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spirit20181amendmentno3t

                                                               Execution Version           AMENDMENT NO. 3 TO THE SECOND AMENDED AND RESTATED             PROPERTY MANAGEMENT AND SERVICING AGREEMENT          This Amendment No. 3 to the Second Amended and Restated Property Management and   Servicing Agreement (this “Amendment”), is entered into as of this 1st day of November, 2018,   by and among Spirit Master Funding, LLC, Spirit Master Funding II, LLC, Spirit Master Funding   III, LLC, Spirit Master Funding VI, LLC and Spirit Master Funding VIII, LLC, each as an issuer   (each, an “Issuer” and, collectively, the “Issuers”), Spirit Realty, L.P. (“Spirit Realty”), as   property manager and special servicer (together with its successors in such capacities, the   “Property Manager” and “Special Servicer,” respectively), Midland Loan Services, a division   of PNC Bank, National Association, as Back-Up Manager (together with its successors in such  capacity, the “Back-Up Manager”).                                    WITNESSETH:          WHEREAS, the Issuers, the Property Manager, the Special Servicer and the Back-Up   Manager entered into that certain Second Amended and Restated Property Management and   Servicing Agreement, dated as of May 20, 2014 (as amended by Amendment No. 1 thereto, dated   as of November 26, 2014 and Amendment No. 2 thereto, dated as of December 14, 2017, the   “Property Management Agreement”);          WHEREAS, Article VIII of the Second Amended and Restated Master Indenture, dated as   of May 20, 2014, as amended by Amendment No. 1 thereto, dated as of November 26, 2014,   Amendment No. 2 thereto, dated as of December 14, 2017, Amendment No. 3 thereto, dated as of   January 29, 2018 and Amendment No. 4 thereto, dated as of the date hereof (as so amended, the   “Master Indenture”), among the Issuers and the Indenture Trustee, and Section 9.01 of the   Property Management Agreement permit amendments to the Property Management Agreement   subject to certain conditions set forth therein;          WHEREAS, the Issuers have entered into that certain Series 2018-1 Supplement to the   Master Indenture related to the issuance by the Issuers of $50,000,000 Net-Lease Mortgage   Notes, Series 2018-1, Class A (the  “Series 2018-1 Notes”) on the date hereof (the “Series 2018-  1 Notes Issuance”), which constitutes a New Issuance (as defined in the Master Indenture);                  WHEREAS,  Section 8.04 of the Master Indenture authorizes the Issuers and the other  parties thereto to amend, modify or supplement any of the Transaction Documents, including the   Property Management Agreement, without the consent of the Noteholders, in connection with any   New Issuance, including the Series 2018-1 Notes Issuance; provided that consent of holders of   100% of the Aggregate Series Principal Balance affected by such amendment, modification or   supplement is required if the related amendments, modifications or supplements to such  Transaction Document is set forth in Section 8.04(a)(1)-(7) of the Master Indenture;         WHEREAS, the parties hereto desire, in accordance with Article VIII of the Master  Indenture and Section 9.01 of the Property Management Agreement, to amend the Property  Management Agreement as provided herein, which amendments, modifications and supplements  are not enumerated in Section 8.04(a)(1)-(7) of the Master Indenture; and         US-DOCS\102978699.3  

 

      NOW, THEREFORE, based upon the mutual promises and agreements contained herein,  and for other good and valuable consideration, the receipt and sufficiency of which are hereby  acknowledged, the undersigned, intending to be legally bound, hereby agree as follows:                                  AGREEMENTS         1.    Defined Terms.  All capitalized terms not otherwise defined herein shall have the  meanings assigned thereto in the Property Management Agreement and if not defined therein, shall  have the meaning assigned thereto in the Master Indenture.         2.    Amendments to the Property Management Agreement. As of the date hereof, the  Property Management Agreement is hereby amended to delete the stricken text (indicated textually  in the same manner as the following example: stricken text) and to add the bold and double- underlined text (indicated textually in the same manner as the following example: bold and  double-underlined text) as set forth on the pages of the Property Management Agreement  attached as Exhibit A hereto (the “Amended Property Management Agreement”).         3.    Reference to and Effect on the Property Management Agreement; Ratification.         (a)   Except as specifically amended above, the Property Management Agreement is and  shall continue to be in full force and effect and is hereby ratified and confirmed in all respects.         (b)   Except as expressly set forth above, the execution, delivery and effectiveness of   this Amendment shall not operate as a waiver of any right, power or remedy of any party hereto   under the Master Indenture or the Property Management Agreement, or constitute a waiver of   any provision of any other agreement.         (c)   Upon the effectiveness hereof, each reference in the Property Management to “this   Agreement”, “Property Management Agreement”, “Second Amended and Restated Property   Management and Servicing Agreement”, “hereto”, “hereunder”, “hereof” or words of like   import referring to the Property Management Agreement, and each reference in any other   Transaction Document to “Property Management Agreement”, “Second Amended and Restated   Property Management Agreement”, “thereto”, “thereof”, “thereunder” or words of like import   referring to the Property Management Agreement shall mean and be a reference to the Property   Management Agreement as amended hereby.         4.    Effectiveness. This Amendment shall be effective upon delivery of executed  signature pages by all parties hereto. The parties hereto agree and acknowledge that the  amendments, modifications set forth herein are being made in connection with a New Issuance  and that the related amendments, modifications and supplements are not of the type described in  Section 8.04(a)(1)-(7) of the Master Indenture.         5.    Counterparts; Facsimile Signature. This Amendment may be executed  simultaneously in any number of counterparts, each of which shall be deemed to be an original,  and all such counterparts shall constitute but one and the same instrument. Delivery of an executed  counterpart of a signature page of this Amendment in Portable Document Format (PDF) or by  facsimile transmission shall be as effective as delivery of a manually executed original counterpart  of this Amendment.                                         2  US-DOCS\102978699.3  

 

      6.    Governing Law.  THIS AMENDMENT SHALL BE CONSTRUED IN  ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE                OF NEW YORK  APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE  (WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES), AND THE  OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL  BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.         7.    Headings.  The descriptive headings of the various sections of this Amendment are  inserted for convenience of reference only and shall not be deemed to affect the meaning or  construction of any of the provisions thereof.         8.    Severability.  The failure or unenforceability of any provision hereof shall not affect  the other provisions of this Amendment. Whenever possible each provision of this Amendment  shall be interpreted in such manner as to be effective and valid under applicable law, but if any  provision of this Amendment shall be prohibited by or invalid under applicable law, such provision  shall be ineffective to the extent of such prohibition or invalidity, without invalidating the  remainder of such provision or the remaining provisions of this Amendment.         9.    Interpretation.  Whenever the context and construction so require, all words used  in the singular number herein shall be deemed to have been used in the plural, and vice versa, and  the masculine gender shall include the feminine and neuter and the neuter shall include the  masculine and feminine.                  [Remainder of Page Intentionally Blank; Signature Pages Follow]                                         3  US-DOCS\102978699.3  

 

           IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be  duly executed by their respective officers or representatives all as of the day and year first above  written.                                      SPIRIT MASTER FUNDING, LLC, as Issuer                                      By: SMTA SPE Manager, LLC, a Delaware limited                                        liability company                                     Its: Manager                                      By: ------F--lf------­                                       Name:  Ricardo Rodriguez                                        Title: Authorized Signatory                                      SPIRIT MASTER FUNDING II, LLC, as Issuer                                      By: SMTA SPE Manager, LLC, a Delaware limited                                        liability company                                     Its: Manager                                      By: ____<".....: =====~,;2::f!=~ =-------                                       Name:  Ricardo~guez                                        Title: Authorized Signatory                                      SPIRIT MASTER FUNDING III, LLC, as Issuer                                      By: SMTA SPE Manager, LLC, a Delaware limited                                        liability company                                     Its: Manager                                      By:                                        Name:  Ricardo f odriguez                                        Title: Authorized Signatory    [Amendment No. 3 to the Second Amended and Restated Property Management and Sen,icing Agreement]  

 

                                   SPIRIT MASTER FUNDING VI,  LLC, as Issuer                                      By: SMTA SPE Manager, LLC, a Delaware limited                                        liability company                                     Its: Manager                                       B~ N~ ~- e-: -~~~-fil~~~R- o-~- -~- e_z ___                                         Title: Authorized Signatory                                      SPIRIT MASTER FUNDING VIII, LLC, as Issuer                                      By: SMTA  SPE Manager, LLC, a Delaware limited                                        liability company                                     Its: Manager                                       By: -----11:/:,=l=--...:::;._-----                                       N~e:                                        Title:    [Amendment No. 3 to the Second Amended and Restated Property Management and Servicing Agreement]  

 

                                   SPIRIT REALTY, L.P.                                     By: Spirit General OP Holdings, LLC, a Delaware                                     limited liability company                                     lffi: Gen~     ~c                                     ;--?~----                                       Name: Michael Hughes                                        Title: Executive Vice President, Chief                                             Financial Officer and Treasurer    [Amendment No. 3 to the Second Amended and Restated Property Management and Servicing Agreement]  

 

                                    MIDLAND LOAN SERVICES, A                                      DIVISION OF PNC BANK, NATIONAL                                      ASSOCIATION, as Back-Up Manager                                        By:    C/J;:.,t c. -tEz__                                          Name:  David A Eckels                                          Title: Senior Vice President    [Amendment No. 3 to the Second Amended and Restated Property Management and Servicing Agreement]  

 

                                                                                                                  EXHIBIT A                                                                Amended Property Management Agreement                                                                            [See attached.]      US-DOCS\102978699.3  

 

                                Conformed Copy of Property Management Agreement         (reflects updates pursuant to Amendment No. 13 dated as of November 26 1, 2014 2018)                              and Amendment No. 2 dated as of December 14, 2017)    SPIRIT MASTER FUNDING, LLC, SPIRIT MASTER FUNDING II, LLC AND SPIRIT                         MASTER FUNDING III, LLC                                each, as Issuer,                                     and                            EACH JOINING PARTY                               each, as Issuer,                             SPIRIT REALTY, L.P.                    as Property Manager and Special Servicer and        MIDLAND LOAN SERVICES, A DIVISION OF PNC BANK, NATIONAL                               ASSOCIATION                             as Back-Up Manager        SECOND AMENDED AND RESTATED PROPERTY MANAGEMENT AND                          SERVICING AGREEMENT                            Dated as of May 20, 2014                             Net-Lease Mortgage Notes   US-DOCS\ 96557504.7 102826315.7 

 

                          TABLE OF CONTENTS                                                                      Page  Article I DEFINITIONS                                                 1        Section 1.01 Defined Terms                                      1       Section 1.02 Other Definitional Provisions                     32       Section 1.03 Certain Calculations in Respect of the Leases and the Mortgage                  Loans                                               33       Section 1.04 Fee Calculations; Interest Calculations           34  Article II REPRESENTATIONS AND WARRANTIES; RECORDINGS AND       FILINGS; BOOKS AND RECORDS; DEFECT, BREACH, CURE,       REPURCHASE AND SUBSTITUTION; FINANCIAL COVENANTS               35        Section 2.01 Representations and Warranties of the Property Manager and the                  Back-Up Manager                                     35       Section 2.02 Representations and Warranties of the Issuers     38       Section 2.03 Recordings and Filings; Books and Records         39       Section 2.04 Repurchase or Transfer for Collateral Defects and Breaches of                  Representations and Warranties                      41       Section 2.05 Non-Petition                                      43  Article III ADMINISTRATION AND SERVICING OF MORTGAGED PROPERTIES       AND LEASES                                                     44        Section 3.01 Administration of the Mortgaged Properties, Leases and Mortgage                  Loans                                               44       Section 3.02 Collection of Lease Payments and Loan Payments; Lockbox                  Accounts; Lockbox Transfer Accounts                 45       Section 3.03 Collection of Real Estate Taxes and Insurance Premiums; Servicing                  Accounts; Property Protection Advances; P&I Advances;                  Emergency Property Expenses                         46       Section 3.04 Collection Account; Release Account; Exchange Reserve Account 52       Section 3.05 Withdrawals From the Collection Account and the Release Account 54       Section 3.06 Investment of Funds in the Collection Account and the Release                  Account                                             55       Section 3.07 Maintenance of Insurance Policies; Errors and Omissions and Fidelity                  Coverage                                            57       Section 3.08 Enforcement of Alienation Clauses; Consent to Assignment 60       Section 3.09 Realization Upon Specially Serviced Assets.       60       Section 3.10 Issuers, Custodian and Indenture Trustee to Cooperate; Release of                  Lease Files and Loan Files                          63       Section 3.11 Servicing Compensation; Interest on Property Protection Advances 65       Section 3.12 Property Inspections; Collection of Financial Statements; Delivery of                  Certain Reports                                     68                                      i US-DOCS\ 96557504.7 102826315.7 

 

      Section 3.13 Annual Statement as to Compliance                 69       Section 3.14 Reports by Independent Public Accountants.        69       Section 3.15 Access to Certain Information; Delivery of Certain Information 69       Section 3.16 Title to REO Property                             70       Section 3.17 Management of REO Properties and Mortgaged Properties relating                  to Defaulted Assets                                 70       Section 3.18 Sale and Exchange of Mortgage Loans, Leases and Mortgaged                  Properties                                          71       Section 3.19 Modifications, Waivers, Amendments and Consents.  72       Section 3.20 Transfer of Servicing Between Property Manager and Special                  Servicer; Record Keeping                            73       Section 3.21 Sub-Management Agreements                         74  Article IV REPORTS                                                   76        Section 4.01 Reports to the Issuers, the Indenture Trustee and the Insurers 76       Section 4.02 Use of Agents                                     77  Article V THE PROPERTY MANAGER AND THE SPECIAL SERVICER              78        Section 5.01 Liability of the Property Manager and the Special Servicer 78       Section 5.02 Merger, Consolidation or Conversion of the Property Manager and                  the Special Servicer                                78       Section 5.03 Limitation on Liability of the Property Manager, the Special Servicer                  and the Back-Up Manager; Environmental Liabilities  78       Section 5.04 Term of Service; Property Manager and Special Servicer Not to                  Resign                                              79       Section 5.05 Rights of Certain Persons in Respect of the Property Manager and the                  Special Servicer                                    80       Section 5.06 [Reserved]                                        81       Section 5.07 Property Manager or Special Servicer as Owner of Notes 81  Article VI SERVICER REPLACEMENT EVENTS                               81        Section 6.01 Servicer Replacement Events                       81       Section 6.02 Successor Property Manager                        86       Section 6.03 Additional Remedies of the Issuers and the Indenture Trustee upon a                  Servicer Replacement Event                          88       Section 6.04 Replacement of the Servicer.                      88  Article VII TRANSFERS AND EXCHANGES OF MORTGAGED PROPERTIES AND       MORTGAGE LOANS BY THE APPLICABLE ISSUERS; RELEASE OF       MORTGAGED PROPERTIES AND MORTGAGE LOANS BY THE       APPLICABLE ISSUERS.                                            89        Section 7.01 Released Mortgage Loans and Released Mortgaged Properties 89                                      ii US-DOCS\ 96557504.7 102826315.7 

 

      Section 7.02 Third Party Purchase Options; Release of Mortgaged Properties to                  Affiliates under Defaulted or Delinquent Assets; Early Refinancing                  Prepayment; Other Sales or Exchanges                94       Section 7.03 Transfer of Lease to New Mortgaged Property.      95       Section 7.04 Criteria Applicable to all Mortgage Properties and Mortgage Loans                  included in the Collateral Pool                     96       Section 7.05 Restrictions on Environmental Condition Mortgaged Properties 96       Section 7.06 Terminated Lease Property.                        96  Article VIII TERMINATION                                             97        Section 8.01 Termination Upon Repurchase or Liquidation of All Mortgaged                  Properties or Discharge of Indenture                97  Article IX MISCELLANEOUS PROVISIONS                                  97        Section 9.01 Amendment.                                        97       Section 9.02 Counterparts.                                     97       Section 9.03 GOVERNING LAW                                     97       Section 9.04 Notices                                           98       Section 9.05 Severability of Provisions                        99       Section 9.06 Effect of Headings and Table of Contents          99       Section 9.07 Notices to Rating Agencies                        99       Section 9.08 Successors and Assigns: Beneficiaries            100       Section 9.09 Complete Agreement                               100       Section 9.10 [Reserved].                                      100       Section 9.11 Consent to Jurisdiction                          100       Section 9.12 No Proceedings                                   100                                      iii US-DOCS\ 96557504.7 102826315.7 

 

                               EXHIBITS  EXHIBIT A-1    MORTGAGED PROPERTY SCHEDULE  EXHIBIT A-2    MORTGAGE LOAN SCHEDULE  EXHIBIT B      FORM OF REQUEST FOR RELEASE — PROPERTY MANAGER  EXHIBIT C      FORM OF REQUEST FOR RELEASE — SPECIAL SERVICER  EXHIBIT D      FORM OF LIMITED POWERS OF ATTORNEY FROM ISSUER OR                INDENTURE TRUSTEE  EXHIBIT E      CALCULATION OF FIXED CHARGE COVERAGE RATIOS  EXHIBIT F      FORM OF DETERMINATION DATE REPORT  EXHIBIT G      FORM OF JOINDER AGREEMENT  EXHIBIT H      INDENTURE                                      iv US-DOCS\ 96557504.7 102826315.7 

 

      This SECOND AMENDED AND RESTATED PROPERTY MANAGEMENT AND SERVICING AGREEMENT, dated as of May 20, 2014 (as amended, modified or otherwise modified, the “ Agreement ”), is made among Spirit Master Funding, LLC, Spirit Master Funding II, LLC, Spirit Master Funding III, LLC, and each Joining Party, each as an issuer (each, an “Issuer ” and, collectively, the “ Issuers ”), Spirit Realty, L.P. (“ Spirit Realty ”), as property manager and special servicer (together with its successors in such capacities, the “ Property Manager ” and “ Special Servicer ,” respectively), and Midland Loan Services, a division of PNC Bank, National Association, as Back-Up Manager (together with its successors in such capacity, the “ Back-Up Manager ”).                          PRELIMINARY STATEMENT        As of the Applicable Series Closing Date, the Issuers own the Mortgaged Properties and related Leases as indicated on Exhibit A-1  and the Mortgage Loans as indicated on Exhibit A-2 and each Issuer has pledged such Mortgaged Properties, Leases and Mortgage Loans owned by it to the Indenture Trustee as security for the indebtedness evidenced by the Indenture and each Series of Notes issued under the Indenture. Spirit Realty has agreed to provide property management services with respect to the Mortgaged Properties and to service the Leases and the Mortgage Loans as set forth herein.                                   ARTICLE I                                DEFINITIONS        Section 1.01 Defined Terms .        Whenever used in this Agreement, including in the Preliminary Statement, the words and phrases set forth below, unless the context otherwise requires, shall have the meanings specified in this Section 1.01 . Capitalized terms used in this Agreement, including the Preliminary Statement, and not defined herein, unless the context otherwise requires, shall have the respective meanings specified in Section 1.01 of the Indenture (as defined below).        “30/360 Basis ”: The accrual of interest calculated on the basis of a 360-day year consisting of twelve 30-day months.        “Account Control Agreement ”: An agreement with respect to a deposit account or a securities account, in form and substance satisfactory to the Indenture Trustee, pursuant to which the institution at which such account is maintained agrees to follow the instructions or entitlement orders, as the case may be, of the Indenture Trustee with respect thereto.        “Additional Rent ”: With respect to any Lease, in addition to fixed rent or base rent thereunder, rent, if any, calculated as a percentage of the total sales generated by the related Tenant at the related Mortgaged Property.                                      1 US-DOCS\ 96557504.7 102826315.7 

 

      “Additional Servicing Compensation ”: Property Manager Additional Servicing Compensation and/or Special Servicer Additional Servicing Compensation, as the context may require.        “Advance ”: Any Property Protection Advance and/or P&I Advance, as the context may require.        “Advance Interest ”: Interest accrued on any unreimbursed Advance at the Reimbursement Rate and payable to the Property Manager, Indenture Trustee or the Back-Up Manager, as the case may be, in accordance with the terms hereof.        “Aggregate Collateral Value ”: As defined in the Indenture.        “Aggregate Collateral Value of Post-Closing Properties ”: Unless otherwise specified  in the applicable Series Supplement, $282,440,000.        “Aggregate Note Principal Balance ”: As defined in the Indenture.        “Aggregate Series Principal Balance ”: As defined in the Indenture.        “Allocated Loan Amount ”: For any Mortgage Loan or Mortgaged Property (that does  not otherwise secure a Mortgage Loan) as of any date of determination, the product of (i) the  Aggregate Series Principal Balance and (ii) a fraction, (a) the numerator of which is the  Collateral Value of such Mortgage Loan or Mortgaged Property, as applicable and (b) the  denominator of which is the Aggregate Collateral Value.         “ Applicable Series Closing Date ”: May 20, 2014.        “Appraised Value ”:  (X) For any Mortgaged Property included (or to be included) in the Collateral Pool or securing a Mortgage Loan included (or to be included) in the Collateral Pool other than an Equipment Loan, an appraised value determined pursuant to an independent MAI appraisal in accordance with the Uniform Standards of Professional Appraisal Practice (as recognized by the Financial Institutions Reform, Recovery and Enforcement Act of 1989) and which takes into account the leased fee value of the related buildings and land of such Mortgaged Property, consistent with industry standards, and excludes the value of equipment and other tangible personal property and business enterprise value, and (1) with respect to any Mortgage Loan (other than an Equipment Loan) included in the Collateral Pool as of a Series Closing Date (including the Applicable Series Closing Date), is the most recent full narrative (complete summary) or limited scope (limited restricted) MAI appraisal obtained by the Property Manager with respect to the related Mortgaged Property, (2) with respect to any Mortgaged Property included in the Collateral Pool as of a Series Closing Date (including the Applicable Series Closing Date), is the most recent full narrative (complete summary) or limited scope (limited restricted) MAI appraisal obtained by the Property Manager with respect to such Mortgaged Property or (3) with respect to any Qualified Substitute Mortgage Loan or Qualified Substitute Mortgaged Property added (or to be added) to the Collateral Pool since the most recent Series Closing Date (including the Applicable Series Closing Date), is either (a) a full narrative (complete summary) MAI appraisal or (b) with respect to a related Mortgaged Property operated within the Restaurant/Casual Dining Business Sector (as defined in the Indenture), a                                     2 US-DOCS\ 96557504.7 102826315.7 

 

limited scope (limited restricted) MAI appraisal obtained within 12 months prior to the date such Qualified Substitute Mortgage Loan or Qualified Substitute Mortgaged Property is pledged as part of the Collateral Pool; provided , that, in the event that, at any time subsequent to a Series Closing Date, in accordance with the Servicing Standard, the Property Manager or Special Servicer determines that obtaining a new Appraised Value is necessary, a full narrative (complete summary) or, with respect to a related Mortgaged Property operated within the Restaurant/Quick Service Business Sector, limited scope (limited restricted) MAI appraisal obtained by the Property Manager or the Special Servicer with respect to such Mortgaged Property or (Y) for any Equipment Loan included or to be included in the Collateral Pool, as specified in the most recent Series Supplement.        “Asset File ”: A Loan File or a Lease File, as the context requires.        “Assignment of Leases ”: With respect to any Mortgage Loan, any assignment of leases, rents and profits or similar document or instrument executed by the Borrower in connection with the origination or subsequent modification or amendment of the related Mortgage Loan.        “Authorized Officer ”: With respect to an Issuer, any person who is authorized to act for such Issuer and who is identified on the list delivered by such Issuer to the Indenture Trustee on each Series Closing Date (as such list may be modified or supplemented from time to time thereafter by the Issuer).        “Available Amount ”: The Available Amount for any Payment Date will consist of the aggregate of all amounts received in respect of the Collateral Pool during the immediately preceding Collection Period and on deposit in the Collection Account on the immediately preceding Determination Date, including amounts earned, if any, on the investment of such funds on deposit in the Collection Account  and , the Release Account and the Exchange Reserve Account  during the immediately preceding Collection Period, Unscheduled Proceeds, amounts received on account of payments under any Guaranties, and any amounts received on account of payments under the Performance Undertakings and the Environmental Indemnity Agreements, any amounts released from the Liquidity Reserve Account to be treated as Available Amounts in accordance with the Indenture on such Payment Date, and any amounts released from the Cashflow Coverage Reserve Account to be treated as Available Amounts in accordance with the Indenture on such Payment Date and any other amounts deposited in the Payment Account in order to be applied as Available Amounts on such Payment Date, but excluding (i) amounts on deposit in the Release Account and not transferred to the Collection Account for such Payment Date, (ii) the amount of any collections allocated to Companion Loans, if any, as provided in the applicable Pari Passu Co-Lender Agreements, (iii) the amount of any Additional Servicing Compensation, (iv) amounts received on account of Excess Cashflow (so long as no Early Amortization Event or Sweep Period has occurred and is continuing), (v) amounts withdrawn from the Collection Account to reimburse the Property Manager, the Back-Up Manager or the Indenture Trustee, as applicable, for any unreimbursed Advances (plus interest thereon) and to pay the Property Management Fee, the Back-Up Fee, any Special Servicing Fee, Workout Fees or Liquidation Fees and any Emergency Property Expenses, (vi) amounts required to be paid by any Issuer as the lessor under the related Leases in respect of sales taxes, (vii) Third Party Option Expenses, (viii) any amount received from a Tenant or Borrower as reimbursement for any cost paid by or on behalf of any Issuer as lessor or lender under a related Lease or Mortgage Loan, as                                     3 US-DOCS\ 96557504.7 102826315.7 

 

applicable, and (ix) any amounts collected by or on behalf of any Issuer as lender or lessor and held in escrow or impound to pay future obligations due under a Mortgage Loan or Lease, as applicable.  For the avoidance of doubt, proceeds of draws under Variable Funding Notes shall not constitute Available Amounts.        “Average Cashflow Coverage Ratio ”: With respect to any Determination Date, the average of the Cashflow Coverage Ratios for such Determination Date and each of the two immediately preceding Determination Dates; provided, however, that the Average Cashflow Ratio shall not be calculated until the third Determination Date following the Applicable Series Closing Date.        “Back-Up Fee ”: With respect to each Mortgage Loan and each Mortgaged Property (that does not otherwise secure a Mortgage Loan), the fee payable to the Back-Up Manager pursuant to Section 3.11(h) .        “Back-Up Fee Rate ”: With respect to each Mortgage Loan and each Mortgaged Property, a fixed percentage rate equal to 0.0100% per annum.        “Back-Up Manager ”: Midland Loan Services, a division of PNC Bank, National Association, a Delaware corporation, or its successor in interest.        “Balloon Loan ”: Mortgage Loans which have substantial payments of principal (relative to the initial principal balance of such Mortgage Loan) due at their stated maturities.        “Bankruptcy Code ”: The federal Bankruptcy Code of 1978, Title 11 of the United States Code, as amended from time to time.        “Borrower ”: For any Mortgage Loan, the obligor or obligors on the related Mortgage Note, including any Person that has acquired the related collateral and assumed the obligations of the original obligor or obligors under such Mortgage Note.        “Business Day ”: Any day other than a Saturday, a Sunday or a day on which banking institutions are authorized or obligated by law or executive order to remain closed in New York, New York, Scottsdale, Arizona, or any other city in which is located the principal office of an Issuer, the Primary Servicing Office of the Property Manager or the Special Servicer or the Indenture Trustee’s office.        “Cashflow Coverage Ratio ”: With respect to any Determination Date and the Collateral Pool, the ratio, expressed as a fraction, the numerator of which is the Cashflow Coverage Ratio Numerator for such Determination Date, and the denominator of which is the Total Debt Service for such Determination Date.        “Cashflow Coverage Ratio Numerator ”: With respect to any Determination Date, the sum of (i) the Monthly Loan Payments and the Monthly Lease Payments received during the Collection Period ending on such Determination Date, (ii) any income earned from the investment of funds on deposit in the Collection Account and the Release Account during the Collection Period ending on such Determination Date, (iii) any Liquidity Reserve Amounts and                                     4 US-DOCS\ 96557504.7 102826315.7 

 

(iv) any net payments received by any Issuer under the applicable hedge agreements for any Series of Notes for the Payment Date relating to such Determination Date.        “Cashflow Coverage Reserve Account ”: As defined in the Indenture.        “CERCLA ”: The Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended.        “Closing Date Period ” means the period from (and including) the most recent Series Closing Date until (and excluding) the next occurring Series Closing Date; provided , that the initial Closing Date Period shall commence on the Applicable Series Closing Date.        “Code ”: The Internal Revenue Code of 1986, as amended.        “Collateral ”: As defined in the Indenture.        “Collateral Agent ”: As defined in the Indenture.        “Collateral Defect ”: As defined in Section 2.04(a) .        “Collateral Pool ”: As defined in the Indenture.        “Collateral Value ”: As of any determination date (i) with respect to each Mortgaged Property (that does not otherwise secure a Mortgage Loan), the Appraised Value of such Mortgaged Property as of the First Collateral Date with respect thereto, (ii) with respect to each Mortgage Loan, the lesser of (a) the Appraised Value of the related Mortgaged Property or Mortgaged Properties securing such Mortgage Loan and (b) the outstanding principal balance of such Mortgage Loan, or (iii) with respect to each potential Post-Closing Property identified on Exhibit I, until the earlier of the Post-Closing Acquisition Date and the Post-Closing Deadline, the “Collateral Value” specified for such property on Exhibit I; provided , that, with respect to clause (i) and (ii), in the event that the Property Manager has caused a Global Appraisal Event to occur, the “Appraised Value” of such Mortgaged Property will be the Re-Appraised Value determined with respect to such Mortgaged Property in connection with such Global Appraisal Event.        “Collection Account ”: The segregated account or accounts created and maintained by the Property Manager in the name of the Indenture Trustee, held on behalf of the Noteholders, for the collection of payments on the Mortgage Loans and Leases.        “Collection Account Agreement ”: As defined in Section 3.04(a) .        “Collection Account Bank ”: As defined in Section 3.04(a) .        “Collection Period ”: With respect to any Payment Date, the period commencing immediately after the Determination Date in the month preceding the month in which such Payment Date occurs and ending on (and including) the Determination Date related to such Payment Date.                                     5 US-DOCS\ 96557504.7 102826315.7 

 

      “Companion Loans ”: A mortgage loan or leasehold interest which is secured, on a pari passu  basis by the same Mortgaged Property that secures a Mortgage Loan included in the Collateral Pool.        “Condemnation Proceeds ”: All proceeds received in connection with the condemnation or remediation of, or granting an easement on, any Mortgaged Property other than proceeds applied to the restoration of such Mortgaged Property or released to the related Tenant or Borrower in accordance with the Servicing Standard.        “Control Person ”: With respect to any Person, anyone that constitutes a “controlling person” of such Person within the meaning of the Securities Act of 1933, as amended.        “Controlling Party ”: As defined in the Indenture.        “Corporate Asset Management Agreement ”: A management agreement entered into by Spirit Realty and Spirit MTA in connection with the Spin-Off pursuant to which Spirit Realty or one of its Affiliates (which may include a Taxable REIT Subsidiary) performs services for Spirit MTA which may include, without limitation, investment management and real estate management and servicing.         “ Corrected Lease ”: Any Specially Serviced Lease with respect to which, as of any date of determination, one or more of the following as are applicable shall have occurred with respect to each Specially Serviced Lease Trigger Event that previously occurred with respect to such Specially Serviced Lease:        (i)  with respect to the circumstances described in clause (a) of the definition of the            term “Specially Serviced Lease”, the related Tenant has made three consecutive            full and timely Monthly Lease Payments under the terms of such Lease (as such            terms may be changed or modified in connection with a bankruptcy or similar            proceeding involving the related Tenant or by reason of a modification, waiver or            amendment granted or agreed to by the Special Servicer) or such Lease has been            terminated and the related Mortgaged Property has been re-leased;        (ii) with respect to the circumstances described in clause (b) of the definition of the            term “Specially Serviced Lease”, such circumstances cease to exist in the good            faith and reasonable judgment of the Special Servicer;        (iii) with respect to the circumstances described in clause (c) of the definition of the            term “Specially Serviced Lease”, the Special Servicer determines that the            applicable Tenant likely will be able to make future Monthly Lease Payments;        (iv) with respect to the circumstances described in clause (d) of the definition of the            term “Specially Serviced Lease”, such default is cured; and        (v)  with respect to the circumstances described in clause (e) of the definition of the            term “Specially Serviced Lease”, such proceedings are terminated.                                      6 US-DOCS\ 96557504.7 102826315.7 

 

      “Corrected Loan ”: Any Specially Serviced Loan with respect to which, as of any date of determination, one or more of the following as are applicable shall have occurred with respect to each Specially Serviced Loan Trigger Event that previously occurred with respect to such Specially Serviced Loan:        (i)  with respect to the circumstances described in clause (a) of the definition of the            term “Specially Serviced Loan”, the related Borrower has made three consecutive            full and timely Monthly Loan Payments under the terms of such Mortgage Loan            (as such terms may be changed or modified in connection with a bankruptcy or            similar proceeding involving the related Borrower or by reason of a modification,            waiver or amendment granted or agreed to by the Special Servicer);        (ii) with respect to the circumstances described in clause (b) of the definition of the            term “Specially Serviced Loan”, such circumstances cease to exist in the good            faith and reasonable judgment of the Special Servicer;        (iii) with respect to the circumstances described in clause (c) of the definition of the            term “Specially Serviced Loan”, the Special Servicer determines that the            applicable Borrower likely will be able to make future Monthly Loan Payments;        (iv) with respect to the circumstances described in clause (d) of the definition of the            term “Specially Serviced Loan”, such default is cured; and        (v)  with respect to the circumstances described in clause (e) of the definition of the            term “Specially Serviced Loan”, such proceedings are terminated.        “Cure Party ”: (i) With respect to any Mortgaged Property, Mortgage Loan, Qualified Substitute Mortgage Loan or Qualified Substitute Mortgaged Property acquired by the applicable Issuer from an Originator, such Originator; (ii) with respect to any Mortgage Loan, Mortgaged Property, Qualified Substitute Mortgaged Property or Qualified Substitute Mortgage Loan acquired by the applicable Issuer from a third party unaffiliated with Spirit Realty, such Issuer; and (iii) in the case of either of (i) or (ii), the Support Provider under the Performance Undertaking.        “Custodian ”: As defined in the Indenture.        “Custodian Inventory List ”: As defined in the Custody Agreement.        “Custody Agreement ”: The Second Amended and Restated Custody Agreement, dated as of the Applicable Closing Date, among the Issuers, the Indenture Trustee and the Custodian, as the same may be amended or supplemented from time to time.        “Default Interest ”: With respect to any (i) Lease, any amounts collected thereon (other than late payments, late payment charges or amounts representing the Third Party Option Price (without giving effect to clause (ii) in the definition thereof) paid by the related the Tenant) that represent penalty interest accrued at the rate specified in the related lease agreement and (ii) Mortgage Loan, any amounts collected thereon (other than late payments, late payment charges                                     7 US-DOCS\ 96557504.7 102826315.7 

 

or Prepayment Consideration Payments) that represent penalty interest in excess of interest on the principal balance of such Mortgage Loan accrued at the related Interest Rate.        “Defaulted Asset ”: Any Mortgage Loan or Mortgaged Property included in the Collateral Pool, with respect to which a default occurs under the applicable Mortgage Loan or Lease, respectively, that materially and adversely affects the interests of the applicable Issuer and that continues unremedied for the applicable grace period under the terms of such Mortgage Loan or Lease (or, if no grace period is specified, for 30 days).        “Defaulting Party ”: As defined in Section 6.01(b) .        “Delinquent Asset ”: Any Mortgage Loan or Mortgaged Property included in the Collateral Pool (other than a Defaulted Asset), with respect to which any Monthly Loan Payment or Monthly Lease Payment, as applicable, becomes delinquent for 60 or more consecutive days.        “Determination Date ”: With respect to any Payment Date, the 7 th  day of the month in which such Payment Date occurs or, if such 7 th  day is not a Business Day, the Business Day immediately succeeding such 7 th  day.        “Determination Date Report ”: As defined in Section 4.01(a) .        “Due Date ”: With respect to any Mortgage Loan or Lease, the day of each calendar month on which the Monthly Loan Payment or Monthly Lease Payment, as applicable, with respect thereto is due.        “Early Amortization Event ”: As defined in the Indenture.        “Early Refinancing Prepayment ”: As defined in the Series 2017-1 Supplement.        “Eligible Account ”: As defined in the Indenture.        “Eligible Successor ”: An entity which, at the time it is appointed as Successor Property Manager or Successor Special Servicer, (i) is legally qualified and has the capacity to carry out the duties and obligations hereunder of the Property Manager or Special Servicer, as applicable, and (ii) has demonstrated the ability to administer professionally and competently a portfolio of leases, mortgaged properties and mortgage loans that are similar to the Leases, Mortgaged Properties and Mortgage Loans with high standards of skill and care.        “Emergency Property Expenses ”: As defined in Section 3.03(e) .        “Environmental Condition Mortgaged Property ”: Any Mortgaged Property (i) on which a gasoline station or other gasoline pumping facility is operated, (ii) on which, to the Property Manager’s knowledge, oil or other hazardous materials are stored in underground storage tanks, (iii) in the Manufacturing Business Sector or (iv) any other Mortgaged Property that the Property Manager believes, in its reasonable discretion exercised in accordance with the Servicing Standard (including based on the review of any Environmental Report), has a material risk of declining in value due to environmental conditions existing on or in respect of such Mortgaged Property; provided  that no Mortgaged Property described in clauses (i) through (iv)                                     8 US-DOCS\ 96557504.7 102826315.7 

 

shall be an Environmental Condition Mortgaged Property if the Rating Condition is satisfied with respect to the acquisition of such Mortgaged Property by an Issuer.        “Environmental Indemnity Agreement ”: As defined in the Indenture.        “Environmental Insurer ”: Any Qualified Insurer that issues Environmental Policies relating to any of the Mortgage Loans or Mortgaged Properties.        “Environmental Policy ”: Any insurance policy issued by an Environmental Insurer, together with any endorsements thereto, providing insurance coverage for losses, with respect to certain Mortgage Loans or Mortgaged Properties, caused by the presence of hazardous substances on, or the migration of hazardous substances from, the related Mortgaged Properties.        “Equipment Loan ”: Any commercial equipment loan secured by equipment used in the operation of a commercial real estate property and listed on the Mortgage Loan Schedule.        “Escrow Payment ”: Any payment received by the Property Manager or the Special Servicer for the account of any Obligor or otherwise deposited in the Servicing Account for application toward the payment of real estate taxes, assessments, insurance premiums, ground rents (if applicable) and similar items in respect of the related Mortgaged Property.        “Event of Default ”: As defined in the Indenture.        “Excess Cashflow ”: As defined in the Indenture.        “Exchange Act ”: The Securities Exchange Act of 1934, as amended.        “Exchange Account ”: An account established in the name of the Qualified Intermediary in order to receive all proceeds from the sale or disposition of Relinquished Properties.        “Exchange Agreement ”: An agreement entered into a Qualified Intermediary setting forth the terms of a like-kind exchange program.        “Exchange Cash Collateral ”: With respect to any Mortgaged Property which has been released pursuant to Section 7.01(a), an amount provided by the Issuers that is free and clear of all Liens in an amount equal to the Net Release Price thereof that is deposited into the Exchange Reserve Account.        “Exchange Reserve Account ”: As defined in Section 3.04(c) .        “Extraordinary Expense ”: As defined in the Indenture.        “Fair Market Value ”: With respect to any Mortgaged Property or Mortgage Loan secured by a Mortgaged Property, at any time, a price determined by the Property Manager (or by the Special Servicer with respect to a Specially Serviced Asset) in accordance with the Servicing Standard and Section 7.01(b) .                                      9 US-DOCS\ 96557504.7 102826315.7 

 

      “FDIC ”: Federal Deposit Insurance Corporation or any successor.        “Financing Statement ”: A financing statement either filed or recorded or in a form suitable for filing and recording under the applicable Uniform Commercial Code.        “First Collateral Date ”: With respect to any Mortgaged Property or Mortgage Loan, (i) in the event that such Mortgaged Property or Mortgage Loan was (or is) added to the Collateral Pool on a Series Closing Date on which such Issuer became an “Issuer” hereunder, such Series Closing Date or (ii) otherwise, the Transfer Date with respect thereto.        “Fixed Charge Coverage Ratio ” or “ FCCR ”: The fixed charge coverage ratio determined in accordance with the provisions of Exhibit E  attached hereto.        “FNMA ”: Federal National Mortgage Association or any successor.        “GAAP ”: Generally accepted accounting principles as in effect in the United States, consistently applied, as of the date of such application.        “Global Appraisal Event ”: An event that shall occur when the Property Manager, within a one-year period, both (i) causes new Appraised Values to be determined with respect to all of the Mortgaged Properties and (ii) designates (in its sole discretion) that a “Global Appraisal Event” has occurred in connection therewith.        “Granting Clause ”: The Granting Clause set forth in the Indenture.        “Ground Lease ”: With respect to any Mortgaged Property the fee interest in which is owned by an Issuer or the related Borrower, the lease agreement, if any, pursuant to which such Issuer leases the land relating to such Mortgaged Property to the related tenant and such tenant owns the buildings and other improvements on such Mortgaged Property.        “Guaranty ”: With respect to any Lease or Mortgage Loan, the guaranty, if any, related to such Lease or Mortgage Loan executed by an individual or an Affiliate or parent of the Tenant or Borrower, as applicable, in favor of the lessor or the lender, as applicable.        “Hazardous Materials ”: As defined in the Indenture.        “Indenture ”: The Second Amended and Restated Master Indenture, dated as of the Applicable Series Closing Date, among the Issuers and the Indenture Trustee, relating to the issuance of the Notes, including all amendments, supplements and other modifications thereto and any additional indenture between the Indenture Trustee and any Issuer.        “Indenture Trustee ”: Citibank, N.A., a national banking association, in its capacity as indenture trustee under the Indenture, or its successor in interest or any successor indenture trustee appointed as provided in the Indenture.        “Indenture Trustee Fee ”: As defined in the Indenture.                                      10 US-DOCS\ 96557504.7 102826315.7 

 

      “Independent ”:  When used with respect to any specified Person, any such Person who (i) is not an Issuer, an Issuer Member, the Indenture Trustee, the Property Manager, the Special Servicer or an Affiliate thereof, (ii) does not have any direct financial interest in or any material indirect financial interest in any of the Issuers, the Issuer Members, the Indenture Trustee, the Property Manager, the Special Servicer or any of their respective Affiliates, and (iii) is not connected with the Issuers, the Issuer Members, the Indenture Trustee, the Property Manager, the Special Servicer or any of their respective Affiliates as an officer, employee, promoter, underwriter, trustee, partner, director or Person performing similar functions; provided , however , that a Person shall not fail to be Independent of the Issuers, the Issuer Members, the Indenture Trustee, the Property Manager, the Special Servicer or an Affiliate thereof merely because such Person is the beneficial owner of 1% or less of any class of securities issued by any Issuer, any Issuer Member, the Indenture Trustee, the Property Manager, the Special Servicer or an Affiliate thereof, as the case may be.        “Initial Purchaser ”: As defined in the Indenture.        “Interest Accrual Period ”: With respect to each Due Date related to any Mortgage Loan, the applicable period specified in the related Loan Documents.        “Interest Rate ”: With respect to any Mortgage Loan, the annualized rate at which interest is scheduled (in the absence of a default) to accrue on such Mortgage Loan from time to time during any Interest Accrual Period in accordance with the related Mortgage Note and applicable law, as such rate may be modified in accordance with Section 3.19  or in connection with a bankruptcy, insolvency or similar proceeding involving the related Borrower.        “Interested Person ”: The Issuers, the Issuer Members, the Property Manager, the Special Servicer, any holder of Notes or an Affiliate of any such Person.        “Issuer ”: Each of Spirit Master Funding, LLC, Spirit Master Funding II, LLC, Spirit Master Funding III, LLC, Spirit Master Funding VI, LLC, Spirit Master Funding VIII, LLC and any Joining Party or, in any such case, its successor in interest, as the context may require. References to a “related” or “applicable” Issuer shall refer to the Issuer that owns the Collateral or has issued the Notes being addressed.        “Issuer Member ”: With respect to any Issuer, the holder of the LLC Interests with respect to such Issuer, and with respect to any Joining Party, as indicated in the applicable Joinder Agreement.        “Joinder Agreement ”: With respect to any Series of Notes (other than any Series of Notes that was issued on the Applicable Series Closing Date), the Joinder Agreement, dated as of the applicable Series Closing Date, among the applicable Joining Party, the Property Manager, the Special Servicer and the Back-Up Manager, substantially in the form of Exhibit G attached hereto.        “Joining Party ”: Any Spirit SPE or Support Provider SPE, as indicated in the applicable Joinder Agreement.                                      11 US-DOCS\ 96557504.7 102826315.7 

 

      “Lease ”: Each lease listed on the Mortgaged Property Schedule and from time to time included in the Collateral Pool. As used herein, the term “Lease” includes the related lease agreement and other documents contained in the related Lease File as the context may require.        “Lease Documents ”: Any related lease agreement, non-disturbance agreement, guaranty or other agreement or instrument, to the extent made for the benefit of the related Originator.        “Lease File ”: As defined in the Custody Agreement.        “Lease Security Deposit ”: As defined in Section 3.03(a) .        “Lease Transfer Mortgaged Property ”: As defined in Section 7.03 .        “Like-Kind Exchange Program ”: A like-kind exchange program whereby Relinquished Property may be exchanged with Replacement Property pursuant to an Exchange Agreement with a Qualified Intermediary.        “Liquidated Lease ”: A Defaulted Asset that is a Lease with respect to which the related Mortgaged Property has been either re-leased or sold, or any Lease related to a Mortgaged Property sold, exchanged or otherwise disposed of by such Issuer, whether or not a Defaulted Asset.        “Liquidation Fee ”: The fee payable to the Special Servicer pursuant to Section  3.11(g) .        “Liquidation Fee Rate ”: A percentage equal to 0.50%.        “Liquidation Proceeds ”: All cash proceeds and all other amounts (other than Property Insurance Proceeds and REO Revenues) received by the applicable Issuer, the Property Manager, or the Special Servicer and retained in connection with the liquidation of any Mortgage Loan, Lease or Mortgaged Property which is (or relates to) a Defaulted Asset; all cash proceeds and all other amounts (other than Property Insurance Proceeds and REO Revenues) from the release or substitution of any Mortgage Loan or Mortgaged Property other than to the extent deposited into the Release Account; all proceeds from the investment of funds on deposit in the Release Account; and all cash proceeds from the release or substitution of any Mortgage Loan or Mortgaged Property transferred from the Release Account to the Collection Account pursuant to Section 3.04(b).        “LLC Agreement ”: With respect to (i) any Issuer that constitutes an Issuer as of the date hereof, such Issuer’s limited liability company agreement and (ii) any other Issuer, as indicated in the applicable Joinder Agreement, in each case as the same may be amended from time to time in accordance with the terms thereto and the Indenture.        “LLC Interests ”: The limited liability company interests issued pursuant to an LLC Agreement evidencing beneficial ownership interests in the related Issuer.        “Loan Agreement ”: The agreement pursuant to which a Mortgage Loan was made.                                      12 US-DOCS\ 96557504.7 102826315.7 

 

      “Loan Documents ”: With respect to each of the Mortgage Loans, the related Loan Agreement, if any, and Mortgage Note, and any related Mortgage, Ground Lease, as applicable, Guaranty or other agreement or instrument, to the extent made for the benefit of the related lender or holder of the Mortgage Note.        “Loan File ”: As defined in the Custody Agreement.        “Loan-to-Value Ratio ”: With respect to any Mortgage Loan and any commercial real estate loan proposed to be included in the Collateral Pool as a Qualified Substitute Mortgage Loan, a ratio, expressed as a percentage, the numerator of which is the unpaid principal balance of such Mortgage Loan (or proposed Qualified Substitute Mortgage Loan) and the denominator of which is the Appraised Value of the Mortgaged Property securing such Mortgage Loan (or the Mortgaged Property securing the proposed Qualified Substitute Mortgage Loan).        “Lockbox Account ”: The account or accounts created and maintained pursuant to Section 3.02(b) .        “Lockbox Account Bank ”: As defined in Section 3.02(b) .        “Lockbox Transfer Account ”: The account or accounts created and maintained pursuant to Section 3.02(c) .        “Lockbox Transfer Account Bank ”: As defined in Section 3.02(c) .        “MAI ”: A designation signifying that the designee is a member of the Appraisal Institute, a real estate appraisers and valuation professionals trade group.        “Modified Collateral Detail and Realized Loss Report”: As defined in Section 4.01(c) .        “Monthly Lease Payment ”: With respect to any Lease (except as otherwise described in the Mortgaged Property Schedule), the fixed or “base” rent monthly lease payment that is actually payable by the related Tenant from time to time under the terms of such Lease, after giving effect to any provision of such Lease providing for periodic increases in such fixed or “base” rent by fixed percentages or dollar amounts or by percentages based on increases in a consumer price index.        “Monthly Loan Payment ”: With respect to any Mortgage Loan, the scheduled monthly payment of interest and, if applicable, principal due on such Mortgage Loan that is or would be, as the case may be, payable by the related Borrower on each Due Date under the terms of the related Mortgage Note as in effect on the First Collateral Date with respect to such Mortgage Loan, without regard to any subsequent change in or modification of such terms in connection with a bankruptcy or similar proceeding involving the related Borrower or a modification, waiver or amendment of such Mortgage Loan granted or agreed to by the Special Servicer pursuant to Section 3.19 , and assuming that each prior Monthly Loan Payment has been made in a timely manner.        “Moody’s ”: Moody’s Investors Service, Inc.                                     13 US-DOCS\ 96557504.7 102826315.7 

 

      “Mortgage ”: With respect to any Mortgaged Property, a mortgage (or deed of trust or deed to secure debt), assignment of leases and rents, security agreement and fixture filing or similar document executed by the applicable Issuer or the related Borrower, as applicable, pursuant to which such Issuer or Borrower grants a lien on its interest in such Mortgaged Property in favor of the Collateral Agent or the initial lender of the related Mortgage Loan, as applicable.        “Mortgage Loan ”: Each fixed-rate or adjustable-rate, monthly pay, first lien, commercial mortgage loan secured by fee title to, or leasehold interest in, commercial real estate properties (including each similarly secured, fixed-rate or adjustable-rate, monthly pay, first lien mortgage loan acquired after the applicable Series Closing Date), as listed on the Mortgage Loan Schedule and from time to time included in the Collateral Pool.        “Mortgage Loan Schedule ”: The list of Mortgage Loans transferred to each Issuer as part of the Collateral Pool and attached hereto as Exhibit A-2  (as such list may be amended upon each Series Closing Date and each Transfer Date, and otherwise be amended from time to time in accordance with the Transaction Documents, including to reflect the conveyance by an Issuer of any Mortgage Loan pursuant to the terms hereof). Such list shall set forth the following information with respect to each Mortgaged Loan:        (i)  the street address (including city, state and zip code) of the related Mortgaged            Property (if any);        (ii) the related Issuer loan number and name of Borrower;        (iii) the initial Appraised Value of any related Mortgaged Property; and        (iv) the Mortgage Loan’s maturity date, if applicable.        “Mortgage Note ”: The original executed note evidencing the indebtedness of a Borrower under a Mortgage Loan, together with any rider, addendum or amendment thereto, or any renewal, substitution or replacement of such note.        “Mortgaged Property ”: Each parcel of real property listed on the Mortgaged Property Schedule, the fee or leasehold interest in which is from time to time included in the Collateral Pool, and each parcel of real property or leasehold interest in a commercial real estate property securing a Mortgage Loan, including (to the extent not property of the related Tenant) the buildings, structures, fixtures, additions, enlargements, extensions, modifications, repairs, replacements or improvements now or hereinafter erected or located on such parcel and appurtenant easements and other property rights relating thereto.        “Mortgaged Property Schedule ”: The list of Mortgaged Properties and Leases transferred to each Issuer as part of the Collateral Pool and attached hereto as Exhibit A-1  (as such list may be amended upon each Series Closing Date and each Transfer Date, and otherwise be amended from time to time in accordance with the Transaction Documents, including to                                      14 US-DOCS\ 96557504.7 102826315.7 

 

reflect the conveyance by an Issuer of any Mortgaged Property pursuant to the terms hereof). Such list shall set forth the following information with respect to each Mortgaged Property:        (i)  the street address (including city, state and zip code) of the Mortgaged Property;        (ii) the related Issuer lease number and name of Tenant;        (iii) the Appraised Value; and        (iv) the Lease’s final payment date.        “Net Assets ” As defined in Section 6.04(b) .        “Net Default Interest ”: With respect to any (i) Lease, any Default Interest collected thereon, net of any unreimbursed Advance Interest accrued on Property Protection Advances made in respect of such Lease and reimbursable from such Default Interest in accordance with the terms hereof and (ii) Mortgage Loan, any Default Interest collected thereon, net of any unreimbursed Advance Interest accrued on Property Protection Advances made in respect of such Mortgage Loan and reimbursable from such Default Interest in accordance with the terms hereof.        “Net Investment Earnings ”: The amount by which the aggregate of all interest and other income realized during a Collection Period on funds held in the Collection Account, the Exchange Reserve Account and/or the Release Account (as the context may require), if any, exceeds the aggregate of all losses, if any, incurred during such Collection Period in connection with the investment of such funds.        “Net Release Price ”: As defined in Section 3.05(b) .        “Nonrecoverable Advance ”: Any Nonrecoverable P&I Advance and/or Nonrecoverable Property Protection Advance, as the context may require.        “Nonrecoverable P&I Advance ”: Any P&I Advance previously made or proposed to be made in respect of any Payment Date, that, as determined by the Property Manager (or, if applicable, the Back-Up Manager or Indenture Trustee), in its commercially reasonable, good faith business judgment and (other than with respect to any such determination made by the Indenture Trustee) in accordance with the Servicing Standard, will not be ultimately recoverable by it from the proceeds on the Collateral Pool allocated in accordance with the priority set forth in Section 2.11  of the Indenture with respect to the payment of Collateral Pool Expenses.        “Nonrecoverable Property Protection Advance ”: Any Property Protection Advance previously made or proposed to be made in respect of a Mortgaged Property (including any Lease related thereto) or Mortgage Loan that, as determined by the Property Manager (or, if applicable, the Back-Up Manager or Indenture Trustee), in its commercially reasonable good faith business judgment and (other than with respect any such determination made by the Indenture Trustee) in accordance with the Servicing Standard, will not be ultimately recoverable from late payments, Property Insurance Proceeds, Liquidation Proceeds or any other recovery on or in respect of the related Mortgage Loan or Mortgaged Property or related Lease with respect                                     15 US-DOCS\ 96557504.7 102826315.7 

 

to which such Property Protection Advance was (or is proposed to be) made (including any Monthly Lease Payments in respect of any Lease added to the Collateral upon any re-leasing of the related Mortgaged Property).        “Note Registrar ”: As defined in the Indenture.        “Notes ”: As defined in the Indenture.        “Noteholders ”: As defined in the Indenture.        “Obligor ”: A Tenant or a Borrower, as the context requires.        “Officer’s Certificate ”: A certificate signed by a Servicing Officer of the Property Manager or the Special Servicer or a Responsible Officer of the Indenture Trustee or the applicable Issuer Member on behalf of an Issuer, as the case may be, and with respect to any other Person, a certificate signed by the Chairman of the Board, the President, a Vice President or Assistant Vice President, the Treasurer, the Secretary, or one of the Assistant Treasurers or Assistant Secretaries of such Person.        “Opinion of Counsel ”: A written opinion of counsel (which shall be rendered by counsel that is Independent of the Issuers, the Issuer Members, the Indenture Trustee, the Property Manager and the Special Servicer) in form and substance reasonably acceptable to and delivered to the addressees thereof.        “Originators ”: Collectively, each of Spirit Realty and its Affiliates which has conveyed one or more Mortgage Loans or Mortgaged Properties to an Issuer pursuant to a Property Transfer Agreement or otherwise.        “OTS ”: The Office of Thrift Supervision or any successor thereto.        “P&I Advance ”: As defined in Section 3.03(g)  hereof.        “P&I Shortfall ”: With respect to any Series of Notes and any Payment Date, in the event that the Series Available Amount allocated (or to be allocated) to such Series of Notes in respect of such Payment Date will be insufficient to pay in full (x) the P&I Shortfall Scheduled Principal Payment  (if  any),  in  respect  of  the  Notes  of  such  Series  due  on  such  Payment  Date   and ,  (y) accrued and unpaid Note Interest in respect of the Notes of such Series due on  such  Payment Date   and   (z)   the   aggregate   VFN   Administrative   Agent   fees   and   VFN   Undrawn Commitment  Fees  due  on  the  Variable  Funding  Notes  of  such  Series  on such Payment Date, in each case in accordance with the terms of the Series Supplement with respect to such Series of Notes, the amount of such insufficiency for such Payment Date. For the avoidance of doubt and notwithstanding the foregoing, in no event shall P&I Shortfall include any Make Whole Amount, Class  B  Deferred  Interest,  Post-ARD  Additional  Interest  or  Deferred  Post-ARD  Additional Interest        “P&I Shortfall Scheduled Principal Balance Payment ”: With respect to any Series of Notes and any Payment Date, the Scheduled Principal Payment (if any) with respect to each                                     16 US-DOCS\ 96557504.7 102826315.7 

 

Class of Notes in such Series other than any such Class of Notes whose Anticipated Repayment Date (x) occurs on such Payment Date or (y) has occurred prior to such Payment Date.        “Pari Passu Co-Lender Agreements ”: Any co-lender agreement relating to any Issuer acquiring Pari Passu Loans secured by Mortgaged Properties (or leasehold interests in real property) that also secure Companion Loans held by parties other than such Issuer.        “Pari Passu Loans ”: Mortgage Loans secured by Mortgaged Properties (or leasehold interests in real property) that also secure on a pari passu  basis any Companion Loans.        “Payment Account ”: As defined in the Indenture.        “Payment Date ”: As defined in the Indenture.        “Payoff Amount ”: An amount equal to the Collateral Value as of the First Collateral Date of any Mortgage Loan or Mortgaged Property, as applicable, plus any due and unpaid Monthly Loan Payment(s) or Monthly Lease Payment(s), as applicable, and any unreimbursed Property Protection Advances (plus Advance Interest thereon), Emergency Property Expenses, Liquidation Fees, Workout Fees, Special Servicing Fees and Extraordinary Expenses, in each case with respect to such Mortgage Loan or Mortgaged Property or the related Lease.        “Percentage Rent ”: With respect to any Lease that does not provide for the payment of fixed rent, the rent thereunder, if any, calculated solely as a percentage of the total sales generated by the related Tenant at the related Mortgaged Property.        “Performance Undertaking ”: As defined in the Indenture.        “Permitted Investments ”: Any one or more of the following obligations or securities:        (i)  direct obligations of, or obligations fully guaranteed as to timely payment of            principal and interest by, the United States of America or any agency or            instrumentality thereof; provided , that such obligations are backed by the full faith            and credit of the United States of America and have a predetermined, fixed            amount of principal due at maturity (that cannot vary or change) and that each            such obligation has a fixed interest rate or has its interest rate tied to a single            interest rate index plus a single fixed spread;        (ii) obligations of the following agencies or instrumentalities of the United States of            America: the Export-Import Bank, the Farm Credit System Financial Assistance            Corporation, the Rural Economic Community Development Administration, the            General Services Administration, the U.S. Maritime Administration, the Small            Business Administration, the Government National Mortgage Association, the            U.S. Department of Housing & Urban Development, the Federal Housing            Administration and the Federal Financing Bank; provided , that such obligations            are backed by the full faith and credit of the United States of America, have a            predetermined, fixed amount of principal due at maturity (that cannot vary or            change) and do not have an “r” highlight attached to any rating and that each such                                     17 US-DOCS\ 96557504.7 102826315.7 

 

           obligation has a fixed interest rate or has its interest rate tied to a single interest            rate index plus a single fixed spread;        (iii) direct obligations of the following agencies or instrumentalities of the United            States of America that are not backed by the full faith and credit of the United            States: the Resolution Funding Corporation, the Federal Home Loan Bank System            (senior debt obligations only), the Federal National Mortgage Association (senior            debt obligations rated “Aaa” by Moody’s and “AAA” by S&P only) or the Federal            Home Loan Mortgage Corporation (senior debt obligations rated “Aaa” by            Moody’s and “AAA” by S&P only); provided , that such obligations have a            predetermined amount of principal due at maturity (that cannot vary or change)            and do not have an “r” highlight attached to any rating and that each such            obligation has a fixed interest rate or has its interest rate tied to a single interest            rate index plus a single fixed spread;        (iv) uncertificated certificates of deposit, time deposits and bankers’ acceptances            having maturities of not more than 360 days, of any bank or trust company            organized under the laws of the United States of America or any state thereof;            provided , that such items are rated in the highest short-term debt rating category            of each Rating Agency or such lower rating as will not result in a qualification,            downgrading or withdrawal of the rating then assigned to the Notes by any Rating            Agency without giving effect to any Insurance Policy (as evidenced in writing by            each Rating Agency), do not have an “r” highlight affixed to its rating and have a            predetermined fixed amount of principal due at maturity (that cannot vary or            change);        (v)  commercial paper (having original maturities of not more than 270 days) of any            corporation incorporated under the laws of the United States of America or any            state thereof (or of any corporation not so incorporated; provided , that the            commercial paper is denominated in United States dollars and amounts payable            thereunder are not subject to any withholding imposed by any non-United States            jurisdiction) that is rated in the highest short-term debt rating category of each            Rating Agency or such lower rating as will not result in a qualification,            downgrading or withdrawal of the rating then assigned to the Notes by any Rating            Agency without giving effect to any Insurance Policy (as evidenced in writing by            each Rating Agency), does not have an “r” highlight affixed to its rating, has a            predetermined fixed amount of principal due at maturity (that cannot vary or            change) and has a fixed interest rate or has its interest rate tied to a single interest            rate index plus a single fixed spread, or any demand notes that constitute vehicles            for commercial paper rated in the highest unsecured commercial or finance            company paper rating category of each Rating Agency;        (vi) investments in money market funds rated “AA-mg” (or the equivalent rating) or            higher by each Rating Agency; and                                      18 US-DOCS\ 96557504.7 102826315.7 

 

      (vii) any other obligation or security the inclusion of which, as an Eligible Investment,            satisfies the Rating Agency Notification Condition.  provided , that (1) no investment described hereunder shall evidence either the right to receive (x) only interest with respect to such investment or (y) a yield to maturity greater than 120% of the yield to maturity at par of the underlying obligations, (2) no investment described hereunder may be purchased at a price greater than par if such investment may be prepaid or called at a price less than its purchase price prior to stated maturity (that cannot vary or change) and (3) such Permitted Investments are either (x) at all times available or (y) mature prior to the Payment Date on which funds used to acquire such investment would otherwise be distributed pursuant to Section 2.11 of the Indenture.        “Permitted Replacement Event ”: As defined in Section 6.04(a) hereof.        “Permitted Termination Event ”: As defined in Section 6.04(b) hereof.        “Person ”: Any individual, corporation, partnership, joint venture, association, joint-stock company, limited liability company, trust, estate, unincorporated organization or government or any agency, instrumentality or political subdivision of any government, or any definition of such term as may be provided in Sections 13(d) and 14(d) of the Exchange Act.        “Post-Closing Acquisition Reserve Account ”: As defined in the Indenture.        “Post-Closing Property ”: As defined in the Indenture.        “Prepayment Consideration Payment ”: With respect to any Mortgage Loan, any yield maintenance or prepayment premium payment made by a Borrower in connection with a Principal Prepayment on or other early collection of principal of a Mortgage Loan.        “Primary Servicing Office ”: The office of the Property Manager or the Special Servicer, as the context may require, that is primarily responsible for such party’s servicing obligations hereunder.        “Prime Rate ”: The “prime rate” published in the “Money Rates” section of The Wall Street Journal,  as such “prime rate” may change from time to time. If The Wall Street Journal ceases to publish the “prime rate,” then the Indenture Trustee shall select an equivalent publication that publishes such “prime rate”; and if such “prime rate” is no longer generally published or is limited, regulated or administered by a governmental or quasi-governmental body, then the Indenture Trustee shall select a comparable interest rate index. In either case, such selection shall be made by the Indenture Trustee in its sole discretion and the Indenture Trustee shall notify the Property Manager and the Special Servicer in writing of its selection.         “ Principal Prepayment ”: Any payment of principal voluntarily made by the Borrower on a Mortgage Loan that is received in advance of its scheduled Due Date and that is not accompanied by an amount of interest (without regard to any Prepayment Consideration Payment                                      19 US-DOCS\ 96557504.7 102826315.7 

 

that may have been collected) representing scheduled interest due on any date or dates in any month or months subsequent to the month of prepayment.         “ Property Insurance Policy ”: With respect to any Mortgage Loan and/or Mortgaged Property, any hazard insurance policy, flood insurance policy, title policy, Environmental Policy, residual value insurance policy or other insurance policy that is maintained from time to time in respect of such Mortgage Loan and/or Mortgaged Property (including, without limitation, any blanket insurance policy maintained by or on behalf of the applicable Issuer).        “Property Insurance Proceeds ”: All proceeds received under any Property Insurance Policy that provides coverage with respect to any Mortgaged Property or the related Mortgage Loan, if applicable.         “ Property Management Fee ”: With respect to each Mortgage Loan and each Mortgaged Property owned by the Issuer, the fee payable to the Property Manager pursuant to Section 3.11(a) .        “Property Management Fee Rate ”: With respect to each Mortgage Loan and each Lease, a fixed percentage rate equal to 0.25% per annum.        “Property Manager ”: Spirit Realty, in its capacity as property manager under this Agreement, or any successor property manager appointed as herein provided.        “Property Manager Additional Servicing Compensation ”: As defined in  Section 3.11(b) .        “Property Protection Advances ”: With respect to the Leases, the Mortgage Loans and the Mortgaged Properties:        (i)  All customary, reasonable and necessary out-of-pocket costs and expenses            incurred by the Property Manager or the Back-Up Manager, in connection with            servicing the Leases, the Mortgaged Properties and the Mortgage Loans, in            accordance with the Servicing Standard and this Agreement, for the purpose of            paying (a) real estate taxes, (b) in the case of Leasehold Mortgaged Properties,            payments required to be made under the related ground leases, (c) premiums on            Property Insurance Policies (not already paid pursuant to Section 2.11 of the            Indenture, as confirmed by the applicable Issuers) and (d) other amounts            necessary to preserve or maintain the security interest and lien of the Indenture            Trustee in, and value of, each related Mortgaged Property (including any costs            and expenses necessary to re-lease such Mortgaged Property), Lease or Mortgage            Loan (including costs and expenses related to collection efforts).        (ii) All customary, reasonable and necessary out-of-pocket costs and expenses            incurred by the Property Manager or the Back-Up Manager (or, if applicable, the            Special Servicer) in connection with the servicing of a Mortgage Loan after a            default, delinquency or other unanticipated event, or in connection with the            administration of any REO Property, including, but not limited to, the cost of (a)                                     20 US-DOCS\ 96557504.7 102826315.7 

 

           compliance with the obligations of the Property Manager or the Special Servicer            set forth in Sections 2.04(c) , 3.03(c)  and 3.17(b) , (b) the preservation, insurance,            restoration, protection and management of any Collateral, including the cost of            any “force placed” insurance policy purchased by the Property Manager to the            extent such cost is allocable to a particular item of Collateral that the Property            Manager is required to cause to be insured pursuant to Section 3.07(a) , (c)            obtaining any Liquidation Proceeds (insofar as such Liquidation Proceeds are of            the nature described in the definition thereof) or Property Insurance Proceeds in            respect of any Collateral or REO Property, (d) any enforcement of judicial            proceedings with respect to any Collateral, including foreclosures, and (e) the            operation, management, maintenance and liquidation of any REO Property.        Notwithstanding anything to the contrary, “Property Protection Advances” shall not include allocable overhead of the Property Manager or the Special Servicer, such as costs for office space, office equipment, supplies and related expenses, employee salaries and related expenses and similar internal costs and expenses.        “Property Transfer Agreements ”: As defined in the Indenture.        “Protective Mortgage Loan ”: Means any Mortgage Loan (a) with respect to which Spirit Realty or an affiliate thereof is the Borrower and (b) that was acquired by any Issuer in lieu of such Issuer acquiring the Mortgaged Property or Mortgaged Properties securing such Mortgage Loan in order to reduce or eliminate any actual or potential liability that such Issuer would have had in the event that such Mortgaged Property or Mortgaged Properties were acquired by such Issuer.        “Purchase Option Deficiency ”: An amount equal to the deficiency, if any, between 115% of the Allocated Loan Amount of a Mortgaged Property released in connection with a Third Party Purchase Option and the related Third Party Option Price for such Mortgaged Property.        “Purchase Premium ”: As defined in Section 7.01(c).        “Qualified Deleveraging Event ”: Either (i) a firm commitment underwritten public offering of the equity interests of Spirit MTA or any direct or indirect parent entity of Spirit MTA pursuant to a registration statement under the Securities Act, which results in aggregate cash proceeds to Spirit MTA or any direct or indirect parent entity of Spirit MTA of at least $75 million (net of underwriting discounts and commissions), (ii) an acquisition (whether by merger, consolidation or otherwise) of greater than fifty percent (50%) of the voting equity interests of Spirit MTA, or any direct or indirect parent of Spirit MTA by any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) or (iii) Spirit MTA or any direct or indirect parent or subsidiary of Spirit MTA sells or transfers (whether by merger, consolidation or otherwise) all of its interests in the Issuers or the Issuers convey or transfer (whether by merger, consolidation or otherwise) all or substantially all the Collateral Pool in accordance with the applicable restrictions in the Indenture (in each case, other than a sale, transfer or other conveyance to a direct or indirect parent or wholly owned subsidiary of Spirit MTA).                                     21 US-DOCS\ 96557504.7 102826315.7 

 

      “Qualified Eligible Successor ”: As defined in Section 6.04(b).        “Qualified Insurer ”: An insurance company or security or bonding company qualified to write the related Property Insurance Policy in the relevant jurisdiction.        “Qualified Intermediary ”: Any third-party acting as an “qualified intermediary” within the meaning of Section 1031 of the Code and Section 1.1031(k)-1(g)(4) of the Treasury Regulations.         “ Qualified Release Amount ”: An amount equal to the product of (i) the amount of the Early Refinancing Prepayment and (ii) (a) the aggregate Collateral Value of all Mortgaged Properties (not otherwise securing a Mortgage Loan) and Mortgage Loans divided by (b) the aggregate Allocated Loan Amount of the Collateral Pool.        “Qualified Substitute Mortgage Loan ”: (X) Any Qualified Substitute Protective Mortgage Loan or (Y) any other commercial real estate loan acquired by an Issuer, which, in the case of clause (Y), is: (a) in substitution for a Released Mortgage Loan, (b) with the proceeds (or a portion thereof) from the sale of a Released Mortgage Loan or (c) with the proceeds (or a portion thereof) of a Balloon Payment or Principal Prepayment on a Mortgage Loan and which, in each such case, as of the date of the acquisition thereof, (i) is secured by one or more Mortgaged Properties that would constitute a Qualified Substitute Mortgaged Property (other than any requirements set forth in clauses (iii) and (vii) of the definition thereof) in the event that it (or they) were exchanged by such Issuer for the Mortgaged Property (or Mortgaged Properties) securing such Released Mortgage Loan or the Mortgage Loan with respect to which such Balloon Payment or Principal Prepayment was received, as applicable (it being understood that, for the purposes of this clause (i), the Collateral Value of each such Mortgaged Property shall be determined in accordance with clause (i) of the definition of “Collateral Value” as if it did not secure a Mortgage Loan), (ii) has an unpaid principal balance that, when combined with any cash proceeds received (or to be received) in connection with such substitution or such sale, if applicable, and the principal balance of each other commercial real estate loan acquired (or to be acquired) by the applicable Issuer in substitution for such Released Mortgage Loan or with the proceeds of such sale or such Balloon Payment or Principal Prepayment, as applicable, is not less than the unpaid principal balance of such Released Mortgage Loan or the amount of such Balloon Payment or Principal Prepayment, as applicable (other than the amount of such Balloon Payment or Principal Prepayment that will remain in the Release Account after giving effect to such acquisition), (iii) has an Interest Rate not more than one percentage point less than such Released Mortgage Loan or the Mortgage Loan with respect to which such Balloon Payment or Principal Prepayment was made, as applicable, (iv) subject to any exceptions with respect to which the Rating Condition is satisfied or the Requisite Global Majority has consented, the applicable Issuer has obtained from an Originator or itself has made, with respect to such commercial real estate loan, either (x) all of the representations and warranties originally made with respect to such Released Mortgage Loan or Mortgage Loan with respect to which such Balloon Loan or Principal Prepayment was made or (y) all of the representations and warranties required to be made for Mortgage Loans pursuant to Section 2.19 of the Indenture (in each case, with each date therein referring to, unless otherwise expressly stated, the date of such acquisition ), (v) pays interest and, if applicable, principal on a monthly basis, (vi) has been approved in writing by the Support Provider, (vii) has a maturity date that is not more than one                                     22 US-DOCS\ 96557504.7 102826315.7 

 

year earlier than such Released Mortgage Loan or Mortgage Loan with respect to which the Balloon Payment or Principal Prepayment was made, (viii) if such commercial real estate loan would constitute a Balloon Loan and either such Released Mortgage Loan was a Balloon Loan or such commercial real estate loan is being acquired with the proceeds of a Balloon Payment, such commercial real estate loan has a balloon payment that is not more than 10.0% larger than the Balloon Payment relating to such Released Mortgage Loan or such Balloon Payment, as applicable and (ix) that has a Loan-to-Value Ratio no greater than the higher of (a) 80.0% and (b) the Loan-to-Value Ratio of the Released Mortgage Loan (or the Mortgage Loan with respect to which the Balloon Payment or Principal Prepayment was made). If one or more of the foregoing criteria are not met (x) other than with respect to a commercial real estate loan being acquired with the proceeds of a Balloon Payment or Principal Prepayment, such commercial real estate loan will be a Qualified Substitute Mortgage Loan if the Qualified Substitute Mortgage Loan Waiver Criteria are satisfied with respect to such commercial real estate loan or (y) with respect to a commercial real estate loan being acquired with the proceeds of a Balloon Payment or Principal Prepayment, such commercial real estate loan will be a Qualified Substitute Mortgage Loan if the Special Servicer considers such acquisition to be in the interest of the Noteholders and the Rating Agency Notification Condition is satisfied in connection with such acquisition.        “Qualified Substitute Mortgage Loan Waiver Criteria ”: Means criteria that will be satisfied with respect to any commercial real estate loan in the event that: (1) the Special Servicer considers the acquisition by the applicable Issuer of such commercial real estate loan to be in the interest of the Noteholders and (2) either (x) the Rating Condition is satisfied in connection with such acquisition or (y) both (A) the Rating Agency Notification Condition is satisfied in connection with such acquisition and (B) after giving effect to such acquisition, the aggregate Collateral Values (determined as of the date of acquisition by the applicable Issuer) of all commercial real estate loans acquired pursuant to this clause (2)(y) and all commercial real estate properties acquired pursuant to clause (2)(y) of the Qualified Substitute Mortgaged Property Waiver Criteria, in each case during the Closing Date Period in which such acquisition occurs, will not exceed 5.0% of the Aggregate Collateral Value (determined as of the Starting Closing Date with respect to such Closing Date Period).        “Qualified Substitute Mortgaged Property ”: Any commercial real estate property acquired by the applicable Issuer (a) in substitution for a Released Mortgaged Property or a Released Mortgage Loan, (b) with the proceeds (or a portion thereof) from the sale of a Released Mortgaged Property or Released Mortgage Loan or (c) with the proceeds (or a portion thereof) of a Balloon Payment or Principal Prepayment on a Mortgage Loan and which, in any case, as of the date of the acquisition thereof, (i) solely to the extent acquired with amounts on deposit in the Release Account, has a Collateral Value that, when combined with any cash proceeds received (or to be received) in connection with such substitution or such sale, if applicable, and the Collateral Value of each other commercial real estate property acquired (or to be acquired) by the applicable Issuer or Co-Issuer in substitution for such Released Mortgaged Property or Released Mortgage Loan or with the proceeds of such sale or such Balloon Payment or Principal Prepayment, as applicable, is equal to or greater than (x) in the case of a Released Mortgaged Property, the Fair Market Value of such Released Mortgaged Property, (y) in the case of a Released Mortgage Loan, the principal balance of such Released Mortgage Loan or (z)                                     23 US-DOCS\ 96557504.7 102826315.7 

 

in the case of a Balloon Payment or Principal Prepayment, the amount of such Balloon Payment or Principal Prepayment, as applicable (other than the amount of such Balloon Payment or Principal Prepayment that will remain in the Release Account after giving effect to such acquisition), (ii) solely to the extent acquired through an exchange (and not with proceeds on deposit in the Release Account), has a Fair Market Value that, when combined with any cash proceeds received (or to be received) in connection with such substitution or such sale, if applicable, and the Fair Market Value of each other commercial real estate property acquired (or to be acquired) by the applicable Issuer in substitution for such Released Mortgaged Property or Released Mortgage Loan or with the proceeds of such sale or such Balloon Payment or Principal Prepayment, as applicable, is equal to or greater than (x) in the case of a Released Mortgaged Property, the Fair Market Value of such Released Mortgaged Property, (y) in the case of a Released Mortgage Loan, the principal balance of such Released Mortgage Loan or (z) in the case of a Balloon Payment or Principal Prepayment, the amount of such Balloon Payment or Principal Prepayment, as applicable (other than the amount of such Balloon Payment or Principal Prepayment that will remain in the Release Account after giving effect to such acquisition), (iii) solely to the extent acquired through an exchange (and not with proceeds on deposit in the Release Account), has a Collateral Value that, when combined with any cash proceeds received (or to be received) in connection with such substitution or such sale, if applicable, and the Collateral Value of each other commercial real estate property acquired (or to be acquired) by the Issuer in substitution for such Released Mortgaged Property or Released Mortgage Loan or with the proceeds of such sale or such Balloon Payment or Principal Prepayment, as applicable, is equal to or greater than (x) in the case of a Released Mortgaged Property, the Collateral Value of such Released Mortgaged Property, (y) in the case of a Released Mortgage Loan, the principal balance of such Released Mortgage Loan or (z) in the case of a Balloon Payment or Principal Prepayment, the amount of such Balloon Payment or Principal Prepayment, as applicable (other than the amount of such Balloon Payment or Principal Prepayment that will remain in the Release Account after  giving effect to such acquisition), (iv) subject to any exceptions with respect to which the Rating Condition is satisfied or the Requisite Global Majority has consented, such Issuer has obtained from an Originator or itself has made, (A) with respect to any such commercial real estate property acquired in substitution for a Released Mortgaged Property, either (x) all of the representations and warranties originally made with respect to such Released Mortgaged Property or (y) all of the representations and warranties required to be made with respect to commercial real estate loans contemplated by Section 2.19 of the Indenture for Mortgaged Properties or (B) with respect to any such commercial real estate property acquired with the proceeds of any Balloon Payment or Principal Prepayment of a Mortgage Loan, all of the representations and warranties required to be made with respect to commercial real estate loans contemplated by Section 2.19 of the Indenture for Mortgaged Properties (in each case, with each date therein referring to, unless otherwise expressly stated, the date of such acquisition), (v) in the event that such commercial real estate property were included as a Mortgaged Property in the Collateral Pool as of the end of the Collection Period preceding the Collection Period in which such acquisition occurs, it would not have lowered the weighted average of the FCCR for all Mortgaged Properties in the Collateral Pool and all Mortgaged Properties securing Mortgage Loans in the Collateral Pool, based upon the most recent determination of each such FCCR by the Property Manager (weighted based on the Allocated Loan Amount of each such Mortgaged Property); provided, however, with respect to no more than 10% of the Aggregate Collateral Value in any Closing Date Period (determined as of the                                     24 US-DOCS\ 96557504.7 102826315.7 

 

applicable Starting Closing Date), such Qualified Substitute Mortgaged Properties will not be subject to the weighted average FCCR criteria set forth in this clause (v), but instead will be required to have a minimum FCCR of 2.5 (measured as of the date of each respective substitution); provided, further, that with respect to no more than 5% of the Aggregate Collateral Value in any Closing Date Period, such Qualified Substitute Mortgaged Properties will not be subject to the weighted average FCCR or minimum FCCR criteria set forth in this clause (v) so long as the Tenant under the related Lease (or any related Guarantor) has an investment grade rating from S&P, Moody’s or Fitch Ratings, Inc., -(vi) in the event that any lease relating to such commercial real estate property were included as a “Lease” in the Collateral Pool as of the end of the Collection Period preceding the Collection Period in which such acquisition occurs, it would not have lowered the weighted average of the Monthly Lease Payments for all Leases in the Collateral Pool and all leases relating to Mortgaged Properties securing Mortgage Loans in the Collateral Pool (weighted based on the Allocated Loan Amount of each such Mortgaged Property) ; provided, however, that any such leases included as “Leases” in the Collateral Pool may reduce the weighted average of the Monthly Lease Payments for all Leases in the Collateral Pool by no more than 2.5% in the aggregate for all such leases in any Closing Date Period , (vii) in the event that any lease relating to such commercial real estate property were included as a “Lease” in the Collateral Pool as of the end of the Collection Period preceding the Collection Period in which such acquisition occurs, it would not have lowered the weighted average of the remaining lease term for all Leases in the Collateral Pool and all Leases relating to Mortgaged Properties securing Mortgage Loans in the Collateral Pool (weighted based on the Allocated Loan Amount of each such Mortgaged Property) ; provided, however, that any such leases included as “Leases” in the Collateral Pool may reduce the weighted average of the remaining lease term for all Leases in the Collateral Pool by no more than 3 months in the aggregate for all such leases in any Closing Date Period , (viii) if the tenant thereof or any third party has an option to purchase such commercial real estate property, the contractual amount of such option price is no less than what the Allocated Loan Amount of such commercial real estate property would be after giving effect to such acquisition, (ix) has been approved in writing by the Support Provider, (x) is either (x)  leased pursuant to a “triple net” lease or (y) leased pursuant to a “double  net” lease and (xi) has an appraisal that meets the applicable requirements set forth in the definition of “Appraised Value.” If one or more of the foregoing criteria are not met, such commercial real estate property will be a Qualified Substitute Mortgaged Property if the Qualified Substitute Mortgaged Property Waiver Criteria are satisfied with respect to such commercial real estate property.        “Qualified Substitute Mortgaged Property Waiver Criteria ”: Means criteria that will be satisfied with respect to any commercial real estate property in the event that: (1) the Special Servicer considers the acquisition by the applicable Issuer of such commercial real estate property to be in the interest of the Noteholders and (2) either (x) the Rating Condition is satisfied in connection with such acquisition or (y) both (A) the Rating Agency Notification Condition is satisfied in connection with such acquisition and (B) after giving effect to such acquisition, the aggregate Collateral Values (determined as of the date of acquisition by the applicable Issuer) of all commercial real estate properties acquired pursuant to this clause (2)(y) and all commercial real estate loans acquired pursuant to clause (2)(y) of the Qualified Substitute Mortgage Loan Waiver Criteria, in each case during the Closing Date Period in which such                                      25 US-DOCS\ 96557504.7 102826315.7 

 

acquisition occurs, will not exceed 5.0% of the Aggregate Collateral Value (determined as of the Starting Closing Date with respect to such Closing Date Period).        “Qualified Substitute Protective Mortgage Loan ”: Means any Protective Mortgage Loan that (i) is secured by one or more Mortgaged Properties that would constitute a Qualified Substitute Mortgaged Property (other than any requirements set forth in clauses (iii) and (vii) of the definition thereof) in the event that it (or they) were exchanged by an Issuer for the Released Mortgaged Property (it being understood that, for the purposes of this clause (i), the Collateral Value of each such Mortgaged Property shall be determined in accordance with clause (i) of the definition of “Collateral Value” as if it did not secure a Mortgage Loan), (ii) has an unpaid principal balance that, when combined with any cash proceeds received (or to be received) in connection with the substitution or sale of the applicable Released Mortgaged Property, if applicable, and the principal balance of each other commercial real estate loan or commercial real estate property acquired (or to be acquired) by the applicable Issuer in substitution for such Released Mortgaged Property or with the proceeds of such sale or substitution, is not less than the Collateral Value of such Released Mortgaged Property, (iii) with respect to which, subject to any exceptions with respect to which the Rating Condition is satisfied or the Requisite Global Majority has consented, the applicable Issuer has obtained from an Originator or itself has made, all of the representations and warranties required to be made for Mortgage Loans pursuant to Section 2.19 of the Indenture (with each date therein referring to, unless otherwise expressly stated, the date of such acquisition) and (iv) has been approved in writing by the Support Provider.        “Rating Agency ”: As defined in the Indenture.        “Rating Agency Notification Condition ”: As defined in the Indenture.        “Rating Condition ”: As defined in the Indenture.        “Re-Appraised Value : With respect to each Mortgaged Property that is the subject of a Global Appraisal Event, the Appraised Value that is determined with respect to such Mortgaged Property in connection with such Global Appraisal Event. In the event that multiple Global Appraisal Events occur with respect to the same Mortgaged Property, the Appraised Value determined with respect to the most recent Global Appraisal Event shall constitute the Re- Appraised Value of such Mortgaged Property.        “Reimbursement Rate ”: The rate per annum applicable to the accrual of Advance Interest, which rate per annum is equal to the Prime Rate plus 2.0%.        “Release ”: As defined in Section 7.01(a) .        “Release Account ”: As defined in Section 3.04(b) .        “Release Parcel ”: With respect to the Post-Closing Properties identified as Buehler’s Food Market (1055 Sugarbush Drive) and Buehler’s Food Market (3540 Burbank Road), an undeveloped portion of each such property that (i) was not considered in determining the purchase price thereof paid by the Originator with respect thereto and (ii) is subject to an option                                     26 US-DOCS\ 96557504.7 102826315.7 

 

on the part of the related Tenant permitting such Tenant to subdivide and reacquire such undeveloped portion for a nominal amount.        “Release Price ”: As defined in Section 7.01(b) .        “Remaining Parcel ”: As defined in Section 7.01(a) .        “Relinquished Property ”: Any Mortgaged Property qualifying as “relinquished property” within the meaning of Section 1.1031(k)-(1(a) of the Treasury Regulations (or any successor section).        “Relinquished Property Agreement ”: Any agreement relating to the sale or disposition of Relinquished Property.        “Relinquished Property Proceeds ”: means the proceeds of the sale or disposition of Relinquished Property.        “Remittance Date ”: The Business Day preceding each Payment Date.        “Removed Mortgaged Property ”: Each Third Party Option Mortgaged Property and each Lease Transfer Mortgaged Property, released at any time from the lien of the Indenture.        “REO Acquisition ”: The acquisition of any REO Property pursuant to Section 3.09 .        “REO Disposition ”: The sale or other disposition of any REO Property pursuant to Section 3.18 .        “REO Property ”: A Mortgaged Property acquired by or on behalf of the Indenture Trustee through foreclosure, acceptance of a deed-in-lieu of foreclosure or otherwise in accordance with applicable law in connection with the default or imminent default of a Mortgage Loan.        “REO Revenues ”: All income, rents, profits and proceeds derived from the ownership, operation or leasing of any REO Property.         “ Replacement Property ”: Mortgaged Properties that are (i) of a “like-kind” (within the meaning of Section 1.1031(a)-1(b) of the Treasury Regulations (or any successor section)) to any Relinquished Property and otherwise satisfying the definition of and requirements for “replacement property” under the Treasury Regulations and (ii) satisfy the definition of Qualified Substitute Mortgaged Property.        “Replacement Property Agreement ”: Any agreement relating to the acquisition of Replacement Property.        “Request for Release ”: A request signed by a Servicing Officer, as applicable, of the Property Manager substantially in the form of Exhibit B  attached hereto or of the Special Servicer substantially in the form of Exhibit C  attached hereto.                                     27 US-DOCS\ 96557504.7 102826315.7 

 

      “Requisite Global Majority ”: As defined in the Indenture.        “Responsible Officer ”: As defined in the Indenture.        “Restaurant Concept ”: With respect to any properties operated within the Restaurants Business Sector, any chain of properties that share substantially the same characteristics.        “S&P ”: Standard & Poor’s Rating Services, a division of The McGraw-Hill Companies, Inc.        “Series ”: As defined in the Indenture.        “Series 2014-1 Supplement ”: The Series 2014-1 Supplement to the Indenture, dated as of the date hereof, among the Issuers and the Indenture Trustee, as amended, supplemented or modified from time to time.        “Series 2017-1 Supplement ”: The Series 2017-1 Supplement to the Indenture, dated as of the Series 2017-1 Closing Date, among the Issuers and the Indenture Trustee, as amended, supplemented or modified from time to time.        “Series Account : As defined in the Indenture.        “Servicer Replacement Event ”: The meaning specified in Section 6.01(a) .        “Servicing Account ”: The segregated account or accounts created and maintained pursuant to Section 3.03(a) .        “Servicing Fees ”: With respect to each Mortgage Loan, Mortgaged Property and Lease, the Property Management Fee, the Back-Up Fee, the Special Servicing Fee, if any, and the Additional Servicing Compensation, if any.        “Servicing File ”: Any documents (other than documents required to be part of the related Loan File or Lease File) in the possession of the Property Manager or the Special Servicer and relating to the origination and servicing of any Mortgage Loan or Lease or the administration of any Mortgaged Property (including copies of all applicable Property Insurance Policies with respect thereto).        “Servicing Officer ”: Any officer or employee of the Property Manager or the Special Servicer, as applicable, involved in, or responsible for, the administration, management and servicing of the Mortgage Loans, Mortgaged Properties and Leases, whose name and specimen signature appear on the list of servicing officers furnished, from time to time, by such party to the applicable Issuers and the Indenture Trustee.        “Servicing Standard ”: To provide property management services for the Mortgaged Properties and to service and special service the Mortgage Loans and Leases on behalf of the applicable Issuers in accordance with applicable law, the terms of this Agreement, the terms of the respective Mortgage Loans and Leases and, to the extent consistent with the foregoing, (x) in the same manner in which, and with the same care, skill, prudence and diligence with which, the                                     28 US-DOCS\ 96557504.7 102826315.7 

 

Property Manager or the Special Servicer, as the case may be, (a) services and administers similar mortgage loans, leases and mortgaged properties for other third party portfolios or (b) administers similar mortgage loans, leases and mortgaged properties for its own account or (y) in a manner normally associated with the servicing and administration of similar properties, whichever standard is highest, in all cases taking into account the best interests of the Noteholders and taking into consideration the maximization of revenue, but without regard to: (i) any known relationship that the Property Manager or Special Servicer, or an Affiliate of the Property Manager or Special Servicer, may have with any Issuer, any Originator, the Support Provider, any Tenant, any Borrower, any of their respective Affiliates or any other party to the Transaction Documents; (ii) the ownership of any Note or LLC Interest by the Property Manager or Special Servicer or any Affiliate of the Property Manager or Special Servicer, as applicable; (iii) the Property Manager’s obligation to make Advances, to incur servicing expenses or to withdraw (or, in the event the Property Manager is Spirit Realty, to direct the Indenture Trustee to withdraw) funds from the Collection Account to pay Emergency Property Expenses with respect to the Mortgage Loans, the Leases or the Mortgaged Properties; (iv) the Property Manager’s or Special Servicer’s right to receive compensation for its services or reimbursements of the costs under this Agreement; (v) the ownership, servicing or management for others, by the Property Manager, the Special Servicer or any Originator or other Affiliate of any other leases or property; (vi) the repurchase and indemnification obligations of the Originators or Support Provider; or (vii) the existence of any loans made to a Tenant by the Property Manager, the Special Servicer or Spirit Realty or any Affiliate of the Property Manager, the Special Servicer or Spirit Realty.        “Servicing Transfer Event ”: With respect to any Mortgaged Property, the occurrence of any of the events described in clauses (a) through (e) of the definition of “Specially Serviced Lease.” With respect to any Mortgage Loan, the occurrence of any of the events described in clauses (a) through (e) of the definition of “Specially Serviced Loan.”        “Special Servicer ”: Spirit Realty, in its capacity as special servicer under this Agreement, or any successor special servicer appointed as herein provided.        “Special Servicer Additional Servicing Compensation ”: As defined in Section  3.11(d) .        “Special Servicer Report ”: As defined in Section 4.01(b) .        “Special Servicing Fee ”: With respect to each Specially Serviced Asset, the fee designated as such and payable to the Special Servicer pursuant to the first paragraph of Section 3.11(c) .        “Special Servicing Fee Rate ”: With respect to each Specially Serviced Asset, a fixed percentage rate equal to 0.75% per annum.        “Specially Serviced Asset ”: A Specially Serviced Lease or a Specially Serviced Loan.        “Specially Serviced Lease ”: Any Lease as to which any of the following events occurs or exists:                                      29 US-DOCS\ 96557504.7 102826315.7 

 

      (i)  any Monthly Lease Payment becomes delinquent for 60 or more consecutive days;        (ii) the Property Manager determines in its good faith and reasonable judgment that a            default in making a Monthly Lease Payment is likely to occur within 30 days and            is not likely to be remedied for 60 days;        (iii) the Property Manager receives written notice from the Tenant indicating that such            Tenant cannot make future Monthly Lease Payments or requesting a reduction in            the amount of its Monthly Lease Payments;        (iv) a default (other than as described in clause (a) above) occurs that materially and            adversely affects the interests of the Issuers and that continues unremedied for the            applicable grace period under the terms of the Lease (or, if no grace period is            specified, for 30 days); or        (v)  the related Tenant becomes insolvent, readjusts its debt, is subject to marshaling            of assets and liabilities, or similar proceedings in respect of the related Tenant            occur, or as to which the related Tenant (in the good faith and reasonable            judgment of the Property Manager) takes actions indicating its insolvency or its            inability to pay its obligations or the Property Manager or the Special Servicer            receives notice of commencement of foreclosure or similar proceedings with            respect to the related Mortgaged Property.        “Specially Serviced Lease Trigger Event ”: Each of the circumstances identified in clauses (a) through (e) of the definition of the term “Specially Serviced Lease”.        “Specially Serviced Loan” : Any Mortgage Loan as to which any of the following events has occurred:        (i)  any Monthly Loan Payment becomes delinquent for 60 or more consecutive days;        (ii) the Property Manager determines in its good faith and reasonable judgment that a            default in making a Monthly Loan Payment is likely to occur within 30 days and is            not likely to be remedied for 60 days;        (iii) the Property Manager receives written notice from the Borrower indicating that            such Borrower cannot make future Monthly Loan Payments or requesting a            reduction in the amount of its payment;        (iv) a default (other than as described in clause (a) above) occurs that materially and            adversely affects the interests of the Issuers and that continues unremedied for the            applicable grace period under the terms of the Mortgage Loan (or, if no grace            period is specified, for 30 days); or        (v)  the related Borrower becomes insolvent, readjusts its debt, is subject to            marshaling of assets and liabilities, or similar proceedings in respect of the related            Borrower occur, or as to which the related Borrower (in the good faith and            reasonable judgment of the Property Manager) takes actions indicating its                                     30 US-DOCS\ 96557504.7 102826315.7 

 

           insolvency or its inability to pay its obligations or the Property Manager or the            Special Servicer receives notice of commencement of foreclosure or similar            proceedings with respect to the related Mortgaged Property.        “Specially Serviced Loan Trigger Event ”: Each of the circumstances identified in clauses (a) through (e) of the definition of the term “Specially Serviced Loan”.        “Specified Permitted Subdivision ”: With respect to each Post-Closing Property containing a Release Parcel, the subdivision of such Mortgaged Property to permit the transfer of the Release Parcel to the related Tenant.        “Specified Permitted Subdivision Conditions ”: As defined in Section 7.01(a).        “Spin-Off ”: A transaction whereby Spirit Realty (or its parent) will “spin-off” certain of its real estate assets, including the Issuers and the Collateral Pool.        “Spirit MTA ”: Spirit MTA REIT, a Maryland real estate investment trust, and its successors and assigns.        “Spirit Realty ”: Spirit Realty, L.P., a Delaware limited partnership, and its successors and assigns.        “Spirit SPE ”: Any special purpose, bankruptcy remote subsidiary (direct or indirect) of Spirit Realty.        “Starting Closing Date ”: With respect to any Closing Date Period, the Series Closing Date upon which such Closing Date Period commences .        “Sub-Manager ”: Any Person with which the Property Manager or the Special Servicer has entered into a Sub-Management Agreement.        “Sub-Management Agreement ”: The written contract between the Property Manager or the Special Servicer, on the one hand, and any Sub-Manager, on the other hand, relating to servicing and administration of Mortgage Loans, Leases and Mortgaged Properties, as provided in Section 3.21 , as may be amended, supplemented or otherwise modified.        “Successor Property Manager ”: As defined in Section 6.01(b).        “Successor Replacement Date ”: As defined in Section 6.01(b).        “Successor Special Servicer ”: As defined in Section 6.01(b) .        “Support Provider ”: Spirit Realty or any successor support provider.        “Support Provider SPE ”: Any special purpose, bankruptcy remote subsidiary (direct or indirect) of the Support Provider.                                      31 US-DOCS\ 96557504.7 102826315.7 

 

       “ Sweep Period ”: As defined in the Indenture.        “Taxable REIT Subsidiary ” With respect to Spirit Realty, an Affiliate thereof that is a “taxable REIT subsidiary” under the Code.        “Tenant ”: With respect to each Lease, the tenant under such Lease and any successor or assign thereof.        “Terminated Lease Property ”: A Mortgaged Property, with respect to which (a) the related Lease has expired, has been terminated or has been rejected in a bankruptcy, insolvency or similar proceeding of the Tenant, (b) the related Tenant has notified the Property Manager or the applicable Issuer of its intent to not renew such Lease within 24 months of the termination date of the related Lease or (c) the related Tenant has otherwise failed to comply with the procedures for renewal under the terms of the related Lease (including, but not limited to, any notice provisions relating to renewal of the Lease); provided  solely in the case of an expiration, termination or rejection as described in clause (a), the Property Manager has used commercially reasonable efforts to renew such Lease or obtain a new Lease of such Mortgaged Property.        “Third Party Option Expenses ”: Any reasonable out-of-pocket costs and expenses (but not internal costs and expenses) incurred by the Issuers (or Property Manager or Special Servicer, as applicable, on behalf of the Issuers) in connection with the exercise of a Third Party Purchase Option with respect to the applicable Mortgaged Property; provided , that such costs and expenses shall not exceed $50,000 with respect to any single Mortgaged Property.        “Third Party Option Mortgaged Property ”: As defined in Section 7.02(a) .        “Third Party Option Price ”: A cash price equal to (i) the amount specified in a related Lease, Lease Document or other agreement, as payable by a Tenant or any other Person in connection with the exercise of a Third Party Purchase Option minus (ii) the Third Party Option Expenses in connection with such exercise.        “Third Party Purchase Option ”: An option of a Tenant or any other Person under or in connection with a Lease, Lease Documents or other related agreements to purchase the related Mortgaged Property before or at the expiration of the Lease term.        “Title Company ”: As defined in Section 2.03(a).        “Title Insurance Policies ”: As defined in Section 2.03(a).        “Total Debt Service ”: As defined in the Indenture.        “Transfer Date ”: The date on which a Mortgage Loan or Mortgaged Property is acquired by the applicable Issuer.        “Treasury Regulations ” Any treasury regulations relating to like-kind exchanges and Section 1031 of the Code (or any successor section thereof).                                      32 US-DOCS\ 96557504.7 102826315.7 

 

      “Unscheduled Principal Payment ”: On any Payment Date, the sum of (a) the Unscheduled Proceeds deposited into the Collection Account during the Collection Period relating to such Payment Date plus (b) any Purchase Option Deficiency arising during such Collection Period, together with any Purchase Option Deficiency from any prior Payment Date or related Collection Period with respect to which Available Amounts were not allocated to any Series pursuant to Section 2.11(b) the Indenture.        “Unscheduled Proceeds ”: Collectively, Liquidation Proceeds, Condemnation Proceeds, Property Insurance Proceeds, Principal Prepayments, Release Prices, Balloon Payments, Purchase Premiums and Exchange Cash Collateral; provided , however , that any amounts which are on deposit in the Release Account or the Exchange Reserve Account shall not be deemed Unscheduled Proceeds until such amounts have been transferred to the Collection Account.        “Uniform Commercial Code ”: The Uniform Commercial Code as in effect in any applicable jurisdiction.        “Workout Fee ”: With respect to each Corrected Loan and each Corrected Lease, the fee payable to the Special Servicer pursuant to Section 3.11(f) .        “Workout Fee Rate ”: With respect to each Corrected Loan and each Corrected Lease, a fixed percentage rate equal to 0.50%.        Section 1.02 Other Definitional Provisions .        (a)  All terms defined in this Agreement shall have the defined meanings when used in any certificate or other document made or delivered pursuant hereto unless otherwise defined therein.        (b)  As used in this Agreement and in any certificate or other document made or delivered pursuant hereto or thereto, accounting terms not defined in this Agreement or in any such certificate or other document, and accounting terms partly defined in this Agreement or in any such certificate or other document, to the extent not defined, shall have the respective meanings given to them under GAAP. To the extent that the definitions of accounting terms in this Agreement or in any such certificate or other document are inconsistent with the meanings of such terms under GAAP, the definitions contained in this Agreement or in any such certificate or other document shall control.        (c)  The words “hereof,” “herein,” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement; Section and Exhibit references contained in this Agreement are references to Sections and Exhibits in or to this Agreement unless otherwise specified; a reference to a subsection or other subdivision without further reference to a Section is a reference to such subsection or other subdivision as contained in the Section in which the reference appears; and the words “include” and “including” shall mean without limitation by reason of enumeration.                                      33 US-DOCS\ 96557504.7 102826315.7 

 

      (d)  The definitions contained in this Agreement are applicable to the singular as well as the plural forms of such terms and to the masculine as well as the feminine and neuter genders of such terms.        (e)  Any agreement, instrument or statute defined or referred to herein or in any instrument or certificate delivered in connection herewith means such agreement, instrument or statute as from time to time amended, modified or supplemented and includes (in the case of agreements or instruments) references to all attachments thereto and instruments incorporated therein; references to a Person are also to its permitted assignees.        Section 1.03 Certain Calculations in Respect of the Leases and the Mortgage Loans .        (a)  All amounts collected in respect of any Lease in the form of payments from the related Tenants, Guaranties, Property Insurance Proceeds or otherwise shall be applied to amounts due and owing under the Lease in accordance with the express provisions of such Lease, and all amounts collected in respect of any Mortgage Loan in the form of payments from the related Borrower, Guaranties, Liquidation Proceeds or Property Insurance Proceeds shall be applied to amounts due and owing under the related Mortgage Note and Mortgage (including for principal and accrued and unpaid interest) in accordance with the express provisions of the related Mortgage Note and Mortgage; in the absence of such express provisions, all amounts collected shall be applied for purposes of this Agreement: (i) with respect to amounts collected in respect to any Lease, first , as a recovery of any related and unreimbursed Property Protection Advances, and second , in accordance with the Servicing Standard, but subject to Section 1.03(c) , as a recovery of any other amounts then due and owing under such Lease, including, without limitation, Additional Rent and Default Interest; and (ii) with respect to amounts collected in respect of any Mortgage Loan, first , as a recovery of any related and unreimbursed Property Protection Advances, second , as a recovery of accrued and unpaid interest at the related Interest Rate on such Mortgage Loan to but not including, as appropriate, the date of receipt or the Due Date in the Collection Period of receipt, third , as a recovery of principal of such Mortgage Loan then due and owing, including by reason of acceleration of the Mortgage Loan following a default thereunder (or, if a liquidation event has occurred in respect of such Mortgage Loan, a recovery of principal to the extent of its entire remaining unpaid principal balance), fourth , as a recovery of any Prepayment Consideration Payment then due and owing under such Mortgage Loan, fifth , in accordance with the Servicing Standard, but subject to Section 1.03(c) , as a recovery of any other amounts then due and owing under such Mortgage Loan, including Default Interest, and sixth , as a recovery of any remaining principal of such Mortgage Loan to the extent of its entire remaining unpaid principal balance. Any proceeds derived from an unleased Mortgaged Property (exclusive of related operating costs, including reimbursement of Property Protection Advances made by the Property Manager or the Back-Up Manager in connection with the operation and disposition of such Mortgaged Property) shall be applied by the Property Manager in the same manner as if they were Monthly Lease Payments due on the previously existing Lease for such Mortgaged Property until such Lease becomes a Liquidated Lease pursuant to the terms of such Lease and the related Lease Documents.        (b)  Collections in respect of each REO Property (exclusive of amounts to be applied to the payment of the costs of operating, managing, maintaining and disposing of such REO Property) shall be treated: first , as a recovery of any related and unreimbursed Property                                     34 US-DOCS\ 96557504.7 102826315.7 

 

Protection Advances; second , as a recovery of accrued and unpaid interest on the related Mortgage Loan at the related Interest Rate to but not including the Due Date in the Collection Period of receipt; third , as a recovery of principal of the related Mortgage Loan to the extent of its entire unpaid principal balance; and fourth , in accordance with the Servicing Standard, but subject to Section 1.03(c) , as a recovery of any other amounts deemed to be due and owing in respect of the related Mortgage Loan.        (c)  Insofar as amounts received in respect of any Lease, Mortgage Loan or REO Property which are allocable to fees and charges owing in respect of such Lease, Mortgage Loan or REO Property which constitute Additional Servicing Compensation payable to the Property Manager or Special Servicer are insufficient to cover the full amount of such fees and charges, such amounts shall be allocated between such of those fees and charges as are payable to the Property Manager, on the one hand, and as are payable to the Special Servicer, on the other, pro rata  in accordance with their respective entitlements with respect to such Lease, Mortgage Loan or REO Property.        (d)  The foregoing applications of amounts received in respect of any Lease, Mortgage Loan or REO Property shall be determined by the Property Manager and reflected in the appropriate monthly Determination Date Report and any Modified Collateral Detail and Realized Loss Report.        (e)  Notwithstanding the early termination of any Lease resulting from a default by the related Tenant, such Lease will be treated for purposes of determining Servicing Fees and Indenture Trustee Fees as remaining in effect until such Lease becomes a Liquidated Lease.        Section 1.04 Fee Calculations; Interest Calculations.        (a)  The calculation of the Servicing Fees shall be made in accordance with Section 3.11 . All dollar amounts calculated hereunder shall be rounded to the nearest penny with one-half of one penny being rounded up.        (b)  The amount of interest accrued on each Mortgage Loan during any Interest Accrual Period will be calculated in arrears based on the terms specified in the related Mortgage Documents.                                   ARTICLE II   REPRESENTATIONS AND WARRANTIES; RECORDINGS AND FILINGS; BOOKS AND      RECORDS; DEFECT, BREACH, CURE, REPURCHASE AND SUBSTITUTION;                          FINANCIAL COVENANTS        Section 2.01 Representations and Warranties of the Property Manager and the Back-Up Manager .                                      35 US-DOCS\ 96557504.7 102826315.7 

 

      (a)  The Property Manager represents and warrants to the other parties hereto, and for the benefit of the Issuers, the Indenture Trustee on behalf of the Noteholders, as of each Series Closing Date:             (i)   The Property Manager is a limited partnership duly organized, validly       existing, and in good standing under the laws of the State of Delaware and is in       compliance with the laws of each state (within the United States of America) in which any       Mortgaged Property is located to the extent necessary to its performance under this       Agreement;             (ii)  The execution and delivery of this Agreement by the Property Manager,       and the performance and compliance with the terms of this Agreement by the Property       Manager, do not violate its organizational documents or constitute an event that, with       notice or lapse of time, or both, would constitute a default under, or result in the breach       of, any material agreement or other instrument to which it is a party or by which it is       bound;             (iii) The Property Manager has the power and authority to enter into and       consummate all transactions to be performed by it contemplated by this Agreement, has       duly authorized the execution, delivery and performance by it of this Agreement, and has       duly executed and delivered this Agreement;             (iv)  This Agreement, assuming due authorization, execution and delivery by       each of the other parties hereto, constitutes a valid, legal and binding obligation of the       Property Manager, enforceable against the Property Manager in accordance with the       terms hereof (except as such enforceability may be limited by bankruptcy, insolvency,       fraudulent conveyance, reorganization, moratorium and other similar laws affecting       creditors’ rights generally or by general equitable principles, whether considered in a       proceeding at law or in equity and by an implied covenant of good faith and fair dealing);             (v)   The Property Manager is not in violation of, and its execution and delivery       of this Agreement and its performance and compliance with the terms of this Agreement       will not constitute a violation of, any law, any order or decree of any court or arbiter, or       any order, regulation or demand of any federal, state or local governmental or regulatory       authority, which violation is likely to affect materially and adversely either the ability of       the Property Manager to perform its obligations under this Agreement or the financial       condition of the Property Manager;             (vi)  No litigation is pending or, to the Property Manager’s knowledge,       threatened against the Property Manager that is reasonably likely to be determined       adversely to the Property Manager and, if determined adversely to the Property Manager,       would prohibit the Property Manager from entering into this Agreement or that, in the       Property Manager’s good faith and reasonable judgment, is likely to materially and       adversely affect either the ability of the Property Manager to perform its obligations       under this Agreement or the financial condition of the Property Manager;                                      36 US-DOCS\ 96557504.7 102826315.7 

 

           (vii) No consent, approval, authorization or order under any court or       governmental agency or body is required for the execution, delivery and performance by       the Property Manager of, or the compliance by the Property Manager with, this       Agreement or the consummation of the transactions of the Property Manager       contemplated by this Agreement, except for any consent, approval, authorization or order       that has been obtained or that if not obtained would not have a material and adverse       effect on the ability of the Property Manager to perform its obligations hereunder; and             (viii) Each officer and employee of the Property Manager that has       responsibilities concerning the management, servicing and administration of Mortgaged       Properties, Leases and Mortgage Loans is covered by errors and omissions insurance and       the fidelity bond as and to the extent required by Section 3.07(c) .        (b)  The representations and warranties of the Property Manager set forth in Section 2.01(a)  shall survive the execution and delivery of this Agreement and shall inure to the benefit of the Persons to whom and for whose benefit they were made until all amounts owed to the Noteholders under or in connection with this Agreement, the Indenture and the Notes have been indefeasibly paid in full. Upon discovery by any party hereto of any breach of any of the foregoing representations and warranties, the party discovering such breach shall give prompt written notice to the other parties.        (c)  Any successor Property Manager or Special Servicer shall be deemed to have made, as of the date of its succession, each of the representations and warranties set forth in Section 2.01(a) , subject to such appropriate modifications to the representation and warranty set forth in Section 2.01(a)(i)  to accurately reflect such successor’s jurisdiction of organization and whether it is a corporation, partnership, bank, association or other type of organization.        (d)  The Back-Up Manager represents and warrants to the other parties hereto, and for the benefit of the Issuers and the Indenture Trustee on behalf of the Noteholders, as of each Series Closing Date:             (i)   The Back-Up Manager is a national banking association duly organized,       validly existing, and in good standing under the laws of the United States of America and       is in compliance with the laws of each state (within the United States of America) in       which any Mortgaged Property is located to the extent necessary to its performance       under this Agreement;             (ii)  The execution and delivery of this Agreement by the Back-Up Manager,       and the performance and compliance with the terms of this Agreement by the Back-Up       Manager, do not violate its organizational documents or constitute an event that, with       notice or lapse of time, or both, would constitute a default under, or result in the breach       of, any material agreement or other instrument to which it is a party or by which it is       bound;             (iii) The Back-Up Manager has the corporate power and authority to enter into       and consummate all transactions to be performed by it contemplated by this Agreement,                                      37 US-DOCS\ 96557504.7 102826315.7 

 

      has duly authorized the execution, delivery and performance by it of this Agreement, and       has duly executed and delivered this Agreement;             (iv)  This Agreement, assuming due authorization, execution and delivery by       each of the other parties hereto, constitutes a valid, legal and binding obligation of the       Back-Up Manager, enforceable against the Back-Up Manager in accordance with the       terms hereof (except as such enforceability may be limited by bankruptcy, insolvency,       fraudulent conveyance, reorganization, moratorium and other similar laws affecting       creditors’ rights generally or by general equitable principles, whether considered in a       proceeding at law or in equity and by an implied covenant of good faith and fair dealing);             (v)   The Back-Up Manager is not in violation of, and its execution and delivery       of, this Agreement and its performance and compliance with the terms of this Agreement       will not constitute a violation of, any law, any order or decree of any court or arbiter, or       any order, regulation or demand of any federal, state or local governmental or regulatory       authority, which violation is likely to affect materially and adversely either the ability of       the Back-Up Manager to perform its obligations under this Agreement or the financial       condition of the Back-Up Manager;             (vi)  No litigation is pending or, to the Back-Up Manager’s knowledge,       threatened against the Back-Up Manager that is reasonably likely to be determined       adversely to the Back-Up Manager and, if determined adversely to the Back-Up       Manager, would prohibit the Back-Up Manager from entering into this Agreement or       that, in the Back-Up Manager’s good faith and reasonable judgment, is likely to       materially and adversely affect either the ability of the Back-Up Manager to perform its       obligations under this Agreement or the financial condition of the Back-Up Manager;             (vii) No consent, approval, authorization or order under any court or       governmental agency or body is required for the execution, delivery and performance by       the Back-Up Manager of, or the compliance by the Back-Up Manager with, this       Agreement or the consummation of the transactions contemplated by the Back-Up       Manager by this Agreement, except for any consent, approval, authorization or order that       has been obtained or that if not obtained would not have a material and adverse effect on       the ability of the Back-Up Manager to perform its obligations hereunder; and             (viii) Each officer and employee of the Back-Up Manager that has       responsibilities concerning the management, servicing and administration of the       Mortgaged Properties, Leases and Mortgage Loans is covered by errors and omissions       insurance and the fidelity bond as and to the extent required by Section 3.07(c) .        Section 2.02 Representations and Warranties of the Issuers .        (a)  Each Issuer hereby represents and warrants to each of the other parties hereto and for the benefit of the Indenture Trustee, on behalf of the Noteholders as of each Series Closing Date on or after the date on which such Issuer becomes a party to this Agreement:                                      38 US-DOCS\ 96557504.7 102826315.7 

 

           (i)   Such Issuer is a limited liability company duly organized, validly existing,       and in good standing under the laws of the State of Delaware and is in compliance with       the laws of each state (within the United States of America) in which any applicable       Mortgaged Property is located to the extent necessary for the Issuer to perform its       obligations under this Agreement;             (ii)  The execution and delivery by such Issuer of this Agreement and the       consummation by such Issuer of the transactions provided for in this Agreement have       been duly authorized by all necessary action on the part of the Issuer;             (iii) The execution and delivery of this Agreement by such Issuer, and the       performance and compliance with the terms of this Agreement by such Issuer, do not       violate its organizational documents or constitute an event that, with notice or lapse of       time, or both, would constitute a default under, or result in the breach of, any material       agreement or other instrument to which it is a party or by which it is bound;             (iv)  Such Issuer has the limited liability company power and authority to enter       into and consummate all transactions to be performed by it contemplated by this       Agreement, has duly authorized the execution, delivery and performance by it of this       Agreement and any applicable Joinder Agreement, and has duly executed and delivered       this Agreement and any applicable Joinder Agreement;             (v)   This Agreement, assuming due authorization, execution and delivery by       each of the other parties hereto, constitutes a valid, legal and binding obligation of such       Issuer, enforceable against such Issuer in accordance with the terms hereof (except as       such enforceability may be limited by bankruptcy, insolvency, fraudulent conveyance,       reorganization, moratorium and other similar laws affecting creditors’ rights generally or       by general equitable principles, whether considered in a proceeding at law or in equity       and by an implied covenant of good faith and fair dealing);             (vi)  Such Issuer is not in violation of, and its execution and delivery of, this       Agreement or any applicable Joinder Agreement and its performance and compliance       with the terms of this Agreement will not constitute a violation of, any law, any order or       decree of any court or arbiter, or any order, regulation or demand of any federal, state or       local governmental or regulatory authority, which violation is likely to affect materially       and adversely either the ability of such Issuer to perform its obligations under this       Agreement or the financial condition of such Issuer;             (vii) No litigation is pending or, to such Issuer’s knowledge, threatened against       such Issuer that is reasonably likely to be determined adversely to such Issuer and, if       determined adversely to such Issuer, would prohibit such Issuer from entering into this       Agreement or that, in such Issuer’s good faith and reasonable judgment, is likely to       materially and adversely affect either the ability of such Issuer to perform its obligations       under this Agreement or the financial condition of such Issuer;             (viii) No consent, approval, authorization or order under any court or       governmental agency or body is required for the execution, delivery and performance by                                     39 US-DOCS\ 96557504.7 102826315.7 

 

      such Issuer of, or the compliance by such Issuer with, this Agreement or the       consummation of the transactions of such Issuer contemplated by this Agreement, except       for any consent, approval, authorization or order that has been obtained or that if not       obtained would not have a material and adverse effect on the ability of such Issuer to       perform its obligations hereunder;             (ix)  Each officer and employee of such Issuer that has responsibilities       concerning the management, servicing and administration of the applicable Mortgaged       Properties, Leases and Mortgage Loans is covered by errors and omissions insurance and       the fidelity bond as and to the extent required by Section 3.07(c) ; and             (x)   To such Issuer’s knowledge, each of the Mortgaged Properties owned by       such Issuer or securing a Mortgage Loan owned by such Issuer is a commercial property.        (b)  The representations and warranties of each Issuer set forth in Section 2.02(a)  shall survive the execution and delivery of this Agreement and shall inure to the benefit of the Persons to whom and for whose benefit they were made for so long as such Issuer remains in existence. Upon discovery by any party hereto of any breach of any of the foregoing representations and warranties, the party discovering such breach shall give prompt written notice to the other parties.        Section 2.03 Recordings and Filings; Books and Records .        (a)  In connection with the Grant made by the Issuers to the Indenture Trustee pursuant to the Granting Clause of the Indenture, each Issuer shall cause the delivery of the applicable Lease Files for the Leases and the applicable Loan Files for the applicable Mortgage Loans to the Custodian in accordance with the Custody Agreement for the benefit of the Indenture Trustee in furtherance of such Grant and such Issuer shall cause: (i) with respect to the Mortgaged Properties owned by such Issuer (A) each Mortgage, Financing Statement and continuation statement referred to in the definition of “Lease File” in the Custody Agreement to be submitted to the appropriate Title Company (as defined below) on or before the First Collateral Date with respect thereto for recording or filing, as the case may be, in the appropriate public office for real property records or for Financing Statements, at the expense of such Issuer and (B) each title insurance binder or commitment referred to in the definition of “Lease File” in the Custody Agreement to be issued as a final title insurance policy by the title companies (the “Title Companies ”) issuing the same (the “ Title Insurance Policies ”); and (ii) with respect to the Mortgage Loans owned by such Issuer, promptly (and in any event within 60 days following the applicable First Collateral Date) cause each assignment of Mortgage in favor of the Collateral Agent referred to in clauses (v) and (vi) of the definition of “Loan File” in the Custody Agreement and each Financing Statement on the applicable UCC form in favor of the Collateral Agent referred to in clause (iii) of such definition to be submitted for recording or filing, as the case may be, in the appropriate public office for real property records or for Financing Statements. Each such assignment and each Mortgage shall reflect that, following recording, it should be returned by the public recording office to the Custodian, on behalf of the Indenture Trustee (or to the Property Manager (or its designee), who shall then deliver such recorded document to the Custodian), and each such Financing Statement shall reflect that the file copy thereof should be returned to the Custodian, for the benefit of the Indenture Trustee (or to the                                     40 US-DOCS\ 96557504.7 102826315.7 

 

Property Manager (or its designee), who shall then deliver such filed document to the Custodian) following filing; provided , that in those instances where the public recording office retains the original Mortgage, assignment of Mortgage and assignment of Assignment of Leases, the Property Manager, on behalf of the Indenture Trustee, shall obtain therefrom a certified copy of the recorded original. Each of the Title Companies issuing the Title Insurance Policies shall be instructed by the applicable Issuer to deliver such policies to the Custodian, for the benefit of the Indenture Trustee. The Property Manager, on behalf of the Indenture Trustee, shall use reasonable efforts to diligently pursue with the Title Companies the return of each of the Mortgages, assignments of Mortgage and Financing Statements from the appropriate recording or filing offices and the delivery of the Title Insurance Policies by the related Title Companies. If any such document or instrument is lost or returned unrecorded or unfiled, as the case may be, because of a defect therein, the applicable Issuer shall promptly prepare and cause to be executed a substitute therefor or cure such defect, as the case may be, and thereafter, such Issuer shall cause the same to be duly recorded or filed, as appropriate. The Property Manager shall file any continuation statements necessary to continue the effectiveness of the Financing Statements.        (b)  Each Issuer shall deliver to and deposit with, or cause to be delivered to and deposited with, the Property Manager all documents and records in the possession of such Issuer or any related Originators that relate to the applicable Mortgaged Properties, Leases and Mortgage Loans and that are not required to be a part of a Lease File or a Loan File in accordance with the definition thereof, and the Property Manager shall hold all such documents and records in trust on behalf of the Indenture Trustee (in hard copy or electronic format). The Property Manager’s possession of such documents and records shall be at the will of the related Issuer and the Indenture Trustee for the sole purpose of facilitating the servicing and administration of the applicable Leases, Mortgage Loans and Mortgaged Properties pursuant to this Agreement and such possession by the Property Manager shall be in a custodial capacity only on behalf of the Indenture Trustee. The ownership of such documents and records shall be vested in each Issuer, as applicable, subject to the lien of the Indenture, and the ownership of all documents and records with respect to the applicable Leases, Mortgage Loans and Mortgaged Properties that are prepared by or which come into possession of the Property Manager or the Special Servicer shall immediately vest in such Issuer, subject to the lien of the Indenture, and shall be delivered to and deposited with the Property Manager, in the case of documents or records in the hands of the Special Servicer, and retained and maintained in trust by the Property Manager in such custodial capacity only on behalf of the Indenture Trustee, except as otherwise provided herein. All such documents and records shall be appropriately maintained in a manner to clearly reflect the ownership of such documents and records by the applicable Issuers, subject to the lien of the Indenture, and that such documents and records are being held on behalf of the Indenture Trustee, and the Property Manager shall release such documents and records from its custody only in accordance with this Agreement.        (c)  With respect to any Mortgaged Property or Mortgage Loan the First Collateral Date of which occurred prior to the Applicable Series Closing Date, no additional documents shall be delivered by any Issuer or Property Manager to, or reviewed by, the Custodian in connection with the Applicable Series Closing Date, it being understood that the related Loan                                      41 US-DOCS\ 96557504.7 102826315.7 

 

Files and related Lease Files were previously delivered by each Issuer and reviewed by the Custodian.        (d)  The Property Manager shall monitor the delivery of the Lease Files and the Loan Files to the Custodian, for the benefit of the Indenture Trustee.        Section 2.04 Repurchase or Transfer for Collateral Defects and Breaches of Representations and Warranties .        (a)  If any party hereto discovers that any document required to be included in any Loan File or Lease File is missing (after the date it is required to be delivered) or otherwise deficient (any such absence or deficiency, an “ Applicable Absence or Deficiency ”) or that there exists a breach of any of the representations and warranties made by any Originator set forth in the applicable Property Transfer Agreement, any Issuer as required under Section 2.19 of the Indenture or Section 3.04 of the Series 2014-1 Supplement or the Support Provider under Section 2 of the applicable Performance Undertaking with respect to any applicable Mortgage Loan or Mortgaged Property or related Lease (such representations and warranties, the “Applicable Representations ”), and if such absence or deficiency or breach materially and adversely affects the value of such Mortgage Loan or such Mortgaged Property and related Lease or the interests of any Issuer or the Noteholders therein, such party shall give prompt written notice thereof to the other parties to this Agreement. If such absence, deficiency or breach materially and adversely affects the value of the applicable Mortgage Loan or Mortgaged Property or the related Lease or the interests of the applicable Issuer or the Noteholders in the related Mortgage Loan or Mortgaged Property or related Lease (a “ Collateral Defect ”), within 60 days following notice thereof (which may be extended for an additional 60 days if such Collateral Defect is capable of being cured but not within such initial 60 day period and the applicable Cure Party is diligently proceeding with the cure), an applicable Cure Party shall (a) deliver the missing document or cure the deficiency or breach, as the case may be, in all material respects or (b) repurchase such Mortgage Loan or Mortgaged Property from the applicable Issuer at an amount equal to the Payoff Amount for such Mortgage Loan or Mortgaged Property (or if the applicable Issuer acquired such Mortgage Loan or Mortgaged Property by contribution from the applicable Cure Party, transfer the applicable Payoff Amount to the applicable Issuer upon which transfer the applicable Issuer may at its option reconvey such Mortgage Loan or Mortgaged Property to such Cure Party), or exchange one or more Qualified Substitute Mortgage Loans or Qualified Substitute Mortgaged Properties for such Mortgage Loan or Mortgaged Property (or if the applicable Issuer assigned such Mortgage Loan or Mortgaged Property by contribution from the applicable Cure Party, substitute a Qualified Substitute Mortgage Loan or Qualified Substitute Mortgaged Property by contribution to the applicable Issuer, upon which contribution the applicable Issuer may at its option reconvey the Mortgage Loan or Mortgaged Property being substituted for by the applicable Cure Party), as the case may be (subject to Section 7.04); provided , that if (i) such Collateral Defect is capable of being cured (including by delivery of a missing document) but not within such 60-day period, (ii) an applicable Cure Party has commenced and is diligently proceeding with the cure (which may include the delivery of a missing document) of such Collateral Defect within such 60-day period, and (iii) prior to the end of such 60-day period, an applicable Cure Party shall have delivered to the applicable Issuer, the Property Manager and the Indenture Trustee a certification executed on                                     42 US-DOCS\ 96557504.7 102826315.7 

 

its behalf by an officer thereof setting forth the reason such Collateral Defect is not capable of being cured within an initial 60-day period and what actions such Cure Party is pursuing in connection with the cure thereof and stating that it anticipates that such Collateral Defect will be cured within an additional period of 60 days, then such Cure Party shall have an additional 60 days commencing on the 61 st  day from receipt of such certification by the Indenture Trustee to (x) complete such cure or (y) effectuate a repurchase of, or exchange for, the applicable Mortgage Loan or Mortgaged Property as described in clause (b) above. If the affected Mortgaged Property or Mortgage Loan is to be repurchased, funds in the amount of the Payoff Amount shall be wired to the Release Account, and the Property Manager shall promptly notify the applicable Issuer, the Back-Up Manager, and the Indenture Trustee when such deposit is made. In addition, failure to deliver the documents specified in clauses (i), (ii), (iv) or (ix) of the definition of “Loan File” with respect to any Mortgage Loan or clauses (i), (iv) or (v) in the definition of “Lease File” with respect to any Mortgaged Property, in each case to the Collateral Agent, shall be deemed to constitute a Collateral Defect with respect to such Mortgaged Property or Mortgage Loan, as applicable.        In the event that an applicable Cure Party elects to substitute one or more Qualified Substitute Mortgaged Properties or Qualified Substitute Mortgage Loans for the affected Mortgaged Property or Mortgage Loan pursuant to this Section 2.04(a) , such Cure Party shall give notice of same to the Back-Up Manager and each Issuer and deliver, or cause to be delivered, to the Custodian all documents as specified in the definition of “Lease File” or “Loan File” in the Custody Agreement with respect to each such Qualified Substitute Mortgaged Property or Qualified Substitute Mortgage Loan no later than the date such Qualified Substitute Mortgaged Property or Qualified Substitute Mortgage Loan is acquired by the applicable Issuer. Notwithstanding anything to the contrary herein, Monthly Lease Payments due with respect to Qualified Substitute Mortgaged Properties and Monthly Loan Payments due with respect to Qualified Substitute Mortgage Loans in the month in which the applicable substitution occurs shall not be part of the Collateral and will be retained by the Property Manager and remitted by the Property Manager to the applicable Cure Party. Notwithstanding anything to the contrary herein, in the event that any Mortgaged Property or Mortgage Loan is to be substituted for (and released) pursuant to this Section 2.04(a) , the applicable Issuer shall be entitled to receive the Monthly Lease Payment due on the Lease for any such Mortgaged Property in the month in which such substitution occurs and the Monthly Loan Payment due on any such Mortgage Loan in the month in which such substitution occurs and thereafter the applicable Person acquiring such Mortgaged Property or Mortgage Loan shall be entitled to retain all amounts received in respect of such Lease or Mortgage Loan. On or prior to the effective date of any substitution or repurchase pursuant to this Section 2.04(a) , the Property Manager shall deliver to the Indenture Trustee and the Issuers an amended Mortgaged Property Schedule and Mortgage Loan Schedule reflecting the addition (if any) to the Collateral of each new Qualified Substitute Mortgaged Property and Lease and each new Qualified Substitute Mortgage Loan and the removal from the Collateral of each Mortgaged Property and Lease and each Mortgage Loan that, in either case, was repurchased or substituted for. For the avoidance of doubt, in the event that any Cure Party takes any action described in this Section 2.4(a) , the failure to take such action shall not constitute a default or breach with respect to any other Cure Party. Notwithstanding anything to the contrary herein, it is understood and agreed that the obligations of the Cure Parties expressly set forth in this Section 2.04(a)  constitute (i) the sole remedies available to the Noteholders and                                     43 US-DOCS\ 96557504.7 102826315.7 

 

to the Indenture Trustee on their behalf in respect of a breach of the Applicable Representations and (ii) the sole remedies available to the Noteholders and to the Indenture Trustee on their behalf in respect of an Applicable Absence or Deficiency.        (b)  Upon receipt of an Officer’s Certificate from the Property Manager to the effect that all requirements for any repurchase or substitution pursuant to Section 2.4(a)  have been satisfied, which Officer’s Certificate shall be furnished by the Property Manager promptly after such requirements have been satisfied, the Indenture Trustee or the Custodian, as applicable, shall release or cause to be released to the Person acquiring such Mortgaged Property or Mortgage Loan, or its designee, the related Lease File or Loan File, as applicable, and each of the applicable Issuer, the Indenture Trustee and the Collateral Agent shall execute and deliver such instruments of release, transfer and assignment, in each case without recourse, as shall be provided to it and are reasonably necessary to vest in such Person the ownership of such Mortgaged Property and the related Lease or Mortgage Loan, free and clear of the lien of the Indenture and the related Mortgage. The Property Manager shall, and is hereby authorized and empowered by each applicable Issuer and the Indenture Trustee to, prepare, execute and deliver in its own name, on behalf of such Issuer, the Indenture Trustee and the Collateral Agent or any of them, the endorsements, assignments and other documents contemplated by this Section 2.04(b) , and such Issuer, the Indenture Trustee and the Collateral Agent shall execute and deliver any limited powers of attorney substantially in the form of Exhibit D  necessary to permit the Property Manager to do so; provided , however , that none of the Issuers, the Issuer Members, the Indenture Trustee or the Collateral Agent shall be held liable for any misuse of any such power of attorney by the Property Manager and the Property Manager hereby agrees to indemnify the Issuers, the Issuer Members, the Indenture Trustee and the Collateral Agent against, and hold the Issuers, the Issuer Members, the Indenture Trustee and the Collateral Agent harmless from, any loss or liability arising from any misuse of such power of attorney. In connection with any such repurchase or substitution by any Cure Party, the Property Manager or the Special Servicer, as appropriate, shall deliver the related Lease File or Loan File, as applicable, to such Cure Party.        (c)  If any Cure Party defaults on its obligations to repurchase or substitute for any Mortgaged Property as contemplated by Section 2.04(a)  or the applicable Performance Undertaking, as the case may be, the Property Manager shall promptly notify the Issuers, the Back-Up Manager and the Indenture Trustee and shall take such actions with respect to the enforcement of such obligations, including the institution and prosecution of appropriate proceedings, as the Property Manager shall determine, in its good faith and reasonable judgment, are in the best interests of the applicable Issuer and the Noteholders. In the event the Property Manager fails to take such actions, the Back-Up Manager shall do so if it has notice of such default by the Property Manager. Any and all expenses incurred by the Property Manager or the Back-Up Manager with respect to the foregoing shall constitute Property Protection Advances in respect of the affected Mortgaged Property and neither the Property Manager nor the Back-Up Manager shall have any obligation to any such expenses if it determines that such amounts would constitute Nonrecoverable Advances.        Section 2.05 Non-Petition .        The Issuers will cause each party to any property transfer agreement, purchase and sale agreement or loan purchase agreement between any such Issuer and seller of Mortgage Loans or                                     44 US-DOCS\ 96557504.7 102826315.7 

 

Mortgaged Properties pursuant thereto (other than such agreement in which the applicable Issuer does not incur any material liability or obligation or in which the applicable Issuer satisfies each of its material liabilities or obligations thereunder as of the date of such agreement) to covenant and agree that such party shall not institute against, or join any other Person in instituting against, any Issuer, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding, or any other proceeding under any federal or state bankruptcy or similar law.                                  ARTICLE III    ADMINISTRATION AND SERVICING OF MORTGAGED PROPERTIES AND LEASES        Section 3.01 Administration of the Mortgaged Properties , Leases and Mortgage Loans .        (a)  Each of the Property Manager and the Special Servicer shall service and administer the Mortgaged Properties, Leases and Mortgage Loans in the Collateral Pool that it is obligated to service and administer pursuant to this Agreement on behalf of the applicable Issuers, and in the best interests and for the benefit of the holders of the Notes and the LLC Interests (as a collective whole) in accordance with any and all applicable laws and the terms of this Agreement, the Property Insurance Policies and the respective Leases and Mortgage Loans and, to the extent consistent with the foregoing, in accordance with the Servicing Standard. Without limiting the foregoing, and subject to Section 3.20 , (i) the Property Manager shall service and administer each Lease (and each related Mortgaged Property) and each Mortgage Loan as to which no Servicing Transfer Event has occurred and each Corrected Lease and Corrected Loan, and (ii) the Special Servicer shall service and administer each Lease (and each related Mortgaged Property) and each Mortgage Loan as to which a Servicing Transfer Event has occurred and that is not a Corrected Lease or Corrected Loan, as applicable; provided , however , that the Property Manager shall continue to collect information and prepare and deliver all reports to the Indenture Trustee and the Issuers required hereunder with respect to any Specially Serviced Leases (and the related Mortgaged Properties) and Specially Serviced Loans, and further to render such incidental services with respect to any Specially Serviced Assets as are specifically provided for herein. No direction, consent or approval or lack of direction, consent or approval of any Controlling Party or the Requisite Global Majority may (and the Special Servicer or the Property Manager will ignore and act without regard to any such advice or approval or lack of approval that the Special Servicer or the Property Manager has determined, in its reasonable, good faith judgment, would) (A) require or cause the Special Servicer or the Property Manager to violate applicable law, the Servicing Standard or the terms of any Mortgage Loan or any Lease or (B) expand the scope of the Property Manager’s or Special Servicer’s responsibilities under this Agreement. In addition, neither the Property Manager nor the Special Servicer, acting in its individual capacity (and, for the avoidance of doubt, not in the capacity of Special Servicer or Property Manager), shall take any action or omit to take any action as lessor of any Collateral if such action or omission would materially and adversely affect the interests of the holders of the Notes or the LLC Interests or the Issuers. None of the Property Manager, the Special Servicer or the Back-Up Manager shall be liable to the Indenture Trustee, any Noteholder or any other Person for following any direction of a Controlling Party hereunder, and any action taken in accordance with such direction shall be deemed to be in accordance with the Servicing Standard and deemed not to breach such party’s obligations hereunder.                                     45 US-DOCS\ 96557504.7 102826315.7 

 

      (b)  Subject to Section 3.01(a) , the Property Manager and the Special Servicer each shall have full power and authority, acting alone, to do or cause to be done any and all things in connection with such servicing and administration of the Mortgage Loans and Mortgaged Properties and related Leases that it may deem necessary or desirable. Without limiting the generality of the foregoing, each of the Property Manager and the Special Servicer, in its own name, with respect to each of the Mortgaged Properties, Leases and Mortgage Loans it is obligated to service or administer hereunder, is hereby authorized and empowered by the applicable Issuers and the Indenture Trustee to execute and deliver, on behalf of each such Issuer and the Indenture Trustee: (i) any and all financing statements, continuation statements and other documents or instruments necessary to maintain the lien created by any Mortgage or other security document in the related Asset File on the related Collateral; (ii) in accordance with the Servicing Standard and subject to Sections 3.08  and 3.19 , any and all modifications, waivers, amendments or consents to or with respect to any documents contained in the related Asset File; and (iii) any and all instruments of satisfaction or cancellation, or of partial or full release or discharge, and all other comparable instruments. Subject to Section 3.10 , each applicable Issuer and the Indenture Trustee shall, at the written request of a Servicing Officer of the Property Manager or the Special Servicer, furnish, or cause to be so furnished, to the Property Manager or the Special Servicer, as the case may be, any limited powers of attorney (substantially in the form of Exhibit D  attached hereto) and other documents necessary or appropriate to enable it to carry out its servicing and administrative duties hereunder; provided , however , that none of the Issuers, the Issuer Members or the Indenture Trustee shall be held liable for any misuse of any such power of attorney by the Property Manager or the Special Servicer and each of the Property Manager and the Special Servicer hereby agree to indemnify the Issuers, the Issuer Members, the Back-Up Manager and the Indenture Trustee against, and hold the Issuers, the Issuer Members, the Back-Up Manager and the Indenture Trustee harmless from, any cost, loss or liability arising from any misuse by it of such power of attorney. Notwithstanding anything contained herein to the contrary, the Property Manager shall not, without the Indenture Trustee’s written consent: (i) initiate any action, suit or proceeding solely under the Indenture Trustee’s name without indicating the Indenture Trustee’s representative capacity or (ii) take any action with the intent to cause, and which actually does cause, the Indenture Trustee to be registered to do business in any state.        (c)  Promptly after any request therefor, the Property Manager shall provide to the Indenture Trustee: (i) the most recent inspection report prepared or obtained by the Property Manager or the Special Servicer in respect of each Mortgaged Property pursuant to Section 3.12(a) ; (ii) the most recent available operating statement and financial statements of the related Obligor collected by the Property Manager or the Special Servicer pursuant to Section 3.12(b) , together with the accompanying written reports to be prepared by the Property Manager or the Special Servicer, as the case may be, pursuant to Section 3.12(c) ; and (iii) any and all notices and reports with respect to any Mortgaged Property as to which environmental testing is contemplated by Section 10.08 of the Indenture.        (d)  The relationship of each of the Property Manager and the Special Servicer to the Issuers and the Indenture Trustee under this Agreement is intended by the parties to be and shall be that of an independent contractor and not that of a joint venturer, partner or agent.                                      46 US-DOCS\ 96557504.7 102826315.7 

 

      (e)  The Property Manager will cause the form of each Mortgage with respect to Mortgaged Properties added to the Collateral Pool after the Applicable Series Closing Date to be prepared with review and comment by counsel licensed to practice in the state where such Mortgage is filed.        Section 3.02 Collection of Lease Payments and Loan Payments; Lockbox Accounts; Lockbox Transfer Accounts .        (a)  Each of the Property Manager and the Special Servicer shall undertake reasonable efforts to collect all payments called for under the terms and provisions of the Leases and the Mortgage Loans it is obligated to service hereunder and shall, to the extent such procedures shall be consistent with this Agreement (including Section 3.01(a)) , follow such collection procedures as it would follow were it the owner of such Leases and Mortgage Loans. Consistent with the foregoing (and without regard to Section 3.19) , the Special Servicer or the Property Manager, as the case may be, may waive any Net Default Interest or late payment charge it is entitled to in connection with any delinquent payment on a Lease or Mortgage Loan it is obligated to service hereunder.        (b)  The Property Manager shall establish and maintain one or more segregated accounts (each, a “ Lockbox Account ”) with one or more banks (each, a “ Lockbox Account Bank ”). Each Lockbox Account shall be an Eligible Account and may be an account to which payments relating to other assets serviced or managed by the Property Manager are paid; provided , that such account shall be in the nature of a clearing account and the Property Manager shall not have access to such account; provided , further, that the Property Manager shall at all times be able to readily identify any amounts that constitute Collateral. Each of the Property Manager and the Special Servicer shall, as to those Leases and Mortgage Loans it is obligated to service hereunder, instruct the related Obligor to make all Monthly Lease Payments and Monthly Loan Payments to a Lockbox Account. The Property Manager shall cause all amounts deposited into the Lockbox Account with respect to the Collateral to be transferred to the Collection Account or a Lockbox Transfer Account within one Business Day after such funds have been identified, cleared and become available in accordance with the polices of the Lockbox Account Bank; provided , that the Property Manager shall cause all such amounts to be transferred to the Collection Account or the Lockbox Transfer Account no later than seven Business Days after such amounts have been deposited into a Lockbox Account (the requirements set forth in this sentence, the “ Lockbox Transfer Requirements ”).        (c)  The Property Manager may establish and maintain one or more segregated accounts in the name of the Property Manager on behalf of the Indenture Trustee, held for the benefit of the Noteholders (each, a “ Lockbox Transfer Account ”) with one or more banks (each, a “ Lockbox Transfer Account Bank ”). Each Lockbox Transfer Account shall be an Eligible Account. Each Lockbox Transfer Account shall be subject to an Account Control Agreement (in form and substance satisfactory to the Indenture Trustee) among the Property Manager, the Indenture Trustee and the applicable Lockbox Transfer Account Bank. Except as expressly permitted herein, neither the Property Manager nor the Issuers will have any right of withdrawal from the Lockbox Transfer Account, and the Property Manager hereby covenants                                      47 US-DOCS\ 96557504.7 102826315.7 

 

and agrees that it shall not withdraw, or direct any Person to withdraw, any funds from the Lockbox Transfer Account except as expressly permitted hereunder.        Section 3.03 Collection of Real Estate Taxes and Insurance Premiums; Servicing Accounts; Property Protection Advances; P&I Advances; Emergency Property Expenses .        (a)  Each of the Property Manager and the Special Servicer shall, as to those Mortgaged Properties, Leases and Mortgage Loans it is obligated to service and administer hereunder, establish and maintain one or more accounts (the “ Servicing Accounts ”), and shall cause to be deposited from the Lockbox Transfer Account or otherwise into such Servicing Accounts all Escrow Payments, security deposits received from Tenants pursuant to the Leases, subject to the Tenants’ rights to such amounts (“ Lease Security Deposits ”), and amounts required to be paid by the applicable Issuers as lessors under the Leases in respect of sales taxes (“ Sales Tax Deposits ”). Notwithstanding the foregoing, no Servicing Accounts shall be established and maintained with respect to those Mortgaged Properties, Leases or Mortgage Loans pursuant to which the Tenant or Borrower is not required to make Escrow Payments, Lease Security Deposit or Sales Tax Deposits. Each Servicing Account shall be an Eligible Account. Withdrawals of amounts so collected from a Servicing Account (other than Lease Security Deposits) may be made only to: (i) effect payment of real estate or personal property taxes, sales taxes, assessments, insurance premiums, ground rents (if applicable) and comparable items (including taxes or other amounts that could constitute liens prior to or on parity with the lien of the related Mortgage); (ii) refund to Obligors any sums as may be determined to be overages; (iii) pay interest, if required and as described below in clause (b) , to Obligors on balances in the Servicing Account; (iv) clear and terminate the Servicing Account at the termination of this Agreement in accordance with Section 8.01 ; (v) withdraw any amounts deposited in error or (vi) for any other purpose required by the applicable Lease or Mortgage Loan; provided , however , that Lease Security Deposits may not be withdrawn for such purposes and shall be withdrawn only in accordance with the terms of the related Lease, to be repaid to the related Tenant or applied in full or partial satisfaction of the obligations of the related Tenant in accordance with the Servicing Standard (for application in the same manner as payments in respect of such obligations). Any remaining portion of such Lease Security Deposit (after no further allocations could be required pursuant to clauses (i) through (vi) above) shall be withdrawn by the Property Manager from the Servicing Account and deposited into the Collection Account and shall constitute part of the Available Amount on the next Payment Date.        (b)  The Property Manager and the Special Servicer shall each pay or cause to be paid to the Obligors interest, if any, earned on the investment of funds in Servicing Accounts maintained thereby, if required by law or the terms of the related Lease or Mortgage Loan. If the Property Manager or the Special Servicer shall deposit in a Servicing Account any amount not required to be deposited therein, it may at any time withdraw such amount from such Servicing Account, any provision herein to the contrary notwithstanding.        (c)  Each of the Property Manager and the Special Servicer shall, as to those Mortgaged Properties and Mortgage Loans it is obligated to service hereunder, maintain accurate records with respect to any Mortgaged Property and Mortgage Loan reflecting the status of real estate taxes, ground rents, assessments and other similar items that are or may become a lien thereon, and the status of insurance premiums payable in respect thereof that, in                                     48 US-DOCS\ 96557504.7 102826315.7 

 

each case, the related Obligor is contractually or legally obligated to pay under the terms of the applicable Lease or Mortgage Loan or applicable law, and the Property Manager shall effect payment thereof, as a Property Protection Advance or otherwise as payment of an Emergency Property Expense from funds on deposit in the Collection Account, as described below, if not paid by such Obligor prior to the applicable due, penalty or termination date, promptly after the Property Manager or Special Servicer, as the case may be, receives actual notice from any source of such nonpayment by such Obligor. For purposes of effecting any such payment for which it is responsible, the Property Manager or the Special Servicer, as the case may be, shall apply Escrow Payments as allowed under the terms of the related Lease or Mortgage Loan or, if such Lease or Mortgage Loan does not require the related Obligor to escrow for the payment of real estate taxes, assessments and insurance premiums, each of the Property Manager and the Special Servicer shall, as to those Leases and Mortgage Loans it is obligated to service hereunder, enforce the requirement of the related Lease and Mortgage Loan that such Obligor make payments in respect of such items at the time they first become due.        (d)  In accordance with the Servicing Standard, the Property Manager shall make Property Protection Advances with respect to each Mortgaged Property, Lease and Mortgage Loan in the Collateral Pool; provided , that in no event shall the Property Manager be required to make any Property Protection Advance that it determines would constitute a Nonrecoverable Property Protection Advance in accordance with Section 3.03(f) . Notwithstanding anything to the contrary herein, (i) the Property Manager shall not have any obligation to advance funds in respect of delinquent payments of principal or interest in respect of the Mortgage Loans and (ii) the Property Manager shall not have any obligation to advance real estate taxes or premiums on Insurance Policies that the related obligor or the Issuer is not contractually or legally obligated to pay, nor shall it have any obligation to monitor the timely payment of real estate taxes and insurance premiums the payment of which is the responsibility of a person other than the applicable Tenant or Borrower or Issuer; provided  that if the Property Manager has actual knowledge of the nonpayment of such real estate taxes and insurance premiums, it shall be obligated to make such advance in accordance with the provisions set forth herein if it would otherwise make such advance in accordance with the Servicing Standard. Each of the Property Manager, the Indenture Trustee and the Back-Up Manager will be entitled to recover any Property Protection Advance (i) from general collections if such Property Protection Advance is determined to be a Nonrecoverable Property Protection Advance, (ii) from any amounts subsequently received on the related Mortgage Loan or Lease or with respect to the related Mortgaged Property with respect to which such Property Protection Advance was made or (iii) in the case of the Back-Up Manager or Indenture Trustee, to the extent not recovered under clauses (i)  and (ii) immediately above, from the Property Manager or any Successor Property Manager. The Property Manager shall give prompt written notice to the Indenture Trustee and the Back-Up Manager in the event that it has not made, and does not intend to make, any Property Protection Advance it is required to make hereunder. Promptly upon obtaining knowledge that the full amount of any Property Protection Advance required to be made by the Property Manager has not been so made, the Indenture Trustee shall provide notice of such failure to a Servicing Officer of the Property Manager and the Back-Up Manager. If the Indenture Trustee does not receive confirmation that the full amount of such Property Protection Advance has been made within four (4) Business Days following the date of such notice, then the Back-Up Manager, upon written notice from the Indenture Trustee, shall make the portion of                                     49 US-DOCS\ 96557504.7 102826315.7 

 

such Property Protection Advance that was required to be, but was not, made by the Property Manager in accordance with the Servicing Standard, unless the Back-Up Manager determines in accordance with the Servicing Standard that such Property Protection Advance would be a Nonrecoverable Property Protection Advance. Promptly upon obtaining knowledge that the full amount of any Property Protection Advance required to be made by the Back-Up Manager has not been so made, then the Indenture Trustee shall make the portion of such Property Protection Advance that was required to be, but was not, made by the Back-Up Manager, unless the Indenture Trustee determines in its commercially reasonable judgment that such Property Protection Advance would be a Nonrecoverable Property Protection Advance. In making any such determination, the Indenture Trustee may conclusively rely on any determination of nonrecoverability by the Property Manager or the Back-Up Manager, as the case may be. Any such Property Protection Advance made by the Back-Up Manager or the Indenture Trustee shall thereafter be reimbursable to the such Indenture Trustee or Back-Up Manager, together with Advance Interest thereon, in accordance Section 2.11 of the Indenture or from any Successor Property Manager.        (e)  If, prior to making any Property Protection Advance, the Property Manager shall have determined (which shall be evidenced by an Officer’s Certificate delivered to the Indenture Trustee), in accordance with the Servicing Standard, (i) that such Property Protection Advance, if made, would constitute a Nonrecoverable Property Protection Advance, and (ii) that the payment of such cost, expense or other amount for which a Property Protection Advance might be made is nonetheless in the best interest of the Noteholders, the Property Manager shall, in accordance with the Servicing Standard, withdraw (or, in the event the Property Manager is Spirit Realty, direct the Indenture Trustee to withdraw) funds from the Collection Account and use such funds in order to pay such costs, expenses and other amounts (collectively, “Emergency Property Expenses ”) to the extent necessary to preserve the security interest in, and value of, any Mortgaged Property or Mortgage Loan, as applicable. Any such funds withdrawn from the Collection Account to pay Emergency Property Expenses shall not constitute part of the Available Amount on any Payment Date.        (f)  In determining whether it has made a Nonrecoverable Property Protection Advance or whether any proposed Property Protection Advance, if made, would constitute a Nonrecoverable Property Protection Advance, the Property Manager (or, if applicable, the Back- Up Manager or Indenture Trustee) shall be entitled to (a) consider (among other things) the obligations of the Obligor under the terms of the related Lease Documents or Loan Documents as they may have been modified, (b) consider the related Mortgaged Properties or REO Properties in their “as is” or then current conditions and occupancies, as modified by such party’s assumptions (consistent with the Servicing Standard in the case of the Property Manager or the Back-Up Manager) regarding the possibility and effects of future adverse changes with respect to such Mortgaged Properties or REO Properties, (c) estimate and consider (consistent with the Servicing Standard in the case of the Property Manager or the Back-Up Manager) (among other things) future expenses, and (d) estimate and consider (consistent with the Servicing Standard in the case of the Property Manager or the Back-Up Manager) (among other things) the timing of recoveries. If applicable to a Series of Notes, none of the Property Manager, the Back-Up Manager or the Indenture Trustee, as applicable, shall take into account amounts on deposit in the Post-Closing Acquisition Reserve Account in determining whether it has made a                                     50 US-DOCS\ 96557504.7 102826315.7 

 

Nonrecoverable Property Protection Advance or whether any proposed Property Protection Advance, if made, would constitute a Nonrecoverable Property Protection Advance. In addition, any such Person may update or change its recoverability determinations at any time (but not reverse any other Person’s determination that a Property Protection Advance is a Nonrecoverable Property Protection Advance) and, consistent with the Servicing Standard, in the case of the Property Manager, the Back-Up Manager or the Indenture Trustee, may obtain promptly upon request, from the Special Servicer, any reasonably required analysis, appraisals or market value estimates or other information in the Special Servicer’s possession for making a recoverability determination. The determination by the Property Manager, the Back-Up Manager or the Indenture Trustee, as the case may be, that it has made a Nonrecoverable Property Protection Advance or that any proposed Property Protection Advance, if made, would constitute a Nonrecoverable Property Protection Advance, or any updated or changed recoverability determination, shall be evidenced by an Officer’s Certificate delivered by such Back-Up Manager, Property Manager or Indenture Trustee to each other such Person and to the Issuers. Any such determination shall be conclusive and binding on the applicable Issuer, the Property Manager, the Noteholders the Back-Up Manager and the Indenture Trustee. The Officer’s Certificate shall set forth such determination of nonrecoverability and the considerations of the Property Manager, the Back-Up Manager or the Indenture Trustee, as applicable, forming the basis of such determination (which shall be accompanied by, to the extent available, information such as related income and expense statements, rent rolls, occupancy status and property inspections, and shall include an appraisal of the related Lease, Mortgage Loan or Mortgaged Property or REO Property). The Special Servicer shall promptly furnish any party required to make Property Protection Advances hereunder with any information in its possession regarding the Specially Serviced Assets which are Leases, Mortgaged Properties, Mortgage Loans and REO Properties as such party required to make Property Protection Advances may reasonably request for purposes of making recoverability determinations. In the case of a cross collateralized Mortgage Loan, such recoverability determination shall take into account the cross collateralization of the related cross-collateralized Mortgage Loan.        (g)  In the event that a P&I Shortfall exists with respect to any Series for any Payment Date, the Property Manager shall deposit an amount equal to such P&I Shortfall with respect to such Series into a Series Account for such Series no later than 11:00 a.m. New York time on the related Remittance Date, and such amount shall be added to (and applied as) Series Available Amount for such Series for such Payment Date (any such amount, a “ P&I Advance ”).        (h)  Notwithstanding anything to the contrary herein, none of the Property Manager, the Back-Up Manager or the Indenture Trustee shall be required to make any P&I Advance that it determines would constitute a Nonrecoverable P&I Advance. In making a determination that any P&I Advance is (or is not) a Nonrecoverable Advance, the Property Manager, the Back-Up Manager or the Indenture Trustee, as applicable, may consider only the obligations of the Issuers under the terms of the transaction documents as they may have been modified, the Collateral in “as is” or then current condition and the timing and availability of anticipated cash flows as modified by such party’s assumptions regarding the possibility and effect of future adverse changes, together with such other factors, including but not limited to an estimate of future expenses, timing of recovery, the inherent risk of a protracted period to complete liquidation or the potential inability to liquidate Collateral as a result of intervening creditor claims or of a                                     51 US-DOCS\ 96557504.7 102826315.7 

 

bankruptcy proceeding affecting the Issuer and the effect thereof on the existence, validity and priority of any security interest encumbering the Collateral, available cash on deposit in the Collection Account, the future allocations and disbursements of cash on deposit in the Collection Account, and the net proceeds derived from any of the foregoing. If applicable to a Series of Notes, none of the Property Manager, the Back-Up Manager or the Indenture Trustee, as applicable, shall take into account amounts on deposit in the Post-Closing Acquisition Reserve Account in such determination of whether a P&I Advance is (or is not) a Nonrecoverable Advance. Any such determination shall be conclusive and binding on the applicable Issuer, the Property Manager, the Special Servicer, the Noteholders the Back-Up Manager and the Indenture Trustee.        (i)  If the Indenture Trustee does not receive confirmation that the full amount of such P&I Advance has been made by 5:00 p.m. New York time on such Remittance Date for any Series, then the Back-Up Manager, after receipt of written notice from the Indenture Trustee, shall deposit, into a Series Account for such Series, the portion of such P&I Advance that was required to be, but was not, made by the Property Manager in respect of such Series by 10:00 a.m. New York time on the Payment Date, unless the Back-Up Manager determines (in accordance with clause (h) above) that such P&I Advance would be a Nonrecoverable P&I Advance. If the Indenture Trustee does not receive confirmation that the full amount of such P&I Advance for such Series that was required to be made in respect of such Series by such Back-Up Manager has been made by 11:00 a.m. New York time on such Remittance Date, then the Indenture Trustee, shall deposit, into a Series Account for such Series, the portion of such P&I Advance that was required to be, but was not, made by the Property Manager in respect of such Series on or prior to the time the Series Available Amount is distributed to such Series in accordance with the terms of the Indenture, unless the Indenture Trustee determines (in accordance with clause (h) above) that such P&I Advance would be a Nonrecoverable P&I Advance. In making any such determination, the Indenture Trustee may conclusively rely on any determination of nonrecoverability by the Property Manager or the Back-Up Manager, as the case may be.        (j)  Additionally, in the event that a Series of Notes is proposed to be issued after the Applicable Series Closing Date, the Property Manager will give notice to the Back-Up Manager and the Indenture Trustee of such proposed issuance. Within ten business days of receipt of such notice, the Back-Up Manager will be obligated to notify the Property Manager and the Indenture Trustee in writing as to whether the Back-Up Manager is willing to make Advances after such Series of Notes is issued. Notwithstanding anything to the contrary herein, in the event that the Back-Up Manager delivers to the Property Manager and the Indenture Trustee a notice stating that it is unwilling to make such Advances after such issuance (with respect to any such Series of Notes, a “ Decline to Advance Notice ”), the Property Manager in its sole discretion (and without the consent of the Indenture Trustee, any Issuer or any Noteholder) will be permitted to remove the Back-Up Manager (a “ Discretionary Back-Up Manager Removal ”) and appoint a successor Back-Up Manager (so long as the Rating Condition is satisfied in connection with such appointment); provided , that, no such removal will be effective until such a successor Back-Up Manager is appointed. In the event of any such removal, the Issuer, the Indenture Trustee and the Back-Up Manager shall be required to (i) cooperate reasonably to effectuate the transfer of the back-up servicing rights, duties and obligations to such successor and (ii) take any actions                                     52 US-DOCS\ 96557504.7 102826315.7 

 

reasonably requested by the Property Manager in order to effectuate such appointment. In the event that a Series of Notes is issued with respect to which the Back-Up Manager has delivered to the Property Manager and the Indenture Trustee a Decline to Advance Notice but a successor Back-Up Manager has not been appointed, the Back-Up Manager will have no further obligation to make any Advance from and after the date (the “ Non-Advance Date ”) of issuance of such Series of Notes (but, for the avoidance of doubt, will have the right to be reimbursed for any Advances previously made). If the Back-Up Manager has delivered a Decline to Advance Notice to the Property Manager and the Indenture Trustee and a successor Back-Up Manager has not been appointed, the obligations of the Indenture Trustee to make Advances shall automatically cease as of the Non-Advance Date (but, for the avoidance of doubt, the Indenture Trustee will have the right to be reimbursed for any Advances previously made). So long as the Back-Up Manager has not been removed, after any Non-Advance Date, the Back-Up Manager may deliver an Officer’s Certificate to each of the Property Manager and the Indenture Trustee stating that it wishes to reinstate its obligation to make Advances. Upon such delivery, (x) the Back-Up Manager and the Indenture Trustee will again be obligated to make Advances to the extent required in accordance with this Agreement and in the manner described in this Agreement (as if the applicable Decline to Advance Notice had not been delivered) and (y) the Property Manager will no longer be permitted to effectuate a Discretionary Back-Up Manager Removal, in each case until a subsequent Decline to Advance Notice is delivered by the Back-Up Manager (which may only be delivered in connection with an additional proposed issuance of a Series of Notes).        Section 3.04 Collection Account; Release Account; Exchange Reserve Account .        (a)  The Property Manager shall establish and maintain one or more separate accounts in the name of the Indenture Trustee for the benefit of the Noteholders, for the collection of payments on and other amounts received in respect of the Leases, the Mortgaged Properties and the Mortgage Loans (collectively, the “ Collection Account ”), which shall be established in such manner and with the type of depository institution (the “ Collection Account Bank ”) specified in this Agreement that permits the Collection Account to be an Eligible Account. The Collection Account shall be an Eligible Account. If the Property Manager is Spirit Realty, the Property Manager shall establish and maintain the Collection Account at a Collection Account Bank at the Indenture Trustee and the Indenture Trustee shall have the sole right of withdrawal from such account; provided , that the Property Manager shall be permitted to make withdrawals from such Collection Account to the extent expressly permitted under the terms hereof. If the Property Manager is not Spirit Realty or another Affiliate of the Issuers, the Collection Account shall be subject to an Account Control Agreement among the applicable Issuers, the Property Manager, the Indenture Trustee and the Collection Account Bank.        Unless otherwise expressly required hereunder, the Property Manager shall deposit or cause to be deposited in the Collection Account, (i) other than payments and collections deposited into a Lockbox Account, within two (2) Business Days after receipt, the following payments and collections received or made by or on behalf of the Property Manager on or after the later of the applicable Transfer Date (other than payments due before the applicable Transfer Date) and (ii) in the case of collections and payments deposited into a Lockbox Account, in accordance with the Lockbox Transfer Requirements, the Property Manager shall instruct each Lockbox Account Bank to transfer the following payments and collections deposited in the                                     53 US-DOCS\ 96557504.7 102826315.7 

 

Lockbox Account (A) to the Lockbox Transfer Account and, within one Business Day thereafter from the Lockbox Transfer Account into the Collection Account or (B) directly into the Collection Account:             (i)   all payments on account of Monthly Lease Payments, Monthly Loan       Payments and, so long as an Early Amortization Event or Sweep Period has occurred and       is continuing, Excess Cashflow;             (ii)  all payments of other amounts payable by the Obligors on the Leases and       the Mortgage Loans, including without limitation Prepayment Consideration Payments;             (iii) all Property Insurance Proceeds, Condemnation Proceeds (other than       proceeds paid to the related Borrower or Tenant as required by Loan Documents or       Lease Documents, as applicable, proceeds applied to the restoration or remediation of       property or otherwise released in accordance with the Servicing Standard) and all       Liquidation Proceeds;             (iv)  all cash proceeds and other amounts (other than Property Insurance       Proceeds and REO Revenues) from the release or substitution of any Mortgage Loan or       Mortgaged Property to the extent not deposited into the Release Account or any       Exchange Account; and all cash proceeds from the release or substitution of any       Mortgage Loan or Mortgaged Property transferred from the Release Account or the       Exchange Reserve Account to the Collection Account pursuant to Section 3.05(b)  and all       proceeds representing earnings on investments in the Release Account (including interest       on any Permitted Investments) made with such proceeds;             (v)   any amounts required to be deposited into the Collection Account       pursuant to Section 3.07(b)  in connection with losses resulting from a deductible clause in       a blanket hazard insurance policy;             (vi)  any amounts received on account of payments under the Guaranties, the       Property Transfer Agreements, the Performance Undertakings or the Environmental       Indemnity Agreements;             (vii) all REO Revenues; and             (viii) any other amounts required to be so deposited under this Agreement.        Except as expressly permitted hereunder, the Property Manager shall not make any withdrawals from the Collection Account except in accordance with this Section 3.04  and Section 3.05(a)  hereof. The Collection Account shall be maintained as a segregated account, separate and apart from trust funds created for certificates, bonds or notes of other series of notes (other than any Series) serviced by and the other accounts of the Property Manager.        Upon direct receipt by the Special Servicer of any of the amounts described above with respect to any Specially Serviced Asset or the Mortgaged Property or REO Property relating thereto, the Special Servicer shall promptly but in no event later than the second Business Day                                     54 US-DOCS\ 96557504.7 102826315.7 

 

after receipt (or, if later, the date on which such amounts are available to the Special Servicer), remit such amounts to the Property Manager for deposit into the Collection Account in accordance with this Section 3.04(a) , unless the Special Servicer determines, consistent with the Servicing Standard, that a particular item should not be deposited therein because of a restrictive endorsement or other reasonably appropriate reason. The Property Manager shall not deposit (or cause to be deposited) into the Collection Account or the Lockbox Transfer Account any collections allocated to Companion Loans, any Additional Servicing Compensation, amounts received on account of Excess Cashflow (so long as no Early Amortization Event or Sweep Period has occurred and is continuing), Sales Tax Deposits, Escrow Payments, Lease Security Deposits, amounts received as reimbursement for any cost paid by the Issuers as lessors or lenders under the Leases or Mortgage Loans, as applicable, amounts collected by or on behalf of the Issuers and held in escrow or impound as lenders or lessors to pay future obligations or other amounts that the Property Manager is not required to deposit into the Collection Account as expressly set forth herein.        With respect to any such amounts paid by check to the order of the Special Servicer, the Special Servicer shall endorse such check to the order of the Property Manager and shall deliver promptly, but in no event later than one (1) Business Day after receipt, any such check to the Property Manager by overnight courier, unless the Special Servicer determines, consistent with the Servicing Standard, that a particular item cannot be so endorsed and delivered because of a restrictive endorsement or other reasonably appropriate reason. The funds held in the Collection Account may be held as cash or invested in Permitted Investments in accordance with the provisions of Section 3.06(a) . Any interest or other income earned on funds in the Collection Account will be added to the Available Amount.        (b)  The Property Manager shall establish and maintain at a bank designated by the Indenture Trustee a segregated account in the name of the Indenture Trustee for the deposit of cash proceeds from the sale of any Mortgage Loan or Mortgaged Property or receipt of any Balloon Payments or Principal Prepayments (the “ Release Account ”). The Release Account shall be an Eligible Account. The funds held in the Release Account may be held as cash or invested in Permitted Investments in accordance with the provisions of Section 3.06(b) . The Release Account and the amounts on deposit therein will be pledged to the Indenture Trustee under the Indenture. The Property Manager will deposit or cause to be deposited in the Release Account any cash proceeds from the sale of any Mortgage Loan or Mortgaged Property and any Balloon Payments or Principal Prepayments received in connection with any Mortgage Loan within one Business Day after such funds have been identified, cleared and become available.        (c)  The Property Manager shall establish and maintain at a bank designated by the Indenture Trustee a segregated account in the name of the Indenture Trustee for the deposit of cash proceeds from the sale of any Mortgaged Property released pursuant to Section 7.01(a) (the “Exchange Reserve Account ”). The Exchange Reserve Account shall be an Eligible Account. The funds held in the Exchange Reserve Account may be held as cash or invested in Permitted Investments in accordance with the provisions of Section 3.06(b) . The Exchange Reserve Account and the amounts on deposit therein will be pledged to the Indenture Trustee under the Indenture. The Property Manager will deposit or cause to be deposited, on behalf of the Issuers, any Exchange Cash Collateral.                                     55 US-DOCS\ 96557504.7 102826315.7 

 

      Section 3.05 Withdrawals From the Collection Account and the Release Account .        (a)  If the Property Manager is Spirit Realty, Spirit MTA or any of their respective affiliates, then the Indenture Trustee shall make withdrawals upon the written direction of the Property Manager from the Collection Account (i) on each Remittance Date, for delivery by wire transfer of immediately available funds for deposit into the Payment Account, of the Available Amount for the related Payment Date for application by the Indenture Trustee to make payments in accordance with the priorities set forth pursuant to Section 2.11(b) of the Indenture, (ii) on any date, to pay any Emergency Property Expenses (pursuant to Section 3.03(e))  and (iii) on any date, to remove amounts deposited in the Collection Account in error. If the Property Manager is an entity other than Spirit Realty, Spirit MTA or any of their respective affiliates, then the Property Manager shall make withdrawals from the Collection Account (i) on each Remittance Date, for delivery by wire transfer of immediately available funds for deposit into the Payment Account, of the Available Amount for the related Payment Date for application by the Indenture Trustee to make payments in accordance with the priorities set forth pursuant to Section 2.11(b) of the Indenture, (ii) at any time on or prior to each Remittance Date, to pay the Property Management Fee, the Back-Up Fee, any Special Servicing Fees, any Liquidation Fees and any Workout Fees (each, pursuant to Section 3.11) , (iii) on any date, to pay any Emergency Property Expenses (pursuant to Section 3.03(e))  or (iv) on any date, to remove amounts deposited in the Collection Account in error. Except as provided in Section 3.04(a) , no other amounts may be withdrawn from the Collection Account by the Property Manager.        (b)  Amounts deposited in the Release Account with respect to any Mortgage Loan, Lease or Mortgaged Property (including Net Investment Earnings on funds on deposit therein) shall be applied by the Property Manager (or the Indenture Trustee based on the instructions of the Property Manager if the Property Manager is Spirit Realty), to reimburse the Property Manager, the Special Servicer and the Back-Up Manager any amounts owed with respect to unreimbursed Extraordinary Expenses, Property Protection Advances and Advance Interest thereon and Emergency Property Expenses related to such Mortgage Loan, Lease or Mortgaged Property and to pay the expenses related to the release of such Mortgage Loan, Lease or Mortgaged Property. After any such reimbursements have been made, any remaining amounts deposited in the Release Account with respect to any Mortgage Loan, Lease or Mortgaged Property (such amount with respect to any Mortgage Loan, Lease or Mortgaged Property, the “Net Release Price ” thereof) shall be applied by the Property Manager (or the Indenture Trustee based on the instructions of the Property Manager if the Property Manager is Spirit Realty) to either (i) permit an Issuer to acquire (or to acquire on behalf of an Issuer) Qualified Substitute Mortgage Loans or Qualified Substitute Mortgaged Properties within twelve months following the release of the applicable Mortgage Loan or Mortgaged Property (in the event that such amounts were received in connection with such a release) or following the receipt of such amounts (in the event that such amounts were received in connection with a Balloon Payment or Principal Prepayment, as applicable) or (ii) after such period concludes with respect to the applicable amounts (or, if the Property Manager elects, prior to the conclusion of such twelve- month period) be deposited as Unscheduled Proceeds into the Collection Account and included in the Available Amount on the Payment Date relating to the Collection Period in which such deposit occurs. Upon the occurrence and during the continuance of an Early Amortization Event, all amounts in the Release Account (and all amounts that otherwise would have been deposited                                     56 US-DOCS\ 96557504.7 102826315.7 

 

into the Release Account excluding amounts on deposit in the Exchange Account, but including equivalent amounts on deposit in the Exchange Reserve Account) shall be deposited as Unscheduled Proceeds into the Collection Account and will be included in the Available Amount on the Payment Date relating to the Collection Period in which such deposit occurs. If the Like- Kind Exchange Program is established, in connection with the sale or disposition of a Mortgaged Property, the Property Manager may elect to deposit or cause to be deposited the related Net Release Price into an Exchange Account (in lieu of the Release Account) for the purpose of consummating an Exchange pursuant to Section 7.01(d).        Section 3.06 Investment of Funds in the Collection Account and the Release Account .        (a)  The Property Manager may direct any institution maintaining the Collection Account to invest the funds held therein in one or more Permitted Investments bearing interest or sold at a discount, and maturing, unless payable on demand, not later than the Business Day immediately preceding the Remittance Date relating to the Payment Date for which such funds will constitute Available Amounts, which may be in the form of a standing direction.        (b)  The Property Manager may direct any institution maintaining the Release Account or Exchange Reserve Account to invest the funds held therein in one or more specific Permitted Investments bearing interest or sold at a discount, and maturing, unless payable on demand, not later than the Business Day immediately preceding the day such amounts are required to be distributed pursuant to Section 3.05(b) , which may be in the form of a standing direction.        (c)  The Property Manager may direct any institution maintaining the Servicing Accounts with respect to Lease Security Deposits to invest the funds held therein in one or more Permitted Investments bearing interest or sold at a discount, and maturing, unless payable on demand, not later than the Business Day immediately preceding the day such amounts are required to be distributed pursuant to the related Lease and this Agreement, which may be in the form of a standing direction.        (d)  [Reserved]        (e)  All Permitted Investments in the Collection Account, the Release Account, the Expense Reserve Account and the Servicing Accounts shall be held to maturity, unless payable on demand. Any investment of funds in the Collection Account, the Release Account, the Expense Reserve Account and the Servicing Accounts shall be made in the name of the Indenture Trustee (in its capacity as such). The Property Manager shall promptly deliver to the Indenture Trustee, and the Indenture Trustee shall maintain continuous possession of, any Permitted Investment that is either (i) a “certificated security,” as such term is defined in the Uniform Commercial Code, or (ii) other property in which the lack of possession of such property could reasonably be expected to materially adversely affect the Noteholders’ interest in such property. If amounts on deposit in the Collection Account, the Release Account, the Expense Reserve Account or the Servicing Accounts are at any time invested in a Permitted Investment payable on demand, the Property Manager shall:             (i)   consistent with any notice required to be given thereunder, demand that       payment thereon be made on the last day such Permitted Investment may otherwise                                     57 US-DOCS\ 96557504.7 102826315.7 

 

      mature thereunder in an amount equal to the lesser of (1) all amounts then payable       thereunder and (2) the amount required to be withdrawn on such date; and             (ii)  demand payment of all amounts due thereunder promptly upon       determination by the Property Manager that such Permitted Investment would not       constitute a Permitted Investment in respect of funds thereafter on deposit in the       Collection Account, the Release Account, the Expense Reserve Account or the Servicing       Accounts, as applicable.        (f)  Interest and investment income realized on funds deposited in the Collection Account and, if applicable, the Release Account and the Exchange Reserve Account  that constitute part of the Available Amount for any Collection Period, to the extent of the Net Investment Earnings, if any, shall be added to the Available Amount for such Collection Period and distributed in accordance with Section 2.11 of the Indenture on the applicable Payment Date. Notwithstanding the investment of funds held in the Collection Account, for purposes of the calculations hereunder, including the calculation of the Available Amount, the amounts so invested shall be deemed to remain on deposit in the Collection Account. Except as provided in Section 5.03(a) , the Property Manager shall have no liability for any investment of funds in the Collection Account, the Release Account, the Expense Reserve Account , the Exchange Reserve Account  or Servicing Account.        (g)  Except as otherwise expressly provided in this Agreement, if any default occurs in the making of a payment due under any Permitted Investment, or if a default occurs in any other performance required under any Permitted Investment, the Property Manager may take such action as may be appropriate to enforce such payment or performance, including the institution and prosecution of appropriate proceedings.        Section 3.07 Maintenance of Insurance Policies; Errors and Omissions and Fidelity Coverage .        (a)  The Property Manager (other than with respect to Specially Serviced Assets) and the Special Servicer (with respect to Specially Serviced Assets) shall use reasonable efforts in accordance with the Servicing Standard to cause the related Obligor to maintain for each Mortgaged Property all insurance coverage as is required under the terms of the related Lease or Mortgage Loan, as applicable (including for the avoidance of doubt, any Environmental Policy); provided , that if and to the extent that any such Lease or Mortgage Loan permits the lessor thereunder any discretion (by way of consent, approval or otherwise) as to the insurance coverage that the related Obligor is required to maintain, the Property Manager or the Special Servicer, as the case may be, shall exercise such discretion in a manner consistent with the Servicing Standard; and provided , further , that, if and to the extent that a Lease or Mortgage Loan so permits, the related Obligor shall be required to obtain the required insurance coverage from Qualified Insurers that have a claims-paying ability rated at least “A:VIII” by A.M. Best’s Key Rating Guide and at least “A” by S&P, which are licensed to do business in the state wherein the related Obligor or the Mortgaged Property subject to the policy, as applicable, is located. If such Obligor does not maintain the required insurance or, with respect to any Environmental Policy in place as of the applicable First Collateral Date, the Property Manager will itself cause such insurance to be maintained with Qualified Insurers meeting such criteria; provided , that the                                     58 US-DOCS\ 96557504.7 102826315.7 

 

Property Manager shall not be required to maintain such insurance if the Indenture Trustee (as mortgagee of record on behalf of the Noteholders) does not have an insurable interest or the Property Manager has determined (in its reasonable judgment in accordance with the Servicing Standard) that either (i) such insurance is not available at a commercially reasonable rate and the subject hazards are at the time not commonly insured against by prudent owners of properties similar to the Mortgaged Property located in or around the region in which such Mortgaged Property is located or (ii) such insurance is not available at any rate. Subject to Section 3.17(b) , the Special Servicer shall also use reasonable efforts to cause to be maintained for each REO Property no less insurance coverage than was previously required of the Obligor under the related Mortgage or Lease and at a minimum, (i) hazard insurance with a replacement cost rider and (ii) comprehensive general liability insurance, in each case, in an amount customary for the type and geographic location of such REO Property and consistent with the Servicing Standard; provided , that all such insurance shall be obtained from Qualified Insurers that, if they are providing casualty insurance, shall have a claims-paying ability rated at least “A:VIII” by A.M. Best’s Key Rating Guide and “A” by S&P. The cost of any such insurance coverage obtained by either the Property Manager or the Special Servicer shall be a Property Protection Advance to be paid by the Property Manager. All such insurance policies shall contain (if they insure against loss to property) a “standard” mortgagee clause, with loss payable to the Property Manager, as agent of and for the account of the applicable Issuer and the Indenture Trustee, and shall be issued by an insurer authorized under applicable law to issue such insurance. Any amounts collected by the Property Manager or the Special Servicer under any such policies (other than amounts to be applied to the restoration or repair of the related Mortgaged Property or amounts to be released to the related Tenant, in each case in accordance with the Servicing Standard) shall be deposited in the Collection Account, subject to withdrawal pursuant to Section 2.11 of the Indenture.        (b)  The Property Manager or Special Servicer may satisfy its obligations under Section 3.07(a)  by obtaining, maintaining or causing to be maintained a blanket or forced place insurance policy. If applicable, the Property Manager or the Special Servicer shall obtain and maintain, or cause to be obtained and maintained on behalf of each applicable Issuer, a master forced place insurance policy or a blanket policy (or an endorsement to an existing policy) insuring against hazard losses (not otherwise insured by a Tenant or Borrower due to a default by such Tenant or Borrower under the insurance covenants of its Lease or Mortgage Loan or because a Tenant or Borrower permitted to self-insure fails to pay for casualty losses) on the applicable Mortgaged Properties that it is required to service and administer, which policy shall (i) be obtained from a Qualified Insurer having a claims-paying ability rated at least “A:VIII” by A.M. Best’s Key Rating Guide and at least “A” by S&P, and (ii) provide protection equivalent to the individual policies otherwise required under Section 3.07(a) . The Property Manager and the Special Servicer shall bear the cost of any premium payable in respect of any such blanket policy (other than blanket policies specifically obtained for Mortgaged Properties or REO Properties) without right of reimbursement; provided , that if the Property Manager or the Special Servicer, as the case may be, causes any Mortgaged Property or REO Property to be covered by such blanket policy in order to satisfy such obligations, the incremental costs of such insurance applicable to such Mortgaged Property or REO Property shall constitute, and be reimbursable as, a Property Protection Advance (it being understood that such incremental costs incurred by the Special Servicer shall be paid by the Property Manager to the Special Servicer and that such payment shall constitute, and be reimbursable as, a Property Protection Advance). If the Property                                     59 US-DOCS\ 96557504.7 102826315.7 

 

Manager or Special Servicer, as applicable, causes any Mortgaged Property or REO Property to be covered by a force-placed insurance policy, the incremental costs of such insurance applicable to such Mortgaged Property or REO Property (which shall not include any minimum or standby premium payable for such policy whether or not any Mortgaged Property or REO Property is covered thereby) shall be paid as a Property Protection Advance (it being understood that such incremental costs incurred by the Special Servicer shall be paid by the Property Manager to the Special Servicer and that such payment shall constitute, and be reimbursable as, a Property Protection Advance). Any such policy may contain a deductible clause (not in excess of a customary amount) in which case the Property Manager or the Special Servicer, as appropriate, shall, if there shall not have been maintained on the related Mortgaged Property or REO Property a hazard insurance policy complying with the requirements of Section 3.07(a)  and there shall have been one or more losses that would have been covered by such policy, promptly deposit into the Collection Account from its own funds the amount not otherwise payable under the blanket policy in connection with such loss or losses because of such deductible clause. The Property Manager or the Special Servicer, as appropriate, shall prepare and present, on behalf of itself, the Indenture Trustee and the applicable Issuer, claims under any such blanket policy in a timely fashion in accordance with the terms of such policy. Any payments on such policy shall be made to the Property Manager as agent of and for the account of the applicable Issuer, the Noteholders and the Indenture Trustee.        (c)  Each of the Property Manager, the Special Servicer and the Back-Up Manager shall at all times during the term of this Agreement (or, in the case of the Special Servicer, at all times during the term of this Agreement in which Specially Serviced Assets exist as part of the Collateral) keep in force with a Qualified Insurer having a claims paying ability rated at least “A:VIII” by A.M. Best’s Key Rating Guide and at least “A” by S&P, a fidelity bond in such form and amount as does not adversely affect any rating assigned by any Rating Agency to the Notes; provided , that, unless any Rating Agency then rating any Notes at the request of an Issuer states that the form or amount of any such fidelity bond would be the sole cause of or be a material reason for a downgrade, qualification or withdrawal of any rating then assigned by such Rating Agency to such Notes, the form and amount of such fidelity bond shall be deemed to not adversely affect any rating assigned by any Rating Agency to the Notes. Each of the Property Manager and the Special Servicer shall be deemed to have complied with the foregoing provision if an Affiliate thereof has such fidelity bond coverage and, by the terms of such fidelity bond, the coverage afforded thereunder extends to the Property Manager or the Special Servicer, as the case may be. Such fidelity bond shall provide that it may not be canceled without ten (10) days’ prior written notice to the Issuers.        Each of the Property Manager, the Special Servicer and the Back-Up Manager shall at all times during the term of this Agreement (or, in the case of the Special Servicer, at all times during the term of this Agreement in which Specially Serviced Assets exist as part of the Collateral) also keep in force with a Qualified Insurer having a claims-paying ability rated at least “A: VIII” by A.M. Best’s Key Rating Guide and at least “A” by S&P, a policy or policies of insurance covering loss occasioned by the errors and omissions of its officers, employees and agents in connection with its servicing obligations hereunder, which policy or policies shall name the Indenture Trustee as an additional insured and shall be in such form and amount as does not adversely affect any rating assigned by any Rating Agency to the Notes; provided , that, unless                                     60 US-DOCS\ 96557504.7 102826315.7 

 

any Rating Agency then rating any Notes at the request of an Issuer states that the form or amount of any such insurance would be the sole cause of or be a material reason for a downgrade, qualification or withdrawal of any rating then assigned by such Rating Agency to such Notes, the form and amount of such insurance shall be deemed to not adversely affect any rating assigned by any Rating Agency to the Notes. Each of the Property Manager and the Special Servicer shall be deemed to have complied with the foregoing provisions if an Affiliate thereof has such insurance and, by the terms of such policy or policies, the coverage afforded thereunder extends to the Property Manager or the Special Servicer, as the case may be. Any such errors and omissions policy shall provide that it may not be canceled without ten (10) days’ prior written notice to the Issuers.        Each of the Property Manager and the Special Servicer shall at all times during the term of this Agreement (or, in the case of the Special Servicer, at all times during the term of this Agreement in which Specially Serviced Assets exist as part of the Collateral) also, on behalf of the Issuers, keep in force with a Qualified Insurer having a claims-paying ability rated at least “A:VIIF" by A.M. Best’s Key Rating Guide and at least “A” by S&P, a lessor’s general liability insurance policy or policies, which policy or policies shall be in such form and amount as does not adversely affect any rating assigned by any Rating Agency to the Notes; provided , that, unless any Rating Agency then rating any Notes at the request of an Issuer states that the form or amount of any such insurance would be the sole cause of or be a material reason for a downgrade, qualification or withdrawal of any rating then assigned by such Rating Agency to such Notes, the form and amount of such insurance shall be deemed to not adversely affect any rating assigned by any Rating Agency to the Notes. Any such general liability insurance policy shall provide that it may not be canceled without ten (10) days’ prior written notice to the Issuers and the Indenture Trustee. Any payments on such policy shall be made to the Property Manager as agent of and for the account of any applicable Issuer and the Indenture Trustee.        The insurance described in this clause (c)  shall be required to include coverage in respect of losses that may be sustained as a result of an officer’s or employee’s of the Property Manager or the Special Servicer misappropriation of funds and errors and omissions.        If the Property Manager (or its corporate parent), the Special Servicer (or its corporate parent) or the Back-Up Manager (or its corporate parent), as applicable, are rated not lower than “A2” by Moody’s, “A” by S&P and “A” by Fitch Ratings, Inc., the Property Manager, the Special Servicer or the Back-Up Manager, as applicable, may self-insure with respect to any insurance coverage or fidelity bond coverage required hereunder, in which case it shall not be required to maintain an insurance policy with respect to such coverage; provided , that Spirit Realty may not self-insure with respect to any such insurance coverage or fidelity bond.        Section 3.08 Enforcement of Alienation Clauses; Consent to Assignment .        With respect to those Leases and Mortgage Loans it is obligated to service hereunder, each of the Property Manager and the Special Servicer, on behalf of the Issuers and the Indenture Trustee for the benefit of the holders of the Notes, shall enforce the restrictions contained in the related Lease and Mortgage Loans or in any other document in the related Lease File or Loan File on transfers or further encumbrances of the related Mortgaged Property and Mortgage Loan and on transfers of interests in the related Borrower or Tenant, unless it has determined,                                     61 US-DOCS\ 96557504.7 102826315.7 

 

consistent with the Servicing Standard, that waiver of such restrictions would be in accordance with the Servicing Standard. After having made any such determination, the Property Manager or the Special Servicer, as the case may be, shall deliver to the Indenture Trustee (and the Property Manager in the case of the Special Servicer) an Officer’s Certificate setting forth the basis for such determination. In connection with any assignment or sublet by a Tenant of its interest under a Lease, the applicable Issuer shall not take any action to release such Tenant from its obligations under such Lease unless a new Tenant approved by such Issuer assumes the obligations under such Lease and any applicable requirements set forth in the applicable Lease have been satisfied.        Section 3.09 Realization Upon Specially Serviced Assets.        (a)  If the Special Servicer has determined, in its good faith and reasonable judgment, that any material default related to a Specially Serviced Asset will not be cured by the related Obligor, the Special Servicer will be required to evaluate the possible alternatives available in accordance with the Servicing Standard and this Agreement with respect to such Specially Serviced Asset. Such alternatives may include, among other things, modification or restructuring of the related Mortgage Loan or Lease, sale or exchange of the related Mortgage Loan or Mortgaged Property in accordance with Section 3.18  or the enforcement of remedies available under the related Mortgage Loan or Lease in accordance with Section 3.19 , including foreclosure of the Mortgage Loan or eviction of the Tenant, as applicable, and the re-leasing of the related Mortgaged Property. Subject to all other provisions and limitations set forth herein, the Special Servicer shall take such actions with respect to each Specially Serviced Asset as it determines in accordance with the Servicing Standard, acting in the best interests of the applicable Issuer and the Noteholders. If the Property Manager re-leases any Mortgaged Property, the Property Manager shall deliver to the Indenture Trustee and the Issuers an amended Exhibit A-1  reflecting the addition of such Lease to the Collateral Pool.        (b)  Upon the request of the Special Servicer, the Property Manager shall pay or cause to be paid, as Property Protection Advances or Emergency Property Expenses, as applicable, in accordance with Section 3.17(c) , all costs and expenses (other than costs or expenses that would, if incurred, constitute a Nonrecoverable Property Protection Advance) incurred in connection with each Specially Serviced Asset, and shall be entitled to reimbursement therefor as provided herein and in Section 2.11 of the Indenture. If and when the Property Manager or the Special Servicer deems it necessary and prudent for purposes of establishing the Fair Market Value of any Mortgaged Property related to a Specially Serviced Asset, the Special Servicer or the Property Manager; as the case may be, is authorized to have an appraisal done by an Independent MAI-designated appraiser or other expert (the cost of which appraisal shall be paid by the Property Manager and shall constitute a Property Protection Advance).        (c)  Notwithstanding anything to the contrary contained herein, neither the Property Manager nor the Special Servicer shall, on behalf of the applicable Issuer, obtain title to a Mortgaged Property that secures a Mortgage Loan by deed in lieu of foreclosure or otherwise, or take any other action with respect to any Mortgaged Property that secures a Mortgage Loan, if, as a result of any such action, the applicable Issuer or the Indenture Trustee could, in the reasonable judgment of the Property Manager or the Special Servicer, as the case may be, made in accordance with the Servicing Standard and which shall be based on Opinions of Counsel (of which the Indenture Trustee shall be an addressee) and evidenced by an officer’s certificate                                     62 US-DOCS\ 96557504.7 102826315.7 

 

delivered to the Indenture Trustee, be considered to hold title to, to be a “mortgagee-in- possession” of, or to be an “owner” or “operator” of such Mortgaged Property within the meaning of CERCLA or any comparable law, unless:             (i)   the Property Manager or the Special Servicer, as the case may be, has       previously determined in accordance with the Servicing Standard (and as evidenced by an       officer’s certificate delivered to the Indenture Trustee), based on (x) a Phase I       Environmental Assessment or comparable environmental assessment (and any additional       environmental testing, investigation or analysis that the Property Manager or the Special       Servicer, as applicable, deems necessary and prudent) of such Mortgaged Property       conducted by an Independent Person who regularly conducts such environmental testing,       investigation or analysis, or (y) any environmental testing, investigation and/or analysis       conducted in connection with any related Environmental Policy, and performed during the       twelve-month period preceding any such acquisition of title or other action and in each       case after consultation with an environmental expert, that:                   (A)  the Mortgaged Property is in compliance with applicable                       environmental laws and regulations or, if not, that it would                       maximize the recovery to the applicable Issuer on a present value                       basis (the relevant discounting of anticipated collections to be                       performed at the relevant interest rate for the applicable Mortgage                       Loan or the capitalization rate used in respect of the Lease for any                       Mortgaged Property) to acquire title to or possession of the                       Mortgaged Property and to effect such compliance, which                       determination shall take into account any coverage afforded under                       any related Environmental Policy with respect to such Mortgaged                       Property; and                   (B)  there are no circumstances or conditions present at the Mortgaged                       Property relating to the use, management or disposal of Hazardous                       Materials for which investigation, testing, monitoring, containment,                       clean-up or remediation could be required under any currently                       applicable environmental laws and regulations or, if such                       circumstances or conditions are present for which any such action                       could reasonably be expected to be required, that it would                       maximize the recovery to the applicable Issuer on a present value                       basis (the relevant discounting of anticipated collections to be                       performed at the relevant interest rate for the applicable Mortgage                       Loan or the capitalization rate used in respect of the Lease for any                       Mortgaged Property) to acquire title to or possession of the                       Mortgaged Property and to take such actions, which determination                       shall take into account any coverage afforded under any related                       Environmental Policy with respect to such Mortgaged Property; or             (ii)  in the event that the conditions set forth in clauses (i)(A)  or (i)(B)  are not       satisfied, it shall have notified the Indenture Trustee in writing that it has determined that       the applicable Issuer or the Indenture Trustee could not reasonably be considered to be a                                     63 US-DOCS\ 96557504.7 102826315.7 

 

      potentially responsible party (which determination may be based on an Opinion of       Counsel the cost of which shall be a Property Protection Advance).        (d)  Any such determination in clauses (c)(i)  or (c)(ii)  above by the Property Manager or the Special Servicer shall be evidenced by an Officer’s Certificate to such effect delivered to the Indenture Trustee (which the Indenture Trustee shall provide to the Noteholders), the Issuers and, in the case of the Special Servicer, the Property Manager, specifying all of the bases for such determination, such Officer’s Certificate to be accompanied by all related environmental reports. The Property Manager or the Special Servicer, as appropriate, shall undertake reasonable efforts to make the determination referred to in clause (ii)  immediately above, and may conclusively rely on any related  environmental assessments referred to above in making such determination. The cost of any opinions, testing, analysis and investigation and any remedial, corrective or other action contemplated by clause (c)  above, shall be reimbursed, to the extent not paid by an Environmental Insurer or other party with liability for such amounts, to the Property Manager from the Collection Account as a Property Protection Advance, subject to Section 5.03 .        (e)  If the Property Manager or Special Servicer, as applicable, determines (in accordance with Section 3.09(c))  that any of the conditions set forth in Section 3.09(c)(i)  or (ii) above have not been satisfied with respect to any such Mortgaged Property, the Property Manager or Special Servicer, as applicable, shall take such action as is in accordance with the Servicing Standard and, at such time as it deems appropriate, may, on behalf of the applicable Issuer and the Indenture Trustee, release all or a portion of such Mortgaged Property from the lien of the related Mortgage; provided , that prior to the release of all or a portion of the related Mortgaged Property from the lien of the related Mortgage, (x) the Property Manager or the Special Servicer, as applicable, shall have notified the Indenture Trustee in writing of its intention to so release all or a portion of such Mortgaged Property and (y) the Indenture Trustee shall have notified the Controlling Parties in writing of the Property Manager’s intention to so release all or a portion of such Mortgaged Property. The Indenture Trustee shall execute and deliver such instruments of transfer or assignment, in each case without recourse, as shall be provided to it by the Property Manager and are reasonably necessary to release any lien on or security interest in such Mortgaged Property.        (f)  The Property Manager or the Special Servicer, as applicable, shall report to the Indenture Trustee and the Property Manager (if applicable) monthly in writing as to any actions taken by such party with respect to any Mortgaged Property as to which the environmental testing contemplated in Section 3.09(c)  has revealed that any of the conditions set forth in either Section 3.09(c)(i)(A)  or (i)(B)  have not been satisfied, in each case until such matter has been resolved.        (g)  The   Special Servicer shall have the right to determine, in accordance with the Servicing Standard, the advisability of seeking to obtain a deficiency judgment if the state in which the Collateral securing a Specially Serviced Loan is located and the terms of the Mortgage Loan permit such an action and shall, in accordance with the Servicing Standard, seek such deficiency judgment if it deems advisable.        (h)  The Special Servicer shall prepare and file the reports of foreclosures and abandonments of any Mortgaged Property and the information returns relating to cancellation of                                     64 US-DOCS\ 96557504.7 102826315.7 

 

indebtedness income with respect to any Mortgaged Property required by Sections 6050J and 6050P of the Code and promptly deliver to the Indenture Trustee an Officer’s Certificate stating that such reports have been filed. Such reports shall be in form and substance sufficient to meet the reporting requirements imposed by Sections 6050J and 6050P of the Code.        (i)  All sales of Mortgaged Properties pursuant to this Section 3.09 shall be conducted in accordance with the provisions of Section 3.18  and Article VII , as applicable.        Section 3.10 Issuers , Custodian and Indenture Trustee to Cooperate; Release of Lease Files and Loan Files .        (a)  If from time to time, and as appropriate for servicing of any Mortgage Loan, Lease, assumption of a Lease, modification of a Lease or the re-lease or sale of any Mortgaged Property, the Property Manager or the Special Servicer shall otherwise require the use of any Lease File or Loan File, as applicable (or any portion thereof), the Custodian, upon request of the Property Manager and receipt from the Property Manager of a Request for Release substantially in the form of Exhibit B  attached hereto signed by a Servicing Officer thereof, or upon request of the Special Servicer and receipt from the Special Servicer of a Request for Release substantially in the form of Exhibit C  attached hereto, shall release such Lease File or Loan File, as applicable (or portion thereof), to the Property Manager or the Special Servicer, as the case may be. Upon return of such Lease File or Loan File, as applicable (or portion thereof), to the Custodian, or upon the Special Servicer’s delivery to the Indenture Trustee of an Officer’s Certificate stating that (i) such Lease or Mortgage Loan has been liquidated and all amounts received or to be received in connection with such Lease or Mortgage Loan are required to be deposited into the Collection Account pursuant to Section 3.04(a)  have been or will be so deposited or (ii) such Mortgaged Property has been sold, a copy of the Request for Release shall be released by the Indenture Trustee to the Property Manager or the Special Servicer, as applicable.        (b)  Within seven (7) Business Days of the Special Servicer’s request therefor (or, if the Special Servicer notifies the Issuers and the Indenture Trustee of an exigency, within such shorter period as is reasonable under the circumstances), each of the applicable Issuer and the Indenture Trustee shall execute and deliver to the Special Servicer, in the form supplied to the applicable Issuer and the Indenture Trustee by the Special Servicer, any court pleadings, leases, sale documents or other documents reasonably necessary to the re-lease, foreclosure or sale in respect of any Mortgage Loan or Mortgaged Property or to any legal action brought to obtain judgment against any Obligor on the related Lease or Mortgage Loan or to obtain a judgment against an Obligor, or to enforce any other remedies or rights provided by the Lease or Mortgage Loan or otherwise available at law or in equity or to defend any legal action or counterclaim filed against the applicable Issuer, the Property Manager or the Special Servicer; provided , that each of the applicable Issuer and the Indenture Trustee may alternatively execute and deliver to the Special Servicer, in the form supplied to the applicable Issuer and the Indenture Trustee by the Special Servicer, a limited power of attorney substantially in the form of Exhibit D issued in favor of the Special Servicer and empowering the Special Servicer to execute and deliver any or all of such pleadings, leases, sale documents or other documents on behalf of the applicable Issuer or the Indenture Trustee, as the case may be; provided, however , that neither the applicable Issuer nor the Indenture Trustee shall be held liable for any misuse of such power of attorney by the Special Servicer. Together with such pleadings, leases, sale documents or documents (or such                                     65 US-DOCS\ 96557504.7 102826315.7 

 

power of attorney empowering the Special Servicer to execute the same on behalf of the applicable Issuer and the Indenture Trustee), the Special Servicer shall deliver to each of the applicable Issuer and the Indenture Trustee an Officer’s Certificate requesting that such pleadings, leases, sale documents or other documents (or such power of attorney empowering the Special Servicer to execute the same on behalf of the applicable Issuer or the Indenture Trustee, as the case may be) be executed by the applicable Issuer or the Indenture Trustee and certifying as to the reason such pleadings or documents are required.        (c)  Upon the payment in full of any Mortgage Loan, or the receipt by the Property Manager of a notification that payment in full shall be escrowed in a manner customary for such purposes, the Property Manager shall promptly notify the Custodian and the Indenture Trustee by a certification (which certification shall be in the form of a Request for Release substantially in the form of Exhibit B  attached hereto, shall be accompanied by the form of any necessary release or discharge and shall include a statement to the effect that all amounts received or to be received in connection with such payment which are required to be deposited in the Collection Account pursuant to Section 3.04(a)  have been or will be so deposited) of a Servicing Officer (a copy of which certification shall be delivered to the Special Servicer) and shall request delivery to it and release of the related Loan File. Upon receipt of such certification and request, the Custodian shall promptly cause the release of the related Loan File to the Property Manager and the Indenture Trustee shall deliver to the Property Manager such release or discharge, duly executed. Except customary fees and expenses, no expenses incurred in connection with any instrument of satisfaction or deed of reconveyance shall be chargeable to the Collection Account or other amounts that constitute Collateral.        Section 3.11 Servicing Compensation; Interest on Property Protection Advances .        (a)  As compensation for its activities hereunder, the Property Manager shall be entitled to receive the Property Management Fee with respect to each Mortgaged Property and Mortgage Loan included in the Collateral Pool. As to each such Mortgaged Property and Mortgage Loan included in the Collateral Pool, the Property Management Fee shall accrue daily at the related Property Management Fee Rate on the basis of the Collateral Value of each such Mortgaged Property and Mortgage Loan and shall be calculated with respect to each Mortgage Loan on the same basis as interest accrues on such Mortgage Loan and with respect to each Mortgaged Property on a 30/360 Basis. The right to receive the Property Management Fee may not be transferred in whole or in part except in connection with the transfer of all of the Property Manager’s responsibilities and obligations under this Agreement. Earned but unpaid Property Management Fees shall be payable monthly out of general collections on deposit in the Collection Account pursuant to Section 3.05  and Section 2.11 of the Indenture.        (b)  On each Remittance Date, the Property Manager shall be entitled to receive: (i) all returned check fees, assumption, modification and similar fees and late payment charges from Obligors with respect to Mortgaged Properties, Leases and Mortgage Loans that are not Specially Serviced Assets as of such Remittance Date; and (ii) any default interest collected on a Mortgaged Property, Lease or Mortgage Loan, but only to the extent that (x) such default interest is allocable to the period (not to exceed 60 days) when such Mortgaged Property, Lease or Mortgage Loan did not constitute a Specially Serviced Asset and (y) such default interest is not allocable to reimburse the Property Manager, the Back-Up Manager or the Indenture Trustee                                     66 US-DOCS\ 96557504.7 102826315.7 

 

with respect to any Property Protection Advances or interest thereon made in respect of such Mortgage Loan, Lease or Mortgaged Property (collectively, the “ Property Manager Additional Servicing Compensation ”).        (c)  As compensation for its activities hereunder, the Special Servicer shall be entitled to receive the Special Servicing Fee with respect to each Specially Serviced Asset. As to each Specially Serviced Asset, the Special Servicing Fee shall accrue daily from time to time at the Special Servicing Fee Rate on the basis of the Collateral Value of such Specially Serviced Asset and shall be calculated with respect to each Specially Serviced Loan on the same basis as interest accrues on such Specially Serviced Loan and with respect to each Mortgaged Property related to a Specially Serviced Lease on a 30/360 Basis. The Special Servicing Fee with respect to any Specially Serviced Asset shall (subject to Section 3.20  hereof) cease to accrue if (i) the related Mortgaged Property is sold or exchanged for a Qualified Substitute Mortgaged Property or the Specially Serviced Loan is sold or exchanged for a Qualified Substitute Mortgage Loan, as applicable, or (ii) such Specially Serviced Asset becomes a Corrected Lease or a Corrected Loan, as applicable, or (iii) such Specially Serviced Asset becomes a Liquidated Lease or liquidated Mortgage Loan, as applicable. Earned but unpaid Special Servicing Fees shall be payable monthly out of collections on deposit in the Collection Account pursuant to Section 3.05 hereof and Section 2.11 of the Indenture.        The Special Servicer’s right to receive the Special Servicing Fee may not be transferred in whole or in part except in connection with the transfer of all of the Special Servicer’s responsibilities and obligations under this Agreement.        (d)  Subject to the last sentence of this Section 3.11(d) , on each Remittance Date, the Special Servicer shall be entitled to receive: (i) all returned check fees, assumption, modification and similar fees and late payment charges received on or with respect to the Specially Serviced Assets (determined as of the Remittance Date relating to such Payment Date); and (ii) any default interest collected on a Specially Serviced Asset (to the extent that such default interest is not allocable to reimburse the Property Manager, Indenture Trustee or Back-Up Manager with respect to any Property Protection Advances made in respect of the related Mortgage Loan, Lease or Mortgaged Property or interest thereon and such default interest is not allocable to the Property Manager under Section 3.11(b))  as additional servicing compensation (collectively, the “Special Servicer Additional Servicing Compensation ”). Notwithstanding the foregoing, if the Special Servicer is terminated at a time when no Servicer Replacement Event existed with respect to the Special Servicer and such Special Servicer was servicing or administering any Specially Serviced Asset as of the date of such termination, and such servicing or administration had been continuing for at least two (2) months, then the terminated Special Servicer will be entitled to 50% of all modification fees earned by its successor with respect to such Specially Serviced Asset during the 12-month period following the date of such termination.        (e)  As and to the extent permitted by Section 2.11 of the Indenture, the Property Manager, Indenture Trustee and the Back-Up Manager, as applicable, shall each be entitled to receive Advance Interest on the amount of each Advance made thereby for so long as such Advance is outstanding. The Property Manager and the Back-Up Manager shall be reimbursed                                      67 US-DOCS\ 96557504.7 102826315.7 

 

for Property Protection Advances in accordance with Sections 3.03(d) and 3.05(a)  and (b), and Section 2.11 of the Indenture.        Except as otherwise expressly set forth herein, the Property Manager and the Special Servicer shall each be required to pay all ordinary expenses incurred by it in connection with its servicing activities under this Agreement, including fees of any subservicers retained by it. In addition, the Property Manager and the Special Servicer shall not be reimbursed for its own internal costs and expenses and overhead expenses, such as office space expenses, office equipment costs, supply costs or employee salaries or related costs and expenses.        (f)  A Workout Fee shall be payable to the Special Servicer with respect to each Corrected Loan or Corrected Lease. As to each such Corrected Loan or Corrected Lease, the Workout Fee will be payable out of, and shall be calculated by application of the Workout Fee Rate to, each collection of rents, interest (other than Default Interest) and principal (including scheduled payments, prepayments, Balloon Payments and payments at maturity) received on such Corrected Loan or Corrected Lease, as applicable, so long as it remains a Corrected Lease or Corrected Loan; provided , that no Workout Fee shall be payable from, or based upon the receipt of, Liquidation Proceeds collected in connection with (i) the purchase of any Specially Serviced Loan, Mortgaged Property related to any Specially Serviced Lease or REO Property by the Property Manager or the Special Servicer or (ii) the repurchase of any Specially Serviced Loan or Mortgaged Property related to any Specially Serviced Lease by the Originator or Support Provider due to a Collateral Defect within the period provided to the Originator and Support Provider to cure such Collateral Defect. In addition, no Workout Fee shall be payable with respect to any Corrected Loan or Corrected Lease if and to the extent (i) such Mortgage Loan again becomes a Specially Serviced Loan under clause (b)  of the definition of “Specially Serviced Loan” or the Lease again becomes a Specially Serviced Lease under clause (b)  of the definition of “Specially Serviced Lease” and (ii) no default under the Mortgage Loan or Lease, as applicable, actually occurs, or if such default has occurred, it is remedied within the 60 days provided in such clauses. Except as provided in the preceding sentence, for the avoidance of doubt, a new Workout Fee will become payable if and when a Mortgage Loan or Lease that ceased to be a Corrected Lease or Corrected Loan again becomes a Corrected Lease or Corrected Loan. If the Special Servicer is terminated (with or without cause) or resigns with respect to any or all of its servicing duties, it shall retain the right to receive any and all Workout Fees payable with respect to the Mortgage Loans or Leases that became Corrected Loans or Corrected Leases during the period that it had responsibility for servicing Specially Serviced Assets (and the successor Special Servicer shall not be entitled to any portion of such Workout Fees), in each case until the Workout Fee for any such Corrected Loan or Corrected Lease ceases to be payable in accordance with the second preceding sentence. If the Special Servicer is terminated for any reason or resigns as Special Servicer hereunder, and prior to such resignation or termination, any Specially Serviced Asset would have been a Corrected Loan or Corrected Lease but for the related Borrower or Tenant, as applicable, not yet having made three full and consecutive Monthly Payments as provided in the Lease Documents or Loan Documents, then such terminated or resigning Special Servicer shall be entitled to all, and the Successor Special Servicer shall be entitled to none, of the Workout Fee payable in connection with such Specially Serviced Asset after it actually becomes a Corrected Loan or Corrected Lease, as applicable.                                      68 US-DOCS\ 96557504.7 102826315.7 

 

      (g)  A Liquidation Fee shall be payable to the Special Servicer with respect to (i) each Mortgage Loan or Mortgaged Property repurchased by the related Originator or the Support Provider due to a Collateral Defect if purchased after the applicable cure period, and shall equal the product of (x) the repurchase price with respect to any such repurchase and (y) the Liquidation Fee Rate, (ii) any Specially Serviced Asset as to which the Special Servicer obtains a full, partial or discounted payoff from the related Borrower of a Mortgage Loan or for some or all of the Collateral Value from the Mortgaged Property related to a Lease from the Tenant, and shall equal the product of (x) the amount of any such payoff and (y) the Liquidation Fee Rate, or (iii) any Specially Serviced Asset or REO Property as to which the Special Servicer recovers any Liquidation Proceeds, and shall equal the product of (x) the amount of such Liquidation Proceeds and (y) the Liquidation Fee Rate; provided , that no Liquidation Fee shall be payable from, or based upon the receipt of, Liquidation Proceeds collected in connection with the purchase of any Specially Serviced Loan, Mortgaged Property related to any Specially Serviced Lease or REO Property by the Property Manager or the Special Servicer.        (h)  As compensation for its activities hereunder, the Back-Up Manager shall be entitled to receive the Back-Up Fee with respect to each Mortgaged Property and Mortgage Loan included in the Collateral Pool. As to each such Mortgaged Property and Mortgage Loan included in the Collateral Pool, the Back-Up Fee shall accrue each day at the related Back-Up Fee Rate on the basis of the Collateral Value of each such Mortgaged Property and Mortgage Loan. The right to receive the Back-Up Fee may not be transferred in whole or in part except in connection with the transfer of all of the Back-Up Manager’s responsibilities and obligations under this Agreement. Earned but unpaid Back-Up Fees shall be payable monthly pursuant to Section 3.05(a)  and Section 2.11 of the Indenture.        Section 3.12 Property Inspections; Collection of Financial Statements; Delivery of Certain Reports .        (a)  If a Lease or Mortgage Loan becomes a Specially Serviced Asset, the Special Servicer shall perform a physical inspection of the related Mortgaged Property as soon as practicable thereafter and, if such Lease or Mortgage Loan remains a Specially Serviced Asset for more than two years, at least annually thereafter so long as such Lease or Mortgage Loan remains a Specially Serviced Asset. The Special Servicer shall prepare a written report of each such inspection performed by it that sets forth in detail the condition of the related Mortgaged Property and that specifies the existence of (i) any sale, abandonment or transfer of such Mortgaged Property, or (ii) any change in the condition or value of such Mortgaged Property that it, in its good faith and reasonable judgment, considers material. The Special Servicer shall deliver to the Issuers, the Indenture Trustee, the Property Manager and the Rating Agencies a copy of each such written report prepared by it within 15 days of the completion of each such inspection. The Special Servicer (i) shall receive reimbursement for reasonable out-of-pocket expenses related to any such inspection and (ii) shall be entitled to a reasonable inspection fee for any such inspection, in each case from the applicable Issuers pursuant to Section 2.11(b) of the Indenture.        (b)  The Special Servicer, in the case of any Specially Serviced Asset, and the Property Manager, in the case of all other Leases and Mortgage Loans, shall make reasonable efforts to collect promptly from each related Obligor and review annual operating statements of the related                                     69 US-DOCS\ 96557504.7 102826315.7 

 

Mortgaged Properties and financial statements of such Obligor required to be provided under the applicable Mortgage Loan or Lease.        (c)  Not later than December 15 of each year, commencing December 15, 2014, the Property Manager shall deliver to the Issuers, the Indenture Trustee and the Special Servicer (i) from information, if any, that the Property Manager has most recently received pursuant to Section 3.12(b) , a report setting forth the aggregate Fixed Charge Coverage Ratios of all Mortgaged Properties with respect to which it has received sufficient financial information from the applicable Obligor(s) to permit it to calculate such Fixed Charge Coverage Ratio (either at the “unit” level, master lease level or corporate level, as applicable) and, in each case, identifying the period covered by the related financial statements in its possession, and (ii) a schedule, in the form of the Mortgaged Property Schedule or Mortgage Loan Schedule, as applicable, prepared as of the later of (1) the most recent Series Closing Date and (2) the most recent Transfer Date, and further identifying on such schedule each Lease or Mortgage Loan (x) that has become a Liquidated Lease or liquidated Mortgage Loan since the most recent delivery of such schedule pursuant to this Section 3.12(c)(ii)  (or, in the case of the first such delivery, since the Series Closing Date), and specifying the date on which the sale or re-lease of the related Mortgaged Property or Mortgage Loan occurred or (y) that has otherwise terminated in accordance with its terms and, in each case, specifying the date of such sale, re-lease or termination, the amount collected in connection therewith and the amount of any unreimbursed Property Protection Advances, Emergency Property Expenses, Extraordinary Expenses and other amounts due and unpaid under the related Mortgage Loan or Lease incurred in connection therewith.        Section 3.13 Annual Statement as to Compliance .        Each of the Property Manager and the Special Servicer shall deliver to the Issuers, to the Indenture Trustee and, in the case of the Special Servicer, to the Property Manager, as soon as available, and in any event by the 15 th  day after each March 31 of each year (or the next succeeding Business Day if any such day is not a Business Day) beginning in March 2015, an Officer’s Certificate stating, as to each officer signatory thereof, that (i) a review of the activities of the Property Manager or the Special Servicer, as the case may be, during the prior calendar year, and of its performance under this Agreement, has been made under the supervision of the signatories signing such Officer’s Certificate, and (ii) to the best of such signatory’s knowledge, based on such review, the Property Manager or the Special Servicer, as the case may be, complied in all material respects throughout such period with the minimum servicing standards in this Agreement and fulfilled in all material respects throughout such period its obligations under this Agreement or, if there was noncompliance with such standards or a default in the fulfillment of any such obligation in any material respect, such Officer’s Certificate shall include a description of such noncompliance or specify each such default, as the case may be, known to such signatory and the nature and status thereof.        Section 3.14 Reports by Independent Public Accountants.        On or before March 31 of each year, beginning in March 2015, each of the Property Manager and the Special Servicer, at its expense, shall cause an independent, registered public accounting firm (which may also render other services to the Property Manager or the Special Servicer, as the case may be) to furnish to the Issuers and the Indenture Trustee and, in the case                                     70 US-DOCS\ 96557504.7 102826315.7 

 

of the Special Servicer, to the Property Manager a report containing such firm’s opinion that, on the basis of an examination conducted by such firm substantially in accordance with standards established by the American Institute of Certified Public Accountants, the officer’s assertion made pursuant to Section 3.13  by the Property Manager or the Special Servicer, as the case may be, is fairly stated in all material respects, subject to such exceptions and other qualifications that, in the opinion of such firm, such institute’s standards require it to report and that such examination included tests in accordance with the requirements of the Uniform Single Attestation Program for Mortgage Bankers, to the extent the procedures in such program are applicable to the servicing obligations set forth in this Agreement. In rendering such statement, such firm may rely, as to matters relating to direct servicing of leases and mortgage loans by Sub-Managers, upon comparable reports for examinations conducted substantially in accordance with such institute’s standards (rendered within one year of such report) of independent public accountants with respect to the related Sub-Manager.        Section 3.15 Access to Certain Information; Delivery of Certain Information .        (a)  Each of the Property Manager and the Special Servicer shall afford to the other, to the Issuers, the Indenture Trustee, the Back-Up Manager and the Rating Agencies and to the OTS, the FDIC and any other banking or insurance regulatory authority that may exercise authority over any holder of Notes or LLC Interests, reasonable access to any documentation regarding the Leases, Mortgage Loans and Mortgaged Properties and its servicing thereof within its control, except to the extent it is prohibited from doing so by applicable law, rule or regulation or contract or to the extent such information is subject to a privilege under applicable law. Such access shall be afforded without charge but only upon reasonable prior written request and during normal business hours at the offices of the Property Manager or the Special Servicer, as the case may be, designated by it.        (b)  The Property Manager or the Special Servicer shall notify the Rating Agencies, the Back-Up Manager and the Indenture Trustee of any Mortgaged Property whose Tenant has ceased to exercise its business activity on such Mortgaged Property within 30 days of becoming aware of such a circumstance.        Section 3.16 Title to REO Property .        (a)  If title to any REO Property is acquired by the Special Servicer on behalf of the Issuer, the deed or certificate of sale shall be issued to the applicable Issuer. Upon acquisition of such REO Property, the Special Servicer shall, if any amounts remain due and owing under the related Mortgage Note, cause the applicable Issuer to execute and deliver to the Indenture Trustee or the Collateral Agent a new Mortgage (along with appropriate Financing Statements), as applicable, in favor of the Indenture Trustee or the Collateral Agent to secure the lien of the Indenture.        (b)  The Special Servicer shall remit to the Property Manager for deposit in the Collection Account or Release Account, as applicable, upon receipt, all REO Revenues, Property Insurance Proceeds and Liquidation Proceeds received in respect of an REO Property or Specially Serviced Asset.                                     71 US-DOCS\ 96557504.7 102826315.7 

 

      Section 3.17 Management of REO Properties and Mortgaged Properties relating to Defaulted Assets .        (a)  [Reserved].        (b)  At any time that a Mortgaged Property is not subject to a Mortgage Loan or a Lease or is subject to a Mortgage Loan or a Lease that is (or relates to) a Defaulted Asset or with respect to an REO Property or a Terminated Lease Property, the Special Servicer’s decision as to how such Mortgaged Property or REO Property shall be managed and operated shall be based on the good faith and reasonable judgment of the Special Servicer as to the best interest of the applicable Issuer and the Noteholders by maximizing (to the extent commercially feasible) the net after-tax revenues received by the applicable Issuer with respect to such property and, to the extent consistent with the foregoing, in the same manner as would commercial loan and lease servicers and asset managers operating property comparable to the respective Mortgaged Property, REO Property or Terminated Lease Property under the Servicing Standard. The applicable Issuer, the Indenture Trustee and the Special Servicer may consult with counsel at the expense of the applicable Issuer in connection with determinations required under this Section 3.17(b) . Neither the Indenture Trustee nor the Special Servicer shall be liable to the Issuers, the holders of the Notes, the other parties hereto or each other, nor shall the applicable Issuer be liable to the other Issuers, any such holders or to the other parties hereto, for errors in judgment made in good faith in the exercise of their discretion while performing their respective duties, obligations and responsibilities under this Section 3.17(b) . Nothing in this Section 3.17(b)  is intended to prevent the sale or re-lease of a Mortgaged Property, REO Property or Terminated Lease Property pursuant to the terms and subject to the conditions of Section 3.18  and Article VII , as applicable.        (c)  The Special Servicer shall have full power and authority to do any and all things in connection with the servicing and administration of any Defaulted Asset and Mortgaged Property subject to a Defaulted Asset and any REO Property or Terminated Lease Property as are consistent with the Servicing Standard and, consistent therewith, shall request that the Property Manager make, and the Property Manager shall make, Property Protection Advances, or pay (or cause to be paid) Emergency Property Expenses from funds on deposit in the Collection Account, necessary for the proper operation, management, maintenance and disposition of such Mortgaged Property, REO Property or Terminated Lease Property, including:             (i)   all insurance premiums due and payable in respect of such Mortgaged       Property, REO Property or Terminated Lease Property;             (ii)  all real estate and personal property taxes and assessments in respect of       such Mortgaged Property, REO Property or Terminated Lease Property that may result       in the imposition of a lien thereon (including taxes or other amounts that could constitute       liens prior to or on parity with the lien of the related Mortgage);             (iii) [Reserved]; and                                      72 US-DOCS\ 96557504.7 102826315.7 

 

           (iv)  all costs and expenses necessary to maintain, lease, sell, protect, manage,       operate and restore such Mortgaged Property, REO Property or Terminated Lease       Property.  Notwithstanding the foregoing, the Property Manager shall have no obligation to make any such Property Protection Advance if (as evidenced by an Officer’s Certificate delivered to the applicable Issuer and the Indenture Trustee) the Property Manager determines, in accordance with the Servicing Standard, that such payment would be a Nonrecoverable Property Protection Advance. The Special Servicer shall submit requests to make Property Protection Advances to the Property Manager not more than once per month unless the Special Servicer determines on an emergency basis in accordance with the Servicing Standard that earlier payment is required to protect the interests of the Issuers and the Noteholders.        Section 3.18 Sale and Exchange of Mortgage Loans , Leases and Mortgaged Properties .        (a)  The Property Manager, the Special Servicer and the applicable Issuer may sell or purchase, or permit the sale or purchase of, a Mortgage Loan or Mortgaged Property only on the terms and subject to the conditions set forth in this Section 3.18  or as otherwise expressly provided in or contemplated hereunder. Except with respect to repurchases or substitutions by a related Originator or the Support Provider due to a Collateral Defect, an Issuer may only sell or exchange a Mortgaged Property or Mortgage Loan to or with any of its Affiliates subject to the applicable conditions (if any) set forth in the Indenture (including any applicable Series Supplement) and herein.        (b)  The Special Servicer shall act on behalf of the applicable Issuer and the Indenture Trustee in negotiating and taking any other action necessary or appropriate in connection with the sale of any Defaulted Asset, Lease related to a Defaulted Asset, Terminated Lease Property or REO Property and the collection of all amounts payable in connection therewith. The Special Servicer shall take such actions as it determines in accordance with the Servicing Standard will be in the best interests of the applicable Issuer and the Noteholders, including, in the case of a Terminated Lease Property, the Special Servicer shall use reasonable efforts, consistent with the Servicing Standard, to (i) attempt to induce another Tenant to assume the obligations under the existing Lease, with or without modification, (ii) lease the Terminated Lease Property under a new Lease on economically desirable terms or (iii) dispose of the related Mortgaged Property. The decision to enter into a lease assumption or re-lease the Terminated Lease Property shall be made by the Special Servicer in accordance with the Servicing Standard. If the Special Servicer is successful in re-leasing the related Mortgaged Property, a new Appraised Value will be determined in the Special Servicer’s discretion. Any sale of a Mortgage Loan, Mortgaged Property, Lease, Defaulted Asset, Terminated Lease Property or REO Property shall be free and clear of the lien of the Indenture and shall be final and without recourse to the applicable Issuer or the Indenture Trustee. If such sale is consummated in accordance with the terms of this Agreement, none of the Property Manager, the Special Servicer or the Indenture Trustee shall have any liability to the Issuers or any holder of Notes with respect to the purchase price therefor accepted by the Property Manager, the Special Servicer or the Indenture Trustee, as the case may be.                                      73 US-DOCS\ 96557504.7 102826315.7 

 

      Section 3.19 Modifications, Waivers, Amendments and Consents.        (a)  The Property Manager and the Special Servicer each may, consistent with the Servicing Standard, agree to any modification, waiver or amendment of any term of, forgive any Lease or Mortgage Loan payment on, permit the release of the Obligor on or guarantor of, or approve of the assignment of a Tenant’s interest in its Lease with respect to, or the sublease of all or a portion of, any Mortgaged Property, Lease or Mortgage Loan it is required to service and administer hereunder, without the consent of the Issuers, the Indenture Trustee, any holder of Notes or any Controlling Party or Requisite Global Majority; provided ; that (i) in the reasonable judgment of the party agreeing to any such amendment, such amendment will not cause the Current Cashflow Coverage Ratio to be reduced to or below 1.30 or, if the Current Cashflow Coverage Ratio is already equal to or lower than 1.30, will not cause the Current Cashflow Coverage Ratio to be further reduced and (ii) in the reasonable judgment of the party agreeing to any such amendment, such amendment is in the best interest of the Noteholders and will not have an adverse effect on the Collateral Value of the related Mortgaged Property (in the case of any such amendment with respect to a Lease) or Mortgage Loan (in the case of any such amendment with respect to a Mortgage Loan); provided ; that any such amendment (x) in connection with a Delinquent Asset or Defaulted Asset, (y) that is required by the terms of the applicable Lease or Mortgage Loan or (z) with respect to which the Rating Condition is satisfied, shall not be subject to the foregoing restrictions set forth in (i) or (ii) above;        (b)  From time to time, subject to the Servicing Standard and upon satisfaction of the Rating Agency Notification Condition, the Property Manager or Special Servicer, as applicable, shall be entitled (on behalf of the Issuer and the Indenture Trustee) to release an immaterial portion of any Mortgaged Property that it is then administering from the lien of the Indenture and the Mortgage (and simultaneously release the Issuer’s interest in such portion of such Mortgaged Property) or consent to, or make, an immaterial modification with respect to any Mortgaged Property that it is then administering; provided , that, such Property Manager or Special Servicer shall have certified that it reasonably believes that such release or modification (both individually and collectively with any other similar releases or modifications with respect to such Mortgaged Property) will not materially adversely affect (i) the Appraised Value of such Mortgaged Property or (ii) the Noteholders’ or the holders’ of the Related Series Notes interests in such Mortgaged Property;        (c)  The Property Manager and the Special Servicer each may, as a condition to its granting any request by an Obligor for consent, modification, waiver or indulgence or any other matter or thing, the granting of which is within the Property Manager’s or Special Servicer’s, as the case may be, discretion pursuant to the terms of the instruments evidencing or securing the related Lease or Mortgage Loan and is permitted by the terms of such Lease or Mortgage Loan, require that such Obligor pay to it, as Additional Servicing Compensation, a reasonable or customary fee for the additional services performed in connection with such request, together with any related costs and expenses incurred by it; and        (d)  All modifications, waivers, amendments and other actions entered into or taken in respect of a Lease or Mortgage Loan pursuant to this Section 3.19  shall be in writing. Each of the Property Manager and the Special Servicer shall notify the other such party and the Issuers and the Indenture Trustee, in writing, of any modification, waiver, amendment or other action                                     74 US-DOCS\ 96557504.7 102826315.7 

 

entered into or taken in respect of any Lease or Mortgage Loan pursuant to this Section 3.19  and the date thereof, and shall deliver to the Custodian for deposit in the related Lease File or Loan File an original counterpart of the agreements relating to such modification, waiver, amendment or other action, promptly (and in any event within ten (10) Business Days) following the execution thereof.        Section 3.20 Transfer of Servicing Between Property Manager and Special Servicer; Record Keeping .        (a)  Upon determining that a Servicing Transfer Event has occurred with respect to any Lease or Mortgage Loan and if the Property Manager is not also the Special Servicer, the Property Manager shall immediately give notice thereof, and shall deliver the related Servicing File, to the Special Servicer, and shall use its best efforts to provide the Special Servicer with all information, documents (or copies thereof) and records (including records stored electronically on computer tapes, magnetic discs and the like) relating to such Lease or Mortgage Loan reasonably requested by the Special Servicer to enable it to assume its functions hereunder with respect thereto without acting through a Sub-Manager. The Property Manager shall use its best efforts to comply with the preceding sentence within five (5) Business Days of the occurrence of each related Servicing Transfer Event.        Upon determining that a Specially Serviced Asset has become a Corrected Lease or Corrected Loan and if the Property Manager is not also the Special Servicer, the Special Servicer shall immediately give notice thereof, and shall return the related Servicing File, to the Property Manager and, upon giving such notice and returning such Servicing File, to the Property Manager, (i) the Special Servicer’s obligation to service such Corrected Lease or Corrected Loan shall terminate, (ii) the Special Servicer’s right to receive the Special Servicing Fee with respect to such Corrected Lease or Corrected Loan shall terminate, and (iii) the obligations of the Property Manager to service and administer such Lease or Mortgage Loan shall resume, in each case, effective as of the first day of the calendar month following the calendar month in which such notice was delivered and return effected.        (b)  In servicing any Specially Serviced Assets, the Special Servicer shall provide to the Custodian, for the benefit of the Indenture Trustee, originals of documents included within the definition of “Lease File” for inclusion in the related Lease File and “Loan File” for inclusion in the related Loan File (with a copy of each such original to the Property Manager), and copies of any additional related Lease and Mortgage Loan information, including correspondence with the related Obligor.        (c)  Notwithstanding anything in this Agreement to the contrary, in the event that the Property Manager and the Special Servicer are the same Person, all notices, certificates, information and consents required to be given by the Property Manager to the Special Servicer or vice versa shall be deemed to be given without the necessity of any action on such Person’s part.        Section 3.21 Sub-Management Agreements .                                      75 US-DOCS\ 96557504.7 102826315.7 

 

      (a)  The Property Manager and the Special Servicer may enter into Sub-Management Agreements to provide for the performance by third parties of any or all of their respective obligations hereunder; provided , that, in each case, the Sub-Management Agreement: (i) is consistent with this Agreement in all material respects and requires the Sub-Manager to comply with all of the applicable conditions of this Agreement; (ii) provides that if the Property Manager or the Special Servicer, as the case may be, shall for any reason no longer act in such capacity hereunder (including by reason of a Servicer Replacement Event), any Back-Up Manager, Successor Property Manager or Successor Special Servicer, may thereupon assume all of the rights and, except to the extent they arose prior to the date of assumption, obligations of the Property Manager or the Special Servicer, as the case may be, under such agreement or, alternatively, may (or the Indenture Trustee may) terminate such Sub-Management Agreement without cause and without payment of any penalty or termination fee; (iii) provides that the Issuers, the Back-Up Manager, the Indenture Trustee, the other parties hereto and, as and to the extent provided herein, the third party beneficiaries hereof shall be third party beneficiaries under such agreement, but that (except to the extent the Back-Up Manager or Successor Property Manager or Successor Special Servicer assumes the obligations of the Property Manager or the Special Servicer, as the case may be, under the applicable Sub-Management Agreement as contemplated by the immediately preceding clause (ii)  and, in such case, only from the date of such assumption) none of the Issuers, the Indenture Trustee, the Back-Up Manager, any other party hereto, any successor Property Manager or Special Servicer, as the case may be, any holder of Notes or LLC Interests or any other third party beneficiary hereof shall have any duties under such agreement or any liabilities arising therefrom; (iv) permits any purchaser of a Mortgaged Property and any related Lease or Mortgage Loan pursuant to this Agreement to terminate such Sub-Management Agreement with respect to such purchased Mortgaged Property and related Lease or Mortgage Loan at its option and without penalty; (v) does not permit the Sub-Manager to enter into or consent to any modification, waiver or amendment or otherwise take any action on behalf of the Property Manager or Special Servicer, as the case may be, contemplated by Section 3.19  without the written consent of the Property Manager or Special Servicer, as the case may be; and (vi) does not permit the Sub-Manager any rights of indemnification that may be satisfied out of the Collateral (it being understood that any Sub-Manager shall be entitled to recover amounts in respect of Property Protection Advances as described in the following paragraph). In addition, each Sub-Management Agreement entered into by the Property Manager shall provide that such agreement shall terminate with respect to any Lease and the related Mortgaged Property, and any Mortgage Loan serviced thereunder at the time such Lease or Mortgage Loan becomes a Specially Serviced Asset, and each Sub-Management Agreement entered into by the Special Servicer shall relate only to Specially Serviced Assets and shall terminate with respect to any such Lease or Mortgage Loan that ceases to be a Specially Serviced Asset, in each case pursuant to the terms hereof.        The Property Manager and the Special Servicer shall each deliver to the Issuers and the Indenture Trustee copies of all Sub-Management Agreements, and any amendments thereto and modifications thereof, entered into by it, promptly upon its execution and delivery of such documents. References in this Agreement to actions taken or to be taken by the Property Manager or the Special Servicer include actions taken or to be taken by a Sub-Manager on behalf of the Property Manager or the Special Servicer, as the case may be, and in connection therewith, all amounts advanced by any Sub-Manager to satisfy the obligations of the Property                                     76 US-DOCS\ 96557504.7 102826315.7 

 

Manager hereunder to make Advances shall be deemed to have been advanced by the Property Manager out of its own funds and, accordingly, such amounts constituting Advances shall be recoverable by such Sub-Manager in the same manner and out of the same funds as if such Sub- Manager were the Property Manager. For so long as they are outstanding, Advances shall accrue Advance Interest in accordance with the terms hereof, such interest to be allocable between the Property Manager and such Sub-Manager as they may agree. For purposes of this Agreement, the Property Manager and the Special Servicer each shall be deemed to have received any payment, and shall be obligated to handle such payment in accordance with the terms of this Agreement, when a Sub-Manager retained by it receives such payment. The Property Manager and the Special Servicer each shall notify the other, the Issuers and the Indenture Trustee in writing promptly of the appointment by it of any Sub-Manager.        (b)  The Property Manager shall have determined to its commercially reasonable satisfaction that each Sub-Manager shall be authorized to transact business, and shall have obtained all necessary licenses and approvals, in each jurisdiction in which the failure to be so authorized or qualified or to have obtained such licenses would adversely affect its ability to carry out its obligations under the Sub-Management Agreement to which it is a party.        (c)  The Property Manager and the Special Servicer, for the benefit of the Issuers, shall (at no expense to the Issuers or the Indenture Trustee) monitor the performance and enforce the obligations of their respective Sub-Managers under the related Sub-Management Agreements. Such enforcement, including the legal prosecution of claims, termination of Sub- Management Agreements in accordance with their respective terms and the pursuit of other appropriate remedies, shall be in such form and carried out to such an extent and at such time as the Property Manager or the Special Servicer, as applicable, in its good faith and reasonable judgment, would require were it the owner of the Mortgaged Properties and the Mortgage Loans. Subject to the terms of the related Sub-Management Agreement, the Property Manager and the Special Servicer shall each have the right to (in its sole discretion and without the consent of any other person) remove a Sub-Manager retained by it at any time it considers such removal to be in the best interests of the Issuers.        (d)  In the event that the Back-Up Manager has succeeded to the rights and assumed the obligations hereunder, of the Property Manager or the Special Servicer, then the Back-Up Manager shall succeed to the rights and assume the obligations of the Property Manager or the Special Servicer, as applicable, under any Sub-Management Agreement, unless the Indenture Trustee elects to terminate any such Sub-Management Agreement in accordance with its terms. In any event, if a Sub-Management Agreement is to be assumed by the Back-Up Manager, then the predecessor Property Manager or the Special Servicer, as applicable, at its expense, shall, upon request of the Back-Up Manager, deliver to the Back-Up Manager all documents and records relating to such Sub-Management Agreement and the Mortgaged Properties and the Mortgage Loans then being serviced thereunder and an accounting of amounts collected and held on behalf of it thereunder, and otherwise use its best efforts to effect the orderly and efficient transfer of the Sub-Management Agreement to the assuming party.        (e)  Notwithstanding any Sub-Management Agreement, the Property Manager and the Special Servicer shall remain obligated and liable to the Issuers, the Noteholders, the Indenture Trustee and each other for the performance of their respective obligations and duties under this                                     77 US-DOCS\ 96557504.7 102826315.7 

 

Agreement in accordance with the provisions hereof to the same extent and under the same terms and conditions as if each alone were servicing and administering the Mortgage Loans, the Mortgaged Properties and Leases for which it is responsible.        (f)  Except as otherwise expressly provided for herein, the Property Manager or Special Servicer, as applicable, will be solely liable for all fees owed by it to any Sub-Manager, irrespective of whether its compensation pursuant to this Agreement is sufficient to pay such fees.        (g)  Each of the Property Manager and the Special Servicer shall have all the limitations upon liability and all the indemnities for the actions and omissions of any such Sub- Manager retained by it that it has for its own actions hereunder.        (h)  For the avoidance of doubt, this Section 3.21 shall not apply to any delegation of obligations pursuant to Section 6.04(a) following a Permitted Replacement Event or Section 6.04(b) following a Permitted Termination Event.                                  ARTICLE IV                                  REPORTS        Section 4.01 Reports to the Issuers , the Indenture Trustee and the Insurers .        (a)  Not later than 2:00 p.m. (New York City time), three (3) Business Days prior to each Payment Date, the Property Manager shall deliver to each of the Issuers and the Indenture Trustee a report containing the information specified on Exhibit F  hereto, and such other information with respect to the Mortgage Loans, the Leases and Mortgaged Properties as the Indenture Trustee may reasonably request (such report, the “ Determination Date Report ”), reflecting information as of the close of business on the last day of the related Collection Period, in a mutually agreeable electronic format. The Determination Date Report and any written information supplemental thereto shall include such information with respect to the Mortgage Loans, the Leases and Mortgaged Properties as is required by the Indenture Trustee for purposes of making the payments required by Section 2.11(b) of the Indenture and the calculations and reports referred to in Section 6.01 of the Indenture and otherwise therein, in each case as set forth in the written specifications or guidelines issued by any of the Issuers of the Indenture Trustee, as the case may be, from time to time. The Property Manager shall also provide to the Indenture Trustee the wire instructions for the relevant parties to which payments under Section 2.11(b) of the Indenture will be made. The Determination Date Report shall also contain a certification by the Property Manager that the Issuers have not incurred any indebtedness except indebtedness permitted by the Transaction Documents. Such information shall be delivered by the Property Manager to each of the Issuers and the Indenture Trustee in agreed-upon format and such electronic or other form as may be reasonably acceptable to the Issuers and the Indenture Trustee. The Special Servicer shall from time to time (and, in any event, as may be reasonably required by the Property Manager) provide the Property Manager with such information regarding the Specially Serviced Assets as may be necessary for the Property Manager to prepare                                      78 US-DOCS\ 96557504.7 102826315.7 

 

each Determination Date Report and any supplemental information to be provided by the Property Manager to the Issuers or the Indenture Trustee.        (b)  Not later than 2:00 p.m. (New York City time), three (3) Business Days prior to each Payment Date, the Special Servicer shall deliver to the Property Manager and the Indenture Trustee a report containing such information relating to the Specially Serviced Assets and in such form as the Indenture Trustee may reasonably request (such report, the “ Special Servicer Report ”), reflecting information as of the close of business on the last day of the related Collection Period. For the avoidance of doubt, the Special Servicer Report may be included in the Determination Date Report.        (c)  Not later than the 30th day following the end of each calendar quarter, commencing with the quarter ended September 30, 2014, the Special Servicer shall deliver to the Indenture Trustee and the Property Manager a report containing such information and in such form as the Indenture Trustee may reasonably request (such report a “ Modified Collateral Detail and Realized Loss Report ”) with respect to all operating statements and other financial information collected or otherwise obtained by the Special Servicer pursuant to Section 3.12(b) during such calendar quarter.        Section 4.02 Use of Agents .        The Property Manager may at its own expense utilize agents or attorneys-in-fact, including Sub-Managers, in performing any of its obligations under this Article IV , but no such utilization shall relieve the Property Manager from any of such obligations, and the Property Manager shall remain responsible for all acts and omissions of any such agent or attorney-in-fact. The Property Manager shall have all the limitations upon liability and all the indemnities for the actions and omissions of any such agent or attorney-in-fact that it has for its own actions hereunder pursuant to Article V , and (except as set forth in Section 3.21(a))  any such agent or attorney-in-fact shall have the benefit of all the limitations upon liability, if any, and all the indemnities provided to the Property Manager under Section 5.03(a) . Such indemnities shall be expenses, costs and liabilities of the Issuers, and any such agent or attorney-in-fact shall be entitled to be reimbursed (to the same extent the Property Manager would be entitled to be reimbursed) as provided in Section 2.11 of the Indenture.                                   ARTICLE V              THE PROPERTY MANAGER AND THE SPECIAL SERVICER        Section 5.01 Liability of the Property Manager and the Special Servicer .        The Property Manager and the Special Servicer shall be liable in accordance herewith only to the extent of the obligations specifically imposed upon and undertaken by the Property Manager and the Special Servicer, respectively, herein.        Section 5.02 Merger , Consolidation or Conversion of the Property Manager and the Special Servicer .                                      79 US-DOCS\ 96557504.7 102826315.7 

 

      Subject to the following paragraph, the Property Manager and the Special Servicer shall each keep in full effect its existence, rights and franchises as a partnership, corporation, bank or association under the laws of the jurisdiction of its formation, and each will obtain and preserve its qualification to do business as a foreign partnership, corporation, bank or association in each jurisdiction in which such qualification is or shall be necessary to protect the validity and enforceability of this Agreement or any of the Leases and the Mortgage Loans and to perform its respective duties under this Agreement.        Each of the Property Manager and the Special Servicer may be merged or consolidated with or into any Person, or may transfer all or substantially all of its assets to any Person, in which case any Person resulting from any merger or consolidation to which the Property Manager or the Special Servicer is a party, or any Person succeeding to the business of the Property Manager or the Special Servicer, will be the successor Property Manager or the successor Special Servicer, as the case may be, hereunder, and each of the Property Manager and the Special Servicer may transfer any or all of its rights and obligations under this Agreement to any Person; provided , however , that no such successor, surviving Person or transferee shall succeed to the rights of the Property Manager or the Special Servicer unless (a) the Rating Condition is satisfied or (b) such successor is an affiliate of the Property Manager or the Special Servicer and the obligations of such successor hereunder are guaranteed by the Support Provider.        Section 5.03 Limitation on Liability of the Property Manager , the Special Servicer and the Back-Up Manager; Environmental Liabilities .        (a)  None of the Property Manager, the Special Servicer or the Back-Up Manager or any director, partner, member, manager, officer, employee or agent of any such party or Control Person over any of them shall be under any liability to the Issuers, the Indenture Trustee, the Collateral Agent, the Custodian or the holders of the Notes or the LLC Interests or any other Person for any action taken, or not taken, in good faith pursuant to this Agreement, or for errors in judgment; provided , however , that none of the Property Manager, the Special Servicer or the Back-Up Manager shall be protected against any liability that would otherwise be imposed by reason of misfeasance, bad faith or negligence in the performance of obligations or duties hereunder. The Property Manager and the Special Servicer and the Back-Up Manager (each, an “Applicable Party ”) and any director, officer, partner, member, manager, employee or agent of any such person or Control Person of any of them shall be entitled to indemnification by the Issuers, payable, subject to Section 5.04 of the Indenture and pursuant to Section 2.11 of the Indenture, against any loss, liability or expense incurred in connection with the performance of duties or obligations hereunder or under any other Transaction Document or in connection with any legal action that relates to this Agreement or any other Transaction Document; provided , however , that such indemnification shall not extend to any loss, liability or expense incurred by reason of misfeasance, bad faith or negligence in the performance of obligations or duties under this Agreement. Each Applicable Party shall indemnify the Issuers, the Indenture Trustee and the Collateral Agent and any director, officer, employee, agent or Control Person of any of them against any loss, liability or expense resulting from the misfeasance, bad faith or negligence in the performance of such Applicable Party’s duties or obligations under this Agreement. No Applicable Party shall be under any obligation to appear in, prosecute or defend any legal action                                     80 US-DOCS\ 96557504.7 102826315.7 

 

that is not incidental to its respective responsibilities under this Agreement and that in its opinion may involve it in any expense or liability; provided , however , that each Applicable Party shall be permitted, at its sole discretion, to undertake any such action that it may deem necessary or desirable with respect to the enforcement or protection of the rights and duties of the parties hereto or the interests of any Issuer hereunder. In such event, the legal expenses and costs of such action, and any liability resulting therefrom, shall be reimbursed by the Issuers in accordance with Section 2.11(b) of the Indenture.        (b)  The Property Manager shall enforce or pursue in accordance with the Servicing Standard any claim for payment, indemnity or reimbursement available to any of the Issuers or the Indenture Trustee in respect of any environmental liabilities, losses, claims, costs or expenses, including, without limitation, any right to payment under an Environmental Indemnity Agreement or a Performance Undertaking. The Property Manager shall seek payment from the Support Provider for any indemnities due under an Environmental Indemnity Agreement to the extent any such amounts are not paid by the applicable Issuer on a current basis from the Available Amount on any Payment Date in accordance with Section 2.11(b) of the Indenture. Any amounts advanced by Spirit Realty, in its capacity as Property Manager, in respect of environmental matters that are payable by the applicable Issuer under an Environmental Indemnity Agreement and are not reimbursed on a current basis as described above, shall be deemed to be payment by Spirit Realty, in its capacity as Support Provider, and Spirit Realty shall not be entitled to reimbursement of any such amounts as a Property Protection Advance.        Section 5.04 Term of Service; Property Manager and Special Servicer Not to Resign .        Subject to (and without limiting) Section 5.02 , Section 6.04(a)  and Section 6.04(b) , hereof, neither the Property Manager nor the Special Servicer shall resign from the obligations and duties hereby imposed on it, except upon determination that the performance of its duties hereunder is no longer permissible under applicable law or are in material conflict by reason of applicable law with any other activities carried on by it, such other activities causing such a conflict being of a type and nature carried on by the Property Manager or the Special Servicer, as the case may be, at the date of this Agreement. Any such determination permitting the resignation of the Property Manager or the Special Servicer, as applicable, shall be evidenced by an Opinion of Counsel to such effect that shall be delivered to the Issuers and the Indenture Trustee. No such resignation shall become effective until a successor shall have assumed the responsibilities and obligations of the resigning party hereunder. If within one hundred twenty (120) days of the date of such determination, no successor shall have assumed the applicable responsibilities and obligations of the resigning party, such Property Manager or Special Servicer shall be permitted to petition a court of competent jurisdiction to appoint a successor.        Notwithstanding anything to the contrary herein, each of the Property Manager and the Special Servicer may cause all or part of the obligations and duties imposed on it by this Agreement to be assumed by, and may assign part or all of its rights, benefits or privileges hereunder to, another Person; provided , that (i) the assuming party is an Eligible Successor and (ii) unless the assuming party or assignee is an Affiliate of the Property Manager or Special Servicer whose obligations and duties hereunder are guaranteed by the Support Provider, the Rating Condition shall have been satisfied with respect to any such assumption or assignment. Upon any such assignment or assumption, the Property Manager and/or the Special Servicer, as                                     81 US-DOCS\ 96557504.7 102826315.7 

 

applicable, shall be relieved from all liability hereunder for acts or omissions the assuming Person or assignee, as applicable, occurring after the date of such assignment or assumption.        If the Property Manager, Special Servicer or Back-Up Manager shall resign pursuant to this Section 5.04  or be removed pursuant to Section 6.01 , then such resigning Property Manager, Special Servicer or Back-Up Manager, as applicable, must pay all reasonable costs and expenses associated with the transfer of its duties and cooperate reasonably with its successor in order to effect such transfer.        Except as provided herein, neither the Property Manager nor the Special Servicer shall assign or transfer any of its rights, benefits or privileges hereunder to any other Person or delegate to or subcontract with, or authorize or appoint, any other Person to perform any of the duties, covenants or obligations to be performed by it hereunder, or cause any other Person to assume such duties, covenants or obligations. If, pursuant to any provision hereof, all of the duties and obligations of the Property Manager or the Special Servicer are transferred by an assignment and assumption to a successor thereto, the entire amount of compensation payable to the Property Manager or the Special Servicer, as the case may be, that accrues pursuant hereto from and after the date of such transfer shall be payable to such successor.        Section 5.05 Rights of Certain Persons in Respect of the Property Manager and the Special Servicer .        Each of the Property Manager and the Special Servicer shall afford to the other and, also to the Issuers and the Indenture Trustee, upon reasonable notice, during normal business hours, (a) access to all records maintained by it relating to the Mortgage Loans, Mortgaged Properties and Leases included in the Collateral Pool and in respect of its rights and obligations hereunder and (b) access to such of its officers as are responsible for such obligations; provided , that, in no event shall the Property Manager or Special Servicer be required to take any action that violates applicable law, contract or regulation. The Issuers may, but are not obligated to, enforce the obligations of the Property Manager and the Special Servicer hereunder and may, but are not obligated to, perform, or cause a designee to perform, any defaulted obligation of the Property Manager or the Special Servicer hereunder, or, in connection with any such defaulted obligation, exercise the related rights of the Property Manager or the Special Servicer hereunder; provided , however , that neither the Property Manager nor the Special Servicer shall be relieved of any of its obligations hereunder by virtue of such performance by any such Issuer or its designee. The Issuer shall not have any responsibility or liability for any action or failure to act by or with respect to the Property Manager or the Special Servicer.        Section 5.06 [Reserved] .        Section 5.07 Property Manager or Special Servicer as Owner of Notes .        The Property Manager or an Affiliate of the Property Manager, or the Special Servicer or an Affiliate of the Special Servicer, may become the holder of any Notes or any LLC Interests with the same rights (unless otherwise expressly provided in a Transaction Document) as it would have if it were not the Property Manager, the Special Servicer or any such Affiliate. If, at any time during which the Property Manager, the Special Servicer or any of their respective                                     82 US-DOCS\ 96557504.7 102826315.7 

 

Affiliates is the holder of any Note or LLC Interest, the Property Manager or the Special Servicer proposes to take or omit to take action (i) which action or omission is not expressly prohibited by the terms hereof and would not, in the Property Manager or the Special Servicer’s good faith judgment, violate the Servicing Standard, and (ii) which action, if taken, or omission, if made, might nonetheless, in the Property Manager’s or the Special Servicer’s good faith judgment, be considered by other Persons to violate the Servicing Standard, the Property Manager or the Special Servicer may, but need not, seek the approval of the holders of the Notes and the LLC Interests to such action or omission by delivering to the Issuers and the Indenture Trustee a written notice that (a) states that it is delivered pursuant to this Section 5.07 , (b) identifies the portion of Notes and LLC Interests beneficially owned by the Property Manager or the Special Servicer or any Affiliate of the Property Manager or the Special Servicer, and (c) describes in reasonable detail the action that the Property Manager or the Special Servicer, as the case may be, proposes to take or omit. Upon receipt of such notice, the Issuers shall forward such notice to the applicable holders of the LLC Interests. If, at any time, the Requisite Global Majority separately consent in writing to the proposal described in the such notice, and if the Property Manager or the Special Servicer, as the case may be, takes action and/or omits to take action as proposed in such notice, such action and/or omission will be deemed to comply with the Servicing Standard. It is not the intent of the foregoing provision that the Property Manager or the Special Servicer be permitted to invoke the procedure set forth herein with respect to routine servicing matters arising hereunder, but rather in the case of unusual circumstances.                                  ARTICLE VI                       SERVICER REPLACEMENT EVENTS        Section 6.01 Servicer Replacement Events        (a)   “ Servicer Replacement Event ” wherever used herein with respect to the Property Manager or Special Servicer, means any one of the following events:             (i)   any failure by the Property Manager or the Special Servicer to remit or       deposit moneys, as required under the Indenture or this Agreement, to the Collection       Account, the Release Account or the Payment Account, which failure remains       unremedied for two (2) Business Day after the earlier of (x) the date on which notice of       such failure, requiring the same to be remedied, is given to the Property Manager or       Special Servicer, as applicable, by the Indenture Trustee, or to such Property Manager or       Special Servicer, as applicable, and the Indenture Trustee by the Noteholders holding at       least 25% of the Aggregate Series Principal Balance and (y) actual knowledge of such       failure by such Property Manager or Special Servicer, as applicable; or             (ii)  the Property Manager fails to make any P&I Advance as required by this       Agreement;             (iii) the Property Manager fails to make any Property Protection Advance or       fails to pay (or, in the event the Property Manager is Spirit Realty, fails to direct the       Indenture Trustee to pay) any Emergency Property Expenses from funds on deposit in the       Collection Account, in each case as required by the Indenture or this Agreement, which                                     83 US-DOCS\ 96557504.7 102826315.7 

 

      failure remains unremedied for four (4) Business Days after the earlier of (x) the date on       which notice of such failure, requiring the same to be remedied, shall have been given to       such Property Manager by the Indenture Trustee, or to such Property Manager and the       Indenture Trustee by the Noteholders holding at least 25% of the Aggregate Series       Principal Balance and (y) actual knowledge of such failure by such Property Manager; or             (iv)  either the Property Manager or the Special Servicer fails to comply in any       material respect with any other of the covenants or agreements on the part of the       Property Manager or the Special Servicer, as the case may be, contained in this       Agreement, which failure continues unremedied for a period of 30 days after the date on       which written notice of such failure shall have been received by the Property Manager or       the Special Servicer, as applicable; provided , however , that if the failure is capable of       being cured and such Property Manager or Special Servicer is diligently pursuing that       cure, the 30 day period will be extended for another 30 days; or             (v)   any breach on the part of the Property Manager or the Special Servicer of       any representation or warranty contained in this Agreement that materially and adversely       affects the interests of the Issuers or the Noteholders, and that continues unremedied for a       period of 30 days after the date on which notice of such breach is given to the Property       Manager or the Special Servicer, as applicable; provided , however , that if the breach is       capable of being cured and such Property Manager or Special Servicer is diligently       pursuing that cure, the 30 day period will be extended for another 30 days; or             (vi)  (a) the Property Manager or the Special Servicer consents to the       appointment of a receiver, liquidator, trustee or similar official relating to it or relating to       all or substantially all of its assets or admits in writing its inability to pay its debts or takes       other actions indicating its insolvency or inability to pay its obligations; or (b) a decree or       order of a court having jurisdiction in any involuntary case for the appointment of a       receiver, liquidator, trustee or similar official in any bankruptcy, insolvency, readjustment       of debt, marshalling of assets and liabilities or similar proceedings is entered against the       Property Manager or the Special Servicer and the decree or order remains in force for a       period of 60 days; provided , that if any decree or order cannot be discharged, dismissed       or stayed within the 60-day period, such Property Manager or Special Servicer will have       an addition 30 days to effect the discharge, so long as it commenced proceedings to have       the decree or order dismissed within the initial 60-day period and it is continuing to       pursue the discharge; or             (vii) either the Property Manager or Special Servicer assigns any of its       obligations to any third party other than as permitted under this Agreement or any other       Transaction Document and does not remedy such breach within five Business Days of       such assignment; or             (viii) either the Property Manager or the Special Servicer fails to observe any       material reporting requirements under this Agreement, which failure remains unremedied       30 days after the date on which written notice of such failure, requiring the same to be                                      84 US-DOCS\ 96557504.7 102826315.7 

 

      remedied, shall have been given to the Property Manager or the Special Servicer, as       applicable, by any other party to this Agreement or the Indenture Trustee; or             (ix)  any Issuer or the Indenture Trustee has received notice in writing from any       Rating Agency then rating any Notes at the request of an Issuer citing servicing concerns       and stating that the continuation of the Property Manager or the Special Servicer in such       capacity would, in and of itself, result in a downgrade, qualification or withdrawal of any       of the ratings then assigned by such Rating Agency or other nationally recognized       statistical ratings organization to such Notes; or             (x)   the declaration of an Indenture Event of Default; or             (xi)  an Early Amortization Event occurs and is continuing that is reasonably       determined by the Back-Up Manager (unless the Back-Up Manager is then serving as       Property Manager or Special Servicer) or the Requisite Global Majority to be primarily       attributable to acts or omissions of the Property Manager or the Special Servicer rather       than general market factors (provided that the occurrence of an Early Amortization Event       determined to be attributable to the acts or omissions of a Property Manager or Special       Servicer that has been replaced shall not cause a Servicer Replacement Event with       respect to any Successor Property Manager or Successor Special Servicer (including the       Back-Up Manager)); or             (xii) the Property Manager or the Special Servicer has engaged in fraud, gross       negligence or willful misconduct in connection with its performance under this Agreement       and such event could reasonably be expected to have a material adverse effect on the use,       value or operation of the Collateral Pool (taken as a whole), and remains unremedied for       30 days after the Property Manager or the Special Servicer receives written notice       thereof.  When a single entity acts as Property Manager and Special Servicer, a Servicer Replacement Event in one such capacity shall constitute a Servicer Replacement Event in each such capacity. In the event that the same entity is serving as both Property Manager and Special Servicer and such entity is terminated hereunder in one such capacity (in accordance with Section 6.01(b)) , it shall automatically be terminated in both such capacities. Each of the Property Manager and the Special Servicer will notify the Indenture Trustee in writing of the occurrence of a Servicer Replacement Event or an event that, with the giving of notice or the expiration of any cure period, or both, would constitute a Servicer Replacement Event promptly upon obtaining actual knowledge thereof.        (b)  (i)   If any Servicer Replacement Event (other than any Servicer Replacement Event under Sections 6.01(a)(vi) ) occurs with respect to the Property Manager or the Special Servicer (in either case, for purposes of this Section 6.01(b) , the “ Defaulting Party ”) of which a responsible officer of the Indenture Trustee shall have actual knowledge shall occur, then the Indenture Trustee shall provide written notice thereof to the Noteholders requesting that the Noteholders (excluding Spirit Realty and its affiliates) direct the removal of the Property Manager and/or Special Servicer or waive such Servicer Replacement Event. In the event that, while such Servicer Replacement Event is continuing, the Requisite Global Majority directs the                                     85 US-DOCS\ 96557504.7 102826315.7 

 

removal of such Property Manager and/or Special Servicer, as applicable, the Indenture Trustee will terminate such Property Manager or Special Servicer by notice in writing to the Defaulting Party (with a copy of such notice to each other party hereto). For the avoidance of doubt, no such direction may occur in the event that a Servicer Replacement Event is not continuing. Upon the occurrence of any Servicer Replacement Event under Sections 6.01(a)(vi)  with respect to any Defaulting Party, such Defaulting Party shall be immediately terminated without any further action on the part of any other person. Following any such termination of a Defaulting Party as described in this Section 6.01(b) , the Back-Up Manager shall replace the Defaulting Party as Property Manager and/or Special Servicer, as applicable, subject to and in accordance with Section 6.02(b)  and shall have all the rights, duties and obligations of the Property Manager and/or Special Servicer, as applicable, hereunder until a Successor Property Manager or Successor Special Servicer, as applicable, shall have been appointed. Promptly after any such termination, the Indenture Trustee (acting at the written direction of the Requisite Global Majority) shall appoint a successor property manager (any property manager appointed in such manner, the “ Successor Property Manager ”) and/or a successor special servicer (any special servicer appointed in such manner, the “ Successor Special Servicer ”) in accordance with Section 6.01(b)(iii) , each of which shall serve as and have all the rights, duties and obligations of the Property Manager and/or of the Special Servicer, as applicable, hereunder; provided , that any Successor Property Manager or Successor Special Servicer must be an Eligible Successor at the time of such appointment. Upon its appointment, the Successor Property Manager or Successor Special Servicer shall be the successor in all respects to the Property Manager or Special Servicer, as applicable, and shall be subject to all the responsibilities, duties and liabilities relating thereto placed upon the Property Manager or Special Servicer by the terms and provisions hereof; provided , that, no such Successor Special Servicer or Successor Property Manager shall have any liability with respect to any duties or obligations of the terminated Property Manager or Special Servicer, as applicable, accruing prior to the date of such appointment. Notwithstanding the foregoing, if a Servicer Replacement Event under Section 6.01(b)(ii)  or (iii)  occurs as a result of a failure by the Property Manager to make any Advance and the Back-Up Manager makes such Advance, for so long as the Property Manager has not reimbursed the amount of such Advance to the Back-Up Manager, the Back-Up Manager will have the right to immediately terminate the Property Manager (and the Special Servicer, if the Property Manager and the Special Servicer are the same entity) and become the Successor Property Manager (and the Successor Special Servicer, if the Property Manager being replaced and the Special Servicer are the same entity). In any such event, the Back-Up Manager shall be deemed to have been appointed the Successor Property Manager and, if applicable, the Successor Special Servicer hereunder (regardless of whether any of the other conditions of this Section 6.01(b)  are satisfied).             (ii)  Unless otherwise expressly set forth herein, any such appointment of a       Successor Property Manager or Successor Special Servicer, other than the Back-Up       Manager, will be subject to (i) the satisfaction of the Rating Condition and (ii) the written       agreement of the Successor Property Manager or Successor Special Servicer to be bound       by the terms and conditions of this Agreement, together with an Opinion of Counsel       regarding the enforceability of such agreement. Subject to the foregoing conditions set       forth in Section 6.01(b) , any person, including any holder of Notes or LLC Interests or                                      86 US-DOCS\ 96557504.7 102826315.7 

 

      any Affiliate thereof, may be appointed as Successor Property Manager or Successor       Special Servicer.             (iii) In the event that a Successor Property Manager or Successor Special       Servicer (other than the Back-Up Manager), as applicable, has failed to assume all of the       duties and obligations of the Defaulting Party as provided in this Agreement within 30       days of written notice of termination to such Defaulting Party (the “ Successor       Replacement Date ”), the Back-Up Manager shall automatically (and without further       action and regardless of whether any of the other conditions of this Section 6.01(b)  are       satisfied) be (and shall have been deemed to have been appointed) the Successor Property       Manager or the Successor Special Servicer, as applicable, under this Agreement;       provided , however , that the Indenture Trustee shall (at the direction of the Requisite       Global Majority) replace the Back-Up Manager acting as Successor Property Manager or       Successor Special Servicer without cause upon 30 days written notice and appoint a new       Successor Property Manager or Successor Special Servicer specified in such Requisite       Global Majority’s direction; provided , that (i) such appointment shall be subject to the       terms and conditions of the appointment of a Successor Property Manager or Successor       Special Servicer, as applicable, set forth in this Section 6.01(b)(i)  and (if) the Back-Up       Manager shall continue serving as Property Manager or Special Servicer, as applicable,       until such appointment is effected.             (iv)  In the event that a Successor Property Manager or Successor Special       Servicer, as applicable, other than the Back-Up Servicer has not been appointed within       thirty (30) days of the applicable Successor Replacement Date, the Back-Up Manager       may (but shall not be obligated to) direct the Indenture Trustee to appoint (for the       avoidance of doubt, subject to the terms and conditions of the appointment of a       Successor Property Manager or Successor Special Servicer, as applicable, set forth in       Sections 6.01(b)(i)  and (ii))  a Successor Property Manager or Successor Special Servicer       designated by the Back-Up Manager (which successor will be subject to the criteria       described above, including satisfaction of the Rating Condition); provided , that the Back-       Up Manager will continue serving as Property Manager or Special Servicer, as applicable,       until a Successor Property Manager or Successor Special Servicer, as applicable, has       been so appointed. If the Back-Up Manager does not direct the Indenture Trustee to       appoint a Successor Property Manager or Successor Special Servicer within 30 days of       the applicable Successor Replacement Date, then such Back-Up Manager will continue to       serve as Property Manager or Special Servicer, as applicable, and will no longer be       permitted to so direct the Indenture Trustee.             (v)   Each of the Property Manager and the Special Servicer agrees that, if it is       terminated pursuant to this Section 6.01(b) , it shall (i) promptly (and in any event not       later than ten (10) Business Days prior to the effective date of such termination) provide       the Back-Up Manager or any Successor Property Manager or Successor Special Servicer,       as applicable, with all documents and records in accordance with Section 6.02(b) , (ii)       cooperate with such successor in effecting the termination of the duties, obligations,       responsibilities and rights of the Property Manager or Special Servicer hereunder and       transferring such duties, obligations and responsibilities to such successor, (including                                     87 US-DOCS\ 96557504.7 102826315.7 

 

      carrying out the actions set forth in Section 6.02) and (iii) in the event that it receives any       amounts that constitute Collateral, transfer such amounts to the Property Manager (it       being understood that if the Property Manager has been terminated, such amounts shall be       transferred to the Successor Property Manager that succeeds such Property Manager)       within two (2) Business Days after receipt thereof; provided , however , that the Property       Manager and the Special Servicer each shall, if terminated pursuant to this Section       6.01(b) , continue to be obligated for or entitled to pay or receive all amounts accrued or       owing by or to it under this Agreement on or prior to the date of such termination,       whether in respect of Property Protection Advances or otherwise, and it and its directors,       officers, employees and agents shall continue to be entitled to the benefits of Section       5.03(a) notwithstanding any such termination. Any Successor Property Manager or a       Successor Special Servicer shall use reasonable efforts to diligently complete the physical       transfer of servicing from the terminated Property Manager or Special Servicer, as       applicable, with the cooperation of such Property Manager or Special Servicer.        Section 6.02 Successor Property Manager .        (a)  In the event that a Successor Property Manager (including the Back-Up Manager) is appointed, the terminated Property Manager shall arrange for the delivery to the Successor Property Manager of all of the Servicing Files (other than with respect to any Specially Serviced Asset), which Servicing Files shall contain sufficient data to permit the Successor Property Manager to assume the duties of the Property Manager hereunder without delay on account of the absence of relevant servicing information. In the event that a Successor Special Servicer (including the Back-Up Manager) is appointed, the terminated Special Servicer shall arrange for the delivery to the Successor Special Servicer of all of the Servicing Files for any Specially Serviced Asset, which Servicing Files shall contain sufficient data to permit the Successor Special Servicer to assume the duties of the Special Servicer hereunder without delay on account of the absence of relevant servicing information.  If the Back-Up Manager has made any Advances that the Property Manager was required to make but did not make which have not been reimbursed, any Successor Property Manager (other than the Back-Up Manager) will be required to reimburse the Back-Up Manager for such Advances as a condition to its appointment as successor (and any amount so reimbursed will be deemed to constitute Advances made by the Successor Property Manager).        (b)  The Issuers, if they determine in their reasonable discretion that enforcement rights and/or remedies are available to the holders of the Notes against the terminated Property Manager or Special Servicer and it is prudent under the circumstances to enforce such rights, agree to enforce their rights under this Agreement against the terminated Property Manager or Special Servicer, including any rights they have to enforce each Defaulting Party’s obligation to fully cooperate in the orderly transfer and transition of servicing and otherwise comply with the terms of this Agreement. In the event that the Successor Special Servicer or Successor Property Manager discovers or becomes aware of any errors in any records or data of the terminated Special Servicer or Property Manager which impairs its ability to perform its duties hereunder, such Successor Property Manager or Successor Special Servicer shall notify the Issuers and the Indenture Trustee in writing of such errors and shall, at such terminated Special Servicer’s or                                      88 US-DOCS\ 96557504.7 102826315.7 

 

Property Manager’s expense and upon the Issuers’ direction, undertake to correct or reconstruct such records or data.        (c)  From and after the date of this Agreement until the Back-Up Manager becomes the Successor Property Manager, the Property Manager shall (i) provide or cause to be provided to the Back-Up Manager on the 20 th  day of each month, in electronic form, a complete data tape of the Mortgage Loan Schedule, the Mortgaged Property Schedule and such other information as any Issuer may reasonably deem necessary, including all information necessary to determine the Release Price with respect to any Mortgage Loan or Mortgaged Property and the original purchase price paid by any Issuer in respect of any Mortgage Loan or Mortgaged Property and (ii) make available to the Back-Up Manager a copy of each Determination Date Report, Modified Collateral Detail and Realized Loss Report and any Special Servicer Report. The Back- Up Manager will perform an initial comprehensive data integrity review and a monthly review of this information to determine whether it provides adequate information to enable the Back-Up Manager to perform its obligations hereunder as the Back-Up Manager. To the extent that the Back-Up Manager determines within ten (10) calendar days of its receipt of such information that such information is adequate for the Back-Up Manager to perform its obligations as the Back-Up Manager, the Back-Up Manager will provide the Issuers and the Indenture Trustee with written notice to that effect. To the extent that the Back-Up Manager determines within ten (10) calendar days of its receipt of such information that such information is inadequate for the Back-Up Manager to perform its obligations as the Back-Up Manager, the Back-Up Manager will provide prompt written notice to the Issuers and the Property Manager identifying any deficiencies in such information that do not enable the Back-Up Manager to perform its obligations as the Back-Up Manager. The Property Manager shall use its best efforts to provide any such deficient information to the Back-Up Manager within ten (10) calendar days of receipt of such notice from the Back-Up Manager.        (d)  Within ten (10) Business Days of the date of receipt from the Property Manager, the Back-Up Manager shall, in order to understand the purpose of each data field (and the interrelationships among such data fields), review the form of Determination Date Report, Modified Collateral Detail and Realized Loss Report and the Special Servicer Report, each in the form agreed to by the Property Manager and the Back-Up Manager. Provided the data in the Determination Date Report, the Special Servicer Report and the Modified Collateral Detail and Realized Loss Report are in a format readable by the Back-Up Manager, the Back-Up Manager shall create a set of conversion routines and database mapping programs, as necessary, that will enable the Back-Up Manager to (i) receive such data from the Property Manager on a monthly basis and to ensure that the data is readable, and (ii) independently generate such Determination Date Reports and Special Servicer Reports, as applicable, in the event that it is appointed Successor Property Manager or Successor Special Servicer.        (e)  On a monthly basis, the Back-Up Manager shall (x) verify receipt of the Determination Date Report and the Special Servicer Report required to be delivered by the Property Manager, together with any other records and data supplied to the Issuers, Indenture Trustee or otherwise hereunder, by Property Manager with respect to the Mortgage Loans and Leases, and (y) verify that such records and data are in a readable format.                                      89 US-DOCS\ 96557504.7 102826315.7 

 

      (f)  The Back-Up Manager may resign from its obligations under this Agreement (i) with the consent of the Requisite Global Majority, (ii) upon a determination that the performance of its hereunder duties and obligations are no longer permitted under applicable law or (iii) if the Back-Up Manager identifies a successor back-up manager whose appointment as successor Back-Up Manager satisfies the Rating Condition, and in each case a written assumption agreement is executed whereby such successor assumes all rights, duties and obligations of the Back-Up Manager. No such resignation shall become effective a successor shall have assumed the responsibilities and obligations of the Back-Up Manager party hereunder.        Section 6.03 Additional Remedies of the Issuers and the Indenture Trustee upon a Servicer Replacement Event .        During the continuance of any Servicer Replacement Event, so long as such Servicer Replacement Event shall not have been remedied, in addition to the rights specified in Section 6.01 , the Issuers shall have the right, and the Indenture Trustee shall have the right, in its own name and as trustee of an express trust, to take all actions now or hereafter existing at law, in equity or by statute to enforce its rights and remedies and to protect the interests, and enforce the rights and remedies, of the Noteholders (including the institution and prosecution of all judicial, administrative and other proceedings and the filings of proofs of claim and debt in connection therewith). Except as otherwise expressly provided in this Agreement, no remedy provided for by this Agreement shall be exclusive of any other remedy, and each and every remedy shall be cumulative and in addition to any other remedy, and no delay or omission to exercise any right or remedy shall impair any such right or remedy or shall be deemed to be a waiver of any Servicer Replacement Event.        Section 6.04 Replacement of the Servicer.        (a)  Following the occurrence of the Spin-Off, Sprit Realty may elect by written notice to the Issuers and the Indenture Trustee to be replaced as Property Manager and Special Servicer by a direct or indirect wholly owned subsidiary that is a Taxable REIT Subsidiary (any such replacement, a “ Permitted Replacement Event ”); provided  that (i) Spirit Realty has entered into a performance guarantee (a copy of which shall be provided to the Issuers and the Indenture Trustee) whereby Spirit Realty fully, unconditionally and irrevocably guarantees the all obligations, including financial obligations, of such subsidiary pursuant to this Agreement in such subsidiary’s capacity as successor Property Manager and Special Servicer and (ii) immediately after giving effect to such replacement, such subsidiary delegates all of its obligations under this Agreement to Spirit Realty and Spirit Realty accepts such delegation (which may involve an employee sharing agreement between Spirit Realty and the Taxable REIT Subsidiary) (as confirmed by an Officer’s Certificate of Spirit Realty and the applicable Taxable REIT Subsidiary). Any such appointment of a successor Property Manager or successor Special Servicer will be subject to the written agreement of the successor Property Manager or successor Special Servicer to be bound by the terms and conditions of this Agreement, together with an Opinion of Counsel delivered to the Issuers and the Indenture Trustee regarding the enforceability of such agreement.        (b)  If a Qualified Deleveraging Event occurs or if the Corporate Asset Management Agreement is terminated for any reason, Spirit Realty (or any Taxable REIT Subsidiary that has                                     90 US-DOCS\ 96557504.7 102826315.7 

 

been appointed Property Manager and/or Special Servicer) may resign or be replaced as Property Manager and Special Servicer (a “ Permitted Termination Event ”), in each case, upon 30 days prior written notice from Spirit Realty to the Issuers, or from the Issuers to Spirit Realty, as applicable, so long as (i) a Qualified Eligible Successor has been appointed Property Manager and Special Servicer, (ii) the Rating Condition has been satisfied and (iii) the successor Property Manager and/or successor Special Servicer has agreed in writing to be bound by the terms and conditions of this Agreement and the Indenture Trustee has received an Opinion of Counsel regarding the enforceability of such agreement. A “Qualified Eligible Successor ” means any Eligible Successor that, immediately prior to giving effect to its appointment as Property Manager and/or Special Servicer, (i) owns and/or manages at least ten million (10,000,000) square feet of commercial property and (ii) has Net Assets of not less than $50,000,000 and covenants with the Indenture Trustee (on behalf of the Noteholders) to maintain Net Assets in at least such amount at all times. “ Net Assets ” for purposes of such definition means with respect to any entity the difference between (i) the fair value of such entity’s assets, but excluding accumulated depreciation, and (ii) such entity’s liabilities determined in accordance with GAAP. Each of the Property Manager and the Special Servicer agrees that in the event that it receives any amounts that constitute Collateral after giving effect to its resignation, it will transfer such amounts to the successor Property Manager within two business days after receipt thereof.                                  ARTICLE VII    TRANSFERS AND EXCHANGES OF MORTGAGED PROPERTIES AND MORTGAGE   LOANS BY THE APPLICABLE ISSUERS; RELEASE OF MORTGAGED PROPERTIES             AND MORTGAGE LOANS BY THE APPLICABLE ISSUERS.        Section 7.01 Released Mortgage Loans and Released Mortgaged Properties .        (a)  The applicable Issuers may obtain the release (the “ Release ”) of Mortgage Loans or Mortgaged Properties (any such Mortgage Loan or Mortgaged Property, a “ Released Mortgage Loan ” or “ Released Mortgaged Property ” as applicable) from the lien of the Indenture in connection with (i) the exercise of a Third Party Purchase Option, (ii) the purchase or substitution of a Delinquent Asset or Defaulted Asset by the Special Servicer or the Property Manager or any assignee thereof, (iii) the repurchase or substitution of a Mortgage Loan or Mortgaged Property by an applicable Cure Party due to a Collateral Defect, (iv) the sale of a Mortgage Loan or Mortgaged Property to the Support Provider or to a Support Provider SPE , Spirit Realty or to a third party unaffiliated with Spirit Realty or the Support Provider , (v) the exchange of a Mortgage Loan or Mortgaged Property with the Support Provider, a third party unaffiliated with the Support Provider, a Support Provider SPE, Spirit Realty,  Spirit SPE or a third-party unaffiliated with Spirit Realty or the Support Provider or (vi) an Early Refinancing Prepayment. In connection with the Release of (x) any Released Mortgaged Property, the related Lease and the related Lease File shall be simultaneously released from the lien of the Indenture or (y) any Released Mortgage Loan, the related Loan File shall be simultaneously released from the lien of the Indenture. The applicable Issuers shall obtain any Release that it is required to obtain in accordance with the terms hereof.        Except in connection with the release of a Mortgage Loan or a Mortgaged Property in exchange  for  one  or  more  Qualified  Substitute  Mortgage  Loans  or  one  or  more  Qualified                                     91 US-DOCS\ 96557504.7 102826315.7 

 

Substitute  Mortgaged  Properties  or  a  release  in  connection  with  an  Early  Refinancing Prepayment, the applicable Issuer will be required to obtain the applicable Release Price in order to obtain the Release of a Mortgage Loan or Mortgaged Property. The “ Release Price ” for any Mortgage Loan or Mortgaged Property will be an amount equal to (i) the Third Party Option Price if the release occurs in connection with any Third Party Purchase Option, (ii) with respect to any Delinquent Asset or Defaulted Asset purchased by the Special Servicer or the Property Manager or any assignee thereof the greater of (A) the Fair Market Value thereof and (B) the Allocated Loan Amount thereof, (iii) the Payoff Amount with respect to any Mortgage Loan or Mortgaged  Property  repurchased  by  the  related  Originator  or  the  Support  Provider  due  to  a Collateral Defect (or an equivalent amount recorded as a contribution in such calculations), (iv) with respect to any Terminated Lease Property, the Fair Market Value thereof, (v) the greater of (A) the Fair Market Value and (B) the sum of 115% of the Allocated Loan Amount thereof plus unreimbursed  Property  Protection  Advances  (plus  Advance  Interest  thereon),  Emergency Property  Expenses,  Extraordinary  Expenses,  Special Servicing  Fees,  Liquidation  Fees  and Workout Fees for any Mortgage Loan or Mortgaged Property sold to the Support Provider, a Support  Provider  SPE,  Spirit  Realty,  a  Spirit  SPE  or  to  a  third  party  unaffiliated  with  Spirit Realty  or  the  Support  Provider  or  (vi)  the  Fair  Market  Value  of  any  Mortgage  Loan  or Mortgaged  Property,  in  each  case,  in  each  case  if  (X)  the  Property  Manager  or  the  Special Servicer deems the release and sale of such Mortgage Loan or Mortgaged Property pursuant to this  clause  (vi)  to  be  in  the  best  interest  of  the Noteholders  and  (Y)  the  Rating  Agency Notification  Condition  is  satisfied  with  respect  to  such  release  and  sale;  provided,  that  after giving  effect  to  such  sale,  the  aggregate  Collateral  Value  of  all  Mortgaged  Properties   and Mortgage Loans (determined as of the release date with respect to each such Released Mortgage Loan) owned by the Issuer that have been sold to affiliates of any Issuer or Spirit Realty pursuant to this clause (vi) would not exceed, 35.0% of the Aggregate Collateral Value (determined as of the applicable Starting Closing Date) during the Series Closing Period in which such sale occurs; provided, further, that the Issuers shall only be permitted to sell such Mortgaged Properties and Mortgage Loans pursuant to this clause (vi) to its affiliates (or affiliates of Spirit Realty) in the event that the Property Manager or the Special Servicer determines that such sale is reasonably necessary in order to manage the Cashflow Coverage Ratios or compliance with the Maximum Asset  Concentrations.  In  addition,  the  Issuers  shall  not  acquire  any  Mortgaged  Property  or Mortgage  Loan  pursuant  to  this  Section   7.01   in  the  event  that,  after  giving  effect  to  such acquisition,  any  Property Concentration would exceed the Maximum Asset Concentrations set forth  in  the  Indenture  or  any  Series  Supplement  and  in  effect  at  the  time  of  such  acquisition. Notwithstanding anything in the Transaction Documents to the contrary, no Release Price will be payable  with  respect  to  any  Release  Parcel  transferred  to  a  Tenant  pursuant  to  an  obligation under the related Lease in connection with a Specified Permitted Subdivision and, in such case, the Indenture Trustee will release such property from the Collateral Pool, subject only to receipt of an Officer’s Certificate from the Property Manager certifying that: (i) the Specified Permitted Subdivision will not result in a reduction of the Collateral Value of the original property that was subdivided in connection with such Specified Permitted Subdivision, (ii) the Specified Permitted Subdivision  is  in  compliance  in  all  material  respects  with  all  requirements  of  law,  (iii)  the Specified Permitted Subdivision will not impair or otherwise adversely affect the liens, security interests  and  other  rights  of  the  Issuers  in  the  portion  of  the  property  not  being  released  (the “Remaining   Parcel ”),  (iv)  the  Remaining  Parcel  will  comply  with  all requirements  of  law (including,  without  limitation,  all  zoning  (including  any  parking  requirements)  and  building                                     92 US-DOCS\ 96557504.7 102826315.7 

 

codes)  as  well  as  the  applicable  requirements  of  the  Lease,  (v)  the  Remaining  Parcel  will constitute  a  separate  and  legal  lot  for  subdivision,  assessment  and  zoning  purposes,  (vi)  the Remaining Parcel will either constitute a separate and legal lot for tax purposes or an application for  a  separate  tax  lot  identification will have been submitted and an escrow account will have been established with sufficient funds on deposit to pay taxes on both the Release Parcel and the Remaining  Parcel,  (vii)  the  release  of  the  Release Parcel  will  not  materially  adversely  affect ingress or egress to or from the Remaining Parcel or access to utilities for the Remaining Parcel, (viii) the Release Parcel does not include any improvements that are subject to the related Lease, (ix) the documents with respect to the Specified Permitted Subdivision will not impose any new obligations  upon,  or  otherwise  further  burden,  the Remaining  Parcel  in  any  way  other  than customary  reciprocal  easements;  and  (x)  the  Property  Manager  or  the  Tenant has obtained or caused to be obtained all necessary approvals, consents or permits with respect to such Specified Permitted Subdivision (whether from applicable governmental or municipal authorities, parties to instruments  of record affecting the property or otherwise).  The certifications described in the preceding  sentence  are  collectively  referred  to  herein  as  the  “Specified   Permitted   Subdivision Conditions .”   Any  costs  or  expenses  incurred  in  connection  with  any  Specified  Permitted Subdivision will be paid by the Property Manager from its own funds.        In determining the Fair Market Value with respect to any Mortgaged Property or Mortgage Loan, the Property Manager or the Special Servicer, as applicable, shall establish a price determined to be the most probable price which such Mortgage Loan or Mortgaged Property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. In making any such determination, the Property Manager or Special Servicer, as applicable, (X) may obtain an MAI appraisal of the related Mortgaged Property; provided  that in the case of a sale of a Mortgaged Property or Mortgage Loan to an affiliate of any Issuer or Spirit Realty pursuant to clause (vi) of the definition of “Release Price”, the Property Manager or Special Servicer shall obtain such an appraisal unless (x) an appraisal with respect to the related Mortgaged Property or property securing such Mortgage Loan has been delivered within twelve months prior to the sale of such Mortgaged Property or Mortgage Loan and (y) neither the Property Manager nor the Special Servicer reasonably believes that the value of such Mortgaged Property or property securing such Mortgage Loan has materially increased in value since the date of such appraisal and (Y) shall assume the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: (i) buyer and seller are typically motivated; (ii) both parties are well informed or well advised, and acting in what they consider their best interests; (iii) a reasonable time is allowed for exposure in the open market; (iv) payment is made in terms of cash in United States dollars or in terms of financial arrangements comparable thereto; and (v) the price represents the normal consideration for such Mortgage Loan or Mortgaged Property unaffected by special or creative financing or sales concessions granted by anyone associated with the sale. In making any such determination, the Property Manager or Special Servicer shall take into account, among other factors, the period and amount of the delinquency on such Mortgage Loan or Lease, the occupancy level and physical condition of the related Mortgaged Property, the state of the local economy in the area where the Mortgaged Property is located, and the time and expense associated with a purchaser’s foreclosing on the related Mortgaged Property. In addition, the Property Manager or the Special Servicer, as applicable, shall refer to all other relevant information obtained by it or otherwise                                     93 US-DOCS\ 96557504.7 102826315.7 

 

contained in the related servicing file, taking into account any change in circumstances regarding the related Mortgaged Property known to the Property Manager or the Special Servicer, as applicable, that would materially affect the value of the related Mortgaged Property reflected in the most recent related appraisal. Furthermore, the Property Manager or the Special Servicer, as applicable, may consider available objective third party information obtained from generally available sources, as well as information obtained from vendors providing real estate services to the Property Manager or the Special Servicer, as applicable, concerning the market for distressed real estate loans and the real estate market for the subject property type in the area where the related Mortgaged Property is located. The Property Manager or the Special Servicer, as applicable, may also conclusively rely on any opinions or reports of qualified independent experts in real estate or commercial mortgage loan matters. All reasonable costs and expenses incurred by the Property Manager or the Special Servicer, as applicable, pursuant to making a determination of Fair Market Value shall constitute, and be reimbursable as, Property Protection Advances.        (c)  Any (i) Release Price (plus sales proceeds in excess thereof (any such excess amount, a “ Purchase Premium ”)) received by the applicable Issuer in connection with the release of a Mortgage Loan or Mortgaged Property (other than during a Disposition Period) and (ii) any Balloon Payment or Principal Prepayment received in connection with a Mortgage Loan, in each case shall be deposited into the Release Account (or, during the continuance of an Early Amortization Event, the Collection Account or an Exchange Account pursuant to Section 7.01(d) below).        (d)  For the avoidance of doubt, an Issuer may obtain the release of a Mortgage Loan or a Mortgaged Property in exchange for one or more Qualified Substitute Mortgage Loans or one or more Qualified Substitute Mortgaged Properties, as applicable, subject to the terms hereof.        (e)  (i) After giving effect to any sale or exchange of a Mortgage Loan or Mortgaged Property, the aggregate Collateral Value of all Released Mortgaged Properties and Released Mortgage Loans (determined as of the release date with respect to each such Released Mortgage Loan) sold or exchanged by any Issuer during the Closing Date Period in which such sale or exchange occurs shall not exceed 35.0% of the Aggregate Collateral Value (determined as of the applicable Starting Closing Date) unless the Rating Condition is satisfied; provided  that releases and exchanges or substitutions in connection with Collateral Defects, sales pursuant to the exercise of Third Party Purchase Options, sales during the Disposition Period, transfers or exchanges of Terminated Lease Properties, Risk-Based Substitutions and releases in connection with an Early Refinancing Prepayment shall not be subject to the foregoing limitation or taken into consideration in determining such aggregate Collateral Values of such Released Mortgaged Properties and Released Mortgage Loans.             (ii)  If any of the following criteria are satisfied, the release of a Mortgaged       Property in exchange for one or more Qualified Substitute Mortgaged Properties or,       solely in the case of clause (d) below, the release of a Mortgage Loan in exchange for one       or more Qualified Substitute Mortgage Loans or Qualified Substitute Mortgaged       Properties will constitute a “ Risk-Based Substitution ”: (a) the remaining term to       maturity of the related Lease is less than three years from the date of the proposed                                     94 US-DOCS\ 96557504.7 102826315.7 

 

      substitution and the Property Manager, in accordance with the Servicing Standard,       determines that there is a reasonable risk of non-renewal of such Lease ; based on written       communications from the Tenant under such Lease, the Property Manager, in accordance       with the Servicing Standard, determines that there is a reasonable risk of nonrenewal of       such Lease; (c) the Issuer has received from the Tenant under the related Lease written       notice of the non-renewal of such Lease; or (d) the Property Manager, in accordance with       the Servicing Standard, determines that there is a reasonable risk of monetary default by       the Tenant under such Lease or the Borrower under such Mortgage Loan, as applicable,       or such a default has occurred or such Lease or Mortgage Loan is or relates to a       Defaulted Asset.             (iii) If the Class Principal Balance of any Class of Notes is greater than zero on       the Payment Date that is three years prior to the earliest Legal Final Payment Date of any       outstanding Class of Notes, then a disposition period (the “ Disposition Period ”) will       commence on such Payment Date and will continue until the earlier of (i) the date on       which the Class Principal Balance of the Class of Notes having the earliest Legal Final       Payment Date is reduced to zero and (ii) such Legal Final Payment Date. During the       Disposition Period, the Property Manager will be required to utilize efforts consistent       with the Servicing Standard to either (i) sell (on behalf of the Issuers) each Mortgage       Loan and Mortgaged Property for a price equal to the greater of (x) the applicable       Release Price and (y) the applicable Allocated Loan Amount (and in each case in       accordance with the other provisions set forth in this Agreement) or (ii) sell (on behalf of       the Issuers) Mortgage Loans and Mortgaged Properties for no less than an amount       sufficient to generate proceeds which would, when combined with all other amounts       available for such purposes on deposit in the Collection Account and applied as described       in Section 2.11 of the Indenture, cause the Class Principal Balance of each Class of Notes       to be reduced to zero and all outstanding expenses of the Issuers to be paid. In the event       of any such disposition, the sales proceeds therefor will be deposited as Unscheduled       Proceeds into the Collection Account and applied as part of the Available Amount on the       Payment Date relating to the Collection Period in which such deposit occurs.        (f)  If the Rating Condition is satisfied, the Property Manager and the Issuers may enter into an Exchange Agreement with a Qualified Intermediary to establish a Like-Kind Exchange Program.  If a Like-Kind Exchange Program is established, the Property Manager and the Issuers (or the Property Manager on behalf of the Issuers) shall be permitted to:             (i)   Assign their respective rights to each Relinquished Property Agreement       and Replacement Property Agreement to the Qualified Intermediary in accordance with       Section 1.1031(k)-1(g)(4)(iv) of the Treasury Regulations (or any successor section       thereto); and             (ii)  Deposit all Relinquished any Net Release Price constituting a portion       ofRelinquished  Property Proceeds with respect to any Mortgage Loan or Mortgaged       Property  in the Exchange Account (in lieu of depositing such amount in the Release       Account), which such amounts may be disbursed from such Exchange Account to the       applicable seller of any Replacement Property;                                     95 US-DOCS\ 96557504.7 102826315.7 

 

Provided , that, no such assignment pursuant to clause (d)(i) above or deposit in the Exchange Account pursuant to clause (ii) above shall be permitted unless, (A) the Issuers have established the Exchange Reserve Account and (B) the Exchange Cash Collateral relating to the applicable Relinquished Property has been deposited in the Exchange Reserve Account.        If an Early Amortization Event has occurred and is continuing, all Exchange Cash Collateral on deposit in the Exchange Reserve Account shall be transferred to the Collection Account as Unscheduled Proceeds and applied as Unscheduled Principal Payments on the Payment Date following the commencement of such Early Amortization Event.  Upon such transfer of Exchange Cash Collateral, the Indenture Trustee will release any interest in any right to receive any related amounts of Relinquished Property Proceeds on deposit in the Exchange Account. Upon the purchase of any Qualified Substitute Mortgaged Property using any Relinquished Property Proceeds, if directed by the Property Manager, the Indenture Trustee will release Exchange Cash Collateral in an amount equal to the amount of such Relinquished Property Proceeds that were used for such purchase directly to the Issuers without depositing such amount in the Collection Account. In addition, if any Relinquished Property Proceeds on deposit in the Exchange Account are transferred to the Release Account as a result of a failed exchanged or otherwise, if directed by the Property Manager, the Indenture Trustee to release Exchange Cash Collateral in an amount equal to the amount of such Relinquished Property Proceeds transferred to the Release Account directly to the Issuers without depositing such amount in the Collection Account.        Exchange Cash Collateral will be invested in Permitted Investments as directed by the Issuers, or if no such direction is received, will be held uninvested. Any such Permitted Investment must (i) have a maturity date prior to the Payment Date following the date of such direction and (ii) have a short-term rating of not less than “A- 2” by S&P. Any interest or other income earned on funds in the Exchange Reserve Account (including interest on any Permitted Investments) will be treated as Unscheduled Proceeds part of the Available Amount  for the applicable Payment Date.        Section 7.02 Third Party Purchase Options; Release of Mortgaged Properties to Affiliates under Defaulted or Delinquent Assets; Early Refinancing Prepayment; Other Sales or Exchanges .        (a)  In the event any third party authorized to do so exercises a Third Party Purchase Option in accordance with the terms of the applicable Lease, the Third Party Option Price (without giving effect to clause (ii) in the definition thereof) paid by such third party shall be deposited into the Release Account (or, during the continuance of an Early Amortization Amount, the Collection Account), at the direction of the Property Manager, and upon receipt of an Officer’s Certificate from the Property Manager to the effect that such deposit has been or will be made (which the Property Manager shall deliver to the Indenture Trustee and the Issuers promptly after such deposit is made or immediately prior to the time at which such deposit will be made), the Indenture Trustee shall execute and deliver such instruments of transfer or assignment, in each case without recourse, as shall be provided to it by the Property Manager and are reasonably necessary to release the related Mortgage or any other lien on or security interest in such Mortgaged Property (each, a “ Third Party Option Mortgaged Property ”), whereupon such Mortgaged Property may be sold, transferred or otherwise disposed of by such Issuer, free                                     96 US-DOCS\ 96557504.7 102826315.7 

 

and clear of the lien of the Indenture and any Mortgage. Each of the applicable Issuers and the Property Manager hereby covenant and agree that they shall not solicit any Person to exercise any Third Party Purchase Option.        (b)  A Mortgaged Property leased under or constituting any Delinquent Asset or any Defaulted Asset, or a Mortgage Property securing or constituting any Delinquent Asset or any Defaulted Asset, may at the option of the Property Manager or Special Servicer be (a) purchased by the Special Servicer or the Property Manager or any assignee thereof for cash in an amount equal to the applicable Release Price, or (b) substituted for one or more Qualified Substitute Mortgaged Properties or Qualified Substitute Mortgage Loans owned by the Special Servicer, the Property Manager or any assignee thereof; provided , that (1) no Early Amortization Event has occurred and is continuing or would occur as a result of such purchase or substitution or (2) the Rating Condition is satisfied with respect to such purchase or substitution. The Indenture Trustee shall execute and deliver such instruments of release, transfer or assignment, in each case without recourse, as shall be provided to it by the applicable Issuer and are reasonably necessary to release any lien or security interest in the Released Mortgage Loan or Released Mortgage Property relating to such purchase or substitution, whereupon such Mortgaged Property may be sold, transferred or otherwise disposed of by such Issuer, free and clear of the lien of the Indenture and any Mortgage.        (c)  The applicable Issuer may (i) sell any of its Mortgage Loans or Mortgaged Properties and related Leases for cash equal to any amount not less than the applicable Release Price and/or (ii) exchange such Mortgage Loan or Mortgaged Property for one or more Qualified Substitute Mortgage Loans or Qualified Substitute Mortgaged Properties, as applicable, in each case in a transaction with (1) a third party unaffiliated with Spirit Realty, (2) a Spirit SPE or (3) a Support Provider SPE; provided , however , that no Early Amortization Event has occurred and is continuing or would occur as a result of such sale or exchange (unless the Rating Condition is satisfied with respect to such sale or exchange). The Indenture Trustee shall execute and deliver such instruments of release, transfer or assignment, in each case without recourse, as shall be provided to it by the applicable Issuer and are reasonably necessary to release any lien or security interest in the Released Mortgage Loan or Released Mortgage Property relating to such sale or exchange, whereupon such Mortgaged Property may be sold, transferred or otherwise disposed of by such Issuer, free and clear of the lien of the Indenture and any Mortgage.        (d)  In the event that the applicable Tenant or any other Person pays any cash price in connection with the exercise of a Third Party Purchase Option, the Issuers (or the Property Manager or Special Servicer, as applicable, on behalf of the Issuers) may use a portion of such cash price (not to exceed the Third Party Option Expenses with respect to such exercise) to pay the applicable costs and expenses incurred by the Issuers (or such Property Manager or Special Servicer on behalf of such Issuers) in connection with such exercise (and such portion shall not constitute part of the Available Amount for any Payment Date).        Section 7.03 Transfer of Lease to New Mortgaged Property.        In the event a Tenant under a Lease requests that such Lease be modified to apply to a property (owned by such Tenant or an Affiliate thereof) in lieu of the related Mortgaged                                     97 US-DOCS\ 96557504.7 102826315.7 

 

Property, the substitute property shall be acquired by the applicable Issuer (with the consent of the Issuer and the Property Manager or Special Servicer, as applicable) from such Tenant or Affiliate thereof in exchange for the original Mortgaged Property (each such original Mortgaged Property, a “Lease Transfer Mortgaged Property”) and such substitute property will be mortgaged to the Indenture Trustee; provided, however, that none of the applicable Issuer, the Property Manager or the Special Servicer shall consent to the substitution of a Lease Transfer Mortgaged Property unless (i) the substituted property is a Qualified Substitute Mortgaged Property and satisfies any criteria set forth in such Lease and (ii) the Property Manager and Back-Up Manager have been reimbursed for all Property Protection Advances and Emergency Property Expenses related to the Lease Transfer Mortgaged Property. Upon the Indenture Trustee’s receipt of an Officer’s Certificate from the Property Manager to the effect that such modification and substitution has been or will be completed in accordance with the terms hereof (which shall include a certification that the applicable Issuer has executed and delivered (or immediately will execute and deliver) a Mortgage with respect to the applicable Lease Transfer Mortgaged Property to the Indenture Trustee), the Indenture Trustee shall execute and deliver such instruments of release, transfer or assignment, in each case without recourse, as shall be provided to it by such Issuer and are reasonably necessary to release any lien or security interest in the Lease Transfer Mortgaged Property, whereupon such Lease Transfer Mortgaged Property may be sold, transferred or otherwise disposed of by such Issuer, free and clear of the lien of the Indenture and any Mortgage. Any proceeds of such sale, transfer or other disposition shall not constitute part of the Collateral and shall not be deposited in the Collection Account or the Release Account.        In connection with an Early Refinancing Prepayment, if directed by an Issuer (or the Property Manager on behalf of an Issuer) the Indenture Trustee will release Mortgaged Properties and Mortgage Loans with an aggregate Allocated Loan Amount not to exceed the Qualified Release Amount; provided, however, that the Rating Condition is satisfied in connection with such release and such release does not cause (i) an Event of Default or Early Amortization Event to occur or (ii) a Maximum Asset Concentration to be exceeded after giving effect to such release (or if, prior to such release, an existing Maximum Asset Concentration is already exceeded, the release of such Mortgaged Properties or Mortgage Loans will reduce the Maximum Asset Concentration or such Maximum Asset Concentration will remain unchanged after giving effect to such release).        Section 7.04 Criteria Applicable to all Mortgage Properties and Mortgage Loans included in the Collateral Pool .        (a)  No Issuer shall acquire, either in connection with a New Issuance or as a Qualified Substitute Mortgage Loan or Qualified Substitute Mortgaged Property, any real property or mortgage loan that will not meet the definition of “Mortgaged Property” or “Mortgage Loan”, as applicable, set forth herein or that is operated in a business sector other than a “Business Sector” as defined in the most recent Series Supplement which includes a definition of “Business Sector.”        (b)  For each Mortgaged Property included in the Collateral Pool, on or prior to the later of (i) the First Collateral Date with respect to such Mortgaged Property and (ii) the Applicable Series Closing Date, the Property Manager shall assign such Mortgaged Property to a particular Business Sector (and such Mortgaged Property shall be categorized as solely being in                                     98 US-DOCS\ 96557504.7 102826315.7 

 

such Business Sector). From and after such assignment with respect to such Mortgaged Property, the Property Manager shall not assign such Mortgaged Property to a different Business Sector.        (c)  For each Mortgaged Property securing a Mortgage Loan included in the Collateral Pool, on or prior to the later of (i) the First Collateral Date with respect to such Mortgage Loan and (ii) the Applicable Series Closing Date, the Property Manager shall assign such Mortgaged Property to a particular Business Sector (and such Mortgaged Property shall be categorized as solely being in such Business Sector). From and after such assignment with respect to such Mortgaged Property, the Property Manager shall not assign such Mortgaged Property to a different Business Sector.        (d)  If the definition of “Business Sector” in the Indenture is amended pursuant to an amendment, the Property Manager may reasonably re-designate any Mortgaged Property included in the Collateral Pool in order to give effect to such amendment.        (e)  The Loan Documents for any adjustable rate Mortgage Loan added to the Collateral Pool after the Series 2017-1 Closing Date that accrues interest based on LIBOR will contain provisions that provide for interest to accrue in an alternate manner in the event LIBOR becomes unavailable.        (f)  The Loan Documents for any Mortgage Loan added to the Collateral Pool after the Series 2017-1 Closing Date will contain provisions that require Monthly Loan Payments of interest and scheduled principal to be payable by the related Borrower on the first day of each calendar month.        Section 7.05 Restrictions on Environmental Condition Mortgaged Properties .        An Environmental Condition Mortgaged Property shall not be considered a Qualified Substitute Mortgaged Property; provided  that a Protective Mortgage Loan may be secured by an Environmental Condition Mortgaged Property (and, for the avoidance of doubt, any Environmental Condition Mortgaged Property may be considered a Qualified Substitute Mortgaged Property for purposes of determining whether a Protective Mortgage Loan constitutes a Qualified Substitute Protective Mortgage Loan).        Section 7.06 Terminated Lease Property.        An Issuer may remove a Terminated Lease Property from the Collateral Pool in exchange for the addition of one or more Qualified Substitute Mortgaged Properties to the Collateral Pool pursuant to the provisions of Section 7.01.                                  ARTICLE VIII                                TERMINATION        Section 8.01 Termination Upon Repurchase or Liquidation of All Mortgaged Properties or Discharge of Indenture .                                     99 US-DOCS\ 96557504.7 102826315.7 

 

      The respective obligations and responsibilities under this Agreement of the Property Manager, the Special Servicer, the Back-Up Manager and the Issuers shall terminate upon the earlier of (i) liquidation or final payment under the last remaining Mortgage Loan or Lease with respect to a Mortgaged Property included in the Collateral Pool and (ii) satisfaction of the indebtedness evidenced by the Notes.                                  ARTICLE IX                         MISCELLANEOUS PROVISIONS        Section 9.01 Amendment.        Subject to the provisions of Article VIII of the Indenture governing amendments, supplements and other modifications to this Agreement, this Agreement may be amended, supplemented or modified by the parties hereto from time to time but only by the mutual written agreement signed by the parties hereto with 20 days’ prior written notice to the Rating Agencies. The Property Manager shall furnish to each party hereto and to the Issuers a fully executed counterpart of each amendment to this Agreement.        The parties hereto agree that no modifications or amendments will be made to the Indenture, any Series Supplement or other Transaction Documents without the consent of the Property Manager, the Special Servicer or the Back-Up Manager, as applicable, if such person would be materially adversely affected by such modification or amendment, regardless of whether such person is a party to such agreement.        Section 9.02 Counterparts.        This Agreement may be executed simultaneously in any number of counterparts, each of which shall be deemed to be an original, and all such counterparts shall constitute but one and the same instrument. This Agreement may be executed in several counterparts, each of which counterparts shall be deemed an original instrument and all of which together shall constitute a single Agreement. Delivery of an executed counterpart of a signature page of this Agreement in Portable Document Format (PDF) or by facsimile transmission shall be as effective as delivery of a manually executed original counterpart of this Agreement.        Section 9.03 GOVERNING LAW .        THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE INTERNAL  LAWS  OF  THE  STATE  OF  NEW  YORK  APPLICABLE  TO AGREEMENTS  MADE  AND  TO  BE  PERFORMED  IN  SUCH  STATE  (WITHOUT REGARD  TO  CONFLICT  OF  LAWS  PRINCIPLES),  AND  THE  OBLIGATIONS, RIGHTS  AND  REMEDIES  OF  THE  PARTIES  HEREUNDER  SHALL           BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.        Section 9.04 Notices .                                     100 US-DOCS\ 96557504.7 102826315.7 

 

      All notices, requests and other communications hereunder shall be in writing and, unless otherwise provided herein, shall be deemed to have been duly given if delivered by courier or mailed by first class mail, postage prepaid, or if transmitted by facsimile or e-mail and confirmed in a writing delivered or mailed as aforesaid, to:        (a)  the Property Manager or Special Servicer, Spirit Realty, L.P., 16767 N. Perimeter Drive, Suite 210, Scottsdale, Arizona 85260; fax: 480-606-0826; e-mail: rberry@spiritrealty.com;        (b)  in the case of the Back-Up Manager, Midland Loan Services, a division of PNC Bank, National Association, 10851 Mastin Street, Suite 700, Overland Park, Kansas, 66210, Attention: President, facsimile number: 913-253-9009, e-mail: noticeadmin@midlandls.com and noticeadmin@pnc.com, with a copy to,  Andrascik & Tita LLC, 1425 Locust Street, Suite 268, Philadelphia, PA 19102, Attention: Stephanie Tita, e-mail: stephanie@kanlegal.com;        (c)  in the case of the Issuers: to Spirit Master Funding, LLC, Spirit Master Funding II, LLC, Spirit Master Funding III, LLC or the name of any other Issuer, as applicable, at 16767 N. Perimeter Drive, Suite 210, Scottsdale, Arizona 85260, facsimile number: 480- 606-0820; Attention: Ryan Berry, General Counsel; e-mail: rberry@spiritrealty.com;        (d)  in the case of the Indenture Trustee, Citibank, N.A., 388 Greenwich Street, 14 th Floor, New York, New York 10013, Attention: Structured Finance Agency and Trust- Spirit Master Funding, LLC, facsimile number: 212-816-5527;        (e)  in the case of any Originator, at its address for notices specified in the related Property Transfer Agreement; provided , however , that any notice required to be given hereunder to any Originator which has ceased to exist as a legal entity for any reason may be given directly to the Support Provider;        (f)  in the case of the Support Provider, at its address for notices specified in the Performance Undertakings;        (g)  in the case of any Rating Agency, as provided in each outstanding Series Supplement;  or, as to each such Person, to such other address and facsimile number as shall be designated by such Person in a written notice to parties hereto. Any notice required or permitted to be delivered to a holder of LLC Interests or Notes shall be deemed to have been duly given if mailed by first class mail, postage prepaid, at the address of such holder as shown in the register maintained for such purposes under the applicable LLC Agreement and the Indenture, respectively. Any notice so mailed within the time prescribed in this Agreement shall conclusively be presumed to have been duly given, whether or not such holder receives such notice.        Section 9.05 Severability of Provisions .        If any one or more of the covenants, agreements, provisions or terms of this Agreement shall be for any reason whatsoever held invalid, then such covenants, agreements, provisions or                                    101 US-DOCS\ 96557504.7 102826315.7 

 

terms shall be deemed severable from the remaining covenants, agreements, provisions or terms of this Agreement and shall in no way affect the validity or enforceability of the other provisions of this Agreement.        Section 9.06 Effect of Headings and Table of Contents .        The article and section headings and the table of contents herein are for convenience of reference only and shall not limit or otherwise affect the construction hereof.        Section 9.07 Notices to Rating Agencies .        (a)  The Indenture Trustee shall promptly provide notice to the Rating Agencies with respect to each of the following of which a Responsible Officer of the Indenture Trustee has actual knowledge:             (i)   Any requests for the satisfaction of the Rating Condition;             (ii)  The occurrence of any Servicer Replacement Event that hasnot been       cured; and             (iii) the resignation or termination of the Property Manager or the Special       Servicer and the appointment of a successor.        (b)  The Property Manager shall promptly provide notice to the Rating Agencies with respect to each of the following of which it has actual knowledge:             (i)   the resignation or removal of the Indenture Trustee and the appointment of       a successor;             (ii)  any change in the location of the Collection Account or the Release       Account;             (iii) any change in the identity of an Obligor; and             (iv)  any requests for the satisfaction of the Rating Condition;             (v)   any addition or removal of a Mortgage Loan or Mortgaged Property from       the Collateral.        (c)  Each of the Property Manager and the Special Servicer, as the case may be, shall furnish each Rating Agency such information with respect to the Mortgage Loans, Leases and Mortgaged Properties as such Rating Agency shall reasonably request and that the Property Manager or the Special Servicer, as the case may be, can reasonably provide.        (d)  Prior to providing any information to, or communicating with, any Rating Agency in accordance with its obligations hereunder or under the Indenture, the Property Manager, Special Servicer or Indenture Trustee, as applicable, shall cause such information or                                     102 US-DOCS\ 96557504.7 102826315.7 

 

communication to be uploaded to the 17g-5 Website subject to and in accordance with the terms of the Indenture relating thereto (including with respect to such uploading).        (e)  Any Officer’s Certificate, Opinion of Counsel, report, notice, request or other material communication prepared by the Property Manager, the Special Servicer, the Issuer Members on behalf of each Issuer or the Indenture Trustee, or caused to be so prepared, for dissemination to any of the parties to this Agreement or any holder of Notes or LLC Interests shall also be concurrently forwarded by such Person to Spirit Realty and the Issuers to the extent not otherwise required to be so forwarded.        Section 9.08 Successors and Assigns: Beneficiaries .        The provisions of this Agreement shall be binding upon and inure to the benefit of the respective successors and assigns of the parties hereto. The Indenture Trustee shall be an express third party beneficiary hereof. No other person, including any Obligor, shall be entitled to any benefit or equitable right, remedy or claim under this Agreement. Except as otherwise expressly permitted herein, the Back-Up Manager may not assign any of its rights, duties or obligations under this Agreement, in whole or in part, without the prior written consent of each other party hereto.        Section 9.09 Complete Agreement .        This Agreement embodies the complete agreement among the parties with respect to the subject matter hereof and may not be varied or (other than pursuant to Section 8.01) terminated except by a written agreement conforming to the provisions of Section 9.01 . All prior negotiations or representations of the parties are merged into this Agreement and shall have no force or effect unless expressly stated herein.        Section 9.10 [Reserved].        Section 9.11 Consent to Jurisdiction .        Any action or proceeding against any of the parties hereto relating in any way to this Agreement may be brought and enforced in the courts of the State of New York sitting in the borough of Manhattan or of the United States District Court for the Southern District of New York and each of the parties hereto irrevocably submits to the jurisdiction of each such court in respect of any such action or proceeding. Each of the parties hereto hereby waives, to the fullest extent permitted by law, any right to remove any such action or proceeding by reason of improper venue or inconvenient forum.        Section 9.12 No Proceedings .        The Property Manager, the Special Servicer, each Issuer (with respect to any other Issuer) and the Back-Up Manager hereby covenant and agree that, prior to the date which is two years and thirty-one days after the payment in full of the latest maturing Note, it will not institute against, or join with, encourage or cooperate with any other Person in instituting, against an Issuer any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or                                    103 US-DOCS\ 96557504.7 102826315.7 

 

other proceedings, under any federal or state bankruptcy or similar law; provided , however , that nothing in this Section 9.12  shall constitute a waiver of any right to indemnification, reimbursement or other payment from the Issuer pursuant to the Indenture. In the event that any such Person takes action in violation of this Section 9.12 , the applicable Issuer, shall file or cause to be filed an answer with the bankruptcy court or otherwise properly contesting the filing of such a petition by any such Person against such Issuer or the commencement of such action and raising the defense that such Person has agreed in writing not to take such action and should be estopped and precluded therefrom and such other defenses, if any, as its counsel advises that it may assert. The provisions of this Section 9.12  shall survive the termination of this Agreement, and the resignation or removal of any party hereto. Nothing contained herein shall preclude participation by any Person in the assertion or defense of its claims in any such proceeding involving an Issuer.        The obligations of each Issuer under Agreement are solely the obligations of such Issuer. No recourse shall be had for the payment of any amount owing in respect of any fee hereunder or any other obligation or claim arising out of or based upon this Agreement against any member, employee, officer or director of such Issuer. Fees, expenses, costs or other obligations payable by an Issuer hereunder shall be payable by such Issuer solely to the extent that funds are then available or thereafter become available for such purpose pursuant to Section 2.11 of the Indenture. In the event that sufficient funds are not available for their payment pursuant to Section 2.11 of the Indenture, the excess unpaid amount of such fees, expenses, costs or other obligations shall in no event constitute a claim (as defined in Section 101 of the Bankruptcy Code) against, or corporate obligation of, such Issuer.                                     104 US-DOCS\ 96557504.7 102826315.7 

 

      IN WITNESS WHEREOF, each party hereto has caused this Agreement to be duly executed by their respective officers or representatives all as of the day and year first above written.                                   SPIRIT MASTER FUNDING, LLC  , as Issuer                                   By:  Spirit SPE Manager, LLC, a Delaware limited                                      liability company                                  Its:  Manager                                    By:                                        Name: Peter M. Mavoides                                      Its: President and Chief Operating Officer                                   SPIRIT MASTER FUNDING II, LLC , as Issuer                                   By:  Spirit SPE Manager, LLC, a Delaware limited                                      liability company                                  Its:  Manager                                    By:                                        Name: Peter M. Mavoides                                      Its: President and Chief Operating Officer                                   SPIRIT MASTER FUNDING III, LLC , as Issuer                                   By:  Spirit SPE Manager, LLC, a Delaware limited                                      liability company                                  Its:  Manager                                    By:                                        Name: Peter M. Mavoides                                      Its: President and Chief Operating Officer                                 Signature Page to                      Property Management and Servicing Agreement US-DOCS\ 96557504.7 102826315.7 

 

                                 SPIRIT REALTY, L.P. ,                                   By:  Spirit General OP Holdings, LLC, a Delaware                                      limited liability company                                  Its:  Manager                                    By:                                        Name: Peter M. Mavoides                                      Its: President and Chief Operating Officer                                   MIDLAND LOAN SERVICES, A DIVISION                                  OF PNC BANK, NATIONAL ASSOCIATION   ,                                  as Back-Up Manager                                    By:                                        Name: Lawrence D. Ashley                                      Title: Senior Vice President                                 Signature Page to                      Property Management and Servicing Agreement  US-DOCS\ 96557504.7 102826315.7 

 

                       Summary report:    Litéra® Change-Pro TDC 10.1.0.400 Document comparison done on                      11/1/2018 1:02:06 PM Style name: L&W without Moves Intelligent Table Comparison: Active Original DMS: iw://US-DOCS/US-DOCS/102826315/1 Modified DMS: iw://US-DOCS/US-DOCS/102826315/7 Changes: Add                                            32 Delete                                         18 Move From                                      0 Move To                                        0 Table Insert                                   0 Table Delete                                   0 Table moves to                                 0 Table moves from                               0 Embedded Graphics (Visio, ChemDraw, Images etc.) 0 Embedded Excel                                 0 Format changes                                 0 Total Changes:                                 50spirit2018notepurchaseag

  EXECUTION VERSION                               CLASS A NOTE PURCHASE AGREEMENT                     (NET-LEASE MORTGAGE VARIABLE FUNDING NOTES,                                   SERIES 2018-1, CLASS A)                                 dated as of November 1, 2018                                          among                                                                           SPIRIT MASTER FUNDING, LLC,                             SPIRIT MASTER FUNDING II, LLC,                             SPIRIT MASTER FUNDING III, LLC,                           SPIRIT MASTER FUNDING VI, LLC, and                            SPIRIT MASTER FUNDING VIII, LLC,                                      each as a Co-Issuer,                                                                            CERTAIN CONDUIT INVESTORS,                                   each as a Conduit Investor,                                                                         CERTAIN FINANCIAL INSTITUTIONS,                              each as a Committed Note Purchaser,                                                                           CERTAIN FUNDING AGENTS, and                                                                               BARCLAYS BANK PLC,                                  as the Administrative Agent                                                                     solely for purposes of Sections 6.03 and 8.02 hereof,                                                                                SPIRIT REALTY, L.P.,                                   as the Property Manager,                                                                   and, solely for purposes of Sections 6.02 and 8.03 hereof,                                                                                   Spirit MTA REIT,                                        as the Parent                                                     DMSLIBRARY01\32647597  

 

                                     TABLE OF CONTENTS   ARTICLE I DEFINITIONS ......................................................................................................................... 2         SECTION 1.01        Definitions ................................................................................................ 2   ARTICLE II PURCHASE AND SALE OF SERIES 2018-1 CLASS A NOTES ...................................... 12         SECTION 2.01        Series 2018-1 Class A Notes .................................................................. 12         SECTION 2.02        Advances ................................................................................................. 12         SECTION 2.03        Borrowing Procedures ............................................................................ 14         SECTION 2.04       The Series 2018-1 Class A Notes ........................................................... 16         SECTION 2.05        Reduction in Commitments .................................................................... 16   ARTICLE III INTEREST AND FEES ....................................................................................................... 18         SECTION 3.01       Interest .................................................................................................... 18         SECTION 3.02        Fees ......................................................................................................... 19         SECTION 3.03        Eurodollar Lending Unlawful ................................................................. 20         SECTION 3.04        Deposits Unavailable; Alternate Rate of Interest .................................... 20         SECTION 3.05        Increased Costs, etc ................................................................................ 21         SECTION 3.06        Funding Losses ....................................................................................... 22         SECTION 3.07        Increased Capital or Liquidity Costs ...................................................... 22         SECTION 3.08        Taxes ....................................................................................................... 23         SECTION 3.09        Change of Lending Office ...................................................................... 26   ARTICLE IV OTHER PAYMENT TERMS .............................................................................................. 27         SECTION 4.01        Time and Method of Payment (Amounts Distributed by the                             Administrative Agent .............................................................................. 27         SECTION 4.02        Order of Distributions (Amounts Distributed by the Indenture                             Trustee) ................................................................................................... 27   ARTICLE V THE ADMINISTRATIVE AGENT AND THE FUNDING AGENTS ............................... 28         SECTION 5.01        Authorization and Action of the Administrative Agent .......................... 28         SECTION 5.02       Delegation of Duties ............................................................................... 28         SECTION 5.03        Exculpatory Provisions ........................................................................... 28         SECTION 5.04        Reliance .................................................................................................. 29         SECTION 5.05        Non-Reliance on the Administrative Agent and Other Purchasers ......... 29         SECTION 5.06        The Administrative Agent in its Individual Capacity ............................. 29         SECTION 5.07       Successor Administrative Agent; Defaulting Administrative                             Agent....................................................................................................... 29         SECTION 5.08        Authorization and Action of Funding Agents ......................................... 31         SECTION 5.09       Delegation of Duties ............................................................................... 31         SECTION 5.10        Exculpatory Provisions ........................................................................... 31         SECTION 5.11        Reliance .................................................................................................. 31         SECTION 5.12        Non-Reliance on the Funding Agent and Other Purchasers ................... 32         SECTION 5.13        The Funding Agent in its Individual Capacity ........................................ 32         SECTION 5.14       Successor Funding Agent ....................................................................... 32   ARTICLE VI REPRESENTATIONS AND WARRANTIES .................................................................... 32         SECTION 6.01        The Co-Issuers ........................................................................................ 32         SECTION 6.02        The Parent ............................................................................................... 34         SECTION 6.03        The Property Manager ............................................................................ 35         SECTION 6.04        Investors .................................................................................................. 35                                               i  DMSLIBRARY01\32647597  

 

     ARTICLE VII CONDITIONS .................................................................................................................... 36        SECTION 7.01        Conditions to Issuance and Effectiveness ............................................... 36        SECTION 7.02         Conditions to Initial Extensions of Credit .............................................. 36        SECTION 7.03        Conditions to Each Extension of Credit ................................................. 37   ARTICLE VIII COVENANTS ................................................................................................................... 38        SECTION 8.01         Covenants of the Co-Issuers ................................................................... 38        SECTION 8.02         Covenants of the Property Manager ....................................................... 40        SECTION 8.03        Covenants of the Parent .......................................................................... 40   ARTICLE IX MISCELLANEOUS PROVISIONS .................................................................................... 43        SECTION 9.01         Amendments ........................................................................................... 43        SECTION 9.02         No Waiver; Remedies ............................................................................. 44        SECTION 9.03         Binding on Successors and Assigns ........................................................ 44        SECTION 9.04         Survival of Agreement ............................................................................ 46        SECTION 9.05         Payment of Costs and Expenses; Indemnification .................................. 46        SECTION 9.06        Characterization as Transaction Document; Entire Agreement .............. 48        SECTION 9.07        Notices .................................................................................................... 48        SECTION 9.08         Severability of Provisions ....................................................................... 48        SECTION 9.09         Tax Characterization ............................................................................... 48        SECTION 9.10         No Proceedings; Limited Recourse ........................................................ 49        SECTION 9.11         Confidentiality ........................................................................................ 50        SECTION 9.12        GOVERNING LAW; CONFLICTS WITH INDENTURE OR                            THE SERIES 2018-1 SUPPLEMENT ................................................... 51        SECTION 9.13         JURISDICTION ..................................................................................... 51        SECTION 9.14        WAIVER OF JURY TRIAL ................................................................... 51        SECTION 9.15         Counterparts ............................................................................................ 51        SECTION 9.16         Third Party Beneficiary .......................................................................... 51        SECTION 9.17         Assignment ............................................................................................. 51        SECTION 9.18         Defaulting Investors ................................................................................ 53        SECTION 9.19         No Fiduciary Duties ................................................................................ 55        SECTION 9.20        No Guarantee by the Parent or the Property Manager ............................ 55        SECTION 9.21         Term; Termination of Agreement ........................................................... 55        SECTION 9.22         Acknowledgement and Consent to Bail-In of EEA Financial                            Institutions .............................................................................................. 55        SECTION 9.23         Joint and Several Obligations of the Co-Issuers; Designation of                            Property Manager as Representative and Agent ..................................... 56        SECTION 9.24         Patriot Act ............................................................................................... 57                                                    ii  DMSLIBRARY01\32647597  

 

     SCHEDULES AND EXHIBITS   SCHEDULE I        Investor Groups and Commitments  SCHEDULE II       Notice Addresses for Investors and Agents  SCHEDULE III      Additional Closing Conditions  SCHEDULE IV       U.S. Risk Retention Disclosure  SCHEDULE V        E.U. Risk Retention Disclosure   EXHIBIT A         Form of Advance Request  EXHIBIT B         Form of Assignment and Assumption Agreement  EXHIBIT C         Form of Investor Group Supplement  EXHIBIT D         Form of Purchaser’s Letter                                              iii  DMSLIBRARY01\32647597  

 

                           CLASS A NOTE PURCHASE AGREEMENT                THIS CLASS A NOTE PURCHASE AGREEMENT, dated as of November 1, 2018 (as  amended, amended and restated, supplemented or otherwise modified from time to time in accordance  with the terms hereof, this “Agreement”), is made by and among:                (a)    SPIRIT MASTER FUNDING, LLC, SPIRIT MASTER FUNDING II, LLC,  SPIRIT MASTER FUNDING III, LLC, SPIRIT MASTER FUNDING VI, LLC and SPIRIT MASTER  FUNDING VIII, LLC, each a Delaware limited liability company, as the Co-Issuers (the “Co-Issuers”);                (b)    SPIRIT MTA REIT, a Maryland real estate investment trust and the indirect  owner of 100% of the equity interests in the Co-Issuers (the “Parent”), solely for purposes of Section 6.02  and 8.03 hereof;                (c)    SPIRIT REALTY, L.P., a Delaware limited partnership as the Property Manager   under the Property Management Agreement, solely for purposes of Section 6.03 and 8.02 hereof;                (d)    the several commercial paper conduits listed on Schedule I as Conduit Investors,  and their respective permitted successors and assigns (each, a “Conduit Investor” and, collectively, the  “Conduit Investors”);                (e)    the several financial institutions listed on Schedule I as Committed Note  Purchasers, and their respective permitted successors and assigns (each, a “Committed Note Purchaser”  and, collectively, the “Committed Note Purchasers”);                (f)    for each Investor Group, the financial institution entitled to act on behalf of the  Investor Group set forth opposite the name of such Investor Group on Schedule I as Funding Agent, and  its permitted successors and assigns (each, the “Funding Agent” with respect to such Investor Group and,  collectively, the “Funding Agents”); and                (g)    BARCLAYS BANK PLC, as administrative agent for the Conduit Investors, the  Committed Note Purchasers and the Funding Agents (together with its permitted successors and assigns  in such capacity, the “Administrative Agent”).                                       BACKGROUND                1.     The Co-Issuers and Citibank, N.A., as the indenture trustee (together with its  permitted successors and assigns in such capacity, the “Indenture Trustee”) are party to the Indenture,  dated as of May 20, 2014 (as the same has been amended, supplemented and modified prior to the date  hereof, and as the same may be amended, amended and restated, supplemented or otherwise modified  from time to time in accordance with the terms thereof, including by the Series 2018-1 Supplement the  “Indenture”), and contemporaneously with the execution and delivery of this Agreement, the Co-Issuers  and the Indenture Trustee are entering into the Series 2018-1 Supplement to the Indenture (as the same  may be amended, amended and restated, supplemented or otherwise modified from time to time in  accordance with the terms thereof, the “Series 2018-1 Supplement”), pursuant to which the Co-Issuers  will issue the Series 2018-1 Class A Notes in accordance with the Indenture and the Series 2018-1  Supplement.                2.     The Co-Issuers wish to issue the Series 2018-1 Class A Notes to each Funding  Agent on behalf of the Investors in the related Investor Group, and obtain the agreement of the applicable                                              1  DMSLIBRARY01\32647597  

 

   Investors to make advances of loans from time to time (each, an “Advance” or a “Series 2018-1 Class A  Advance” and, collectively, the “Advances” or the “Series 2018-1 Class A Advances”) that will constitute  the purchase of increases to the Series 2018-1 Class A Outstanding Principal Amount on the terms and  conditions set forth in this Agreement.                  3.     Each of the Parent and the Property Manager has joined in this Agreement to  make certain representations, warranties, covenants and agreements for the benefit of each Investor, the  Administrative Agent and each Funding Agent.                                         ARTICLE I                                       DEFINITIONS                SECTION 1.01     Definitions. As used in this Agreement and unless the context  requires a different meaning, capitalized terms used but not defined herein (including the preamble and  the recitals hereto) shall have the meanings assigned to such terms in the Indenture and, to the extent not  defined therein, in the Series 2018-1 Supplement.  Unless otherwise specified herein, all Article, Exhibit,  Section or Subsection references herein shall refer to Articles, Exhibits, Sections or Subsections of this  Agreement.  The following terms shall have the following meanings for purposes of this Agreement:         “Acquiring Committed Note Purchaser” has the meaning set forth in Section 9.17(a).         “Acquiring Investor Group” has the meaning set forth in Section 9.17(c).         “Advance” or “Advances” has the meaning set forth in the recitals hereto.         “Advance Request” has the meaning specified in Section 7.03(d).         “Affected Person” has the meaning specified in Section 3.05.         “Aggregate Unpaids” has the meaning specified in Section 5.01.         “Agreement” has the meaning specified in the preamble hereto.  This Agreement shall be a  Variable Funding Note Purchase Agreement for all purposes under the Indenture, the Series 2018-1  Supplement and this Agreement.          “Annual Inspection Notice” has the meaning specified in Section 8.01(d).         “Assignment and Assumption Agreement” has the meaning set forth in Section 9.17(a).         “Bankruptcy Code” shall mean Title 11 of the United States Code, as amended from time to time,  and all rules and regulations promulgated thereunder.          “Base Rate”  means, for purposes of the Series 2018-1 Class A Notes when applicable pursuant to  this Agreement on any day, a rate per annum equal to the sum of (a) 1.10 % plus (b) the greater of (i) the  Prime Rate in effect on such day, (ii) the Federal Funds Rate in effect on such day plus 0.50% and (iii) the  Eurodollar Funding Rate (Reserve Adjusted) for a Eurodollar Interest Accrual Period with a maturity of  one month as in effect on such day plus 1.00%; provided that any change in the Base Rate due to a change  in the Prime Rate or the Federal Funds Rate shall be effective as of the opening of business on the  effective day of such change in the Prime Rate or the Federal Funds Rate, respectively; provided, further,  that changes in any rate of interest calculated by reference to the Base Rate shall take effect                                               2  DMSLIBRARY01\32647597  

 

   simultaneously with each change in the Base Rate and the Base Rate will in no event be higher than the  maximum rate permitted by applicable law.          “Base Rate Advance” means a Series 2018-1 Class A Advance that bears interest at the Base Rate  during such time as it bears interest at such rate, as provided in this Agreement.          “Borrowing” has the meaning set forth in Section 2.02(c).         “Breakage Amount” has the meaning set forth in Section 3.06.         “Change in Law” means (a) any law, rule or regulation or any change therein or in the  interpretation or application thereof (whether or not having the force of law), in each case, adopted, issued  or occurring after the Series 2018-1 Closing Date or (b) any request, guideline or directive (whether or not  having the force of law) from any government or political subdivision or agency, authority, bureau,  central bank, commission, department or instrumentality thereof, or any court, tribunal, grand jury or  arbitrator, or any accounting board or authority (whether or not a Governmental Authority) which is  responsible for the establishment or interpretation of national or international accounting principles, in  each case, whether foreign or domestic (each, an “Official Body”) charged with the administration,  interpretation or application thereof, or the compliance with any request or directive of any Official Body  (whether or not having the force of law) made, issued or occurring after the Series 2018-1 Closing Date.          “Class A Amendment Expenses” means the amounts payable to the Administrative Agent, each  Funding Agent and each Investor in connection with any amendments, waivers, consents, supplements or  other modifications to the Series 2018-1 Supplement or any other Transaction Document pursuant to  Section 9.05(a).         “Class A Indemnities” means all amounts payable pursuant to Section 9.05(b) and Section  9.05(c).         “Class A LTV Ratio” shall mean, as of any date, the ratio, expressed as a fraction, (a) the  numerator of which is the Aggregate Note Principal Balances of all Outstanding Notes at such time and  (b) the denominator of which is equal to the sum of (x) the Aggregate Collateral Value of the Qualified  Mortgage Loans and the Qualified Mortgaged Properties (that do not otherwise secure Mortgage Loans)  that are included in the Collateral Pool at such time (which in any event shall not include the aggregate  amount by which the Asset Concentrations exceed the applicable Maximum Asset Concentration with  respect to such Qualified Mortgage Loans and the Qualified Mortgaged Properties) and (y) the aggregate  Net Release Price amount on deposit in the Release Account as of such date.           “Class A Taxes” has the meaning specified in Section 3.08(a).         “Co-Issuers” has the meaning specified in the preamble hereto.         “Commercial Paper” means, with respect to any Conduit Investor, the short-term promissory  notes issued in the commercial paper market by or for the benefit of such Conduit Investor.          “Commitment” means the commitment of each Committed Note Purchaser included in each  Investor Group to fund Series 2018-1 Class A Advances pursuant to Section 2.02(a) in an aggregate  amount up to its Commitment Amount.          “Commitment Amount” means, as to each Committed Note Purchaser, the amount set forth on  Schedule I attached hereto opposite such Committed Note Purchaser’s name as its Commitment Amount                                              3  DMSLIBRARY01\32647597  

 

   or, in the case of a Committed Note Purchaser that becomes a party to this Agreement pursuant to an  Assignment and Assumption Agreement or Investor Group Supplement, the amount set forth therein as  such Committed Note Purchaser’s Commitment Amount, in each case, as such amount may be (i) reduced  pursuant to Section 2.05 or (ii) increased or reduced by any Assignment and Assumption Agreement or  Investor Group Supplement entered into by such Committed Note Purchaser in accordance with the terms  of this Agreement.          “Commitment Percentage” means, on any date of determination, with respect to any Investor  Group, the ratio, expressed as a percentage, which such Investor Group’s Maximum Investor Group  Principal Amount bears to the Series 2018-1 Class A Notes Maximum Principal Amount on such date.          “Commitment Term” means the period from and including the Series 2018-1 Closing Date to but  excluding the earlier of (a) the Commitment Termination Date and (b) the date on which the  Commitments are otherwise terminated or reduced to zero in accordance with this Agreement.          “Commitment Termination Date” means November 1, 2021.          “Committed Note Purchaser” and “Committed Note Purchasers” have the meaning specified in  the preamble hereto.          “Committed Note Purchaser Percentage” means, on any date of determination, with respect to  any Committed Note Purchaser in any Investor Group, the ratio, expressed as a percentage, which the  Commitment Amount of such Committed Note Purchaser bears to such Investor Group’s Maximum  Investor Group Principal Amount on such date.          “Conduit Assignee” means, with respect to any Conduit Investor, any commercial paper conduit,  whose Commercial Paper is rated at least “A-2” from S&P and/or the equivalent rating of another  “nationally-recognized statistical rating organization” registered with the SEC, that is administered by the  Funding Agent (or for which the related Program Support Provider provides liquidity support) with  respect to such Conduit Investor or any Affiliate of such Funding Agent, in each case, designated by such  Funding Agent to accept an assignment from such Conduit Investor of the Investor Group Principal  Amount or a portion thereof with respect to such Conduit Investor pursuant to Section 9.17(b).          “Conduit Investor” and “Conduit Investors” have the meaning specified in the preamble hereto.         “Conduit Investor Amounts” has the meaning specified in Section 9.10(c).           “CP Advance” means a Series 2018-1 Class A Advance funded or maintained through the  issuance of Commercial Paper that bears interest at the CP Rate during such time as it bears interest at  such rate, as provided herein.          “CP Funding Rate” means, with respect to each Conduit Investor, for any day during any Interest  Accrual Period, for any CP Advance funded by such Conduit Investor, the per annum rate equivalent to  the weighted average cost (as determined by the related Funding Agent, and which shall include (without  duplication) the fees and commissions of placement agents and dealers, incremental carrying costs  incurred with respect to Commercial Paper maturing on dates other than those on which corresponding  funds are received by such Conduit Investor, other borrowings by such Conduit Investor and any other  costs associated with the issuance of Commercial Paper) of or related to the issuance of Commercial  Paper that are allocated, in whole or in part, by such Conduit Investor or its related Funding Agent to fund  or maintain such CP Advances for such Interest Accrual Period (and which may also be allocated in part  to the funding of other assets of the Conduit Investor); provided, however, that if any component of any                                              4  DMSLIBRARY01\32647597  

 

   such rate is a discount rate, in calculating the “CP Funding Rate” for such CP Advances for such Interest  Accrual Period, the related Funding Agent shall for such component use the rate resulting from  converting such discount rate to an interest bearing equivalent rate per annum.           “CP Rate” means, on any day during any Interest Accrual Period, an interest rate per annum equal  to the sum of (i) the CP Funding Rate for such Interest Accrual Period plus (ii) 2.10 %; provided, that the  CP Rate will in no event be higher than the maximum rate permitted by applicable law.          “Decrease” means a Mandatory Decrease or a Voluntary Decrease, as applicable.         “Default” means any event, occurrence or circumstance that is, or with notice or the lapse of time  or both, would become, an Event of Default.          “Defaulting Agent Event” has the meaning set forth in Section 5.07(b).         “Defaulting Investor” means any Investor that has (a) failed to make a payment required to be  made by it under the terms hereof within one (1) Business Day of the day such payment is required to be  made by such Investor hereunder, (b) notified the related Funding Agent in writing that it does not intend  to make any payment required to be made by it under the terms hereof within one (1) Business Day of the  day such payment is required to be made by such Investor hereunder, (c) become the subject of an Event  of Bankruptcy or (d) become the subject of a Bail-In Action.          “Eligible Assignee” has the meaning set forth in Section 9.17(a).         “Eligible Conduit Investor” means, at any time, any Conduit Investor whose Commercial Paper is  rated at least A-2 from S&P and/or the equivalent rating of another “nationally-recognized statistical  rating organization” registered with the SEC.          “E.U. Capital Requirements Regulation” has the meaning specified in Section 6.02(b).         “E.U. Retained Interest” has the meaning specified in Section 8.02(b).         “E.U. Retention Regulatory Change Event” means any change in, or the adoption of, any new  law, rule, direction, guidance or regulation which (i) requires the manner in which the E.U. Retention  Interest is held by Spirit MTA REIT to be restructured after the Series 2018-1 Closing Date and Spirit  MTA REIT is unable to reasonably restructure such E.U. Retention Interest or (ii) otherwise results in the  securitization transaction contemplated by the Transaction Documents becoming non-compliant with the  E.U. Retention Requirements.          “E.U. Retention Requirements” has the meaning specified in Section 8.02(b).         “Eurodollar Advance” means a Series 2018-1 Class A Advance that bears interest at the  Eurodollar Rate during such time as it bears interest at such rate, as provided herein.         “Eurodollar Business Day” means any Business Day on which dealings are also carried on in the  London interbank market and banks are open for business in London.         “Eurodollar Funding Rate” means, for any Eurodollar Interest Accrual Period, (i) the rate per  annum determined by the Administrative Agent at approximately 11:00 a.m. (London time) on the date  that is two Eurodollar Business Days prior to the beginning of such Eurodollar Interest Accrual Period on  the page of the Reuters screen which displays the London interbank offered rate administered by ICE                                              5  DMSLIBRARY01\32647597  

 

   Benchmark Administration Limited or any other Person that takes over the administration of such rate for  U.S. dollars (such page currently being the LIBOR01 page) for deposits (for delivery on the first day of  such Eurodollar Interest Accrual Period) with a term for a period equal to such Eurodollar Interest  Accrual Period; or (ii) to the extent that an interest rate referenced in the preceding clause (i) does not  appear on such page or service or if such page or service shall cease to be available, the “Eurodollar  Funding Rate” shall be the rate (rounded upward, if necessary, to the nearest one hundred-thousandth of a  percentage point), determined by the Administrative Agent to be the offered rate on such other page or  other service which displays the rate per annum for deposits in U.S. dollars (for delivery on the first day  of such Eurodollar Interest Accrual Period) with a term equal to such Eurodollar Interest Accrual Period  offered by participants in the London interbank market, determined as of approximately 11:00 a.m.  (London, England time) two Eurodollar Business Days prior to the commencement of such Eurodollar  Interest Accrual Period (unless the Administrative Agent is unable to obtain such rates from such banks,  in which case it will be deemed that a Eurodollar Funding Rate cannot be ascertained in the circumstances  set forth in Section 3.04).  In respect of any Eurodollar Interest Accrual Period that is less than one month  in duration and if no Eurodollar Funding Rate is otherwise determinable with respect thereto in  accordance with the preceding sentence of this definition, the Eurodollar Funding Rate shall be  determined through the use of straight-line interpolation by reference to two rates calculated in  accordance with the preceding sentence, one of which shall be determined as if the maturity of the Dollar  deposits referred to therein were the period of time for which rates are available next shorter than the  Eurodollar Interest Accrual Period and the other of which shall be determined as if such maturity were the  period of time for which rates are available next longer than the Eurodollar Interest Accrual Period.  If  any such rate determined pursuant to this definition of “Eurodollar Funding Rate” is below zero, the  Eurodollar Funding Rate will be deemed to be zero.  The determination of the Eurodollar Funding Rate  shall be made subject to Section 3.04(b).           “Eurodollar Funding Rate (Reserve Adjusted)” means, for any Eurodollar Interest Accrual  Period, an interest rate per annum (rounded upward to the nearest 1/100th of 1%) determined pursuant to  the following formula:                Eurodollar Funding Rate     Eurodollar Funding Rate                                        =               (Reserve Adjusted)          1.00 - Eurodollar Reserve Percentage   The Eurodollar Funding Rate (Reserve Adjusted) for any Eurodollar Interest Accrual Period will be  determined by Administrative Agent on the basis of the Eurodollar Reserve Percentage in effect two (2)  Eurodollar Business Days before the first day of such Eurodollar Interest Accrual Period.          “Eurodollar Interest Accrual Period” means, with respect to any Eurodollar Advance, the period  commencing on and including the Eurodollar Business Day such Series 2018-1 Class A Advance first  becomes a Eurodollar Advance in accordance with Section 3.01(b) and ending on but excluding, at the  election of the Co-Issuers pursuant to Section 3.01(b), a date (i) one (1) month subsequent to such date,  (ii) two (2) months subsequent to such date, (iii) three (3) months subsequent to such date or (iv) six (6)  months subsequent to such date; provided, however, that no Eurodollar Interest Accrual Period may end  subsequent to the second Business Day before the then-current Series 2018-1 Class A Anticipated  Repayment Date, and upon the occurrence and during the continuation of any Early Amortization Event  or Event of Default, any Eurodollar Interest Accrual Period with respect to the Eurodollar Advances of all  Investor Groups may be terminated at the end of the then-current Eurodollar Interest Accrual Period (or,  if the Series 2018-1 Class A Notes have been accelerated in accordance with Section 4.02 of the  Indenture, immediately), at the election of the Administrative Agent or Investor Groups holding in the  aggregate more than 50% of the Eurodollar Tranche, by notice to the Co-Issuers, the Property Manager  and the Funding Agents, and upon such election the Eurodollar Advances in respect of which interest was                                              6  DMSLIBRARY01\32647597  

 

   calculated by reference to such terminated Eurodollar Interest Accrual Period shall be converted to Base  Rate Advances.          “Eurodollar Rate” means, on any day during any Eurodollar Interest Accrual Period, an interest  rate per annum equal to the sum of (i) the Eurodollar Funding Rate (Reserve Adjusted) for such  Eurodollar Interest Accrual Period plus (ii) 2.10%; provided, that the Eurodollar Rate will in no event be  higher than the maximum rate permitted by applicable law.          “Eurodollar Reserve Percentage” means, for any Eurodollar Interest Accrual Period, the reserve  percentage (expressed as a decimal) equal to the maximum aggregate reserve requirements (including all  basic, emergency, supplemental, marginal and other reserves and taking into account any transitional  adjustments or other scheduled changes in reserve requirements) specified under regulations issued from  time to time by the F.R.S. Board and then applicable to liabilities or assets constituting “Eurocurrency  Liabilities,” as currently defined in Regulation D of the F.R.S. Board, having a term approximately equal  or comparable to such Eurodollar Interest Accrual Period.          “Eurodollar Tranche” means any portion of the Series 2018-1 Class A Outstanding Principal  Amount funded or maintained with Eurodollar Advances.          “Event of Bankruptcy” means, with respect to any Person, (i) a court enters a decree or order for  relief with respect to such Person in an Involuntary Bankruptcy, which decree or order is not stayed or  other similar relief is not granted under any applicable federal or state law unless dismissed within sixty  (60) days or an order for relief is entered with respect to such Person or such Person commences a  voluntary case under the Bankruptcy Code or any applicable bankruptcy, insolvency or other similar law  now or hereafter in effect, or consents to the entry of an order for relief in an involuntary case or to the  conversion of an involuntary case to a voluntary case under any such law or consents to the appointment  of or taking possession by a receiver, trustee or other custodian for such Person, for all or a substantial  part of the property of such Person.          “FATCA” means (a) Sections 1471 through 1474 of the Code, as of the date of this Agreement  (or any amended or successor version that is substantively comparable and not materially more onerous to  comply with), any current or future regulations thereunder or official interpretations thereof, (b) any  agreements entered into pursuant to Section 1471(b)(1) of the Code and (c) any fiscal or regulatory  legislation, rules or other practices adopted pursuant to any intergovernmental agreement, treaty or  convention among Governmental Authorities and implementing such Sections of the Code.          “Federal Funds Rate” means, for any specified period, a fluctuating interest rate per annum equal  for each day during such period to the weighted average of the overnight federal funds rates as published  in Federal Reserve Board Statistical Release H.15(519) or any successor or substitute publication selected  by the Administrative Agent (or, if such day is not a Business Day, for the next preceding Business Day),  or if, for any reason, such rate is not available on any day, the rate determined, in the reasonable opinion  of the Administrative Agent, to be the rate at which overnight federal funds are being offered in the  national federal funds market at 9:00 a.m. (New York City time).         “F.R.S. Board” means the Board of Governors of the Federal Reserve System.         “Funding Agent” and “Funding Agents” have the meaning specified in the preamble hereto.          “Increased Capital Costs” has the meaning set forth in Section 3.07.         “Increased Costs” has the meaning set forth in Section 3.05.                                              7  DMSLIBRARY01\32647597  

 

         “Increased Tax Costs” has the meaning set forth in Section 3.08(b).         “Indemnified Liabilities” has the meaning set forth in Section 9.05(b).         “Indemnified Parties” has the meaning set forth in Section 9.05(b).         “Investor” means any one of the Conduit Investors and the Committed Note Purchasers, and  “Investors” means the Conduit Investors and the Committed Note Purchasers collectively.         “Investor Group” means (i) for each Conduit Investor, collectively, such Conduit Investor, the  related Committed Note Purchaser(s) set forth opposite the name of such Conduit Investor on Schedule I  attached hereto (or, if applicable, set forth for such Conduit Investor in the Assignment and Assumption  Agreement or Investor Group Supplement pursuant to which such Conduit Investor or Committed Note  Purchaser becomes a party hereto), any related Program Support Provider(s) and the related Funding  Agent (which shall constitute the Series 2018-1 Class A Noteholder for such Investor Group) and (ii) for  each other Committed Note Purchaser that is not related to a Conduit Investor, collectively, such  Committed Note Purchaser, any related Program Support Provider(s) and the related Funding Agent  (which shall constitute the Series 2018-1 Class A Noteholder for such Investor Group).          “Investor Group Borrowing Amount” means, with respect to any Investor Group, for any  Business Day, the portion of a Borrowing, if any, actually funded by such Investor Group on such  Business Day.          “Investor Group Principal Amount” means, with respect to any Investor Group, (a) when used  with respect to the Investor Groups that exist as of the Series 2018-1 Closing Date, an amount equal to   such Investor Group’s Commitment Percentage of the Series 2018-1 Class A Initial Advance Principal  Amount, if any, and (b) when used with respect to the Investor Groups that exist as of any other date  (including with respect to any Investor Groups that exist as of any other date pursuant to an Assignment  and Assumption Agreement or an Investor Group Supplement), an amount equal to (i) the Investor Group  Principal Amount with respect to such Investor Group on the immediately preceding Business Day  (including after giving effect to the assignment under any Assignment and Assumption Agreement or  Investor Group Supplement) plus (ii) the Investor Group Borrowing Amount with respect to such Investor  Group on such date minus (iii) the amount of principal payments made to such Investor Group on the  Series 2018-1 Class A Notes on such date.          “Investor Group Supplement” has the meaning set forth in Section 9.17(c).         “Involuntary Bankruptcy” shall mean any involuntary case under the Bankruptcy Code or any  applicable bankruptcy, insolvency or other similar law now or hereafter in effect, in which any Person is a  debtor.          “Joinder Agreement” has the meaning specified in Section 8.01(h).         “Lender Party” means any Investor, and “Lender Parties” means the Investors, collectively.         “LIBOR Successor Event” has the meaning set forth in Section 3.04.          “LIBOR Successor Rate Conforming Changes” has the meaning set forth in Section 3.04.          “Margin Stock” has the meaning specified in Section 8.01(e).                                               8  DMSLIBRARY01\32647597  

 

         “Maximum Investor Group Principal Amount” means, as to each Investor Group existing on the  Series 2018-1 Closing Date, the amount set forth on Schedule I  attached hereto as such Investor Group’s  Maximum Investor Group Principal Amount or, in the case of any other Investor Group, the amount set  forth as such Investor Group’s Maximum Investor Group Principal Amount in the Assignment and  Assumption Agreement or Investor Group Supplement by which the members of such Investor Group  become parties hereto, in each case, as such amount may be (i) reduced pursuant to Section 2.05 or  (ii) increased or reduced by any Assignment and Assumption Agreement or Investor Group Supplement  entered into by the members of such Investor Group in accordance with the terms hereof.          “Non-Excluded Taxes” has the meaning set forth in Section 3.08(a).         “Non-Funding Committed Note Purchaser” has the meaning set forth in Section 2.02(a).         “Other Class A Transaction Expenses” means all amounts payable pursuant to Section 9.05(a)  including Class A Amendment Expenses.          “Parent” has the meaning specified in the preamble hereto.         “Prime Rate” means the rate of interest publicly announced from time to time by a commercial  bank mutually agreed upon by the Property Manager and the Special Servicer as its reference rate, base  rate or prime rate.          “Priority of Payments” means the priority of payments for the application of funds on each  Payment Date set forth in Section 2.11 of the Indenture.         “Program Support Agreement” means, with respect to any Conduit Investor, any agreement  entered into by any Program Support Provider in respect of any Commercial Paper and/or Series 2018-1  Class A Note of such Conduit Investor providing for the issuance of one or more letters of credit for the  account of such Conduit Investor, the issuance of one or more insurance policies for which such Conduit  Investor is obligated to reimburse the applicable Program Support Provider for any drawings thereunder,  the sale by such Conduit Investor to any Program Support Provider of the Series 2018-1 Class A Notes  (or portions thereof or interests therein) and/or the making of loans and/or other extensions of credit to  such Conduit Investor in connection with such Conduit Investor’s securitization program, together with  any letter of credit, insurance policy or other instrument issued thereunder or guaranty thereof (but  excluding any discretionary advance facility provided by a Committed Note Purchaser).          “Program Support Provider” means, with respect to any Conduit Investor, any financial  institutions and any other or additional Person now or hereafter extending credit or having a commitment  to extend credit to or for the account of, and/or agreeing to make purchases from, such Conduit Investor  in respect of such Conduit Investor’s Commercial Paper and/or Series 2018-1 Class A Note, and/or  agreeing to issue a letter of credit or insurance policy or other instrument to support any obligations  arising under or in connection with such Conduit Investor’s securitization program as it relates to any  Commercial Paper issued by such Conduit Investor, and/or holding equity interests in such Investor, in  each case pursuant to a Program Support Agreement, and any guarantor of any such Person.          “Qualified Mortgage Loan” means each Mortgage Loan (i) that is secured by one or more  Mortgaged Properties that would constitute a Qualified Mortgaged Property, (ii) that pays interest and, if  applicable, principal on a monthly basis, and (iii) for which the applicable representations and warranties  set forth on Schedule II-A to the Indenture are true and correct as of the date specified in such  representation or warranty or, in the event no such date is specified with respect to any such  representation or warranty, as of the applicable Transfer Date (except for any such representations and                                              9  DMSLIBRARY01\32647597  

 

   warranties that were not true and correct at such time but for which the Rating Agency Notification  Condition was satisfied in connection with such acquisition).          “Qualified Mortgaged Properties” means any commercial real estate property held by an Issuer  that is a Mortgaged Property (including any Leasehold Mortgaged Property) and (a) with respect to any  Mortgaged Property acquired by the Co-Issuers after the Series 2018-1 Closing Date (i) that is not an  Environmental Condition Mortgaged Property (which for purposes of this definition shall include any  Mortgaged Property for which a Phase II Environmental Assessment or comparable environmental  assessment has been conducted, unless such assessment has been completed and has not identified any  recognized environmental conditions that require further investigation or remediation, (ii) is not vacant  and is either (x) leased pursuant to a “triple net” lease or (y) leased pursuant to a “double net” lease, (iii)  that, as of the applicable Transfer Date thereof, (1) the remaining term to maturity of the related lease is  no less than five (5) years from such Transfer Date and (2) has an appraisal that meets the applicable  requirements set forth in the definition of “Appraised Value” as if such Mortgaged Property were a  Qualified Substitute Mortgage Loan or Qualified Substitute Mortgaged Property added to the Collateral  Pool, which appraisal has been obtained within 12 months prior to such Transfer Date, (iv) that is leased  to a Tenant that is not the subject of any bankruptcy or insolvency proceeding, (v) for which the Fixed  Charge Coverage Ratio (as defined in the Property Management Agreement) is greater than 1.00:1.00,  and (vi) for which the annual cash income, rent, profit and proceeds derived by the Issuer from the  ownership, operation or leasing of such Mortgaged Property is no less than 5% of the Appraised Value of  such Mortgaged Property and (b) with respect to all Mortgaged Properties, for which the applicable  representations and warranties set forth on Schedule II-B to the Indenture are true and correct as of the  date specified in such representation or warranty or, in the event no such date is specified with respect to  any such representation or warranty, as of the applicable Transfer Date (except for any such  representations and warranties that were not true and correct at such time but for which the Rating  Agency Notification Condition was satisfied in connection with such acquisition).          “Requirement of Law” means, with respect to any Person or any of its property, the certificate of  incorporation or articles of association and bylaws, limited liability company agreement, partnership  agreement or other organizational or governing documents of such Person or any of its property, and any  law, treaty, rule or regulation, or determination of any arbitrator or Governmental Authority, in each case  applicable to, or binding upon, such Person or any of its property or to which such Person or any of its  property is subject, whether federal, state, local or foreign (including usury laws, the Federal Truth in  Lending Act, state franchise laws and retail installment sales acts).          “Retained Interest” has the meaning specified in Section 6.02(a).         “Series 2018-1 Class A Advance” and “Series 2018-1 Class A Advances” have the meaning set  forth in the recitals hereto.          “Series 2018-1 Class A Advance Request” has the meaning specified in Section 7.03(e).         “Series 2018-1 Class A Anticipated Repayment Date” means the “Anticipated Repayment Date”  as defined in the Series 2018-1 Supplement.          “Series 2018-1 Class A Initial Advance” shall mean the initial Series 2018-1 Class A Advance, if  any, made pursuant to Section 2.02 on the Series 2018-1 Closing Date.         “Series 2018-1 Class A Initial Advance Principal Amount” means the aggregate initial  outstanding principal amount of the Series 2018-1 Class A Notes corresponding to the aggregate amount                                              10  DMSLIBRARY01\32647597  

 

   of the Series 2018-1 Class A Initial Advances made on the Series 2018-1 Closing Date pursuant to  Section 2.02.         “Series 2018-1 Class A Noteholders” means the Investors as Holders of the Series 2018-1 Class  A Notes.          “Series 2018-1 Class A Notes” means the $50,000,000 Net-Lease Mortgage Variable Funding  Notes, Series 2018-1, Class A, issued by the Co-Issuers pursuant to the Indenture, as supplemented by the  Series 2018-1 Supplement.  The Series 2018-1 Class A Notes shall be Variable Funding Notes that are  Class A Notes payable in accordance with the Indenture, the Series 2018-1 Supplement and this  Agreement.          “Series 2018-1 Class A Notes Fee Letter” means the fee letter, dated on or prior to the Series  2018-1 Closing Date, by and among the Co-Issuers and the Committed Note Purchasers.          “Series 2018-1 Class A Notes Maximum Principal Amount” means $50,000,000, as such amount  may be reduced pursuant to Section 2.05.         “Series 2018-1 Class A Notes Other Amounts” means, as of any date of determination, the  aggregate amount of any Breakage Amount, Class A Indemnities, Increased Capital Costs, Increased  Costs, Increased Tax Costs and Other Class A Transaction Expenses then due and payable and not  previously paid.          “Series 2018-1 Class A Notes Upfront Fee” has the meaning set forth in the Series 2018-1 Class  A Notes Fee Letter.          “Series 2018-1 Class A Outstanding Principal Amount” means, when used with respect to any  date, an amount equal to (a) the Series 2018-1 Class A Initial Advance Principal Amount, if any, minus  (b) the amount of principal payments (whether pursuant to a Decrease, a prepayment, a redemption or  otherwise) made on the Series 2018-1 Class A Notes on or prior to such date plus (c) any Increases in the  Series 2018-1 Class A Outstanding Principal Amount resulting from Series 2018-1 Class A Advances  made on or prior to such date and after the Series 2018-1 Closing Date; provided, that, at no time may the  Series 2018-1 Class A Outstanding Principal Amount exceed the Series 2018-1 Class A Notes Maximum  Principal Amount. For purposes of the Indenture, the “Series 2018-1 Class A Outstanding Principal  Amount” shall be the outstanding principal amount of the Series 2018-1 Class A Notes.          “Series 2018-1 Class A Post-ARD Additional Interest” shall mean the interest that accrues on the  Series 2018-1 Class A Outstanding Principal Amount at the Series 2018-1 Class A Post-ARD Additional  Interest Rate pursuant to the Indenture, the Series 2018-1 Supplement and Section 3.01(c).         “Series 2018-1 Class A Post-ARD Additional Interest Rate” shall mean a rate per annum equal to  5.0%, which shall be the “Post-ARD Additional Interest Rate” on the Series 2018-1 Class A Notes for all  purposes of the Indenture and the Series 2018-1 Supplement.          “Series 2018-1 Class A Undrawn Commitment Fees” has the meaning specified in Section  3.02(c).         “Series 2018-1 Closing Date” shall mean the date of this Agreement.         “Series 2018-1 Notes” means the Series 2018-1 Class A Notes.                                              11  DMSLIBRARY01\32647597  

 

         “Series 2018-1 Supplement” means the Series 2018-1 Supplement, dated as of the date hereof, to  the Indenture, entered into by the Co-Issuers and the Indenture Trustee, pursuant to which the Series  2018-1 Notes are issued.           “U.S. Risk Retention Rules” has the meaning specified in Section 6.02(a).         “Voluntary Decrease” has the meaning specified in Section 2.02(d).  A Voluntary Decrease shall  be a “VFN Optional Prepayment” for purposes of the Indenture and the Series 2018-1 Supplement.                                         ARTICLE II                  PURCHASE AND SALE OF SERIES 2018-1 CLASS A NOTES                SECTION 2.01     Series 2018-1 Class A Notes. On the terms and conditions set forth  in this Agreement, the Indenture and the Series 2018-1 Supplement, and in reliance on the  representations, warranties, covenants and agreements set forth herein and therein, the Co-Issuers shall  issue and shall request the Indenture Trustee to authenticate pursuant to Section 2.02(c) of the Indenture,   the Series 2018-1 Supplement and the Series 2018-1 Class A Notes, which the Co-Issuers shall deliver to  each Funding Agent on behalf of the Investors in the related Investor Group on the Series 2018-1 Closing  Date.  Such Series 2018-1 Class A Note for each Investor Group shall be dated the Series 2018-1 Closing  Date, shall be registered in the name of the related Funding Agent or its nominee, as agent for the related  Investors, or in such other name or nominee as such Funding Agent may request, shall have a maximum  principal amount equal to the Maximum Investor Group Principal Amount for such Investor Group, shall  have an initial outstanding principal amount equal to such Investor Group’s Commitment Percentage of  the Series 2018-1 Class A Initial Advance Principal Amount, if any, and shall be duly authenticated in  accordance with the provisions of Section 2.02(a) of the Indenture.  The issuance and sale of the Series  2018-1 Class A Notes to the Series 2018-1 Class A Noteholders shall be subject to satisfaction of the  conditions set forth in Section 7.01 in addition to the conditions to the issuance of a Series of Notes set  forth in Section 2.04(e) of the Indenture. The Series 2018-1 Class A Notes shall be Variable Funding  Notes that are Class A Notes payable in accordance with the Indenture, the Series 2018-1 Supplement and  this Agreement.  This Agreement shall be a Variable Funding Note Purchase Agreement for all purposes  under the Indenture and the Series 2018-1 Supplement.                  SECTION 2.02     Advances; Voluntary Decreases; Mandatory Decreases.                       (a)  Subject to the terms and conditions of this Agreement, the Indenture and  the Series 2018-1 Supplement, including, without limitation, the conditions to the initial extension of  credit set forth in Section 7.02 and the conditions to each extension of credit set forth in Section 7.03,  each Eligible Conduit Investor, if any, may, in its sole discretion, and if such Eligible Conduit Investor  determines that it will not make (or it does not in fact make) an Advance or any portion of an Advance, its  related Committed Note Purchaser(s) shall or, if there is no Eligible Conduit Investor with respect to any  Investor Group, the Committed Note Purchaser(s) with respect to such Investor Group shall, upon the Co- Issuers’ request for a Borrowing delivered in accordance with the provisions of Section 2.03 and the  satisfaction of all conditions precedent thereto, make Advances from time to time during the Commitment  Term; provided, that such Advances shall be made ratably by each Investor Group based on their  respective Commitment Percentages and the portion of any such Advance made by any Committed Note  Purchaser in such Investor Group shall be its Committed Note Purchaser Percentage of the Advances to  be made by such Investor Group (or the portion thereof not being made by any Conduit Investor in such  Investor Group); provided, further, that if, as a result of any Committed Note Purchaser (a “Non-Funding  Committed Note Purchaser”) failing to make any previous Advance that such Non-Funding Committed  Note Purchaser was required to make, outstanding Advances are not held ratably by each Investor Group  based on their respective Commitment Percentages and among the Committed Note Purchasers within                                             12  DMSLIBRARY01\32647597  

 

   each Investor Group based on their respective Committed Note Purchaser Percentages at the time a  request for Advances is made, (x) such Non-Funding Committed Note Purchaser shall make all of such  Advances until outstanding Advances are held ratably by each Investor Group based on their respective  Commitment Percentages and among the Committed Note Purchasers within each Investor Group based  on their respective Committed Note Purchaser Percentages and (y) further Advances shall be made  ratably by each Investor Group based on their respective Commitment Percentages and the portion of any  such Advance made by any Committed Note Purchaser in such Investor Group shall be its Committed  Note Purchaser Percentage of the Advances to be made by such Investor Group (or the portion thereof not  being made by any Conduit Investor in such Investor Group); provided, further, that the failure of a Non- Funding Committed Note Purchaser to make Advances pursuant to the immediately preceding proviso  shall not, subject to the immediately following proviso, relieve any other Committed Note Purchaser of its  obligation hereunder, if any, to make Advances in accordance with Section 2.03(b)(i); provided, further,  that, subject, in the case of clause (i) below, to Section 2.03(b)(ii), no Advance shall be required or  permitted to be made by any Investor on any date to the extent that, after giving effect to such Advance,  (i) the related Investor Group Principal Amount would exceed the related Maximum Investor Group  Principal Amount or (ii) the Series 2018-1 Class A Outstanding Principal Amount would exceed the  Series 2018-1 Class A Notes Maximum Principal Amount.                       (b)  Notwithstanding anything herein or in any other Transaction Document to  the contrary, at no time will a Conduit Investor be obligated to make Advances hereunder. If at any time  any Conduit Investor is not an Eligible Conduit Investor, such Conduit Investor shall deliver prompt  written notice to the Administrative Agent (who shall promptly notify each Funding Agent and the Co- Issuers) thereof.                       (c)  Each of the Advances to be made on any date shall be made as part of a  single borrowing (each such single borrowing being a “Borrowing”). The Advances made as part of the  initial Borrowing on the Series 2018-1 Closing Date, if any, will be evidenced by the Series 2018-1 Class  A Notes issued in connection herewith and will constitute purchases of Series 2018-1 Class A Initial  Advance Principal Amounts corresponding to the amount of such Advances. All of the other Advances  will constitute Borrowings evidenced by the Series 2018-1 Class A Notes issued in connection herewith  and will constitute purchases of Series 2018-1 Class A Outstanding Principal Amounts corresponding to  the amount of such Advances.  The Series 2018-1 Class A Outstanding Principal Amounts shall be the  aggregate unpaid principal balance and the Class Principal Balances of the Series 2018-1 Class A Notes  for all purposes under the Indenture and the Series 2018-1 Supplement.                         (d)  On any Business Day, upon at least three (3) Business Days’ prior written  notice to each of the Funding Agents, the Administrative Agent and the Indenture Trustee, the Co-Issuers  may decrease the Series 2018-1 Class A Outstanding Principal Amount (each such decrease of the Series  2018-1 Class A Outstanding Principal Amount pursuant to this Section 2.02(d), a “Voluntary Decrease”)  by depositing with the Administrative Agent an amount equal to such Voluntary Decrease not later than  12:00 noon (New York City time) on the date specified as the decrease date in the prior written notice  referred to above and providing a written report to the Administrative Agent (with a copy to the Indenture  Trustee) directing the Administrative Agent to distribute to each Investor Group pro rata according to the  portion of the Series 2018-1 Class A Outstanding Principal Amount allocable to each Investor Group  (which report shall include the calculation of such amounts and wiring instructions for the distributions  thereof); provided, that to the extent the deposit with the Administrative Agent described above is not  made by 12:00 noon (New York City time) on a Business Day, the same shall be deemed to be deposited  on the following Business Day.  Any associated Series 2018-1 Class A Breakage Amounts incurred as a  result of such decrease (calculated in accordance with this Agreement) shall be deposited with the  Administrative Agent for allocation pursuant to the report referred to above (other than if the decrease has  occurred in connection with an E.U. Retention Regulatory Change Event).  Each such Voluntary                                             13  DMSLIBRARY01\32647597  

 

   Decrease in respect of any Advances shall be either (i) in an aggregate minimum principal amount of  $200,000 and integral multiples of $100,000 in excess thereof or (ii) in such other amount necessary to  reduce the Series 2018-1 Class A Outstanding Principal Amount to zero.  The failure to pay the amount of  any Voluntary Decrease on the date specified as the decrease date in the related notice shall not constitute  an Event of Default under the Indenture, and any amounts deposited with the Series Administrative Agent  for application in the manner set forth above shall only be so deposited to the extent available in  accordance with the Priority of Payments.                        (e)  Subject to the terms of this Agreement and the Series 2018-1 Supplement,  the aggregate principal amount of the Advances evidenced by the Series 2018-1 Class A Notes may be  increased by Borrowings or decreased by Voluntary Decreases, Mandatory Decreases and such other  amounts that are paid on the Series 2018-1 Class A Notes pursuant to the Priority of Payments from time  to time.                        (f)  In the event that any reallocation of the Series 2018-1 Class A Outstanding  Principal Amount required to be made to ensure that the Series 2018-1 Class A Outstanding Principal  Amount attributable to each Investor Group is pro rata based on its respective Commitment Percentage  would give rise to Series 2018-1 Class A Breakage Amounts, the related breakage shall occur with  respect to the applicable Advance closest to maturity.                 SECTION 2.03     Borrowing Procedures.                       (a)  Whenever the Co-Issuers wish to make a Borrowing, the Co-Issuers shall  (or shall cause the Property Manager on their behalf to) by written notice in the form of an Advance  Request, notify (for which purpose electronic means shall be sufficient) the Administrative Agent (who  shall promptly, and in any event by 4:00 p.m. (New York City time) on the same Business Day as its  receipt of the same, notify each Funding Agent of its pro rata share thereof (or other required share, as  required pursuant to Section 2.02(a)) and notify the Indenture Trustee in writing of such Borrowing) by  written notice in the form of an Advance Request delivered to the Administrative Agent no later than  12:00 p.m. (New York City time) two (2) Business Days (or, in the case of any Eurodollar Advances for  purposes of Section 3.01(b), two (2) Eurodollar Business Days) prior to the date of such Borrowing  (unless a shorter period is agreed upon by the Administrative Agent and the Funding Agents), which date  of Borrowing shall be a Business Day during the Commitment Term.  Each such Advance Request shall  be irrevocable and shall in each case refer to this Agreement and specify (i) the Borrowing date, (ii) the  aggregate amount of the requested Borrowing to be made on such date, and (iii) sufficient instructions for  application of the balance, if any, of the proceeds of such Borrowing on the Borrowing date (which  proceeds shall be made available to the Co-Issuers). Requests for any Borrowing may not be made in an  aggregate principal amount of less than $500,000 or in an aggregate principal amount that is not an  integral multiple of $100,000 in excess thereof (or in each case such other amount as agreed to by the  Administrative Agent).  Subject to the provisos to Section 2.02(a), each Borrowing shall be ratably  allocated among the Investor Groups’ respective Maximum Investor Group Principal Amounts. Each  Funding Agent shall promptly advise its related Conduit Investor, if any, of any notice given pursuant to  this Section 2.03(a) and shall promptly thereafter (but in no event later than 10:00 a.m. (New York City  time) on the date of Borrowing) notify the Administrative Agent, the Co-Issuers and the related  Committed Note Purchaser(s) whether such Conduit Investor has determined to make all or any portion of  the Advances in such Borrowing that are to be made by its Investor Group. On the date of each  Borrowing and subject to the other conditions set forth herein and in the Series 2018-1 Supplement, the  applicable Investors in each Investor Group shall make available to the Administrative Agent the amount  of the Advances in such Borrowing that are to be made by such Investor Group by wire transfer in U.S.  Dollars of such amount in same day funds no later than 11:00 a.m. (New York City time) on the date of  such Borrowing as instructed in the applicable Advance Request and upon receipt thereof the Series                                             14  DMSLIBRARY01\32647597  

 

   2018-1 Administrative Agent shall make such proceeds available by 5:00 p.m. (New York City time) to  the Co-Issuers, as instructed in the applicable Advance Request.                       (b)  (i) The failure of any Committed Note Purchaser to make the Advance to  be made by it as part of any Borrowing shall not relieve any other Committed Note Purchaser (whether or  not in the same Investor Group) of its obligation, if any, hereunder to make its Advance on the date of  such Borrowing, but neither the Committed Note Purchaser nor any other Person shall be responsible for  the failure of any other Committed Note Purchaser to make the Advance to be made by such other  Committed Note Purchaser on the date of any Borrowing and (ii) in the event that one or more Committed  Note Purchasers fails to make its Advance by 11:00 a.m. (New York City time) on the date of such  Borrowing, the Administrative Agent shall deliver written notice (for which purpose electronic means  shall be sufficient) to each of the other Committed Note Purchasers not later than 4:00 p.m. (New York  City time) on such Business Day, and each of the other Committed Note Purchasers shall make available  to the Administrative Agent a supplemental Advance in a principal amount (such amount, the “reference  amount”) equal to the lesser of (a) the aggregate principal Advance that was unfunded multiplied by a  fraction, the numerator of which is the Commitment Amount of such Committed Note Purchaser and the  denominator of which is the aggregate Commitment Amounts of all Committed Note Purchasers (less the  aggregate Commitment Amount of the Committed Note Purchasers failing to make Advances on such  date) and (b) the excess of (i) such Committed Note Purchaser’s Commitment Amount over (ii) the  product of such Committed Note Purchaser’s related Investor Group Principal Amount multiplied by such  Committed Note Purchaser’s Committed Note Purchaser Percentage (after giving effect to all prior  Advances on such date of Borrowing) (provided that a Committed Note Purchaser may (but shall not be  obligated to), on terms and conditions to be agreed upon by such Committed Note Purchaser and the  Administrative Agent, make available to the Administrative Agent a supplemental Advance in a principal  amount in excess of the reference amount; provided, however, that no such supplemental Advance shall  be permitted to be made to the extent that, after giving effect to such Advance, the Series 2018-1 Class A  Outstanding Principal Amount would exceed the Series 2018-1 Class A Notes Maximum Principal  Amount).  Such supplemental Advances shall be made by wire transfer in U.S. Dollars in same day funds  to the Administrative Agent no later than 11:00 a.m. (New York City time) one (1) Business Day  following the date of such Borrowing, and upon receipt thereof the Administrative Agent shall by 5:00  p.m. (New York time) make such proceeds available to the Co-Issuers, as instructed in the applicable  Advance Request. If any Committed Note Purchaser which shall have so failed to fund its Advance shall  subsequently pay such amount, the Administrative Agent shall apply such amount pro rata to repay any  supplemental Advances made by the other Committed Note Purchasers pursuant to this Section 2.03(b).                        (c)  Unless the Administrative Agent shall have received notice from a  Funding Agent prior to the date of any Borrowing that an applicable Investor in the related Investor  Group will not make available to the Administrative Agent such Investor’s share of the Advances to be  made by such Investor Group as part of such Borrowing, the Administrative Agent may (but shall not be  obligated to) assume that such Investor has made such share available to the Administrative Agent on the  date of such Borrowing in accordance with Section 2.02(a) and the Administrative Agent may (but shall  not be obligated to), in reliance upon such assumption, make available to the Co-Issuers on such date a  corresponding amount, and shall, if such corresponding amount has not been made available by such  Investor, make available to the Co-Issuers on such date a corresponding amount once such Investor has  made such portion available to the Administrative Agent. If and to the extent that any Investor shall not  have so made such amount available to the Administrative Agent, such Investor and the Co-Issuers jointly  and severally agree to repay (without duplication) to the Administrative Agent on the next Payment Date  such corresponding amount (in the case of the Co-Issuers, as a payment of principal in accordance with  the Priority of Payments), together with interest thereon, for each day from the date such amount is made  available to the Co-Issuers until the date such amount is repaid to the Administrative Agent, at (i) in the  case of the Co-Issuers, the interest rate applicable at the time to the Advances comprising such Borrowing                                             15  DMSLIBRARY01\32647597  

 

   and (ii) in the case of such Investor, the Federal Funds Rate and without deduction by such Investor for  any withholding taxes. If such Investor shall repay to the Administrative Agent such corresponding  amount, such amount so repaid shall constitute such Investor’s Advance as part of such Borrowing for  purposes of this Agreement.                       (d)  After the Co-Issuers deliver an Advance Request for a Borrowing pursuant  to Section 2.03 hereof, the Funding Agents, on behalf of the Investors, may, not later than 4:00 p.m. New  York City time on the date that is one (1) Business Day prior to the proposed Borrowing date, deliver a  written notice (a “Delayed Funding Notice”, and the date of such delivery, the “Delayed Funding Notice  Date”) to the Co-Issuers of their intention to fund the related Borrowing (such amount, the “Delayed  Amount”) on a date (the date of such funding, the “Delayed Funding Date”) that is on or before the thirty- fifth (35th) day following the date of such request for a Borrowing (or if such day is not a Business Day,  then on the next succeeding Business Day) rather than on the requested Borrowing date; provided, that in  no event shall the aggregate unfunded Delayed Amount at any time exceed 75% of the Series 2018-1  Class A Notes Maximum Principal Amount. By delivery of a Delayed Funding Notice, each Funding  Agent shall be deemed to represent and warrant that (x) charges relating to the “liquidity coverage ratio”  under Basel III have been incurred on the related Committed Note Purchaser’s interests or obligations  hereunder and (y) it is seeking or has obtained a delayed funding option in transactions similar to the  transactions contemplated hereby as of the date of such Delayed Funding Notice. A Funding Agent that  delivers a Delayed Funding Notice with respect to any Borrowing date shall be referred to herein as a  “Delaying Investor” with respect to such Borrowing date. If the conditions to any Borrowing described in  Section 7.03 are satisfied on the requested Borrowing date, there shall be no conditions whatsoever  (including, without limitation, the occurrence of an Early Amortization Event, notwithstanding any  statement to the contrary in Section 7.03) to the obligation of the Committed Note Purchasers to fund the  requested amount on the related Delayed Funding Date. On each Delayed Funding Date, the Delaying  Lender shall fund an aggregate amount equal to the Delayed Amount for such Delayed Funding Date;  provided that the Co-Issuers shall add additional Qualified Mortgaged Loans or Qualified Mortgaged  Properties on the related Delayed Funding Date to the extent necessary to cause the conditions precedent  set forth in Section 7.03 to be satisfied after giving effect to the addition of such additional Qualified  Mortgaged Loans or Qualified Mortgaged Properties.                SECTION 2.04     The Series 2018-1 Class A Notes. On each date an Advance is made,  and on each date the outstanding amount thereof is reduced, a duly authorized officer, employee or agent  of the related Series 2018-1 Class A Noteholder shall make appropriate notations in its books and records  of the amount, evidenced by the related Series 2018-1 Class A Note of such Advance and the amount of  such reduction, as applicable. The Co-Issuers hereby authorize each duly authorized officer, employee  and agent of such Series 2018-1 Class A Noteholder to make such notations on the books and records as  aforesaid and every such notation made in accordance with the foregoing authority shall be prima facie  evidence of the accuracy of the information so recorded; provided, however, that in the event of a  discrepancy between the books and records of such Series 2018-1 Class A Noteholder and the records  maintained by the Indenture Trustee pursuant to the Indenture and the Series 2018-1 Supplement, such  discrepancy shall be resolved among such Series 2018-1 Class A Noteholder and the Indenture Trustee, in  consultation with the Co-Issuers (provided that such consultation with the Co-Issuers will not in any way  limit or delay such Series 2018-1 Class A Noteholder’s and the Indenture Trustee’s ability to resolve such  discrepancy), and such resolution shall control in the absence of manifest error; provided further that the  failure of any such notation to be made, or any finding that a notation is incorrect, in any such records  shall not limit or otherwise affect the obligations of the Co-Issuers under this Agreement, the Indenture or  the Series 2018-1 Supplement.                SECTION 2.05     Reduction in Commitments.                                             16  DMSLIBRARY01\32647597  

 

                       (a)  The Co-Issuers may, upon at least three (3) Business Days’ notice to the  Administrative Agent (who shall promptly notify the Indenture Trustee, the Controlling Party and each  Funding Agent (which will promptly notify each related Investor), effect a permanent reduction in the  Series 2018-1 Class A Notes Maximum Principal Amount and a corresponding reduction in each  Commitment Amount and Maximum Investor Group Principal Amount on a pro rata basis according to  the Maximum Investor Group Principal Amount of each Investor Group; provided that (i) any such  reduction will be limited to the undrawn portion of the Commitments such that the Series 2018-1 Class A  Outstanding Principal Amount shall not exceed the Series 2018-1 Class A Notes Maximum Principal  Amount (after giving effect to any Voluntary Decrease effected pursuant to and in accordance with  Section 2.02(d) on such date), (ii) any such reduction must be in a minimum amount of $1,000,000, (iii)  after giving effect to such reduction, the Series 2018-1 Class A Notes Maximum Principal Amount equals  or exceeds $5,000,000, unless reduced to zero, and (iv) no such reduction shall be permitted if, after  giving effect thereto, the aggregate Commitment Amounts would be less than the Series 2018-1 Class A  Outstanding Principal Amount. Any reduction made pursuant to this Section 2.05(a) shall be made ratably  among the Investor Groups on the basis of their respective Maximum Investor Group Principal Amounts.                       (b)  If any of the following events shall occur, then the Commitment Amounts  shall be automatically reduced on the dates and in the amounts set forth below with respect to the  applicable event and the other consequences set forth below with respect to the applicable event shall  ensue (and the Co-Issuers shall give the Indenture Trustee, each Funding Agent and the Administrative  Agent prompt written notice thereof):                            (i)  if the Outstanding Principal Amount of the Series 2018-1 Class A         Notes has not been paid in full or otherwise refinanced in full (which refinancing may also         include an extension thereof) by the Business Day immediately preceding the Series 2018-1 Class         A Anticipated Repayment Date, (x) all undrawn portions of the Commitments shall automatically         and permanently terminate and the corresponding portions of the Series 2018-1 Class A Notes         Maximum Principal Amount and the Maximum Investor Group Principal Amounts shall be         automatically and permanently reduced by a corresponding amount (with respect to the         Maximum Investor Group Principal Amounts, on a pro rata basis) and (y) each payment of         principal on the Series 2018-1 Class A Outstanding Principal Amount occurring on or following         such Business Day shall result automatically in a dollar-for-dollar reduction of the Series 2018-1         Class A Notes Maximum Principal Amount and a corresponding reduction in each Maximum         Investor Group Principal Amount on a pro rata basis;                            (ii)  if an Early Amortization Event has occurred and is continuing prior        to the Series 2018-1 Class A Anticipated Repayment Date, then (A) on the date such Early        Amortization Event occurs, (x) all undrawn portions of the Commitments shall automatically be        reduced to zero for so long as such Early Amortization Event has occurred and is continuing, and        the corresponding portions of the Series 2018-1 Class A Notes Maximum Principal Amount and        the Maximum Investor Group Principal Amounts shall be automatically reduced by a        corresponding amount (with respect to the Maximum Investor Group Principal Amounts, on a pro        rata basis) and (B) each payment of principal on the Series 2018-1 Class A Outstanding Principal        Amount occurring on or after the date on which such Early Amortization Event has occurred and        is continuing shall result automatically in a dollar-for-dollar reduction of the Series 2018-1 Class        A Notes Maximum Principal Amount and a corresponding reduction in each Maximum Investor        Group Principal Amount on a pro rata basis; provided, that if the Early Amortization Event is no        longer continuing, the Commitments, Series 2018-1 Class A Notes Maximum Principal Amount        and the Maximum Investor Group Principal Amount shall be restored to the full extent reduced        pursuant to this subclause (ii) except to the extent voluntarily reduced by the Co-Issuers pursuant        to Section 2.05(a); and                                             17  DMSLIBRARY01\32647597  

 

                          (iii)  if any Event of Default shall occur and be continuing (and shall not        have been waived in accordance with the Indenture), the Series 2018-1 Class A Notes Maximum        Principal Amount, the Commitment Amounts and the Maximum Investor Group Principal        Amounts shall all be automatically and permanently reduced to zero for so long as such Event of        Default has occurred and is continuing and the Co-Issuers shall (in accordance with the        Indenture) cause the Series 2018-1 Class A Outstanding Principal Amount to be paid in full        together with accrued interest, accrued Series 2018-1 Class A Undrawn Commitment Fees, Series        2018-1 Class A Notes Other Amounts and all other amounts then due and payable to the        Investors, the Administrative Agent and the Funding Agents under this Agreement and the other        Transaction Documents, in each case subject to and in accordance with the provisions of the        Indenture, including the Priority of Payments.                                         ARTICLE III                                   INTEREST AND FEES                SECTION 3.01     Interest.                       (a)  To the extent that an Advance is funded or maintained by a Conduit  Investor through the issuance of Commercial Paper, such Advance shall bear interest at the weighted  average daily CP Rate applicable to such Conduit Investor for each applicable Interest Accrual Period.   To the extent that, and only for so long as, an Advance is funded or maintained by a Conduit Investor  through means other than the issuance of Commercial Paper (based on its determination in good faith that  it is unable to raise or is precluded or prohibited from raising, or that it is not advisable to raise, funds  through the issuance of Commercial Paper in the commercial paper market of the United States to finance  its purchase or maintenance of such Advance or any portion thereof (which determination may be based  on any allocation method employed in good faith by such Conduit Investor), including by reason of  market conditions or by reason of insufficient availability under any of its Program Support Agreement or  the downgrading of any of its Program Support Providers), such Advance shall bear interest at (i) the  Base Rate or (ii) if the required notice has been given pursuant to Section 3.01(b) with respect to such  Advance, for any Eurodollar Interest Accrual Period, the Eurodollar Rate applicable to such Eurodollar  Interest Accrual Period for such Advance, in each case except as otherwise provided in the definition of  Eurodollar Interest Accrual Period or in Section 3.03 or 3.04.  Each Advance funded or maintained by a  Committed Note Purchaser or a Program Support Provider shall bear interest at (i) the Base Rate or (ii) if  the required notice has been given pursuant to Section 3.01(b) with respect to such Advance, for any  Eurodollar Interest Accrual Period, the Eurodollar Rate applicable to such Eurodollar Interest Accrual  Period for such Advance, in each case except as otherwise provided in the definition of Eurodollar  Interest Accrual Period or in Section 3.03 or 3.04. By 11:00 a.m. (New York City time) on the third  Business Day preceding each Payment Date, each Funding Agent shall notify each of the Administrative  Agent, the Property Manager and the Co-Issuers in writing of the applicable weighted average daily CP  Rate and the amount of interest accrued for each Advance made by its Investor Group that was funded or  maintained through the issuance of Commercial Paper and was outstanding during all or any portion of  the Interest Accrual Period ending immediately prior to such Payment Date and of the applicable interest  rate for each other Advance for such Interest Accrual Period and of the amount of interest accrued on  each other Advance during such Interest Accrual Period.                       (b)  With respect to any Advance (other than one funded or maintained by a  Conduit Investor through the issuance of Commercial Paper), so long as no Early Amortization Event,  Default or Event of Default has commenced and is continuing, the Co-Issuers may elect that such  Advance bear interest at the Eurodollar Rate for any Eurodollar Interest Accrual Period (which shall be a  period with a term of, at the election of the Co-Issuers subject to the proviso in the definition of  Eurodollar Interest Accrual Period, one month, two months, three months or six months while such                                             18  DMSLIBRARY01\32647597  

 

   Advance is outstanding to the extent provided in Section 3.01(a) by giving notice thereof (including  notice of the Co-Issuers’ selection of the term for the applicable Eurodollar Interest Accrual Period) to  each Funding Agent prior to 12:00 p.m. (New York City time) on the date which is two (2) Eurodollar  Business Days prior to the commencement of such Eurodollar Interest Accrual Period. If such notice is  not given in a timely manner, such Advance shall bear interest at the Base Rate. Each such conversion to  or continuation of Eurodollar Advances for a new Eurodollar Interest Accrual Period in accordance with  this Section 3.01(b) shall be in an aggregate principal amount of $500,000 or an integral multiple of  $100,000 in excess thereof.                        (c)  [Reserved]                       (d)  All accrued interest pursuant to Section 3.01(a) shall be due and payable in  arrears on each Payment Date in accordance with the applicable provisions of the Indenture.                       (e)  Following the Series 2018-1 Class A Anticipated Repayment Date, the Co- Issuers shall pay additional interest in respect of the Series 2018-1 Class A Outstanding Principal Amount  in an amount equal to the Series 2018-1 Class A Post-ARD Additional Interest payable pursuant to  Section 2.11 of the Indenture subject to and in accordance with the Priority of Payments.                       (f)  All computations of interest at the CP Rate and the Eurodollar Rate, all  computations of Series 2018-1 Class A Post-ARD Additional Interest (other than any accruing on any  Base Rate Advances) and all computations of fees shall be made on the basis of a year of 360 days and  the actual number of days elapsed.  All computations of interest at the Base Rate and all computations of  Series 2018-1 Class A Post-ARD Additional Interest accruing on any Base Rate Advances shall be made  on the basis of a 360-day year and actual number of days elapsed.  Whenever any payment of interest,  principal or fees hereunder shall be due on a day other than a Business Day, such payment shall be made  on the next succeeding Business Day unless specified otherwise in the Indenture and such extension of  time shall be included in the computation of the amount of interest owed.  Interest shall accrue on each  Advance from and including the day on which it is made to but excluding the date of repayment thereof.                       (g)  For purposes of the Series 2018-1 Class A Notes, “Interest Accrual  Period” means a period commencing on and including the day that is four (4) Business Days prior to a  Payment Date (or, with respect to the initial period following the Series 2018-1 Closing Date, the Series  2018-1 Closing Date) and ending on but excluding the day that is four (4) Business Days prior to the next  succeeding Payment Date.                SECTION 3.02     Fees.                       (a)  The Co-Issuers shall pay the Administrative Agent for its own account the  Administrative Agent Fees (as defined in the Series 2018-1 Class A Notes Fee Letter, collectively, the  “Administrative Agent Fees”) in accordance with the terms of the Series 2018-1 Class A Notes Fee Letter  and subject to and in accordance with the Priority of Payments.                       (b)  On each Payment Date on or prior to the Commitment Termination Date,  the Co-Issuers shall, in accordance with Section 4.01, pay to each Funding Agent, for the account of the  related Committed Note Purchaser(s), an undrawn commitment fee calculated daily on the undrawn  portion of the Commitments (the “Series 2018-1 Class A Undrawn Commitment Fees”) in accordance  with the terms of the Series 2018-1 Class A Notes Fee Letter and subject to and in accordance with the  Priority of Payments.  The Series 2018-1 Class A Undrawn Commitment Fee will be calculated on an  Actual/360 Basis. The Series 2018-1 Class A Undrawn Commitment Fees shall be VFN Undrawn  Commitment Fees for all purposes under the Indenture and the Series 2018-1 Supplement.                                             19  DMSLIBRARY01\32647597  

 

                       (c)  The Co-Issuers shall pay any fees set forth in the Series 2018-1 Class A  Notes Fee Letter (including, without limitation, the Series 2018-1 Class A Notes Upfront Fee) subject to  and in accordance with the Priority of Payments (other than the Series 2018-1 Class A Notes Upfront Fee  which shall be paid by the Co-Issuers on the Series 2018-1 Closing Date).                          (d)  All fees payable pursuant to this Section 3.02 shall be calculated in  accordance with Section 3.01(f) and paid on the Payment Date due in accordance with the applicable  provisions of the Indenture.  Once paid, all fees payable hereunder shall be nonrefundable under all  circumstances other than manifest error.                 SECTION 3.03     Eurodollar Lending Unlawful. If any Investor or Program Support  Provider shall determine that any Change in Law makes it unlawful, or any Official Body asserts that it is  unlawful, for any such Person to fund or maintain any Advance as a Eurodollar Advance, the obligation  of such Person to fund or maintain any such Advance as a Eurodollar Advance shall, upon such  determination, forthwith be suspended until such Person shall notify the Administrative Agent, the related  Funding Agent and the Co-Issuers that the circumstances causing such suspension no longer exist, and all  then-outstanding Eurodollar Advances of such Person shall be automatically converted into Base Rate  Advances at the end of the then-current Eurodollar Interest Accrual Period with respect thereto or sooner,  if required by such law or assertion.                 SECTION 3.04     Deposits Unavailable; Alternate Rate of Interest.                        (a)  If the Administrative Agent shall have reasonably determined that:                            (i)  by reason of circumstances affecting the any Committed Note         Purchaser’s relevant market, adequate and reasonable means do not exist for ascertaining the         interest rate applicable hereunder to the Eurodollar Advances; or                           (ii)  with respect to any interest rate otherwise applicable hereunder to        any Eurodollar Advances the Eurodollar Interest Accrual Period for which has not then        commenced, Investor Groups holding in the aggregate more than 50% of the Eurodollar        Advances have determined that such interest rate will not adequately reflect the cost to them of        funding, agreeing to fund or maintaining such Eurodollar Advances for such Eurodollar Interest        Accrual Period,   then, upon notice from the Administrative Agent (which, in the case of clause (ii) above, the  Administrative Agent shall give upon obtaining actual knowledge that such percentage of the Investor  Groups have so determined) to the Funding Agents and the Co-Issuers, the obligations of the Investors to  fund or maintain any Advance as a Eurodollar Advance after the end of the then-current Eurodollar  Interest Accrual Period, if any, with respect thereto shall forthwith be suspended and on the date such  notice is given such Advances will convert to Base Rate Advances until the Administrative Agent has  notified the Funding Agents and the Co-Issuers that the circumstances causing such suspension no longer  exist.                       (b)  If at any time the Administrative Agent determines (which determination  shall be conclusive absent manifest error) that (i) the circumstances set forth in Section 3.04(a) have  arisen and such circumstances are unlikely to be temporary or (ii) the circumstances set forth in Section  3.04(a) have not arisen but the supervisor for the administrator of the London interbank offered rate  administered by ICE Benchmark Administration Limited or any other Person that takes over the  administration of such rate for U.S. dollars (such page currently being the LIBOR01 page) or a  Governmental Authority having jurisdiction over the Administrative Agent has made a public statement                                             20  DMSLIBRARY01\32647597  

 

   identifying a specific date after which such London interbank offered rate shall no longer be used for  determining interest rates for loans, then the Administrative Agent and the Co-Issuers shall endeavor to  establish an alternate rate of interest to such London interbank offered rate to be applied in determining  the Eurodollar Funding Rate that gives due consideration to the then prevailing market convention for  determining a rate of interest for syndicated loans in the United States at such time, and shall enter into an  amendment to this Agreement including, without limitation, to the definition of “Eurodollar Funding  Rate” set forth herein, to reflect such alternate rate of interest and such other related changes to this  Agreement as may be applicable; provided, that if such alternate rate of interest shall be less than zero,  such rate shall be deemed to be zero for the purposes of this Agreement.  Notwithstanding anything to the  contrary in Section 9.01, such amendment shall become effective without any further action or consent of  any other party to this Agreement so long as the Administrative Agent shall not have received, within five  (5) Business Days of the date notice of such alternate rate of interest is provided to the Investor Groups,  written notice from Investor Groups holding more than (i) if no single Investor Group holds more than  50% of the Commitments, 50% of the Commitments or (ii) if a single Investor Group holds more than  50% of the Commitments, two-thirds of the Commitments, stating that such Investor Groups reasonably  object to such amendment.                 SECTION 3.05     Increased Costs, etc. The Co-Issuers agree to reimburse each  Investor and any Program Support Provider (each, an “Affected Person”) for any increase in the cost of,  or any reduction in the amount of any sum receivable by any such Affected Person, including reductions  in the rate of return on such Affected Person’s capital, in respect of funding or maintaining (or of its  obligation to fund or maintain) any Advances that arise in connection with any Change in Law which  shall:                             (i)  impose, modify or deem applicable any reserve, special deposit or         similar requirement against assets of, deposits with or for the account of, or credit extended by,         any Affected Person (except any such reserve requirement reflected in the Eurodollar Rate); or                           (ii)  impose on any Affected Person or the London interbank market any        other condition affecting this Agreement or Eurodollar Advances made by such Affected Person;   except for such Changes in Law with respect to increased capital costs and Class A Taxes which shall be  governed by Sections 3.07 and 3.08, respectively (whether or not amounts are payable thereunder in  respect thereof).  Each such demand shall be provided to the related Funding Agent and the Co-Issuers in  writing and shall state, in reasonable detail, the reasons therefor and the additional amount required fully  to compensate such Affected Person for such increased cost or reduced amount of return; provided that  any such demand claiming reimbursement for increased costs resulting from a Change in Law described  in clause (i) or (ii) above shall, in addition, state the basis upon which such amount has been calculated  and certify that such Affected Person’s method of allocating such costs is fair and reasonable and that  such Affected Person’s demand for payment of such costs hereunder, and such method of allocation, is  consistent with, or more favorable than, its treatment of other borrowers which, as a credit matter, are  substantially similar to the Co-Issuers and which are subject to similar provisions. Such additional  amounts (“Increased Costs”) shall be paid by the Co-Issuers to the Administrative Agent as Series 2018-1  Class A Notes Other Amounts, subject to and in accordance with the Priority of Payments, on the  Payment Date following the Collection Period in which such written notice is received, and by the  Administrative Agent to such Funding Agent pursuant to written direction and by such Funding Agent  directly to such Affected Person, and such notice shall, in the absence of manifest error, be conclusive and  binding on the Co-Issuers; provided that with respect to any notice given to the Co-Issuers under this  Section 3.05 the Co-Issuers shall not be under any obligation to pay any amount with respect to any  period prior to the date that is nine (9) months prior to such demand; provided further that if the Change                                              21  DMSLIBRARY01\32647597  

 

   in Law giving rise to such Increased Costs is retroactive, then the nine-month period referred to above  shall be extended to include the period of retroactive effect thereof.                       (b)  For purposes of this Agreement, including, without limitation, this Section  3.05 and Section 3.07,  (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all  regulations, requests, guidelines or directives issued in connection therewith and (y) all requests, rules,  guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on  Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory  authorities, in each case, pursuant to Basel III, are deemed to have gone into effect and been adopted  subsequent to the date hereof.                SECTION 3.06     Funding Losses.  In the event any Affected Person shall incur any  loss or expense (including any loss or expense incurred by reason of the liquidation or reemployment of  deposits or other funds acquired by such Affected Person to fund or maintain any portion of the principal  amount of any Advance as a Eurodollar Advance) as a result of:                       (a)  any conversion, repayment, prepayment or redemption (for any reason,  including, without limitation, as a result of any Voluntary Decrease or the acceleration of the maturity of  such Eurodollar Advance) of the principal amount of any Eurodollar Advance on a date other than the  scheduled last day of the Eurodollar Interest Accrual Period applicable thereto;                       (b)  any Advance not being funded or maintained as a Eurodollar Advance  after a request therefor has been made in accordance with the terms contained herein (for a reason other  than the failure of such Affected Person to make an Advance after all conditions thereto have been met);  or                       (c)  any failure of the Co-Issuers to make a Voluntary Decrease, prepayment or  redemption with respect to any Eurodollar Advance after giving notice thereof pursuant to the applicable  provisions of the Indenture;   then, upon the written notice (which shall include calculations in reasonable detail) of any Affected  Person to the related Funding Agent and the Co-Issuers, the Co-Issuers shall pay to the Administrative  Agent, in the form of Series 2018-1 Class A Notes Other Amounts, subject to and in accordance with the  Priority of Payments on the Payment Date following the Collection Period in which such written notice is  received, and by the Administrative Agent to such Funding Agent pursuant to written direction and such  Funding Agent shall pay directly to such Affected Person such amount (“Breakage Amount” or “Series  2018-1 Class A Breakage Amount”) as will (in the reasonable determination of such Affected Person)  reimburse such Affected Person for such loss or expense.  With respect to any notice given to the Co- Issuers under this Section 3.06 the Co-Issuers shall not be under any obligation to pay any amount with  respect to any period prior to the date that is nine (9) months prior to such notice. Such written notice  (which shall include calculations in reasonable detail) shall, in the absence of manifest error, be  conclusive and binding on the Co-Issuers.                SECTION 3.07     Increased Capital or Liquidity Costs. If any Change in Law affects or  would affect the amount of capital or liquidity required or reasonably expected to be maintained by any  Affected Person or any Person controlling such Affected Person and such Affected Person reasonably  determines, in its sole discretion, that the rate of return on its or such controlling Person’s capital as a  consequence of its commitment hereunder or under a Program Support Agreement or the Advances made  or issued by such Affected Person is reduced to a level below that which such Affected Person or such  controlling Person would have achieved but for the occurrence of any such circumstance, then, in any  such case after notice from time to time by such Affected Person to the related Funding Agent and the                                             22  DMSLIBRARY01\32647597  

 

   Co-Issuers, the Co-Issuers shall pay to the Administrative Agent, in the form of Series 2018-1 Class A  Notes Other Amounts, subject to and in accordance with the Priority of Payments, on the Payment Date  following the Collection Period in which the Co-Issuers receives such written notice, and by the  Administrative Agent pursuant to written direction to such Funding Agent and such Funding Agent shall  pay to such Affected Person, such amounts (“Increased Capital Costs”) as will be sufficient to  compensate such Affected Person or such controlling Person for such reduction in rate of return on its or  such Controlling Person’s capital as a consequence of its commitment hereunder or under a Program  Support Agreement or the Advances made or issued by such Affected Person; provided that with respect  to any notice given to the Co-Issuers under this Section 3.07 the Co-Issuers shall not be under any  obligation to pay any amount with respect to any period prior to the date that is nine (9) months prior to  such notice; provided, further, if the Change in Law giving rise to such Increased Capital Costs is  retroactive, then the nine-month period referred to above shall be extended to include the period of  retroactive effect thereof). A statement of such Affected Person as to any such additional amount or  amounts (including calculations thereof in reasonable detail), in the absence of manifest error, shall be  conclusive and binding on the Co-Issuers. In determining such additional amount, such Affected Person  may use any method of averaging and attribution that it (in its reasonable discretion) shall deem  applicable so long as it applies such method to other similar transactions.                  SECTION 3.08     Taxes.                        (a)  Except as otherwise required by law, all payments by the Co-Issuers of  principal of, and interest on, the Advances and all other amounts payable hereunder (including fees) shall  be made free and clear of and without deduction or withholding for or on account of any present or future  income, excise, documentary, property, stamp or franchise taxes and other taxes, fees, duties,  withholdings or other charges in the nature of a tax imposed by any taxing authority including all interest,  penalties or additions to tax and other liabilities with respect thereto (all such taxes, fees, duties,  withholdings and other charges, and including all interest, penalties or additions to tax and other liabilities  with respect thereto, being called “Class A Taxes”), but excluding in the case of any Affected Person (i)  net income, franchise (imposed in lieu of net income) or similar taxes (and including branch profits or  alternative minimum taxes) and any other Class A Taxes imposed or levied on the Affected Person as a  result of a present or former connection between the Affected Person and the jurisdiction of the  governmental authority imposing such Class A Taxes (or any political subdivision or taxing authority  thereof or therein) (other than any such connection arising solely from such Affected Person having  executed, delivered or performed its obligations or received a payment under, or enforced, this Agreement  or any other Transaction Document), (ii) any withholding tax that is imposed on amounts payable to the  Affected Person at the time the Affected Person becomes a party to this Agreement (or designates a new  lending office), except to the extent that such Affected Person (or its assignor, if any) was already  entitled, at the time of the designation of the new lending office (or assignment), to receive additional  amounts from the Co-Issuers with respect to such withholding tax pursuant to this Section 3.08, (iii) any  taxes imposed under FATCA, (iv) any backup withholding tax and (v) any Class A Taxes imposed as a  result of such Affected Person’s failure to comply with Section 3.08(d) (such Class A Taxes not excluded  by (i), (ii), (iii), (iv) and (v) above being called “Non-Excluded Taxes”). If any Class A Taxes are  imposed and required by law to be withheld or deducted from any amount payable by the Co-Issuers  hereunder to an Affected Person, then, (x) the Co-Issuers shall withhold the amount of such Class A  Taxes from such payment (as increased, if applicable, pursuant to the following clause (y)) and shall pay  such amount, subject to and in accordance with the Priority of Payments, to the taxing authority imposing  such Class A Taxes in accordance with applicable law and (y) if such Class A Taxes are Non-Excluded  Taxes, the amount of the payment shall be increased so that such payment is made, after withholding or  deduction for or on account of such Non-Excluded Taxes, in an amount that is equal to the sum that  would have been received by the Affected Person had no such deduction or withholding been required.                                             23  DMSLIBRARY01\32647597  

 

                       (b)  Moreover, if any Non-Excluded Taxes are directly asserted against any  Affected Person with respect to any payment received by such Affected Person from the Co-Issuers or  otherwise in respect of any Transaction Document or the transactions contemplated therein, such Affected  Person may pay such Non-Excluded Taxes and the Co-Issuers shall pay to the Administrative Agent, in  the form of Series 2018-1 Class A Notes Other Amounts, subject to and in accordance with the Priority of  Payments, on the Payment Date following the Collection Period in which the related Funding Agent and  the Co-Issuers receive written notice stating the amount of such Non-Excluded Taxes (including the  calculation thereof in reasonable detail), which the Administrative Agent shall then pay, pursuant to  written direction, to such Funding Agent, who shall then pay directly to such Affected Persons such  additional amounts (collectively, “Increased Tax Costs,” which term shall include all amounts payable by  or on behalf of the Co-Issuers pursuant to this Section 3.08) as is necessary in order that the net amount  received by such Affected Person after the payment of such Non-Excluded Taxes (including any Non- Excluded Taxes on such Increased Tax Costs) shall equal the amount such Person would have retained  had no such Non-Excluded Taxes been asserted. Any amount payable to an Affected Person under this  Section 3.08 shall be reduced by, and Increased Tax Costs shall not include, the amount of incremental  damages (including Class A Taxes) due or payable by the Co-Issuers as a direct result of such Affected  Person’s failure to demand from the Co-Issuers additional amounts pursuant to this Section 3.08 within  180 days from the date on which the related Non-Excluded Taxes were incurred.                       (c)  As promptly as practicable after the payment of any Class A Taxes by the  Co-Issuer, and in any event within thirty (30) days of any such payment being due, the Co-Issuers shall  furnish to each applicable Affected Person or its agents a certified copy of an official receipt (or other  documentary evidence reasonably satisfactory to such Affected Person and agents) evidencing the  payment of such Class A Taxes to the extent the Co-Issuers are responsible for the payment of such Class  A Taxes.  If the Co-Issuers, when required to do so in accordance with applicable law, fail to pay any  Class A Taxes when due to the appropriate taxing authority or fail to remit to the Affected Persons or  their agents the required receipts (or such other documentary evidence), the Co-Issuers shall indemnify  (by depositing such amounts into the Collection Account, to be distributed subject to and in accordance  with the Priority of Payments) each Affected Person and its agents for any Non-Excluded Taxes (for the  avoidance of doubt, without duplication for any amounts payable under Section 3.08(b)) that any such  Affected Person or its agents actually pays to a taxing authority as a result of any such failure.                       (d)    Each Affected Person and Funding Agent on or prior to the date it  becomes a party to this Agreement or within a reasonable period of time (and in any event within thirty  (30) days) following a written request by a Co-Issuer or the Administrative Agent, shall deliver to the Co- Issuers and the Administrative Agent a duly executed copy of United States Internal Revenue Service  Form W-8BEN, Form W-8BEN-E, Form W-8ECI, Form W-8IMY or Form W-9, as applicable, or  applicable successor form (together with all required attachments), or such other forms or documents (or  successor forms or documents), appropriately completed and executed, as may be applicable and as will  permit the Co-Issuers or the Administrative Agent, in their reasonable determination, to establish the  extent to which a payment to such Affected Person is exempt from or eligible for a reduced rate of  withholding or deduction of United States federal withholding taxes, including but not limited to such  information necessary to claim the benefits of the exemption for portfolio interest under Section 881(c) of  the Code, and to determine whether or not such Affected Person or Funding Agent is subject to backup  withholding or information reporting requirements.  Without limiting the foregoing, promptly following  the receipt of a written request by the Co-Issuers or the Administrative Agent, each Affected Person and  Funding Agent shall deliver to the Co-Issuers and the Administrative Agent any other forms or  documents (or successor forms or documents) appropriately completed and executed, as may be  applicable to establish the extent to which a payment to such Affected Person or Funding Agent is exempt  from withholding or deduction of Non-Excluded Taxes other than United States federal withholding  taxes.  The Co-Issuers shall not be required to pay any increased amount under Section 3.08(a) or Section                                             24  DMSLIBRARY01\32647597  

 

   3.08(b) to an Affected Person in respect of the withholding or deduction of United States federal  withholding taxes or other Non-Excluded Taxes imposed as the result of the failure or inability (other  than as a result of a Change in Law) of such Affected Person to comply with the requirements set forth in  this Section 3.08(d). The Co-Issuers and the Administrative Agent (or other withholding agent selected by  the Co-Issuers) may rely on any form or document provided pursuant to this Section 3.08(d) until notified  otherwise by the Affected Person or the Funding Agent that delivered such form or document.  Notwithstanding anything to the contrary, no Affected Person or Funding Agent shall be required to  deliver any documentation that it is not legally eligible to deliver as a result of a change in applicable law  after the time the Affected Person or Funding Agent becomes a party to this Agreement (or designates a  new lending office).                             (e)  If a payment made to an Affected Person or Funding Agent pursuant to  this Agreement would be subject to United States federal withholding tax imposed by FATCA if such  Affected Person or Funding Agent were to fail to comply with the applicable reporting requirements of  FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such  Affected Person or Funding Agent shall deliver to the Co-Issuers and the Administrative Agent at the  time or times prescribed by law and at such time or times reasonably requested by the Co-Issuers or the  Administrative Agent such documentation prescribed by applicable law (including as prescribed by  Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Co- Issuers or the Administrative Agent as may be necessary for the Co-Issuers and the Administrative Agent  to comply with its obligations under FATCA and to determine that such Affected Person or Funding  Agent has complied with such Affected Person’s or Funding Agent’s obligations under FATCA or to  determine the amount to deduct and withhold from such payment.  Solely for purposes of this clause (e),  “FATCA” shall include any amendments made to FATCA after the date of this Agreement.                        (f)  Each Affected Person and Funding Agent agrees that if any form or  certification it previously delivered in accordance with paragraphs (d) or (e) above expires or becomes  obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify the Co- Issuers and the Administrative Agent in writing of its legal inability to do so.                       (g)  Prior to the Series 2018-1 Closing Date, the Administrative Agent will  provide the Co-Issuers with either (i) a properly executed and completed U.S. Internal Revenue Service  Form W-9, or (ii) (A) with respect to any amounts payable to the Administrative Agent for its own  account, a properly executed and completed U.S. Internal Revenue Service Form W-8ECI, and (B) with  respect to all other amounts, a properly executed and completed U.S. Internal Revenue Service Form W- 8IMY certifying that it is a U.S. branch and that it is using such form as evidence of its agreement with  the Co-Borrowers to be treated as a United States person with respect to such payments.                       (h)  If an Affected Person determines, in its sole reasonable discretion, that it  has received a refund of any Non-Excluded Taxes as to which it has been indemnified pursuant to this  Section 3.08 or as to which it has been paid additional amounts pursuant to this Section 3.08, it shall  promptly notify the Co-Issuers in writing of such refund and shall pay over such refund to the Co-Issuers  (but only to the extent of indemnity payments made or additional amounts paid to such Affected Person  under this Section 3.08 with respect to the Non-Excluded Taxes giving rise to such refund), net of all out- of-pocket expenses (including the net amount of Class A Taxes, if any, imposed on or with respect to  such refund or payment) of the Affected Person and without interest (other than any interest paid by the  relevant taxing authority that is directly attributable to such refund of such Non-Excluded Taxes);  provided that the Co-Issuers, immediately upon the request of the Affected Person to the Co-Issuers  (which request shall include a calculation in reasonable detail of the amount to be repaid), agrees to repay  the amount of the refund (and any applicable interest) (plus any penalties, interest or other charges  imposed by the relevant taxing authority with respect to such amount) to the Affected Person in the event                                             25  DMSLIBRARY01\32647597  

 

   the Affected Person is required to repay such refund to such taxing authority. This Section 3.08(g) shall  not be construed to require the Affected Person to make available its tax returns (or any other information  relating to its Class A Taxes that it deems confidential) to the Co-Issuers or any other Person.                       (i)  If any Governmental Authority asserts that the Co-Issuers or the  Administrative Agent or other withholding agent did not properly withhold or backup withhold, as the  case may be, any Class A Taxes from payments made to or for the account of any Affected Person, then  to the extent such improper withholding or backup withholding was directly caused by such Affected  Person’s actions or inactions, such Affected Person shall indemnify the Co-Issuers, the Indenture Trustee  and the Administrative Agent for any Class A Taxes imposed by any jurisdiction as a result of such  actions or inactions, and costs and expenses (including attorney costs) of the Co-Issuers, the Indenture  Trustee and the Administrative Agent. The obligation of the Affected Persons, severally, under this  Section 3.08 shall survive any assignment of rights by, or the replacement of, an Affected Person or the  termination of the aggregate Commitments, repayment of all other obligations hereunder and the  resignation of the Administrative Agent.                       (j)  The Administrative Agent, the Indenture Trustee, the Co-Issuers or any  other withholding agent may deduct and withhold any Class A Taxes required by any laws to be deducted  and withheld from any payments.                 SECTION 3.09     Change of Lending Office. Each Committed Note Purchaser agrees  that, upon the occurrence of any event giving rise to the operation of Section 3.05 or 3.07 or the payment  of additional amounts to it under Section 3.08(a) or (b), in each case with respect to an Affected Person in  such Committed Note Purchaser’s Investor Group, it will, if requested by the Co-Issuers, use reasonable  efforts (subject to overall policy considerations of such Committed Note Purchaser) to designate, or cause  the designation of, another lending office for any Advances affected by such event with the object of  avoiding the consequences of such event; provided that such designation is made on terms that, in the sole  judgment of such Committed Note Purchaser, cause such Committed Note Purchaser and its lending  office(s) or the related Affected Person to suffer no economic, legal or regulatory disadvantage; and  provided, further, that nothing in this Section 3.09 shall affect or postpone any of the obligations of the  Co-Issuers or the rights of any Committed Note Purchaser pursuant to Section 3.05, 3.07 and 3.08. If a  Committed Note Purchaser notifies the Co-Issuers in writing that such Committed Note Purchaser will be  unable to designate, or cause the designation of, another lending office, the Co-Issuers may replace every  member (but not any subset thereof) of such Committed Note Purchaser’s entire Investor Group by giving  written notice to each member of such Investor Group and the Administrative Agent designating one or  more Persons that are willing and able to purchase each member of such Investor Group’s rights and  obligations under this Agreement for a purchase price that with respect to each such member of such  Investor Group will equal the amount owed to each such member of such Investor Group with respect to  the Series 2018-1 Class A Notes (whether arising under the Indenture, this Agreement, the Series 2018-1  Class A Notes or otherwise). Upon receipt of such written notice, each member of such Investor Group  shall assign its rights and obligations under this Agreement pursuant to and in accordance with Sections  9.17(a), (b) and (c), as applicable, in consideration for such purchase price and at the reasonable expense  of the Co-Issuers (including, without limitation, the reasonable documented fees and out-of-pocket  expenses of counsel to each such member); provided, however, that no member of such Investor Group  shall be obligated to assign any of its rights and obligations under this Agreement if the purchase price to  be paid to such member is not at least equal to the amount owed to such member with respect to the  Series 2018-1 Class A Notes (whether arising under the Indenture, this Agreement, the Series 2018-1  Class A Notes or otherwise).                                              26  DMSLIBRARY01\32647597  

 

                                         ARTICLE IV                                 OTHER PAYMENT TERMS                SECTION 4.01     Time and Method of Payment (Amounts Distributed by the  Administrative Agent). Except as otherwise provided in Section 4.02, all amounts payable to any Funding  Agent or Investor hereunder or with respect to the Series 2018-1 Class A Notes shall be made by the Co- Issuers pursuant to written direction or the Determination Date Report to the Administrative Agent for the  benefit of the applicable Person, by wire transfer of immediately available funds in Dollars not later than  1:00 p.m. (New York City time) on the date due.  The Administrative Agent will promptly, and in any  event no later than 5:00 p.m. (New York City time) on the second Business Day following its receipt or  deemed receipt of the same, distribute to the applicable Funding Agent for the benefit of the applicable  Person, or upon the order of the applicable Funding Agent for the benefit of the applicable Person, in each  case pursuant to written direction, in an amount equal to its pro rata share (or other applicable share as  provided herein) of such payment by wire transfer in like funds as received.  The Co-Issuers’ obligations  hereunder in respect of any amounts payable to any Investor shall be discharged to the extent funds are  disbursed by any Co-Issuer to the Administrative Agent as provided herein or by the Indenture Trustee in  accordance with Section 4.02 whether or not such funds are properly applied by the Administrative Agent  or by the Indenture Trustee. The Administrative Agent’s obligations hereunder in respect of any amounts  payable to any Investor shall be discharged to the extent funds are disbursed by the Administrative Agent  to the applicable Funding Agent as provided herein whether or not such funds are properly applied by  such Funding Agent.                SECTION 4.02     Order of Distributions (Amounts Distributed by the Indenture  Trustee).  Subject to the application of Section 9.18(c)(ii) to Defaulting Investors, any amounts deposited  into the Debt Service Sub-Account in respect of accrued interest or undrawn commitment fees, but  excluding amounts allocated for the purpose of reducing the Series 2018-1 Class A Outstanding Principal  Amount, shall be distributed by the Indenture Trustee under the Indenture on the date due and payable  under the Indenture and in the manner provided therein, to the Series 2018-1 Class A Noteholders of  record on the applicable Record Date, ratably in proportion to the respective amounts due to such payees  at each applicable level of the Priority of Payments in accordance with the applicable Determination Date  Report.                Subject to the application of Section 9.18(c)(ii) to Defaulting Investors, any amounts  deposited into the Series Account for the Series 2018-1 Class A Notes for the purpose of reducing the  Series 2018-1 Class A Outstanding Principal Amount shall be distributed by the Indenture Trustee under  the Indenture on the date due and payable under the Indenture and in the manner provided therein, to the  Series 2018-1 Class A Noteholders of record on the applicable Record Date, to the Series 2018-1 Class A  Noteholders in respect of their outstanding Advances, ratably in proportion thereto.                 Any amounts distributed to the Administrative Agent for disbursement to the applicable  Funding Agent as provided herein pursuant to the Priority of Payments in respect of any other amounts  related to the Class A Notes shall be distributed by the Administrative Agent in accordance with Section  4.01 on the date such amounts are due and payable hereunder to the applicable Series 2018-1 Class A  Noteholders and/or the Administrative Agent for its own account, as applicable, ratably in proportion to  the respective aggregate of such amounts due to such payees.                 (ii)   At all times on and after the Commitment Termination Date, principal payments  shall be due and payable on the Series 2018-1 Class A Notes as and when amounts are made available for  payment thereof on each Payment Date during such period in accordance with Section 2.11 of the  Indenture, in the amount so made available.  Such payments shall be allocated among the Series 2018-1                                              27  DMSLIBRARY01\32647597  

 

   Class A Noteholders, in accordance with the order of distribution of principal payments set forth in this  Section 4.02.                                         ARTICLE V                 THE ADMINISTRATIVE AGENT AND THE FUNDING AGENTS                SECTION 5.01     Authorization and Action of the Administrative Agent. Each of the  Investors and the Funding Agents hereby designates and appoints Barclays Bank PLC, as Administrative  Agent hereunder, and hereby authorizes the Administrative Agent to take such actions as agent on their  behalf and to exercise such powers as are delegated to the Administrative Agent by the terms of this  Agreement together with such powers as are reasonably incidental thereto. The Administrative Agent  shall not have any duties or responsibilities, except those expressly set forth herein, or any fiduciary  relationship with any Investor or any Funding Agent, and no implied covenants, functions,  responsibilities, duties, obligations or liabilities on the part of the Administrative Agent shall be read into  this Agreement or otherwise exist for the Administrative Agent. In performing its functions and duties  hereunder, the Administrative Agent shall act solely as agent for the Investors and the Funding Agents  and does not assume nor shall it be deemed to have assumed any obligation or relationship of trust or  agency with or for any Co-Issuers or any of its successors or assigns. The provisions of this Article (other  than the rights of the Co-Issuers set forth in Section 5.07) are solely for the benefit of the Administrative  Agent, the Investors and the Funding Agents, and the Co-Issuers shall not have any rights as a third party  beneficiary of any such provisions.  The Administrative Agent shall not be required to take any action  that, in its opinion or the opinion of its counsel, exposes the Administrative Agent to personal liability or  that is contrary to this Agreement or any Requirement of Law. The appointment and authority of the  Administrative Agent hereunder shall terminate upon the indefeasible payment in full of the Series 2018- 1 Class A Notes and all other amounts owed by the Co-Issuers hereunder to the Administrative Agent and  all members of the Investor Groups (the “Aggregate Unpaids”) and termination in full of all  Commitments.                SECTION 5.02     Delegation of Duties. The Administrative Agent may execute any of  its duties under this Agreement by or through agents or attorneys-in-fact and shall be entitled to advice of  counsel concerning all matters pertaining to such duties. The exculpatory provisions of this Article shall  apply to any such agents or attorneys-in-fact and shall apply to each of their respective activities as the  Administrative Agent.  The Administrative Agent shall not be responsible for the negligence or  misconduct of any agents or attorneys-in-fact selected by it in good faith.                SECTION 5.03     Exculpatory Provisions. Neither the Administrative Agent nor any of  its directors, managers, officers, agents or employees shall be (a) liable for any action lawfully taken or  omitted to be taken by it or them under or in connection with this Agreement (except for its, their or such  Person’s own gross negligence or willful misconduct as determined by a court of competent jurisdiction  by a final and nonappealable judgment), or (b) responsible in any manner to any Investor or any Funding  Agent for any recitals, statements, representations or warranties made by any Co-Issuer, the Property  Manager or Parent contained in this Agreement or in any certificate, report, statement or other document  referred to or provided for in, or received under or in connection with, this Agreement for the due  execution, legality, value, validity, effectiveness, genuineness, enforceability or sufficiency of this  Agreement or any other document furnished in connection herewith, or for any failure of the Co-Issuers,  the Property Manager or Parent to perform its obligations hereunder, or for the satisfaction of any  condition specified in Article VII.  The Administrative Agent shall not be under any obligation to any  Investor or any Funding Agent to ascertain or to inquire as to the observance or performance of any of the  agreements or covenants contained in, or conditions of, this Agreement, or to inspect the properties,  books or records of the Co-Issuers.  The Administrative Agent shall not be deemed to have knowledge of                                              28  DMSLIBRARY01\32647597  

 

   any Early Amortization Event, Default or Event of Default unless the Administrative Agent has received  notice in writing of such event from any Co-Issuer, any Investor or any Funding Agent.                SECTION 5.04     Reliance.  The Administrative Agent shall in all cases be entitled to  rely, and shall be fully protected in relying, upon any document or conversation believed by it to be  genuine and correct and to have been signed, sent or made by the proper Person or Persons and upon  advice and statements of legal counsel (including, without limitation, counsel to the Co-Issuers),  independent accountants and other experts selected by the Administrative Agent. The Administrative  Agent shall in all cases be fully justified in failing or refusing to take any action under this Agreement or  any other document furnished in connection herewith unless it shall first receive such advice or  concurrence of any Investor or any Funding Agent as it deems appropriate or it shall first be indemnified  to its satisfaction by any Investor or any Funding Agent; provided that unless and until the Administrative  Agent shall have received such advice, the Administrative Agent may take or refrain from taking any  action, as the Administrative Agent shall deem advisable and in the best interests of the Investors and the  Funding Agent. The Administrative Agent shall in all cases be fully protected in acting, or in refraining  from acting, in accordance with a request of Investor Groups holding more than 50% of the Commitments  and such request and any action taken or failure to act pursuant thereto shall be binding upon the Investors  and the Funding Agents.                SECTION 5.05     Non-Reliance on the Administrative Agent and Other Purchasers.  Each of the Investors and the Funding Agents expressly acknowledges that neither the Administrative  Agent nor any of its officers, directors, employees, agents, attorneys-in-fact or Affiliates has made any  representations or warranties to it and that no act by the Administrative Agent hereafter taken, including,  without limitation, any review of the affairs of the Co-Issuers, shall be deemed to constitute any  representation or warranty by the Administrative Agent.  Each of the Investors and the Funding Agent  represents and warrants to the Administrative Agent that it has and will, independently and without  reliance upon the Administrative Agent and based on such documents and information as it has deemed  appropriate, made its own appraisal of, and investigation into, the business, operations, property,  prospects, financial and other conditions and creditworthiness of the Co-Issuers and made its own  decision to enter into this Agreement.                SECTION 5.06     The Administrative Agent in its Individual Capacity. The  Administrative Agent and any of its Affiliates may make loans to, accept deposits from, and generally  engage in any kind of business with any Co-Issuer or any Affiliate of any Co-Issuer as though the  Administrative Agent were not the Administrative Agent hereunder.                 SECTION 5.07     Successor Administrative Agent; Defaulting Administrative Agent.                       (a)  The Administrative Agent may, upon thirty (30) days’ notice to the Co- Issuers and each of the Investors and the Funding Agents, and the Administrative Agent will, upon the  direction of Investor Groups holding 100% of the Commitments (excluding any Commitments held by  Defaulting Investors), resign as the Administrative Agent, as applicable.  If the Administrative Agent  shall resign, then the Investor Groups holding more than (i) if no single Investor Group holds more than  50% of the Commitments, 50% of the Commitments or (ii) if a single Investor Group holds more than  50% of the Commitments, two thirds of the Commitments (excluding any Commitments held by the  resigning Administrative Agent or its Affiliates, and if all Commitments are held by the resigning  Administrative Agent or its Affiliates, then the Co-Issuers), during such 30-day period, shall appoint an  Affiliate of a member of the Investor Groups as a successor administrative agent, subject to the consent of  (i) the Co-Issuers at all times other than while an Event of Default has occurred and is continuing (which  consent of the Co-Issuers shall not be unreasonably withheld or delayed), and (ii) the Controlling Party  (which consent of the Controlling Party shall not be unreasonably withheld or delayed); provided that the                                             29  DMSLIBRARY01\32647597  

 

   Commitment of any Defaulting Investor shall be disregarded in the determination of whether any  threshold percentage of Commitments has been met under this Section 5.07(a). If for any reason no  successor Administrative Agent is appointed by the Investor Groups during such 30-day period, then  effective upon the expiration of such 30-day period, the Co-Issuers shall make (or cause to be made) all  payments in respect of the Aggregate Unpaids or under any fee letter delivered in connection herewith  (including, without limitation, the Series 2018-1 Class A Notes Fee Letter) directly to the Funding  Agents, and the Co-Issuers for all purposes shall deal directly with the Funding Agents until such time, if  any, as a successor administrative agent is appointed as provided above, and the Co-Issuers shall instruct  the Indenture Trustee in writing accordingly. After the retiring Administrative Agent’s resignation  hereunder as the Administrative Agent, the provisions of Section 9.05 and this Article V shall inure to its  benefit as to any actions taken or omitted to be taken by it while it was the Administrative Agent under  this Agreement.                       (b)  The Co-Issuers may, upon the occurrence of any of the following events  with respect to the Administrative Agent (any such event with respect to the Administrative Agent, a  “Defaulting Agent Event” of the Administrative Agent) seek and with the consent of Investor Groups  holding more than (i) if no single Investor Group holds more than 50% of the Commitments, 50% of the  Commitments or (ii) if a single Investor Group holds more than 50% of the Commitments, two thirds of  the Commitments, to remove the Administrative Agent and, upon such removal, the Investor Groups  holding more than 50% of the Commitments in the case of clause (i) above or two thirds of the  Commitments in the case of clause (ii) above (provided that the Commitment of any Defaulting Investor  shall be disregarded in the determination of whether any threshold percentage of Commitments has been  met under this Section 5.07(b)) shall appoint an Affiliate of a member of the Investor Groups as a  successor administrative agent, subject to the consent of (x) the Co-Issuers at all times other than while an  Event of Default has occurred and is continuing (which consent of the Co-Issuers shall not be  unreasonably withheld or delayed) and (y) the Controlling Party (which consent of the Controlling Party  shall not be unreasonably withheld or delayed): (i) an Event of Bankruptcy with respect to the  Administrative Agent; (ii) if the Person acting as Administrative Agent or an Affiliate thereof is also an  Investor, any other event pursuant to which such Person becomes a Defaulting Investor; (iii) the failure by  the Administrative Agent to pay or remit any funds required to be remitted when due (in each case, if  amounts are available for payment or remittance in accordance with the terms of this Agreement for  application to the payment or remittance thereof) which continues for two (2) Business Days after such  funds were required to be paid or remitted; (iv) any representation, warranty, certification or statement  made by the Administrative Agent under this Agreement or in any agreement, certificate, report or other  document furnished by the Administrative Agent proves to have been false or misleading in any material  respect as of the time made or deemed made, and if such representation, warranty, certification or  statement is susceptible of remedy in all material respects, is not remedied within thirty (30) calendar  days after knowledge thereof or notice by the Co-Issuers to the Administrative Agent and if not  susceptible of remedy in all material respects, upon notice by the Co-Issuers to the Administrative Agent,  or (v) any act constituting the gross negligence, bad faith or willful misconduct of the Administrative  Agent.  If for any reason no successor the Administrative Agent is appointed by the Investor Groups  within thirty (30) days of the removal of the Administrative Agent pursuant to this clause (b), then  effective upon the expiration of such 30-day period, the Co-Issuers shall make all payments in respect of  the Aggregate Unpaids or under any fee letter delivered in connection herewith (including, without  limitation, the Series 2018-1 Class A Notes Fee Letter) directly to the Funding Agents and the Co-Issuers  for all purposes shall deal directly with the Funding Agents until such time, if any, as a successor  administrative agent is appointed as provided above, and the Co-Issuers shall instruct the Indenture  Trustee in writing accordingly. After the removal of the Administrative Agent hereunder as the  Administrative Agent, the provisions of Section 9.05 and this Article V shall inure to its benefit as to any  actions taken or omitted to be taken by it while it was the Administrative Agent under this Agreement.                                             30  DMSLIBRARY01\32647597  

 

                       (c)  If a Defaulting Agent Event has occurred and is continuing, the Co-Issuers  may make (or cause to be made) all payments in respect of the Aggregate Unpaids or under any fee letter  delivered in connection herewith (including, without limitation, the Series 2018-1 Class A Notes Fee  Letter) directly to the Funding Agents, and the Co-Issuers for all purposes may deal directly with the  Funding Agents.                SECTION 5.08     Authorization and Action of Funding Agents. Each Investor is  hereby deemed to have designated and appointed its related Funding Agent set forth next to such  Investor’s name on Schedule I (or identified as such Investor’s Funding Agent pursuant to any applicable  Assignment and Assumption Agreement or Investor Group Supplement) as the agent of such Person  hereunder, and hereby authorizes such Funding Agent to take such actions as agent on its behalf and to  exercise such powers as are delegated to such Funding Agent by the terms of this Agreement together  with such powers as are reasonably incidental thereto. Each Funding Agent shall not have any duties or  responsibilities, except those expressly set forth herein, or any fiduciary relationship with the related  Investor Group, and no implied covenants, functions, responsibilities, duties, obligations or liabilities on  the part of such Funding Agent shall be read into this Agreement or otherwise exist for such Funding  Agent. In performing its functions and duties hereunder, each Funding Agent shall act solely as agent for  the related Investor Group and does not assume nor shall it be deemed to have assumed any obligation or  relationship of trust or agency with or for any Co-Issuer, any of its successors or assigns or any other  Person. Each Funding Agent shall not be required to take any action that exposes such Funding Agent to  personal liability or that is contrary to this Agreement or any Requirement of Law. The appointment and  authority of the Funding Agents hereunder shall terminate upon the indefeasible payment in full of the  Aggregate Unpaids of the Investor Groups and the termination in full of all the Commitments.                SECTION 5.09     Delegation of Duties. Each Funding Agent may execute any of its  duties under this Agreement by or through agents or attorneys-in-fact and shall be entitled to advice of  counsel concerning all matters pertaining to such duties. Each Funding Agent shall not be responsible for  the actions or any gross negligence, bad faith or willful misconduct of any agents or attorneys-in-fact  selected by it in good faith.                SECTION 5.10     Exculpatory Provisions. Each Funding Agent and its Affiliates, and  each of their directors, officers, agents or employees shall not be (a) liable for any action lawfully taken or  omitted to be taken by it or them under or in connection with this Agreement (except for its, their or such  Person’s own gross negligence, bad faith or willful misconduct), or (b) responsible in any manner to the  related Investor Group for any recitals, statements, representations or warranties made by any Co-Issuer  contained in this Agreement or in any certificate, report, statement or other document referred to or  provided for in, or received under or in connection with, this Agreement, or for the value, validity,  effectiveness, genuineness, enforceability or sufficiency of this Agreement or any other document  furnished in connection herewith, or for any failure of any Co-Issuer to perform its obligations hereunder,  or for the satisfaction of any condition specified in Article VII. Each Funding Agent shall not be under  any obligation to the related Investor Group to ascertain or to inquire as to the observance or performance  of any of the agreements or covenants contained in, or conditions of, this Agreement, or to inspect the  properties, books or records of any Co-Issuer. Each Funding Agent shall not be deemed to have  knowledge of any Early Amortization Event, Default or Event of Default unless such Funding Agent has  received notice of such event from the Co-Issuers or any member of the related Investor Group.                SECTION 5.11     Reliance. Each Funding Agent shall in all cases be entitled to rely,  and shall be fully protected in relying, upon any document or conversation believed by it to be genuine  and correct and to have been signed, sent or made by the proper Person or Persons and upon advice and  statements of the Administrative Agent and legal counsel (including, without limitation, counsel to the  Co-Issuers), independent accountants and other experts selected by such Funding Agent. Each Funding                                             31  DMSLIBRARY01\32647597  

 

   Agent shall in all cases be fully justified in failing or refusing to take any action under this Agreement or  any other document furnished in connection herewith unless it shall first receive such advice or  concurrence of the related Investor Group as it deems appropriate or it shall first be indemnified to its  satisfaction by the related Investor Group; provided that unless and until such Funding Agent shall have  received such advice, such Funding Agent may take or refrain from taking any action, as such Funding  Agent shall deem advisable and in the best interests of the related Investor Group. Each Funding Agent  shall in all cases be fully protected in acting, or in refraining from acting, in accordance with a request of  the related Investor Group and such request and any action taken or failure to act pursuant thereto shall be  binding upon the related Investor Group.                SECTION 5.12     Non-Reliance on the Funding Agent and Other Purchasers. The  related Investor Group expressly acknowledges that its Funding Agent and any of its officers, directors,  employees, agents, attorneys-in-fact or Affiliates has not made any representations or warranties to it and  that no act by such Funding Agent hereafter taken, including, without limitation, any review of the affairs  of the Co-Issuers, shall be deemed to constitute any representation or warranty by such Funding Agent.  The related Investor Group represents and warrants to such Funding Agent that it has and will,  independently and without reliance upon such Funding Agent and based on such documents and  information as it has deemed appropriate, made its own appraisal of, and investigation into, the business,  operations, property, prospects, financial and other conditions and creditworthiness of the Co-Issuers and  made its own decision to enter into this Agreement.                SECTION 5.13     The Funding Agent in its Individual Capacity. Each Funding Agent  and any of its Affiliates may make loans to, accept deposits from, and generally engage in any kind of  business with any Co-Issuer or any Affiliate of a Co-Issuer as though such Funding Agent were not a  Funding Agent hereunder.                SECTION 5.14     Successor Funding Agent. Each Funding Agent will, upon the  direction of the related Investor Group, resign as such Funding Agent. If such Funding Agent shall resign,  then the related Investor Group shall appoint an Affiliate of a member of the related Investor Group as a  successor funding agent (it being understood that such resignation shall not be effective until such  successor is appointed). After any retiring Funding Agent’s resignation hereunder as Funding Agent,  subject to the limitations set forth herein, the provisions of Section 9.05 and this Article V shall inure to  its benefit as to any actions taken or omitted to be taken by it while it was the Funding Agent under this  Agreement.                                         ARTICLE VI                          REPRESENTATIONS AND WARRANTIES                SECTION 6.01     The Co-Issuers . The Co-Issuers jointly and severally represent and  warrant to the Administrative Agent and each Investor, as of the date of this Agreement and as of the date  of each Advance made hereunder, that:                       (a)  each of their representations and warranties made in favor of the Indenture  Trustee or the Noteholders in the Indenture and the other Transaction Documents (other than a  Transaction Document relating solely to a Series of Notes other than the Series 2018-1 Notes), including  without limitation, the representations and warranties contained in Sections 9.04(b), (c) and (d) of the  Indenture is true and correct (a) if not qualified as to materiality or Material Adverse Effect, in all  material respects and (b) if qualified as to materiality or Material Adverse Effect, in all respects, as of the  date originally made, as of the date hereof and as of the Series 2018-1 Closing Date (unless stated to  relate solely to an earlier date, in which case such representations and warranties shall be true and correct  in all material respects as of such earlier date);                                              32  DMSLIBRARY01\32647597  

 

                       (b)  no Default, Event of Default, Servicer Replacement Event, Early  Amortization Event or Sweep Period has occurred and is continuing;                       (c)  assuming the representations and warranties of each Investor set forth in  Section 6.04 of this Agreement are true and correct, neither they nor or any of their Affiliates, have,  directly or through an agent, engaged in any form of general solicitation or general advertising in  connection with the offering of the Series 2018-1 Class A Notes under the 1933 Act or in any manner  involving a public offering within the meaning of Section 4(a)(2) of the 1933 Act including, but not  limited to, articles, notices or other communications published in any newspaper, magazine, or similar  medium or broadcast over television or radio or any seminar or meeting whose attendees have been  invited by any general solicitation or general advertising; provided that no representation or warranty is  made with respect to the Investors and their Affiliates; and no Co-Issuer nor any of its Affiliates has  entered into any contractual arrangement with respect to the distribution of the Series 2018-1 Class A  Notes, except for this Agreement and the other Transaction Documents, and the Co-Issuers will not enter  into any such arrangement;                       (d)  neither they nor any of their Affiliates have, directly or through any agent,  sold, offered for sale, solicited offers to buy or otherwise negotiated in respect of, any “security” (as  defined in the 1933 Act) that is or will be integrated with the sale of the Series 2018-1 Class A Notes in a  manner that would require the registration of the Series 2018-1 Class A Notes under the 1933 Act;                       (e)  assuming the representations and warranties of each Investor set forth in  Section 6.04 of this Agreement are true and correct, the offer and sale of the Series 2018-1 Class A Notes  in the manner contemplated by this Agreement is a transaction exempt from the registration requirements  of the 1933 Act, and the Indenture and the Series 2018-1 Supplement are not required to be qualified  under the Trust Indenture Act of 1939, as amended;                        (f)  no Co-Issuer is required, or will be required as a result of the making of  Advances and the use of proceeds therefrom, to register as an “investment company” under the 1940 Act;  in connection with the foregoing, the Co-Issuers are relying on an exclusion from the definition of  “investment company” under Section 3(c)(5) of the 1940 Act, although additional exemptions or  exclusions may be available to the Co-Issuers; the Co-Issuers do not constitute a “covered fund” for  purposes of Section 619 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, otherwise  known as the “Volcker Rule;”                       (g)  the Series 2018-1 Class A Notes are “eligible assets” for purposes of Rule  3a-7 under the 1940 Act;                       (h)  the Co-Issuers have furnished to the Administrative Agent and each  Funding Agent true, accurate and complete copies of all other Transaction Documents (excluding Series  Supplements and other Transaction Documents relating solely to a Series of Notes other than the Series  2018-1 Notes) to which they are a party as of the Series 2018-1 Closing Date, all of which Transaction  Documents are in full force and effect as of the Series 2018-1 Closing Date and no terms of any such  agreements or documents have been amended, modified or otherwise waived as of such date, other than  such amendments, modifications or waivers about which the Co-Issuers has informed each Funding  Agent;                       (i)  none of the Co-Issuers or any of their respective subsidiaries nor, to the  knowledge of any of the Co-Issuers, any Affiliate, director, officer, manager, member, agent, employee or  other person acting on behalf of any of the Co-Issuers or any of their respective subsidiaries, has: (i) made  any unlawful contribution, gift, entertainment or other unlawful expense relating to political activity; (ii)                                             33  DMSLIBRARY01\32647597  

 

   made any direct or indirect unlawful payment to any domestic governmental official or “foreign official”  (as defined in the U.S. Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations  thereunder (collectively, the “FCPA”)); (iii) violated or is in violation of any provision of the FCPA, the  Bribery Act of 2010 of the United Kingdom or any applicable anti-bribery statute or regulation of any  other jurisdiction in which it operates its business, including, in each case, the rules and regulations  thereunder; or (iv) made any bribe, rebate, payoff, influence payment, kickback or other unlawful  payment; and the Co-Issuers (or the Property Manager on its behalf) maintain policies and procedures  designed to ensure, and which are reasonably expected to continue to ensure, compliance with the FCPA;                       (j)  the operations of the Co-Issuers and their respective subsidiaries are and  have been conducted at all times in material compliance with applicable financial record-keeping and  reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the  money laundering statutes of all applicable jurisdictions and the rules and regulations thereunder and any  related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental  agency (collectively, the “Money Laundering Laws”) and no action, suit or proceeding by or before any  court or governmental agency, authority or body or any arbitrator involving any of the Co-Issuers or their  respective subsidiaries with respect to the Money Laundering Laws is pending or, to the knowledge of  such relevant entity, threatened; and                       (k)  none of the Co-Issuers or any of their respective subsidiaries nor, to the  knowledge of any of the Co-Issuers, any director, manager, member, officer, employee, agent or Affiliate  of any of the Co-Issuers of any of their respective subsidiaries is currently subject to any sanctions  administered or enforced by the United States Government, including, without limitation, the U.S.  Department of the Treasury’s Office of Foreign Assets Control (“OFAC”), the U.S. Department of State  or the European Union (collectively, “Sanctions”); nor is such relevant entity located, organized or  resident in a country or territory that is subject to any Sanctions; and the Co-Issuers will not directly or to  their knowledge indirectly use the proceeds of any Borrowing, or lend, contribute or otherwise make  available such proceeds to any subsidiary, joint venture partner or other person or entity, for the purpose  of making payments in violation of Sanctions and the Co-Issuers (or the Property Manager on their  behalf) maintain policies and procedures designed to ensure, and which are reasonably expected to  continue to ensure, compliance with OFAC.                SECTION 6.02     The Parent. The Parent represents and warrants to each Investor and  the Administrative Agent as of the date hereof that:                       (a)  U.S. Risk Retention Rules.  The Parent is the “sponsor” (as such term is  defined in Regulation RR, 17 C.F.R. §246.1 et seq. (the “U.S. Risk Retention Rules”)) for purposes of the  “securitization transaction” (as such term is defined in the U.S. Risk Retention Rules) contemplated by  the Transaction Documents and is the appropriate entity to comply with all requirements imposed on the  sponsor of a securitization transaction in accordance with the provisions of the U.S. Risk Retention Rules  in connection with the securitization transaction contemplated by the Transaction Documents.  SMTA  Financing JV, LLC, a Delaware limited liability company that is a direct and indirect, wholly owned  subsidiary of the Parent, falls within the definition of “majority-owned affiliate” (as defined in the U.S.  Risk Retention Rules). On the Series 2018-1 Closing Date, the Parent, as the sponsor of the securitization  transaction contemplated by the Transaction Documents, will cause SMTA Financing JV, LLC, as a  majority-owned affiliate of the Parent, to hold an “eligible horizontal residual interest” (as such term is  defined in the U.S. Risk Retention Rules) with respect to the securitization transaction contemplated by  the Transaction Documents in an amount equal to at least 5% of the fair value of all the “ABS interests”  (as such term is defined in the U.S. Risk Retention Rules) issued as part of the securitization transaction  contemplated by the Transaction Documents, determined as of the Series 2018-1 Closing Date using a fair  value measurement framework under United States generally accepted accounting principles (such                                             34  DMSLIBRARY01\32647597  

 

   interest, the “Retained Interest”).  The Parent will cause SMTA Financing JV, LLC to hold the Retained  Interest for the period during which it is required to do so under the U.S. Risk Retention Rules.  The  Parent has determined such fair value of the Retained Interest based on its own valuation methodology,  inputs and assumptions and is solely responsible therefor.  As of the date of this Agreement, the Parent  has complied with and was solely responsible for ensuring that the disclosure required by Section 4(c)(1)  of the U.S. Risk Retention Rules was contained in this Agreement including, without limitation, in Part I  of Schedule IV attached hereto.                       (b)  E.U. Retention Requirements.  Spirit MTA REIT should qualify as an  “originator” within the meaning of Regulation (EU) No. 575/2013 (the “E.U. Capital Requirements  Regulation”) for the purposes of the securitization transaction contemplated by the Transaction  Documents on the basis that it has, either itself or through related entities, been involved in the original  negotiation of a proportion of the portfolio of Tenant Leases held by the Parent as of the Series 2018-1  Closing Date.  Accordingly, it will retain the E.U. Retained Interest (as such term is defined in Section  8.02(b)) pursuant to Section 8.02(b) in its capacity as an “originator” until the Series 2018-1 Class A  Notes have been paid in full and all related Commitments have been terminated.  The E.U. Retained  Interest shall constitute a retention of a material net economic interest of not less than 5 per cent. in the  securitisation within the meaning of paragraph 1(d) of Article 405 of the E.U. Capital Requirements  Regulation as supplemented by Article 8, paragraph 1(b) of Commission Delegated Regulation (EU) No  625/2014, paragraph 1(d) of Article 51 of the AIFMD Level 2 Regulation (as such term is defined in  Section 8.02(b)) and paragraph 2(d) of Article 254 of the Solvency II Level 2 Regulation (as such term is  defined in Section 8.02(b)).                SECTION 6.03     The Property Manager. The Property Manager represents and  warrants to each Investor and the Administrative Agent as of the date hereof that no Servicer  Replacement Event has occurred and is continuing and that its representations, warranties and covenants  in the Transaction Documents to which it is a party are true, correct and complete subject to any  materiality qualifier set forth therein as of the date on which such representations and warranties are  made.                SECTION 6.04     Investors. Each of the Investors represents and warrants to the Co- Issuers, the Property Manager, the Parent and the Administrative Agent as of the date hereof (or, in the  case of a successor or assign of an Investor, as of the subsequent date on which such successor or assign  shall become or be deemed to become a party hereto) that:                       (a)  it has had an opportunity to discuss the Co-Issuers’, the Property  Manager’s and the Parent’s business, management and financial affairs, and the terms and conditions of  the proposed purchase of the Series 2018-1 Class A Notes, with the Co-Issuers, the Property Manager and  the Parent and their respective representatives;                       (b)  it is an “accredited investor” within the meaning of Rule 501(a)(1), (2), (3)  or (7) of Regulation D under the 1933 Act and has sufficient knowledge and experience in financial and  business matters to be capable of evaluating the merits and risks of investing in, and is able and prepared  to bear the economic risk of investing in, the Series 2018-1 Class A Notes;                       (c)  it is purchasing the Series 2018-1 Class A Notes for its own account, or for  the account of one or more “accredited investors” within the meaning of Rule 501(a)(1), (2), (3) or (7) of  Regulation D under the 1933 Act that meet the criteria described in clause (b) above and for which it is  acting with complete investment discretion, for investment purposes only and not with a view to a  distribution in violation of the 1933 Act, subject, nevertheless, to the understanding that the disposition of  its property shall at all times be and remain within its control, and neither it nor its Affiliates has engaged                                             35  DMSLIBRARY01\32647597  

 

   in any general solicitation or general advertising within the meaning of the 1933 Act, or the rules and  regulations promulgated thereunder, with respect to the Series 2018-1 Class A Notes;                       (d)  it understands that (i) the Series 2018-1 Class A Notes have not been and  will not be registered or qualified under the 1933 Act or any applicable state securities laws or the  securities laws of any other jurisdiction and are being offered only in a transaction not involving any  public offering within the meaning of the 1933 Act and may not be resold or otherwise transferred unless  so registered or qualified or unless an exemption from registration or qualification is available and an  opinion of counsel shall have been delivered in advance to the Co-Issuers, (ii) the Co-Issuers are not  required to register the Series 2018-1 Class A Notes under the 1933 Act or any applicable state securities  laws or the securities laws of any other jurisdiction, (iii) any permitted transferee hereunder must meet the  criteria in clause (b) above and (iv) any transfer must comply with the provisions of Section 2.05 of the  Indenture and Section 9.03 or 9.17, as applicable, of this Agreement;                        (e)  it will comply with the requirements of Section 6.04(d), above, in  connection with any transfer by it of the Series 2018-1 Class A Notes;                       (f)  it understands that the Series 2018-1 Class A Notes will bear the legend set  out in the form of Series 2018-1 Notes attached as Exhibit A-3 to the Indenture and be subject to the  restrictions on transfer described in such legend;                       (g)  it will obtain for the benefit of the Co-Issuers from any purchaser of the  Series 2018-1 Class A Notes substantially the same representations and warranties contained in the  foregoing paragraphs; and                       (h)  the acknowledgments and agreements of the Investor set forth in the form  of Purchaser’s Letter set forth in Exhibit D attached hereto are true and correct with respect to the  Investor as of the Series 2018-1 Closing Date without requiring the delivery of a Purchaser’s Letter by the  Investor on the Series 2018-1 Closing Date.                                        ARTICLE VII                                       CONDITIONS                SECTION 7.01     Conditions to Issuance and Effectiveness. Each Investor will have no  obligation to purchase the Series 2018-1 Class A Notes hereunder on the Series 2018-1 Closing Date, and  the Commitments will not become effective, unless:                       (a)  the Indenture, the Series 2018-1 Supplement and the other Transaction  Documents shall be in full force and effect;                       (b)  on the Series 2018-1 Closing Date, the Administrative Agent shall have  received a letter, in form and substance reasonably satisfactory to the it, from S&P stating that the Series  2018-1 Class A Notes have received a rating of not less than “A+” ; and                        (c)  at the time of such issuance, the additional conditions set forth in Schedule  III and all other conditions to the issuance of the Series 2018-1 Class A Notes under the Indenture and the  Series 2018-1 Supplement shall have been satisfied or waived.                SECTION 7.02     Conditions to Initial Extensions of Credit. The election of each  Conduit Investor to fund, and the obligation of each Committed Note Purchaser to fund, the initial  Borrowing hereunder on or after the date hereof, shall be subject to the satisfaction of the conditions                                             36  DMSLIBRARY01\32647597  

 

   precedent that (a) each Funding Agent shall have received a duly executed and authenticated Series 2018- 1 Class A Note registered in its name or in such other name as shall have been directed by such Funding  Agent and stating that the principal amount thereof shall not exceed the Maximum Investor Group  Principal Amount of the related Investor Group and (b) the Co-Issuers shall have paid all fees required to  be paid by it under the Transaction Documents on the Series 2018-1 Closing Date, including the Series  2018-1 Class A Upfront Fee.                  SECTION 7.03     Conditions to Each Extension of Credit. The election of each  Conduit Investor to fund, and the obligation of each Committed Note Purchaser to fund, any Borrowing  on any day (including the initial Borrowing on or after the Series 2018-1 Closing Date) shall be subject to  the conditions precedent that on the date of such funding or provision, before and after giving effect  thereto and to the application of any proceeds therefrom, the following statements shall be true (without  regard to any waiver, amendment or other modification of this Section 7.03 or any definitions used herein  consented to by the Controlling Party unless Investors holding more than (i) if no single Investor Group  holds more than 50% of the Commitments, 50% of the Commitments or (ii) if a single Investor Group  holds more than 50% of the Commitments, two thirds of the Commitments (provided that the  Commitment of any Defaulting Investor shall be disregarded in the determination of whether any  threshold percentage of Commitments has been met under this Section 7.03) have consented to such  waiver, amendment or other modification for purposes of this Section 7.03; provided, further, that if the  second proviso to the first sentence of Section 9.01 is applicable to such waiver, amendment or other  modification, then consent to such waiver, amendment or other modification from the Persons required by  such second proviso shall also be required for purposes of this Section 7.03):                       (a)  no Default, Event of Default, Servicer Replacement Event, Early  Amortization Event or Sweep Period will be in existence at the time of, or after giving effect to, such  funding or issuance;                       (b)  the Commitment Term is in effect;                       (c)  after giving effect to such draw, the following conditions will be satisfied:                            (i)  the Class A LTV Ratio is equal to or less than 70%;                           (ii)  the Average Cashflow Coverage Ratio  for the most recently ended        three-month period, as of the last day of the immediately preceding calendar month is greater than        or equal to 1.40:1.00; and                          (iii)  the Series 2018-1 Class A Outstanding Principal Amount does not        exceed the Series 2018-1 Class A Notes Maximum Principal Amount after giving effect to any        reduction thereto pursuant to Section 2.05;                        (d)  all Series 2018-1 Class A Undrawn Commitment Fees together will all  other amounts due and payable on or prior to the date of such funding or issuance pursuant to this  Agreement shall have been paid in full on or prior to such date;                        (e)  in the case of any Borrowing, except to the extent an advance request is  expressly deemed to have been delivered hereunder, the Co-Issuers shall have delivered or have been  deemed to have delivered to the Administrative Agent an executed advance request in the form of Exhibit  A hereto with respect to such Borrowing (each such request, an “Advance Request” or a “Series 2018-1  Class A Advance Request”);                                              37  DMSLIBRARY01\32647597  

 

                       (f)  the Co-Issuers shall have furnished to the Administrative Agent true,  accurate and complete copies of all other Transaction Documents (excluding any Series Supplements and  other Transaction Documents relating solely to a Series other than the Series 2018-1 Notes) to which the  Co-Issuers, the Property Manager or the Parent is a party as of the Series 2018-1 Closing Date that has  not been previously delivered pursuant to Section 7.01(c), all of which Transaction Documents are in full  force and effect as of the Series 2018-1 Closing Date and no terms of any such agreements or documents  have been amended, modified or otherwise waived as of such date except as permitted under the  Indenture;                        (g)  the representations and warranties of the Co-Issuers, the Property Manager  and the Parent set out in this Agreement are true and correct (A) if qualified as to materiality or Material  Adverse Effect, in all respects and (B) if not qualified as to materiality or Material Adverse Effect, in all  material respects, as of the date of such funding or issuance, with the same effect as though made on that  date (unless stated to relate solely to an earlier date, in which case such representations and warranties  shall have been true and correct as of such earlier date);                       (h)  each representation and warranty made by the Property Manager in any  Transaction Document (other than a Transaction Document relating solely to a Series of Notes or other  than the Series 2018-1 Notes) to which the Property Manager is a party (including any representations and  warranties made by it in its capacity as Property Manager) is true and correct (a) if not qualified as to  materiality or Material Adverse Effect, in all material respects and (b) if qualified as to materiality or  Material Adverse Effect, in all respects as of the date originally made, as of the date hereof and as of the  Series 2018-1 Closing Date (unless stated to related solely to an earlier date, in which case such  representations and warranties were true and correct in all material respects as of such earlier date);                        (i)  the rating assigned to the Series 2018-1 Class A Notes by S&P  has not  been downgraded below “A+” (or the structured finance equivalent) or withdrawn; and                       (j)  all conditions to such extension of credit or provision specified in Section  2.02 or 2.03 of this Agreement, as applicable, shall have been satisfied.    The giving of any notice pursuant to Section 2.03 shall constitute a representation and warranty by the  Co-Issuers and the Property Manager that all conditions precedent to such funding or provision have been  satisfied or will be satisfied concurrently therewith.                                        ARTICLE VIII                                       COVENANTS                SECTION 8.01     Covenants of the Co-Issuers. Each of the Co-Issuers jointly and  severally covenants and agrees that, until all Aggregate Unpaids have been paid in full and all  Commitments have been terminated, it will:                       (a)  unless waived in writing in the manner provided in the Transaction  Documents, duly and timely perform all of its covenants (both affirmative and negative) and obligations  under each Transaction Document to which it is a party;                       (b)  not amend, modify, waive or give any approval, consent or permission  under any provision of the Indenture or any other Transaction Document to which it is a party unless any  such amendment, modification, waiver or other action is in writing and made in accordance with the  terms of the Indenture or such other Transaction Document, as applicable;                                              38  DMSLIBRARY01\32647597  

 

                       (c)  reasonably concurrently with the time any report, notice or other document  is provided to the Rating Agency and/or the Indenture Trustee, or caused to be provided, by the Co- Issuers under the Indenture (including, without limitation, under Section 5.02, Section 6.01, Section 9.09  or Section 10.03(d) thereof or under the related Series Supplement) or under the Series 2018-1  Supplement, provide to each of the Administrative Agent and each Funding Agent with a copy of such  report, notice or other document;                       (d)  once per calendar year, following reasonable prior notice from the  Administrative Agent (the “Annual Inspection Notice”), and during regular business hours, permit any  one or more of the Administrative Agent or any Funding Agent or any of their respective agents,  representatives or permitted assigns, at the Co-Issuers’ expense, access (as a group, and not individually  unless only one such Person desires such access) to the offices of the Co-Issuers, (i) to examine and make  copies of and abstracts from all documentation relating to the Collateral on the same terms as are  provided to the Indenture Trustee under Section 12.16 of the Indenture, and (ii) to visit the offices of the  Co-Issuers for the purpose of examining such materials described in clause (i) above, and to discuss  matters relating to the Collateral, or the administration and performance of the Indenture, the Series 2018- 1 Supplement and the other Transaction Documents with any of the officers or employees or managers of  the Co-Issuers having knowledge of such matters; provided, however, that upon the occurrence and  during the continuation of an Early Amortization Event, Default or Event of Default, the Administrative  Agent or any Funding Agent or any of their respective agents, representatives or permitted assigns, at the  Co-Issuers’ expense may do any of the foregoing at any time during normal business hours and without  advance notice; provided, further, that, in addition to any visits made pursuant to provision of an Annual  Inspection Notice or during the continuation of an Early Amortization Event, Default or Event of Default,  Administrative Agent or any Funding Agent or any of its agents, representatives or permitted assigns, at  their own expense, may do any of the foregoing at any time during normal business hours following  reasonable prior notice with respect to the business of the Co-Issuers;                        (e)  not take, or cause to be taken, any action, including, without limitation,  acquiring any margin stock (as such term is defined under the regulations of the Board of Governors of  the Federal Reserve System, “Margin Stock”), that could cause the transactions contemplated by the  Transaction Documents to fail to comply with the regulations of the Board of Governors of the Federal  Reserve System, including Regulations T, U and X thereof;                       (f)  not permit any amounts owed with respect to the Series 2018-1 Class A  Notes to be secured, directly or indirectly, by any Margin Stock in a manner that would violate the  regulations of the Board of Governors of the Federal Reserve System, including Regulations T, U and X  thereof; and                       (g)  promptly provide such additional financial and other information with  respect to the Transaction Documents (other than Series Supplements and Transaction Documents  relating solely to a Series of Notes other than the Series 2018-1 Notes) or the Co-Issuers as the  Administrative Agent or any of the Funding Agents may from time to time reasonably request; and                       (h)  use the proceeds of the Series 2018-1 Class A Notes for general corporate  purposes of the Co-Issuers, including the making of distributions and the funding of acquisitions, in each  case, to the extent permitted under, and in accordance with the terms of, the Indenture and the other  Transaction Documents, and with respect to the acquisition of any Mortgaged Property or Mortgage Loan  as long as, after giving effect to such acquisition, no Asset Concentration will exceed the applicable  Maximum Asset Concentration or, if such excess exists before giving effect to such acquisition, it will not  be made worse or it will be reduced after giving effect to such acquisition.                                              39  DMSLIBRARY01\32647597  

 

                SECTION 8.02     Covenants of the Property Manager. The Property Manager  covenants and agrees that, except to the extent set forth below, until all Aggregate Unpaids have been  paid in full and the Commitments have been terminated:                       (a)  unless waived in writing in the manner provided in the Transaction  Documents, duly and timely perform all of its covenants (both affirmative and negative) and obligations  under each Transaction Document to which it is a party;                       (b)  not amend, modify, waive or give any approval, consent or permission  under any provision of the Indenture or any other Transaction Document to which it is a party unless any  such amendment, modification, waiver or other action is in writing and made in accordance with the  terms of the Indenture or such other Transaction Document, as applicable;                       (c)  reasonably concurrently with the time any report, notice or other document  is provided to the Rating Agency and/or the Indenture Trustee, or caused to be provided, by the Property  Manager under the Indenture (including, without limitation, under Section 5.02, Section 6.01, Section  9.09 or Section 10.03(d) thereof or under the related Series Supplement) or under the Series 2018-1  Supplement, provide to each of the Administrative Agent and each Funding Agent with a copy of such  report, notice or other document;                       (d)  once per calendar year, following reasonable prior notice from the  Administrative Agent (the “Annual Inspection Notice”), and during regular business hours, permit any  one or more of the Administrative Agent or any Funding Agent or any of their respective agents,  representatives or permitted assigns, at the Co-Issuers’ expense, access (as a group, and not individually  unless only one such Person desires such access) to the offices of the Property Manager, (i) to examine  and make copies of and abstracts from all documentation relating to the Collateral on the same terms as  are provided to the Indenture Trustee under Section 12.16 of the Indenture, and (ii) to visit the offices of  the Property Manager for the purpose of examining such materials described in clause (i) above, and to  discuss matters relating to the Collateral, or the administration and performance of the Indenture, the  Series 2018-1 Supplement and the other Transaction Documents with any of the officers or employees or  managers of the Property Manager having knowledge of such matters; provided, however, that upon the  occurrence and during the continuation of an Early Amortization Event, Default or Event of Default, the  Administrative Agent or any Funding Agent or any of their respective agents, representatives or permitted  assigns, at the Co-Issuers’ expense, may do any of the foregoing at any time during normal business hours  and without advance notice; provided, further that, in addition to any visits made pursuant to provision of  an Annual Inspection Notice or during the continuation of an Early Amortization Event, Default or Event  of Default, Administrative Agent or any Funding Agent or any of its agents, representatives or permitted  assigns, at their own expense, may do any of the foregoing at any time during normal business hours  following reasonable prior notice from the Administrative Agent or Funding Agent;                        (e)  promptly provide such additional financial and other information with  respect to the Transaction Documents (other than Series Supplements and Transaction Documents  relating solely to a Series of Notes other than the Series 2018-1 Notes) or the Property Manager as the  Administrative Agent or any of the Funding Agents may from time to time reasonably request.                SECTION 8.03     Covenants of the Parent. The Parent covenants and agrees that,  except to the extent set forth below, until the Series 2018-1 Class A Notes have been paid in full and the  Commitments have been terminated:                       (a)  U.S. Risk Retention Rules.  The Parent will comply with all requirements  with respect to the securitization transaction contemplated by the Transaction Documents imposed on the                                             40  DMSLIBRARY01\32647597  

 

   sponsor of a securitization transaction by the U.S. Risk Retention Rules, including having made all  disclosures required to be made to the Series 2018-1 Class A Noteholders on or prior to the date hereof as  set forth in Part I of Schedule IV attached hereto and the additional disclosures required to be made in the  first Monthly Report as the same shall be set forth in the first Indenture Trustee Report to be delivered to  the Series 2018-1 Class A Noteholders pursuant to the Indenture and the Series 2018-1 Supplement  following the Series 2018-1 Closing Date set forth in Part II of Schedule IV attached hereto.  The Parent  acknowledges and agrees that (i) the Parent (along with its advisors and consultants, excluding for this  purpose the Series 2018-1 Class A Noteholders) will determine the adequacy of the content of such  disclosures and, as among the Parent, the Co-Issuers and the Series 2018-1 Class A Noteholders, the  Parent is solely responsible therefor, and (ii) the Parent or a “majority-owned affiliate” (as defined in the  U.S. Risk Retention Rules) of the Parent will be responsible for the holding of the Retained Interest for  the duration specified in the U.S. Risk Retention Rules (without any hedging, transfer or financing of the  Retained Interest that would be prohibited under the U.S. Risk Retention Rules).                       (b)  E.U. Retention Requirements.  Spirit MTA REIT undertakes that it will  retain, on an ongoing basis, a material net economic interest of not less than 5% of the securitisation  (within the meaning of paragraph 1(d) of Article 405 of the E.U. Capital Requirements Regulation as  supplemented by Article 8, paragraph 1(b) of Commission Delegated Regulation (EU) No 625/2014,  paragraph 1(d) of Article 51 of the AIFMD Level 2 Regulation and paragraph 2(d) of Article 254 of the  Solvency II Level 2 Regulation) by directly retaining 100% of the limited liability company interest in its  direct and indirect, wholly owned subsidiary, SMTA Financing JV, LLC, and causing SMTA Financing  JV, LLC to directly retain 100% of the limited liability company interest in the Co-Issuers (the “E.U.  Retained Interest”), in each case until the Series 2018-1 Class A Notes have been paid in full and the  related Commitments have been terminated.  The Parent will not (and will not permit SMTA Financing  JV, LLC or any of its other Subsidiaries or Affiliates to) finance, transfer, hedge or otherwise mitigate its  credit risk under or associated with the E.U. Retained Interest, except to the extent permitted under the  E.U. Retention Requirements.  The Parent further acknowledges and agrees that:                            (i)  subject to any overriding legal or regulatory requirements or        constraints or contractual obligations binding upon them (including those relating to        confidentiality), it shall take such further action, provide such other information and enter into        such other agreements as may reasonably be required to satisfy the E.U. Retention Requirements        as of (A) the Series 2018-1 Closing Date and (B) solely as regards the provision of information        within its possession, any time prior to the payment in full of the Series 2018-1 Class A Notes        and termination of the related Commitments (in each case at the cost and expense of the party        seeking such information);                           (ii)  it shall confirm its continued compliance with the covenants set forth        in this Section 8.02(b) (which confirmation may be by electronic mail) (A) promptly upon a        reasonable request made in writing by any of the Indenture Trustee, the Controlling Party, the        Property Manager, the Co-Issuers, the Administrative Agent or the Series 2018-1 Class A        Noteholders, (B) in any event on a monthly basis to each of the Indenture Trustee, the Controlling        Party, the Property Manager, the Co-Issuers and the Administrative Agent including for purposes        of permitting the Indenture Trustee to disclose the confirmation of its continued compliance in the        Indenture Trustee Report to be made available to the Series 2018-1 Class A Noteholders on a        monthly basis pursuant to the Indenture and the Series 2018-1 Supplement in the manner set forth        in Schedule V attached hereto, (C) promptly following the occurrence and continuation of an        Event of Default in the manner set forth in Schedule V attached hereto and (D) promptly        following written request by any Series 2018-1 Class A Noteholder following a material change        in the performance of the Collateral underlying the Series 2018-1 Class A Notes or material                                             41  DMSLIBRARY01\32647597  

 

         breach to the Transaction Documents as determined by such Series 2018-1 Class A Noteholder in        the manner set forth in Schedule V attached hereto; and                          (iii)  it shall immediately notify the Indenture Trustee, the Controlling        Party, the Property Manager, the Co-Issuers, the Administrative Agent and the Series 2018-1        Class A Noteholders (which notification may be by electronic mail) if for any reason: (A) it        changes the manner or form in which it holds the E.U. Retained Interest in compliance with the        E.U. Retention Requirements; (B) it ceases to hold the E.U. Risk Retention in accordance with        this Section 8.02(b) or otherwise ceases to comply with the covenants set forth in this Section        8.02(b) or (C) its representations set forth in Section 6.02(b) fail to be true, correct and complete        as of any date prior to the payment in full of all of the Series 2018-1 Class A Notes and        termination of all of the Commitments.   For purposes of this Section 8.02:    (1)   “E.U. Retention Requirements” means the CRR Retention Requirements, the AIFMD Retention        Requirements and the Solvency II Retention Requirements.   (2)   “CRR Retention Requirements” means Articles 404 to 410 of the E.U. Capital Requirements        Regulation, together with Commission Delegated Regulation (EU) No 625/2014 of 13 March        2014 and any other guidelines, implementing or delegated regulations and technical standards        published in relation thereto by the European Supervisory Authorities (jointly or individually) or        the European Commission as may be effective from time to time; provided, that any reference to        the E.U. Capital Requirements Regulation or to the CRR Retention Requirements shall be        deemed to include any successor or replacement provisions included in any European Union        directive or regulation.   (3)   “AIFMD Retention Requirements” means Article 17 of the AIFMD, as supplemented by Section        5 of Chapter 3 of Commission Delegated Regulation (EU) No 231/2013 of 19 December 2012        (the “AIFMD Level 2 Regulation”), including any guidance published in relation thereto and any        implementing laws or regulations in force in any Member State of the European Union, provided        that references to the AIFMD Retention Requirements shall be deemed to include any successor        or replacement provisions of AIFMD Level 2 Regulation included in any European Union        directive or regulation subsequent to the AIFMD and/or the AIFMD Level 2 Regulation.   (4)   “AIFMD” means EU Directive 2011/61/EU on Alternative Investment Fund Managers (as        amended from time to time and as implemented by Member States of the European Union)        together with any implementing or delegated regulation, technical standards and guidance related        thereto as may be amended, replaced or supplemented from time to time.   (5)   “Solvency II Retention Requirements” means Article 135(2) of the Solvency II Directive, as        supplemented by Articles 254 to 257 of the Solvency II Level 2 Regulation, including any        guidance published in relation thereto and any implementing laws or regulations in force in any        Member State of the European Union, provided that references to Solvency II Retention        Requirements shall be deemed to include any successor or replacement provisions of the        Solvency II Level 2 Regulation included in any European Union directive or regulation        subsequent to Solvency II and/or the Solvency II Level 2 Regulation.   (6)   “Solvency II Directive” means EU Directive 2009/138/EC, as may be amended, replaced or        supplemented from time to time.                                              42  DMSLIBRARY01\32647597  

 

   (7)   “Solvency II Level 2 Regulation” means Commission Delegated Regulation (EU) 2015/35,        supplementing the Solvency II Directive.                                         ARTICLE IX                              MISCELLANEOUS PROVISIONS                SECTION 9.01     Amendments.                        (a)  Subject to Section 3.04(b), no amendment to or waiver or other  modification of any provision of this Agreement, nor consent to any departure therefrom by the Co- Issuers, the Property Manager or the Parent, shall in any event be effective unless the same shall be in  writing and signed by the Co-Issuers with the written consent of (A) the Administrative Agent (acting at  the direction of the Funding Agents) and (B) Investor Groups holding more than (i) if no single Investor  Group holds more than 50% of the Commitments, 50% of the Commitments or (ii) if a single Investor  Group holds more than 50% of the Commitments, two-thirds of the Commitments; provided that the  Commitment of any Defaulting Investor shall be disregarded in the determination of whether such  threshold percentage of Commitments has been met; provided, however, that, in addition, (i) the prior  written consent of each affected Investor shall be required in connection with any amendment,  modification or waiver that (x) increases the amount of the Commitment of such Investor, extends the  Commitment Termination Date or the Series 2018-1 Class A Anticipated Repayment Date, modifies the  conditions to funding the Commitment or otherwise subjects such Investor to any increased or additional  duties or obligations hereunder or in connection herewith (it being understood and agreed that waivers or  modifications of conditions precedent, covenants, Defaults or Events of Default or of a mandatory  reduction in the aggregate Commitments shall not constitute an increase of the Commitments of any  Investor), (y) reduces the amount or delays the timing of payment of any principal, interest, fees or other  amounts payable to such Investor hereunder or (z) would have an effect comparable to any of those set  forth in Section 8.02 of the Indenture that require the consent of each Noteholder or each affected  Noteholder; (ii) any amendment, modification or waiver that affects the rights or duties of any of the  Administrative Agent or the Funding Agents shall require the prior written consent of such affected  Person; and (iii) the prior written consent of each Investor, the Administrative Agent and each Funding  Agent shall be required in connection with any amendment, modification or waiver of this Section 9.01.   Commitments (other than the Commitments of any Defaulting Investor) shall be deemed to be fully  drawn for purposes of any provision of the Indenture or the other Transaction Documents relating to any  vote, consent, direction or the like to be given by the Series 2018-1 Class A Noteholders as the Series  2018-1 Class A Noteholders or as Noteholders; such vote, consent, direction or the like shall be given by  the Holders of the Series 2018-1 Class A Notes only except to the extent that such vote, consent, direction  or the like is to be given by each affected Noteholder would be affected thereby. In addition, the  provisions of Section 6.01(a) (with respect to the reference to Sections 9.04(b), (c) and (d) of the  Indenture) may not be amended or waived without confirmation from S&P that the rating of the  commercial paper notes of each Conduit Investor then rated by it will not be reduced or withdrawn as a  result thereof. Each Series 2018-1 Class A Noteholder hereby authorizes the Administrative Agent to  consent to any amendment pursuant to Section 3.04 or pursuant to the first sentence of Section 8.04 of the  Indenture.                       (b)  Each Committed Note Purchaser will notify the Co-Issuers in writing  whether or not it will consent to a proposed amendment, waiver or other modification of this Agreement  and, if applicable, any condition to such consent, waiver or other modification. If a Committed Note  Purchaser notifies the Co-Issuers in writing that such Committed Note Purchaser either (I) will not  consent to an amendment to or waiver or other modification of any provision of this Agreement or (II)  conditions its consent to such an amendment, waiver or other modification of any provision of this  Agreement upon the payment of an amendment fee, the Co-Issuers may replace every member (but not                                             43  DMSLIBRARY01\32647597  

 

   any subset thereof) of such Committed Note Purchaser’s entire Investor Group by giving written notice to  each member of such Investor Group and the Administrative Agent designating one or more Persons that  are willing and able to purchase each member of such Investor Group’s rights and obligations under this  Agreement for a purchase price that with respect to each such member of such Investor Group will equal  the amount owed to each such member of such Investor Group with respect to the Series 2018-1 Class A  Notes (whether arising under the Indenture, the Series 2018-1 Supplement, this Agreement, the Series  2018-1 Class A Notes or otherwise). Upon receipt of such written notice, each member of such Investor  Group shall assign its rights and obligations under this Agreement pursuant to and in accordance with  Sections 9.17(a), (b) and (c), as applicable, in consideration for such purchase price and at the reasonable  expense of the Co-Issuers (including, without limitation, the reasonable documented fees and out-of- pocket expenses of counsel to each such member); provided, however, that no member of such Investor  Group shall be obligated to assign any of its rights and obligations under this Agreement if the purchase  price to be paid to such member is not at least equal to the amount owed to such member with respect to  the Series 2018-1 Class A Notes (whether arising under the Indenture, the Series 2018-1 Supplement, this  Agreement, the Series 2018-1 Class A Notes or otherwise).                       (c)  The Co-Issuers and the Investors shall negotiate any amendments, waivers,  consents, supplements or other modifications to this Agreement or the other Transaction Documents that  require the consent of the Investors in good faith. Pursuant to Section 9.05(a), the Investors shall be  entitled to reimbursement by the Co-Issuers for the reasonable expenses incurred by the Investors in  reviewing and approving any such amendment, waiver, consent, supplement or other modification to this  Agreement or any Transaction Document. The Co-Issuers agrees to provide notice to each Investor Group  of any amendment to this Agreement, regardless of whether the consent of such Investor is required for  such amendment to become effective.                SECTION 9.02     No Waiver; Remedies. Any waiver, consent or approval given by  any party hereto shall be effective only in the specific instance and for the specific purpose for which  given, and no waiver by a party of any breach or default under this Agreement shall be deemed a waiver  of any other breach or default. No failure on the part of any party hereto to exercise, and no delay in  exercising, any right hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of  any right hereunder, or any abandonment or discontinuation of steps to enforce the right, power or  privilege, preclude any other or further exercise thereof or the exercise of any other right. No notice to or  demand on any party hereto in any case shall entitle such party to any other or further notice or demand in  the same, similar or other circumstances. The remedies herein provided are cumulative and not exclusive  of any remedies provided by law.                SECTION 9.03     Binding on Successors and Assigns.                       (a)  This Agreement shall be binding upon, and inure to the benefit of, the Co- Issuers, the Property Manager, the Parent, the Investors, the Funding Agents, the Administrative Agent  and their respective successors and assigns; provided, however, that none of the Co-Issuers, the Property  Manager or the Parent may assign its rights or obligations hereunder or in connection herewith or any  interest herein (voluntarily, by operation of law or otherwise), except as expressly permitted under the  Transaction Documents or with the prior written consent of each Investor (other than any Defaulting  Investor); provided further that nothing herein shall prevent the Co-Issuers from assigning its rights (but  none of its duties or liabilities) to the Indenture Trustee under the Indenture and the Series 2018-1  Supplement; and provided, further that none of the Investors may transfer, pledge, assign, sell  participations in or otherwise encumber its rights or obligations hereunder or in connection herewith or  any interest herein except as permitted under Section 6.04 or Section 9.17 or this Section 9.03. Nothing  expressed herein is intended or shall be construed to give any Person other than the Persons referred to in                                              44  DMSLIBRARY01\32647597  

 

   the preceding sentence any legal or equitable right, remedy or claim under or in respect of this Agreement  except as provided in Section 9.16.                       (b)  Notwithstanding any other provision set forth in this Agreement, each  Investor may at any time grant to one or more Program Support Providers a participating interest in or  lien on such Investor’s interests in the Advances made hereunder and such Program Support Provider,  with respect to its participating interest, shall be entitled to the benefits granted to such Investor under this  Agreement. In addition, any Investor may at any time sell participations to any Person in all or a portion  of such Investor’s rights and/or obligations under this Agreement, the Series 2018-1 Class A Notes and  the Advances made thereunder and, in connection therewith, any other Transaction Documents to which it  is a party, and such participant, with respect to its participating interest, shall be entitled to the benefits  granted to such Investor under this Agreement; provided that (i) such Investor’s obligations under this  Agreement shall remain unchanged, (ii) such Investor shall remain solely responsible to the other parties  hereto for the performance of such obligations, and (iii) the Co-Issuers, the Administrative Agent and  each other Investor shall continue to deal solely and directly with such Investor in connection with such  Investor’s rights and obligations under this Agreement; provided that such participant shall not be entitled  to receive any greater payment under Section 3.05, 3.07 or 3.08, with respect to any participation, than its  participating Investor would have been entitled to receive, except to the extent such entitlement to receive  a greater payment results from Change in Law that occurs after the participant acquired the applicable  participation so long as such Change in Law would apply equally to such participating Investor. Each  Investor that sells a participating interest shall, acting solely for this purpose as a nonfiduciary agent of  the Co-Issuers, maintain a register on which it enters the name and address of each related participant and  the applicable portions of the Series 2018-1 Class A Outstanding Principal Amount (and stated interest)  relating to such participant, provided that no Investor shall have any obligation to disclose all or any  portion of such register to any Person except to the extent that such disclosure is necessary to establish  that the relevant Series 2018-1 Class A Notes are in registered form under Section 5f.103-1(c) and  Proposed Treasury Regulations 1.163-5(b) of the U.S. Treasury regulations (or any successor version).                       (c)  In addition to its rights under Section 9.17, each Conduit Investor may at  any time assign its rights in the Series 2018-1 Class A Notes (and its rights hereunder and under the  Transaction Documents) to its related Committed Note Purchaser or, subject to Section 6.04 and Section  9.17(d), its related Program Support Provider or any Affiliate of any of the foregoing, in each case in  accordance with the applicable provisions of the Indenture. Furthermore, each Conduit Investor may at  any time grant a security interest in and lien on, all or any portion of its interests under this Agreement, its  Series 2018-1 Class A Note and all Transaction Documents to (i) its related Committed Note Purchaser,  (ii) its Funding Agent, (iii) any Program Support Provider who, at any time now or in the future, provides  program liquidity or credit enhancement, including, without limitation, an insurance policy for such  Conduit Investor relating to the Commercial Paper or the Series 2018-1 Class A Notes, (iv) any other  Person who, at any time now or in the future, provides liquidity or credit enhancement for the Conduit  Investors, including, without limitation, an insurance policy relating to the Commercial Paper or the  Series 2018-1 Class A Notes, (v) any collateral trustee or collateral agent for any of the foregoing or (vi) a  trustee or collateral agent for the benefit of the holders of the commercial paper notes or other senior  indebtedness of such Conduit Investor appointed pursuant to such Conduit Investor’s program  documents; provided, however, that any such security interest or lien shall be released upon assignment of  its Series 2018-1 Class A Note to its related Committed Note Purchaser. Each Committed Note Purchaser  may assign its Commitment, or all or any portion of its interest under its Series 2018-1 Class A Note, this  Agreement and the Transaction Documents to any Person to the extent permitted by Section 9.17.  Notwithstanding any other provisions set forth in this Agreement, each Committed Note Purchaser may at  any time create a security interest in all or any portion of its rights under this Agreement, its Series 2018-1  Class A Note and the Transaction Documents in favor of any Federal Reserve Bank in accordance with  Regulation A of the F.R.S. Board or any similar foreign entity.                                             45  DMSLIBRARY01\32647597  

 

                SECTION 9.04     Survival of Agreement. All covenants, agreements, representations  and warranties made herein and in the Series 2018-1 Class A Notes delivered pursuant hereto shall  survive the making and the repayment of the Advances and the execution and delivery of this Agreement  and the Series 2018-1 Class A Notes and shall continue in full force and effect until all interest on and  principal of the Series 2018-1 Class A Notes, and all other amounts owed to the Investors, the Funding  Agents and the Administrative Agent hereunder and under the Series 2018-1 Supplement have been paid  in full and the Commitments have been terminated. In addition, the obligations of the Co-Issuers and the  Investors under Sections 3.05, 3.06, 3.07, 3.08, 9.05, 9.10 and 9.11 shall survive the termination of this  Agreement.                 SECTION 9.05     Payment of Costs and Expenses; Indemnification.                       (a)  Payment of Costs and Expenses. The Co-Issuers jointly and severally  agree to pay (by depositing such amounts into the applicable account maintained pursuant to the  Indenture be distributed subject to and in accordance with the Priority of Payments), on the Series 2018-1  Closing Date (if invoiced at least one (1) Business Day prior to such date) or on or before the next  succeeding Payment Date immediately after written demand (in all other cases), all reasonable  documented out-of-pocket expenses of the Administrative Agent, each initial Funding Agent and each  initial Investor (including the reasonable fees and out-of-pocket expenses of one external counsel for the  Administrative Agent), if any (but excluding, for the avoidance of doubt, fees and expenses, whether  allocated or otherwise, in respect of in-house counsel), as well as the fees and expenses of the Rating  Agency) in connection with (i) the negotiation, preparation, execution and delivery of this Agreement and  of each other Transaction Document, including schedules and exhibits, whether or not the transactions  contemplated hereby or thereby are consummated (including, without limitation, such reasonable and  documented expenses for the Committed Note Purchaser’s due diligence investigation, consultants’ fees  and travel expenses and fees incurred on or before the Series 2018-1 Closing Date to the extent invoiced  at least one (1) Business Day prior to such date), the administration of this Agreement and of each other  Transaction Document and the taking of any other action (whether through negotiations, through any  work-out, bankruptcy, restructuring or other legal or other proceeding (including, without limitation,  preparation for and/or response to any subpoena or request for document production relating thereto) or  otherwise) in respect of, or legal advice with respect to its rights or responsibilities under, this Agreement  and of each other Transaction Document; and (ii) any amendments, waivers, consents, supplements or  other modifications to this Agreement or any other Transaction Document as may from time to time  hereafter be proposed by the Property Manager or the Co-Issuers (the “Class A Amendment Expenses”).  The Co-Issuers further jointly and severally agree to pay, subject to and in accordance with the Priority of  Payments, and to hold the Administrative Agent, each Funding Agent and each Investor harmless from all  liability for (x) any breach by the Co-Issuers of its obligations under this Agreement, (y) all reasonable  documented out-of-pocket costs incurred by the Administrative Agent, such Funding Agent or such  Investor including the reasonable fees and out-of-pocket expenses of counsel to each of the foregoing,  including, for the avoidance of doubt, fees and expenses of in-house counsel, if any, in enforcing this  Agreement or in connection with the negotiation of any restructuring or “work-out”, whether or not  consummated, of the Transaction Documents and (z) any Non-Excluded Taxes that may be payable in  connection with (1) the execution or delivery of this Agreement, (2) any Borrowing hereunder, (3) the  issuance of the Series 2018-1 Class A Notes or (4) any other Transaction Documents.   The Co-Issuers  also jointly and severally agree to reimburse, subject to and in accordance with the Priority of Payments,  the Administrative Agent, such Funding Agent and Investor upon demand for all reasonable out-of-pocket  expenses incurred by the Administrative Agent, such Funding Agent and such Investor in connection with  the enforcement of this Agreement or any other Transaction Documents.  Notwithstanding the foregoing,  other than in connection with a sale or assignment pursuant to Section 9.18(a), the Co-Issuers shall have  no obligation to reimburse any Investor for any of the fees and/or expenses incurred by such Investor with                                             46  DMSLIBRARY01\32647597  

 

   respect to its sale or assignment of all or any part of its respective rights and obligations under this  Agreement and the Series 2018-1 Class A Notes pursuant to Section 9.03 or Section 9.17.                       (b)  Indemnification of the Investors. In consideration of the execution and  delivery of this Agreement by the Investors, the Co-Issuers hereby agree to jointly and severally  indemnify and hold each Investor, each Funding Agent and the Administrative Agent (each in its capacity  as such) and each of their officers, directors, employees and agents (collectively, the “Indemnified  Parties”) harmless (by depositing such amounts into the Collection Account to be distributed subject to  and in accordance with the Priority of Payments) from and against any and all fees, actions, causes of  action, suits, losses, liabilities and damages (other than Class A Taxes which shall be addressed in the  manner set forth in Section 3.08), and reasonable documented costs and expenses incurred in connection  therewith (irrespective of whether any such Indemnified Party is a party to the action for which  indemnification hereunder is sought and including, without limitation, any liability in connection with the  offering and sale of the Series 2018-1 Class A Notes), including reasonable documented attorneys’ fees  and disbursements and those amounts in connection with any action, claim or suit brought to enforce the  Indemnified Parties’ right to indemnification (collectively, the “Indemnified Liabilities” and the amounts  payable to the Indemnified Parties pursuant to this Section 9.05(b) being referred to herein as the “Class  A Indemnities”), incurred by the Indemnified Parties or any of them (whether in prosecuting or defending  against such actions, suits or claims) to the extent resulting from, or arising out of, or relating to:                             (i)  any transaction financed or to be financed in whole or in part,         directly or indirectly, with the proceeds of any Advance; or                           (ii)  the entering into and performance of this Agreement and any other        Transaction Document by any of the Indemnified Parties; or                          (iii)  any breach of a representation, warranty, covenant or agreement        made by the Co-Issuers hereunder;         except for any such Indemnified Liabilities arising for the account of a particular Indemnified        Party by reason of the relevant Indemnified Party’s gross negligence, bad faith or willful        misconduct or breach of representations set forth herein as determined by a final, non-appealable        judgment of a court of competent jurisdiction. If and to the extent that the foregoing undertaking        may be unenforceable for any reason, the Co-Issuers hereby jointly and severally agree to make        the maximum contribution to the payment and satisfaction of each of the Indemnified Liabilities        that is permissible under applicable law.                         (c)  Indemnification of the Administrative Agent and each Funding Agent. In  consideration of the execution and delivery of this Agreement by the Administrative Agent and the  related Funding Agent, each Committed Note Purchaser, ratably according to its respective Commitment,  hereby agrees to indemnify and hold the Administrative Agent and each of their respective officers,  directors, managers, employees, affiliates and agents (the “Administrative Agent Indemnified Parties”)  and such Funding Agent and each of its officers, directors, employees and agents (collectively, the  “Funding Agent Indemnified Parties,” and together with the Administrative Agent Indemnified Parties,  the “Applicable Agent Indemnified Parties”) harmless from and against any and all fees, actions, causes  of action, suits, losses, liabilities and damages, and reasonable costs and expenses incurred in connection  therewith (solely to the extent not reimbursed by or on behalf of the Co-Issuers) (irrespective of whether  any such Applicable Agent Indemnified Party is a party to the action for which indemnification hereunder  is sought and including, without limitation, any liability in connection with the offering and sale of the  Series 2018-1 Class A Notes), including reasonable attorneys’ fees and disbursements and those amounts  in connection with any action, claim or suit brought to enforce the Applicable Agent Indemnified Parties’                                             47  DMSLIBRARY01\32647597  

 

   right to indemnification (collectively, the “Applicable Agent Indemnified Liabilities”), incurred by the  Applicable Agent Indemnified Parties or any of them (whether in prosecuting or defending against such  actions, suits or claims) to the extent resulting from, or arising out of, or relating to the entering into and  performance of this Agreement and any other Transaction Document by any of the Applicable Agent  Indemnified Parties, except for any such Applicable Agent Indemnified Liabilities arising for the account  of a particular Applicable Agent Indemnified Party by reason of the relevant Applicable Agent  Indemnified Party’s gross negligence or willful misconduct. If and to the extent that the foregoing  undertaking may be unenforceable for any reason, each Committed Note Purchaser, ratably according to  its respective Commitment, hereby agrees to make the maximum contribution to the payment and  satisfaction of each of the Applicable Agent Indemnified Liabilities that is permissible under applicable  law. The indemnity set forth in this Section 9.05(c) shall in no event include indemnification for  consequential or indirect damages of any kind.                SECTION 9.06     Characterization as Transaction Document; Entire Agreement. This  Agreement shall be deemed to be a Transaction Document for all purposes of the Indenture and the other  Transaction Documents. This Agreement, together with the Indenture, the Series 2018-1 Supplement, the  documents delivered pursuant to Article VII and the other Transaction Documents, including the exhibits  and schedules thereto, contains a final and complete integration of all prior expressions by the parties  hereto with respect to the subject matter hereof and shall constitute the entire agreement among the parties  hereto with respect to the subject matter hereof, superseding all previous oral statements and other  writings with respect thereto.                SECTION 9.07     Notices. All notices, amendments, waivers, consents and other  communications provided to any party hereto under this Agreement shall be in writing and addressed,  delivered or transmitted to such party at its address, or e-mail address set forth below its signature hereto,  in the case of the Co-Issuers, the Property Manager or the Support Provider, or on Schedule II attached  hereto, in the case of the Investors, the Administrative Agent and the Funding Agents, or in each case at  such other address or e-mail address as may be designated by such party in a notice to the other parties.  Any notice, if mailed and properly addressed with postage prepaid or if properly addressed and sent by  pre-paid courier service, shall be deemed given when received; any notice, if transmitted by e-mail, shall  be deemed given when received.                SECTION 9.08     Severability of Provisions. Any covenant, provision, agreement or  term of this Agreement that is prohibited or is held to be void or unenforceable in any jurisdiction shall, as  to that jurisdiction, be ineffective to the extent of the prohibition or unenforceability without invalidating  the remaining provisions of this Agreement.                SECTION 9.09     Tax Characterization. (a)  Each party to this Agreement (i)  acknowledges that it is the intent of the parties to this Agreement that, for accounting purposes and for all  federal, state and local income and franchise tax purposes, the Series 2018-1 Class A Notes will be treated  as evidence of indebtedness, (ii) agrees to treat the Series 2018-1 Class A Notes for all such purposes as  indebtedness and (iii) agrees that the provisions of the Transaction Documents shall be construed to  further these intentions.                       (b)  Each Series 2018-1 Class A Noteholder shall, acting solely for this  purpose as an agent of the Co-Issuers, maintain a register on which it enters the name and address of each  related Investor (and, if applicable, Program Support Provider) and the applicable portions of the Series  2018-1 Class A Outstanding Principal Amount (and stated interest) with respect to such Series 2018-1  Class A Noteholder of each Investor (and, if applicable, Program Support Provider) that has an interest in  such Series 2018-1 Class A Noteholder’s Series 2018-1 Class A Notes (the “Series 2018-1 Class A Notes  Register”), provided that no Series 2018-1 Class A Noteholder shall have any obligation to disclose all or                                             48  DMSLIBRARY01\32647597  

 

   any portion of the Series 2018-1 Class A Notes Register to any Person except to the extent that such  disclosure is necessary to establish that such Series 2018-1 Class A Notes are in registered form under  Section 5f.103-1(c) and Proposed Treasury Regulations 1.163-5(b) of the U.S. Treasury regulations (or  any successor version).                SECTION 9.10     No Proceedings; Limited Recourse.                       (a)  The Co-Issuers. Each of the parties hereto (other than the Co-Issuers)  hereby covenants and agrees that, prior to the date that is one year and one day after the payment in full of  the last maturing Note issued by the Co-Issuers pursuant to the Indenture, it will not institute against, or  join with any other Person in instituting against, any Co-Issuer, any bankruptcy, reorganization,  arrangement, insolvency or liquidation proceedings, or other proceedings, under any federal or state  bankruptcy or similar law and subject to any retained rights set forth therein; provided, however, that  nothing in this Section 9.10(a) shall constitute a waiver of any right to indemnification, reimbursement or  other payment from the Co-Issuers pursuant to this Agreement, the Series 2018-1 Supplement, the  Indenture or any other Transaction Document.  In the event that an Investor (solely in its capacity as such)  takes action in violation of this Section 9.10(a), each affected Co-Issuer shall file or cause to be filed an  answer with the bankruptcy court or otherwise properly contest or cause to be contested the filing of such  a petition by any such Person against such Co-Issuer or the commencement of such action and raise or  cause to be raised the defense that such Person has agreed in writing not to take such action and should be  estopped and precluded therefrom and such other defenses, if any, as its counsel advises that it may assert.  Nothing contained herein shall preclude participation by an Investor in the assertion or defense of its  claims in any such proceeding involving any Co-Issuer. The obligations of the Co-Issuers under this  Agreement are solely the limited liability company or corporate, as the case may be, obligations of the  Co-Issuers.                       (b)  The Conduit Investors. Each of the parties hereto hereby covenants and  agrees that it will not, prior to the date that is one year and one day after the payment in full of all  Commercial Paper or other debt securities or instruments issued by a Conduit Investor, institute against,  or join with any other Person in instituting against, such Conduit Investor, any bankruptcy,  reorganization, arrangement, insolvency, examination or liquidation proceedings, or other proceedings  under any federal or state (or any other jurisdiction with authority over such Conduit Investor) bankruptcy  or similar law. In the event that any such party takes action in violation of this Section 9.10(b), such  related Conduit Investor may file an answer with the bankruptcy court or otherwise properly contest or  cause to be contested the filing of such a petition by any such party against such Conduit Investor or the  commencement of such action and raise or cause to be raised the defense that such party has agreed in  writing not to take such action and should be estopped and precluded therefrom and such other defenses,  if any, as its counsel advises that it may assert. Nothing contained herein shall preclude participation by  any of the Co-Issuers, the Property Manager or an Investor in assertion or defense of its claims in any  such proceeding involving a Conduit Investor. The obligations of the Conduit Investors under this  Agreement are solely the corporate obligations of the Conduit Investors. No recourse shall be had for the  payment of any amount owing in respect of this Agreement, including any obligation or claim arising out  of or based upon this Agreement, against any stockholder, employee, officer, agent, director, member,  affiliate or incorporator (or Person similar to an incorporator under state business organization laws) of  any Conduit Investor; provided, however, nothing in this Section 9.10(b) shall relieve any of the  foregoing Persons from any liability that any such Person may otherwise have for its gross negligence,  bad faith or willful misconduct.                       (c)  The parties hereto acknowledge and agree that any fees, costs, indemnified  amounts or expenses payable by a Conduit Investor pursuant to this Agreement (“Conduit Investor  Amounts”) shall be payable only in accordance with the order of priorities set forth in such Conduit                                             49  DMSLIBRARY01\32647597  

 

   Investor’s commercial paper program documents and no Conduit Investor shall have any obligation to  pay any amount required to be paid by it hereunder in excess of any amount received pursuant to this  Agreement or the Notes and available to such Conduit Investor after paying or making provision for the  payment of its commercial paper notes; provided, however, that each Committed Note Purchaser shall  pay any Conduit Investor Amounts, on behalf of any Conduit Investor in such Committed Note  Purchaser’s Investment Group, as and when due hereunder, to the extent that such Conduit Investor is  precluded by its commercial paper program documents from paying such Conduit Investor Amounts in  accordance with this Agreement.                       (d)  Notwithstanding any provisions contained in this Agreement to the  contrary, no Conduit Investor shall be obligated to pay any fees, costs, indemnified amounts or expenses  due pursuant to this Agreement other than in accordance with the order of priorities set out in such  Conduit Investor’s commercial paper program documents and all payment obligations of each Conduit  Investor hereunder are contingent on the availability of funds received pursuant to this Agreement or the  Notes and in excess of the amounts necessary to pay its commercial paper notes.  Any such amount which  any Conduit Investor does not pay pursuant to the operation of the preceding sentence shall not constitute  a claim against or corporate obligation of such Conduit Investor for any such insufficiency unless and  until funds received pursuant to this Agreement or the Notes and are available for the payment of such  amounts as aforesaid.                       (e)  The provisions of this Section 9.10 shall survive the termination of this  Agreement.                SECTION 9.11     Confidentiality. Each Investor, Funding Agent and the  Administrative Agent agrees that it shall not disclose any Confidential Information to any Person without  the prior written consent of the Property Manager and the Co-Issuers, other than (a) to their Affiliates, and  their Affiliates’ officers, directors, employees, managers, administrators, trustees, agents and advisors,  including, without limitation, legal counsel and accountants (it being understood that the Person to whom  such disclosure is made will be informed of the confidential nature of such Confidential Information and  instructed to keep it confidential), (b) to actual or prospective assignees and participants, and then only on  a confidential basis (after obtaining such actual or prospective assignee’s or participant’s agreement to  keep such Confidential Information confidential in a manner substantially similar to this Section 9.11),  (c) as requested by a Governmental Authority or self-regulatory organization or required by any law, rule  or regulation or judicial process of which the Co-Issuers or the Property Manager, as the case may be, has  knowledge; provided that each Investor, Funding Agent and the Administrative Agent may disclose  Confidential Information as requested by a Governmental Authority or self-regulatory organization or  required by any law, rule or regulation or judicial process of which the Co-Issuers or the Property  Manager, as the case may be, does not have knowledge if such Investor, Funding Agent or Administrative  Agent is prohibited by law, rule or regulation from disclosing such requirement to the Co-Issuers or the  Property Manager, as the case may be, (d) to (x) Program Support Providers and (y) any trustee or  collateral agent for the benefit of the holders of the commercial paper notes or other senior indebtedness  of a Conduit Investor appointed pursuant to such Conduit Investor’s program documents (after obtaining  such Person’s agreement to keep such Confidential Information confidential in a manner substantially  similar to this Section 9.11), (e) to any rating agency providing a rating for any Series or Class of Notes  or any Conduit Investor’s debt, (f) to any Person acting as a placement agent, dealer or investor with  respect to any Conduit Investor’s commercial paper (provided that any Confidential Information provided  to any such placement agent, dealer or investor does not reveal the identity of the Co-Issuers or any of  their Affiliates and is confined to information of the type that is typically provided to such entities by  asset-backed commercial paper conduits), or (g) in the course of litigation with the Co-Issuers or the  Property Manager.                                             50  DMSLIBRARY01\32647597  

 

                “Confidential Information” means information that any Co-Issuer or the Property  Manager furnishes to an Investor, but does not include (i) any such information that is or becomes  generally available to the public other than as a result of a disclosure in violation of this Section 9.11 or a  disclosure by a Person to which an Investor, a Funding Agent or the Administrative Agent delivered such  information, (ii) any such information that was in the possession of an Investor prior to its being furnished  to such Investor by the Co-Issuers or the Property Manager, or (iii) any such information that is or  becomes available to an Investor from a source other than a Co-Issuer or the Property Manager; provided  that with respect to clauses (ii) and (iii) herein, such source is not (x) known to an Investor to be bound by  a confidentiality agreement with a Co-Issuer or the Property Manager, as the case may be, with respect to  the information or (y) known to an Investor to be otherwise prohibited from transmitting the information  by a contractual, legal or fiduciary obligation.                SECTION 9.12     GOVERNING LAW; CONFLICTS WITH INDENTURE OR THE  SERIES 2018-1 SUPPLEMENT. THIS AGREEMENT AND ALL MATTERS ARISING UNDER  OR IN ANY MANNER RELATING TO THIS AGREEMENT SHALL BE GOVERNED BY AND  CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE  OF NEW YORK.  IN THE EVENT OF ANY CONFLICTS BETWEEN THIS AGREEMENT AND  THE INDENTURE OR THE SERIES 2018-1 SUPPLEMENT, THE INDENTURE OR THE  SERIES 2018-1 SUPPLEMENT, AS APPLICABLE, SHALL GOVERN.                SECTION 9.13     JURISDICTION. EACH OF THE PARTIES HERETO  IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY NEW YORK  STATE COURT OR UNITED STATES FEDERAL COURT SITTING IN THE BOROUGH OF  MANHATTAN, THE CITY OF NEW YORK IN RESPECT OF ANY SUIT, ACTION OR  PROCEEDING ARISING OUT OF OR IN RELATION TO THIS AGREEMENT.                SECTION 9.14     WAIVER OF JURY TRIAL. EACH OF THE PARTIES  HERETO WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY  AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF  OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED  HEREBY                SECTION 9.15     Counterparts. This Agreement may be executed in any number of  counterparts, each of which so executed shall be deemed to be an original, but all such respective  counterparts shall together constitute but one and the same instrument.  Delivery of an executed  counterpart of this Agreement in Portable Document Format (PDF) or by facsimile shall be effective as  delivery of a manually executed counterpart of this Indenture.                SECTION 9.16     Third Party Beneficiary. The Indenture Trustee is an express third  party beneficiary of this Agreement.                SECTION 9.17     Assignment.                       (a)  Subject to Sections 6.04 and 9.17(d), any Committed Note Purchaser may  at any time sell or assign all or any part of its rights and obligations under this Agreement, the Series  2018-1 Class A Notes and, in connection therewith, any other Transaction Documents to which it is a  party, with the prior written consent of the Co-Issuers to one or more financial institutions (an “Acquiring  Committed Note Purchaser”) pursuant to an assignment and assumption agreement, substantially in the  form of Exhibit B (the “Assignment and Assumption Agreement”), executed by such Acquiring  Committed Note Purchaser, such assigning Committed Note Purchaser, the Funding Agent with respect to  such assigning Committed Note Purchaser and the Co-Issuers and delivered to the Administrative Agent;                                             51  DMSLIBRARY01\32647597  

 

   provided, that no consent of the Co-Issuers will be required for an assignment in whole or in part to  another Series 2018-1 Class A Noteholder, an Affiliate of a Series 2018-1 Class A Noteholder, an Eligible  Assignee or if an Event of Default has occurred and is continuing; provided, further, that any such  assignment to an Eligible Assignee without the consent of the Co-Issuers shall be of Commitments in an  amount of at least $10 million.  An “Eligible Assignee” shall mean a financial institution that is rated at  least “BBB-” from S&P and/or has the equivalent rating of another “nationally-recognized statistical  rating organization” registered with the SEC as of the date of the assignment.                       (b)  Without limiting the foregoing, subject to Sections 6.04 and 9.17(d), each  Conduit Investor may assign all or a portion of the Investor Group Principal Amount with respect to such  Conduit Investor and its rights and obligations under this Agreement, the Series 2018-1 Class A Notes  and, in connection therewith, any other Transaction Documents to which it is a party to a Conduit  Assignee with respect to such Conduit Investor, without the prior written consent of the Co-Issuers. Upon  such assignment by a Conduit Investor to a Conduit Assignee, (i) such Conduit Assignee shall be the  owner of the Investor Group Principal Amount or such portion thereof with respect to such Conduit  Investor, (ii) the related administrative or managing agent for such Conduit Assignee will act as the  Funding Agent for such Conduit Assignee hereunder, with all corresponding rights and powers, express  or implied, granted to the Funding Agent hereunder or under the other Transaction Documents, (iii) such  Conduit Assignee and its liquidity support provider(s) and credit support provider(s) and other related  parties, in each case relating to the Commercial Paper and/or the Series 2018-1 Class A Notes, shall have  the benefit of all the rights and protections provided to such Conduit Investor herein and in the other  Transaction Documents (including, without limitation, any limitation on recourse against such Conduit  Assignee as provided in this paragraph), (iv) such Conduit Assignee shall assume all of such Conduit  Investor’s obligations, if any, hereunder or under the Indenture or under any other Transaction Document  with respect to such portion of the Investor Group Principal Amount and such Conduit Investor shall be  released from such obligations, (v) all distributions in respect of the Investor Group Principal Amount or  such portion thereof with respect to such Conduit Investor shall be made to the applicable Funding Agent  on behalf of such Conduit Assignee, (vi) the definition of the term “CP Funding Rate” with respect to the  portion of the Investor Group Principal Amount with respect to such Conduit Investor, as applicable,  funded or maintained with commercial paper issued by such Conduit Assignee from time to time shall be  determined in the manner set forth in the definition of “CP Funding Rate” applicable to such Conduit  Assignee on the basis of the interest rate or discount applicable to Commercial Paper issued by or for the  benefit of such Conduit Assignee (rather than any other Conduit Investor), (vii) the defined terms and  other terms and provisions of this Agreement and the other Transaction Documents shall be interpreted in  accordance with the foregoing, and (viii) if requested by the Funding Agent with respect to such Conduit  Assignee, the parties will execute and deliver such further agreements and documents and take such other  actions as the Funding Agent may reasonably request to evidence and give effect to the foregoing. No  assignment by any Conduit Investor to a Conduit Assignee of all or any portion of the Investor Group  Principal Amount with respect to such Conduit Investor shall in any way diminish the obligation of the  Committed Note Purchasers in the same Investor Group as such Conduit Investor under Section 2.03 to  fund any Borrowing not funded by such Conduit Investor or such Conduit Assignee.                       (c)  Subject to Sections 6.04 and 9.17(d), each Conduit Investor and the related  Committed Note Purchaser(s) may at any time sell all or any part of their respective rights and obligations  under this Agreement, the Series 2018-1 Class A Notes and, in connection therewith, any other  Transaction Documents to which it is a party, with the prior written consent (not to be unreasonably  withheld or delayed) of the Co-Issuers to a multi-seller commercial paper conduit, whose commercial  paper is rated at least “A” (or then equivalent grade) from S&P, and one or more financial institutions  providing support to such multi-seller commercial paper conduit (an “Acquiring Investor Group”)  pursuant to a transfer supplement, substantially in the form of Exhibit C (the “Investor Group  Supplement”), executed by such Acquiring Investor Group, the Funding Agent with respect to such                                             52  DMSLIBRARY01\32647597  

 

   Acquiring Investor Group (including the Conduit Investor and the Committed Note Purchasers with  respect to such Investor Group), such assigning Conduit Investor and the Committed Note Purchasers  with respect to such Conduit Investor, the Funding Agent with respect to such assigning Conduit Investor  and Committed Note Purchasers and the Co-Issuers and delivered to the Administrative Agent; provided  that no consent of the Co-Issuers shall be required for an assignment to another Committed Note  Purchaser or any Affiliate of a Committed Note Purchaser and its related Conduit Investor or if an Event  of Default has occurred and is continuing. For the avoidance of doubt, this Section 9.17(c) is intended to  permit and provide for (i) assignments from a Committed Note Purchaser to a Conduit Investor in a  different Investor Group and (ii) assignments from a Conduit Investor to a Committed Note Purchaser in  a different Investor group, and, in each of (i) and (ii), Exhibit C shall be revised to reflect such  assignments.                       (d)  [Reserved]                       (e)  [Reserved]                       (f)  Any assignment of the Series 2018-1 Class A Notes shall be made in  accordance with the applicable provisions of the Indenture and the Series 2018-1 Supplement.                  SECTION 9.18     Defaulting Investors.                        (a)  The Co-Issuers may, at their sole expense and effort, upon notice to such  Defaulting Investor and the Administrative Agent, (i) require any Defaulting Investor to sell all of its  rights, obligations and commitments under this Agreement, the Series 2018-1 Class A Notes and, in  connection therewith, any other Transaction Documents to which it is a party, to an assignee; provided  that (x) such assignment is made in compliance with Section 9.17 and (y) such Defaulting Investor shall  have received from such assignee an amount equal to such Defaulting Investor’s Committed Note  Purchaser Percentage of the related Investor Group Principal Amount of such Defaulting Investor and all  accrued interest thereon, accrued fees and all other amounts payable to such Defaulting Investor  hereunder or (ii) remove any Defaulting Investor as an Investor by paying to such Defaulting Investor an  amount equal to such Defaulting Investor’s Committed Note Purchaser Percentage of the related Investor  Group Principal Amount of such Defaulting Investor and all accrued interest thereon, accrued fees and all  other amounts payable to such Defaulting Investor hereunder.                       (b)  In the event that a Defaulting Investor desires to sell all or any portion of it  rights, obligations and commitments under this Agreement, the Series 2018-1 Class A Notes and, in  connection therewith, any other Transaction Documents to which it is a party, to an unaffiliated third  party assignee for an amount less than 100% (or, if only a portion of such rights, obligations and  commitments are proposed to be sold, such portion) of such Defaulting Investor’s Committed Note  Purchaser Percentage of the related Investor Group Principal Amount of such Defaulting Investor and all  accrued interest thereon, accrued fees and all other amounts payable to such Defaulting Investor  hereunder, such Defaulting Investor shall promptly notify the Co-Issuers of the proposed sale (the “Sale  Notice”). Each Sale Notice shall certify that such Defaulting Investor has received a firm offer from the  prospective unaffiliated third party and shall contain the material terms of the proposed sale, including,  without limitation, the purchase price of the proposed sale and the portion of such Defaulting Investor’s  rights, obligations and commitments proposed to be sold. The Co-Issuers and any of its Affiliates shall  have an option for a period of three (3) Business Days from the date the Sale Notice is given to elect to  purchase such rights, obligations and commitments at the same price and subject to the same material  terms as described in the Sale Notice.  The Co-Issuers or any of their respective Affiliates may exercise  such purchase option by notifying such Defaulting Investor before expiration of such three (3) Business  Days period that it wishes to purchase all (but not a portion) of the rights, obligations and commitments of                                             53  DMSLIBRARY01\32647597  

 

   such Defaulting Investor proposed to be sold to such unaffiliated third party. If the Co-Issuers or any of  their respective Affiliates gives notice to such Defaulting Investor that it desires to purchase such, rights,  obligations and commitments, the Co-Issuers or such Affiliate shall promptly pay the purchase price to  such Defaulting Investor. If the Co-Issuers or any of their respective Affiliates does not respond to any  Sale Notice within such three (3) Business Days period, the Co-Issuers and their respective Affiliates  shall be deemed not to have exercised such purchase option.                       (c)  Notwithstanding anything to the contrary contained in this Agreement, if  any Investor becomes a Defaulting Investor, then, until such time as such Investor is no longer a  Defaulting Investor, to the extent permitted by applicable law:                            (i)  Such Defaulting Investor’s right to approve or disapprove any         amendment, waiver or consent with respect to this Agreement shall be restricted as set forth in         Section 9.01.                           (ii)  Any payment of principal, interest, fees or other amounts payable to        the account of such Defaulting Investor (whether voluntary or mandatory, at maturity or        otherwise) shall be applied (and the Co-Issuers shall instruct the Indenture Trustee to apply such        amounts) as follows: first, to the payment on a pro rata basis of any amounts owing by such        Defaulting Investor to the Administrative Agent hereunder; second, as the Co-Issuers may request        (so long as no Default or Event of Default exists), to the funding of any Advance in respect of        which such Defaulting Investor has failed to fund its portion thereof as required by this        Agreement, as determined by the Administrative Agent; third, if so determined by the        Administrative Agent and the Co-Issuers, to be held in a deposit account and released pro rata in        order to satisfy such Defaulting Investor’s potential future funding obligations with respect to        Advances under this Agreement; fourth, to the payment of any amounts owing to the Investors as        a result of any judgment of a court of competent jurisdiction obtained by any Investor against        such Defaulting Investor as a result of such Defaulting Investor’s breach of its obligations under        this Agreement; fifth, so long as no Default or Event of Default exists, to the payment of any        amounts owing to the Co-Issuers as a result of any judgment of a court of competent jurisdiction        obtained by the Co-Issuers against such Defaulting Investor as a result of such Defaulting        Investor’s breach of its obligations under this Agreement; and sixth, to such Defaulting Investor        or as otherwise directed by a court of competent jurisdiction. Any payments, prepayments or        other amounts paid or payable to a Defaulting Investor that are applied (or held) to pay amounts        owed by a Defaulting Investor or to post cash collateral pursuant to this Section 9.18(c)(ii) shall        be deemed paid to and redirected by such Defaulting Investor, and each Investor irrevocably        consents hereto.                       (d)  If the Co-Issuers and the Administrative Agent (acting at the direction of  the Funding Agents) agree in writing that an Investor is no longer a Defaulting Investor, the  Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in  such notice and subject to any conditions set forth therein (which may include arrangements with respect  to any cash collateral), that Investor will, to the extent applicable, purchase that portion of outstanding  Advances of the other Investors or take such other actions as the Administrative Agent (acting at the  direction of the Funding Agents) may determine to be necessary to cause the Advances to be held pro rata  by the Investors in accordance with their respective Commitments (without giving effect to Section  9.18(c)(iii)), whereupon such Investor will cease to be a Defaulting Investor; provided that no adjustments  will be made retroactively with respect to fees accrued or payments made by or on behalf of the Co- Issuers while that Investor was a Defaulting Investor; and provided, further, that except to the extent  otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Investor to                                              54  DMSLIBRARY01\32647597  

 

   Investor will constitute a waiver or release of any claim of any party hereunder arising from that  Investor’s having been a Defaulting Investor.                SECTION 9.19     No Fiduciary Duties.  Each of the Property Manager and the Co- Issuers acknowledge and agree that in connection with the transaction contemplated in this Agreement, or  any other services the Investors may be deemed to be providing hereunder, notwithstanding any  preexisting relationship, advisory or otherwise, between the parties or any oral representations or  assurances previously or subsequently made by the Investors: (a) no fiduciary or agency relationship  between any of the Property Manager, the Co-Issuers and any other person, on the one hand, and the  Investors or any of its Affiliates (or any agent, adviser or representative of any of the foregoing), on the  other, exists; (b) the Investors are not acting as advisor, expert or otherwise, to the Property Manager or  the Co-Issuers, and such relationship between any of the Property Manager or the Co-Issuers, on the one  hand, and the Investors or any of its respective affiliates (or any agent, adviser or representative of any of  the foregoing), on the other, is entirely and solely commercial, based on arms-length negotiations; (c) any  duties and obligations that the Investors may have to the Property Manager and any of the Co-Issuers  shall be limited to those duties and obligations specifically stated herein; (d) the Investors and its  respective affiliates (or any agent, adviser or representative of any of the foregoing) may have interests  that differ from those of the Property Manager or any of the Co-Issuers; and (e) the Property Manager and  the Co-Issuers have consulted their own legal and financial advisors to the extent they deemed  appropriate. Each of the Property Manager and the Co-Issuers hereby waive any claims that Property  Manager or the Co-Issuer may have against the Investors with respect to any breach of fiduciary duty in  connection with the Series 2018-1 Class A Notes.                SECTION 9.20     No Guarantee by the Parent or the Property Manager.  The execution  and delivery of this Agreement by the Parent and the Property Manager shall not be construed as a  guarantee or other credit support by the Parent or the Property Manager of the obligations of the Co- Issuers hereunder.  Neither the Parent nor the Property Manager shall be liable in any respect for any  obligation of the Co-Issuers hereunder or any violation by any Co-Issuer of its covenants, representations  and warranties or other agreements and obligations hereunder.                SECTION 9.21     Term; Termination of Agreement.  This Agreement shall terminate  upon the earliest to occur of (x) the permanent reduction of the Series 2018-1 Class A Notes Maximum  Principal Amount to zero in accordance with Section 2.05(a) and payment in full of all monetary  obligations in respect of the Series 2018-1 Class A Notes, (y) the payment in full of all monetary  obligations in respect of the Series 2018-1 Class A Notes on or after the Series 2018-1 Class A  Anticipated Repayment Date and (z) the satisfaction and discharge of the Indenture and the Series 2018-1  Supplement pursuant to Article 9 of the Indenture.                SECTION 9.22     Acknowledgement and Consent to Bail-In of EEA Financial  Institutions.  Notwithstanding anything to the contrary in any Transaction Document or in any other  agreement, arrangement or understanding among any such parties, each party hereto acknowledges that  any liability of any EEA Financial Institution arising under any Transaction Document, to the extent such  liability is unsecured, may be subject to the write-down and conversion powers of an EEA Resolution  Authority and agrees and consents to, and acknowledges and agrees to be bound by:                       (a)  the application of any Write-Down and Conversion Powers by an EEA  Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party  hereto that is an EEA Financial Institution; and                       (b)  the effects of any Bail-In Action or any such liability, including, if  applicable:                                             55  DMSLIBRARY01\32647597  

 

                            (i)  a reduction in full or in part or cancellation of any such liability;                           (ii)  a conversion of all, or a portion of, such liability into shares or other        instruments of ownership in such EEA Financial Institution, its parent undertaking, or a bridge        institution that may be issued to it or otherwise conferred on it, and that such shares or other        instruments of ownership will be accepted by it in lieu of any rights with respect to any such        liability under this Agreement or any other Transaction Document; or                           (iii)  the variation of the terms of such liability in connection with the        exercise of the write-down and conversion powers of any EEA Resolution Authority.         For purposes of this Section 9.22:                “Bail-In Legislation” means in relation to an EEA Member Country which has        implemented, or which at any time implements, Article 55 of Directive 2014/59/EU establishing        a framework for the recovery and resolution of credit institutions and investment firms, the        relevant implementing law or regulation as described in the EU Bail-In Legislation Schedule        from time to time.                “EEA Member Country” means any member state of the European Union, Iceland,        Liechtenstein and Norway.                “EU Bail-In Legislation Schedule” means the document described as such and published        by the Loan Market Association (or any successor person) from time to time.                 “Resolution Authority” means any legal body which has authority to exercise any Write-       down and Conversion Powers.                 “Write-down and Conversion Powers” means in relation to any Bail-In Legislation        described in the EU Bail-In Legislation Schedule from time to time, the powers described as such        in relation to that Bail-In Legislation in the EU Bail-In Legislation Schedule.                SECTION 9.23     Joint and Several Obligations of the Co-Issuers; Designation of  Property Manager as Representative and Agent.                         (a)  Each Co-Issuer agrees that it is jointly and severally liable for, and  absolutely and unconditionally guarantees to each Investor, each Funding Agent and the Administrative  Agent the prompt payment of all obligations under the Series 2018-1 Class A Notes and all other amounts  owed by any Co-Issuer hereunder to each Investor, each Funding Agent and the Administrative Agent,  and the prompt performance of all agreements under the Transaction Documents.                       (b)  The Co-Issuers hereby designate the Property Manager as their  representative and agent on its behalf for the purposes of issuing requests for Borrowing and giving  instructions with respect to the disbursement of the proceeds of the Advances (and such proceeds may be  advanced hereunder at such direction), giving and receiving all other notices and consents hereunder or  under any of the Series 2018-1 Class A Notes and taking all other actions (including in respect of  compliance with covenants) on behalf of the Co-Issuers hereunder or under any Series 2018-1 Class A  Notes.  The Property Manager hereby accepts such appointment.  Each Investor, each Funding Agent and  the Administrative Agent may regard any notice or other communication pursuant to any Transaction  Document from the Property Manager as a notice or communication from the Co-Issuers, and may give  any notice or communication required or permitted to be given to the Co-Issuers hereunder to the                                             56  DMSLIBRARY01\32647597  

 

   Property Manager on behalf of the Co-Issuers.  The Co-Issuers agrees that each notice, election,  representation and warranty, covenant, agreement and undertaking made on its behalf by the Property  Manager will be deemed for all purposes to have been made by the Co-Issuers and shall be binding upon  and enforceable against the Co-Issuers to the same extent as if the same had been made directly by the  Co-Issuers.                SECTION 9.24     Patriot Act.  In accordance with the USA PATRIOT Act, to help  fight the funding of terrorism and money laundering activities, any Investor may obtain, verify and record  information that identifies individuals or entities that establish a relationship with such Investor. Such  Investor may ask for the name, address, tax identification number and other information that will allow it  to identify the individual or entity who is establishing the relationship or opening the account. Such  Investor may also ask for formation documents such as articles of incorporation, an offering  memorandum, or other identifying documents to be provided.                   [REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]                                              57  DMSLIBRARY01\32647597  

 

               IN WITNESS    WHEREOF,    the parties hereto have caused this Agreement to be duly  executed by their duly authorized officers and delivered as of the day and year first above written.                                                      SPIRIT MASTER FUNDING, LLC,                                                     as Co-Issuer                                                         By: SMTA   SPE Manager, LLC, its                                                     manager                                                      By:                                                         Name:  Rica=~:;gue,                                                             Title: Authorized Signatory                                                      SPIRIT MASTER FUNDING II, LLC,                                                     as Co-Issuer                                                         By: SMTA SPE Manager, LLC, its                                                     manager                                                      By: Name   ~;Jte,                                                         Title: Authorized Signatory                                                      SPIRIT MASTER FUNDING III, LLC,                                                     as Co-Issuer                                                         By: SMTA   SPE Manager, LLC, its                                                     manager                                                      By: ---~=:::::i:=---------­                                                        Name: Ricardo   odriguez                                                         Title: Authorized Signatory                                                      SPIRIT MASTER FUNDING VI, LLC,                                                     as Co-Issuer                                                         By: SMTA SPE Manager, LLC, its                                                     manager                                                      By:                                                            Nam~          Rodrigue,                                                            Title: Authorized Signatory                    Signature Page to Class A Note Purchase Agreement (Series 2018-1 Class A)  

 

                                SPIRIT MASTER FUNDING VIII, LLC,                                  as Co-Issuer                                      By: SMTA SPE Manager, LLC, its                                  manager                                    By,                                         Name~Ri~~~     driguez                                          Title: Authorized Signatory    Signature Page to Class A Note Purchase Agreement (Series 2018-1 Class A)  

 

                                   SPIRIT MTA   REIT,                                     as Parent                                         By: Spirit MTA  OP Holdings, LLC, its                                     manager                                     By: Name,  Ric:JifL                                          Title: Chief Executive Officer, President,                                               Chief Financial Officer and Treasurer    Signature Page to Class A Note Purchase Agreement (Series 2018-1 Class A)  

 

                                   SPIRIT REALTY,   L.P .,                                     as Property Manager                                         By: Spirit General OP Holdings,   its                                     manager                                           Name: Michael Hughes                                         Title: Executive Vice President, Chief                                               Financial Officer and Treasurer                                      The Co-Issuers, the Support Provider and the                                     Property Manager at the following address:                                      2727 N. Harwood Street                                     Ste 300                                     Dallas, TX 75201    Signature Page to Class A Note Purchase Agreement (Series 2018-1 Class A)  

 

By:           arne:          Title:   Chi                     Signature Page to Class A ote Purchase Agreement (Seri es 2018-1 Class A)  

 

                                    BARCLAYS     BA   K PLC,                                               ame:    Chi   -  ong Choe                                           Title:            irector                                       BA  RCLAYS   BANK PLC                                             Name:                                           Title:    Signature Page to Class A ote Purchase Agreement (Series 2018- 1 Class A)  

 

                                               Na me:                                                 Title:    Signature Page to Class A   ote Purchase Agreement (Series 20 I 8- I Class A)  

 

                                                                SCHEDULE I TO CLASS A                                                          NOTE PURCHASE AGREEMENT                         INVESTOR GROUPS AND COMMITMENTS         Investor       Maximum Investor        Conduit      Committed Note     Commitment    Group/Funding        Group Principal   Investor (if any) Purchaser(s)        Amount         Agent              Amount                                                     Barclays Bank PLC    $50,000,000         Sheffield       Barclays Bank PLC    $50,000,000                                           Receivables                                           Company LLC                                                 Schedule I-1     DMSLIBRARY01\32647597  

 

                                                                SCHEDULE II TO CLASS A                                                         NOTE PURCHASE AGREEMENT                 NOTICE ADDRESSES FOR LENDER PARTIES AND AGENTS                                       Conduit Investor   Sheffield Receivables Company LLC    Sheffield Receivables Company LLC  745 Seventh Avenue, 5th Floor  New York, New York 10019  Attention: Chin-Yong Choe  Telephone: 212-528-8159  Email: BarCapConduitOps@barclays.com; ASGReports@barclays.com; chin-yong.choe@barclays.com;  peter.walgren@barclays.com; tara.chick@barclays.com                                    Committed Note Purchaser  Barclays Bank PLC    Barclays Bank PLC  745 Seventh Avenue, 5th Floor  New York, New York 10019  Attention: Chin-Yong Choe  Telephone: 212-528-8159  Email: BarCapConduitOps@barclays.com; ASGReports@barclays.com; chin-yong.choe@barclays.com;  peter.walgren@barclays.com; tara.chick@barclays.com                                                Schedule II-1     DMSLIBRARY01\32647597  

 

                                         Funding Agent    Barclays Bank PLC    Barclays Bank PLC  745 Seventh Avenue, 5th Floor  New York, New York 10019  Attention: Chin-Yong Choe  Telephone: 212-528-8159  Email: BarCapConduitOps@barclays.com; ASGReports@barclays.com; chin-yong.choe@barclays.com;  peter.walgren@barclays.com; tara.chick@barclays.com                                                                                              Schedule II-2     DMSLIBRARY01\32647597  

 

                                     Administrative Agent      Barclays Bank PLC    Barclays Bank PLC  745 Seventh Avenue, 5th Floor  New York, New York 10019  Attention: Chin-Yong Choe  Telephone: 212-528-8159  Email: BarCapConduitOps@barclays.com; ASGReports@barclays.com; chin-yong.choe@barclays.com;  peter.walgren@barclays.com; tara.chick@barclays.com                                                                Schedule II-3     DMSLIBRARY01\32647597  

 

                                                               SCHEDULE III TO CLASS A                                                         NOTE PURCHASE AGREEMENT                            ADDITIONAL CLOSING CONDITIONS   The following are the additional conditions to initial issuance and effectiveness referred to in Section  7.01(c):         (a)    All corporate proceedings and other legal matters incident to the authorization, form and  validity of each of the Transaction Documents, and all other legal matters relating to the Transaction  Documents and the transactions contemplated thereby, shall be reasonably satisfactory in all material  respects to the Administrative Agent, Co-Issuers, the Property Manager and the Parent shall have  furnished to the Funding Agent all documents and information that the Funding Agents or their counsel  may reasonably request to enable them to pass upon such matters.          (b)   Richards, Layton & Finger, P.A., as Delaware counsel to the Co-Issuers and the Property  Manager, shall have furnished to the Administrative Agent and the Investors written opinions that are  customary for transactions of this type, including with respect to certain corporate matters and the  applicability of Delaware law to the determination of what persons have the authority to file a voluntary  bankruptcy petition on behalf of the Co-Issuers, and reasonably satisfactory in form and substance to  counsel to the Funding Agent, addressed to the Funding Agent, the Administrative Agent and Investors  and dated the Series 2018-1 Closing Date.          (c)   Latham & Watkins LLP, as counsel to the Co-Issuers, the Property Manager and the  Parent, shall have furnished to the Funding Agent, the Administrative Agent and the Investors written  opinions (or a reaffirmation of the opinion or opinions of Latham & Watkins LLP covering the same  matters) that are customary for transactions of this type, and including with respect to certain corporate,  securities and investment company act matters, security interest matters, “non-consolidation” matters and  tax matters, and in each case reasonably satisfactory in form and substance to counsel to the Funding  Agent, addressed to the Funding Agent and the Administrative Agent and Investors and dated the Series  2018-1 Closing Date.            (d)   Dentons US LLP, as counsel to the Indenture Trustee, shall have furnished to the  Administrative Agent and the Investors written opinions that are customary for transactions of this type,  reasonably satisfactory in form and substance to counsel to the Funding Agent, addressed to the Funding  Agent and the Administrative Agent and Investors and dated the Series 2018-1 Closing Date.          (e)   In-house counsel of the Co-Issuers and the Parent shall have furnished or caused to be  furnished to the Administrative Agent and the Investors written opinions that are customary for  transactions of this type, reasonably satisfactory in form and substance to the Funding Agent, addressed to  the Funding Agent and the Administrative Agent and Investors and dated the Series 2018-1 Closing Date.           (f)   Each of the Co-Issuers, the Parent and the Property Manager, as applicable, shall have  furnished or caused to be furnished to the Funding Agent a certificate signed by two managers, officers or  other authorized signatory of the Co-Issuers, the Parent and the Property Manager, as applicable, or other  officers reasonably satisfactory to the Funding Agents, dated as of the Series 2018-1 Closing Date, as to  such matters as the Funding Agents may reasonably request, including, without limitation, a statement  that:                (i)     the representations, warranties and agreements of the Co-Issuers, the Parent and                      the Property Manager, as applicable, in any other Transaction Document to                                         Schedule III-1     DMSLIBRARY01\32647597  

 

                       which any of the Co-Issuers, the Parent and the Property Manager, as applicable,                      is a party are true and correct (A) if qualified as to materiality, in all respects, and                      (B) if not so qualified, in all material respects, on and as of the Series 2018-1                      Closing Date (unless stated to relate solely to an earlier date, in which case such                      representations and warranties shall be true and correct (x) if qualified as to                      materiality, in all respects, and (y) if not so qualified, in all material respects, as                      of such earlier date), and the Co-Issuers, the Parent and the Property Manager, as                      applicable, has complied in all material respects with all its agreements contained                      herein and in any other Transaction Document to which it is a party and satisfied                      all the conditions on its part to be performed or satisfied hereunder or thereunder                      at or prior to the Series 2018-1 Closing Date and                (ii)   in the case of the Co-Issuers and the Property Manager, there shall exist at and as                      of the Series 2018-1 Closing Date no condition that would constitute an “Event                      of Default” (or an event that with notice or the lapse of time, or both, would                      constitute an “Event of Default”) under, and as defined in, the Indenture.         (g)    The Property Manager and the Co-Issuers shall have executed and delivered an  amendment to the Property Management Agreement, and the Funding Agent shall have received a duly  executed copy thereof.         (h)    The Property Manager, the Co-Issuers and the Back-Up Manager shall have executed and  delivered the Property Management Agreement, and the Funding Agent shall have received a duly  executed copy thereof.         (i)    The Co-Issuers and the Indenture Trustee shall have executed and delivered the  Indenture, and the Funding Agent shall have received a duly executed copy thereof.          (j)    The Series 2018-1 Supplement shall have been duly executed and delivered by the Co- Issuers and the Indenture Trustee.         (k)    The Series 2018-1 Class A Notes shall have been duly executed and delivered by the Co- Issuers and duly authenticated by the Indenture Trustee, and the Funding Agent shall have received duly  executed copies thereof.         (l)    Each other Transaction Documents (excluding any Series Supplements and other  Transaction Documents relating solely to a Series other than the Series 2018-1 Notes) shall have been  duly executed and delivered by the respective parties thereto, and the Funding Agent shall have received  duly executed copies thereof.         (m)    Each of the Transaction Documents shall be in full force and effect.         (n)    The Co-Issuers shall have furnished to the Funding Agent a certificate, in form and  substance reasonably satisfactory to the Funding Agent and dated as of the Series 2018-1 Closing Date, of  an authorized signatory of such entity (or other officers reasonably satisfactory to the Funding Agent) that  such entity will be Solvent (as defined below) immediately after the consummation of the transactions  contemplated by this Agreement.  As used herein, “Solvent” means, with respect to a particular date, that  on such date (i) the present fair market value (or present fair saleable value) of the assets of the relevant  entity are not less than the total amount required to pay the probable liabilities of such entity on its total  existing debts and liabilities (including contingent liabilities) as they become absolute and matured, (ii)  the relevant entity is able to realize upon its assets and pay its debts and other liabilities, contingent  obligations and commitments as they mature and become due in the normal course of business, (iii)                                        Schedule III-2     DMSLIBRARY01\32647597  

 

   assuming the completion of the transactions contemplated by the Transaction Documents, the relevant  entity is not incurring debts or liabilities beyond its ability to pay as such debts and liabilities mature, (iv)  the relevant entity is not engaged in any business or transaction, and is not about to engage in any  business or transaction, for which its property would constitute unreasonably small capital after giving  due consideration to the prevailing practice in the industry in which such entity is engaged, and (v) the  relevant entity is not a defendant in any civil action that would reasonably be likely to result in a  judgment that such entity is or would become unable to satisfy.  In computing the amount of such  contingent liabilities at any time, it is intended that such liabilities will be computed at the amount that, in  the light of all the facts and circumstances existing at such time, represents the amount that can  reasonably be expected to become an actual or matured liability.          (o)   None of the transactions contemplated by this Agreement shall be subject to an injunction  (temporary or permanent) and no restraining order or other injunctive order shall have been issued; and  there shall not have been any legal action, order, decree or other administrative proceeding instituted or  (to the knowledge of the Co-Issuers or the Property Manager) overtly threatened against the Co-Issuers,  the Property Manager or the Parent that would reasonably be expected to adversely impact the issuance of  the Series 2018-1 Notes or any other transactions contemplated by the Transaction Documents.          (p)   The representations and warranties of each of the Co-Issuers, the Property Manager and  the Parent contained in the Transaction Documents to which it is a party will be true and correct (i) if  qualified as to materiality, in all respects, and (ii) if not so qualified, in all material respects, as of the  Series 2018-1 Closing Date (unless stated to relate solely to an earlier date, in which case such  representations and warranties shall be true and correct (x) if qualified as to materiality, in all respects,  and (y) if not so qualified, in all material respects, as of such earlier date).          (q)   On or prior to the Series 2018-1 Closing Date, the Co-Issuers, the Property Manager and  the Parent shall have furnished to the Funding Agent and the Investors such further certificates and  documents as the Funding Agent or any Investor may reasonably request.          All opinions, letters, evidence and certificates mentioned above or elsewhere in this Agreement  shall be deemed to be in compliance with the provisions hereof only if they are in form and substance  reasonably satisfactory to counsel for the Funding Agent.                                          Schedule III-3     DMSLIBRARY01\32647597  

 

                                                               SCHEDULE IV TO CLASS A                                                         NOTE PURCHASE AGREEMENT                            U.S. RISK RETENTION DISCLOSURE   I.     U.S. Risk Retention Disclosure on or prior to the Series 2018-1 Closing Date.   The Parent hereby makes the following disclosure to the Series 2018-1 Class A Noteholders as of the date  hereof pursuant to Regulation RR, 17 C.F.R. Part 246 (the “U.S. Risk Retention Rules”):      A.  The Parent to Hold an Eligible Horizontal Residual Interest.         The U.S. Risk Retention Rules require the “sponsor” of a “securitization transaction” (or a  “majority-owned affiliate” of the sponsor) (each as defined in the U.S. Risk Retention Rules) to retain an  economic interest in the credit risk of securitized assets in accordance with the requirements of the U.S.  Risk Retention Rules. To comply with the U.S. Risk Retention Rules, the Parent, as sponsor of the  securitization transaction involving the Series 2018-1 Class A Notes, will have on its behalf, SMTA  Financing JV, LLC, a majority-owned affiliate of Parent, retain an “eligible horizontal residual interest”  (as defined in the U.S. Risk Retention Rules, an “EHRI”) in the form of 100% of the limited liability  company interests in the Co-Issuers (such limited liability company interests, the “Retained Interest”). An  EHRI is defined under the U.S. Risk Retention Rules as, with respect to any securitization transaction, an  ABS interest in the issuing entity: (1) that is an interest in a single class or multiple classes in the issuing  entity, provided that each interest meets, individually or in the aggregate, all of the requirements of this  definition; (2) with respect to which, on any payment date or allocation date on which the issuing entity  has insufficient funds to satisfy its obligation to pay all contractual interest or principal due, any resulting  shortfall will reduce amounts payable to the eligible horizontal residual interest prior to any reduction in  the amounts payable to any other ABS interest, whether through loss allocation, operation of the priority  of payments, or any other governing contractual provision (until the amount of such ABS interest is  reduced to zero); and (3) that, with the exception of any non-economic REMIC (as defined in 26 U.S.C.  860D) residual interest, has the most subordinated claim to payments of both principal and interest by the  issuing entity.          An “ABS Interest” is defined under the U.S. Risk Retention Rules as: (1) any type of interest or  obligation issued by an issuing entity, whether or not in certificated form, including a security, obligation,  beneficial interest or residual interest (other than (i) a non-economic residual interest issued by a REMIC  or (ii) an uncertificated regular interest in a REMIC that is held by another REMIC, where both REMICs  are part of the same structure and a single REMIC in that structure issues ABS interests to investors),  payments on which are primarily dependent on the cash flows of the collateral owned or held by the  issuing entity; and (2) does not include common or preferred stock, limited liability interests, partnership  interests, trust certificates, or similar interests that: (i) are issued primarily to evidence ownership of the  issuing entity; and (ii) the payments, if any, on which are not primarily dependent on the cash flows of the  collateral held by the issuing entity; and (3) does not include the right to receive payments for services  provided by the holder of such right, including servicing, trustee services and custodial services.          Under the U.S. Risk Retention Rules, the EHRI must have a fair value equal to at least 5% of the  fair value of all ABS interests in the Co-Issuers issued as part of the securitization transaction. Such fair  value is determined as of the closing date for the securitization transaction using a fair value measurement  framework under GAAP. The Co-Issuers’ ABS interests issued as part of the Co-Issuers’ securitization  transaction contemplated by the Transaction Documents are (i) the Series 2018-1 Notes and (ii) all  Related Series Notes.                                          Schedule IV-1     DMSLIBRARY01\32647597  

 

         SMTA Financing JV, LLC is a direct and indirect wholly-owned subsidiary of the Parent, and  thus is a majority-owned affiliate under the U.S. Risk Retention Rules. Under the U.S. Risk Retention  Rules, the sponsor (or a majority-owned affiliate of the sponsor) is required to retain the EHRI until the  latest of (i) the second anniversary of the Closing Date, (ii) the date on which the total unpaid principal  balance (if applicable) of the securitized assets that collateralize this securitization transaction has been  reduced to 33% of the total unpaid principal balance of such securitized assets as of the Statistical  Disclosure Date, and (iii) the date the Series 2018-1 Class A Notes Maximum Principal Amount has been  reduced to 33% or less of the Series 2018-1 Class A Notes Maximum Principal Amount. None of the  sponsor or any of its majority-owned affiliates may sell, transfer, hedge or pledge the EHRI during this  period other than as permitted by the U.S. Risk Retention Rules.          As the holder of the Retained Interest, SMTA Financing JV, LLC will have the ability to receive  all funds available to the Co-Issuers not needed to make payments on the Series 2018-1 Notes or to pay  other expenses with respect to the Collateral Pool and this securitization transaction, and will not receive  any payments in respect of the Retained Interest on any Payment Date on which the Co-Issuers have  insufficient funds to satisfy in full all of its other obligations payable on such Payment Date, including all  interest and principal owing in respect of the Series 2018-1 Notes on such Payment Date.  The payments  available to SMTA Financing JV, LLC through the Retained Interest will be primarily dependent on the  cash flows of the collateral pledged to secure the Notes.            As described more fully below, the fair value of the Retained Interest on the Closing Date will be  at least 5% of the fair value of all ABS interests of the Co-Issuers are issued as part of the securitization  transaction involving the issuance of the Series 2018-1 Notes on the Closing Date.       B.  Terms of the Retained Interest.         SMTA Financing JV, LLC as a majority-owned affiliate of the Parent, will hold the Retained  Interest on behalf of the Parent. The Retained Interest will represent the right to receive certain  distributions of funds from the Co-Issuers not otherwise needed to make payments or deposits under the  Transaction Documents.  Distributions on the Retained Interest will depend primarily on the net cash  flows of the collateral available to the Co-Issuers. Because the Retained Interest will be subordinated to  each Class of Notes in accordance with Section 2.11 of the Indenture and will be entitled only to amounts  not needed to make payments or deposits under the Transaction Documents on each Payment Date, the  Retained Interest will absorb any losses on the Collateral prior to any other ABS interest issued by the  Co-Issuers, including the Notes.  In order to comply with the U.S. Risk Retention Rules, SMTA  Financing JV, LLC will hold the entire Retained Interest on the Closing Date and will continue to hold  such Retained Interest on an ongoing basis for so long as required by the U.S. Risk Retention  Regulations.         As indirect holder of the Retained Interest, the Parent will have the right to direct the Co-Issuers  in accordance with the terms of the Co-Issuers’ limited liability company agreement, including by  appointing the directors of the Co-Issuers.  Further, in accordance with the terms of the Co-Issuers’  limited liability company agreement, neither SMTA Financing JV, LLC nor the Parent will be required to  make any additional capital contributions to the Co-Issuers; provided, however, that the Parent may make  additional capital contributions to the Co-Issuers at any time.        C. Fair Value of ABS interests, Key Inputs and Assumptions and Valuation Methodology.         The fair value of all of the ABS interests of the Co-Issuers issued as part of the Co-Issuers’  securitization transaction involving the issuance of the Series 2018-1 Class A Notes is determined using a  GAAP fair value measurement framework with both observable and unobservable inputs. Under GAAP,                                         Schedule IV-2     DMSLIBRARY01\32647597  

 

   the significance of inputs in measuring fair value are reflected in a hierarchy, with Level 1 inputs favored  over Level 2 inputs and Level 2 inputs favored over Level 3 inputs.            Level 1 inputs include quoted prices for identical instruments and are the most observable,           Level 2 inputs include quoted prices for similar instruments and observable inputs such as            interest rates and yield curves, and           Level 3 inputs include data not observable in the market and reflect management judgment            about the assumptions market participants would use in pricing the instrument.                     The pre-closing determination of the fair value of the Series 2018-1 Notes is categorized within  Level 2 of the hierarchy, reflecting observable inputs such as yield rates. The post-closing determination  of the fair value of the Series 2018-1 Notes will be categorized within Level 1 of the hierarchy. The fair  value of the Retained Interest is categorized within Level 3 of the hierarchy, as many of the inputs to the  fair value calculation for the Retained Interest are generally not observable.          In determining the fair value of the ABS interests of the Co-Issuers, the Parent and the Co-Issuers  used the inputs and assumptions set forth below, which are intended solely for the purpose of determining  these fair values in accordance with the requirements of the U.S. Risk Retention Rules, and should not be  relied upon by investors for any other purpose:               the Series 2018-1 Class A Notes Maximum Principal Amount will be $50,000,000;              the full amount of the Series 2018-1 Class A Note Notes Maximum Principal Amount is               drawn and outstanding as of the Closing Date in accordance with the terms of the               Indenture and the Class A Note Purchase Agreement (other than any limitations that               would not allow the Co-Issuers to draw the full amount of the Class A Notes Maximum               Principal Amount on the Closing Date);               the fair value of the Aggregate Note Principal Balance of each Class of Notes (other than               the Series 2018-1 Notes) expected to be outstanding as of the Series 2018-1 Closing Date               is $1,947,078,284 as of the Determination Date in October 2018. The fair value of each               Class of Notes (other than the Series 2018-1 Notes) reflects a determination by the               sponsor and the Issuer, using marks and input on such Notes provided by market               participants in the Notes, of the price a third-party investor would pay to purchase, on the               Series 2018-1 Closing Date, such Notes;              the fair value of the Closing Date Collateral Pool is equal to the aggregate Appraised               Value thereof as of the Determination Date in October 2018, which is $2,637,246,675.               The fair value of the Closing Date Collateral Pool reflects a determination by an               independent, third-party appraiser of the value of the Mortgage Loans, Mortgaged               Property and related Tenant Leases, taking into consideration, among other things, the               cash flows, default rates, payment rate, upcoming terminations and other attributes of the               assets;              the fair value of the Aggregate Note Principal Balance of each Class of Notes (other than               the Series 2018-1 Notes) expected to be outstanding as of the Series 2018-1 Closing Date               and the fair value of the Closing Date Collateral Pool on the Series 2018-1 Closing Date               is equal to their respective fair values as of the Determination Date in October 2018;              the fair value of the Retained Interest is equal to the aggregate Appraised Value less the               fair value of the Aggregate Outstanding Notes as of the Series 2018-1 Closing Date;              the Issuers will not have any material assets other than the Collateral; and              other than the Notes and the Related Series Notes, the Co-Issuers will not have any               indebtedness.                                          Schedule IV-3     DMSLIBRARY01\32647597  

 

          Based on the foregoing inputs and assumptions, the Series 2018-1 Notes will have an aggregate  fair value of $50,000,000 on the Closing Date. Based on the foregoing, the EHRI (as represented by the  Retained Interest) will have a fair value equal to the fair value of the Closing Date Mortgage Loans and  the related Tenant Leases (or $2,637,246,675) less the fair value of the Aggregate Outstanding Notes  (including the Series 2018-1 Notes) as of the Closing Date (or, $1,997,078,284), or $640,168,391 on the  Closing Date. As such, the fair value of the Retained Interest, expressed as a percentage of the fair value  of all ABS interests of the Co-Issuers issued as part of the securitization transaction, will be  approximately 32.1%. The fair value of the EHRI is required to be at least 5% of the fair value of all ABS  interests of the Co-Issuers issued as part of the securitization transaction involving the issuance of the  Series 2018-1 Notes.   II.   U.S. Risk Retention Disclosure following the Series 2018-1 Closing Date.   The Parent shall make (or cause to have been made) the following disclosure in the first Monthly Report  to be delivered following the Series 2018-1 Closing Date as the same shall be set forth in the first  Indenture Trustee Report to be delivered to the Series 2018-1 Class A Noteholders pursuant to the  Indenture following the Series 2018-1 Closing Date:                       (a)  if different from the fair value disclosure above, the fair value on the  Series 2018-1 Closing Date (expressed as a percentage of the fair value of all of the “ABS interests” (as  defined in the U.S. Risk Retention Rules) in the Co-Issuers issued as part of the securitization transaction  contemplated by the Transaction Documents and as a dollar amount) of the Retained Interest based on  actual sale prices and finalized sizes of the Series 2018-1 Notes;                        (b)  the fair value on the Series 2018-1 Closing Date (expressed as a  percentage of the fair value of all of the ABS interests of the Co-Issuers issued as part of the securitization  transaction contemplated by the Transaction Documents and as a dollar amount) of the Retained Interest  that the sponsor (or majority-owned affiliate of the sponsor) is required to retain, as set forth above; and                        (c)  to the extent the valuation methodology or any of the key inputs and  assumptions that were used in calculating the fair value or range of fair values disclosed herein materially  differs from the methodology or key inputs and assumptions used to calculate the fair value as of the  Series 2018-1 Closing Date as set forth in such Monthly Report as the same shall be set forth in such  Indenture Trustee Report, descriptions of those material differences.                                                                 Schedule IV-4     DMSLIBRARY01\32647597  

 

                                                                SCHEDULE V TO CLASS A                                                         NOTE PURCHASE AGREEMENT                            E.U. RISK RETENTION DISCLOSURE   Spirit MTA REIT shall make the following disclosures (i) by an electronic mail to the Indenture Trustee  in the manner set forth in the Indenture at least two (2) Business Days prior to the date of delivery of each  Indenture Trustee Report under the Indenture in order to permit the Indenture Trustee to confirm that the  disclosures have been made in the Indenture Trustee Report to be made available to the Series 2018-1  Class A Noteholders on a monthly basis, (ii) promptly following the occurrence and continuation of an  Event of Default and (iii) promptly following written request by any Series 2018-1 Class A Noteholder  following a material change in the performance of the Collateral underlying the Series 2018-1 Class A  Notes or material breach to the Transaction Documents as determined by such Series 2018-1 Class A  Noteholder:         (a)    that Spirit MTA REIT believes that it should qualify as an originator as defined in               Regulation (EU) No. 575/2013 (the “E.U. Capital Requirements Regulation”) for the               purposes of the securitization transaction contemplated by the Transaction Documents on               the basis that it has, either itself or through related entities, been involved in the original               negotiation of a proportion of the portfolio of Tenant Leases held by Spirit MTA REIT as               of the Series 2018-1 Closing Date;         (b)    that Spirit MTA REIT continues to retain, on an ongoing basis, a material net economic               interest of not less than 5% of the securitisation by (i) retaining indirectly 100% of the               limited liability company interest in SMTA Financing JV, LLC; and (ii) causing SMTA               Financing JV, LLC to directly retain 100% of the limited liability company interests in               the Co-Issuers (the  “E.U. Retained Interest”);          (c)    that Spirit MTA REIT believes that the E.U. Retained Interest comprises an interest in the               first loss tranche within the meaning of paragraph 1(d) of Article 405 of the E.U. Capital               Requirements Regulation as supplemented by Article 8, paragraph 1(b) of Commission               Delegated Regulation (EU) No 625/2014, paragraph 1(d) of Article 51 of the AIFMD               Level 2 Regulation and paragraph 2(d) of Article 254 of the Solvency II Level 2               Regulation; and         (d)    that none of Spirit MTA REIT or any of its subsidiaries or affiliates has financed,               transferred, hedged or otherwise mitigated its credit risk under or associated with the EU               Retained Interest, except to the extent permitted under the E.U. Retention Requirements.   Capitalized terms used and not defined in this Schedule V shall be identified as having the meanings set  forth or incorporated by reference in the Series 2018-1 Class A Note Purchase Agreement.                                         Schedule V-1     DMSLIBRARY01\32647597  

 

                                                                                                                                                          EXHIBIT A TO CLASS A                                                         NOTE PURCHASE AGREEMENT                                    ADVANCE REQUEST                                                                          SPIRIT MASTER FUNDING, LLC,                            SPIRIT MASTER FUNDING II, LLC,                            SPIRIT MASTER FUNDING III, LLC,                          SPIRIT MASTER FUNDING VI, LLC, and                           SPIRIT MASTER FUNDING VIII, LLC        SERIES 2018-1 NET-LEASE MORTGAGE VARIABLE FUNDING NOTES, CLASS A     TO:    Spirit Master Funding, LLC  Spirit Master Funding II, LLC   Spirit Master Funding III, LLC   Spirit Master Funding VI, LLC   Spirit Master Funding VIII, LLC   2727 N. Harwood St., Suite 300  Dallas, TX 75201      with a copy to:     Barclays Bank PLC  745 Seventh Avenue, 5th Floor  New York, New York 10019    Re.:  Spirit Master Funding, LLC, Spirit Master Funding II, LLC, Spirit Master Funding III, LLC, Spirit  Master Funding, VI, LLC and Spirit Master Funding VIII, LLC; Series 2018-1 Class A Notes    Ladies and Gentlemen:                This Advance Request is delivered to you pursuant to Section 2.03 of that certain Series  2018-1 Class A Note Purchase Agreement, dated as of November 1, 2018 (as amended, amended and  restated, supplemented or otherwise modified from time to time in accordance with the terms thereof, the  “Series 2018-1 Class A Note Purchase Agreement”; terms defined therein being used herein as therein  defined) among Spirit Master Funding, LLC, Spirit Master Funding II, LLC, Spirit Master Funding III,  LLC Spirit Master Funding VI, LLC and Spirit Master Funding VIII, LLC, as the Co-Issuers, Spirit  Realty, L.P., as the Property Manager, the Conduit Investor, the Committed Note Purchaser for each  Investor Group, the Funding Agent, and Barclays Bank PLC, as Administrative Agent.                Unless otherwise defined herein or as the context otherwise requires, terms used herein  have the meaning assigned thereto under or as provided in the Recitals and Section 1.01 of the Series  2018-1 Class A Note Purchase Agreement.                The undersigned hereby requests that Advances be made in the aggregate principal  amount of $  on     , 20___.                                             A-1     DMSLIBRARY01\32647597  

 

                [IF THE CO-ISSUERS ARE ELECTING EURODOLLAR RATE FOR THESE  ADVANCES ON THE DATE MADE IN ACCORDANCE WITH SECTION 3.01(b) OF THE  CLASS A NOTE PURCHASE AGREEMENT, ADD THE FOLLOWING SENTENCE: The  undersigned hereby elects that the Advances that are not funded at the CP Rate by an Eligible  Conduit Investor shall be Eurodollar Advances and the related Eurodollar Interest Accrual Period  shall commence on the date of such Eurodollar Advances and end on but excluding the date [one  month subsequent to such date] [two months subsequent to such date] [three months subsequent to  such date] [six months subsequent to such date].                 The undersigned hereby acknowledges that the delivery of this Advance Request and  the acceptance by the undersigned of the proceeds of the Advances requested hereby constitute a  representation and warranty by the undersigned that, on the date of such Advances, and before and after  giving effect thereto and to the application of the proceeds therefrom, all conditions set forth in Section  7.03 of the Series 2018-1 Class A Note Purchase Agreement have been satisfied and all statements set  forth in Section 6.01 of the Series 2018-1 Class A Note Purchase Agreement are true and correct,  including the following:                1.   the Class A LTV Ratio is equal to or less than 70%, the calculation of which is set                   forth in reasonable detail on Annex A attached hereto                2.   the Average Cashflow Coverage Ratio for the most recently ended three-month                   period, as of the last day of the immediately preceding calendar month, as set forth in                   the most recent Determination Date Report is greater than or equal to 1.40:1.00; and                3.  the Series 2018-1 Class A Outstanding Principal Amount does not exceed the Series                   2018-1 Class A Notes Maximum Principal Amount after giving effect to any                   reduction thereto pursuant to Section 2.05,                The undersigned hereby certifies that each Mortgaged Loan and each commercial  property acquired by the Co-Issuers after the Series 2018-1 Closing Date is listed in Annex A hereto  and that each such Mortgaged Loan and commercial property is a Qualified Mortgage Loan and  Qualified Mortgaged Property, respectively, except as set forth on Annex A, and the Appraised Values  of each such commercial property is set forth on Annex A.                The undersigned agrees that if prior to the time of the Advances requested hereby any  matter certified to herein by it will not be true and correct at such time as if then made, it will  immediately so notify both you and each Investor. Except to the extent, if any, that prior to the time of  the Advances requested hereby you and each Investor shall receive written notice to the contrary from  the undersigned, each matter certified to herein shall be deemed once again to be certified as true and  correct at the date of such Advances as if then made.                Please wire transfer the proceeds of the Advances to the Co-Issuers pursuant to the  following instructions:                [insert payment instruction for payment to Co-Issuers]                                              A-2     DMSLIBRARY01\32647597  

 

                 The undersigned has caused this Advance Request to be executed and delivered, and the  certification and warranties contained herein to be made, by its duly Authorized Officer this ____ day of  _____________, 20__.                                               [SPIRIT MASTER FUNDING, LLC                                          SPIRIT MASTER FUNDING II, LLC                                          SPIRIT MASTER FUNDING III, LLC                                          SPIRIT MASTER FUNDING VI, LLC                                          SPIRIT MASTER FUNDING VIII, LLC                                             By: SMTA SPE Manager, LLC, its manager]                                          [SPIRIT REALTY, L.P., as the Property Manager on                                             behalf of the Co-Issuers                                             By: Spirit General OP Holdings, its manager]                                                                                                                                    By:                                                                        Name:                                             Title:                                                                                               A-3     DMSLIBRARY01\32647597  

 

                               ANNEX A TO ADVANCE REQUEST              1.  Class A LTV Ratio:                a.    Aggregate Note Principal                    Balances of all Outstanding Notes at                such time                b.    Aggregate Collateral Value of                 the Qualified Mortgage Loans and the                Qualified Mortgaged Properties (that do                not otherwise secure Mortgage Loans)                that are included in the Collateral Pool                 c.    aggregate amount by which the                 Asset Concentrations exceed the                applicable Maximum Asset                Concentration with respect to such                Qualified Mortgage Loans and the                Qualified Mortgaged Properties                d.    aggregate Net Release Price                 amount on deposit in the Release                Account                                                                  e.    a/((b-c)+d)                 f.    Equal to or less than 70%   Y/N                                                                 2.  Mortgaged Properties/Mortgage Loans acquired after Series 2018-1 Closing Date:       (Set forth each each Mortgaged Loan and each commercial property acquired by the Co-Issuers       after the Series 2018-1 Closing Date, whether such Mortgaged Loan/commercial property is a       Qualified Mortgage Loan/Qualified Mortgaged Property, respectively, and the Appraised Values)                                                                                    A-4      DMSLIBRARY01\32647597  

 

                                                                   EXHIBIT B TO CLASS A                                                         NOTE PURCHASE AGREEMENT                ASSIGNMENT AND ASSUMPTION AGREEMENT, dated as of [  ], among [       ] (the “Transferor”), each purchaser listed as an Acquiring Committed Note Purchaser on the  signature pages hereof (each, an “Acquiring Committed Note Purchaser”), the Funding Agent with  respect to such Acquiring Committed Note Purchaser listed on the signature pages hereof (each, a  “Funding Agent”), and the Co-Issuers listed on the signature pages hereof.                                     W I T N E S S E T H:                WHEREAS, this Assignment and Assumption Agreement is being executed and  delivered in accordance with Section 9.17(a) of that certain Series 2018-1 Class A Note Purchase  Agreement, dated as of February 16, 2018 (as amended, amended and restated, supplemented or  otherwise modified from time to time in accordance with the terms thereof, the “Series 2018-1 Class A  Note Purchase Agreement”; terms defined therein being used herein as therein defined) among Spirit  Master Funding, LLC, Spirit Master Funding II, LLC, Spirit Master Funding III, LLC, Spirit Master  Funding VI, LLC and Spirit Master Funding VII, LLC, as the Co-Issuers, Spirit Realty, L.P., as the  Property Manager, the Conduit Investor, the Committed Note Purchaser for each Investor Group, the  Funding Agent, and Barclays Bank PLC, as the Administrative Agent;                 WHEREAS, each Acquiring Committed Note Purchaser (if it is not already an existing  Committed Note Purchaser) wishes to become a Committed Note Purchaser party to the Series 2018-1  Class A Note Purchase Agreement; and                WHEREAS, the Transferor is selling and assigning to each Acquiring Committed Note  Purchaser, [all] [a portion of] its rights, obligations and commitments under the Series 2018-1 Class A  Note Purchase Agreement, the Series 2018-1 Class A Notes and each other Transaction Document to  which it is a party with respect to the percentage of its Commitment Amount specified on Schedule I  attached hereto;                NOW, THEREFORE, the parties hereto hereby agree as follows:                Upon the execution and delivery of this Assignment and Assumption Agreement by each  Acquiring Committed Note Purchaser, each related Funding Agent, the Transferor and, to the extent  required by Section 9.17(a) of the Series 2018-1 Class A Note Purchase Agreement, the Co-Issuers (the  date of such execution and delivery, the “Transfer Issuance Date”), each Acquiring Committed Note  Purchaser shall be a Committed Note Purchaser party to the Series 2018-1 Class A Note Purchase  Agreement for all purposes thereof.                The Transferor acknowledges receipt from each Acquiring Committed Note Purchaser of  an amount equal to the purchase price, as agreed between the Transferor and such Acquiring Committed  Note Purchaser (the “Purchase Price”), of the portion being purchased by such Acquiring Committed  Note Purchaser (such Acquiring Committed Note Purchaser’s “Purchased Percentage”) of (i) the  Transferor’s Commitment under the Series 2018-1 Class A Note Purchase Agreement and (ii) the  Transferor’s Committed Note Purchaser Percentage of the related Investor Group Principal Amount. The  Transferor hereby irrevocably sells, assigns and transfers to each Acquiring Committed Note Purchaser,  without recourse, representation or warranty, and each Acquiring Committed Note Purchaser hereby  irrevocably purchases, takes and assumes from the Transferor, such Acquiring Committed Note  Purchaser’s Purchased Percentage of (x) the Transferor’s Commitment under the Series 2018-1 Class A                                             B-1     DMSLIBRARY01\32647597  

 

   Note Purchase Agreement and (y) the Transferor’s Committed Note Purchaser Percentage of the related  Investor Group Principal Amount.                The Transferor has made arrangements with each Acquiring Committed Note Purchaser  with respect to [(i)] the portion, if any, to be paid, and the date or dates for payment, by the Transferor to  such Acquiring Committed Note Purchaser of any program fees, undrawn facility fee, structuring and  commitment fees or other fees (collectively, the “Fees”) [heretofore received] by the Transferor pursuant  to Section 3.02 of the Series 2018-1 Class A Note Purchase Agreement prior to the Transfer Issuance  Date [and (ii) the portion, if any, to be paid, and the date or dates for payment, by such Acquiring  Committed Note Purchaser to the Transferor of Fees or [                   ] received by such Acquiring  Committed Note Purchaser pursuant to the Series 2018-1 Supplement from and after the Transfer  Issuance Date].                From and after the Transfer Issuance Date, amounts that would otherwise be payable to  or for the account of the Transferor pursuant to the Series 2018-1 Supplement or the Series 2018-1 Class  A Note Purchase Agreement shall, instead, be payable to or for the account of the Transferor and the  Acquiring Committed Note Purchasers, as the case may be, in accordance with their respective interests  as reflected in this Assignment and Assumption Agreement, whether such amounts have accrued prior to  the Transfer Issuance Date or accrue subsequent to the Transfer Issuance Date.                Each of the parties to this Assignment and Assumption Agreement agrees that at any  time and from time to time upon the written request of any other party, it will execute and deliver such  further documents and do such further acts and things as such other party may reasonably request in  order to effect the purposes of this Assignment and Assumption Agreement.                By executing and delivering this Assignment and Assumption Agreement, the Transferor  and each Acquiring Committed Note Purchaser confirm to and agree with each other, the other parties to  the Series 2018-1 Class A Note Purchase Agreement as follows: (i) other than the representation and  warranty that it is the legal and beneficial owner of the interest being assigned hereby free and clear of any  adverse claim, the Transferor makes no representation or warranty and assumes no responsibility with  respect to any statements, warranties or representations made in or in connection with the Series 2018-1  Supplement, the Series 2018-1 Class A Note Purchase Agreement or the execution, legality, validity,  enforceability, genuineness, sufficiency or value of the Indenture, the Series 2018-1 Class A Notes, the  Transaction Documents or any instrument or document furnished pursuant thereto; (ii) the Transferor  makes no representation or warranty and assumes no responsibility with respect to the financial condition  of the Co-Issuers or the performance or observance by the Co-Issuers of any of the Co-Issuers’ obligations  under the Indenture, the Series 2018-1 Class A Note Purchase Agreement, the Transaction Documents or  any other instrument or document furnished pursuant hereto; (iii) each Acquiring Committed Note  Purchaser confirms that it has received a copy of the Indenture, the Series 2018-1 Supplement, the Series  2018-1 Class A Note Purchase Agreement and such other Transaction Documents and other documents  and information as it has deemed appropriate to make its own credit analysis and decision to enter into this  Assignment and Assumption Agreement; (iv) each Acquiring Committed Note Purchaser will,  independently and without reliance upon the Administrative Agent, the Transferor, the Funding Agent or  any other Investor Group and based on such documents and information as it shall deem appropriate at the  time, continue to make its own credit decisions in taking or not taking action under the Series 2018-1 Class  A Note Purchase Agreement; (v) each Acquiring Committed Note Purchaser appoints and authorizes the  Administrative Agent to take such action and to exercise such powers under the Series 2018-1 Class A  Note Purchase Agreement as are delegated to the Administrative Agent by the terms thereof, together with  such powers as are reasonably incidental thereto, all in accordance with Article V of the Series 2018-1  Class A Note Purchase Agreement; (vi) each Acquiring Committed Note Purchaser appoints and  authorizes its related Funding Agent to take such action as agent on its behalf and to exercise such powers                                             B-2     DMSLIBRARY01\32647597  

 

   under the Series 2018-1 Class A Note Purchase Agreement as are delegated to such Funding Agent by the  terms thereof, together with such powers as are reasonably incidental thereto, all in accordance with Article  V of the Series 2018-1 Class A Note Purchase Agreement; (vii) each Acquiring Committed Note Purchaser  agrees that it will perform in accordance with their terms all of the obligations that by the terms of the  Series 2018-1 Class A Note Purchase Agreement are required to be performed by it as an Acquiring  Committed Note Purchaser; and (viii) each Acquiring Committed Note Purchaser hereby represents and  warrants to the Co-Issuers and the Property Manager that: (A) it has had an opportunity to discuss the Co- Issuers’ and the Property Manager’s business, management and financial affairs, and the terms and  conditions of the proposed purchase, with the Co-Issuers, and the Property Manager and their respective  representatives; (B) it is an “accredited investor” within the meaning of Rule 501(a)(1), (2), (3) or (7) of  Regulation D under the 1933 Act and has sufficient knowledge and experience in financial and business  matters to be capable of evaluating the merits and risks of investing in, and is able and prepared to bear the  economic risk of investing in, the Series 2018-1 Class A Notes; (C) it is purchasing the Series 2018-1 Class  A Notes for its own account, or for the account of one or more “accredited investors” within the meaning  of Rule 501(a)(1), (2), (3) or (7) of Regulation D under the 1933 Act that meet the criteria described in  clause (viii)(B) above and for which it is acting with complete investment discretion, for investment  purposes only and not with a view to distribution, subject, nevertheless, to the understanding that the  disposition of its property shall at all times be and remain within its control, and neither it nor its Affiliates  has engaged in any general solicitation or general advertising within the meaning of the 1933 Act with  respect to the Series 2018-1 Class A Notes; (D) it understands that (I) the Series 2018-1 Class A Notes  have not been and will not be registered or qualified under the 1933 Act or any applicable state securities  laws or the securities laws of any other jurisdiction and are being offered only in a transaction not  involving any public offering within the meaning of the 1933 Act and may not be resold or otherwise  transferred unless so registered or qualified or unless an exemption from registration or qualification is  available and an opinion of counsel shall have been delivered in advance to the Co-Issuers, (II) the Co- Issuers are not required to register the Series 2018-1 Class A Notes, (III) any permitted transferee  hereunder must meet the criteria described under clause (viii)(B) above and (IV) any transfer must comply  with the provisions of Section 2.05 of the Indenture and Section 9.03 or 9.17, as applicable, of the Series  2018-1 Class A Note Purchase Agreement; (E) it will comply with the requirements of clause (viii)(D)  above in connection with any transfer by it of the Series 2018-1 Class A Notes; (F) it understands that the  Series 2018-1 Class A Notes will bear the legend set out in the form of Series 2018-1 Class A Notes  attached to the Series 2018-1 Supplement and be subject to the restrictions on transfer described in such  legend; (G) it will obtain for the benefit of the Co-Issuers from any purchaser of the Series 2018-1 Class  A Notes substantially the same representations and warranties contained in the foregoing paragraphs; and  (H) it has executed a Purchaser’s Letter substantially in the form of Exhibit D to the Series 2018-1 Class  A Note Purchase Agreement.                Schedule I hereto sets forth (i) the Purchased Percentage for each Acquiring Committed  Note Purchaser, (ii) the revised Commitment Amounts of the Transferor and each Acquiring Committed  Note Purchaser, and (iii) the revised Maximum Investor Group Principal Amounts for the Investor  Groups of the Transferor and each Acquiring Committed Note Purchaser (it being understood that if the  Transferor was part of a Conduit Investor’s Investor Group and the Acquiring Committed Note Purchaser  is intended to be part of the same Investor Group, there will not be any change to the Maximum Investor  Group Principal Amount for that Investor Group) and (iv) administrative information with respect to each  Acquiring Committed Note Purchaser and its related Funding Agent.                This Assignment and Assumption Agreement and all matters arising under or in any  manner relating to this Assignment and Assumption Agreement shall be governed by, and construed in  accordance with, the laws of the State of New York without giving effect to any choice of law or conflict  provision or rule (whether of the State of New York or any other jurisdiction) that would cause the                                             B-3     DMSLIBRARY01\32647597  

 

   application of the laws of any jurisdiction other than the State of New York, and the obligations, rights  and remedies of the parties hereto shall be determined in accordance with such law.                ALL PARTIES HEREUNDER HEREBY KNOWINGLY, VOLUNTARILY AND  INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT  OF ANY LITIGATION BASED HEREON OR ON THE SERIES 2018-1 CLASS A NOTE PURCHASE  AGREEMENT, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS ASSIGNMENT  AND ASSUMPTION AGREEMENT OR THE SERIES 2018-1 CLASS A NOTE PURCHASE  AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS  (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE PARTIES IN CONNECTION  HEREWITH OR THEREWITH. ALL PARTIES ACKNOWLEDGE AND AGREE THAT THEY  HAVE RECEIVED FULL AND SIGNIFICANT CONSIDERATION FOR THIS PROVISION AND  THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR ALL PARTIES TO ENTER INTO  THIS ASSIGNMENT AND ASSUMPTION AGREEMENT.                                                 B-4     DMSLIBRARY01\32647597  

 

                 IN WITNESS WHEREOF, the parties hereto have caused this Assignment and  Assumption Agreement to be executed by their respective duly authorized officers as of the date first set  forth above.                                                  [                    ], as Transferor                                                                                                                                                   By:                                                                       Name:                                                      Title:                                                                                                                                                           By:                                                                       Name:                                                      Title:                                                                                                                                                           [                    ], as Acquiring                                                 Committed Note Purchaser                                                                                                                                                   By:                                                                       Name:                                                      Title:                                                                                                                                                           [         ], as Funding Agent                                                                                                  By:                                                                    Name:                                                   Title:                                                B-5     DMSLIBRARY01\32647597  

 

                                           CONSENTED AND ACKNOWLEDGED BY THE                                          CO-ISSUERS:                                                                                           SPIRIT MASTER FUNDING, LLC,                                                 as Co-Issuer                                                    By: SMTA SPE Manager, LLC, its                                                 manager                                                                                                                                                   By:                                                                    Name:                                                   Title:                                                                                                                                                    SPIRIT MASTER FUNDING II, LLC,                                                 as Co-Issuer                                                    By: SMTA SPE Manager, LLC, its                                                 manager                                                                                                                                                   By:                                                                    Name:                                                   Title:                                                                                                                                                    SPIRIT MASTER FUNDING III, LLC,                                                 as Co-Issuer                                                    By: SMTA SPE Manager, LLC, its                                                 manager                                                                                                                                                   By:                                                                    Name:                                                   Title:                                                                                                                                                    SPIRIT MASTER FUNDING VI, LLC,                                                 as Co-Issuer                                                    By: SMTA SPE Manager, LLC, its                                                 manager                                                                                                                                                   By:                                                                    Name:                                                   Title:                                                                                                                                                    SPIRIT MASTER FUNDING VIII, LLC,                                                 as Co-Issuer                                                    By: SMTA SPE Manager, LLC, its                                                 manager                                            B-6     DMSLIBRARY01\32647597  

 

                                                                                                                                                    By:                                                                    Name:                                                   Title:                                                                                                                                                                                    B-7     DMSLIBRARY01\32647597  

 

                                                                          SCHEDULE I TO                                          ASSIGNMENT AND ASSUMPTION AGREEMENT                             LIST OF ADDRESSES FOR NOTICES                            AND OF COMMITMENT AMOUNTS                                                [____________________], as Transferor    Prior Commitment Amount: $[      ]  Revised Commitment Amount:       $[      ]   Prior Maximum Investor Group        Principal Amount:   $[           ]          Revised Maximum Investor            Group Principal Amount:    $[    ]         Related Conduit Investor                   (if applicable) [                                   ]                                              [ ], as    Acquiring Committed Note Purchaser Address:    Attention:    Telephone:    Email:    Purchased Percentage of Transferor’s Commitment: [    ]%    Prior Commitment Amount: $[ ]    Revised Commitment Amount:  $[   ]    Prior Maximum Investor Group    Principal Amount:   $[    ]                                              B-8     DMSLIBRARY01\32647597  

 

   Revised Maximum Investor Group Principal Amount:  $[ ]    Related Conduit Investor (if applicable) [ ]      [_____________________], as related Funding Agent      Address:      Attention:    Telephone:      Email:                                                  B-9     DMSLIBRARY01\32647597  

 

                                                                  EXHIBIT C TO CLASS A                                                         NOTE PURCHASE AGREEMENT                INVESTOR GROUP SUPPLEMENT, dated as of [       ], among (i) [ ] (the  “Transferor Investor Group”), (ii) [ ] (the “Acquiring Investor Group”), (iii) the Funding Agent with  respect to the Acquiring Investor Group listed on the signature pages hereof (each, a “Funding Agent”),  and (iv) the Co-Issuers.                                     W I T N E S S E T H:                WHEREAS, this Investor Group Supplement is being executed and delivered in  accordance with Section 9.17(c) of that certain Series 2018-1 Class A Note Purchase Agreement, dated as  of November 1, 2018 (as amended, supplemented, amended and restated or otherwise modified from time  to time, the “Series 2018-1 Class A Note Purchase Agreement”; terms defined therein being used herein  as therein defined) among Spirit Master Funding, LLC, Spirit Master Funding II, LLC, Spirit Master  Funding III, LLC, Spirit Master Funding VI, LLC and Spirit Master Funding VII, LLC, Spirit Realty,  L.P., as the Property Manager,  the Conduit Investor, the Committed Note Purchaser for each Investor  Group, the Funding Agent and Barclays Bank PLC, as Administrative Agent;                WHEREAS, the Acquiring Investor Group wishes to become a Conduit Investor and [a]  Committed Note Purchaser[s] with respect to such Conduit Investor under the Series 2018-1 Class A Note  Purchase Agreement; and                WHEREAS, the Transferor Investor Group is selling and assigning to the Acquiring  Investor Group [all] [a portion of] its respective rights, obligations and commitments under the Series  2018-1 Class A Note Purchase Agreement, the Series 2018-1 Class A Notes and each other Transaction  Document to which it is a party with respect to the percentage of its Commitment Amount specified on  Schedule I attached hereto;                NOW, THEREFORE, the parties hereto hereby agree as follows:                Upon the execution and delivery of this Investor Group Supplement by the Acquiring  Investor Group, each related Funding Agent with respect thereto, the Transferor Investor Group and, to  the extent required by Section 9.17(c) of the Series 2018-1 Class A Note Purchase Agreement (the date of  such execution and delivery, the “Transfer Issuance Date”) the Co-Issuers, the Conduit Investor and the  Committed Note Purchaser[s] with respect to the Acquiring Investor Group shall be parties to the Series  2018-1 Class A Note Purchase Agreement for all purposes thereof.                The Transferor Investor Group acknowledges receipt from the Acquiring Investor Group  of an amount equal to the purchase price, as agreed between the Transferor Investor Group and the  Acquiring Investor Group (the “Purchase Price”), of the portion being purchased by the Acquiring  Investor Group (the Acquiring Investor Group’s “Purchased Percentage”) of (i) the aggregate  Commitment[s] of the Committed Note Purchaser[s] included in the Transferor Investor Group under the  Series 2018-1 Class A Note Purchase Agreement and (ii) the aggregate related Committed Note  Purchaser Percentage[s] of the related Investor Group Principal Amount. The Transferor Investor Group  hereby irrevocably sells, assigns and transfers to the Acquiring Investor Group, without recourse,  representation or warranty, and the Acquiring Investor Group hereby irrevocably purchases, takes and  assumes from the Transferor Investor Group, such Acquiring Investor Group’s Purchased Percentage of  (x) the aggregate Commitment[s] of the Committed Note Purchaser[s] included in the Transferor  Investor Group under the Series 2018-1 Class A Note Purchase Agreement and (y) the aggregate related  Committed Note Purchaser Percentage[s] of the related Investor Group Principal Amount.                                             C-1     DMSLIBRARY01\32647597  

 

                The Transferor Investor Group has made arrangements with the Acquiring Investor Group  with respect to (i) the portion, if any, to be paid, and the date or dates for payment, by the Transferor  Investor Group to such Acquiring Investor Group of any program fees, undrawn facility fee, structuring  and commitment fees or other fees (collectively, the “Fees”) [heretofore received] by the Transferor  Investor Group pursuant to Section 3.02 of the Series 2018-1 Class A Note Purchase Agreement prior to  the Transfer Issuance Date [and (ii) the portion, if any, to be paid, and the date or dates for payment, by  such Acquiring Investor Group to the Transferor Investor Group of Fees or [ ] received by such  Acquiring Investor Group pursuant to the Series 2018-1 Supplement from and after the Transfer Issuance  Date].                From and after the Transfer Issuance Date, amounts that would otherwise be payable to  or for the account of the Transferor Investor Group pursuant to the Series 2018-1 Supplement or the  Series 2018-1 Class A Note Purchase Agreement shall, instead, be payable to or for the account of the  Transferor Investor Group and the Acquiring Investor Group, as the case may be, in accordance with  their respective interests as reflected in this Investor Group Supplement, whether such amounts have  accrued prior to the Transfer Issuance Date or accrue subsequent to the Transfer Issuance Date.                Each of the parties to this Investor Group Supplement agrees that at any time and from  time to time upon the written request of any other party, it will execute and deliver such further  documents and do such further acts and things as such other party may reasonably request in order to  effect the purposes of this Investor Group Supplement.                The Acquiring Investor Group has executed and delivered to the Co-Issuers (with a copy  to the Indenture Trustee) a Purchaser’s Letter substantially in the form of Exhibit D to the Series 2018-1  Class A Note Purchase Agreement.                By executing and delivering this Investor Group Supplement, the Transferor Investor  Group and the Acquiring Investor Group confirm to and agree with each other, the other parties to the  Series 2018-1 Class A Note Purchase Agreement as follows: (i) other than the representation and warranty  that it is the legal and beneficial owner of the interest being assigned hereby free and clear of any adverse  claim, the Transferor Investor Group makes no representation or warranty and assumes no responsibility  with respect to any statements, warranties or representations made in or in connection with the Series  2018-1 Supplement, the Series 2018-1 Class A Note Purchase Agreement or the execution, legality,  validity, enforceability, genuineness, sufficiency or value of the Indenture, the Series 2018-1 Class A  Notes, the Transaction Documents or any instrument or document furnished pursuant thereto; (ii) the  Transferor Investor Group makes no representation or warranty and assumes no responsibility with  respect to the financial condition of the Co-Issuers or the performance or observance by the Co-Issuers of  any of the Co-Issuers’ obligations under the Indenture, the Series 2018-1 Supplement, the Series 2018-1  Class A Note Purchase Agreement, the Transaction Documents or any other instrument or document  furnished pursuant hereto; (iii) the Acquiring Investor Group confirms that it has received a copy of the  Indenture, the Series 2018-1 Supplement, the Series 2018-1 Class A Note Purchase Agreement and such  other Transaction Documents and other documents and information as it has deemed appropriate to make  its own credit analysis and decision to enter into this Investor Group Supplement; (iv) the Acquiring  Investor Group will, independently and without reliance upon the Administrative Agent, the Transferor  Investor Group, the Funding Agent or any other Person and based on such documents and information as  it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking  action under the Series 2018-1 Class A Note Purchase Agreement; (v) the Acquiring Investor Group  appoints and authorizes the Administrative Agent to take such action and to exercise such powers under  the Series 2018-1 Class A Note Purchase Agreement as are delegated to the Administrative Agent by the  terms thereof, together with such powers as are reasonably incidental thereto, all in accordance with  Article V of the Series 2018-1 Class A Note Purchase Agreement; (vi) each member of the Acquiring                                             C-2     DMSLIBRARY01\32647597  

 

   Investor Group appoints and authorizes its related Funding Agent, listed on Schedule I hereto, to take  such action as agent on its behalf and to exercise such powers under the Series 2018-1 Class A Note  Purchase Agreement as are delegated to such Funding Agent by the terms thereof, together with such  powers as are reasonably incidental thereto, all in accordance with Article V of the Series 2018-1 Class A  Note Purchase Agreement; (vii) each member of the Acquiring Investor Group agrees that it will perform  in accordance with their terms all of the obligations that by the terms of the Series 2018-1 Class A Note  Purchase Agreement are required to be performed by it as a member of the Acquiring Investor Group; and  (viii) each member of the Acquiring Investor Group hereby represents and warrants to the Co-Issuers and  the Property Manager that: (A) it has had an opportunity to discuss the Co-Issuers’ and the Property  Manager’s business, management and financial affairs, and the terms and conditions of the proposed  purchase, with the Co-Issuers and the Property Manager and their respective representatives; (B) it is an  “accredited investor” within the meaning of Rule 501(a)(1), (2), (3) or (7) of Regulation D under the 1933  Act and has sufficient knowledge and experience in financial and business matters to be capable of  evaluating the merits and risks of investing in, and is able and prepared to bear the economic risk of  investing in, the Series 2018-1 Class A Notes; (C) it is purchasing the Series 2018-1 Class A Notes for its  own account, or for the account of one or more “accredited investors” within the meaning of Rule  501(a)(1), (2), (3) or (7) of Regulation D under the 1933 Act that meet the criteria described in clause  (viii)(B) above and for which it is acting with complete investment discretion, for investment purposes  only and not with a view to distribution, subject, nevertheless, to the understanding that the disposition of  its property shall at all times be and remain within its control, and neither it nor its Affiliates has engaged  in any general solicitation or general advertising within the meaning of the 1933 Act with respect to the  Series 2018-1 Class A Notes; (D) it understands that (I) the Series 2018-1 Class A Notes have not been  and will not be registered or qualified under the 1933 Act or any applicable state securities laws or the  securities laws of any other jurisdiction and are being offered only in a transaction not involving any  public offering within the meaning of the 1933 Act and may not be resold or otherwise transferred unless  so registered or qualified or unless an exemption from registration or qualification is available and an  opinion of counsel shall have been delivered in advance to the Co-Issuers, (II) the Co-Issuers are not  required to register the Series 2018-1 Class A Notes, (III) any permitted transferee hereunder must meet  the criteria described under clause (viii)(B) above and (IV) any transfer must comply with the provisions  of Section 2.8 of the Indenture and Section 9.03 or 9.17, as applicable, of the Series 2018-1 Class A Note  Purchase Agreement; (E) it will comply with the requirements of clause (viii)(D) above in connection  with any transfer by it of the Series 2018-1 Class A Notes; (F) it understands that the Series 2018-1 Class  A Notes will bear the legend set out in the form of Series 2018-1 Class A Notes attached to the Series  2018-1 Supplement and be subject to the restrictions on transfer described in such legend; (G) it will  obtain for the benefit of the Co-Issuers from any purchaser of the Series 2018-1 Class A Notes  substantially the same representations and warranties contained in the foregoing paragraphs; and (H) it  has executed a Purchaser’s Letter substantially in the form of Exhibit D to the Series 2018-1 Class A Note  Purchase Agreement.                Schedule I hereto sets forth (i) the Purchased Percentage for the Acquiring Investor  Group, (ii) the revised Commitment Amounts of the Transferor Investor Group and the Acquiring  Investor Group, and (iii) the revised Maximum Investor Group Principal Amounts for the Transferor  Investor Group and the Acquiring Investor Group and (iv) administrative information with respect to  the Acquiring Investor Group and its related Funding Agent.                This Investor Group Supplement and all matters arising under or in any manner relating  to this Investor Group Supplement shall be governed by, and construed in accordance with, the laws of  the State of New York without giving effect to any choice of law or conflict provision or rule (whether of  the State of New York or any other jurisdiction) that would cause the application of the laws of any  jurisdiction other that the State of New York, and the obligations, rights and remedies of the parties hereto  shall be determined in accordance with such law.                                            C-3     DMSLIBRARY01\32647597  

 

                ALL PARTIES HEREUNDER HEREBY KNOWINGLY, VOLUNTARILY AND  INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT  OF ANY LITIGATION BASED HEREON OR ON THE SERIES 2018-1 CLASS A NOTE PURCHASE  AGREEMENT, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS INVESTOR  GROUP SUPPLEMENT OR THE SERIES 2018-1 CLASS A NOTE PURCHASE AGREEMENT, OR  ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR  WRITTEN) OR ACTIONS OF THE PARTIES IN CONNECTION HEREWITH OR THEREWITH.  ALL PARTIES ACKNOWLEDGE AND AGREE THAT THEY HAVE RECEIVED FULL AND  SIGNIFICANT CONSIDERATION FOR THIS PROVISION AND THAT THIS PROVISION IS A  MATERIAL INDUCEMENT FOR ALL PARTIES TO ENTER INTO THIS INVESTOR GROUP  SUPPLEMENT.                IN WITNESS WHEREOF, the parties hereto have caused this Investor Group  Supplement to be executed by their respective duly authorized officers as of the date first set forth above.                                           [           ], as Transferor Investor Group                                                                                                                              By:                                                                    Name:                                            Title                                                                                                                              [         ], as Acquiring Investor Group                                                                                                                              By:                                                                    Name:                                            Title:                                                                                                                              [                    ], as Funding Agent                                                                                                                              By:                                                                    Name:                                            Title                                                 C-4     DMSLIBRARY01\32647597  

 

                                                  CONSENTED AND ACKNOWLEDGED                                                 BY THE CO-ISSUERS:                                                                                                  SPIRIT MASTER FUNDING, LLC,                                                 as Co-Issuer                                                    By: SMTA SPE Manager, LLC, its                                                 manager                                                                                                                                                   By:                                                                    Name:                                                   Title:                                                                                                                                                    SPIRIT MASTER FUNDING II, LLC,                                                 as Co-Issuer                                                    By: SMTA SPE Manager, LLC, its                                                 manager                                                                                                                                                   By:                                                                    Name:                                                   Title:                                                                                                                                                    SPIRIT MASTER FUNDING III, LLC,                                                 as Co-Issuer                                                    By: SMTA SPE Manager, LLC, its                                                 manager                                                                                                                                                   By:                                                                    Name:                                                   Title:                                                                                                                                                    SPIRIT MASTER FUNDING VI, LLC,                                                 as Co-Issuer                                                    By: SMTA SPE Manager, LLC, its                                                 manager                                                                                                                                                   By:                                                                    Name:                                                   Title:                                                                                                                                                    SPIRIT MASTER FUNDING VIII, LLC,                                                 as Co-Issuer                                                    By: SMTA SPE Manager, LLC, its                                                 manager                                            C-5     DMSLIBRARY01\32647597  

 

                                                                                                                                                    By:                                                                    Name:                                                   Title:                                                                                                   C-6     DMSLIBRARY01\32647597  

 

                                                                          SCHEDULE I TO                                                        INVESTOR GROUP SUPPLEMENT                                                                          LIST OF ADDRESSES FOR NOTICES                             AND OF COMMITMENT AMOUNTS   [____________________], as Transferor Investor Group    Prior Commitment Amount: $[ ]    Revised Commitment Amount:  $[   ]    Prior Maximum Investor Group  Principal Amount:   $[    ]    Revised Maximum Investor  Group Principal Amount:    $[    ]        [_______________________], as Acquiring Investor Group    Address:    Attention:    Telephone:  Email:      Purchased Percentage of  Transferor Investor Group’s Commitment: [_______]%    Prior Commitment Amount: $[________]    Revised Commitment Amount:  $[______]    Prior Maximum Investor Group  Principal Amount:   $[________  Revised Maximum Investor  Group Principal Amount:   $[_______      [_________________________________], as related Funding Agent    Address:    Attention:  Telephone:  Email:                                             C-7     DMSLIBRARY01\32647597  

 

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                                                                     EXHIBIT D TO CLASS A                                                         NOTE PURCHASE AGREEMENT                                                                                                                     [FORM OF PURCHASER’S LETTER]   [INVESTOR]  [INVESTOR ADDRESS]  Attention: [INVESTOR CONTACT]                 [Date]    Ladies and Gentlemen:                Reference is hereby made to that certain Series 2018-1 Class A Note Purchase  Agreement, dated as of November 1, 2018 (as amended, amended and restated, supplemented or  otherwise modified from time to time in accordance with the terms thereof, the “Series 2018-1 Class A  Note Purchase Agreement”; terms defined therein being used herein as therein defined) among Spirit  Master Funding, LLC, Spirit Master Funding II, LLC, Spirit Master Funding III, LLC, Spirit Master  Funding VI, LLC and Spirit Master Funding VIII, LLC, as the Co-Issuers, Spirit Realty, L.P., as the  Property Manager, the Conduit Investor, the Committed Note Purchaser for the Investor Group, the  Funding Agent and Barclays Bank PLC, as Administrative Agent, relating to the offer and sale (the  “Offering”) of up to $50,000,000 of Series 2018-1 Variable Funding Senior Notes, Class A (the “Series  2018-1 Class A Notes”) of the Co-Issuers.  The Offering will not be required to be registered with the  Securities and Exchange Commission pursuant to the 1933 Act of 1933, as amended (the “Act”) under an  exemption from registration granted in Section 4(a)(2) of the Act and Regulation D promulgated under  the Act.  Unless otherwise defined herein, capitalized terms have the definitions ascribed to them in the  Series 2018-1 Class A Note Purchase Agreement. Please confirm with us your acknowledgement and  agreement with the following:          (a)   You are an “accredited investor” within the meaning of Rule 501(a)(1), (2), (3) or (7) of               Regulation D under the 1933 Act (an “Accredited Investor”) and have sufficient               knowledge and experience in financial and business matters to be capable of evaluating               the merits and risks of investing in, and are able and prepared to bear the economic risk               of investing in, the Series 2018-1 Class A Notes.         (b)    None of the Co-Issuers or its Affiliates (i) has provided you with any information with               respect to the Co-Issuers, the Series 2018-1 Class A Notes or the Offering other than the               information contained in the Series 2018-1 Class A Note Purchase Agreement, or (ii)               makes any representation as to the credit quality of the Co-Issuers or the merits of an               investment in the Series 2018-1 Class A Notes. The Co-Issuers has not provided you with               any legal, business, tax or other advice in connection with the Offering or your possible               purchase of the Series 2018-1 Class A Notes.         (c)    You acknowledge that you have completed your own diligence investigation of the Co-              Issuers and the Series 2018-1 Class A Notes and have had sufficient access to the               agreements, documents, records, officers and directors of the Co-Issuers to make your               investment decision related to the Series 2018-1 Class A Notes. You further acknowledge               that you have had an opportunity to discuss the Co-Issuers’ and the Property Manager’s               business, management and financial affairs, and the terms and conditions of the proposed               purchase, with the Co-Issuers and the Property Manager and their respective               representatives.                                             D-1     DMSLIBRARY01\32647597  

 

           (d)    The Funding Agent may currently or in the future own securities issued by, or have               business relationships (including, among others, lending, depository, risk management,               advisory and banking relationships) with, the Co-Issuers and its affiliates, and the               Funding Agent will manage such security positions and business relationships as it               determines to be in their respective best interests, without regard to the interests of the               holders of the Series 2018-1 Class A Notes.          (e)   You are purchasing the Series 2018-1 Class A Notes for your own account, or for the               account of one or more Persons who are Accredited Investors and who meet the criteria               described in paragraph (a) above and for whom you are acting with complete investment               discretion, for investment purposes only and not with a view to a distribution (but               without prejudice to our right at all times to sell or otherwise dispose of the Series 2018-              1 Class A Notes in accordance with clause (f) below) in violation of the 1933 Act,               subject, nevertheless, to the understanding that the disposition of your property shall at               all times be and remain within your control, and neither you nor your Affiliates has               engaged in any general solicitation or general advertising within the meaning of the Act,               or the rules and regulations promulgated thereunder with respect to the Series 2018-1               Class A Notes. You confirm that, to the extent you are purchasing the Series 2018-1               Class A Notes for the account of one or more other Persons, (i) you have been duly               authorized to make the representations, warranties, acknowledgements and agreements               set forth herein on their behalf and (ii) the provisions of this letter constitute legal, valid               and binding obligations of you and any other Person for whose account you are acting.          (f)   You understand that (i) the Series 2018-1 Class A Notes have not been and will not be               registered or qualified under the Act or any applicable state securities laws or the               securities laws of any other jurisdiction and are being offered only in a transaction not               involving any public offering within the meaning of the Act and may not be resold or               otherwise transferred unless so registered or qualified or unless an exemption from               registration or qualification is available and an opinion of counsel shall have been               delivered in advance to the Co-Issuers, (ii) the Co-Issuers are not required to register the               Series 2018-1 Class A Notes, (iii) any permitted transferee under the Series 2018-1 Class               A Note Purchase Agreement must be an Accredited Investor and (iv) any transfer must               comply with the provisions of Section 2.02 of the Indenture and Section 9.03 or 9.17 of               the Series 2018-1 Class A Note Purchase Agreement, as applicable.         (g)    You will comply with the requirements of paragraph (f) above in connection with any               transfer by you of the Series 2018-1 Class A Notes.         (h)    You understand that the Series 2018-1 Class A Notes will bear the legend set out in the               form of the Series 2018-1 Class A Notes attached to the Indenture and be subject to the               restrictions on transfer described in such legend.         (i)    Either (i) you are not acquiring, holding or subsequently disposing of the Series 2018-1               Class A Notes for or on behalf of, or with the assets of, any plan, account or other               arrangement that is subject to Section 406 of the Employee Retirement Income Security               Act of 1974, as amended (“ERISA”), Section 4975 of the Internal Revenue Code of               1986, as amended (the “Code”), or provisions under any Similar Law (as defined in the               Indenture) or (ii) your purchase and holding of the Series 2018-1 Class A Notes will not               constitute or result in  a non-exempt prohibited transaction under Section 406 of ERISA               or Section 4975 of the Code or a violation of any applicable Similar Law.                                             D-2     DMSLIBRARY01\32647597  

 

       This letter agreement will be governed by and construed in accordance with the laws of the State of New  York without giving effect to any choice of law or conflict provision or rule (whether of the State of New  York or any other jurisdiction) that would cause the application of the laws of any jurisdiction other that  the State of New York.   You understand that the Co-Issuers will rely upon this letter agreement in connection with the Offering.  You agree to notify the Co-Issuers (with a copy to the Indenture Trustee) promptly in writing if any of  your representations, acknowledgements or agreements herein cease to be accurate and complete. You  irrevocably authorize the Co-Issuers to produce this letter to any interested party in any administrative or  legal proceeding or official inquiry with respect to the matters set forth herein.                                                 SPIRIT MASTER FUNDING, LLC,                                                as Co-Issuer                                                    By: SMTA SPE Manager, LLC, its                                                manager                                                                                                                                                By:                                                                     Name:                                                   Title:                                                                                                                                                    SPIRIT MASTER FUNDING II, LLC,                                                 as Co-Issuer                                                    By: SMTA SPE Manager, LLC, its                                                 manager                                                                                                                                                   By:                                                                    Name:                                                   Title:                                                                                                                                                    SPIRIT MASTER FUNDING III, LLC,                                                 as Co-Issuer                                                    By: SMTA SPE Manager, LLC, its                                                 manager                                                                                                                                                   By:                                                                    Name:                                                   Title:                                                                                                                                                    SPIRIT MASTER FUNDING VI, LLC,                                                 as Co-Issuer                                                    By: SMTA SPE Manager, LLC, its                                                 manager                                                                                              D-3     DMSLIBRARY01\32647597  

 

                                                                                                     By:                                                                    Name:                                                   Title:                                                                                                                                                    SPIRIT MASTER FUNDING VIII, LLC,                                                 as Co-Issuer                                                    By: SMTA SPE Manager, LLC, its                                                 manager                                                                                                                                                   By:                                                                    Name:                                                   Title:                                                                                                                                                                                                                                                      Agreed and Acknowledged:                                                                                                   [INVESTOR]                                                                                                                                                   By:                                                         Name:                                                  Title:                                                  D-4     DMSLIBRARY01\32647597

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