant and Prior Servicers. The Servicer hereby releases 

and discharges the Participant and any predecessor servicer, and all oftheir respective officers, 

directors, employees, agents, attorneys, contractors and representatives, and all oftheir 

respective successors and assigns (other than the Company) and Affiliates, from any and all 

claims (including any counterclaim or defensive claim), demands, causes of action, judgments or 

legal proceedings and remedies of whatever kind or nature that the Servicer had, has or might 

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

that servicing ofthe Loans or Collateral by the Participant or such other predecessor servicer 

prior to the Servicing Transfer Date (other than due to gross negligence or willful misconduct of 

the Participant or other predeccessor servicer). 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 

-32­

FDIC FNBN CMLCON Servicing Agreement-EXECUTION VERSION 

12349237.5 
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed 

as of the day and year first above written. 

COMPANY: 

FNBN-CMLCON I LLC 

By: SGH FNB Ventures, LLC, a Delaware 

limited liability company, Sole Member and 

Manager 

By: Sorenson Group Management, LLC, a 

Delaware limited liability company, its 

Nam

Title: Manager 

SERVICER: 

PRIMARY RESIDENTIAL MORTGAGE, INC. 

By:________________ 

Name: Kenneth C. Knudson 

Title: Vice President - Finance 

-33­

FDIC FNBN CMLCON Servicing Agreement-EXECUTION VERSION 

12349237.5 
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed 

as of the day and year first above written. 

COMPANY: 

--------------------~,LLC 

By:______________ 


Name: 


Title: 


SERVICER: 


- 31 ­
EXHIBIT A 


LOAN SCHEDULE 


[Attached] 

See Tab22 

FDIC FNBN CMLCON Servicing Agreement- EXECUTION VERSION 

12349237.5 
SCHEDULE! 


FEE SCHEDULE 


PROGRAM S:ET-UP FEE: 


A loan underwriting conditional analysis review of $450 per loan and $95 per loan initial 

setup fee will be charged by Servicer to review the loan file servicing and other 

underwriting conditions ofthe loans and to setup the loan on the Servicer loan servicing 

system. In addition, for all loans that do not have a valid tax service contract or which 

require updated UCC filing research, Company will reimburse Servicer for the purchase 

of a tax service contract and/or any UCC filing research necessary to setup the initial loan 

and provide for the ongoing servicing ofthe same. Reimbursement of all legal costs 

associated with negotiating and closing the servicing agreement is not included in this fee 

and will be an additional expense. 

LOAN SERVICING FEES: 

$95 per~erforming loan per month 


$250 per month for all delinquent and defaulted loans past due greater than sixty (60) 


days delinquent. 


' 

I 

LOT RELEASE FEE: 

' 

$!50 per release request processed, plus Servicer's actual out-of-pocket expenses. 

ADDmONAL FUNDINGS PROCESSING FEE: 

$1,750 per funding request processed, plus Servicer's actual out-of-pocket expenses 

including third-party property inspection services, title date-down services, title lien resolution 

and recording f~es, etc. 

ASSIGNMENT OF LOAN DOCUMENTS: 

$100 pet assignment, plus Servicer's actual out-of-pocket expenses 

PROPERTY I1'<SPECTIONS: 

Servicer will bill all inspection costs back to the borrower or Company under a separate 

billing statement on a "cost plus 30%" basis. 
SCHEDULE2 


SERVICING OBLIGATIONS 


Company Duties: 

Administration 


REO Management and Disposition 


Mai)age LIP Draws and Inspections 


Direct pursuance of governmental guaranties 


Mru)age Defaults/Foreclosures 


Mru)age Litigation 


Servicer Dutie8: 

Loab administration 

Loan accounting and reporting 

A.RM administration 

Tax; insurance and UCC administration- consisting of an annual review and 

confirmation ofthe status oftaxes paid and insurance coverage requirements 

Escr.ow and reserve administration (to the extent necessary) 

Routine customer service 

Annual fmaucial statement collection, review and analysis (as required by individual 

loans) 

Property site inspections (to the extent requested) 

Loan document assignments (to the extent requested) 

Remittances to Company and participants once per month 

Lot 1-eleases 

Funding draw requests - Servicer will review all funding draw requests, provide a 

recommendation to Company for all required construction disbursements 

Manage custodial accounts (LIP Account, Liquidity Reserve Account, Litigation 

Reserve Account) 

' 
SCHEDULE3 

REIMBURSEMENT OF SERVICER ADVANCES 

To the extent that Servicer shall make Servicing Advances, Company shall reimburse 

such Servicing Advances to Servicer no later than the lO'h day of the month following 

such advance, together with interest from the date of the Servicing Advances to the 

date ofreimbursement of same, such interest to accrue at the rate of U.S. Bank, NA 

Prime Rate of Interest plus Three Percent, provided that in no event shall the interest 

rate be less than ten percent (I 0%) per annum. 

Version 02/20/2009 
POSTED/1-13-09 

SCHEDULE4 


FORM OF ELECTRONIC REPORT ON THE LOANS AND COLLATERAL 


[To be provided by Servicer and Company) 

FNa COMMCONSTR!>ERV AO.DOC 

12345427.1 
Reporting Requirements 

Data File from servicing system to be provided in Excel 

(or such other data fields that Participant may request related to Company assets 

utilizing sys~ems maintained by Servicer or any Subservicer) 

Data Fields Required by property 

Loan Number 

2nd Loan Number 

Combined Loan Amount 

I st Loan Arrit 

2nd Loan Amt 

Combined UPB or Disb Amt 

1st Loan UPB or Disb 

2nd Ln UPB or Disb Amt 

Original Rat~ 

Current Rate 

Terrn 

Note 

CPMod 

1st Due 

Next Due 

Maturity 

Margin 

Index 

Street 

City 

ST 

ZIP 

Original ApJiraisal 

Lien ' 

Credit Score' 

CoBwr Score 

Units 

Prop Class 

Purp Type 

Occ 

Documentation 

lnt Only , 

Int Only En~ 

PMI Cert 1

Basis 

PI Pyrnt 

TIPymt 

2ndT&IBaJ' 

TI Balance 

D-7 

FNB CommConstr;Pt~.r! & Scrv Ag.DOC 
Last CP lnsp 

CP%Comp 

coo 

BPO Date 

BPO Value As Is 

BPO Valtte l).epair or Complete 

BPO Prop Condition 

Last Dlq Insp 

Inspection Type 

lnsp Order 

Inspection Comments 

Updated Score 

Type 

Prod 

Product Description 

1st Mtg Loan 

Builder 

SqFt 

Int Type 

Inv 

Grp 

PC 

Consun1er In~licator 

Bankruptcy J:Jate 

D-8 

FNB CommConstr ~nrt & Serv Ag.DOC 
SCHEDULES 


TERMINATION WITHOUT CAUSE 


This Agreement may be terminated by Company, without cause, upon thiny (30) days 

written notice to the Servicer. Termination of this Agreement shall be without prejudice to any 

rights of the Company or the Servicer, which may have accrued through the date of 

termination hereunder. Upon such termination, the Servicer shall (i) remit all funds in the 

Collection Account, the LIP Account, Escrow Accounts and Other Accounts to the Company 

or such other Person designated by the Company, net of accrued Servicing Fees, Servicer 

Advances or Servicing Expenses through the termination date to which the Servicer would be 

entitled to payment or reimbursement hereunder; (ii) deliver all related Loan Documents to the 

Company or to Persons designated by the Company; and (iii) fully cooperate with the 

Company and any new servicer to effectuate an orderly transition of Loan Servicing of the 

related Loans. Upon such termination, any Servicing Fees, Servicer Advances or Servicing 

Expenses (with interest thereon at the Advance Rate) which remain unpaid or unreimbursed 

after the Servicer has netted out such amounts pursuant to the preceding sentence shall be 

remitted by the Company to the Servicer within ten (10) Business Days after the Company's 

receipt of an itemized invoice therefor. 

With respect to a termination of this Agreement by the Company without cause as to 

any or all of the Loans, the Company shall pay to Servicer within ten (10) Business Days after 

the effective date of such termination a termination fee per loan equal to the greater of i) the 

amount equal to the sum Servicer received as a Servicer Fee in the sixty days prior to the date 

of Termination, or ii) $475 per loan. 

Version 02/20/2009