Document:

Exhibit 10.8

 

EXECUTION COPY

 

 

 

FLOW MORTGAGE LOAN PURCHASE AND SALE AGREEMENT

 

between

 

GEORGE MASON MORTGAGE, LLC,

as Seller,

 

and

 

REDWOOD RESIDENTIAL ACQUISITION CORPORATION,

as Purchaser

 

August 1, 2012

 

Residential Mortgage Loans

 

(Servicing Released, Temporary Interim Servicing
Period Only)

 

 

 

    	 

    	 

    

 

TABLE OF CONTENTS

 

	 	 	Page
	 	 	 
	SECTION 1.	Definitions	1
	 	 	 
	SECTION 2.	Purchase and Conveyance	15
	 	 	 
	SECTION 3.	Mortgage Loan Schedule	16
	 	 	 
	SECTION 4.	Purchase Price	16
	 	 	 
	SECTION 5.	Examination of Mortgage Files	16
	 	 	 
	SECTION 6.	Delivery of Mortgage Loan Documents	17
	 	 	 
	Subsection 6.01            Possession of Mortgage Files	17
	 	 
	Subsection 6.02            Books and Records	17
	 	 
	Subsection 6.03            Delivery of Mortgage Loan Documents	17
	 	 
	Subsection 6.04            RESPA Notice	18
	 	 
	SECTION 7.	Representations, Warranties and Covenants; Remedies for Breach	18
	 	 	 
	Subsection 7.01            Representations and Warranties Regarding Individual Mortgage Loans	18
	 	 
	Subsection 7.02            Seller Representations and Covenants	29
	 	 
	Subsection 7.03            Repurchase; Substitution	32
	 	 
	Subsection 7.04            Repurchase of Mortgage Loans With Early Payment Default	35
	 	 
	Subsection 7.05            Purchase Price Protection	35
	 	 
	SECTION 8.	Closing	35
	 	 	 
	Subsection 8.01            Closing Conditions	35
	 	 
	Subsection 8.02            Closing Documents	36
	 	 
	SECTION 9.	[Reserved.]	37
	 	 	 
	SECTION 10.	Costs	37
	 	 	 
	SECTION 11.	Interim Servicing; Servicing Transfer	37
	 	 	 
	Subsection 11.01           Temporary Servicing of Mortgage Loans	37
	 	 
	Subsection 11.02           Directions by Purchaser During Interim Servicing Period	39
	 	 
	Subsection 11.03           Collection of Mortgage Loan Payments	39
	 	 
	Subsection 11.04           Establishment of Custodial Account; Deposits in Custodial Account	40
	 	 
	Subsection 11.05           Withdrawals From the Custodial Account	41
	 	 
	Subsection 11.06           Establishment of Escrow Account; Deposits in Escrow Account	42
	 	 
	Subsection 11.07           Withdrawals From Escrow Account	43

 

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	 	 	Page
	 	 	 
	Subsection 11.08           Payment of Taxes, Insurance and Other Charges; Collections Thereunder	43
	 	 
	Subsection 11.09           Transfer of Accounts	44
	 	 
	Subsection 11.10           Maintenance of Hazard Insurance	44
	 	 
	Subsection 11.11           Maintenance of Primary Mortgage Insurance Policy; Claims	45
	 	 
	Subsection 11.12           Fidelity Bond; Errors and Omissions Insurance	46
	 	 
	Subsection 11.13           Title, Management and Disposition of REO Property	46
	 	 
	Subsection 11.14           Servicing Compensation	47
	 	 
	Subsection 11.15           Distributions	47
	 	 
	Subsection 11.16           Statements to the Purchaser	48
	 	 
	Subsection 11.17           [Reserved]	48
	 	 
	Subsection 11.18           Assumption Agreements	48
	 	 
	Subsection 11.19           Satisfaction of Mortgages and Release of Mortgage Files	49
	 	 
	Subsection 11.20           Seller Shall Provide Access and Information as Reasonably Required	49
	 	 
	Subsection 11.21           Inspections	50
	 	 
	Subsection 11.22           Restoration of Mortgaged Property	50
	 	 
	Subsection 11.23           Fair Credit Reporting Act	50
	 	 
	Subsection 11.24           Transfer of Servicing to Purchaser	51
	 	 
	Subsection 11.25           Payments Received	51
	 	 
	SECTION 12.	The Seller	51
	 	 	 
	Subsection 12.01           Indemnification; Third Party Claims	51
	 	 
	Subsection 12.02           Merger or Consolidation of the Seller	51
	 	 
	Subsection 12.03           Limitation on Liability of the Seller and Others	52
	 	 
	SECTION 13.	Default	52
	 	 	 
	Subsection 13.01           Events of Default	52
	 	 
	Subsection 13.02           Waiver of Default	54
	 	 
	SECTION 14.	Termination	54
	 	 	 
	Subsection 14.01           Termination	54
	 	 
	Subsection 14.02           Successors to the Seller as Interim Servicer	54
	 	 
	Subsection 14.03           Termination of Interim Servicing by Purchaser	55
	 	 
	SECTION 15.	Notices	56

 

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	 	 	Page
	 	 	 
	SECTION 16.	Severability Clause	56
	 	 	 
	SECTION 17.	No Partnership	57
	 	 	 
	SECTION 18.	Counterparts	57
	 	 	 
	SECTION 19.	Governing Law; Choice of Forum; Waiver of Jury Trial	57
	 	 	 
	SECTION 20.	Intention of the Parties	58
	 	 	 
	SECTION 21.	Waivers	58
	 	 	 
	SECTION 22.	Exhibits	58
	 	 	 
	SECTION 23.	General Interpretive Principles	58
	 	 	 
	SECTION 24.	Reproduction of Documents	59
	 	 	 
	SECTION 25.	Amendment	59
	 	 	 
	SECTION 26.	Confidentiality	60
	 	 	 
	SECTION 27.	Entire Agreement	60
	 	 	 
	SECTION 28.	Further Agreements	60
	 	 	 
	SECTION 29.	Successors and Assigns	60
	 	 	 
	SECTION 30.	Non-Solicitation	61
	 	 	 
	SECTION 31.	Protection of Consumer Information	61
	 	 	 
	SECTION 32.	Cooperation of the Seller with a Reconstitution; Regulation AB Compliance	61
	 	 	 
	SECTION 1.	DEFINED TERMS	1
	 	 	 
	SECTION 2.	COMPLIANCE WITH REGULATION AB	3
	 	 	 
	Subsection 2.01            Intent of the Parties; Reasonableness	3
	 	 
	Subsection 2.02            Additional Representations and Warranties of the Company	4
	 	 
	Subsection 2.03            Information to Be Provided by the Company	4
	 	 
	Subsection 2.04            Indemnification; Remedies	7
	 	 
	Subsection 2.05            Third-party Beneficiary	8

 

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EXHIBITS

 

	EXHIBIT 1	MORTGAGE LOAN DOCUMENTS
	 	 
	EXHIBIT 2	CONTENTS OF EACH MORTGAGE FILE
	 	 
	EXHIBIT 3	FORM OF PPTL
	 	 
	EXHIBIT 4	SERVICING TRANSFER INSTRUCTIONS
	 	 
	EXHIBIT 5	FORM OF ASSIGNMENT OF REPRESENTATIONS AND WARRANTIES AGREEMENT
	 	 
	ADDENDUM I	REGULATION AB COMPLIANCE ADDENDUM

 

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FLOW MORTGAGE LOAN PURCHASE AND SALE AGREEMENT

 

THIS FLOW MORTGAGE
LOAN PURCHASE AND SALE AGREEMENT (the “Agreement”), dated August 1, 2012, is hereby executed by and between
REDWOOD RESIDENTIAL ACQUISITION CORPORATION, a Delaware corporation, as purchaser (the “Purchaser”),
and GEORGE MASON MORTGAGE, LLC, as seller (the “Seller”).

 

WITNESSETH:

 

WHEREAS, the Seller
has agreed to sell from time to time to the Purchaser, and the Purchaser has agreed to purchase from time to time from the Seller,
certain conventional, residential, first-lien mortgage loans (the “Mortgage Loans”) as described herein on a
servicing released basis, and which shall be delivered as whole loans as provided herein; and

 

WHEREAS, the Mortgage
Loans will be sold by the Seller and purchased by the Purchaser as pools or groups of whole loans on a servicing released basis
(each, a “Mortgage Loan Package”) on the various Closing Dates as provided herein; and

 

WHEREAS, each of the
Mortgage Loans will be secured by a mortgage, deed of trust or other security instrument creating a first lien on a Residential
Dwelling located in the jurisdiction indicated on the related Mortgage Loan Schedule which will be annexed to a PPTL (as defined
herein) on the related Closing Date; and

 

WHEREAS, the Purchaser
and the Seller wish to prescribe the manner of the conveyance and control of the Mortgage Loans;

 

NOW, THEREFORE, in
consideration of the premises and mutual agreements set forth herein, and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Purchaser and the Seller agree as follows:

 

SECTION
1. Definitions.

 

For purposes of this
Agreement, the following capitalized terms shall have the respective meanings set forth below.

 

Adjustable Rate
Mortgage Loan: A Mortgage Loan purchased pursuant to this Agreement which provides for the adjustment of the Mortgage Interest
Rate payable in respect thereto.

 

Adjustment Date:
As to each Adjustable Rate Mortgage Loan, the date on which the Mortgage Interest Rate is adjusted in accordance with the terms
of the related Mortgage Note and Mortgage.

 

    	 

    	 

    

  

Agency Transfer:
The sale or transfer by the Purchaser of some or all of the Mortgage Loans to Fannie Mae, Ginnie Mae or Freddie Mac.

 

Agreement: This
Flow Mortgage Loan Purchase and Sale Agreement including all exhibits, schedules, amendments and supplements hereto.

 

ALTA: The American
Land Title Association or any successor thereto.

 

Anti-Money Laundering
Laws: As defined in Section 7.01(h).

 

Applicable Requirements:
With respect to the Mortgage Loans, as applicable and as of the time of reference, (i) the terms of the applicable Mortgage and
Mortgage Note; (ii) Customary Servicing Procedures; (iii) all federal, state and local laws, statutes, rules, regulations
and ordinances applicable to the servicing of the Mortgage Loans including, without limitation, the applicable requirements and
guidelines of any insurer or any other governmental agency, board, commission, instrumentality or other governmental or quasi-governmental
body or office; (iv) all other judicial and administrative judgments, orders, stipulations, awards, writs and injunctions applicable
to the servicing of the Mortgage Loans; and (v) all contractual obligations relating to the servicing of the Mortgage Loans including,
without limitation, those contractual obligations contained in any applicable servicing agreement or in any agreement relating
to the Mortgage Loans with any insurer or in the Mortgage File.

 

Appraised Value:
With respect to any Mortgaged Property, the lesser of (i) the value (or Reconciled Market Value if more than one appraisal is received)
thereof as determined by a Qualified Appraiser at the time of origination of the Mortgage Loan, and (ii) the purchase price paid
for the related Mortgaged Property by the Mortgagor with the proceeds of the Mortgage Loan; provided, however, that in the
case of a Refinanced Mortgage Loan, such value (or Reconciled Market Value if more than one appraisal is received) of the Mortgaged
Property is based solely upon the value determined by an appraisal or appraisals made for the originator of such Refinanced Mortgage
Loan at the time of origination of such Refinanced Mortgage Loan by a Qualified Appraiser.

 

Appraiser Independence
Requirements: The Appraiser Independence Requirements effective as of October 15, 2010, as amended and in effect from time
to time.

 

Arbitration:
Arbitration in accordance with the then governing Commercial Arbitration Rules of the American Arbitration Association (“AAA”)
and administered by the AAA, which shall be conducted in New York, New York or other place mutually acceptable to the parties to
the arbitration.

 

Arbitrator:
A person who is not affiliated with the Seller or the Purchaser, who is a member of the American Arbitration Association.

 

    	2

    	 

    

 

Assignment of Mortgage:
An individual assignment of the Mortgage, notice of transfer or equivalent instrument in recordable form, sufficient under the
laws of the jurisdiction in which the related Mortgaged Property is located to give record notice of the sale of the Mortgage to
the Purchaser.

 

Assumed Principal
Balance: As to each Mortgage Loan as of any date of determination, (i) the principal balance of the Mortgage Loan outstanding
as of the Cut-off Date after application of payments due on or before the Cut-off Date, whether or not received, minus (ii) all
amounts previously distributed to the Purchaser with respect to the Mortgage Loan pursuant to Subsection 11.15 and representing
payments or other recoveries of principal.

 

Balloon Mortgage
Loan: A Mortgage Loan that provided on the date of origination for monthly payments up to but not including the maturity date
based on an amortization extending beyond its maturity date.

 

Business Day:
Any day other than (i) a Saturday or a Sunday, or (ii) a legal holiday in the State of New York, the State of California or the
Commonwealth of Virginia, or (iii) a day on which banks in the State of New York, the State of California or the Commonwealth of
Virginia are authorized or obligated by law or executive order to be closed.

 

Closing Date:
The date or dates, set forth in the related PPTL, on which the Purchaser will purchase and the Seller will sell the Mortgage Loans
identified therein.

 

CLTV: Combined
Loan-to-Value Ratio.

 

Code: The Internal
Revenue Code of 1986, as amended, or any successor statute thereto.

 

Commission:
The United States Securities and Exchange Commission.

 

Condemnation Proceeds:
All awards, compensation and settlements in respect of a taking (whether permanent or temporary) of all or part of a Mortgaged
Property by exercise of the power of condemnation or the right of eminent domain, to the extent not required to be released to
a Mortgagor in accordance with the terms of the related Mortgage Loan Documents.

 

Consumer Information:
Any personally identifiable information in any form (written electronic or otherwise) relating to a Mortgagor, including, but not
limited to: a Mortgagor’s name, address, telephone number, Mortgage Loan number, Mortgage Loan payment history, delinquency
status, insurance carrier or payment information, tax amount or payment information; the fact that the Mortgagor has a relationship
with the Seller or Servicer or the originator of the related Mortgage Loan; and any other non-public personally identifiable information.

 

    	3

    	 

    

 

Cooperative Corporation:
With respect to any Cooperative Loan, the cooperative apartment corporation that holds legal title to the related Cooperative Project
and grants occupancy rights to units therein to stockholders through Cooperative Leases or similar arrangements.

 

Cooperative Lease:
The lease on a Cooperative Unit evidencing the possessory interest of the owner of the Cooperative Shares in such Cooperative Unit.

 

Cooperative Loan:
A Mortgage Loan that is secured by a first lien on and perfected security interest in Cooperative Shares and the related Cooperative
Lease granting exclusive rights to occupy the related Cooperative Unit in the building owned by the related Cooperative Corporation.

 

Cooperative Project:
With respect to any Cooperative Loan, all real property and improvements thereto and rights therein and thereto owned by a Cooperative
Corporation including without limitation the land, separate dwelling units and all common elements.

 

Cooperative Shares:
With respect to any Cooperative Loan, the shares of stock issued by a Cooperative Corporation and allocated to a Cooperative Unit
and represented by a stock certificate.

 

Cooperative Unit:
With respect to a Cooperative Loan, a specific unit in a Cooperative Project.

 

Credit Score: For
each Mortgage Loan, (a) if two credit scores were obtained at origination, the lowest score of the two, and (b) if three scores
were obtained at origination, the middle of the three. When there is more than one applicant, the lowest of the applicants’
Credit Scores will be used. There is only one (1) score for any Mortgage Loan regardless of the number of borrowers and/or applicants.

 

Custodial Account:
As defined in Subsection 11.04.

 

Customary Servicing
Procedures: With respect to any Mortgage Loan, those mortgage servicing practices (including collection procedures) of prudent
mortgage banking institutions which service mortgage loans of the same type as such Mortgage Loan in the jurisdiction where the
related Mortgaged Property is located, and which are in accordance with Fannie Mae servicing practices and procedures for MBS pool
mortgages, as defined in the Fannie Mae Guides including future updates, or as such mortgage servicing practices may change from
time to time.

 

    	4

    	 

    

 

Cut-off Date:
With respect to each Mortgage Loan, the first day of the month of the related Closing Date as set forth in the related PPTL.

 

Deleted Mortgage
Loan: A Mortgage Loan replaced or to be replaced with a Substitute Mortgage Loan in accordance with this Agreement.

 

Delinquent:
Any Mortgage Loan with respect to which the Monthly Payment due on a Due Date is not made by the close of business on the Business
Day preceding the next scheduled Due Date for such Mortgage Loan.

 

Due Date: The
day of the month on which the Monthly Payment is due on a Mortgage Loan, exclusive of any days of grace.

 

Eligible Account:
Any account or accounts maintained with a federal or state chartered depository institution or trust company the short-term and
long-term unsecured debt obligations of which (or, in the case of a depository institution or trust company that is the principal
subsidiary of a holding company, the debt obligations of such holding company) are rated in the highest rating category of each
Rating Agency with respect to short-term unsecured debt obligations and in one of the two highest rating categories of each Rating
Agency with respect to long-term unsecured debt obligations at the time any amounts are held on deposit therein. Eligible Accounts
may bear interest. If the rating of the short-term or long-term unsecured debt obligations of the depository institution or trust
company that maintains the account or accounts is no longer in the highest rating category of each Rating Agency with respect to
short-term unsecured debt obligations or in one of the two highest rating categories of each Rating Agency with respect to long-term
unsecured debt obligations, the funds on deposit therewith in connection with this Agreement shall be transferred to an Eligible
Account within 30 days of such downgrade.

 

Escrow Account:
As defined in Subsection 11.06.

 

Escrow Payments:
The amounts constituting ground rents, taxes, assessments, Primary Mortgage Insurance Policy premiums, fire and hazard insurance
premiums, flood insurance premiums, condominium charges and other payments as may be required to be escrowed by the Mortgagor with
the Mortgagee pursuant to the terms of any Mortgage Note or Mortgage.

 

Event of Default:
Any one of the conditions or circumstances enumerated in Subsection 13.01.

 

Fannie Mae:
The entity formerly known as the Federal National Mortgage Association or any successor thereto.

 

Fannie Mae Guides:
The Fannie Mae Sellers’ Guide and the Fannie Mae Servicers’ Guide and all amendments or additions thereto in effect
on and after the related Closing Date.

 

    	5

    	 

    

 

FDIC: The Federal
Deposit Insurance Corporation or any successor thereto.

 

FDPA: The Flood
Disaster Protection Act of 1973, as amended.

 

Fidelity Bond:
The fidelity bond required to be obtained by the Seller pursuant to Subsection 11.12.

 

FIRREA: The
Financial Institutions Reform, Recovery, and Enforcement Act of 1989, as amended and in effect from time to time.

 

First Remittance
Date: With respect to each Mortgage Loan Package, the 18th day (or if such 18th day is not a Business Day, the first Business
Day immediately preceding such 18th day) of the calendar month immediately following the Closing Date; provided, however,
if the Servicing Transfer Date is not one (1) or more Business Days prior to the first day of such calendar month, such date will
be the 18th day (or if such 18th day is not a Business Day, the first Business Day immediately preceding such 18th day)
of the next succeeding calendar month.

 

Freddie Mac:
The entity formerly known as the Federal Home Loan Mortgage Corporation or any successor thereto.

 

Freddie Mac Guide:
The Freddie Mac Single Family Seller/Servicer Guide and all amendments or additions thereto in effect on and after the related
Closing Date.

 

Full Prepayment:
Any payment of the entire principal balance of a Mortgage Loan which is received in advance of its scheduled Due Date and is not
accompanied by an amount of interest representing scheduled interest due on any date or dates in any month or months subsequent
to the month of prepayment.

 

Ginnie Mae:
The Government National Mortgage Association or any successor thereto.

 

Gross Margin:
With respect to any Adjustable Rate Mortgage Loan, the fixed percentage amount set forth in the related Mortgage Note and the Mortgage
Loan Schedule that is added to the Index on each Adjustment Date in accordance with the terms of the related Mortgage Note to determine
the new Mortgage Interest Rate for such Mortgage Loan.

 

HUD: The United
States Department of Housing and Urban Development or any successor thereto.

 

Independent:
When used with respect to any other Person, a Person who (a) is in fact independent of another specified Person and any affiliate
of such other Person, (b) does not have any material direct financial interest in such other Person or any affiliate of such other
Person, and (c) is not connected with such other Person or any affiliate of such other Person as an officer, employee, promoter,
underwriter, trustee, partner, director or Person performing similar functions.

 

    	6

    	 

    

 

Index: With
respect to any Adjustable Rate Mortgage Loan, the index identified on the Mortgage Loan Schedule and set forth in the related Mortgage
Note for the purpose of calculating the Mortgage Interest Rate thereon.

 

Initial Rate Cap:
With respect to each Adjustable Rate Mortgage Loan and the initial Adjustment Date therefor, a number of percentage points per
annum that is set forth in the Mortgage Loan Schedule and in the related Mortgage Note, which is the maximum amount by which the
Mortgage Interest Rate for such Adjustable Rate Mortgage Loan may increase or decrease from the Mortgage Interest Rate in effect
immediately prior to such Adjustment Date.

 

Insurance Proceeds:
With respect to each Mortgage Loan, proceeds of insurance policies insuring the Mortgage Loan or the related Mortgaged Property.

 

Interim Servicing
Period: The period from the Closing Date to the related Servicing Transfer Date.

 

IO Adjustable
Rate Mortgage Loan: An Adjustable Rate Mortgage Loan with respect to which accrued interest only is payable by a Mortgagor
on each Due Date until the IO Conversion Date.

 

IO Conversion
Date: With respect to an IO Adjustable Rate Mortgage Loan, the date that references the end of the “interest only period”
applicable thereto.

 

Lifetime Rate Cap:
As to each Adjustable Rate Mortgage Loan, the maximum Mortgage Interest Rate which shall be as permitted in accordance with the
provisions of the related Mortgage Note.

 

Liquidation Proceeds:
The proceeds received in connection with the liquidation of a defaulted Mortgage Loan through trustee’s sale, foreclosure
sale or otherwise, other than amounts received following the acquisition of REO Property, Insurance Proceeds and Condemnation Proceeds.

 

Loan-to-Value Ratio:
With respect to any Mortgage Loan as of any date of determination, the ratio, expressed as a percentage, of the outstanding principal
balance of the Mortgage Loan on such date, to the Appraised Value of the related Mortgaged Property.

 

LPMI: Lender
paid mortgage insurance.

 

    	7

    	 

    

 

LTV: Loan-to-Value
Ratio.

 

Master Servicer:
Wells Fargo Bank, N.A., together with its successors and assigns, as master servicer with respect to any Securitization Transaction,
or any other master servicer designated as such with respect to any Securitization Transaction.

 

MERS: Mortgage
Electronic Registration Systems, Inc., a corporation organized and existing under the laws of the State of Delaware, or any successor
thereto.

 

MERS Mortgage Loan:
Any Mortgage Loan registered with MERS on the MERS System.

 

MERS System:
The system of recording transfers of mortgages electronically maintained by MERS.

 

MIN: The Mortgage
Identification Number for any MERS Mortgage Loan.

 

Minimum Interest
Rate: With respect to each Adjustable Rate Mortgage Loan, a rate that is set forth on the Mortgage Loan Schedule and in the
related Mortgage Note and is the minimum interest rate to which the Mortgage Interest Rate on such Mortgage Loan may be decreased.

 

Monthly Payment:
The scheduled monthly payment on a Mortgage Loan due on any Due Date allocable to principal and/or interest on such Mortgage Loan
pursuant to the terms of the related Mortgage Note.

 

Mortgage: The
mortgage, deed of trust or other instrument securing a Mortgage Note which creates a first lien on an unsubordinated estate in
fee simple in real property securing the Mortgage Note; except that with respect to real property located in jurisdictions in which
the use of leasehold estates for residential properties is a widely-accepted practice, the mortgage, deed of trust or other instrument
securing the Mortgage Note may secure and create a first lien upon a leasehold estate of the Mortgagor.

 

Mortgage File:
With respect to each Mortgage Loan, all documents involved in the origination, underwriting (including documented compensating
factors pertaining to exceptions) and servicing of the Mortgage Loan, including but not limited to the documents specified in Exhibit
2, and any additional documents required to be added to the Mortgage File pursuant to this Agreement.

 

Mortgage Interest
Rate: With respect to each Mortgage Loan, the annual rate at which interest accrues on such Mortgage Loan from time to time
in accordance with the provisions of the related Mortgage Note, including, but not limited to, the limitations on such interest
rate imposed by the Initial Rate Cap, the Periodic Rate Cap, the Minimum Interest Rate and the Lifetime Rate Cap, if any.

 

    	8

    	 

    

 

Mortgage Loan:
An individual Mortgage Loan that is the subject of this Agreement, each Mortgage Loan originally sold and subject to this Agreement
being identified on the related Mortgage Loan Schedule, which Mortgage Loan includes without limitation the Mortgage File, the
Servicing File, the Monthly Payments, Principal Prepayments, Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds, REO
Disposition Proceeds, any escrow accounts related to the Mortgage Loan, the Servicing Rights and all other rights, benefits, proceeds
and obligations arising from or in connection with such Mortgage Loan, excluding replaced or repurchased mortgage loans.

 

Mortgage Loan Documents:
With respect to any Mortgage Loan, the documents listed in Exhibit 1 hereto.

 

Mortgage Loan Package:
The pool or group of whole loans purchased on a Closing Date, as described in the Mortgage Loan Schedule annexed to the related
PPTL.

 

Mortgage Loan Remittance
Rate: With respect to any Mortgage Loan, the related Mortgage Interest Rate minus the related Servicing Fee Rate.

 

Mortgage Loan Schedule:
The schedule of Mortgage Loans prepared for each Closing Date setting forth the information with respect to each Mortgage Loan
required by the disclosure report format of the Purchaser, which disclosure report format is delivered by the Purchaser to the
Seller.

 

Mortgage Note:
The note or other evidence of the indebtedness of a Mortgagor secured by a Mortgage or, in the case of a Cooperative Loan, secured
by the Cooperative Shares and the Cooperative Lease.

 

Mortgaged Property:
The Mortgagor’s real property securing repayment of a related Mortgage Note, consisting of a fee simple interest in a single
parcel of real property improved by a Residential Dwelling.

 

Mortgagee: The
mortgagee or beneficiary named in the Mortgage and the successors and assigns of such mortgagee or beneficiary.

 

Mortgagor: The
obligor on a Mortgage Note, who is an owner of the Mortgaged Property and the grantor or mortgagor named in the Mortgage and such
grantor’s or mortgagor’s successors in title to the Mortgaged Property.

 

NAIC:
The National Association of Insurance Commissioners or any successor organization.

 

OCC: The Office
of the Comptroller of the Currency or any successor thereto.

 

    	9

    	 

    

 

Officer’s
Certificate: A certificate signed by the Chairman of the Board, the Vice Chairman of the Board, a President or a Vice President
of the Person on behalf of whom such certificate is being delivered.

 

Opinion of Counsel:
A written opinion of counsel, who may be salaried counsel for the Person on behalf of whom the opinion is being given, reasonably
acceptable to each Person to whom such opinion is addressed, and which must be Independent outside counsel with respect to such
opinion of counsel concerning the taxation or the federal income tax status of a REMIC.

 

Partial Prepayment:
Any payment of principal on a Mortgage Loan, other than a Full Prepayment, which is received in advance of its scheduled Due Date
and is not accompanied by an amount of interest representing scheduled interest due on any date or dates in any month or months
subsequent to the month of prepayment.

 

Periodic Rate Cap:
As to each Adjustable Rate Mortgage Loan, the maximum increase or decrease in the Mortgage Interest Rate, on any Adjustment Date
as provided in the related Mortgage Note, if applicable.

 

Person: An individual,
corporation, partnership, joint venture, association, joint-stock company, limited liability company, trust, unincorporated organization
or government or any agency or political subdivision thereof.

 

PPTL: With respect
to each Mortgage Loan and Mortgage Loan Package, the Purchase Price and Terms Letter, substantially in the form of Exhibit 3
attached hereto, providing for the sale by Seller and the purchase by the Purchaser of the Mortgage Loan Package on the related
Closing Date.

 

Prepayment Charge:
With respect to each Mortgage Loan, the fee payable by the Mortgagor if the Mortgagor prepays such Mortgage Loan as provided in
the related Mortgage Note or Mortgage.

 

Prepayment Interest
Shortfall: As to any Remittance Date and any Mortgage Loan, (a) if such Mortgage Loan was the subject of a Full Prepayment
during the related Principal Prepayment Period, the excess of one month’s interest (adjusted to the Mortgage Loan Remittance
Rate) on the Assumed Principal Balance of such Mortgage Loan outstanding immediately prior to such prepayment, over the amount
of interest (adjusted to the Mortgage Loan Remittance Rate) actually paid by the Mortgagor in respect of such Principal Prepayment
Period, and (b) if such Mortgage Loan was the subject of a Partial Prepayment during the related Principal Prepayment Period, an
amount equal to the excess of one month’s interest at the Mortgage Loan Remittance Rate on the amount of such Partial Prepayment,
over the amount of interest actually paid by the Mortgagor in respect of such Partial Prepayment during such Principal Prepayment
Period.

 

Primary Mortgage
Insurance Policy: A policy of primary mortgage guaranty insurance.

 

    	10

    	 

    

 

Principal Prepayment:
Any full or partial payment or other recovery of principal on a Mortgage Loan which is received in advance of its scheduled Due
Date, including any Prepayment Charge or premium thereon and which is not accompanied by an amount of interest representing scheduled
interest due on any date or dates in any month or months subsequent to the month of prepayment.

 

Principal Prepayment
Period: As to any Remittance Date, the calendar month preceding the calendar month in which such Remittance Date occurs.

 

Purchase Price:
The price paid on the related Closing Date by the Purchaser to the Seller pursuant to this Agreement in exchange for the Mortgage
Loans included in the related Mortgage Loan Package, as calculated pursuant to Section 4 and the related PPTL.

 

Purchase Price Percentage:
For each Mortgage Loan included in a Mortgage Loan Package, the percentage of par set forth in the related PPTL that is used to
calculate the Purchase Price of the Mortgage Loans included in such Mortgage Loan Package.

 

Purchaser: The
Person listed as such in the initial paragraph of this Agreement, together with its successors and assigns as permitted under the
terms of this Agreement.

 

Qualified Appraiser:
With respect to each Mortgage Loan, an appraiser, duly appointed by the originator, who had no interest, direct or indirect in
the Mortgaged Property or in any loan made on the security thereof, and whose compensation is not affected by the approval or disapproval
of the Mortgage Loan, and such appraiser and the appraisal made by such appraiser both satisfy the requirements of Fannie Mae or
Freddie Mac (including but not limited to the Appraiser Independence Requirements) and Title XI of FIRREA and the regulations promulgated
thereunder, all as in effect on the date the Mortgage Loan was originated.

 

Qualified Insurer:
An insurance company duly qualified as such under the laws of the states in which the Mortgaged Properties are located, duly authorized
and licensed in such states to transact the applicable insurance business and to write the insurance provided by the insurance
policy issued by it, approved as an insurer by Fannie Mae and Freddie Mac.

 

Rating Agencies:
Standard & Poor’s Ratings Services, a division of The McGraw- Hill Companies, Inc., Moody’s Investors Service,
Inc., Fitch, Inc. or, in the event that some or all ownership of the Mortgage Loans is evidenced by mortgage-backed securities,
the nationally recognized rating agencies issuing ratings with respect to such securities, if any.

 

Reconciled Market
Value: The estimated market value of the Mortgaged Property or REO Property that is reasonably determined by the Seller based
on different results obtained from different permitted valuation methods or at different time periods, all in accordance with Customary
Servicing Procedures.

 

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Reconstitution Agreement:
The agreement or agreements entered into by the Seller, the Purchaser and certain third parties on the Reconstitution Date or Reconstitution
Dates with respect to any or all of the Mortgage Loans conveyed hereunder, in connection with a Whole Loan Transfer or a Securitization
Transaction as provided in Subsection 32. A Reconstitution Agreement relating to a Securitization Transaction will be substantially
in the form of Exhibit 5 hereto.

 

Reconstitution Date:
The date or dates on which any or all of the Mortgage Loans are reconstituted as part of a Whole Loan Transfer or Securitization
Transaction pursuant to Section 32 hereof.

 

Record Date:
The close of business of the last Business Day of the month preceding the month of the related Remittance Date or, in the case
of a Remittance Date that is the Servicing Transfer Date, the Business Day prior to the Servicing Transfer Date.

 

Refinanced Mortgage
Loan: A Mortgage Loan which was made to a Mortgagor who owned the Mortgaged Property prior to the origination of such Mortgage
Loan and the proceeds of which were used in whole or part to satisfy an existing mortgage.

 

Regulation AB:
Subpart 229.1100 – Asset Backed Securities (Regulation AB), 17 C.F.R. §§229.1100-229.1123, as such may be amended
from time to time, and subject to such clarification and interpretation as have been provided by the Commission in the adopting
release (Asset-Backed Securities, Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005)) or by the staff
of the Commission, or as may be provided by the Commission or its staff from time to time.

 

Regulation AB Compliance
Addendum: Addendum I attached hereto and incorporated herein by reference thereto.

 

REMIC: A “real
estate mortgage investment conduit” within the meaning of Section 860D of the Code.

 

Remittance Date:
(a) The 18th day (or if such 18th day is not a Business Day, the first Business Day immediately preceding such 18th
day) of any month, beginning with the First Remittance Date with respect to each Mortgage Loan Package, and (b) the Servicing Transfer
Date.

 

REO Disposition:
The final sale by the Seller or the Purchaser of an REO Property.

 

REO Disposition
Proceeds: All amounts received with respect to an REO Disposition pursuant to Subsection 11.13.

 

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REO Property:
A Mortgaged Property acquired by or on behalf of the Purchaser through foreclosure or deed in lieu of foreclosure as described
in Subsection 11.13.

 

Repurchase Price:
With respect to any Mortgage Loan, a price equal to (i) the unpaid principal balance of the Mortgage Loan, plus, (ii) interest
on such unpaid principal balance at the related Mortgage Interest Rate from the last date through which interest was last paid
and distributed to the Purchaser to the last day of the month in which such repurchase occurs, plus, (iii) reasonable and customary
third party expenses incurred in connection with the transfer of the Mortgage Loan being repurchased, minus (iv) any amounts received
in respect of such repurchased Mortgage Loan and being held in the Custodial Account for future distribution in connection with
such Mortgage Loan.

 

Residential Dwelling:
Any one of the following: (i) a detached one-family dwelling, (ii) a detached two- to four-family dwelling, (iii) a one-family
dwelling unit in a condominium project or (iv) a one-family dwelling in a planned unit development, none of which is a cooperative,
mobile or manufactured home.

 

Securities Act:
The Securities Act of 1933, as amended.

 

Securitization Transaction:
Any transaction involving either (1) a sale or other transfer of some or all of the Mortgage Loans directly or indirectly by the
Purchaser to an issuing entity in connection with an issuance of publicly offered or privately placed, rated or unrated mortgage-backed
securities or (2) an issuance of publicly offered or privately placed, rated or unrated securities, the payments on which are determined
primarily by reference to one or more portfolios of residential mortgage loans consisting, in whole or in part, of some or all
of the Mortgage Loans.

 

Seller: George
Mason Mortgage, LLC, or its successor in interest or any successor to the Seller under this Agreement appointed as herein provided.

 

Servicer: The
Servicer set forth in the related PPTL.

 

Servicing Advances:
All customary, reasonable and necessary out-of-pocket costs and expenses incurred in the performance by the Seller or the Servicer
of its servicing obligations, including, but not limited to, the cost of (a) the preservation, restoration and protection
of a Mortgaged Property, (b) any enforcement or judicial proceedings, including foreclosures, (c) the management and
liquidation of a Mortgaged Property if such Mortgaged Property is acquired in satisfaction of the Mortgage, and (d) payments
made by the Seller or the Servicer with respect to a Mortgaged Property pursuant to Subsection 11.08.

 

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Servicing Fee:
With respect to each Mortgage Loan, the fee the Purchaser shall pay to the Seller to interim service the Mortgage Loans, which
shall, for each month, be equal to one-twelfth of the product of the applicable Servicing Fee Rate and the Stated Principal Balance
of such Mortgage Loan (pro-rated with respect to partial months). Such fee shall be payable monthly. The obligation of the Purchaser
to pay the Servicing Fee is limited to, and payable solely from, the interest portion (including recoveries with respect to interest
from Liquidation Proceeds and other proceeds, to the extent permitted by Subsection 11.05) of related Monthly Payments collected
by the Seller, or as otherwise provided under Subsection 11.05.

 

Servicing Fee Rate:
With respect to each Mortgage Loan, the per annum rate set forth on the related Mortgage Loan Schedule or if not specified thereon,
in the related PPTL.

 

Servicing File:
With respect to each Mortgage Loan, the documents pertaining thereto specified in Exhibit 2 and copies of all documents
for such Mortgage Loan specified in Exhibit 1.

 

Servicing Rights:
With respect to each Mortgage Loan, any and all of the following: (a) all rights to service the Mortgage Loan; (b) all rights to
receive the Servicing Fees, additional servicing compensation (including, without limitation, any late fees, assumption fees, penalties
or similar payments with respect to the Mortgage Loan, and income on escrow accounts or other receipts on or with respect to the
Mortgage Loan), reimbursements or indemnification for servicing the Mortgage Loan, and any payments received in respect of the
foregoing and proceeds thereof; (c) the right to collect, hold and disburse escrow payments or other similar payments with respect
to the Mortgage Loans and any amounts actually collected with respect thereto and to receive interest income on such amounts to
the extent permitted by applicable law; (d) all accounts and other rights to payment related to any of the property described in
this paragraph; (e) possession and use of any and all Mortgage Loan Documents and Mortgage Files pertaining to the Mortgage Loans
or pertaining to the past, present or prospective servicing of the Mortgage Loans; (f) all rights and benefits relating to the
direct solicitation of the related Mortgagors for refinance or modification of the Mortgage Loans and attendant right, title and
interest in and to the list of such Mortgagors and data relating to their respective Mortgage Loans; (g) all rights, powers and
privileges incident to any of the foregoing; and (h) all agreements or documents creating, defining or evidencing any of the foregoing
rights to the extent they relate to such rights.

 

Servicing Transfer
Date: The date or dates, set forth in the related PPTL, when the Servicer will begin servicing the Mortgage Loans for the benefit
of the Purchaser.

 

Servicing Transfer
Instructions: The servicing transfer instructions in the form of Exhibit 4 hereto.

 

Stated Principal
Balance: As to each Mortgage Loan as to any date of determination, (i) the principal balance of the Mortgage Loan as of
the first day of the month for which such calculation is being made after giving effect to the principal portion of any Monthly
Payments due on or before such date, whether or not received, as well as any Principal Prepayments received before such date, minus,
without duplication, (ii) all amounts previously distributed to the Purchaser with respect to the Mortgage Loan representing
payments or recoveries of principal, or advances in lieu thereof.

 

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Substitute Mortgage
Loan: A mortgage loan substituted by the Seller for a Deleted Mortgage Loan which must, on the date of such substitution, be
approved by the Purchaser and meet the conditions described in Section 7.03(b) of this Agreement.

 

Underwriting Guidelines:
As to each Mortgage Loan Package, the written underwriting guidelines in effect as of the origination date of such Mortgage Loans,
mutually agreed upon by the Seller and Purchaser, and delivered by the Seller to the Purchaser, as may be revised and modified,
from time to time, by mutual agreement of the Purchaser and the Seller to reflect changes to the Underwriting Guidelines.

 

USA Patriot Act:
Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, as amended.

 

USPAP: The Uniform
Standards of Professional Appraisal Practice, as amended and in effect from time to time.

 

Whole Loan Transfer:
Any sale or transfer by the Purchaser of some or all of the Mortgage Loans (including an Agency Transfer), other than a Securitization
Transaction.

 

SECTION
2. Purchase and Conveyance.

 

The Seller, in exchange
for the payment of the applicable Purchase Price by the Purchaser on the related Closing Date, receipt of which is hereby acknowledged,
hereby sells, transfers, assigns, sets over and conveys to the Purchaser, without recourse, but subject to the terms of this Agreement,
all of its rights, title and interest in and to the Mortgage Loans, including the related Mortgage Note and Mortgages, in a Mortgage
Loan Package having a Stated Principal Balance in an amount as set forth in the related PPTL, or in such other amount as agreed
by the Purchaser and the Seller as evidenced by the actual aggregate principal balance of the Mortgage Loan Package accepted by
the Purchaser on the related Closing Date, together with the related Mortgage Files and all rights and obligations arising under
the documents contained therein, on a servicing released basis.

 

With respect to each
Mortgage Loan, the Purchaser shall own and be entitled to (1) all Monthly Payments due after the related Cut-off Date, (2) all
other recoveries of principal collected after the related Cut-off Date (provided, however, that the principal portion of all Monthly
Payments due on or before the related Cut-off Date and collected by the Seller or any successor servicer after the related Cut-off
Date shall belong to the Seller), and (3) all payments of interest on the Mortgage Loans (minus that portion of any such payment
which is allocable to the period prior to the related Cut-off Date). The Stated Principal Balance of each Mortgage Loan as of the
related Cut-off Date is determined after application of payments of principal due on or before the related Cut-off Date whether
or not collected, together with any unscheduled Principal Prepayments collected prior to the related Cut-off Date; provided, however,
that Monthly Payments for a Due Date beyond the Cut-off Date shall not be applied to reduce the principal balance. Such Monthly
Payments shall be the property of the Purchaser. If the Servicing Transfer Date has not yet occurred, the Seller shall remit any
such Monthly Payments to the Purchaser on the Remittance Date following collection thereof. If the Servicing Transfer Date has
occurred, the Seller shall remit any such Monthly Payments to the Purchaser in accordance with the Servicing Transfer Instructions.

 

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SECTION
3. Mortgage Loan Schedule.

 

The
Seller shall deliver the Mortgage Loan Schedule (which will be annexed to the related PPTL) to the Purchaser at least two (2)
Business Days prior to the related Closing Date. 

 

SECTION
4. Purchase Price.

 

The Purchase Price
for the Mortgage Loans being acquired on a Closing Date shall be equal to the sum of (a) the product of (i) the Purchase Price
Percentage stated in the related PPTL (subject to adjustment as provided therein) and (ii) the Stated Principal Balance of the
Mortgage Loans listed on the related Mortgage Loan Schedule, plus (b) an amount equal to accrued interest on the aggregate
Stated Principal Balance of the Mortgage Loans at the weighted average Mortgage Interest Rate of such Mortgage Loans from the related
Cut-off Date through the day prior to the related Closing Date, both inclusive (assuming 30/360) (the “Purchase Price”).
If so provided in the related PPTL, portions of the Mortgage Loans shall be priced separately.

 

The Purchase Price
as set forth in the preceding paragraph for the Mortgage Loans shall be paid on the related Closing Date by wire transfer of immediately
available funds.

 

SECTION
5. Examination of Mortgage Files.

 

The Seller shall, at
the direction of the Purchaser, deliver to the Purchaser or its designee in escrow, for examination and retention, with respect
to each Mortgage Loan to be purchased on the related Closing Date, the related Mortgage File in hard copy or in digital format
on compact disks or DVD. Such examination may be made by the Purchaser or its designee at any reasonable time before or after the
related Closing Date. The Purchaser may, at its option and without notice to the Seller, purchase all or part of the Mortgage Loan
Package without conducting any partial or complete examination. The fact that the Purchaser has conducted or has determined not
to conduct any partial or complete examination of the Mortgage Files shall not affect the Purchaser’s (or any of its successors’)
rights to demand repurchase or other relief or remedy provided for in this Agreement.

 

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SECTION
6. Delivery of Mortgage Loan Documents.

 

Subsection
6.01 Possession of Mortgage Files.

 

Originals or copies
of all documents, including but not limited to the documents listed on Exhibit 2 and comprising the Mortgage File, other than the
Mortgage Loan Documents, shall be delivered to the Purchaser or its designee on or prior to the related Closing Date. During the
Interim Servicing Period, originals of the contents of each Mortgage File not delivered to the Purchaser or the custodian appointed
by the Purchaser are and shall be held in trust by the Seller for the benefit of the Purchaser as the owner thereof and shall be
available for review by the Purchaser upon request. The Seller’s possession of any portion of each such Mortgage File is
at the will of the Purchaser, and such retention and possession by the Seller shall be in a custodial capacity only. The ownership
of each Mortgage Note, Mortgage and the contents of each Mortgage File is vested in the Purchaser and the ownership of all records
and documents with respect to the related Mortgage Loan prepared by or which come into the possession of the Seller shall immediately
vest in the Purchaser and shall be retained and maintained, in trust, by the Seller at the will of the Purchaser in such custodial
capacity only. The copies of the Mortgage File retained by the Seller with respect to each Mortgage Loan pursuant to this Agreement
shall be appropriately identified in the Seller’s computer system to reflect clearly the ownership of such related Mortgage
Loan by the Purchaser. The Seller shall release from its custody the contents of any Mortgage File retained by it only in accordance
with this Agreement and the Servicing Transfer Instructions, except when such release is required in connection with a repurchase
of any such Mortgage Loan pursuant to Subsection 7.03 of this Agreement or if required under applicable law or court order.

 

Subsection
6.02 Books and Records.

 

The sale of each Mortgage
Loan will be reflected on the Seller’s balance sheet and other financial statements as a sale of assets by the Seller. The
Seller shall maintain a complete set of books and records for the Mortgage Loans sold by it which shall be appropriately identified
in the Seller’s computer system to clearly reflect the ownership of the Mortgage Loans by the Purchaser.

 

In addition to the
foregoing, the Seller shall provide to any supervisory agents or examiners that regulate the Purchaser, including but not limited
to, the OCC, the FDIC and other similar entities, access, during normal business hours, upon reasonable advance notice to the Seller
and without charge to the Seller or such supervisory agents or examiners, to any documentation regarding the Mortgage Loans that
may be required by any applicable regulator.

 

Subsection
6.03 Delivery of Mortgage Loan Documents.

 

The Seller shall deliver
and release to the Purchaser or the custodian appointed by the Purchaser the Mortgage Loan Documents no later than four (4) Business
Days prior to the related Closing Date or, upon the request of the Purchaser, earlier, if necessary or desirable to facilitate
a review. If the Seller cannot deliver the original recorded Mortgage Loan Documents on the related Closing Date, the Seller shall,
promptly upon receipt thereof and in any case not later than 180 days from the Closing Date, deliver such original recorded Mortgage
Loan Documents to the Purchaser or the appointed custodian (unless the Seller is delayed in making such delivery by reason of the
fact that such documents shall not have been returned by the appropriate recording office). If delivery is not completed within
180 days of the related Closing Date solely because such Mortgage Loan Documents shall not have been returned by the appropriate
recording office, the Seller shall deliver such Mortgage Loan Documents to Purchaser, or the appointed custodian, within such time
period as specified in a Seller’s Officer’s Certificate. In the event that documents have not been received by the
date specified in the Seller’s Officer’s Certificate, a subsequent Seller’s Officer’s Certificate shall
be delivered by such date specified in the prior Seller’s Officer’s Certificate, stating a revised date for receipt
of documentation. The Seller shall include with each Seller’s Officer’s Certificate a listing of all delayed recorded
documents. The procedure shall be repeated until the documents have been received and delivered. The Seller shall use its best
efforts to effect delivery of all delayed recorded documents within 180 days of the related Closing Date. If delivery of all Mortgage
Loan Documents with respect to any Mortgage Loan is not completed within 360 days of the related Closing Date then, at Purchaser’s
option, the Seller shall repurchase such Mortgage Loan in such manner set forth in Section 7.03.

 

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Any review by the Purchaser
or its designee of the Mortgage Files shall in no way alter or reduce the Seller’s obligations hereunder.

 

If the Purchaser or
its designee discovers any material defect with respect to any document constituting part of a Mortgage File, the Purchaser shall,
or shall cause its designee to, give written specification of such defect to the Seller and the Seller shall cure or repurchase
such Mortgage Loan in accordance with Section 7.03.

 

The Seller shall forward
to the Purchaser, or its designee, original documents evidencing an assumption, modification, consolidation or extension of any
Mortgage Loan entered into within one week of their execution and shall also provide the original of any document submitted for
recordation or a copy of such document certified by the appropriate public recording office to be a true and complete copy of the
original within five (5) days of its return from the appropriate public recording office.

 

Subsection
6.04 RESPA Notice.

 

Prior to each Servicing
Transfer Date, the Seller shall furnish to the applicable Mortgagors notices required under the Real Estate Settlement Procedure
Act (“RESPA”) within the time frames required by RESPA..

 

SECTION
7. Representations, Warranties and Covenants; Remedies for Breach.

 

Subsection
7.01 Representations and Warranties Regarding Individual Mortgage Loans.

 

The Seller hereby represents
and warrants to the Purchaser that, as to each Mortgage Loan, as of the related Closing Date or such other date specified herein:

 

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(a)          Property
Valuation: Each Mortgage File contains a written appraisal prepared by an appraiser licensed or certified by the applicable
governmental body in which the mortgaged property is located and in accordance with the requirements of Title XI of FIRREA. The
appraisal was written, in form and substance, to (i) customary Fannie Mae or Freddie Mac standards for mortgage loans of the same
type as such Mortgage Loans and (ii) USPAP standards, and satisfies applicable legal and regulatory requirements. The appraisal
was made and signed prior to the final approval of the Mortgage Loan application. The person performing any property valuation
(including an appraiser) received no benefit from, and such person's compensation or flow of business from the originator was not
affected by, the approval or disapproval of the Mortgage Loan. The selection of the person performing the property valuation was
made independently of the broker (where applicable) and the originator's loan sales and loan production personnel. The selection
of the appraiser met the criteria of Fannie Mae and Freddie Mac for selecting an independent appraiser.

 

(b)          Income/Employment/Assets:
With respect to each Mortgage Loan the originator verified the borrower's income, employment, and assets in accordance with its
written Underwriting Guidelines and employed procedures designed to authenticate the documentation supporting such income, employment,
and assets. Such verification includes the transcripts received from the Internal Revenue Service pursuant to a filing of IRS Form
4506-T. With respect to each Mortgage Loan, in order to test the reasonableness of the income, the originator used (i) transcripts
received from the IRS pursuant to a filing of IRS Form 4506-T (to the extent specified in the Mortgage Loan Schedule) or (ii) public
and/or commercially available information acceptable to the Purchaser.

 

(c)          Occupancy:
The originator has given due consideration to factors, including but not limited to, other real estate owned by the borrower, commuting
distance to work, appraiser comments and notes, the location of the property and any difference between the mailing address active
in the servicing system and the subject property address to evaluate whether the occupancy status of the property as represented
by the borrower is reasonable. All owner occupied properties are occupied by the owner at the time of purchase of the mortgage.

 

(d)          Data:
The information set forth in the related Mortgage Loan Schedule, including any diskette or other related data tapes sent to the
Purchaser, is complete, true and correct in all material respects. The information on the Mortgage Loan Schedule and the information
provided are consistent with the contents of the originator's records and the Mortgage File. The Mortgage Loan Schedule contains
all of the required fields. Any seller or builder concession has been subtracted from the Appraised Value of the Mortgaged Property
for purposes of determining the LTV and CLTV. Except for information specified to be as of the origination date of the Mortgage
Loan, the Mortgage Loan Schedule contains the most current information possessed by the originator. No appraisal or other property
valuation referred to or used to determine any data listed on the Mortgage Loan Schedule was more than 120 days old at the time
of the Mortgage Loan closing.

 

(e)          Fraud:
No fraud, error, omission, misrepresentation, negligence or similar occurrence with respect to the Mortgage Loan has taken place
on the part of the Mortgagor, the Seller or any other Person, including, without limitation, any appraiser, title company, closing
or settlement agent, realtor, builder or developer or any other party involved in the origination or sale of the Mortgage Loan
or the sale of the Mortgaged Property, that would impair in any way the rights of the Purchaser in the Mortgage Loan or Mortgaged
Property or that violated applicable law.

 

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(f)          Underwriting;
Collection Practices; Escrow Payments: Each Mortgage Loan either (i) was underwritten in conformance with the originator's
Underwriting Guidelines in effect at the time of origination without regard to any underwriter discretion or (ii) if not underwritten
in conformance with the originator's guidelines, has reasonable and documented compensating factors. The methodology used in underwriting
the extension of credit for the Mortgage Loan includes objective mathematical principles that relate to the relationship between
the borrower's income, assets and liabilities and the proposed payment. With respect to escrow deposits and mortgage escrow accounts,
all such payments are in the possession of Seller and there exist no deficiencies in connection therewith for which customary arrangements
for repayment thereof have not been made. All escrow payments have been collected in full compliance with state and federal law.
An escrow of funds is not prohibited by applicable law and has been established in an amount sufficient to pay for every item subject
to an escrow requirement which remains unpaid and which has been assessed but is not yet due and payable. Except in connection
with a modification disclosed on the Mortgage Loan Schedule and contained in the Servicing File, no escrow deposits or escrow payments
or other charges or payments due the Seller have been capitalized under the Mortgage or the Mortgage Note. With respect to each
Adjustable Rate Mortgage Loan, all mortgage interest rate adjustments and monthly payment adjustments have been made in strict
compliance with Customary Servicing Procedures, and, as of the applicable Transfer Date, Seller’s servicing system has been
updated to reflect any such adjustments. The Seller executed and delivered any and all notices required under applicable law and
the terms of the related Mortgage Note and Mortgage regarding the Mortgage Interest Rate and the monthly payment adjustments. Any
interest required to be paid to the Mortgagor pursuant to state, federal and local law has been properly paid and credited.

 

(g)          Mortgage
Insurance: Except as indicated for pledged asset loans, if a Mortgage Loan has an LTV greater than 80%, the Mortgage Loan has
mortgage insurance in accordance with the terms of the Fannie Mae Guide or the Freddie Mac Guide and is insured as to payment defaults
by a Primary Mortgage Insurance Policy issued by a Qualified Insurer. All provisions of such Primary Mortgage Insurance Policy
have been and are being complied with, such policy is in full force and effect and all premiums due thereunder have been paid.
No action, inaction or event has occurred and no state of facts exists that has, or will result in the exclusion from, denial of,
or defense to coverage. Any Mortgage Loan subject to a Primary Mortgage Insurance Policy obligates the Mortgagor thereunder to
maintain the Primary Mortgage Insurance Policy and to pay all premiums and charges in connection therewith. To the extent a Mortgage
Loan is insured under an LPMI policy, the Mortgage Interest Rate for the Mortgage Loan as set forth on the related Mortgage Loan
Schedule is net of any such premium.

 

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(h)          Regulatory
Compliance: Any and all requirements of any federal, state or local law including, without limitation, usury, truth-in-lending,
real estate settlement procedures, consumer credit protection, equal credit opportunity, fair housing, or disclosure laws applicable
to the Mortgage Loan have been complied with in all material respects. No Mortgage Loan is a “high cost” or “covered”
loan, as defined by any applicable federal, state or local predatory or abusive lending law. Any breach of this representation
shall be deemed to materially and adversely affect the value of the Mortgage Loan and shall require a repurchase of the affected
Mortgage Loan. No Mortgage Loan secured by property located in the State of Georgia was originated on or after October 1, 2002
and prior to March 7, 2003. No Mortgage Loan originated on or after March 7, 2003 is a “high cost home loan” as defined
under the Georgia Fair Lending Act. No borrower was encouraged or required to select a loan product offered by an originator that
was a higher cost product designed for less-creditworthy borrowers, unless at the time of the Mortgage Loan's origination, such
borrower did not qualify, taking into account credit history and debt-to-income ratios, for a lower cost credit product then offered
by such originator or any affiliate of such originator. There does not exist on the related Mortgaged Property any hazardous substances,
hazardous wastes or solid wastes, as such terms are defined in the Comprehensive Environmental Response Compensation and Liability
Act, the Resource Conservation and Recovery Act of 1976, or other federal, state or local environmental legislation including,
without limitation, asbestos. There is no pending action or proceeding directly involving the Mortgaged Property in which compliance
with any environmental law, rule or regulation is an issue; there is no violation of any environmental law, rule or regulation
with respect to the Mortgaged Property; and nothing further remains to be done to satisfy in full all requirements of each such
law, rule or regulation constituting a prerequisite to use and enjoyment of such Mortgaged Property. The Seller has complied with
all applicable anti-money laundering laws and regulations, including without limitation the USA Patriot Act of 2001 (collectively,
the “Anti-Money Laundering Laws”); the Seller has established an anti-money laundering compliance program as required
by the Anti-Money Laundering Laws, has conducted the requisite due diligence in connection with the origination of each Mortgage
Loan for purposes of the Anti-Money Laundering Laws, including with respect to the legitimacy of the applicable Mortgagor and the
origin of the assets used by said Mortgagor to purchase the property in question, and maintains, and will maintain, sufficient
information to identify the applicable Mortgagor for purposes of the Anti-Money Laundering Laws. The servicing of each Mortgage
Loan prior to the related Closing Date complied in all material respects with the Customary Servicing Procedures and all then-applicable
federal, state and local laws. Any breach of any representations made in this clause (h) shall be deemed to materially and adversely
affect the value of the Mortgage Loan and shall require a repurchase of the affected Mortgage Loan.

 

(i)          Borrower:
As of the related Closing Date, the Mortgagor is not in bankruptcy and is not insolvent and the Seller has no knowledge of any
circumstances or condition with respect to the Mortgage, the Mortgaged Property, the Mortgagor or the Mortgagor's credit standing
that could reasonably be expected to cause investors to regard the Mortgage Loan as an unacceptable investment, cause the Mortgage
Loan to become delinquent or materially adversely affect the value or marketability of the Mortgage Loan. Either the Mortgagor
is a natural person who is legally permitted to reside in the United States or the Mortgagor is an inter-vivos trust acceptable
to Fannie Mae. No borrower had a prior bankruptcy in the last seven years. No borrower previously owned a property in the last
seven years that was the subject of a foreclosure during the time the borrower was the owner of record.

 

(j)          Source
of Loan Payments: No loan payment has been escrowed as part of the loan proceeds on behalf of the borrower. No payments due
and payable under the terms of the Mortgage Note and Mortgage or deed of trust, except for seller or builder concessions, have
been paid by any person who was involved in, or benefited from, the sale or purchase of the Mortgaged Property or the origination,
refinancing, sale, purchase or servicing of the Mortgage Loan other than the borrower.

  

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(k)          Down
Payment: The Mortgagor has contributed at least 5% of the purchase price for the Mortgaged Property with his/her own funds.

 

(l)          No
Prior Liens: The Seller is the sole owner and holder of the Mortgage Loan and the indebtedness evidenced by the Mortgage Note,
and upon recordation the Purchaser or its designee will be the owner of record of the Mortgage and the indebtedness evidenced by
the Mortgage Note, and upon the sale of the Mortgage Loan to the Purchaser, the Seller will retain any Mortgage File documents
during the Interim Servicing Period in its possession in trust for the Purchaser. Each sale of the Mortgage Loan from any prior
owner or the Seller was in exchange for fair equivalent value, and the prior owner or the Seller, as applicable, was solvent both
prior to and after the transfer and had sufficient capital to pay and was able to pay its debts as they would generally mature.
Immediately prior to the transfer and assignment to the Purchaser on the related Closing Date, the Mortgage Loan, including the
Mortgage Note and the Mortgage, was not subject to an assignment or pledge, and the Seller had good and marketable title to and
was the sole owner thereof and had full right to transfer and sell the Mortgage Loan to the Purchaser free and clear of any encumbrance,
equity, lien, pledge, charge, claim or security interest. The Seller has the full right and authority subject to no interest or
participation of, or agreement with, any other party, to sell and assign the Mortgage Loan pursuant to this Agreement and following
the sale of the Mortgage Loan, the Purchaser will own such Mortgage Loan free and clear of any encumbrance, equity, participation
interest, lien, pledge, charge, claim or security interest. The Seller intends to relinquish all rights to possess, control and
monitor the Mortgage Loan.

 

(m)          Enforceability
and Priority of Lien: The related Mortgage is a valid, subsisting, enforceable and perfected first lien on the Mortgaged Property
(subject, as to enforceability, to bankruptcy and other creditors rights laws), including all buildings on the Mortgaged Property,
and all installations and mechanical, electrical, plumbing, heating and air conditioning systems affixed to such buildings, and
all additions, alterations and replacements made at any time with respect to the foregoing securing the Mortgage Note's original
principal balance. The Mortgage and the Mortgage Note do not contain any evidence of any security interest or other interest or
right thereto. Such lien is free and clear of all adverse claims, liens and encumbrances having priority over the first lien of
the Mortgage subject only to (1) the lien of non-delinquent current real property taxes and assessments not yet due and payable,
(2) covenants, conditions and restrictions, rights of way, easements and other matters of the public record as of the date of recording
which are acceptable to mortgage lending institutions generally and either (A) which are referred to or otherwise considered in
the appraisal made for the originator of the Mortgage Loan, or (B) which do not adversely affect the Appraised Value of the Mortgaged
Property as set forth in such appraisal and (3) other matters to which like properties are commonly subject which do not materially
interfere with the benefits of the security intended to be provided by the Mortgage or the use, enjoyment, value or marketability
of the related Mortgaged Property. Any security agreement, chattel mortgage or equivalent document related to and delivered in
connection with the Mortgage Loan establishes and creates a valid, subsisting, enforceable and perfected first lien and first priority
security interest on the property described therein (subject, as to enforceability, to bankruptcy and other creditors rights laws),
and the Seller has the full right to sell and assign the same to the Purchaser; There are no mechanics' or similar liens or claims
which have been filed for work, labor or material (and no rights are outstanding that under law could give rise to such liens)
affecting the related Mortgaged Property which are or may be liens prior to or equal to the lien of the related Mortgage. The related
original Mortgage has been recorded or is in the process of being recorded.

  

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(n)          Complete
Mortgage Files: The Mortgage Note, the Mortgage, the Assignment of Mortgage and the other Mortgage Loan Documents set forth
in Exhibits 1 and 2 and required to be delivered on the related Closing Date have been delivered to the Purchaser or its designee
in compliance with the specific requirements of this Agreement and the PPTL for the related Mortgage Loan Package. With respect
to each Mortgage Loan, the Seller is in possession of a complete Mortgage File including all documents used in the qualification
of the borrower except for such documents as have been delivered to the Purchaser or its designee. In the event the Mortgage is
a deed of trust, a trustee, authorized and duly qualified under applicable law to serve as such, has been properly designated,
is named in the Mortgage and currently so serves, and no fees or expenses are or will become payable by the Purchaser to the trustee
under the deed of trust, except in connection with a trustee's sale after default by the borrower.

 

(o)          No
Modifications: The terms of the Mortgage Note and the Mortgage have not been impaired, waived, altered or modified in any material
respect, except by a written instrument that, if required by applicable law, has been recorded or is in the process of being recorded.
The substance of any such waiver, alteration or modification has been approved by the issuer of any related Primary Mortgage Insurance
Policy and title insurance policy, to the extent required by such policies, the terms of such waiver, alteration or modification
have been reflected in the Mortgage Loan Schedule and the written instrument reflecting such terms has been included in the Mortgage
File. No Mortgagor has been released, in whole or in part, from the terms of the Mortgage Note and the Mortgage, except in connection
with an assumption agreement which is part of the Mortgage File and the terms of which are reflected in the related Mortgage Loan
Schedule. The Mortgage and Mortgage Note have not been satisfied, canceled or subordinated, in whole or in part, or rescinded,
and the Mortgaged Property has not been released from the lien of the Mortgage, in whole or in part, nor has any instrument been
executed that would effect any such release, cancellation, subordination or rescission. The Seller has not waived the performance
by the Mortgagor of any action, if the Mortgagor's failure to perform such action would cause the Mortgage Loan to be in default,
nor has the Seller waived any default resulting from any action or inaction by the Mortgagor.

 

(p)          Taxes
Paid: All taxes, governmental assessments, insurance premiums, water, sewer and municipal charges, leasehold payments or ground
rents which previously became due and owing have been paid by the borrower, or escrow funds from the borrower have been established
in an amount sufficient to pay for every such escrowed item which remains unpaid and which has been assessed but is not yet due
and payable.

 

(q)          No
Damage/Condemnation: Each Mortgaged Property is undamaged by waste, vandalism, fire, hurricane, earthquake or earth movement,
windstorm, flood, tornado or other casualty adversely affecting the value of a Mortgaged Property or the use for which the premises
were intended, and each Mortgaged Property is in substantially the same condition it was at the time the most recent Appraised
Value was obtained. There is no proceeding pending or threatened for the total or partial condemnation of any Mortgaged Property.

  

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(r)          Fee
Simple Estate / No Encroachments / Compliance with Zoning: The Mortgage creates a first lien or a first priority ownership
interest in an estate in fee simple in real property securing the related Mortgage Note. All improvements subject to the Mortgage
which were considered in determining the Appraised Value of the Mortgaged Property lie wholly within the boundaries and building
restriction lines of the Mortgaged Property (and wholly within the project with respect to a condominium unit), no improvements
on adjoining properties encroach upon the Mortgaged Property except those which are insured against by the title insurance policy
referred to in clause (v) below and all improvements on the property comply with all applicable building, zoning and subdivision
laws, regulations and ordinances.

 

(s)          Legally
Occupied: As of the related Closing Date, the Mortgaged Property is lawfully occupied under applicable law, and all inspections,
licenses and certificates required to be made or issued with respect to all occupied portions of the Mortgaged Property and, with
respect to the use and occupancy of the same, including but not limited to certificates of occupancy and fire underwriting certificates,
have been made or obtained from the appropriate authorities.

 

(t)          Mortgage
Loan Legal and Binding: The Mortgage Note, the Mortgage and other agreements executed in connection therewith are original
and genuine and each is the legal, valid and binding obligation of the maker thereof, enforceable in all respects in accordance
with its terms subject to bankruptcy, insolvency, moratorium, reorganization and other laws of general application affecting the
rights of creditors and by general equitable principles. The Seller has taken all action necessary to transfer such rights of enforceability
to the Purchaser. All parties to the Mortgage Note, the Mortgage and other agreements executed in connection therewith, had the
legal capacity to enter into the Mortgage Loan and to execute and deliver the Mortgage Note and the Mortgage. The Mortgage Note
and the Mortgage have been duly and properly executed by such parties.

 

(u)          Proceeds
Fully Disbursed / Recording Fees Paid: The proceeds of the Mortgage Loan have been fully disbursed and there is no requirement
for future advances thereunder, and any and all requirements as to completion of any on-site or off-site improvements and as to
disbursements of any escrow funds therefor have been complied with. All costs, fees and expenses incurred in making or closing
the Mortgage Loan and the recording of the Mortgage were paid or are in the process of being paid, and the Mortgagor is not entitled
to any refund of any amounts paid or due under the Mortgage Note or Mortgage.

 

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(v)         Existence
of Title Insurance: Each Mortgage Loan (except (1) any Mortgage Loan secured by a Mortgaged Property located in any jurisdiction
as to which an opinion of counsel of the type customarily rendered in such jurisdiction in lieu of title insurance is instead received
and (2) any Mortgage Loan secured by Cooperative Shares) is covered by an ALTA lender's title insurance policy or other form of
policy or insurance generally acceptable to Fannie Mae or Freddie Mac, issued by a title insurer acceptable to Fannie Mae or Freddie
Mac and qualified to do business in the jurisdiction where the Mortgaged Property is located, insuring (subject to the exceptions
contained in (m)(1), (2) and (3) above) the Seller, its successors and assigns, as to the first priority lien of the Mortgage in
the original principal amount of the Mortgage Loan. Additionally, such policy affirmatively insures ingress and egress to and from
the Mortgaged Property. Where required by applicable state law or regulation, the Mortgagor has been given the opportunity to choose
the carrier of the required mortgage title insurance. The Seller, its successors and assigns, are the sole insureds of such lender's
title insurance policy; such title insurance policy has been duly and validly endorsed to the Purchaser or the assignment to the
Purchaser of the Seller's interest therein does not require the consent of or notification to the insurer; and such lender's title
insurance policy is in full force and effect and will be in full force and effect upon the consummation of the transactions contemplated
by this Agreement and the related PPTL. No claims have been made under such lender's title insurance policy, and no prior holder
of the related Mortgage, including the Seller, has done, by act or omission, anything which would impair the coverage of such lender's
title insurance policy. No originator, seller, prior owner of the Mortgage Loan or other Person has provided or received any unlawful
fee, commission, kickback, or other compensation or value of any kind in connection with the title insurance policy.

 

(w)          Hazard
Insurance: All buildings or other customarily insured improvements upon the Mortgaged Property are insured by an insurer acceptable
under the Fannie Mae Guides, against loss by fire, hazards of extended coverage and such other hazards as are provided for in the
Fannie Mae Guides or by the Freddie Mac Guides, in an amount representing coverage not less than the lesser of (i) the maximum
insurable value of the improvements securing such Mortgage Loans and (ii) the greater of (a) the outstanding principal balance
of the Mortgage Loan and (b) an amount such that the proceeds thereof shall be sufficient to prevent the Mortgagor and/or the Mortgagee
from becoming a co-insurer. If the Mortgaged Property is a condominium unit, it is included under the coverage afforded by a blanket
policy for the project. If required by the FDPA, the Mortgage Loan is covered by a flood insurance policy meeting the requirements
of the current guidelines of the Federal Insurance Administration and conforming to Fannie Mae and Freddie Mac requirements, in
an amount not less than the amount required by the FDPA. Such policy was issued by an insurer acceptable under the Fannie Mae Guides
or the Freddie Mac Guides. The Mortgage obligates the Mortgagor thereunder to maintain all such insurance at the Mortgagor's cost
and expense, and upon the Mortgagor's failure to do so, authorizes the holder of the Mortgage to maintain such insurance at the
Mortgagor's cost and expense and to seek reimbursement therefor from the Mortgagor. All such standard hazard and flood policies
are in full force and effect and on the date of origination contained a standard mortgagee clause naming the Seller and its successors
in interest and assigns as loss payee; such clause is still in effect and all premiums due on any such policies have been paid
in full. No originator, seller, prior owner of the Mortgage Loan, borrower or any other Person, has engaged in any act or omission
that would impair the coverage of any such insurance policy, the benefits of the endorsement provided for therein, or the validity
and binding effect of either, including, without limitation, the provision or receipt of any unlawful fee, commission, kickback,
or other compensation or value of any kind. No action, inaction, or event has occurred and no state of facts exists or has existed
that has resulted or will result in the exclusion from, denial of, or defense to coverage under any such insurance policies, regardless
of the cause of such failure of coverage.

 

(x)          No
Default: There is no default, breach, violation or event of acceleration existing under the Mortgage or the related Mortgage
Note and no event which, with the passage of time or with notice and the expiration of any grace or cure period, would constitute
a default, breach, violation or event permitting acceleration; and neither the Seller nor any prior mortgagee has waived any default,
breach, violation or event permitting acceleration. No foreclosure action is currently threatened or has been commenced with respect
to any Mortgaged Property.

  

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(y)          No
Rescission: The Mortgage Note and the Mortgage are not subject to any right of rescission, set-off, counterclaim or defense,
including, without limitation, the defense of usury, nor will the operation of any of the terms of the Mortgage Note or the Mortgage,
or the exercise of any right thereunder, render the Mortgage Note or Mortgage unenforceable, in whole or in part, or subject to
any right of rescission, set-off, counterclaim or defense, including the defense of usury, and no such right of rescission, set-off,
counterclaim or defense has been asserted with respect thereto. The Mortgagor was not a debtor at the time of origination of the
Mortgage Loan and is not currently a debtor in any state or federal bankruptcy or insolvency proceeding.

 

(z)          Enforceable
Right of Foreclosure: The Mortgage relating to a Mortgaged Property contains customary and enforceable provisions such as to
render the rights and remedies of the holder thereof adequate for the realization against such Mortgaged Property of the benefits
of the security provided thereby. There is no homestead or other exemption available to the Mortgagor which would interfere with
the right to sell the Mortgaged Property at a trustee's sale or the right to foreclose on the Mortgage.

 

(aa)        Mortgaged
Property is 1-4 Family: The Mortgaged Property consists of a single parcel of real property with a detached single family residence
erected thereon, or a townhouse, or a two-to four-family dwelling, or an individual condominium unit in a condominium project,
or an individual unit in a planned unit development or a de minimis planned unit development, provided, however, that no residence
or dwelling is a mobile home. As of the date of origination, no portion of the Mortgaged Property was used for commercial purposes,
and since the date of origination no portion of the Mortgaged Property has been used for commercial purposes.

 

(bb)       Mortgage
Loan Qualifies for REMIC: Each Mortgage Loan constitutes a qualified mortgage under Section 860G(a)(3)(A) of the Code and Treasury
Regulations Section 1.860G-2(a)(l).

 

(cc)        Original
Mortgage Notes: The Seller has delivered to the Purchaser the original Mortgage Note with respect to each Mortgage Loan. No
Mortgage Loan is subject to a lost note affidavit.

 

(dd)       Doing
Business: All parties which have had any interest in the Mortgage, whether as Mortgagee, assignee, pledgee or otherwise, are
(or, during the period in which they held and disposed of such interest, were) (A) in compliance with any and all applicable licensing
requirements of the laws of the state wherein the Mortgaged Property is located and (B) (1) organized under the laws of such state,
(2) qualified to do business in such state, (3) a federal savings and loan association, a national bank, a Federal Home Loan Bank
or a savings bank having principal offices in such state or (4) not doing business in such state.

  

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(ee)        Loans
Current / Prior Delinquencies: All payments due on a Mortgage Loan on or prior to the related Closing Date have been made as
of the related Closing Date, no Mortgage Loan is Delinquent and no Mortgage Loan has been Delinquent during the preceding twelve-month
period; no payment made on such Mortgage Loan has been dishonored; there are no material defaults under the terms of such Mortgage
Loan; and neither the Seller nor any other party has advanced funds or induced, solicited or knowingly received any advance of
funds from a party other than the owner of the Mortgaged Property subject to the Mortgage, directly or indirectly, for the payment
of any amount required by the Mortgage Loan.

 

(ff)         [Reserved]

 

(gg)       Acceleration
of Payments: The Mortgage contains the usual and enforceable provisions of the originator at the time of origination for the
acceleration of the payment of the unpaid principal amount of the Mortgage Loan if the related Mortgaged Property is sold without
the prior consent of the Mortgagee thereunder.

 

(hh)        [Reserved]

 

(ii)          Leasehold
Interest Representation And Warranty: To the extent the Mortgage Loan is secured by a leasehold interest: (1) the borrower
is the owner of a valid and subsisting interest as tenant under the lease and is not in default thereunder, (2) the lease is in
full force and effect, and is unmodified, (3) all rents and other charges have been paid when due, (4) the lessor under the lease
is not in default, (5) the execution, delivery, and performance of the Mortgage do not require the consent (other than the consents
that have been obtained and are in full force and effect) under, and will not violate or cause a default under, the terms of the
lease, (6) the lease is assignable or transferable, (7) the term of such lease does not terminate earlier than five years after
the maturity date of the Mortgage Note, (8) the lease does not provide for termination of the lease in the event of the borrower's
default without written notice to the Mortgagee and a reasonable opportunity to cure the default, (9) the lease permits the mortgaging
of the related Mortgaged Property and (10) the lease protects the Mortgagee's interests in the event of a property condemnation.

 

(jj)          Sole
Collateral: As of the related Closing Date, the Mortgage Note is not and has not been secured by any collateral other than
the lien of the corresponding Mortgage and the security interest of any applicable security agreement or chattel mortgage referred
to in clause (m) above, and such collateral does not serve as security for any other obligation.

 

(kk)        Full
Disclosure: The Mortgagor has received all disclosure materials required by applicable law with respect to the making of fixed
rate or adjustable rate mortgage loans, as applicable.

 

(ll)          No
Graduated Payments: The Mortgage Loan does not contain “graduated payment” features, does not have a shared appreciation
or other contingent interest feature and does not contain any buydown provisions.

 

(mm)      No
Negative Amortization Loans: The Mortgage Loans have an original term to maturity of not more than 30 years, with interest
payable in arrears on the first day of each month. Each Mortgage Note requires a monthly payment which is sufficient to fully amortize
the original principal balance over the original term thereof (except in the case of interest only loans) and to pay interest at
the related Mortgage Interest Rate. No Mortgage Loan contains terms or provisions which would result in negative amortization.

  

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(nn)         Recordable:
As to any Mortgage Loan which is not a MERS Mortgage Loan, the Assignment of Mortgage is in recordable form and is acceptable for
recording under the laws of the jurisdiction in which the Mortgaged Property is located.

 

(oo)         Payment
Terms: Payments on the Mortgage Loan commenced no more than sixty (60) days after the funds were disbursed in connection with
the Mortgage Loan. The Mortgage Note is payable on the first day of each month in equal monthly installments of principal and interest
(if not an interest only loan), with interest calculated and payable in arrears, sufficient to amortize the Mortgage Loan fully
by the stated maturity date, over an original term of not more than thirty years from commencement of amortization.

 

(pp)         Condominiums:
If the Mortgaged Property is a condominium unit or a planned unit development (other than a de minimis planned unit development),
or stock in a cooperative housing corporation, such condominium, cooperative or planned unit development project meets the eligibility
requirements of Fannie Mae and Freddie Mac.

 

(qq)         Servicemembers’
Civil Relief Act: The Mortgagor has not notified the Seller that it is requesting relief under the Servicemembers' Civil Relief
Act, and the Seller has no knowledge of any relief requested or allowed to the Mortgagor under the Servicemembers' Civil Relief
Act.

 

(rr)           Construction:
As of the related Closing Date, no Mortgage Loan was in construction or rehabilitation status and no trade-in or exchange of a
Mortgaged Property has been facilitated.

 

(ss)          Qualified
Lender: The Mortgage Loan was originated by a Mortgagee approved by the Secretary of Housing and Urban Development pursuant
to Sections 203 and 211 of the National Housing Act, a savings and loan association, a savings bank, a commercial bank, credit
union, insurance company or similar institution supervised and examined by a federal or state authority.

 

(tt)           No
Ground Leases: No Mortgaged Property is subject to a ground lease.

 

(uu)         No
Additional Fees: With respect to any broker fees collected and paid on any of the Mortgage Loans, all such fees have been properly
assessed to the Mortgagor and no claims will arise as to such fees that are double charged and for which the Mortgagor would be
entitled to reimbursement.

 

(vv)         Home
Ownership and Equity Protection Act 1994: None of the Mortgage Loans are subject to the Home Ownership and Equity Protection
Act of 1994 or any comparable state law.

 

(ww)       No
Single Credit Insurance: None of the proceeds of the Mortgage Loan were used to finance single premium credit insurance policies.

 

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(xx)        Principal
Advances: Any principal advances made to the Mortgagor prior to the related Closing Date have been consolidated with the outstanding
principal amount secured by the Mortgage, and the secured principal amount, as consolidated, bears a single interest rate and single
repayment term. The lien of the Mortgage securing the consolidated principal amount is expressly insured as having first lien priority
by a title insurance policy, an endorsement to the policy insuring the Mortgagee's consolidated interest or by other title evidence
acceptable to Fannie Mae and Freddie Mac. The consolidated principal amount does not exceed the original principal amount of the
Mortgage Loan.

 

(yy)         Interest
Calculation: Interest on each Mortgage Loan is calculated on the basis of a 360-day year consisting of twelve 30-day months.

 

(zz)          No
Balloon Loans: No Mortgage Loan is a Balloon Mortgage Loan.

 

(aaa)       MERS
Mortgage Loans: With respect to each MERS Mortgage Loan, a MIN has been assigned by MERS and such MIN is accurately provided
on the Mortgage Loan Schedule. The related Assignment of Mortgage to MERS has been duly and properly recorded. With respect to
each MERS Mortgage Loan, the Seller has not received any notice of liens or legal actions with respect to such Mortgage Loan and
no such notices have been electronically posted by MERS.

 

(bbb)       Credit
Reporting: With respect to each Mortgage Loan, the Seller has fully and accurately furnished complete information on the related
borrower credit files to Equifax, Experian and Trans Union Credit Information in accordance with the Fair Credit Reporting Act
and its implementing regulations.

 

(ccc)        Servicing.
The Mortgage Loans have been serviced in accordance with all Applicable Requirements.

 

(ddd)       Loan
Type. No Mortgage Loan is a “pay option ARM,” “pick-a-payment” or similar type of mortgage loan or
a home equity revolving line of credit.

 

(eee)       Flood
Certifications. Unless otherwise agreed upon by the Seller and the Purchaser, each Mortgage Loan is covered by a life of loan,
transferable flood certification contract assignable to the Purchaser.

 

Subsection
7.02 Seller Representations and Covenants.

 

The Seller hereby
represents, warrants and covenants to the Purchaser that, as to itself as of the related Closing Date (or such other date as is
specified below):

 

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(a)          It
is a Virginia limited liability company, duly organized, validly existing, and in good standing under the laws of the Commonwealth
of Virginia and has all licenses necessary to carry on its business as now being conducted and is licensed, qualified and in good
standing in the states where each Mortgaged Property is located if the laws of such state require licensing or qualification in
order to conduct business of the type conducted by it. It is an approved seller in good standing of conventional residential mortgage
loans for Fannie Mae or Freddie Mac and is a HUD-approved mortgagee under Section 203 of the National Housing Act. It has
corporate power and authority to execute and deliver this Agreement and to perform in accordance herewith; the execution, delivery
and performance of this Agreement (including all instruments of transfer to be delivered pursuant to this Agreement) by it and
the consummation of the transactions contemplated hereby have been duly and validly authorized. This Agreement, assuming due authorization,
execution and delivery by the Purchaser, evidences the legal, valid, binding and enforceable obligation of it, subject to applicable
law except as enforceability may be limited by (i) bankruptcy, insolvency, liquidation, receivership, moratorium, reorganization
or other similar laws affecting the enforcement of the rights of creditors and (ii) general principles of equity, whether
enforcement is sought in a proceeding in equity or at law. All requisite corporate action has been taken by it to make this Agreement
valid and binding upon it in accordance with the terms of this Agreement.

 

(b)          No
consent, approval, authorization or order is required for the transactions contemplated by this Agreement from any court, governmental
agency or body, or federal or state regulatory authority having jurisdiction over it or, if required, such consent, approval, authorization
or order has been or will, prior to the related Closing Date, be obtained.

 

(c)          The
consummation of the transactions contemplated by this Agreement are in its ordinary course of business and will not result in the
breach of any term or provision of its articles of association or by-laws or result in the breach of any term or provision of,
or conflict with or constitute a default under or result in the acceleration of any obligation under, any agreement, indenture
or loan or credit agreement or other instrument to which it or its property is subject, or result in the violation of any law,
rule, regulation, order, judgment or decree to which it or its property is subject.

 

(d)          Its
transfer, assignment and conveyance of the Mortgage Notes and the Mortgages pursuant to this Agreement are not subject to the bulk
transfer or any similar statutory provisions in effect in any applicable jurisdiction.

 

(e)          There
is no action, suit, proceeding or investigation pending or, to its best knowledge, threatened against it which, either individually
or in the aggregate, would result in any material adverse change in its business, operations, financial condition, properties or
assets, or in any material impairment of its right or ability to carry on its business substantially as now conducted or which
would draw into question the validity of this Agreement or the Mortgage Loans or of any action taken or to be taken in connection
with its obligations contemplated herein, or which would materially impair its ability to perform under the terms of this Agreement.

 

(f)          To
the best of the Seller’s knowledge, the Seller is not in material default under any agreement, contract, instrument or indenture
to which the Seller is a party or by which it (or any of its assets) is bound, which default would have a material adverse effect
on the ability of the Seller to perform under this Agreement, nor, to the best of the Seller’s knowledge, has any event occurred
which, with the giving of notice, the lapse of time or both, would constitute a default under any such agreement, contract, instrument
or indenture and have a material adverse effect on the ability of the Seller to perform its obligations under this Agreement.

 

(g)          It
does not believe, nor does it have any reason or cause to believe, that it cannot perform each and every covenant contained in
this Agreement.

  

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(h)           As
of the Servicing Transfer Date, the Seller has previously serviced and administered the Mortgage Loans in accordance with Customary
Servicing Procedures, all applicable federal, state and local laws and the related Mortgage Notes and Mortgages.

 

(i)           
It has determined that the disposition of the Mortgage Loans pursuant to this Agreement will be afforded sale treatment for accounting
and tax purposes.

 

(j)            It
is solvent and the sale of the Mortgage Loans will not cause it to become insolvent. The sale of the Mortgage Loans is not undertaken
with the intent to hinder, delay or defraud any of its creditors.

 

(k)           It
has not dealt with any broker, investment banker, agent or other person that may be entitled to any commission or compensation
in connection with the sale of the Mortgage Loans.

 

(l)            To
the best of the Seller’s knowledge, neither this Agreement nor any statement, report or other agreement, document or instrument
furnished or to be furnished pursuant to this Agreement contains any materially untrue statement of fact or omits to state a fact
necessary to make the statements contained therein not misleading.

 

(m)          (i)          The
Seller covenants that the transfer of servicing of each Mortgage Loan from the Seller to the Servicer shall be complete in all
material respects by the related Servicing Transfer Date, and the transfer shall be in accordance with the Servicing Transfer Instructions.

 

(ii)         Unless
otherwise mutually agreed to by the Seller and the Purchaser, if a breach of the covenant described in Subsection 7.02(m)(i) continues
for more than five (5) Business Days following the related Transfer Date, the Seller shall be required to repurchase the related
Mortgage Loan at the Repurchase Price, and such repurchase shall be accomplished by wire transfer of the amount of the Repurchase
Price to an account designated by the Purchaser.

  

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Subsection
7.03 Repurchase; Substitution.

 

(a)          It
is understood and agreed that the representations and warranties set forth in Sections 7.01 and 7.02 shall survive the sale of
the Mortgage Loans and delivery of the Mortgage File to the Purchaser, or its designee, and shall inure to the benefit of the Purchaser,
notwithstanding any restrictive or qualified endorsement on any Mortgage Note or Assignment or the examination, or lack of examination,
of any Mortgage Loan Document. Upon discovery by the Seller or the Purchaser of a breach of any of the foregoing representations
and warranties which materially and adversely affects the value of the Mortgage Loans or the interest of the Purchaser in the Mortgage
Loans (or which materially and adversely affects the value of a particular Mortgage Loan or the interest of the Purchaser in a
particular Mortgage Loan in the case of a representation and warranty relating to such particular Mortgage Loan), the party discovering
such breach shall give prompt written notice to the other. A breach of representations and warranties in Sections 7.01(e) through
(p), (r), (t), (v), (w), (x), (y), (z), (aa), (bb), (cc), (ee), (gg), (hh), (jj), (ll), (mm), (nn), (qq), (ss), (uu), (vv), (ww),
(xx), (yy), (zz), (aaa), and (bbb) shall be deemed to materially and adversely affect the value of the related Mortgage Loan or
the interest of the Purchaser in any Mortgage Loan. With respect to the representations and warranties contained in Sections 7.01
and 7.02 that are made to the Seller’s knowledge or to the best of Seller’s knowledge, if it is discovered by either
the Seller or the Purchaser that the substance of such representation and warranty is inaccurate and such inaccuracy materially
and adversely affects the value of the related Mortgage Loan or the interest of the Purchaser in the related Mortgage Loan, the
Purchaser shall be entitled to all the remedies to which it would be entitled for a breach of representation or warranty, including,
without limitation, the repurchase requirements contained herein, notwithstanding Seller’s lack of knowledge with respect
to the inaccuracy at the time the representation or warranty was made. The Seller shall have a period of sixty (60) days from the
earlier of its discovery or its receipt of notice of any such breach within which to correct or cure such breach; provided,
however, that if a Mortgage Loan has been transferred to a REMIC and the breach is with respect to the representation and warranty
in Section 7.01(bb), the Seller shall have a period of sixty (60) days from its discovery of such breach within which to cure such
breach. The Seller hereby covenants and agrees that if any such breach is not corrected or cured within such sixty (60) day period,
the Seller shall, at the Purchaser’s option, (i) repurchase such Mortgage Loan at the Repurchase Price, (ii) substitute a
mortgage loan for the defective Mortgage Loan as provided below or (iii) except for a breach of the representation and warranty
in Section 7.01(bb), make an indemnification payment in an amount equal to the reduction in value of such Mortgage Loan as a result
of such breach, such payment to be made in the manner set forth above in respect of the Purchase Price of a repurchased Mortgage
Loan. In the event that any such breach shall involve any representation or warranty set forth in Section 7.02, and such breach
is not cured within sixty (60) days of the earlier of either discovery by or notice to the Seller of such breach, all affected
Mortgage Loans shall, at the option of the Purchaser, be repurchased by the Seller at the Repurchase Price. Any such repurchase
shall be accomplished by wire transfer of the amount of the Repurchase Price to an account designated by the Purchaser. If the
breach of representation and warranty that gave rise to the obligation to repurchase or substitute a Mortgage Loan pursuant to
this Section 7.03(a) was the representation and warranty set forth in clause (e) or (h) of Section 7.01, then the Seller shall
pay to the Purchaser, concurrently with and in addition to the remedies provided in this Section 7.03(a), an amount equal to any
liability, penalty or expense that was actually incurred and paid out of or on behalf of the Purchaser, and that directly resulted
from such breach, or if incurred and paid by the Purchaser thereafter, concurrently with such payment.

 

(b)          If
the Seller is required to repurchase any Mortgage Loan pursuant to this Subsection 7.03 as a result of a breach of any of the representations
and warranties set forth in Subsection 7.01, the Seller may, with the Purchaser’s prior consent, within two (2) years from
the related Closing Date, remove such defective Mortgage Loan from the terms of this Agreement and substitute another mortgage
loan for such defective Mortgage Loan, in lieu of repurchasing such defective Mortgage Loan. Any Substitute Mortgage Loan shall
(a) have a principal balance at the time of substitution not in excess of the principal balance of the Deleted Mortgage Loan (the
amount of any difference, plus one month’s interest thereon at the Mortgage Loan Remittance Rate borne by the Deleted Mortgage
Loan, being paid by the Seller and deemed to be a Principal Prepayment to an account designated by the Purchaser), (b) have a Mortgage
Interest Rate not less than, and not more than one percentage point greater than, the Mortgage Interest Rate of the Deleted Mortgage
Loan or in the case of an Adjustable Rate Mortgage Loan, have the same index, a margin that is not less than the margin of the
Deleted Mortgage Loan and Adjustment Dates that are the same frequency as that of the Deleted Mortgage Loan, (c) have a remaining
term to stated maturity not later than, and not more than one year less than, the remaining term to stated maturity of the Deleted
Mortgage Loan, (d) be, in the reasonable determination of the Purchaser, of the same type, quality and character (including location
of the Mortgaged Property) as the Deleted Mortgage Loan as if the breach had not occurred, (e) have a Loan-to-Value Ratio at origination
no greater than that of the Deleted Mortgage Loan, (f) have the same lien priority as that of the Deleted Mortgage Loan and (g)
be, in the reasonable determination of the Purchaser, in material compliance with the representations and warranties contained
in this Agreement and described in Subsection 7.01 as of the date of substitution.

  

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(c)          The
Seller shall amend the related Mortgage Loan Schedule to reflect the withdrawal of the Deleted Mortgage Loan from this Agreement
and the substitution of such substitute Mortgage Loan therefor. Upon such amendment, the Purchaser shall review the Mortgage File
delivered to it relating to the substitute Mortgage Loan. The Monthly Payment on a substitute Mortgage Loan due on the Due Date
in the month of substitution shall be the property of the Seller and the Monthly Payment on the Deleted Mortgage Loan for which
the substitution is made due on such date shall be the property of the Purchaser.

 

(d)          It
is understood and agreed that the obligation of the Seller set forth in this Subsection 7.03 to cure, repurchase or substitute
for a defective Mortgage Loan, and to indemnify the Purchaser pursuant to Subsection 12.01, constitutes the sole remedies of the
Purchaser respecting a breach of the foregoing representations and warranties. If the Seller fails to repurchase or substitute
for a defective Mortgage Loan in accordance with this Subsection 7.03, or fails to cure a defective Mortgage Loan to the Purchaser’s
reasonable satisfaction in accordance with this Subsection 7.03, or to indemnify the Purchaser pursuant to Subsection 12.01, that
failure shall be an Event of Default and the Purchaser shall be entitled to pursue all available remedies. No provision of this
paragraph shall affect the rights of the Purchaser to terminate this Agreement for cause, as set forth in Subsections 13.01 and
14.01.

 

(e)          Any
cause of action against the Seller relating to or arising out of the breach of any representations and warranties made in Subsections
7.01 and 7.02 shall accrue as to any Mortgage Loan upon (i) notice thereof by the Purchaser to the Seller (ii) failure by the Seller
to cure such breach or repurchase such Mortgage Loan as specified above, and (iii) demand upon the Seller by the Purchaser for
compliance with this Agreement.

 

(f)           In
the event that any Mortgage Loan is held by a REMIC, notwithstanding any contrary provision of this Agreement, with respect to
any Mortgage Loan that is not in default or as to which no default is imminent, Purchaser may, in connection with any repurchase
or substitution of a defective Mortgage Loan pursuant to this Subsection 7.03, require that the Seller deliver, at the Seller’s
expense, an Opinion of Counsel to the effect that such repurchase or substitution will not (i) result in the imposition of taxes
on “prohibited transactions” of such REMIC (as defined in Section 860F of the Code) or otherwise subject the REMIC
to tax, or (ii) cause the REMIC to fail to qualify as a REMIC at any time.

 

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(g)          With
respect to any Mortgage Loan listed as having mortgage insurance on the Mortgage Loan Schedule, regardless of whether the insurance
is borrower paid or lender paid, if the mortgage insurer rejects, denies, or rescinds a claim on the basis of any defect in connection
with the origination of the Mortgage Loan or the servicing of the Mortgage Loan prior to the Closing Date (a “mortgage insurer
rejection”), other than as a result of the mortgage insurer’s breach of its obligations or as a result of the mortgage
insurer's insolvency, the Seller shall either repurchase such Mortgage Loan at the Repurchase Price or pay the Purchaser the amount
of such claim within thirty (30) days from the date of such mortgage insurer rejection.

 

(h)          The
parties agree that the resolution of any controversy or claim arising out of or relating to an obligation or alleged obligation
of the Seller to repurchase a Mortgage Loan due to a breach of a representation or warranty contained in Section 7.01 hereof shall
be by Arbitration. 

 

If
any allegation of a breach of a representation or warranty made in Section 7.01 has not been resolved to the satisfaction of both
the Purchaser and the Seller, either party may commence Arbitration to resolve the dispute; provided that a party may commence
Arbitration with respect to one or more unresolved allegations only during the months of January, April, July and October, and
all matters with respect to which Arbitration has been commenced in any such month shall be heard in a single Arbitration in the
immediately following month or as soon as practicable thereafter. To commence Arbitration, the moving party shall deliver written
notice to the other party that it has elected to pursue Arbitration in accordance with this Section 7.03(h), provided that
if the Seller has not responded to the Purchaser's notification of a breach of a representation and warranty, the Purchaser shall
not commence Arbitration with respect to that breach before 60 days following such notification in order to provide the Seller
with an opportunity to respond to such notification. Within 10 Business Days after a party has provided
notice that it has elected to pursue Arbitration, each party may submit the names of one or more proposed Arbitrators to the other
party in writing. If the parties have not agreed on the selection of an Arbitrator within five Business Days after the first such
submission, then the party commencing Arbitration shall, within the next 5 business days, notify the American Arbitration Association
in New York, NY and request that it appoint a single Arbitrator with experience in arbitrating disputes arising in the financial
services industry.

 

It
is the intention of the parties that Arbitration shall be conducted in as efficient and cost-effective a manner as is reasonably
practicable, without the burden of discovery. Accordingly, the Arbitrator will resolve the dispute on the basis of a review of
the written correspondence between the parties (including any supporting materials attached to such correspondence)
conveyed by the parties to each other in connection with the dispute prior to the delivery of notice to commence Arbitration;
however, upon a showing of good cause, a party may request the Arbitrator to direct the production of such additional information,
evidence and/or documentation from the parties that the Arbitrator deems appropriate. If requested by the Arbitrator or any party,
any hearing with respect to an Arbitration shall be conducted by video conference or teleconference except upon the agreement of
both parties or the request of the Arbitrator.

 

The finding of the
Arbitrator shall be final and binding upon the parties. Judgment upon any arbitration award rendered may be entered and enforced
in any court of competent jurisdiction. The costs of the Arbitrator shall be shared equally between both parties. Each party, however,
shall bear its own attorneys fees and costs in connection with the Arbitration.

  

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Subsection
7.04 Repurchase of Mortgage Loans With Early Payment Default.

 

If a Monthly Payment
becomes Delinquent by one (1) or more scheduled Monthly Payments at any time on or prior to the first day of the third calendar
month following the date of origination of the Mortgage Loan (or such other earlier date set forth in the related PPTL), then the
Seller, at the Purchaser’s option, shall (a) promptly repurchase the related Mortgage Loan from the Purchaser in accordance
with the procedures set forth in Subsection 7.03 hereof, however, any such repurchase shall be made at the Purchase Price, or (b)
substitute a mortgage loan acceptable to the Purchaser in accordance with Subsection 7.03 hereof.

 

Subsection
7.05 Purchase Price Protection.

 

With respect to any
Mortgage Loan that prepays in full on or prior to the last day of the third full month following the related Closing Date (or such
other earlier date set forth in the related PPTL), the Seller shall reimburse the Purchaser an amount equal to the product of (a)
the amount by which Purchase Price Percentage paid by the Purchaser to the Seller for such Mortgage Loan exceeds 100% and (b) the
outstanding principal balance of the Mortgage Loan as of the Cut-off Date. Such payment shall be made within thirty (30) days of
such payoff.

 

SECTION
8. Closing.

 

Subsection
8.01 Closing Conditions.

 

The closing for the
purchase and sale of each Mortgage Loan Package shall take place on the respective Closing Date. The closing shall be either by
telephone, confirmed by letter or wire as the parties hereto shall agree, or conducted in person, at such place as the parties
hereto shall agree.

 

The closing for each
Mortgage Loan Package shall be subject to the satisfaction of each of the following conditions:

 

(a)          the
Seller shall have delivered to the Purchaser the related Mortgage Loan Schedule and an electronic data file containing information
on a loan-level basis;

 

(b)          all
of the representations and warranties of the Seller under this Agreement shall be true and correct as of the related Closing Date
(or, with respect to Subsection 7.01, such other date specified therein) in all material respects and no default shall have occurred
hereunder which, with notice or the passage of time or both, would constitute an Event of Default hereunder;

 

(c)          the
Purchaser shall have received from the custodian an initial certification with respect to its receipt of the Mortgage Loan Documents
for the related Mortgage Loans;

  

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(d)          the
Purchaser shall have received originals of the related PPTL executed by the Seller and a funding memorandum setting forth the Purchase
Price(s) for the Mortgage Loan Package; and

 

(e)          all
other terms and conditions of this Agreement and the related PPTL to be satisfied by the Seller shall have been complied with in
all material respects.

 

Upon satisfaction of
the foregoing conditions, the Purchaser shall pay to the Seller on such Closing Date the Purchase Price for the related Mortgage
Loan Package pursuant to Section 4 of this Agreement.

 

Subsection
8.02 Closing Documents.

 

(a)          On
or before the initial Closing Date, the Seller shall submit to the Purchaser fully executed originals of the following documents:

 

(i)          this
Agreement, in four counterparts;

 

(ii)         if
requested by the Purchaser, a letter confirming the account name and number of the Custodial Account in a form to be provided by
the Purchaser;

 

(iii)        if
requested by the Purchaser, a letter confirming the account name and number of the Escrow Account in a form to be provided by the
Purchaser; and

 

 

(b)          On
or before each Closing Date, the Seller shall submit to the Purchaser fully executed originals of the following documents:

 

(i)          the
related PPTL;

 

(ii)         the
related Mortgage Loan Schedule;

 

(iii)        the
Purchaser shall have received from its custodian an initial certification with respect to its receipt of the Mortgage Loan Documents
for the related Mortgage Loans;

 

(iv)        a
certificate or other evidence of merger or change of name, signed or stamped by the applicable regulatory authority, if any of
the Mortgage Loans were acquired by the Seller by merger or acquired or originated by the Seller while conducting business under
a name other than its present name, if applicable.

  

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SECTION
9. [Reserved.]

 

SECTION
10. Costs.

 

The Seller shall pay
any commissions due its salespeople and the legal fees and expenses of its attorneys. The Purchaser shall pay the cost of delivering
the Mortgage Files to the Purchaser or its designee, the cost of recording the Assignments of Mortgage and all other costs and
expenses incurred in connection with the sale of the Mortgage Loans by the Seller to the Purchaser, including without limitation
the Purchaser’s attorneys’ fees. The Seller shall pay the cost of delivering the Mortgage Loan Documents to the Purchaser
or its designee for each related Closing Date.

 

SECTION
11. Interim Servicing; Servicing Transfer.

 

Subsection
11.01 Temporary Servicing of Mortgage Loans.

 

This Section 11 shall
apply during the Interim Servicing Period, but only to the extent that funds collected and received pursuant to any Mortgage Loan
during the Interim Servicing Period are payable to the Purchaser. All funds collected and received pursuant to each Mortgage Loan
during the Interim Servicing Period that are payable to the Purchaser shall be applied in accordance with this Section 11 and the
Servicing Transfer Instructions. All payments received in respect of the Mortgage Loans after the Servicing Transfer Date shall
be applied in accordance with the Servicing Transfer Instructions. The Seller agrees to comply with the Customary Servicing Procedures
during the Interim Servicing Period.

 

(a)          The
Seller, as an independent contractor, shall service and administer the Mortgage Loans on behalf of the Purchaser from and after
the Closing Date through the Servicing Transfer Date in accordance with this Agreement, the Servicing Transfer Instructions, Customary
Servicing Procedures and the terms of the Mortgage Notes and Mortgages, and shall have full power and authority, acting alone or
through subservicers or agents, to do or cause to be done any and all things in connection with such servicing and administration
which the Seller may deem necessary or desirable and consistent with the terms of this Agreement. The Seller may perform its servicing
responsibilities through agents or independent contractors, but shall not thereby be released from any of its responsibilities
hereunder. Notwithstanding anything to the contrary, the Seller may delegate any of its duties under this Agreement to one or more
of its affiliates without regard to any of the requirements of this section; provided, however, that the Seller shall not
be released from any of its responsibilities hereunder by virtue of such delegation. The Mortgage Loans may be subserviced by one
or more unaffiliated subservicers on behalf of the Seller provided each subservicer is a Fannie Mae approved seller/servicer or
a Freddie Mac approved seller/servicer in good standing, and no event has occurred, including but not limited to a change in insurance
coverage, that would make it unable to comply with the eligibility for seller/servicers imposed by Fannie Mae or Freddie Mac, or
which would require notification to Fannie Mae or Freddie Mac. The Seller shall pay all fees and expenses of the subservicer from
its own funds (provided that any such expenditures that would constitute Servicing Advances if made by the Seller hereunder shall
be reimbursable to the Seller as Servicing Advances), and the subservicer’s fee shall not exceed the Servicing Fee.

  

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(b)          It
is further understood and agreed that the interim servicing obligations of the Seller hereunder shall be limited to such servicing
and collection activities as are necessary for preserving the Purchaser’s interest in the Mortgage Loans on a temporary basis,
and that the servicing of the Mortgage Loans is intended by Seller and Purchaser to be transferred to the Purchaser or its designee
on or before the Servicing Transfer Date. In no event shall the Seller service, or bear any obligation for the servicing of, any
Mortgage Loan into any Securitization Transaction, Whole Loan Transfer, or in connection with the reconstitution of any Mortgage
Loan.

 

(c)          At
the cost and expense of the Seller, without any right of reimbursement from the Custodial Account, the Seller shall be entitled
to terminate the rights and responsibilities of a subservicer and arrange for any servicing responsibilities to be performed by
a successor subservicer meeting the requirements in the preceding paragraph; provided, however, that nothing contained
herein shall be deemed to prevent or prohibit the Seller, at the Seller’s option, from electing to service the related Mortgage
Loans itself. If the Seller’s responsibilities and duties under this Agreement are terminated and if requested to do so by
the Purchaser, the Seller shall at its own cost and expense terminate the rights and responsibilities of the subservicer as soon
as is reasonably possible. The Seller shall pay all fees, expenses or penalties necessary in order to terminate the rights and
responsibilities of the subservicer from the Seller’s own funds without reimbursement from the Purchaser.

 

(d)          The
Seller shall be entitled to enter into an agreement with the subservicer for indemnification of the Seller by the subservicer and
nothing contained in this Agreement shall be deemed to limit or modify such indemnification.

 

(e)          Any
subservicing agreement and any other transactions or services relating to the Mortgage Loans involving the subservicer shall be
deemed to be between the subservicer and Seller alone, and the Purchaser shall have no obligations, duties or liabilities with
respect to the subservicer including no obligation, duty or liability of the Purchaser to pay the subservicer’s fees and
expenses. For purposes of distributions and advances by the Seller pursuant to this Agreement, the Seller shall be deemed to have
received a payment on a Mortgage Loan when the subservicer has received such payment. The Seller shall not make any amendment to
any agreement with a subservicer if such amendment is not consistent with or violates the provisions of this Agreement, or if such
amendment could be reasonably expected to be materially adverse to the interests of the Purchaser.

 

(f)          The
Seller shall not waive, modify or vary any term of any Mortgage Loan or consent to the postponement
of strict compliance with any such term or in any manner grant indulgence to any Mortgagor without the prior written approval of
the Purchaser.

 

(g)          Whether
in connection with the foreclosure of a Mortgage Loan approved by the Purchaser or otherwise, the Seller
shall from its own funds make all necessary and proper Servicing Advances; provided, however, that the Seller
is not required to make a Servicing Advance unless the Seller determines in the exercise of its
good faith judgment that such Servicing Advance would ultimately be recoverable from REO Disposition Proceeds, Insurance Proceeds
or Condemnation Proceeds of the related Mortgaged Property (with respect to each of which the Seller
shall have the priority described in Subsection 11.05 for purposes of withdrawals from the Custodial Account). Any Servicing Advance
that would cause the amount of unreimbursed Servicing Advances for a particular Mortgage Loan to exceed $500 shall be made only
after notification of the Purchaser.

  

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(h)          Notwithstanding
anything to the contrary contained herein, in connection with a foreclosure or acceptance of a deed in lieu of foreclosure, in
the event the Seller has reasonable cause to believe that a Mortgaged Property is contaminated
by hazardous or toxic substances or wastes, or if the Purchaser otherwise requests an environmental inspection or review of such
Mortgaged Property, such an inspection or review is to be conducted by a qualified inspector at the Purchaser’s expense.
Upon completion of the inspection, the Seller shall promptly provide the Purchaser with a written
report of the environmental inspection. In the event (i) the environmental inspection report indicates that the Mortgaged Property
is contaminated by hazardous or toxic substances or wastes and (ii) the Purchaser directs the Seller
to proceed with foreclosure or acceptance of a deed in lieu of foreclosure, the Seller shall
be reimbursed for all reasonable costs associated with such foreclosure or acceptance of a deed in lieu of foreclosure and any
related environmental clean up costs, as applicable, from the related Liquidation Proceeds, or if the Liquidation Proceeds are
insufficient fully to reimburse the Seller, the Seller shall
be entitled to be reimbursed from amounts in the Custodial Account pursuant to Subsection 11.05 hereof. In the event the Purchaser
directs the Seller not to proceed with foreclosure or acceptance of a deed in lieu of foreclosure,
the Seller shall be reimbursed for all Servicing Advances made with respect to the related Mortgaged
Property from the Custodial Account pursuant to Subsection 11.05 hereof. Servicing Advances for which the Seller has not been reimbursed
as of the Servicing Transfer Date shall be reimbursed in accordance with the Servicing Transfer Instructions.

 

Subsection
11.02 Directions by Purchaser During Interim Servicing Period.

 

During the Interim
Servicing Period, in the event that any payment due under any Mortgage Loan is not paid when the same becomes due and payable,
or in the event the Mortgagor fails to perform any other covenant or obligation under the Mortgage Loan and such failure continues
beyond any applicable grace period, the Seller shall so notify the Purchaser and shall take such action as it is directed by the
Purchaser.

 

Subsection
11.03 Collection of Mortgage Loan Payments.

 

Continuously from the
date hereof until the earlier of (i) the date on which principal and interest on all Mortgage Loans are paid in full and (ii) the
Servicing Transfer Date, the Seller will proceed diligently, in accordance with this Agreement, to collect all payments due under
each of the Mortgage Loans when the same shall become due and payable. Further, the Seller will in accordance with Customary Servicing
Procedures ascertain and estimate taxes, assessments, fire and hazard insurance premiums, premiums for Primary Mortgage Insurance
Policies, and all other charges that, as provided in any Mortgage, will become due and payable to the end that the installments
payable by the Mortgagors will be sufficient to pay such charges as and when they become due and payable.

  

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Mortgage Loan payments
received by the Seller will be deposited within one Business Day of receipt into a clearing account that is an Eligible Account.
The Mortgage Loan payments may be commingled with payments of other mortgagors and investors for up to two Business Days prior
to the Seller depositing the Mortgage Loan payments in the Custodial Account. Such clearing account shall not be used for operational
or corporate purposes of the Seller.

 

Subsection
11.04 Establishment of Custodial Account; Deposits in Custodial Account.

 

The provisions that
follow in this Section 11.04 shall be applicable only if the actual Servicing Transfer Date occurs more than two calendar months
after the related Closing Date. If the following provisions are not applicable, the “Custodial Account” as used elsewhere
in this Agreement shall mean the deposit or other account that the Seller maintains for purposes of collecting mortgage loan payments
on behalf of third parties.

 

The Seller shall segregate
and hold all funds collected and received pursuant to each Mortgage Loan separate and apart from any of its own funds and general
assets and shall establish and maintain one or more Custodial Accounts (collectively, the “Custodial Account”),
titled “Seller, in trust for Redwood Residential Acquisition Corporation as Purchaser of Mortgage Loans and various Mortgagors.”
Such Custodial Account shall be an Eligible Account established with a commercial bank, a savings bank or a savings and loan association
(which may be a depository affiliate of the Seller) which meets the guidelines set forth by Fannie Mae or Freddie Mac as an eligible
depository institution for custodial accounts. The Custodial Account shall initially be established and maintained at an institution
reasonably acceptable to the Seller and the Purchaser, and shall not be transferred to any other depository institution without
the Purchaser’s approval, which shall not unreasonably be withheld. In any case, the Custodial Account shall be insured by
the FDIC in a manner which shall provide maximum available insurance thereunder and which may be drawn on by the Seller.

 

The Seller shall deposit
in the Custodial Account on a daily basis, and retain therein the following payments and collections received or made by it subsequent
to the related Cut-off Date (other than in respect of principal and interest on the Mortgage Loans due on or before the related
Cut-off Date):

 

(a)          all
payments on account of principal, including Principal Prepayments, on the Mortgage Loans;

 

(b)          all
payments on account of interest on the Mortgage Loans adjusted to the related Mortgage Loan Remittance Rate;

 

(c)          all
Liquidation Proceeds;

 

(d)          all
proceeds received by the Seller under any title insurance policy, hazard insurance policy, Primary Mortgage Insurance Policy or
other insurance policy other than proceeds to be held in the Escrow Account and applied to the restoration or repair of the Mortgaged
Property or released to the Mortgagor in accordance with Customary Servicing Procedures;

  

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(e)          all
awards or settlements in respect of condemnation proceedings or eminent domain affecting any Mortgaged Property which are not released
to the Mortgagor in accordance with Customary Servicing Procedures;

 

(f)          any
amount required to be deposited in the Custodial Account pursuant to Subsections 11.15 and 11.19;

 

(g)          any
amount required to be deposited by the Seller in connection with any REO Property pursuant to Subsection 11.13;

 

(h)          all
amounts required to be deposited by the Seller in connection with shortfalls in principal amount of Substitute Mortgage Loans pursuant
to Subsection 7.03; and

 

(i)          with
respect to each Full Prepayment and each Partial Prepayment, an amount (to be paid by the Seller out of its own funds) equal to
the Prepayment Interest Shortfall; provided, however, that the Seller’s aggregate obligations under this paragraph
for any month shall be limited to the total amount of Servicing Fees actually received with respect to the Mortgage Loans by the
Seller during such month.

 

The foregoing requirements
for deposit in the Custodial Account shall be exclusive, it being understood and agreed that, without limiting the generality of
the foregoing, payments in the nature of late payment charges, assumption fees and other ancillary fees need not be deposited by
the Seller in the Custodial Account.

 

The funds in the Custodial
Account shall remain uninvested.

 

Subsection
11.05 Withdrawals From the Custodial Account.

 

The Seller shall, from
time to time during the Interim Servicing Period, withdraw funds from the Custodial Account for the following purposes:

 

(a)          to
make payments to the Purchaser in the amounts and in the manner provided for in Subsection 11.15;

 

(b)          [reserved];

 

(c)          to
reimburse itself for any unpaid Servicing Fees and for unreimbursed Servicing Advances, the Seller’s right to reimburse itself
pursuant to this subclause (c) with respect to any Mortgage Loan being limited to related Liquidation Proceeds, Condemnation
Proceeds, Insurance Proceeds and such other amounts as may be collected by the Seller from the related Mortgagor or otherwise relating
to the Mortgage Loan, it being understood that, in the case of any such reimbursement, the Seller’s right thereto shall be
prior to the rights of the Purchaser unless the Seller is required to repurchase a Mortgage Loan pursuant to Subsection 7.03,
or the Seller is required to pay the Prepayment Interest Shortfall pursuant to Subsection 11.15, in which case the Seller’s
right to such reimbursement shall be subsequent to the payment to the Purchaser of the related Repurchase Price pursuant to Subsection 7.03,
and all other amounts required to be paid to the Purchaser with respect to such Mortgage Loan;

  

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(d)          to
reimburse itself for unreimbursed Servicing Advances, to the extent that such amounts are nonrecoverable (as certified by the Seller
to the Purchaser in an Officer’s Certificate) by the Seller pursuant to subclause (c) above, provided that the Mortgage Loan
for which such advances were made is not required to be repurchased by the Seller pursuant to Subsection 7.03;

 

(e)          to
reimburse itself for expenses incurred by and reimbursable to it pursuant to Subsection 12.01;

 

(f)          [reserved];

 

(g)          to
pay to itself any interest earned on funds deposited in the Custodial Account;

 

(h)          to
withdraw any amounts inadvertently deposited in the Custodial Account; and

 

(i)           to
clear and terminate the Custodial Account upon the termination of this Agreement.

 

Upon request, the Seller
will provide the Purchaser with copies of reasonably acceptable invoices or other documentation relating to Servicing Advances
that have been reimbursed from the Custodial Account.

 

Subsection
11.06 Establishment of Escrow Account; Deposits in Escrow Account.

 

The provisions that
follow in this Section 11.06 shall be applicable only if the actual Servicing Transfer Date occurs more than two calendar months
after the related Closing Date. If the following provisions are not applicable, the “Escrow Account” as used elsewhere
in this Agreement shall mean the deposit or other account that the Seller maintains for purposes of collecting escrow payments
for mortgage loans serviced on behalf of third parties.

 

The Seller shall segregate
and hold all funds collected and received pursuant to each Mortgage Loan which constitute Escrow Payments separate and apart from
any of its own funds and general assets and shall establish and maintain one or more Escrow Accounts (collectively, the “Escrow
Account”), titled “Seller, in trust for Redwood Residential Acquisition Corporation as Purchaser of Mortgage Loans
and various Mortgagors.” The Escrow Account shall be an Eligible Account established with a commercial bank, a savings bank
or a savings and loan association (which may be a depository affiliate of Seller), which meets the guidelines set forth by Fannie
Mae or Freddie Mac as an eligible institution for escrow accounts. The Escrow Account shall initially be established and maintained
at an institution reasonably acceptable to the Seller and the Purchaser, and shall not be transferred to any other depository institution
without the Purchaser’s approval, which shall not unreasonably be withheld. In any case, the Escrow Account shall be insured
by the FDIC in a manner which shall provide maximum available insurance thereunder and which may be drawn on by the Seller.

  

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The Seller shall deposit
in the Escrow Account on a daily basis, and retain therein: (a) all Escrow Payments collected on account of the Mortgage Loans,
for the purpose of effecting timely payment of any such items as required under the terms of this Agreement and (b) all amounts
representing proceeds of any hazard insurance policy which are to be applied to the restoration or repair of any Mortgaged Property.
The Seller shall make withdrawals therefrom only in accordance with Subsection 11.07 hereof. As part of its interim servicing
duties, the Seller shall pay to the Mortgagors interest on funds in the Escrow Account, to the extent required by law.

 

Subsection
11.07 Withdrawals From Escrow Account.

 

Withdrawals from the
Escrow Account shall be made by the Seller only (a) to effect timely payments of ground rents, taxes, assessments, premiums
for Primary Mortgage Insurance Policies, fire and hazard insurance premiums or other items constituting Escrow Payments for the
related Mortgage, (b) to reimburse the Seller for any Servicing Advance made by Seller pursuant to Subsection 11.08 hereof
with respect to a related Mortgage Loan, (c) to refund to any Mortgagor any funds found to be in excess of the amounts required
under the terms of the related Mortgage Loan, (d) for transfer to the Custodial Account upon default of a Mortgagor or in
accordance with the terms of the related Mortgage Loan and if permitted by applicable law, (e) for application to restore
or repair of the Mortgaged Property, (f) to pay to the Mortgagor, to the extent required by law, any interest paid on the
funds deposited in the Escrow Account, (g) to pay to itself any interest earned on funds deposited in the Escrow Account (and
not required to be paid to the Mortgagor), (h) to the extent permitted under the terms of the related Mortgage Note and applicable
law, to pay late fees with respect to any Monthly Payment which is received after the applicable grace period, (i) to withdraw
suspense payments that are deposited into the Escrow Account, (j) to withdraw any amounts inadvertently deposited in the Escrow
Account or (k) to clear and terminate the Escrow Account upon the termination of this Agreement.

 

Subsection
11.08 Payment of Taxes, Insurance and Other Charges; Collections Thereunder.

 

With respect to each
Mortgage Loan, the Seller shall maintain accurate records reflecting the status of ground rents, taxes, assessments and other charges
which are or may become a lien upon the Mortgaged Property and the status of premiums for Primary Mortgage Insurance Policies and
fire and hazard insurance coverage and shall obtain, from time to time, all bills for the payment of such charges (including renewal
premiums) and shall effect payment thereof prior to the applicable penalty or termination date and at a time appropriate for securing
maximum discounts allowable, employing for such purpose deposits of the Mortgagor in the Escrow Account which shall have been estimated
and accumulated by the Seller in amounts sufficient for such purposes, as allowed under the terms of the Mortgage. To the extent
that a Mortgage does not provide for Escrow Payments, the Seller shall determine that any such payments are made by the Mortgagor.
The Seller assumes full responsibility for the timely payment of all such bills and shall effect timely payments of all such bills
irrespective of each Mortgagor’s faithful performance in the payment of same or the making of the Escrow Payments and shall
make Servicing Advances to effect such payments, subject to its ability to recover such Servicing Advances pursuant to Subsections 11.05(c),
11.05(d) and 11.07(b). No costs incurred by the Seller or subservicers in effecting the payment of ground rents, taxes, assessments
and other charges on the Mortgaged Properties or mortgage or hazard insurance premiums shall, for the purpose of calculating remittances
to the Purchaser, be added to the amount owing under the related Mortgage Loans, notwithstanding that the terms of such Mortgage
Loans so permit.

  

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Subsection
11.09 Transfer of Accounts.

 

The Seller may, with
Purchaser's approval which shall not be unreasonably withheld, transfer the Custodial Account or the Escrow Account to an Eligible
Account at a different depository institution.

 

Subsection
11.10 Maintenance of Hazard Insurance.

 

The Seller shall cause
to be maintained for each Mortgage Loan fire and hazard insurance with extended coverage customary in the area where the Mortgaged
Property is located by an insurer acceptable to Fannie Mae or Freddie Mac and FHA or VA, as applicable, in an amount which is at
least equal to the lesser of (a) the full insurable value of the Mortgaged Property or (b) the greater of (i) the
outstanding principal balance owing on the Mortgage Loan and (ii) an amount such that the proceeds of such insurance shall
be sufficient to avoid the application to the Mortgagor or loss payee of any coinsurance clause under the policy. If the Mortgaged
Property is in an area identified in the Federal Register by the Federal Emergency Management Agency as a special flood hazard
area (and such flood insurance has been made available) the Seller will cause to be maintained a flood insurance policy meeting
the requirements of the National Flood Insurance Program, in an amount representing coverage not less than the lesser of (A) the
minimum amount required under the terms of the coverage to compensate for any damage or loss to the Mortgaged Property on a replacement-cost
basis (or the outstanding principal balance of the Mortgage Loan if replacement-cost basis is not available) or (B) the maximum
amount of insurance available under the National Flood Insurance Program. The Seller shall also maintain on REO Property fire and
hazard insurance with extended coverage in an amount which is at least equal to the maximum insurable value of the improvements
which are a part of such property, liability insurance and, to the extent required and available under the National Flood Insurance
Program, flood insurance in an amount required above. Any amounts collected by the Seller under any such policies (other than amounts
to be deposited in the Escrow Account and applied to the restoration or repair of the property subject to the related Mortgage
or property acquired in liquidation of the Mortgage Loan, or to be released to the Mortgagor in accordance with Customary Servicing
Procedures) shall be deposited in the Custodial Account, subject to withdrawal pursuant to Subsection 11.05. It is understood
and agreed that no earthquake or other additional insurance need be required by the Seller of any Mortgagor or maintained on REO
Property other than pursuant to such applicable laws and regulations as shall at any time be in force and as shall require such
additional insurance. All policies required hereunder shall be endorsed with standard mortgagee clauses with loss payable to the
Seller, and shall provide for at least thirty (30) days prior written notice of any cancellation, reduction in amount or material
change in coverage to the Seller. The Seller shall not interfere with the Mortgagor’s freedom of choice in selecting either
its insurance carrier or agent; provided, however, that unless otherwise required by the terms of the related Mortgage Note
or applicable law, the Seller shall not accept any such insurance policies from insurance companies unless such companies are acceptable
to Fannie Mae or Freddie Mac and FHA or VA, as applicable, and are licensed to do business in the state wherein the property subject
to the policy is located.

 

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The hazard insurance
policies for each Mortgage Loan secured by a unit in a condominium development or planned unit development shall be maintained
with respect to such Mortgage Loan and the related development in a manner which is consistent with Fannie Mae or Freddie Mac requirements
and FHA or VA requirements, as applicable, unless otherwise required by the terms of the related Mortgage Note or applicable law.

 

Subsection
11.11 Maintenance of Primary Mortgage Insurance Policy; Claims.

 

With respect to each
Mortgage Loan with a LTV in excess of 80%, the Seller shall promptly, without any cost to the Purchaser, maintain or cause the
Mortgagor to maintain in full force and effect a Primary Mortgage Insurance Policy issued by a Qualified Insurer insuring the portion
over 78% (or such other percentage in conformance with then current Fannie Mae requirements) until terminated pursuant to the Homeowners
Protection Act of 1988, 12 USC § 4901, et seq. or any other applicable federal, state or local law or regulation. In the event
that such Primary Mortgage Insurance Policy shall be terminated other than as required by law, the Seller shall obtain from another
Qualified Insurer a comparable replacement policy, with a total coverage equal to the remaining coverage of such terminated Primary
Mortgage Insurance Policy. If the insurer shall cease to be a Qualified Insurer, the Seller shall obtain from another Qualified
Insurer a replacement Primary Mortgage Insurance Policy. The Seller shall not take any action which would result in noncoverage
under any applicable Primary Mortgage Insurance Policy of any loss which, but for the actions of the Seller would have been covered
thereunder. In connection with any assumption or substitution agreement entered into or to be entered into pursuant to Subsection 11.18,
the Seller shall promptly notify the insurer under the related Primary Mortgage Insurance Policy, if any, of such assumption or
substitution of liability in accordance with the terms of such Primary Mortgage Insurance Policy and shall take all actions which
may be required by such insurer as a condition to the continuation of coverage under such Primary Mortgage Insurance Policy. If
such Primary Mortgage Insurance Policy is terminated as a result of such assumption or substitution of liability, the Seller shall
obtain a replacement Primary Mortgage Insurance Policy as provided above.

 

In connection with
its activities as interim servicer, the Seller agrees to prepare and present or to assist the Purchaser in preparing and presenting,
on behalf of itself and the Purchaser, claims to the insurer under any Primary Mortgage Insurance Policy in a timely fashion in
accordance with the terms of such Primary Mortgage Insurance Policy and, in this regard, to take such action as shall be necessary
to permit recovery under any Primary Mortgage Insurance Policy respecting a defaulted Mortgage Loan. Pursuant to Subsection 11.04,
any amounts collected by the Seller under any Primary Mortgage Insurance Policy shall be deposited in the Custodial Account, subject
to withdrawal pursuant to Subsection 11.05.

 

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Subsection
11.12 Fidelity Bond; Errors and Omissions Insurance.

 

The Seller shall maintain,
at its own expense, a blanket Fidelity Bond and an errors and omissions insurance policy, with broad coverage on all officers,
employees or other persons acting in any capacity requiring such persons to handle funds, money, documents or papers relating to
the Mortgage Loans. These policies must insure the Seller against losses resulting from fraud, theft, errors, omissions, negligence,
dishonest or fraudulent acts committed by the Seller’s personnel, any employees of outside firms that provide data processing
services for the Seller, and temporary contract employees or student interns. The Fidelity Bond shall also protect and insure the
Seller against losses in connection with the release or satisfaction of a Mortgage Loan without having obtained payment in full
of the indebtedness secured thereby. No provision of this Subsection 11.12 requiring such Fidelity Bond and errors and omissions
insurance shall diminish or relieve the Seller from its duties and obligations as set forth in this Agreement. The minimum coverage
under any such Fidelity Bond and insurance policy shall be at least equal to the corresponding amounts required by FHA or VA, Fannie
Mae in the Fannie Mae Guides or by Freddie Mac in the Freddie Mac Guide, as amended or restated from time to time, as applicable,
or in an amount as may be permitted to the Seller by express waiver of FHA or VA and Fannie Mae or Freddie Mac, as applicable.
Upon request of the Purchaser, the Seller shall cause to be delivered to the Purchaser a certified true copy of such Fidelity Bond
or a certificate evidencing the same with a statement that the Seller shall endeavor to provide written notice to the Purchaser
thirty (30) days prior to modification or any material change.

 

Subsection
11.13 Title, Management and Disposition of REO Property.

 

Subject to Subsection
11.02, in the event that title to a Mortgaged Property is acquired in foreclosure or by deed in lieu of foreclosure, the deed or
certificate of sale shall be taken in the name of the Purchaser or its nominee.

 

The Seller shall cause
to be deposited on a daily basis in the Custodial Account all revenues received with respect to the conservation of the related
REO Property. The Seller shall make distributions as required on each Remittance Date to the Purchaser of the net cash flow from
the REO Property (which shall equal the revenues from such REO Property net of the expenses described below and of any reserves
reasonably required from time to time to be maintained to satisfy anticipated liabilities for such expenses).

 

The disposition of
REO Property shall be carried out by the Seller, subject to Subsection 11.01. The Purchaser shall pay the Seller a fee of 1.5%
of the sales price for such REO Property for services associated with managing the REO Property through its disposition. Upon the
request of the Purchaser, and at the Purchaser’s expense, the Seller shall cause an appraisal of the REO Property to be performed
for the Purchaser.

 

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The Seller shall either
itself or through an agent selected by the Seller, manage, conserve, protect and operate the REO Property in the same manner that
it manages, conserves, protects and operates other foreclosed property for its own account, and in the same manner that similar
property in the same locality as the REO Property is managed. Any disbursement in excess of $15,000 shall be made only with the
prior written approval of the Purchaser. The Seller shall deduct the costs of managing, conserving, protecting and operating the
REO Property from the proceeds of the sale of the REO Property (providing documentary evidence of such costs).

 

The Seller shall not
accept any sale offer for an REO Property that is more than 10% below the Reconciled Market Value of the REO Property without the
prior written consent of the Purchaser.

 

Subsection
11.14 Servicing Compensation.

 

As compensation for
its interim servicing activities hereunder and subject to Subsection 11.15, the Seller shall be entitled to retain the Servicing
Fee from interest payments actually collected on the Mortgage Loans. Additional servicing compensation in the form of assumption
fees, late payment charges, fees related to the disposition of REO Property and other ancillary income shall be retained by the
Seller to the extent not required to be deposited in the Custodial Account. The Seller shall be required to pay all expenses incurred
by it in connection with its interim servicing activities hereunder and shall not be entitled to reimbursement therefor except
as specifically provided for herein. The Servicing Fee shall not be reduced by the amount of any guarantee fee payable to FHA or
VA.

 

Subsection
11.15 Distributions.

 

On each Remittance
Date the Seller shall remit by wire transfer of immediately available funds to the account designated in writing by the Purchaser
of record on the preceding Record Date all amounts credited to the Custodial Account as of such date, net of charges against or
withdrawals from the Custodial Account pursuant to Subsection 11.05(c) through (h).

 

Not later than each
Remittance Date, the Seller shall from its own funds deposit in the Custodial Account an amount equal to the aggregate Prepayment
Interest Shortfall due to either Partial Prepayment or Full Prepayment, if any, existing in respect of the related Principal Prepayment
Period.

 

With respect to any
remittance received by the Purchaser after the Business Day on which such payment was due, the Seller shall pay to the Purchaser
interest on any such late payment at an annual rate equal to the rate of interest as is publicly announced from time to time in
The Wall Street Journal, or its successor, as the prime rate, adjusted as of the date of each change, plus two percent (2%),
but in no event greater than the maximum amount permitted by applicable law. Such interest shall be paid by the Seller to the Purchaser
on the date such late payment is made and shall cover the period commencing with the Business Day on which such payment was due
and ending with the Business Day immediately preceding the Business Day on which such payment is made, both inclusive. The payment
by the Seller of any such interest shall not be deemed an extension of time for payment or a waiver of any Event of Default by
the Seller.

 

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Subsection
11.16 Statements to the Purchaser.

 

Not later than five
(5) days prior to each related Remittance Date, the Seller shall forward to the Purchaser a statement in the form specified and
with the information required by the monthly reporting format of the Master Servicer, as provided to the Seller by the Purchaser.
Such statement shall also include information regarding delinquencies on Mortgage Loans, indicating the number and aggregate principal
amount of Mortgage Loans which are either one (1), two (2) or three (3) or more months Delinquent. The Seller shall
submit to the Purchaser monthly a liquidation report with respect to each Mortgaged Property sold in a foreclosure sale as of the
related Record Date and not previously reported. The Seller shall also provide such information as set forth above to the Purchaser
in electronic form in the Seller’s standard format, a copy of which has been provided by the Seller.

 

In addition, the Seller
shall submit to the Purchaser monthly loan-by-loan default information including, without limitation, notes made and retained by
the Seller in connection with servicing the defaulted loan, the reasons for the default, updated values of the Mortgaged Property,
updated Credit Scores on the Mortgagor and information regarding Servicing Advances made.

 

The Seller shall prepare
and file any and all tax returns, information statements or other filings required to be delivered to any governmental taxing authority,
the Mortgagor or to the Purchaser pursuant to any applicable law with respect to the Mortgage Loans and the transactions contemplated
hereby. In addition, the Seller shall provide the Purchaser with such information concerning the Mortgage Loans as is necessary
for such Purchaser to prepare federal income tax returns as the Purchaser may reasonably request from time to time.

 

Subsection
11.17 [Reserved].

 

Subsection
11.18 Assumption Agreements.

 

The Seller will use
its best efforts to enforce any “due-on-sale” provision contained in any Mortgage or Mortgage Note; provided
that, subject to the Purchaser’s prior approval, the Seller shall permit such assumption if so required in accordance with
the terms of the Mortgage or the Mortgage Note. When the Mortgaged Property has been conveyed by the Mortgagor prior to payment
in full of the Mortgage Loan, the Seller will, to the extent it has knowledge of such conveyance, exercise its rights to accelerate
the maturity of such Mortgage Loan under the “due-on-sale” clause applicable thereto; provided, however, the
Seller will not exercise such rights if prohibited by law from doing so or if the exercise of such rights would impair or threaten
to impair any recovery under the related Primary Mortgage Insurance Policy, if any. In connection with any such assumption, the
outstanding principal amount, the Monthly Payment, the Mortgage Interest Rate, the Lifetime Rate Cap (if applicable), the Gross
Margin (if applicable), the Initial Rate Cap (if applicable) or the Periodic Rate Cap (if applicable) of the related Mortgage Note
shall not be changed, and the term of the Mortgage Loan will not be increased or decreased. If an assumption is allowed pursuant
to this Subsection 11.18, the Seller with the prior consent of the issuer of the Primary Mortgage Insurance Policy, if any,
is authorized to enter into a substitution of liability agreement with the purchaser of the Mortgaged Property pursuant to which
the original Mortgagor is released from liability and the purchaser of the Mortgaged Property is substituted as Mortgagor and becomes
liable under the Mortgage Note.

 

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Subsection
11.19 Satisfaction of Mortgages and Release of Mortgage Files.

 

Upon the payment in
full of any Mortgage Loan, or the receipt by the Seller of a notification that payment in full will be escrowed in a manner customary
for such purposes, the Seller will obtain the portion of the Mortgage File that is in the possession of the Purchaser or its designee,
prepare and process any required satisfaction or release of the Mortgage and notify the Purchaser in accordance with the provisions
of this Agreement. The Purchaser agrees to deliver to the Seller (or cause to be delivered to the Seller) the original Mortgage
Note for any Mortgage Loan not later than five (5) Business Days following its receipt of a notice from the Seller that such
a payment in full has been received or that a notification has been received that such a payment in full shall be made. Such Mortgage
Note shall be held by the Seller, in trust, for the purpose of canceling such Mortgage Note and delivering the canceled Mortgage
Note to the Mortgagor in a timely manner as and to the extent provided under any applicable federal or state law.

 

In the event the Seller
grants a satisfaction or release of a Mortgage without having obtained payment in full of the indebtedness secured by the Mortgage,
the Seller shall remit to the Purchaser the Stated Principal Balance of the related Mortgage Loan by deposit thereof in the Custodial
Account. The Fidelity Bond shall insure the Seller against any loss it may sustain with respect to any Mortgage Loan not satisfied
in accordance with the procedures set forth herein.

 

Subsection
11.20 Seller Shall Provide Access and Information as Reasonably Required.

 

The Seller shall provide
to the Purchaser, and for any Purchaser insured by the FDIC or NAIC, the supervisory agents and examiners of the FDIC and OCC or
NAIC, access to any documentation regarding the Mortgage Loans which may be required by applicable regulations. Such access shall
be afforded without charge, but only upon reasonable request, during normal business hours and at the offices of the Seller.

 

In addition, the Seller
shall furnish upon request by the Purchaser, during the term of this Agreement, such periodic, special or other reports or information,
whether or not provided for herein, as shall be necessary, reasonable and appropriate with respect to the purposes of this Agreement
and applicable regulations. All such reports or information shall be provided by and in accordance with all reasonable instructions
and directions the Purchaser may require. The Seller agrees to execute and deliver all such instruments and take all such action
as the Purchaser, from time to time, may reasonably request in order to effectuate the purposes and to carry out the terms of this
Agreement.

 

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Subsection
11.21 Inspections.

 

The Seller shall inspect
the Mortgaged Property as often as deemed necessary by the Seller to assure itself that the value of the Mortgaged Property is
being preserved. In addition, if any Mortgage Loan is more than forty-five (45) days delinquent, the Seller shall inspect the Mortgaged
Property and shall conduct subsequent inspections in accordance with Customary Servicing Procedures or as may be required by the
primary mortgage guaranty insurer. The Seller shall keep a written report of each such inspection and shall provide a copy of such
inspection to the Purchaser upon the request of the Purchaser.

 

Subsection
11.22 Restoration of Mortgaged Property.

 

The Seller need not
obtain the approval of the Purchaser prior to releasing any Insurance Proceeds or Condemnation
Proceeds to the Mortgagor to be applied to the restoration or repair of the Mortgaged Property if such release is in accordance
with Customary Servicing Procedures. For claims greater than $15,000, at a minimum, the Seller shall, to the extent permitted by
the terms of the related Mortgage Note and applicable law, comply with the following conditions in connection with any such release
of Insurance Proceeds or Condemnation Proceeds:

 

(a)          the
Seller shall receive satisfactory independent verification of completion of repairs and issuance
of any required approvals with respect thereto;

 

(b)          the
Seller shall take all steps necessary to preserve the priority of the lien of the Mortgage,
including, but not limited to requiring waivers with respect to mechanics’ and materialmen’s liens;

 

(c)          the
Seller shall verify that the Mortgage Loan is not in default; and

 

(d)          pending
repairs or restoration, the Seller shall place the Insurance Proceeds or Condemnation Proceeds
in the Escrow Account.

 

If the Purchaser is
named as an additional loss payee, the Seller is hereby empowered to endorse any loss draft issued
in respect of such a claim in the name of the Purchaser.

 

Subsection
11.23 Fair Credit Reporting Act.

 

The Seller, in its
capacity as interim servicer for each Mortgage Loan, agrees to fully furnish, in accordance with the Fair Credit Reporting Act
and its implementing regulations, accurate and complete information (e.g., favorable and unfavorable) on its borrower credit files
to Equifax, Experian and Trans Union Credit Information Company (three of the credit repositories), on a monthly basis.

 

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Subsection
11.24 Transfer of Servicing to Purchaser.

 

The Seller shall cause
all Servicing Rights and obligations with respect to the Mortgage Loans to be transferred to the Purchaser (or such person as the
Purchaser may designate) on the Servicing Transfer Date. The Seller hereby agrees to comply with the Servicing Transfer Instructions
attached hereto as Exhibit 4.

 

Subsection
11.25 Payments Received.

 

The Seller shall apply
all payments received in respect of the Mortgage Loans during the Interim Servicing Period and after the Transfer Date in accordance
with the Servicing Transfer Instructions.

 

SECTION
12. The Seller.

 

Subsection
12.01 Indemnification; Third Party Claims.

 

(a)          The
Seller agrees to indemnify and hold harmless the Purchaser against any and all claims, losses, penalties, fines, forfeitures, legal
fees and related costs, judgments, and any other costs, fees and expenses that the Purchaser may sustain in any way related to
or resulting from (i) any claim, demand, defense or assertion based on or grounded upon or resulting from, or alleging a breach
of a representation or warranty set forth in Sections 7.01 or 7.02 of this Agreement, and without regard to any knowledge qualifier
included in any such representation or warranty, (ii) a breach by the Seller of any of its duties or obligations under this Agreement
or (iii) any material misstatements or omissions contained in any information provided by the Seller pursuant to Section 32
or any failure by the Seller to comply with Section 32. This indemnification obligation shall survive the termination of this
Agreement or the termination of any party to this Agreement.

 

(b)          The
Seller shall immediately notify the Purchaser if a claim is made by a third party with respect to this Agreement or the Mortgage
Loans, and the Seller shall assume (with the written consent of the Purchaser) the defense of any such claim and pay all expenses
in connection therewith, including counsel fees. If the Seller has assumed the defense of the Purchaser, the Seller shall provide
the Purchaser with a written report of all expenses and advances incurred by the Seller pursuant to this Subsection 12.01
and the Purchaser shall promptly reimburse the Seller for all amounts advanced by it pursuant to the preceding sentence except
when the claim in any way relates to or results from anything listed in clauses (i), (ii) or (iii) of Subsection 12.01(a) or any
other breach by the Seller of this Agreement.

 

Subsection
12.02 Merger or Consolidation of the Seller.

 

The Seller will keep
in full effect its existence, rights and franchises as a Virginia limited liability company, and will obtain and preserve its qualification
to do business 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 Mortgage Loans and to perform its duties under this Agreement.

 

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Any Person into which
the Seller may be merged or consolidated, or any entity resulting from any merger, conversion or consolidation to which the Seller
shall be a party, or any Person succeeding to substantially all of the business of the Seller shall be the successor of the Seller
hereunder, without the execution or filing of any paper or any further act on the part of any of the parties hereto, anything herein
to the contrary notwithstanding.

 

Subsection
12.03 Limitation on Liability of the Seller and Others.

 

The duties and obligations
of the Seller in its capacity as the interim servicer of the Mortgage Loans shall be determined solely by the express provisions
of this Agreement, the Seller as interim servicer shall not be liable except for the performance of such duties and obligations
as are specifically set forth in this Agreement and no implied covenants or obligations shall be read into this Agreement against
the Seller as interim servicer. Neither the Seller nor any of the directors, officers, employees or agents of the Seller shall
be under any liability to the Purchaser for any action taken or for refraining from the taking of any action in accordance with
Customary Servicing Procedures and otherwise in good faith pursuant to this Agreement or for errors in judgment; provided, however,
that this provision shall not protect the Seller as interim servicer against any liability resulting from any breach of any representation
or warranty made herein, or from any liability specifically imposed on the Seller as interim servicer herein; and, provided
further, that this provision shall not protect the Seller as interim servicer against any liability that would otherwise be
imposed by reason of the willful misfeasance, bad faith or gross negligence in the performance of duties or by reason of reckless
disregard of the obligations or duties hereunder. The Seller and any director, officer, employee or agent of the Seller may rely
on any document of any kind which it in good faith reasonably believes to be genuine and to have been adopted or signed by the
proper authorities respecting any matters arising hereunder. Subject to the terms of Subsection 12.01, the Seller shall have
no obligation to appear with respect to, prosecute or defend any legal action which is not incidental to the Seller’s duty
to service the Mortgage Loans in accordance with this Agreement.

 

SECTION
13.   Default.

 

Subsection
13.01 Events of Default.

 

In case one or more
of the following Events of Default by the Seller shall occur and be continuing:

 

(a)          any
failure by the Seller to remit to the Purchaser any payment required to be made under the terms of this Agreement which continues
unremedied for a period of two (2) Business Days;

 

(b)          failure
by the Seller to duly observe or perform, in any material respect, any other covenants, obligations or agreements of the Seller
as set forth in this Agreement which failure continues unremedied for a period of thirty (30) days after the date on which
written notice of such failure, requiring the same to be remedied, shall have been given to the Seller by the Purchaser;

 

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(c)          a
decree or order of a court or agency or supervisory authority having jurisdiction for the appointment of a conservator or receiver
or liquidator in any insolvency, bankruptcy, readjustment of debt, marshalling of assets and liabilities or similar proceedings,
or for the winding-up or liquidation of its affairs, shall have been entered against the Seller and such decree or order shall
have remained in force, undischarged or unstayed for a period of sixty (60) days;

 

(d)          the
Seller shall consent to the appointment of a conservator or receiver or liquidator in any insolvency, bankruptcy, readjustment
of debt, marshalling of assets and liabilities or similar proceedings of or relating to the Seller or relating to all or substantially
all of the Seller’s property;

 

(e)          the
Seller shall admit in writing its inability to pay its debts as they become due, file a petition to take advantage of any applicable
insolvency or reorganization statute, make an assignment for the benefit of its creditors, or voluntarily suspend payment of its
obligations;

 

(f)          the
Seller shall cease to be qualified to do business under the laws of any state in which a Mortgaged Property is located, but only
to the extent such qualification is necessary to ensure the enforceability of each Mortgage Loan and to perform the Seller’s
obligations under this Agreement;

 

(g)          the
Seller shall fail to meet the servicer eligibility qualifications of Fannie Mae or the Seller shall fail to meet the servicer eligibility
qualifications of Freddie Mac, as applicable; or

 

(h)          the
Seller shall fail to repurchase a Mortgage Loan within 30 days of the final decision of an Arbitrator that the Seller is obligated
to repurchase such Mortgage Loan;

 

then, and in
each and every such case, so long as an Event of Default shall not have been remedied, the Purchaser, by notice in writing to the
Seller, may, in addition to whatever rights the Purchaser may have at law or equity to damages,
including injunctive relief and specific performance, commence termination of all the rights and obligations of the Seller
under this Agreement and with respect to the Mortgage Loans and the proceeds thereof. Upon receipt by
the Seller of such written notice from the Purchaser stating that it intends to terminate the
Seller as a result of such Event of Default, all authority and power of the Seller under
this Agreement, including any compensation due the Seller under this Agreement on and after the
effective date of termination, whether with respect to the Mortgage Loans or otherwise, shall pass to and be vested in the successor
appointed pursuant to Subsection 14.02. Upon written request from the Purchaser, the Seller shall
prepare, execute and deliver to a successor any and all documents and other instruments, place in such successor’s possession
all Mortgage Files and do or cause to be done all other acts or things necessary or appropriate to effect the purposes of such
notice of termination, including, but not limited to, the transfer and endorsement or assignment of the Mortgage Loans and related
documents to the successor at the Seller’s sole expense. The Seller agrees
to cooperate with the Purchaser and such successor in effecting the termination of the Seller’s
responsibilities and rights hereunder, including, without limitation, the transfer to such successor for administration by it of
all amounts which shall at the time be credited by the Seller to the Custodial Account or Escrow
Account or thereafter received with respect to the Mortgage Loans and, if prior to the Servicing Transfer Date, the payment of
all costs relating to the transfer of servicing. 

 

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Subsection
13.02 Waiver of Default. 

 

The Purchaser may waive
any default by the Seller in the performance of its obligations hereunder and its consequences. Upon any waiver of a past
default, such default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been remedied for
every purpose of this Agreement. No such waiver shall extend to any subsequent or other default or impair any right consequent
thereto except to the extent expressly so waived.

 

SECTION
14.  Termination.

 

Subsection
14.01 Termination.

 

If the Servicing Transfer
Date has not occurred, the obligations and responsibilities of the Seller, as interim servicer of the Mortgage Loans, shall terminate
upon (a) the distribution to the Purchaser of the final payment or liquidation with respect to the last Mortgage Loan (or
advances of same by the Seller) or (b) the disposition of all property acquired upon foreclosure or deed in lieu of foreclosure
with respect to the last Mortgage Loan and the remittance of all funds due hereunder. Upon written request from the Purchaser in
connection with any such termination, the Seller shall prepare, execute and deliver any and all documents and other instruments,
place in the Purchaser’s possession all Mortgage Files, and do or accomplish all other acts or things necessary or appropriate
to effect the purposes of such notice of termination, whether to complete the transfer and endorsement or assignment of the Mortgage
Loans and related documents, or otherwise, at the Purchaser’s sole expense. The Seller agrees to cooperate with the Purchaser
and such successor in effecting the termination of the Seller’s responsibilities and rights hereunder as interim servicer,
including, without limitation, the transfer to such successor for administration by it of all cash amounts which shall at the time
be credited by the Seller to the Custodial Account or Escrow Account or thereafter received with respect to the Mortgage Loans.

 

Subsection
14.02 Successors to the Seller as Interim Servicer.

 

Prior to the termination
of the Seller’s responsibilities and duties under this Agreement pursuant to Subsections 13.01, 14.01 or 14.03, the
Purchaser shall (a) succeed to and assume all of the Seller’s responsibilities, rights, duties and obligations under
this Agreement or (b) appoint a successor which shall succeed to all rights and assume all of the responsibilities, duties
and liabilities of the Seller under this Agreement upon such termination. In connection with such appointment and assumption, the
Purchaser may make such arrangements for the compensation of such successor out of payments on Mortgage Loans as it and such successor
shall agree. In the event that the Seller’s duties, responsibilities and liabilities under this Agreement shall be terminated
pursuant to the aforementioned Subsections, the Seller shall discharge such duties and responsibilities during the period from
the date it acquires knowledge of such termination until the effective date thereof with the same degree of diligence and prudence
which it is obligated to exercise under this Agreement, and shall take no action whatsoever that might impair or prejudice the
rights or financial condition of its successor. The resignation or removal of the Seller pursuant to the aforementioned Subsections
shall not become effective until a successor shall be appointed pursuant to this Subsection and shall in no event relieve the Seller
of the representations and warranties made pursuant to Subsections 7.01 and 7.02 and the remedies available to the Purchaser
under Subsection 7.03, it being understood and agreed that the provisions of such Subsections 7.01 and 7.02 shall be
applicable to the Seller notwithstanding any such resignation or termination of the Seller, or the termination of this Agreement.

 

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Any successor appointed
as provided herein shall execute, acknowledge and deliver to the Seller and to the Purchaser an instrument accepting such appointment,
whereupon such successor shall become fully vested with all the rights, powers, duties, responsibilities, obligations and liabilities
of the Seller as interim servicer, with like effect as if originally named as a party to this Agreement. Any termination or resignation
of the Seller or this Agreement pursuant to Subsections 13.01, 14.01 or 14.03 shall not affect any claims that the Purchaser
may have against the Seller based upon facts and circumstances arising prior to any such termination or resignation.

 

The Seller shall promptly
deliver to the successor the funds in the Custodial Account and Escrow Account and all Mortgage Files and related documents and
statements held by it hereunder and the Seller shall account for all funds and shall execute and deliver such instruments and do
such other things as may reasonably be required to more fully and definitively vest in the successor all such rights, powers, duties,
responsibilities, obligations and liabilities of the Seller as servicer of the Mortgage Loans.

 

Upon a successor’s
acceptance of appointment as such, the Seller shall notify by mail the Purchaser of such appointment.

 

Subsection
14.03 Termination of Interim Servicing by Purchaser. 

 

The
Seller shall not be entitled to any compensation related to any termination of its servicing
rights and obligations under this Agreement. The Purchaser may terminate this Agreement without cause and transfer interim servicing
to a successor interim servicer at any time. Upon written request from the Purchaser in connection with any such termination,
the Seller shall prepare, execute and deliver, any and all documents and other instruments, and do or accomplish all other acts
or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement
or assignment of the Mortgage Loans and related documents, or otherwise, and including the delivery to or at the direction of the
Purchaser, all contents of the Mortgage Files in the possession of the Seller, at the Purchaser’s sole expense. The Seller
agrees to cooperate with the Purchaser and such successor in effecting the termination of the Seller’s responsibilities and
rights hereunder as interim servicer, including, without limitation, the transfer to such successor for administration by it of
all cash amounts which shall at the time be credited by the Seller to the Custodial Account or Escrow Account or thereafter received
with respect to the Mortgage Loans.

 

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SECTION
15. Notices.

 

All demands, notices
and communications hereunder shall be in writing and shall be deemed to have been duly given if mailed, by registered or certified
mail, return receipt requested, or, if by other means, when received by the other party at the address as follows:

 

		(a)	if to the Purchaser:

 

Redwood Residential Acquisition
Corporation

One Belvedere Place, Suite 360

Mill Valley, CA 94941

Attention:  Loss Mitigation

Phone:  (415) 380-3445

Facsimile:  (415) 381-1773

 

with a copy to the General Counsel
at the same address

 

		(b)	if to the Seller:

 

George Mason Mortgage, LLC

4100 Monument Corner Drive, Suite 100

Fairfax, VA 22030

Attention: Sue Spinetta

 

or such other address as may hereafter
be furnished to the other party by like notice. Any such demand, notice or communication hereunder shall be deemed to have been
received on the date delivered to or received at the premises of the addressee (as evidenced, in the case of registered or certified
mail, by the date noted on the return receipt).

 

SECTION
16.  Severability Clause.

 

Any part, provision,
representation or warranty of this Agreement which is prohibited or which is held to be void or unenforceable shall be ineffective
to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof. Any part, provision,
representation or warranty of this Agreement which is prohibited or unenforceable or is held to be void or unenforceable in any
jurisdiction shall be ineffective, as to such jurisdiction, to the extent of such prohibition or unenforceability without invalidating
the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction as to any Mortgage Loan shall
not invalidate or render unenforceable such provision in any other jurisdiction. To the extent permitted by applicable law, the
parties hereto waive any provision of law which prohibits or renders void or unenforceable any provision hereof. If the invalidity
of any part, provision, representation or warranty of this Agreement shall deprive any party of the economic benefit intended to
be conferred by this Agreement, the parties shall negotiate, in good-faith, to develop a structure the economic effect of which
is nearly as possible the same as the economic effect of this Agreement without regard to such invalidity.

 

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SECTION
17.  No Partnership.

 

Nothing herein contained
shall be deemed or construed to create a co-partnership or joint venture between the parties hereto and the services of the Seller
shall be rendered as an independent contractor and not as agent for the Purchaser.

 

SECTION
18.  Counterparts.

 

This Agreement may
be executed simultaneously in any number of counterparts. Each counterpart shall be deemed to be an original, and all such counterparts
shall constitute one and the same instrument.

 

SECTION
19.  Governing Law; Choice of Forum; Waiver of Jury Trial.

 

EXCEPT TO THE EXTENT
PREEMPTED BY FEDERAL LAW, THE AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND THE OBLIGATIONS,
RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REGARD TO THE CONFLICTS OF LAWS PROVISIONS OF NEW YORK (OTHER THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW) OR ANY OTHER
JURISDICTION.

 

EACH PARTY HERETO
KNOWINGLY, INTENTIONALLY AND IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY SUIT, ACTION OR PROCEEDING ARISING OUT
OF IN ANY WAY RELATED TO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY.

 

Except as to those
matters which this Agreement provides shall be submitted to Arbitration, with respect to any claim or action arising hereunder,
the parties (a) irrevocably submit to the nonexclusive jurisdiction of the courts of the State of New York and the United States
District Court located in the Borough of Manhattan in The City of New York, New York, and appellate courts from any thereof, and
(b) irrevocably waive any objection which such party may have at any time to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement brought in any such court, and irrevocably waive any claim that any such suit action
or proceeding brought in any such court has been brought in an inconvenient forum.

 

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SECTION
20.  Intention of the Parties.

 

It is the intention
of the parties that the Purchaser is purchasing, and the Seller is selling, the Mortgage Loans and not a debt instrument of the
Seller or another security. Accordingly, the parties hereto each intend to treat the transaction for federal income tax purposes
as a sale by the Seller, and a purchase by the Purchaser, of the Mortgage Loans. The Purchaser shall have the right to review the
Mortgage Loans and the related Mortgage Files to determine the characteristics of the Mortgage Loans which shall affect the federal
income tax consequences of owning the Mortgage Loans and the Seller shall cooperate with all reasonable requests made by the Purchaser
in the course of such review.

 

It is not the intention
of the parties that such conveyances be deemed a grant of a security interest in the Mortgage Loans transferred hereunder. However,
in the event that, notwithstanding the intent of the parties, such assets are held to be the property of the Seller or if for any
other reason this Agreement is held or deemed to create a security interest in either such assets, then (a) this Agreement
shall be a security agreement within the meaning of the Uniform Commercial Code of the State of New York and (b) the conveyances
provided for in this Agreement shall be deemed to be a grant by the Seller to the Purchaser of, and the Seller hereby grants to
the Purchaser a security interest in all of the assets transferred hereunder, whether now owned or hereafter acquired.

 

SECTION
21.  Waivers.

 

No term or provision
of this Agreement may be waived or modified unless such waiver or modification is in writing and signed by the party against whom
such waiver or modification is sought to be enforced.

 

SECTION
22.  Exhibits.

 

The exhibits to this
Agreement are hereby incorporated and made a part hereof and are an integral part of this Agreement.

 

SECTION
23.  General Interpretive Principles.

 

For purposes of this
Agreement, except as otherwise expressly provided or unless the context otherwise requires:

 

(a)          the
terms defined in this Agreement have the meanings assigned to them in this Agreement and include the plural as well as the singular,
and the use of any gender herein shall be deemed to include the other gender;

 

(b)          accounting
terms not otherwise defined herein have the meanings assigned to them in accordance with generally accepted accounting principles;

 

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(c)          references
herein to “Articles,” “Sections,” “Subsections,” “Paragraphs” and other subdivisions
without reference to a document are to designated Articles, Sections, Subsections, Paragraphs and other subdivisions of this Agreement;

 

(d)          the
headings of the various articles, sections, subsections and paragraphs of this Agreement and the table of contents are for convenience
of reference only and shall not modify, define, expand or limit any of the terms or provisions hereof;

 

(e)          reference
to a Subsection without further reference to a Section is a reference to such Subsection as contained in the same Section in which
the reference appears, and this rule shall also apply to Paragraphs and other subdivisions;

 

(f)          the
words “herein,” “hereof,” “hereunder” and other words of similar import refer to this Agreement
as a whole and not to any particular provision; and

 

(g)          the
term “include” or “including” shall mean without limitation by reason of enumeration.

 

SECTION
24.  Reproduction of Documents.

 

This Agreement and
all documents relating thereto, including, without limitation (a) consents, waivers and modifications which may hereafter
be executed, (b) documents received by any party at the closing and (c) financial statements, certificates and other
information previously or hereafter furnished, may be reproduced by any photographic, photostatic, microfilm, micro-card, miniature
photographic or other similar process. The parties hereto agree that any such reproduction shall be admissible in evidence as the
original itself in any judicial or administrative proceeding, whether or not the original is in existence and whether or not such
reproduction was made by a party hereto in the regular course of business, and that any enlargement, facsimile or further reproduction
of such reproduction shall likewise be admissible in evidence.

 

SECTION
25.  Amendment.

 

This Agreement may
be amended from time to time by the Purchaser and the Seller by written agreement signed by the parties hereto.

 

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SECTION
26.  Confidentiality.

 

The
Purchaser and the Seller shall employ proper procedures and standards designed to maintain the confidential nature of the terms
of this Agreement, except to the extent (a) the disclosure of which is reasonably believed by such party to be required in
connection with regulatory requirements or other legal requirements relating to its affairs; (b) disclosed to any one or more
of such party’s employees, officers, directors, agents, attorneys or accountants who would have access to the contents of
this Agreement and such data and information in the normal course of the performance of such person’s duties for such party,
to the extent such party has procedures in effect to inform such person of the confidential nature thereof; (c) that is disclosed
in a prospectus, prospectus supplement or private placement memorandum relating to a Securitization Transaction of
the Mortgage Loans by the Purchaser (or an affiliate assignee thereof) or to any person in connection with the resale or proposed
resale of all or a portion of the Mortgage Loans by such party in accordance with the terms of this Agreement; and (d) that
is reasonably believed by such party to be necessary for the enforcement of such party’s rights under this Agreement.

 

SECTION
27.  Entire Agreement.

 

This Agreement constitutes
the entire agreement and understanding relating to the subject matter hereof between the parties hereto and any prior oral or written
agreements between them shall be deemed to have merged herewith.

 

SECTION
28.  Further Agreements.

 

The Seller and the
Purchaser each agree to execute and deliver to the other such reasonable and appropriate additional documents, instruments or agreements
as may be necessary or appropriate to effectuate the purposes of this Agreement.

 

SECTION
29.  Successors and Assigns.

 

This Agreement shall
bind and inure to the benefit of and be enforceable by the initial Purchaser and the Seller, and the respective successors and
assigns of the Purchaser and the Seller. The initial Purchaser and any subsequent purchasers may assign this Agreement to any Person
to whom any Mortgage Loan is transferred pursuant to a sale or financing without the consent of the Seller. Upon any such assignment,
the Person to whom such assignment is made shall succeed to all rights and obligations of the Purchaser under this Agreement to
the extent of the related Mortgage Loan or Mortgage Loans and this Agreement, to the extent of the related Mortgage Loan or Mortgage
Loans, shall be deemed to be a separate and distinct agreement between the Seller and such purchaser, and a separate and distinct
agreement between the Seller and each other purchaser to the extent of the other related Mortgage Loan or Mortgage Loans. The Seller
shall not assign this Agreement or resign from the obligations and duties hereby imposed on it except by mutual consent of the
Seller and the Purchaser.

 

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SECTION
30.  Non-Solicitation.

 

From and after the
Closing Date, the Seller and any of its affiliates hereby agrees that it will not take any action or permit or cause any action
to be taken by any of its agents or affiliates, or by any independent contractors on its behalf, to personally, by telephone or
mail, solicit a Mortgagor under any Mortgage Loan for the purpose of refinancing a Mortgage Loan, in whole or in part, without
the prior written consent of the Purchaser. It is understood and agreed that all rights and benefits relating to the solicitation
of any Mortgagors and the attendant rights, title and interest in and to the list of such Mortgagors and data relating to their
Mortgages (including insurance renewal dates) shall be transferred to the Purchaser pursuant hereto on the Closing Date and neither
the Seller nor any of its respective affiliates shall take any action to undermine these rights and benefits.

 

Notwithstanding the
foregoing, it is understood and agreed that the Seller or any of its respective affiliates may advertise its availability for handling
refinancings of mortgages in its portfolio, including the promotion of terms it has available for such refinancings, through the
sending of letters or promotional material, so long as it does not specifically target Mortgagors and so long as such promotional
material either is sent to the mortgagors for all of the mortgages in the A-quality servicing portfolio of the Seller and any of
its affiliates (those it owns as well as those serviced for others) or sent to all of the mortgagors who have specific types of
mortgages (such as FHA, VA, conventional fixed-rate or conventional adjustable-rate), or sent to those mortgagors whose mortgages
fall within specific interest rate ranges.

 

Promotions undertaken
by the Seller or by any affiliate of the Seller which are directed to the general public at large (including, without limitation,
mass mailing based on commercially acquired mailing lists, newspaper, radio and television advertisements), shall not constitute
solicitation under this Section 30.

 

SECTION
31. Protection of Consumer Information.

 

Each party agrees that
it (i) shall comply with any applicable laws and regulations regarding the privacy and security of Consumer Information, (ii) shall
not use Consumer Information in any manner inconsistent with any applicable laws and regulations regarding the privacy and security
of Consumer Information, (iii) shall not disclose Consumer Information to third parties except at the specific written direction
of the Seller, (iv) shall maintain adequate physical, technical and administrative safeguards to protect Consumer Information from
unauthorized access and (v) shall immediately notify the Seller of any actual or suspected breach of the confidentiality of Consumer
Information.

 

SECTION
32. Cooperation of the Seller with a Reconstitution; Regulation AB Compliance.

 

(a)          The
Seller acknowledges and the Purchaser agrees that with respect to some or all of the Mortgage Loans, the Purchaser may effect either:

 

(1)          one
or more Whole Loan Transfers; and

 

(2)          one
or more Securitization Transactions.

 

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(b)          The
Seller shall cooperate with the Purchaser and any prospective purchaser in connection with any Whole Loan Transfer contemplated
by the Purchaser pursuant to this Section. In connection therewith, the Purchaser shall deliver any Reconstitution Agreement or
other document related to the Whole Loan Transfer to the Seller at least fifteen (15) days prior to such transfer and the Seller
shall execute any Reconstitution Agreement that restates the representations and warranties contained in Subsection 7.01 as of
the related Closing Date and Subsection 7.02 herein as of the Reconstitution Date. Any prospective assignees of the Purchaser who
have entered into a commitment to purchase any of the Mortgage Loans in a Whole Loan Transfer may review the Seller’s servicing
and origination operations, upon reasonable prior notice to the Seller, and the Seller shall cooperate with such review and underwriting
to the extent such prospective assignees request information or documents that are available and can be produced without unreasonable
expense or effort. Subject to any applicable laws, the Seller shall make the Mortgage Files related to the Mortgage Loans held
by the Seller during the Interim Servicing Period available at the Seller’s principal operations center for review by any
such prospective assignees during normal business hours upon reasonable prior notice to the Seller (in no event fewer than five
(5) Business Days’ prior notice). The Seller may, in its sole discretion, require that such prospective assignees sign a
confidentiality agreement with respect to such information disclosed to the prospective assignee which is not available to the
public at large and a release agreement with respect to its activities on the Seller’s premises. The Purchaser hereby agrees
to reimburse the Seller for reasonable “out-of-pocket” expenses incurred by the Seller that relate to such Whole Loan
Transfer, including without limitation reimbursement for the amount which reasonably reflects time and effort expended by the Seller
in connection therewith.

 

(c)          In
order to facilitate compliance with Regulation AB promulgated under the Securities Act, the Seller and the Purchaser agree to comply
with the provisions of the Regulation AB Compliance Addendum attached hereto as Addendum I.

 

(d)          The
Seller shall cooperate with the Purchaser in connection with any Securitization Transaction contemplated by the Purchaser pursuant
to this Section. In connection therewith, the Purchaser shall deliver any Reconstitution Agreement or other document related to
the Securitization Transaction to the Seller at least fifteen (15) days prior to the closing of such Securitization Transaction
and the Seller shall execute any Reconstitution Agreement that restates the representations and warranties contained in Subsection
7.01 as of the related Closing Date and Subsection 7.02 herein as of the Reconstitution Date. The Reconstitution Agreement shall
include such other terms as may be reasonably necessary to effect the Securitization Transaction. In connection with any Securitization
Transaction, the Seller shall not, and shall cause its affiliates not to, as part of the original offering thereof, purchase any
of the securities offered in such Securitization Transaction.

 

(e)          In
connection with each Securitization Transaction, the Seller shall deliver to the Purchaser and to any Person designated by the
Purchaser, (i) such statements and audit letters of certified public accountants pertaining to information provided by the Seller
as are customarily delivered by originators such as the Seller in connection with securitization transactions and (ii) opinions
of counsel as are customarily delivered by originators and reasonably determined by the Purchaser to be necessary in connection
any Securitization Transaction.

 

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(f)          Prior
to the Servicing Transfer Date, all Mortgage Loans not sold or transferred pursuant to a Whole Loan Transfer or Securitization
Transaction shall be subject to this Agreement and shall continue to be serviced in accordance with the terms of this Agreement
and with respect thereto this Agreement shall remain in full force and effect. It is understood and agreed by the Purchaser and
the Seller that the right to effectuate such Whole Loan Transfer or Securitization Transaction as contemplated by this Section 32
is limited to the Purchaser.

 

[SIGNATURES ON FOLLOWING
PAGE]

 

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IN WITNESS WHEREOF,
the parties have caused their names to be signed hereto by their respective officers thereunto duly authorized on the date first
above written.

 

	 	REDWOOD RESIDENTIAL ACQUISITION CORPORATION,
	 	 
	 	as Purchaser
	 	 
	 	By:	/s/ John Isbrandtsen
	 	Name: John Isbrandtsen
	 	Title: Authorized Officer
	 	 
	 	GEORGE MASON MORTGAGE, LLC,
	 	 
	 	as Seller
	 	 
	 	By:	/s/ Robert C. Brown, Jr.
	 	Name: Robert C. Brown, Jr.
	 	Title: President and CEO

 

[Flow Mortgage Loan Purchase and Sale Agreement,
dated August 1, 2012]

 

    	 

    	 

    

 

EXHIBIT 1

 

MORTGAGE LOAN DOCUMENTS

 

With respect to each Mortgage Loan, the
Mortgage Loan Documents shall consist of the following:

 

(a)          the
original Mortgage Note bearing all intervening endorsements, endorsed in blank and signed in the name of the Seller by an officer
thereof;

 

(b)          the
original Assignment of Mortgage with assignee’s name left blank;

 

(c)          the
original of any guarantee executed in connection with the Mortgage Note;

 

(d)          the
original Mortgage with evidence of recording thereon, or if any such mortgage has not been returned from the applicable recording
office or has been lost, or if such public recording office retains the original recorded mortgage, a photocopy of such mortgage
certified by the Seller to be a true and complete copy of the original recorded mortgage;

 

(e)          the
originals of all assumption, modification, consolidation or extension agreements, if any, with evidence of recording thereon;

 

(f)          the
originals of all intervening assignments of mortgage with evidence of recording thereon, or if any such intervening assignment
of mortgage has not been returned from the applicable recording office or has been lost or if such public recording office retains
the original recorded assignments of mortgage, a photocopy of such intervening assignment of mortgage, certified by the Seller
to be a true and complete copy of the original recorded intervening assignment of mortgage;

 

(g)          the
original mortgagee title insurance policy including an Environmental Protection Agency Endorsement and, with respect to any Adjustable
Rate Mortgage Loan, an adjustable-rate endorsement;

 

(h)          the
original of any security agreement, chattel mortgage or equivalent document executed in connection with the Mortgage; and

 

(i)          a
copy of any applicable power of attorney.

 

With respect to each Mortgage Loan that is secured by a first
lien on and a perfected security interest in Co-op Shares and the related Proprietary Lease (as such terms are defined below) granting
exclusive rights to occupy the related co-op unit in the building owned by the related co-op corporation, in lieu of delivering
the documents listed above the Seller shall deliver the following documents to the Purchaser or its designee:

 

    	1-1

    	 

    

 

		(i)	the original Mortgage Note together with any applicable riders, endorsed in blank, with all prior and intervening endorsements
as may be necessary to show a complete chain of endorsements;

 

		(ii)	the original security agreement;

 

		(iii)	the original lease on a co-op unit evidencing the possessory interest of the owner of the Co-op Shares in such co-op unit (the
“Proprietary Lease”) and an original assignment of the Proprietary Lease in blank;

 

		(iv)	the original recognition agreement;

 

		(v)	the original stock certificate representing the shares of stock issued by a co-op corporation and allocated to a co-op unit
(the “Co-op Shares”) and original stock power in blank;

 

		(vi)	the original UCC-1 financing statement with evidence of filing; and

 

		(vii)	the original UCC-3 assignment in blank.

 

    	1-2

    	 

    

 

EXHIBIT 2

 

CONTENTS OF EACH MORTGAGE FILE

 

With respect to each
Mortgage Loan, the Mortgage File shall include each of the following items, unless otherwise disclosed to the Purchaser on the
data tape, which shall be delivered to the Purchaser, with a copy retained by the Seller as necessary:

 

(a)          The
Mortgage Loan Documents as listed in Exhibit 1.

 

(b)          Residential
loan application.

 

(c)          Mortgage
Loan closing statement.

 

(d)          Verification
of employment and income, including the executed 4506T if required.

 

(e)          Verification
of acceptable evidence of source and amount of down payment.

 

(f)           Credit
report on Mortgagor, in a form acceptable to either Fannie Mae or Freddie Mac.

 

(g)          Residential
appraisal report.

 

(h)          Photograph
of the Mortgaged Property.

 

(i)           Survey
of the Mortgaged Property, unless a survey is not required by the title insurer.

 

(j)           Copy
of each instrument necessary to complete identification of any exception set forth in the exception schedule in the title policy,
i.e., map or plat, restrictions, easements, home owner association declarations, etc.

 

(k)          Copies
of all required disclosure statements.

 

(l)           If
applicable, termite report, structural engineer’s report, water potability and septic certification.

 

(m)         Sales
contract, if applicable.

 

(n)          The
Primary Mortgage Insurance policy or certificate of insurance or electronic notation of the existence of such policy, where required
pursuant to the Agreement.

 

(o)          Evidence
of electronic notation of the hazard insurance policy, and, if required by law, evidence of the flood insurance policy.

 

(p)          Any
documentation provided by the Mortgagor or obtained by the Seller in connection with the granting of any underwriting exception.

 

(q)          All
other documentation involved in the underwriting or origination of the related Mortgage Loan.

 

    	2-1

    	 

    

 

EXHIBIT 3

 

FORM OF Purchase Price and Terms Letter

 

CLOSING DATE: _______________

 

This Purchase Price
and Terms Letter (this “PPTL”), dated as of _______ (the “Closing Date”), provides for the sale by George
Mason Mortgage, LLC (the “Seller”) to Redwood Residential Acquisition Corporation (the “Purchaser”), and
the purchase by the Purchaser from the Seller, of the first lien residential mortgage loans described on the Mortgage Loan Schedule
attached as Schedule I hereto (the “Mortgage Loans”), on a servicing released basis, pursuant to the terms of the Flow
Mortgage Loan Purchase and Sale Agreement (the “Flow Purchase and Sale Agreement”), dated as of August 1, 2012, by
and between the Purchaser and the Seller. Capitalized terms that are used herein but are not defined herein shall have the respective
meanings set forth in the Flow Purchase and Sale Agreement.

 

For good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the Seller does hereby, sell, convey, assign and transfer
to Purchaser without recourse, except as provided in the Flow Purchase and Sale Agreement, and on a servicing released basis, all
right, title and interest of the Seller in and to each of the Mortgage Loans, including all payments of principal and interest
received on the Mortgage Loans after the Cut-off Date, all other unscheduled collections collected in respect of the Mortgage Loans
after the Cut-off Date, all proceeds of the foregoing and all documents maintained as part of the related Mortgage Files, subject,
however, to the rights of the Seller under the Flow Purchase and Sale Agreement.

 

The Seller has delivered
to the Purchaser or its designee prior to the date hereof the documents with respect to each Mortgage Loan required to be delivered
under the Flow Purchase and Sale Agreement.

 

For purposes of the
Mortgage Loans sold pursuant to this PPTL, certain terms shall be as set forth below:

 

	Servicer:	________________________
	Stated Principal Balance:	$_______________________
	Closing Date:	  _______________________
	Servicing Transfer Date:	  _______________________
	Cut-off Date:	  _______________________
	Purchase Price Percentage:	  ________%
	 	 

 

    	3-1

    	 

    

 

In WITNESS WHEREOF,
the parties hereto, by the hands of their duly authorized officers, execute this PPTL as of the Closing Date referred to above.

 

	REDWOOD RESIDENTIAL

ACQUISITION CORPORATION	 	GEORGE MASON MORTGAGE, LLC

as Seller
	as Purchaser	 	
	 	 	 	 	 
	By:  	 	 	By:  	 
	 	 	 	 	 
	Name:  	 	 	Name:  	 
	 	 	 	 	 
	Its:  	 	 	Its:  	 

 

    	3-2

    	 

    

 

EXHIBIT 4

 

SERVICING TRANSFER INSTRUCTIONS

 

    	4-1

    	 

    

 

EXHIBIT 5

 

FORM OF ASSIGNMENT OF REPRESENTATIONS

AND WARRANTIES AGREEMENT

 

This is an Assignment
of Representations and Warranties Agreement (the “Agreement”) made as of the [     ] day of [month], [year], among Redwood
Residential Acquisition Corporation, a Delaware corporation (“Assignor”), Sequoia Residential Funding, Inc., a Delaware
corporation (“Depositor”), [TRUSTEE NAME], a national banking association, not in its individual capacity but solely
as trustee (in such capacity, the “Trustee” or the “Assignee”) under a Pooling and Servicing Agreement
dated as of [date] (the “Pooling and Servicing Agreement”), and [SELLER NAME], a [           ] (“Seller”).

 

In consideration of
the mutual promises contained herein, the parties hereto agree that the mortgage loans (the “Mortgage Loans”) listed
on Attachment 1 annexed hereto (the “Mortgage Loan Schedule”) are subject to the terms of the Flow Mortgage Loan Purchase
and Sale Agreement dated as of [date], between Assignor and Seller (the “Purchase Agreement”) as modified or supplemented
by this Agreement. Unless otherwise specified herein, capitalized terms used herein but not defined shall have the meanings ascribed
to them in the Purchase Agreement. Assignor will sell the Mortgage Loans to Depositor pursuant to a Mortgage Loan Purchase and
Sale Agreement dated the date hereof, and Depositor will sell the Mortgage Loans to Assignee pursuant to the Pooling and Servicing
Agreement.

 

Assignment 

 

1.            Assignor
hereby grants, transfers and assigns to Depositor all of its right, title and interest in, to and under the representations and
warranties made by Seller pursuant to the Purchase Agreement to the extent relating to the Mortgage Loans, and Depositor hereby
accepts such assignment from Assignor.

 

2.            Depositor
hereby grants, transfers and assigns to Assignee all of its right, title and interest in, to and under the representations and
warranties made by Seller pursuant to the Purchase Agreement to the extent relating to the Mortgage Loans, Depositor is released
from all obligations under the Purchase Agreement, and Assignee hereby accepts such assignment from Depositor.

 

3.            Seller
hereby acknowledges the foregoing assignments.

 

Representations and Warranties

 

4.            Assignor
warrants and represents to, and covenants with, Depositor, Assignee and Seller as of the date hereof that:

 

(a)          Attached
hereto as Attachment 2 is a true and accurate copy of the Purchase Agreement, which agreement is in full force and effect as of
the date hereof and the provisions of which have not been waived, amended or modified in any respect, nor has any notice of termination
been given thereunder;

 

    	5-1

    	 

    

 

(b)          Assignor
is the lawful owner of its interests and rights under the Purchase Agreement to the extent of the Mortgage Loans, free and clear
from any and all claims and encumbrances whatsoever, and upon the transfer of the representations and warranties to Assignee as
contemplated herein, Assignee shall have good title to such representations and warranties under the Purchase Agreement to the
extent of the Mortgage Loans, free and clear of all liens, claims and encumbrances;

 

(c)          There
are no offsets, counterclaims or other defenses available to Seller with respect to the Purchase Agreement;

 

(d)          Assignor
is duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation, and has all requisite
power and authority to enter into and perform its obligations under the Purchase Agreement;

 

(e)          Assignor
has full corporate power and authority to execute, deliver and perform its obligations under this Agreement, and to consummate
the transactions set forth herein. The consummation of the transactions contemplated by this Agreement is in the ordinary course
of Assignor’s business and will not conflict with, or result in a breach of, any of the terms, conditions or provisions of
Assignor’s charter or by-laws or any legal restriction, or any material agreement or instrument to which Assignor is now
a party or by which it is bound, or result in the violation of any law, rule, regulation, order, judgment or decree to which Assignor
or its property is subject. The execution, delivery and performance by Assignor of this Agreement and the consummation by it of
the transactions contemplated hereby, have been duly authorized by all necessary corporate action on the part of Assignor. This
Agreement has been duly executed and delivered by Assignor and, upon the due authorization, execution and delivery by Assignee,
will constitute the valid and legally binding obligation of Assignor enforceable against Assignor in accordance with its terms
except as enforceability may be limited by bankruptcy, reorganization, insolvency, moratorium or other similar laws now or hereafter
in effect relating to creditors’ rights generally, and by general principles of equity regardless of whether enforceability
is considered in a proceeding in equity or at law; and

 

(f)          No
consent, approval, order or authorization of, or declaration, filing or registration with, any governmental entity is required
to be obtained or made by Assignor in connection with the execution, delivery or performance by Assignor of this Agreement, or
the consummation by it of the transactions contemplated hereby.

 

5.            Depositor
warrants and represents to, and covenants with, Assignor, Assignee and Seller that as of the date hereof:

 

(a)          Depositor
is a Delaware corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation;

 

    	5-2

    	 

    

 

(b)          Depositor
has full corporate power and authority to execute, deliver and perform its obligations under this Agreement, and to consummate
the transactions set forth herein. The consummation of the transactions contemplated by this Agreement is in the ordinary course
of Depositor’s business and will not conflict with, or result in a breach of, any of the terms, conditions or provisions
of Depositor’s charter or by-laws or any legal restriction, or any material agreement or instrument to which Depositor is
now a party or by which it is bound, or result in the violation of any law, rule, regulation, order, judgment or decree to which
Depositor or its property is subject. The execution, delivery and performance by Depositor of this Agreement and the consummation
by it of the transactions contemplated hereby, have been duly authorized by all necessary corporate action on part of Depositor.
This Agreement has been duly executed and delivered by Depositor and, upon the due authorization, execution and delivery by the
other parties hereto, will constitute the valid and legally binding obligation of Depositor enforceable against Depositor in accordance
with its terms except as enforceability may be limited by bankruptcy, reorganization, insolvency, moratorium or other similar laws
now or hereafter in effect relating to creditors’ rights generally, and by general principles of equity regardless of whether
enforceability is considered in a proceeding in equity or at law; and

 

(c)          No
consent, approval, order or authorization of, or declaration, filing or registration with, any governmental entity is required
to be obtained or made by Depositor in connection with the execution, delivery or performance by Depositor of this Agreement, or
the consummation by it of the transactions contemplated hereby other than any that have been obtained or made.

 

6.            Assignee
warrants and represents to, and covenants with, Assignor, Depositor and Seller that as of the date hereof:

 

(a)          Assignee
is a national banking association duly organized, validly existing and in good standing under the laws of the jurisdiction of its
organization; and

 

(b)          Assignee
has been directed to enter into this Agreement pursuant to the provisions of the Pooling and Servicing Agreement. The execution,
delivery and performance by Assignee of this Agreement and the consummation by it of the transactions contemplated hereby, have
been duly authorized by all necessary action on part of Assignee. This Agreement has been duly executed and delivered by Assignee
and, upon the due authorization, execution and delivery by the other parties hereto, will constitute the valid and legally binding
obligation of Assignee enforceable against Assignee in accordance with its terms except as enforceability may be limited by bankruptcy,
reorganization, insolvency, moratorium or other similar laws now or hereafter in effect relating to creditors’ rights generally,
and by general principles of equity regardless of whether enforceability is considered in a proceeding in equity or at law.

 

    	5-3

    	 

    

 

7.            Seller
warrants and represents to, and covenants with, Assignor, Depositor and Assignee as of the date hereof that:

 

(a)          Attached
hereto as Attachment 2 is a true and accurate copy of the Purchase Agreement, which agreement is in full force and effect as of
the date hereof and the provisions of which have not been waived, amended or modified in any respect, nor has any notice of termination
been given thereunder;

 

(b)          Seller
is duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation, and has all requisite
power and authority to perform its obligations under the Purchase Agreement;

 

(c)          Seller
has full corporate power and authority to execute, deliver and perform its obligations under this Agreement, and to consummate
the transactions set forth herein. The consummation of the transactions contemplated by this Agreement is in the ordinary course
of Seller’s business and will not conflict with, or result in a breach of, any of the terms, conditions or provisions of
Seller’s charter or by-laws or any legal restriction, or any material agreement or instrument to which Seller is now a party
or by which it is bound, or result in the violation of any law, rule, regulation, order, judgment or decree to which Seller or
its property is subject. The execution, delivery and performance by Seller of this Agreement and the consummation by it of the
transactions contemplated hereby, have been duly authorized by all necessary corporate action on part of Seller. This Agreement
has been duly executed and delivered by Seller and, upon the due authorization, execution and delivery by Assignor, Assignee and
the Depositor, will constitute the valid and legally binding obligation of Seller enforceable against Seller in accordance with
its terms except as enforceability may be limited by bankruptcy, reorganization, insolvency, moratorium or other similar laws now
or hereafter in effect relating to creditors’ rights generally, and by general principles of equity regardless of whether
enforceability is considered in a proceeding in equity or at law; and

 

(d)          No
consent, approval, order or authorization of, or declaration, filing or registration with, any governmental entity is required
to be obtained or made by Seller in connection with the execution, delivery or performance by Seller of this Agreement, or the
consummation by it of the transactions contemplated hereby.

 

Restated Seller Representations and Warranties

 

8.            Pursuant
to Section 32(d) of the Purchase Agreement, Seller hereby restates to Depositor and Assignee (a) the representations and warranties
set forth in Subsection 7.01 of the Purchase Agreement as of the related Closing Date and (b) the representations and warranties
set forth in Subsection 7.02 of the Purchase Agreement as of the date hereof, as if such representations and warranties were set
forth herein in full.

 

In the event of a breach
of any representations and warranties referred to in clauses (a) or (b) above as of the related Closing Date or the date hereof,
as the case may be, Assignee shall be entitled to all the remedies under the Purchase Agreement, including, without limitation,
the right to compel Seller to repurchase Mortgage Loans pursuant to Section 7.03 of the Purchase Agreement, subject to the provisions
of Section 10.

 

    	5-4

    	 

    

 

Recognition of Assignee

 

9.            From
and after the date hereof, subject to Section 10 below, Seller shall recognize Assignee as owner of the Mortgage Loans and will
perform its obligations hereunder for the benefit of the Assignee in accordance with the Purchase Agreement, as modified hereby
or as may be amended from time to time, as if Assignee and Seller had entered into a separate purchase agreement for the purchase
of the Mortgage Loans in the form of the Purchase Agreement, the terms of which are incorporated herein by reference, as amended
by this Agreement.

 

Enforcement of Rights 

 

10.          (a)          Controlling
Holder Rights. Seller agrees and acknowledges that [Sequoia Mortgage Funding Corporation], an Affiliate of the Depositor, in
its capacity as the initial Controlling Holder pursuant to the Pooling and Servicing Agreement, and for so long as it is the Controlling
Holder, will exercise all of Assignee's rights as Purchaser under the following section of the Purchase Agreement:

 

Purchase
Agreement:

 

	Section or Subsection	 	Matter
	 	 	 
	7.03, other than 7.03(c)	 	Repurchase and Substitution

 

(b)          If
there is no Controlling Holder under the Pooling and Servicing Agreement, then all rights that are to be exercised by the Controlling
Holder pursuant to Section 10(a) shall be exercised by Assignee.

 

Amendments to Purchase Agreement

 

11.          The
parties agree that the Purchase Agreement shall be amended, solely with respect to the Mortgage Loans, as follows:

 

(a)          Definitions.

 

    	5-5

    	 

    

 

(i)          The
definitions of “Business Day” and “Repurchase Price” set forth in Section 1 of the Purchase Agreement shall
be deleted and replaced in their entirety as follows:

 

 

Business
Day: Any day other than (i) a Saturday or a Sunday, (ii) a legal holiday in the states of California, Illinois, Maryland, Minnesota,
Missouri or New York, (iii) a day on which banks in the states of California, Illinois, Maryland, Minnesota, Missouri or New York,
are authorized or obligated by law or executive order to be closed or (iv) a day on which the New York Stock Exchange or the Federal
Reserve Bank of New York is closed.         

 

Repurchase
Price: With respect to any Mortgage Loan, a price equal to (i) the unpaid principal balance of the Mortgage Loan, plus (ii) interest
on such unpaid principal balance at the related Mortgage Interest Rate from the last date through which interest was last paid
by or on behalf of the Mortgagor to the last day of the month in which such repurchase occurs, plus (iii) reasonable and customary
third party expenses incurred in connection with the transfer of the Mortgage Loan being repurchased, minus (iv) any amounts received
in respect of such repurchased Mortgage Loan and being held for future distribution in connection with such Mortgage Loan.

 

(b)          The
rights under the Purchase Agreement assigned to the Depositor and the Assignee pursuant to this Agreement shall be under the Purchase
Agreement as amended by this Agreement.

 

Miscellaneous

 

12.          All
demands, notices and communications related to the Mortgage Loans, the Purchase Agreement and this Agreement shall be in writing
and shall be deemed to have been duly given if personally delivered at or mailed by registered mail, postage prepaid, as follows:

 

		(a)	In the case of Seller,

 

[             ]

 

		(b)	In the case of Assignee,

 

[U.S. Bank National Association

60 Livingston Avenue

EP-MN-WS3D

St. Paul, Minnesota,
55107

Attention: Structured
Finance – Sequoia Mortgage Loan Trust [    ]

 

    	5-6

    	 

    

 

		(c)	In the case of Depositor,

 

Sequoia Residential Funding,
Inc.

One Belvedere Place,
Suite 360

Mill Valley, California
94941

Attention: William Moliski

 

with a copy to

 

General Counsel at the
same address

 

		(d)	In the case of Assignor,

 

Redwood Residential Acquisition
Corporation

One Belvedere Place,
Suite 360

Mill Valley, California
94941

Attention: William Moliski

 

with a copy to

 

General Counsel at the
same address

 

		(e)	In the case of Master Servicer,

 

[Wells Fargo Bank,
N.A.

9062 Old Annapolis
Road

Columbia, Maryland
21045)

Telephone number:
(410) 884-2000

Facsimile number:
(410) 715-2380

Electronic mail
address: g=cts-spg-team-a-5@wellsfargo.com

Attention: Client
Manager — Sequoia Mortgage Trust ]

 

		(f)	In the case of the initial Controlling Holder,

 

[Sequoia Mortgage Funding
Corporation

One Belvedere Place,
Suite 360

Mill Valley, California
94941

Attention: William Moliski]

 

with a copy to

 

General Counsel at the
same address

 

13.          This
Agreement shall be construed in accordance with the laws of the State of New York, except to the extent preempted by Federal law,
and the obligations, rights and remedies of the parties hereunder shall be determined in accordance with such laws, without regard
to the conflicts of laws provisions of the State of New York or any other jurisdiction.

 

    	5-7

    	 

    

 

14.         No
term or provision of this Agreement may be waived or modified unless such waiver or modification is in writing and signed by the
party against whom such waiver or modification is sought to be enforced.

 

15.         This
Agreement shall inure to the benefit of the successors and assigns of the parties hereto. Any entity into which Assignor, Depositor,
Assignee or Seller may be merged or consolidated shall, without the requirement for any further writing, be deemed Assignor, Depositor,
Assignee or Seller, respectively, hereunder.

 

16.         This
Agreement shall survive the conveyance of the Mortgage Loans, the assignment of the representations and warranties made by Seller
pursuant to the Purchase Agreement to the extent of the Mortgage Loans by Assignor to Depositor and by Depositor to Assignee, and
the termination of the Purchase Agreement.

 

17.         This
Agreement may be executed simultaneously in any number of counterparts. Each counterpart shall be deemed to be an original, and
all such counterparts shall constitute one and the same instrument.

 

18.         The
Controlling Holder under the Pooling and Servicing Agreement is an express third party beneficiary of this Agreement, and shall
have the same power and ability to exercise and enforce the rights stated to be provided to it hereunder as if it were a signatory
hereto. Seller hereby consents to such exercise and enforcement.

 

19.         It
is expressly understood and agreed by the parties hereto that insofar as this Agreement is executed by the Trustee (i) this Agreement
is executed and delivered by [U.S. Bank National Association (“U.S. Bank”)] not in its individual capacity but solely
as Trustee on behalf of the trust created by the Pooling and Servicing Agreement referred to herein (the “Trust”) in
the exercise of the powers and authority conferred upon and vested in it, and as directed in the Pooling and Servicing Agreement,
(ii) each of the undertakings and agreements herein made on behalf of the Trust is made and intended not as a personal undertaking
or agreement of or by U.S. Bank but is made and intended for purposes of binding only the Trust, (iii) nothing herein contained
shall be construed as creating any liability on the part of U.S. Bank, individually or personally, to perform any covenant either
express or implied in this Agreement, all such liability, if any, being expressly waived by the parties hereto and by any person
claiming by, through or under the parties hereto, and (iv) under no circumstances shall U.S. Bank in its individual capacity or
in its capacity as Trustee be personally liable for the payment of any indebtedness, amounts or expenses owed by the Assignor under
the Purchase Agreement, as modified or supplemented by this Agreement (such indebtedness, expenses and other amounts being payable
solely from and to the extent of funds of the Trust) or be personally liable for the breach or failure of any obligation, representation,
warranty or covenant made under this Agreement or any other related documents.

 

    	5-8

    	 

    

 

20.          Master
Servicer. Seller hereby acknowledges that the Assignee has appointed [Wells Fargo Bank, N.A.] to act as master servicer and
securities administrator under the Pooling and Servicing Agreement and hereby agrees to treat all inquiries, demands, instructions,
authorizations and other communications from the Master Servicer as if the same had been received from the Assignee. The Master
Servicer, acting on behalf of the Assignee, shall have the rights of the Assignee as the Purchaser under this Agreement, including,
without limitation, the right to enforce the obligations of Seller hereunder and under the Purchase Agreement and the right to
exercise the remedies of the Purchaser hereunder and under the Purchase Agreement.

 

Seller shall make all
remittances due by it to the Purchaser with respect to the Mortgage Loans to the following account by wire transfer of immediately
available funds:

 

Wells Fargo Bank, N.A.

San Francisco, California

ABA# 121-000-248

Account #[             ]

Account Name: SAS Clearing

FFC: Account #[          ], Sequoia Mortgage Trust [          ]

Distribution Account

 

21.          Seller
acknowledges that the custodian will be Wells Fargo Bank, N.A. acting pursuant to the Custodial Agreement. Notwithstanding Section
10 of the Purchase Agreement, Seller shall pay shipping expenses for any Mortgage Loan Documents if there has been a breach of
any representation or warranty made with respect to the related Mortgage Loan in Subsection 7.01 of the Purchase Agreement.

 

22.          Rule
17g-5 Compliance. Seller hereby agrees that it shall provide information with respect to the Mortgage Loans or the origination
thereof to any Rating Agency or nationally recognized statistical rating organization (“NRSRO”) via electronic mail
at rmbs17g5informationprovider@wellsfargo.com, with a subject reference of “SEMT 2012-1” and an identification of the
type of information being provided in the body of such electronic mail. The Securities Administrator, as the initial Rule 17g-5
Information Provider (the “Rule 17g-5 Information Provider”) shall notify Seller in writing of any change in the identity
or contact information of the Rule 17g-5 Information Provider. Seller shall have no liability for (i) the Rule 17g-5 Information
Provider’s failure to post information provided by it in accordance with the terms of this Agreement or (ii) any malfunction
or disabling of the website maintained by the Rule 17g-5 Information Provider. None of the foregoing restrictions in this Section
22 prohibit or restrict oral or written communications, or providing information, between Seller, on the one hand, and any Rating
Agency or NRSRO, on the other hand, with regard to (i) such Rating Agency’s or NRSRO’s review of the ratings it assigns
to Seller or (ii) such Rating Agency’s or NRSRO’s evaluation of Seller’s operations in general; provided, however,
that Seller shall not provide any information relating to the Mortgage Loans to such Rating Agency or NRSRO in connection with
such review and evaluation by such Rating Agency or NRSRO unless: (x) borrower, property or deal specific identifiers are redacted;
or (y) such information has already been provided to the Rule 17g-5 Information Provider.

 

    	5-9

    	 

    

 

IN WITNESS WHEREOF,
the parties hereto have executed this Agreement the day and year first above written.

 

 

	REDWOOD RESIDENTIAL ACQUISITION CORPORATION
	Assignor
	 	 
	By:	 
	Name:	 
	Title:	 
	 	 
	SEQUOIA RESIDENTIAL FUNDING, INC.
	Depositor
	 	 
	By:	 
	Name:	 
	Title:	 
	 	 
	[                                 ], not in its individual capacity but solely as Trustee,
	Assignee
	 	 
	By:	 
	Name:	 
	Title:	 
	 	 
	[SELLER]
	 	 
	By:	 
	Name:	 
	Title:	 

 

Accepted and agreed to by:

 

[WELLS FARGO BANK, N.A.]

Master Servicer

 

	By:	 
	Name:	 
	Title:	 

 

    	5-10

    	 

    

 

ATTACHMENT 1

 

MORTGAGE LOAN SCHEDULE

 

    	 

    	 

    

 

ATTACHMENT 2

 

PURCHASE AGREEMENT

 

    	 

    	 

    

 

ADDENDUM I

 

REGULATION AB COMPLIANCE ADDENDUM

 TO FLOW PURCHASE AND
SALE AGREEMENT

 

 

SECTION
1. DEFINED TERMS

 

Capitalized
terms used but not defined herein shall have the meanings assigned to such terms in the Agreement. The following terms shall have
the meanings set forth below, unless the context clearly indicates otherwise:

 

Commission:
The United States Securities and Exchange Commission.

 

Company:
George Mason Mortgage, LLC

 

Company
Information: As defined in Section 2.04(a).

 

Depositor:
The depositor, as such term is defined in Regulation AB, with respect to any Securitization Transaction.

 

Exchange
Act: The Securities Exchange Act of 1934, as amended.

 

Master Servicer:
With respect to any Securitization Transaction, the “master servicer,” if any, identified in the related transaction
documents.

 

Qualified
Correspondent: Any Person from which the Company purchased Mortgage Loans, provided that this term shall not include the Purchaser
or an affiliate of the Purchaser and provided further that the following conditions are satisfied: (i) such Mortgage Loans were
originated pursuant to an agreement between the Company and such Person that contemplated that such Person would underwrite mortgage
loans from time to time, for sale to the Company, in accordance with underwriting guidelines designated by the Company (“Designated
Guidelines”) or guidelines that do not vary materially from such Designated Guidelines; (ii) such Mortgage Loans were in
fact underwritten as described in clause (i) above and were acquired by the Company within 180 days after origination; (iii) either
(x) the Designated Guidelines were, at the time such Mortgage Loans were originated, used by the Company in origination of mortgage
loans of the same type as the Mortgage Loans for the Company’s own account or (y) the Designated Guidelines were, at the
time such Mortgage Loans were underwritten, designated by the Company on a consistent basis for use by lenders in originating mortgage
loans to be purchased by the Company; and (iv) the Company employed, at the time such Mortgage Loans were acquired by the Company,
pre-purchase or post-purchase quality assurance procedures (which may involve, among other things, review of a sample of mortgage
loans purchased during a particular time period or through particular channels) designed to ensure that Persons from which it purchased
mortgage loans properly applied the underwriting criteria designated by the Company.

 

    	I-1

    	 

    

 

Reconstitution
Agreement: The agreement or agreements entered into by the Company and the Purchaser and/or certain third parties on the Reconstitution
Date or Dates with respect to any or all of the Mortgage Loans, in connection with a Whole Loan Transfer or Securitization Transaction.

 

Regulation
AB: Subpart 229.1100 — Asset Backed Securities (Regulation AB), 17 C.F.R. §§229.1100-229.1123, as such may
be amended from time to time, and subject to such clarification and interpretation as have been provided by the Commission in the
adopting release (Asset-Backed Securities, Securities Act Release No. 33-8518, 70 Fed. Reg. 1,505, 1,531 (Jan. 7, 2005)) or by
the staff of the Commission, or as may be provided by the Commission or its staff from time to time.

 

Securities
Act: The Securities Act of 1933, as amended.

 

Securitization
Transaction: Any transaction involving either (1) a sale or other transfer of some or all of the Mortgage Loans directly or
indirectly by the Purchaser to an issuing entity in connection with an issuance of publicly offered or privately placed, rated
or unrated mortgage-backed securities or (2) an issuance of publicly offered or privately placed, rated or unrated securities,
the payments on which are determined primarily by reference to one or more portfolios of residential mortgage loans consisting,
in whole or in part, of some or all of the Mortgage Loans.

 

Sponsor:
With respect to any Securitization Transaction, the Person identified in writing to the Company by the Purchaser as sponsor for
such Securitization Transaction.

 

Static Pool
Information: Static pool information as described in Item 1l05(a)(l)-(3) and 1105(c) of Regulation AB.

 

Third-Party
Originator: Each Person, other than a Qualified Correspondent, that originated Mortgage Loans acquired by the Company, provided
that this term shall not include originators of Mortgage Loans acquired by the Company from the Purchaser or an affiliate of the
Purchaser.

 

Whole Loan
Transfer: Any sale or transfer of some or all of the Mortgage Loans (including an Agency Transfer), other than a Securitization
Transaction.

 

    	I-2

    	 

    

 

SECTION
2. COMPLIANCE WITH REGULATION AB

 

Subsection
2.01 Intent of the Parties; Reasonableness. 

 

The Purchaser
and the Company acknowledge and agree that the purpose of this Regulation AB Addendum is to facilitate compliance by the Purchaser
and any Depositor with the provisions of Regulation AB and related rules and regulations of the Commission and that the provisions
of this Regulation AB Addendum shall be applicable to all Mortgage Loans included in a Securitization Transaction closing on or
after January 1, 2006, regardless whether the Mortgage Loans were purchased by the Purchaser from the Company prior to the date
hereof. Although Regulation AB is applicable by its terms only to offerings of asset-backed securities that are registered under
the Securities Act, the Company acknowledges that investors in privately offered securities may require that the Purchaser or any
Depositor provide comparable disclosure in unregistered offerings. References in this Regulation AB Addendum to compliance with
Regulation AB include provision of comparable disclosure in private offerings. The Purchaser and the Company also acknowledge and
agree that amendments to Regulation AB may become effective during the term of this Agreement and that both parties will use commercially
reasonable efforts to comply with such amendments.

 

Neither the
Purchaser nor any Depositor shall exercise its right to request delivery of information or other performance under these provisions
other than in good faith, or for purposes other than compliance with the Securities Act, the Exchange Act and the rules and regulations
of the Commission thereunder (or the provision in a private offering of disclosure comparable to that required under the Securities
Act). The Company acknowledges that interpretations of the requirements of Regulation AB may change over time, whether due to interpretive
guidance provided by the Commission or its staff, consensus among participants in the asset-backed securities markets, advice of
counsel, or otherwise, and agrees to comply with reasonable requests made by the Purchaser, any Master Servicer or any Depositor
in good faith for delivery of information under these provisions on the basis of evolving interpretations of Regulation AB. In
connection with any Securitization Transaction, the Company shall cooperate fully with the Purchaser and any Master Servicer to
deliver to the Purchaser (including any of its assignees or designees) and one of any Master Servicer or any Depositor (as requested),
any and all statements, reports, certifications, records and any other information necessary in the good faith determination of
the Purchaser or any Depositor to permit the Purchaser, such Master Servicer or such Depositor to comply with the provisions of
Regulation AB, together with such disclosures relating to the Company, any Third-Party Originator and the Mortgage Loans reasonably
believed by the Purchaser, the Master Servicer or any Depositor to be necessary in order to effect such compliance.

 

    	I-3

    	 

    

 

For purposes
of this Regulation AB Addendum, the term “Purchaser” shall refer to Redwood Residential Acquisition Corporation and
its successors in interest and assigns. In addition, any notice or request that must be “in writing” or “written”
may be made by electronic mail.

 

Subsection
2.02 Additional Representations and Warranties of the Company. 

 

(a)          The
Company shall be deemed to represent to the Purchaser, to any Master Servicer and to any Depositor, as of the date on which information
is first provided to the Purchaser, any Master Servicer or any Depositor under Section 2.03 that, except as disclosed in writing
to the Purchaser, such Master Servicer or such Depositor prior to such date: (i) there are no material legal or governmental proceedings
pending (or known to be contemplated) against the Company or any Third-Party Originator; and (ii) there are no affiliations, relationships
or transactions relating to the Company or any Third-Party Originator with respect to any Securitization Transaction and any party
thereto identified in writing to the Company by the related Depositor of a type described in Item 1119 of Regulation AB.

 

(b)          If
so requested in writing by the Purchaser, any Master Servicer or any Depositor on any date following the date on which information
is first provided to the Purchaser, any Master Servicer or any Depositor under Section 2.03, the Company shall use its best efforts
to confirm in writing within five (5) Business Days, but in no event later than ten (10) Business Days, following such request
the accuracy of the representations and warranties set forth in paragraph (a) of this Section or, if any such representation and
warranty is not accurate as of the date of such request, provide within five (5) Business Days, but in no event later than ten
(10) Business Days, reasonably adequate disclosure of the pertinent facts, in writing, to the requesting party.

 

Subsection
2.03 Information to Be Provided by the Company. 

 

In connection
with any Securitization Transaction, the Company shall use its best efforts to (i) within five (5) Business Days, but in no event
later than ten (10) Business Days, following written request by the Purchaser or any Depositor, provide to the Purchaser and such
Depositor (or, as applicable, cause each Third-Party Originator to provide), in writing and in form and substance reasonably satisfactory
to the Purchaser and such Depositor, the information and materials specified in paragraphs (a) and (b) of this Section, and (ii)
as promptly as practicable following notice to or discovery by the Company, provide to the Purchaser and any Depositor (in writing
and in form and substance reasonably satisfactory to the Purchaser and such Depositor) the information specified in paragraph (c)
of this Section.

 

    	I-4

    	 

    

 

(a)          If
so requested in writing by the Purchaser or any Depositor, the Company shall provide such information regarding (i) the Company,
as originator of the Mortgage Loans (including as an acquirer of Mortgage Loans from a Qualified Correspondent), or (ii) each Third-Party
Originator, as is requested for the purpose of compliance with Items 1103(a)(l), 1105, 1110, 1117 and 1119 of Regulation AB. Such
information shall include, at a minimum:

 

(A)         the
originator’s form of organization;

 

(B)         a
description of the originator’s origination program and how long the originator has been engaged in originating residential
mortgage loans, which description shall include a discussion of the originator’s experience in originating mortgage loans
of a similar type as the Mortgage Loans; information regarding the size and composition of the originator’s origination portfolio;
and information that may be material, in the good faith judgment of the Purchaser or any Depositor, to an analysis of the performance
of the Mortgage Loans, including the originators’ credit-granting or underwriting criteria for mortgage loans of similar
type(s) as the Mortgage Loans and such other information as the Purchaser or any Depositor may reasonably request for the purpose
of compliance with Item 1110(b)(2) of Regulation AB;

 

(C)         a
description of any legal or governmental proceedings pending (or known to be contemplated) against the Company and each Third-Party
Originator that would be material to securityholders; and

 

(D)         a
description of any affiliation or relationship between the Company, each Third-Party Originator and any of the following parties
to a Securitization Transaction, as such parties are identified to the Company by the Purchaser or any Depositor in writing in
advance of such Securitization Transaction:

 

(1)          the
sponsor;

(2)          the
depositor;

(3)          the
issuing entity;

(4)          any
servicer;

(5)          any
trustee;

(6)          any
originator;

(7)          any
significant obligor;

(8)          any
enhancement or support provider; and

(9)          any
other material transaction party.

 

(b)          If
so requested in writing by the Purchaser or any Depositor, the Company shall provide (or, as applicable, cause each Third-Party
Originator to provide) Static Pool Information solely with respect to securitized pools of mortgage loans (of a similar type as
the Mortgage Loans, as reasonably identified by the Purchaser as provided below) that were included in securitizations that closed
during the five (5) years preceding the closing date of the related Securitization Transaction. Such Static Pool Information shall
be prepared by the Company (or Third-Party Originator) on the basis of its reasonable, good faith interpretation of the requirements
of Item 1105(a)(3) of Regulation AB. To the extent that there is reasonably available to the Company (or Third-Party Originator)
Static Pool Information with respect to more than one mortgage loan type, the Purchaser or any Depositor shall be entitled to specify
whether some or all of such information shall be provided pursuant to this paragraph. The content of such Static Pool Information
may be in the form customarily provided by the Company, and need not be customized for the Purchaser or any Depositor. Such Static
Pool Information for each prior securitized pool shall be presented in increments no less frequently than quarterly over the life
of the mortgage loans included in such prior securitized pool. The most recent periodic increment must be as of a date no later
than 135 days prior to the date of the prospectus or other offering document in which the Static Pool Information is to be included
or incorporated by reference. The Static Pool Information shall be provided in an electronic format that provides a permanent record
of the information provided, such as a portable document format (pdf) file, or other such electronic format reasonably required
by the Purchaser or the Depositor, as applicable.

 

    	I-5

    	 

    

 

Promptly following
notice or discovery of a material error in Static Pool Information provided pursuant to the immediately preceding paragraph (including
an omission to include therein information required to be provided pursuant to such paragraph) during the applicable offering period
for the securities, the Company shall provide corrected Static Pool Information to the Purchaser or any Depositor, as applicable,
in the same format in which Static Pool Information was previously provided to such party by the Company.

 

If so requested
in writing by the Purchaser or any Depositor, the Company shall provide (or, as applicable, cause each Third-Party Originator to
provide), at the expense of the requesting party (to the extent of any additional incremental expense associated with delivery
pursuant to this Regulation AB Addendum), such statements and agreed-upon procedures letters of certified public accountants reasonably
acceptable to the Purchaser or Depositor, as applicable, pertaining to Static Pool Information relating to securitizations closed
on or after January 1, 2006, as the Purchaser or such Depositor shall reasonably request. Such statements and letters shall be
addressed to and be for the benefit of such parties as the Purchaser or such Depositor shall designate, which may include, by way
of example, any Sponsor, any Depositor and any broker dealer acting as underwriter, placement agent or initial purchaser with respect
to a Securitization Transaction. Any such statement or letter may take the form of a standard, generally applicable document accompanied
by a reliance letter authorizing reliance by the addressees designated by the Purchaser or such Depositor.

 

(c)          For
the purpose of satisfying its reporting obligation under the Exchange Act with respect to any class of asset-backed securities,
for so long as the Depositor is required to file reports under the Exchange Act with respect to a Securitization Transaction, the
Company shall (or shall cause each Third-Party Originator to) (i) provide prompt notice to the Purchaser, any Master Servicer and
any Depositor in writing of (A) any litigation or governmental proceedings pending against the Company or any Third-Party Originator
that would be material to securityholders and (B) any affiliations or relationships that develop following the closing date of
a Securitization Transaction between the Company or any Third-Party Originator and any of the parties specified in clause (D) of
paragraph (a) of this Section (and any other parties identified in writing by the requesting party) with respect to such Securitization
Transaction, but only to the extent that such affiliations or relationships do not include the Purchaser, Depositor or any of their
respective affiliates as a party, (C) any Event of Default of which it is aware or has received notice under the terms of the Agreement
or any Reconstitution Agreement and (D) any merger or consolidation where the Company is not the surviving entity or sale of substantially
all of the assets of the Company and (ii) provide to the Purchaser and any Depositor a description of such proceedings, affiliations
or relationships.

 

    	I-6

    	 

    

 

Subsection
2.04 Indemnification; Remedies. 

 

The Company
shall indemnify the Purchaser, each affiliate of the Purchaser, and each of the following parties participating in a Securitization
Transaction: each Sponsor; each issuing entity; each Person (including, but not limited to, any Master Servicer if applicable)
responsible for the preparation, execution or filing of any report required to be filed with the Commission with respect to such
Securitization Transaction, or for execution of a certification pursuant to Rule 13a-14(d) or Rule 15d-14(d) under the Exchange
Act with respect to such Securitization Transaction; each broker dealer acting as underwriter, placement agent or initial purchaser,
each Person who controls any of such parties or the Depositor (within the meaning of Section 15 of the Securities Act and Section
20 of the Exchange Act); and the respective present and former directors, officers, employees, agents and affiliates of each of
the foregoing and of the Depositor (each, an “Indemnified Party”), and shall hold each of them harmless from and against
any claims, losses, damages, penalties, fines, forfeitures, legal fees and expenses and related costs, judgments, and any other
costs, fees and expenses that any of them may sustain arising out of or based upon:

 

(a)          (A)
any untrue statement of a material fact contained or alleged to be contained in any information, report, certification, accountants’
letter or other material provided in written or electronic format under this Section 2 by or on behalf of the Company, or provided
under this Section 2 by or on behalf of any Third-Party Originator (collectively, the “Company Information”), or (B)
the omission or alleged omission to state in the Company Information a material fact required to be stated in the Company Information
or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading;
provided, by way of clarification, that clause (B) of this paragraph shall be construed solely by reference to the Company Information
and not to any other information communicated in connection with a sale or purchase of securities, without regard to whether the
Company Information or any portion thereof is presented together with or separately from such other information;

 

(b)          any
breach by the Company of its obligations under this Section 2, including particularly any failure by the Company or any Third-Party
Originator to deliver any information, report, certification, accountants’ letter or other material when and as required
under this Section 2;

 

    	I-7

    	 

    

 

(c)          any
breach by the Company of a representation or warranty set forth in Section 2.02(a) or in a writing furnished pursuant to Section
2.02(b) and made as of a date prior to the closing date of the related Securitization Transaction, to the extent that such breach
is not cured by such closing date, or any breach by the Company of a representation or warranty in a writing furnished pursuant
to Section 2.02(b) to the extent made as of a date subsequent to such closing date, or

 

(d)          the
negligence, bad faith or willful misconduct of the Company in connection with its performance under this Section 2.

 

If the indemnification
provided for herein is unavailable or insufficient to hold harmless an Indemnified Party, then the Company agrees that it shall
contribute to the amount paid or payable by such Indemnified Party as a result of any claims, losses, damages or liabilities incurred
by such Indemnified Party in such proportion as is appropriate to reflect the relative fault of such Indemnified Party on the one
hand and the Company on the other.

 

(e)          This
indemnification shall survive the termination of the Agreement or the termination of any party to the Agreement.

 

Subsection
2.05 Third-party Beneficiary. 

 

For purposes
of this Regulation AB Addendum and any related provisions thereto, each Master Servicer shall be considered a third-party beneficiary
of the Agreement, entitled to all the rights and benefits hereof as if it were a direct party to the Agreement.

 

    	I-8bNC bancorp

2013 OMNIBUS STOCK INCENTIVE PLAN

 

		SECTION	1.               
Purpose; Definitions

 

The purpose of this Plan is to give the
Company a competitive advantage in attracting, retaining and motivating officers, employees, directors and/or consultants and to
provide the Company and its Subsidiaries and Affiliates with a long-term incentive plan providing incentives directly linked to
shareholder value. Certain terms used herein have definitions given to them in the first place in which they are used. In addition,
for purposes of this Plan, the following terms are defined as set forth below:

 

(a)               
“Affiliate” means a corporation or other entity controlled by, controlling or under common control with
the Company.

 

(b)              
“Applicable Exchange” means the NASDAQ or such other securities exchange as may at the applicable time
be the principal market for the Common Stock.

 

(c)               
“Award” means an Option, Stock Appreciation Right, Restricted Stock, Restricted Stock Unit, Performance
Unit or Other Stock-Based Award granted pursuant to the terms of this Plan.

 

(d)              
“Award Agreement” means a written document or agreement setting forth the terms and conditions of a specific
Award.

 

(e)               
“Board” means the Board of Directors of the Company.

 

(f)               
“Cause” means, unless otherwise provided in an Award Agreement, (i) “Cause” as defined
in any Individual Agreement to which the applicable Participant is a party, or (ii) if there is no such Individual Agreement
or if it does not define “Cause”: (A) conviction of the Participant for committing a felony under federal law
or the law of the state in which such action occurred, (B) dishonesty in the course of fulfilling the Participant’s
employment duties, (C) failure on the part of the Participant to perform substantially such Participant’s employment
duties in any material respect, (D) a material violation of the Company’s ethics and compliance program, or (E) before
a Change in Control, such other events as shall be determined by the Committee and set forth in a Participant’s Award Agreement.
Notwithstanding the general rule of Section 2(c), following a Change in Control, any determination by the Committee as to
whether “Cause” exists shall be subject to de novo review.

 

(g)              
“Change in Control” has the meaning set forth in Section 10(e).

 

(h)              
“Code” means the Internal Revenue Code of 1986, as amended from time to time, and any successor thereto,
the Treasury Regulations thereunder and other relevant interpretive guidance issued by the Internal Revenue Service or the Treasury
Department. Reference to any specific section of the Code shall be deemed to include such regulations and guidance, as well as
any successor provision of the Code.

 

    	 

    	 

    

 

(i)                
“Commission” means the Securities and Exchange Commission or any successor agency.

 

(j)                
“Committee” has the meaning set forth in Section 2(a).

 

(k)              
“Common Stock” means the voting common stock, no par value per share, of the Company.

 

(l)                
“Company” means BNC Bancorp, a North Carolina corporation.

 

(m)            
“Disability” means (i) “Disability” as defined in any Individual Agreement to which
the Participant is a party, (ii) if there is no such Individual Agreement or it does not define “Disability,”
disability of a Participant means the Participant is (A) unable to engage in any substantial gainful activity by reason of
any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for
a continuous period of not less than 12 months, or (B) by reason of any medically determinable physical or mental impairment
that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, receiving
income replacement benefits for a period of not less than three months under an accident and health plan covering employees of
the Company. The Committee may require such medical or other evidence as it deems necessary to judge the nature and duration of
the Participant’s condition. Notwithstanding the above, with respect to an Incentive Stock Option, Disability shall mean
Permanent and Total Disability as defined in Section 22(e)(3) of the Code.

 

(n)              
“Disaffiliation” means a Subsidiary’s or Affiliate’s ceasing to be a Subsidiary or Affiliate
for any reason (including, without limitation, as a result of a public offering, or a spinoff or sale by the Company, of the stock
of the Subsidiary or Affiliate) or a sale of a division of the Company and its Affiliates.

 

(o)              
“Eligible Individuals” means directors, officers, employees and consultants of the Company or any of
its Subsidiaries or Affiliates, and prospective employees and consultants who have accepted offers of employment or consultancy
from the Company or its Subsidiaries or Affiliates.

 

(p)              
“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, and any successor
thereto.

 

(q)              
“Fair Market Value” means, unless otherwise determined by the Committee, the closing price of a share
of Common Stock on the Applicable Exchange on the date of measurement, or if Shares were not traded on the Applicable Exchange
on such measurement date, then on the next preceding date on which Shares were traded, all as reported by such source as the Committee
may select. If the Common Stock is not listed on a national securities exchange, Fair Market Value shall be determined by the Committee
in its good faith discretion using a reasonable valuation method which shall include consideration of the following factors, as
applicable: (i) the value of the Company’s tangible and intangible assets; (ii) the present value of the Company’s
future cash-flows; (iii) the market value of stock or equity interests in similar corporations and other entities engaged
in substantially similar trades or businesses, the value of which can be readily determined objectively (such as through trading
prices on an established securities market or an amount paid in an arm’s-length private transaction); (iv) control premiums
or discounts for lack of marketability; (v) recent arm’s-length transactions involving the sale or transfer of such
stock or equity interests; and (vi) other relevant factors.

 

    	-2-

    	 

    

 

(r)                
“Free-Standing SAR” has the meaning set forth in Section 5(b).

 

(s)               
“Full-Value Award” means any Award other than an Option or Stock Appreciation Right.

 

(t)                
“Good Reason” has the meaning set forth in Section 10(e).

 

(u)              
“Grant Date” means (i) the date on which the Committee by resolution selects an Eligible Individual
to receive a grant of an Award and determines the number of Shares to be subject to such Award, or (ii) such later date as
the Committee shall provide in such resolution.

 

(v)              
“Incentive Stock Option” means any Option that is designated in the applicable Award Agreement as an
“incentive stock option” within the meaning of Section 422 of the Code, and that in fact so qualifies.

 

(w)            
  “Individual Agreement” means an employment, consulting or similar agreement between a Participant and
the Company or one of its Subsidiaries or Affiliates.

 

(x)              
 “Nonqualified Option” means any Option that is not an Incentive Stock Option.

 

(y)              
 “Option” means an Award granted under Section 5.

 

(z)               
“Other Stock-Based Award” means Awards of Common Stock and other Awards that are valued in whole or in
part by reference to, or are otherwise based upon, Common Stock, including (without limitation) unrestricted stock, dividend equivalents,
and convertible debentures.

 

(aa)           
  “Participant” means an Eligible Individual to whom an Award is or has been granted.

 

(bb)          
   “Performance Goals” means the performance goals established by the Committee in connection with the grant
of Restricted Stock, Restricted Stock Units, Performance Units or Other Stock-Based Awards. In the case of Qualified Performance-Based
Awards, (i) such goals shall be based on the attainment of specified levels of one or more of the following measures: asset
growth, stock price , earnings (including earnings before taxes, earnings before interest and taxes or earnings before interest,
taxes, depreciation and amortization), earnings per share (whether on pre-tax, after-tax, operations or other basis), operating
earnings, total return to shareholders, ratio of debt to debt plus equity, net borrowing, credit quality or debt ratings, return
on assets or operating assets, asset quality, net interest margin, loan portfolio growth, efficiency ratio, deposit portfolio growth,
liquidity, market share, objective customer service measures or indices, shareholder value added, embedded value added, loss ratio,
expense ratio, combined ratio, premiums, pre- or after-tax income, net income, cash flow (before or after dividends), expense or
expense levels, economic value added, cash flow per share (before or after dividends), free cash flow, gross margin, risk-based
capital, revenues, revenue growth, sales growth, return on capital (including return on total capital or return on invested capital),
capital expenditures, cash flow return on investment, cost, cost control, gross profit, operating profit, economic profit, profit
before tax, net profit, cash generation, unit volume, sales, net asset value per share, asset quality, cost saving levels, market-spending
efficiency, core non-interest income or change in working capital, in each case with respect to the Company or any one or more
Subsidiaries, divisions, business units or business segments thereof, either in absolute terms or relative to the performance of
one or more other companies (including an index covering multiple companies), (ii) the Performance Goals may be adjusted as determined
by the Committee in a manner consistent with Section 3(d) and (iii) such Performance Goals shall be set by the Committee within
the time period prescribed by Section 162(m) of the Code.

 

    	-3-

    	 

    

 

(cc)           
“Performance Period” means that period established by the Committee at the time any Performance Unit
is granted or at any time thereafter during which any Performance Goals specified by the Committee with respect to such Award are
to be measured.

 

(dd)         
“Performance Unit” means any Award granted under Section 8 of a unit valued by reference to a designated
amount of cash or other property other than Shares, which value may be paid to the Participant by delivery of such property as
the Committee shall determine, including, without limitation, cash, Shares, or any combination thereof, upon achievement of such
Performance Goals during the Performance Period as the Committee shall establish at the time of such grant or thereafter.

 

(ee)           
“Plan” means this BNC Bancorp 2013 Omnibus Stock Incentive Plan, as set forth herein and as hereafter
amended from time to time.

 

(ff)            
“Qualified Performance-Based Award” means an Award intended to qualify for the Section 162(m) Exemption,
as provided in Section 11.

 

(gg)          
“Replaced Award” has the meaning set forth in Section 10(b).

 

(hh)          
“Replacement Award” has the meaning set forth in Section 10(b).

 

(ii)              “Restricted
Stock” means an Award granted under Section 6.

 

(jj)              “Restricted
Stock Unit” has the meaning set forth in Section 7.

 

(kk)          
  “Retirement” means the Participant’s Termination of Employment after the attainment of age 65 or
the attainment of age 55 and at least 15 years of service.

 

(ll)              “Section 162(m) Exemption” means the exemption from the limitation on deductibility imposed by Section 162(m)
of the Code that is set forth in Section 162(m)(4)(C) of the Code.

 

(mm)      
   “Share” means a share of Common Stock.

 

(nn)          
“Stock Appreciation Right” has the meaning set forth in Section 5(b).

 

    	-4-

    	 

    

 

 

(oo)          
“Subsidiary” means any corporation, partnership, joint venture, limited liability company or other entity
during any period in which at least a majority of the voting or profits interest is owned, directly or indirectly, by the Company
or any successor to the Company.

 

(pp)          
“Tandem SAR” has the meaning set forth in Section 5(b).

 

(qq)          
“Term” means the maximum period during which an Option or Stock Appreciation Right may remain outstanding,
subject to earlier termination upon Termination of Employment or otherwise, as specified in the applicable Award Agreement.

 

(rr)             
“Termination of Employment” means the termination of the applicable Participant’s employment with,
or performance of services for, the Company and any of its Subsidiaries or Affiliates. Unless otherwise determined by the Committee,
(i) if a Participant’s employment with the Company and its Affiliates terminates but such Participant continues to provide
services to the Company and its Affiliates in a non-employee capacity, such change in status shall not be deemed a Termination
of Employment and (ii) a Participant employed by, or performing services for, a Subsidiary or an Affiliate or a division of
the Company and its Affiliates shall be deemed to incur a Termination of Employment if, as a result of a Disaffiliation, such Subsidiary,
Affiliate, or division ceases to be a Subsidiary, Affiliate or division, as the case may be, and the Participant does not immediately
thereafter become an employee of, or service provider for, the Company or another Subsidiary or Affiliate. Temporary absences from
employment because of illness, vacation or leave of absence and transfers among the Company and its Subsidiaries and Affiliates
shall not be considered Terminations of Employment.

 

		SECTION	2.               
Administration

 

(a)               
Committee. The Plan shall be administered by the Compensation Committee of the Board or such other committee of the
Board as the Board may from time to time designate (the “Committee”), which shall be composed of not less than two
directors, and shall be appointed by and serve at the pleasure of the Board. The Committee shall, subject to Section 11, have
plenary authority to grant Awards pursuant to the terms of the Plan to Eligible Individuals. Among other things, the Committee
shall have the authority, subject to the terms and conditions of the Plan:

 

(i)                
to select the Eligible Individuals to whom Awards may from time to time be granted;

 

(ii)              
to determine whether and to what extent Incentive Stock Options, Nonqualified Options, Stock Appreciation Rights, Restricted
Stock, Restricted Stock Units, Performance Units, Other Stock-Based Awards, or any combination thereof, are to be granted hereunder;

 

(iii)            
to determine the number of Shares to be covered by each Award granted hereunder;

 

(iv)            
to determine the terms and conditions of each Award granted hereunder, based on such factors as the Committee shall determine;

 

    	-5-

    	 

    

 

(v)              
subject to Section 12, to modify, amend or adjust the terms and conditions of any Award;

 

(vi)            
to adopt, alter and repeal such administrative rules, guidelines and practices governing the Plan as it shall from time
to time deem advisable;

 

(vii)          
to interpret the terms and provisions of the Plan and any Award issued under the Plan (and any agreement relating thereto);

 

(viii)        
subject to Section 12, to accelerate the vesting or lapse of restrictions of any outstanding Award, based in each case
on such considerations as the Committee in its sole discretion determines;

 

(ix)            
to decide all other matters that must be determined in connection with an Award;

 

(x)              
to determine whether, to what extent and under what circumstances cash, Shares and other property and other amounts payable
with respect to an Award under this Plan shall be deferred either automatically or at the election of the Participant;

 

(xi)            
to establish any “blackout” period that the Committee in its sole discretion deems necessary or advisable; and

 

(xii)          
to otherwise administer the Plan.

 

(b)              
Procedures.

 

(i)                
The Committee may act only by a majority of its members then in office, except that the Committee may, except to the extent
prohibited by applicable law or the listing standards of the Applicable Exchange and subject to Section 11, allocate all or
any portion of its responsibilities and powers to any one or more of its members and may delegate all or any part of its responsibilities
and powers to any person or persons selected by it.

 

(ii)              
Subject to Section 11(c), any authority granted to the Committee may also be exercised by the full Board. To the extent
that any permitted action taken by the Board conflicts with action taken by the Committee, the Board action shall control.

 

(c)               
Discretion of Committee. Subject to Section 1(f), any determination made by the Committee or by an appropriately
delegated officer pursuant to delegated authority under the provisions of the Plan with respect to any Award shall be made in the
sole discretion of the Committee or such delegate at the time of the grant of the Award or, unless in contravention of any express
term of the Plan, at any time thereafter. All decisions made by the Committee or any appropriately delegated officer pursuant to
the provisions of the Plan shall be final, binding and conclusive on all persons, including the Company, Participants, and Eligible
Individuals.

 

(d)              
Cancellation or Suspension. Subject to Section 5(d), the Committee shall have full power and authority to determine
whether, to what extent and under what circumstances any Award shall be canceled or suspended. In particular, but without limitation,
all outstanding Awards to any Participant may be canceled if the Participant, without the consent of the Committee, while employed
by the Company or after termination of such employment, in either case prior to a Change in Control, becomes associated with, employed
by, renders services to, or owns any interest in (other than any nonsubstantial interest, as determined by the Committee), any
business that is in competition with the Company or with any business in which the Company has a substantial interest, as determined
by the Committee or any one or more Senior Managers or committee of senior managers to whom the authority to make such determination
is delegated by the Committee.

 

    	-6-

    	 

    

 

(e)               
Award Agreements. The terms and conditions of each Award, as determined by the Committee, shall be set forth in a
written (or electronic) Award Agreement, which shall be delivered to the Participant receiving such Award upon, or as promptly
as is reasonably practicable following, the grant of such Award. The effectiveness of an Award shall be subject to the Award Agreement’s
being signed by the Company and the Participant receiving the Award unless otherwise provided in the Award Agreement. Award Agreements
may be amended only in accordance with Section 12 hereof.

 

		SECTION	3.               
Common Stock Subject to Plan

 

(a)               
Plan Maximums. The maximum number of Shares that may be granted pursuant to Awards under the Plan shall be 1,500,000.
The maximum number of Shares that may be granted pursuant to Options intended to be Incentive Stock Options shall be 1,500,000
Shares. Shares subject to an Award under the Plan may be authorized and unissued Shares. On and after the Effective Date
(as defined in Section 12(a)), no new awards may be granted under the Company’s Omnibus Stock Ownership and Long Term Incentive
Plan, as amended, it being understood that (A) awards outstanding under such plan as of the Effective Date shall remain in full
force and effect under such plan according to their respective terms, and (B) to the extent that any such award is forfeited, terminates,
expires or lapses without being exercised (to the extent applicable), or is settled for cash, the Shares subject to such award
not delivered as a result thereof shall not be available for Awards under this Plan; provided, however, that dividend
equivalents may continue to be issued under such plan in respect of awards granted under such plan which are outstanding as of
the Effective Date.

 

(b)              
Individual Limits. No Participant may be granted Qualified Performance-Based Awards (other than Stock Options and
Stock Appreciation Rights) covering in excess of 300,000 Shares during any calendar year. No Participant may be granted Stock Options
and Stock Appreciation Rights covering in excess of 300,000 Shares during any calendar year. Notwithstanding the foregoing, no
Participant who is a non-employee director of the Company may be granted Awards covering in excess of 25,000 Shares during any
calendar year.

 

(c)               
Rules for Calculating Shares Delivered. To the extent that any Award is forfeited, or any Option and the related
Tandem SAR (if any) or Free-Standing SAR terminates, expires or lapses without being exercised, or any Award is settled for cash,
the Shares subject to such Awards not delivered as a result thereof shall again be available for Awards under the Plan. If the
exercise price of any Option and/or the tax withholding obligations relating to any Award are satisfied by delivering Shares (either
actually or through attestation) or withholding Shares relating to such Award, the gross number of Shares subject to the Award
shall nonetheless be deemed to have been granted for purposes of the first sentence of Section 3(a).

 

    	-7-

    	 

    

 

(d)              
Adjustment Provision. In the event of a merger, consolidation, acquisition of property or shares, stock rights offering,
liquidation, disposition for consideration of the Company’s direct or indirect ownership of a Subsidiary or Affiliate (including
by reason of a Disaffiliation), or similar event affecting the Company or any of its Subsidiaries (each, a “Corporate
Transaction”), the Committee or the Board may in its discretion make such substitutions or adjustments as it deems appropriate
and equitable to (A) the aggregate number and kind of Shares or other securities reserved for issuance and delivery under
the Plan, (B) the various maximum limitations set forth in Sections 3(a) and 3(b) upon certain types of Awards and upon the
grants to individuals of certain types of Awards, (C) the number and kind of Shares or other securities subject to outstanding
Awards; and (D) the exercise price of outstanding Awards. In the event of a stock dividend, stock split, reverse stock split,
reorganization, share combination, or recapitalization or similar event affecting the capital structure of the Company, or a Disaffiliation,
separation or spinoff, in each case without consideration, or other extraordinary dividend of cash or other property to the Company’s
shareholders (each, a “Share Change”), the Committee or the Board shall make such substitutions or adjustments as it
deems appropriate and equitable to (A) the aggregate number and kind of Shares or other securities reserved for issuance and
delivery under the Plan, (B) the various maximum limitations set forth in Sections 3(a) and 3(b) upon certain types of Awards
and upon the grants to individuals of certain types of Awards, (C) the number and kind of Shares or other securities subject
to outstanding Awards; and (D) the exercise price of outstanding Awards. In the case of Corporate Transactions, such adjustments
may include, without limitation, (1) the cancellation of outstanding Awards in exchange for payments of cash, property or
a combination thereof having an aggregate value equal to the value of such Awards, as determined by the Committee or the Board
in its sole discretion (it being understood that in the case of a Corporate Transaction with respect to which shareholders of Common
Stock receive consideration other than publicly traded equity securities of the ultimate surviving entity, any such determination
by the Committee that the value of an Option or Stock Appreciation Right shall for this purpose be deemed to equal the excess,
if any, of the value of the consideration being paid for each Share pursuant to such Corporate Transaction over the exercise price
of such Option or Stock Appreciation Right shall conclusively be deemed valid); (2) the substitution of other property (including,
without limitation, cash or other securities of the Company and securities of entities other than the Company) for the Shares subject
to outstanding Awards; and (3) in connection with any Disaffiliation, arranging for the assumption of Awards, or replacement
of Awards with new awards based on other property or other securities (including, without limitation, other securities of the Company
and securities of entities other than the Company), by the affected Subsidiary, Affiliate, or division or by the entity that controls
such Subsidiary, Affiliate, or division following such Disaffiliation (as well as any corresponding adjustments to Awards that
remain based upon Company securities). The Committee may adjust the Performance Goals applicable to any Awards to reflect any unusual
or non-recurring events and other extraordinary items, impact of charges for restructurings, discontinued operations, and the cumulative
effects of accounting or tax changes, each as defined by generally accepted accounting principles or as identified in the Company’s
financial statements, notes to the financial statements, management’s discussion and analysis or other the Company’s
SEC filings, provided that in the case of Performance Goals applicable to any Qualified Performance-Based Awards, such adjustment
does not violate Section 162(m) of the Code.

 

    	-8-

    	 

    

 

(e)               
Section 409A. Notwithstanding the foregoing: (i) any adjustments made pursuant to Section 3(d) to
Awards that are considered “deferred compensation” within the meaning of Section 409A of the Code shall be made
in compliance with the requirements of Section 409A of the Code; and (ii) any adjustments made pursuant to Section 3(d)
to Awards that are not considered “deferred compensation” subject to Section 409A of the Code shall be made in
such a manner as to ensure that after such adjustments, either (A) the Awards continue not to be subject to Section 409A of
the Code or (B) there does not result in the imposition of any penalty taxes under Section 409A of the Code in respect of
such Awards.

 

		SECTION	4.               
Eligibility

 

Awards may be granted under the Plan to
Eligible Individuals; provided, however, that Incentive Stock Options may be granted only to employees of the Company and
its subsidiaries or parent corporation (within the meaning of Section 424(f) of the Code).

 

		SECTION	5.               
Options and Stock Appreciation Rights

 

(a)               
Types of Options. Options may be of two types: Incentive Stock Options and Nonqualified Options. The Award Agreement
for an Option shall indicate whether the Option is intended to be an Incentive Stock Option or a Nonqualified Option.

 

(b)              
Types and Nature of Stock Appreciation Rights. Stock Appreciation Rights may be “Tandem SARs,” which
are granted in conjunction with an Option, or “Free-Standing SARs,” which are not granted in conjunction with an Option.
Upon the exercise of a Stock Appreciation Right, the Participant shall be entitled to receive an amount in cash, Shares, or both,
in value equal to the product of (i) the excess of the Fair Market Value of one Share over the exercise price of the applicable
Stock Appreciation Right, multiplied by (ii) the number of Shares in respect of which the Stock Appreciation Right has been
exercised. The applicable Award Agreement shall specify whether such payment is to be made in cash or Common Stock or both, or
shall reserve to the Committee or the Participant the right to make that determination prior to or upon the exercise of the Stock
Appreciation Right.

 

(c)               
Tandem SARs. A Tandem SAR may be granted at the Grant Date of the related Option. A Tandem SAR shall be exercisable
only at such time or times and to the extent that the related Option is exercisable in accordance with the provisions of this Section 5,
and shall have the same exercise price as the related Option. A Tandem SAR shall terminate or be forfeited upon the exercise or
forfeiture of the related Option, and the related Option shall terminate or be forfeited upon the exercise or forfeiture of the
Tandem SAR.

 

(d)              
Exercise Price. The exercise price per Share subject to an Option or Free-Standing SAR shall be determined by the
Committee and set forth in the applicable Award Agreement, and shall not be less than the Fair Market Value of a share of the Common
Stock on the applicable Grant Date. In no event may any Option or Stock Appreciation Right granted under this Plan be amended,
other than pursuant to Section 3(d), to decrease the exercise price thereof, be cancelled in conjunction with the grant of
any new Option or Free-Standing SAR with a lower exercise price, or otherwise be subject to any action that would be treated, under
the Applicable Exchange listing standards or for accounting purposes, as a “repricing” of such Option or Free-Standing
SAR, unless such amendment, cancellation, or action is approved by the Company’s shareholders.

 

    	-9-

    	 

    

 

(e)               
Term. The Term of each Option and each Free-Standing SAR shall be fixed by the Committee, but shall not exceed ten
years from the Grant Date.

 

(f)               
Vesting and Exercisability. Except as otherwise provided herein, Options and Free-Standing SARs shall be exercisable
at such time or times and subject to such terms and conditions as shall be determined by the Committee, provided that, except as
otherwise determined by the Committee, in no event shall the normal vesting schedule of an Option or Free-Standing SAR provide
that such Option or Free-Standing SAR vest prior to the first anniversary of the date of grant.

 

(g)              
Method of Exercise. Subject to the provisions of this Section 5, Options and Free-Standing SARs may be exercised,
in whole or in part, at any time during the applicable term by giving written notice of exercise to the Company specifying the
number of shares of Common Stock as to which the Option or Free-Standing SAR is being exercised. In the case of the exercise of
an Option, such notice shall be accompanied by payment in full of the purchase price (which shall equal the product of such number
of shares multiplied by the applicable exercise price) by certified or bank check or such other instrument as the Company may accept
or, if approved by the Committee, payment, in full or in part, may also be made as follows:

 

(i)                
Payments may be made in the form of unrestricted shares of Common Stock (by delivery of such shares or by attestation) of
the same class as the Common Stock subject to the Option already owned by the Participant (based on the Fair Market Value of the
Common Stock on the date the Option is exercised).

 

(ii)              
To the extent permitted by applicable law, payment may be made by delivering a properly executed exercise notice to the
Company, together with a copy of irrevocable instructions to a broker to deliver promptly to the Company the amount of sale or
loan proceeds necessary to pay the purchase price, and, if requested, the amount of any federal, state, local or foreign withholding
taxes. To facilitate the foregoing, the Company may, to the extent permitted by applicable law, enter into agreements for coordinated
procedures with one or more brokerage firms. To the extent permitted by applicable law, the Committee may also provide for Company
loans to be made for purposes of the exercise of Options.

 

(iii)            
Payment may be made by instructing the Company to withhold a number of shares of Common Stock having a Fair Market Value
(based on the Fair Market Value of the Common Stock on the date the applicable Option is exercised) equal to the product of (A) the
exercise price multiplied by (B) the number of shares of Common Stock in respect of which the Option shall have been exercised.

 

(h)              
Delivery; Rights of Shareholders. No Shares shall be delivered pursuant to the exercise of an Option until the exercise
price therefor has been fully paid and applicable taxes have been withheld. The applicable Participant shall have all of the rights
of a shareholder of the Company holding the class or series of Common Stock that is subject to the Option or Stock Appreciation
Right (including, if applicable, the right to vote the applicable Shares and the right to receive dividends) when the Participant
(i) has given written notice of exercise, (ii) if requested, has given the representation described in Section 14(a),
and (iii) in the case of an Option, has paid in full for such Shares.

 

    	-10-

    	 

    

 

(i)                
Nontransferability of Options and Stock Appreciation Rights. No Option or Free-Standing SAR shall be transferable
by a Participant other than, for no value or consideration, (i) by will or by the laws of descent and distribution, or (ii) in
the case of a Nonqualified Option or Free-Standing SAR, as otherwise expressly permitted by the Committee including, if so permitted,
pursuant to a transfer to the Participant’s family members, whether directly or indirectly or by means of a trust or partnership
or otherwise (for purposes of this Plan, unless otherwise determined by the Committee, “family member” shall have the
meaning given to such term in General Instructions A.1(a)(5) to Form S-8 under the Securities Act of 1933, as amended, and any
successor thereto). A Tandem SAR shall be transferable only with the related Option as permitted by the preceding sentence. Any
Option or Stock Appreciation Right shall be exercisable, subject to the terms of this Plan, only by the applicable Participant,
the guardian or legal representative of such Participant, or any person to whom such Option or Stock Appreciation Right is permissibly
transferred pursuant to this Section 5(i), it being understood that the term “Participant” includes such guardian,
legal representative and other transferee; provided, however, that the term “Termination of Employment” shall
continue to refer to the Termination of Employment of the original Participant.

 

(j)                
Termination of Employment. A Participant’s Options and Stock Appreciation Rights shall be forfeited upon his
or her Termination of Employment, except as set forth below:

 

(i)                
Upon a Participant’s Termination of Employment for any reason other than death, Disability, Retirement or Cause, any
Option or Stock Appreciation Right held by the Participant that was exercisable immediately before the Termination of Employment
may be exercised at any time until the earlier of (A) the 90th day following such Termination of Employment and (B) expiration
of the Term thereof;

 

(ii)              
Upon a Participant’s Termination of Employment by reason of the Participant’s death, any Option or Stock Appreciation
Right held by the Participant shall vest and be exercisable at any time until the earlier of (A) the third anniversary of
the date of such death and (B) the expiration of the Term thereof;

 

(iii)            
Upon a Participant’s Termination of Employment by reason of Disability, any Option or Stock Appreciation Right held
by the Participant shall vest and be exercisable at any time until (A) in the case of Nonqualified Options and Stock Appreciation
Rights, the expiration of the Term thereof, and (B) in the case of Incentive Stock Options, the earlier of (x) the first anniversary
of the date of such Termination of Employment and (y) the expiration of the Term thereof;

 

(iv)            
Upon a Participant’s Termination of Employment for Retirement, any Option or Stock Appreciation Right held by the
Participant shall vest and be exercisable at any time until the earlier of (A) in the case of Nonqualified Options and Stock
Appreciation Rights, (x) the fifth anniversary of such Termination of Employment and (y) the expiration of the Term thereof,
and (B) in the case of Incentive Stock Options, (x) the 90th day following such Termination of Employment and (y) the expiration
of the Term thereof; and

 

    	-11-

    	 

    

 

(k)              
Notwithstanding the foregoing, the Committee shall have the power, in its discretion, to apply different rules concerning
the consequences of a Termination of Employment, provided, that if such rules are less favorable to the Participant than
those set forth above, such rules are set forth in the applicable Award Agreement.

 

		SECTION	6.               
Restricted Stock

 

(a)               
Nature of Awards and Certificates. Shares of Restricted Stock are actual Shares issued to a Participant and shall
be evidenced in such manner as the Committee may deem appropriate, including book-entry registration or issuance of one or more
stock certificates. Any certificate issued in respect of Shares of Restricted Stock shall be registered in the name of the applicable
Participant and shall bear an appropriate legend referring to the terms, conditions, and restrictions applicable to such Award,
substantially in the following form:

 

“The transferability of this certificate and the shares
of stock represented hereby are subject to the terms and conditions (including forfeiture) of the BNC Bancorp 2013 Omnibus Stock
Incentive Plan and an Award Agreement. Copies of such Plan and Agreement are on file at the offices of BNC Bancorp, [INSERT ADDRESS].”

 

The Committee may require that the certificates evidencing such
shares be held in custody by the Company until the restrictions thereon shall have lapsed and that, as a condition of any Award
of Restricted Stock, the applicable Participant shall have delivered a stock power, endorsed in blank, relating to the Common Stock
covered by such Award.

 

(b)              
Terms and Conditions. Shares of Restricted Stock shall be subject to the following terms and conditions:

 

(i)                
The Committee shall, prior to or at the time of grant, condition (A) the vesting of an Award of Restricted Stock upon
the continued service of the applicable Participant, or (B) the grant or vesting of an Award of Restricted Stock upon the
attainment of Performance Goals or the attainment of Performance Goals and the continued service of the applicable Participant.
In the event that the Committee conditions the grant or vesting of an Award of Restricted Stock upon the attainment of Performance
Goals or the attainment of Performance Goals and the continued service of the applicable Participant, the Committee may, prior
to or at the time of grant, designate an Award of Restricted Stock as a Qualified Performance-Based Award. The conditions for grant
or vesting and the other provisions of Restricted Stock Awards (including without limitation any applicable Performance Goals)
need not be the same with respect to each recipient.

 

    	-12-

    	 

    

 

(ii)              
Subject to the provisions of the Plan and the applicable Award Agreement, during the period, if any, set by the Committee,
commencing with the date of such Restricted Stock Award for which such vesting restrictions apply (the “Restriction Period”),
and until the expiration of the Restriction Period, the Participant shall not be permitted to sell, assign, transfer, pledge or
otherwise encumber Shares of Restricted Stock. Subject to the terms of the Plan and the applicable Award Agreement, any Award of
Restricted Stock shall be subject to vesting during a Restriction Period of at least three years following the date of grant, provided
that a Restriction Period of at least one year following the date of grant is permissible if vesting is conditioned upon the
achievement of Performance Goals, and provided, further that an Award may vest in part on a pro rata basis prior to the
expiration of any Restriction Period, and provided, further, that up to five percent of Shares available for grant
as Restricted Stock (together with all other Shares available for grant as Full-Value Awards) may be granted without regard to
the foregoing requirements and the Committee may accelerate the vesting and lapse of any restrictions with respect to any such
Restricted Stock Awards.

 

(iii)            
Except as provided in this Section 6 and in the applicable Award Agreement, the applicable Participant shall have,
with respect to the Shares of Restricted Stock, all of the rights of a shareholder of the Company holding the class or series of
Common Stock that is the subject of the Restricted Stock, including, if applicable, the right to vote the Shares and the right
to receive any cash dividends.

 

(iv)            
If and when any applicable Performance Goals are satisfied and the Restriction Period expires without a prior forfeiture
of the Shares of Restricted Stock for which legended certificates have been issued, unlegended certificates for such Shares shall
be delivered to the Participant upon surrender of the legended certificates.

 

		SECTION	7.               
Restricted Stock Units

 

(a)               
Nature of Awards. Restricted stock units and deferred share rights (together, “Restricted Stock Units”)
are Awards denominated in Shares that will be settled, subject to the terms and conditions of the Restricted Stock Units, in an
amount in cash, Shares, or both, based upon the Fair Market Value of a specified number of Shares.

 

(b)              
Terms and Conditions. Restricted Stock Units shall be subject to the following terms and conditions:

 

(i)                
The Committee shall, prior to or at the time of grant, condition (A) the vesting of Restricted Stock Units upon the
continued service of the applicable Participant, or (B) the grant or vesting of Restricted Stock Units upon the attainment
of Performance Goals or the attainment of Performance Goals and the continued service of the applicable Participant. In the event
that the Committee conditions the grant or vesting of Restricted Stock Units upon the attainment of Performance Goals or the attainment
of Performance Goals and the continued service of the applicable Participant, the Committee may, prior to or at the time of grant,
designate the Restricted Stock Units as a Qualified Performance-Based Awards. The conditions for grant or vesting and the other
provisions of Restricted Stock Units (including without limitation any applicable Performance Goals) need not be the same with
respect to each recipient. An Award of Restricted Stock Units shall be settled as and when the Restricted Stock Units vest, at
a later time specified by the Committee or in the applicable Award Agreement, or, if the Committee so permits, in accordance with
an election of the Participant.

 

    	-13-

    	 

    

 

(ii)              
Subject to the provisions of the Plan and the applicable Award Agreement, during the period, if any, set by the Committee,
commencing with the date of such Restricted Stock Units for which such vesting restrictions apply (the “Restriction Period”),
and until the expiration of the Restriction Period, the Participant shall not be permitted to sell, assign, transfer, pledge or
otherwise encumber Restricted Stock Units. Subject to the terms of the Plan and the applicable Award Agreement, any Restricted
Stock Units shall be subject to vesting during a Restriction Period of at least three years following the date of grant, provided
that a Restriction Period of at least one year following the date of grant is permissible if vesting is conditioned upon the
achievement of Performance Goals, and provided, further that a Restricted Stock Unit may vest in part prior to the expiration
of any Restriction Period, and provided, further, that up to five percent of Shares available for grant as Restricted
Stock Units (together with all other Shares available for grant as Full-Value Awards) may be granted without regard to the foregoing
requirements and the Committee may accelerate the vesting and lapse any restrictions with respect to any such Restricted Stock
Units.

 

(iii)            
The Award Agreement for Restricted Stock Units shall specify whether, to what extent and on what terms and conditions the
applicable Participant shall be entitled to receive payments of cash, Common Stock or other property corresponding to the dividends
payable on the Common Stock (subject to availability of Shares pursuant to Section 3 hereof).

 

		SECTION	8.               
Performance Units.

 

Performance Units may be issued hereunder
to Eligible Individuals, for no cash consideration or for such minimum consideration as may be required by applicable law, either
alone or in addition to other Awards granted under the Plan. The Performance Goals to be achieved during any Performance Period
and the length of the Performance Period shall be determined by the Committee upon the grant of each Performance Unit, provided
that the Performance Period shall be no less than one year following the date of grant. The Committee may, in connection with
the grant of Performance Units, designate them as Qualified Performance-Based Awards. The conditions for grant or vesting and the
other provisions of Performance Units (including without limitation any applicable Performance Goals) need not be the same with
respect to each recipient. Performance Units may be paid in cash, Shares, other property or any combination thereof, in the sole
discretion of the Committee as set forth in the applicable Award Agreement. The maximum value of the property, including cash,
that may be paid or distributed to any Participant pursuant to a grant of Performance Units made in any one calendar year shall
be $500,000.

 

    	-14-

    	 

    

 

		SECTION	9.               
Other Stock-Based Awards

 

Other Stock-Based Awards may be granted
under the Plan, provided that any Other Stock-Based Awards that are Awards of Common Stock that are unrestricted shall only
be granted in lieu of other compensation due and payable to the Participant. Subject to the terms of the Plan and the applicable
Award Agreement, any Other Stock-Based Award that is a Full-Value Award shall be subject to vesting during a Restriction Period
of at least three years following the date of grant, provided that a Restriction Period of at least one year following the
date of grant is permissible if vesting is conditioned upon the achievement of Performance Goals, and provided, further
that an Other Stock-Based Award that is a Full-Value Award may vest in part on a pro rata basis prior to the expiration of any
Restriction Period, and provided, further, that up to five percent of Shares available for grant as Other Stock-Based
Awards that are Full-Value Awards (together with all other Shares available for grant as Full-Value Awards) may be granted without
regard to the foregoing requirements and the Committee may accelerate the vesting and lapse of any restrictions with respect to
any such Other Stock-Based Awards.

 

		SECTION	10.           
Change in Control Provisions

 

(a)               
General. The provisions of this Section 10 shall, subject to Section 3(d) and Section 10(f), apply notwithstanding
any other provision of the Plan to the contrary, except to the extent the Committee specifically provides otherwise in an Award
Agreement.

 

(b)              
Impact of Change in Control. Upon the occurrence of a Change in Control, unless otherwise provided in the applicable
Award Agreement: (i) all then-outstanding Options and Stock Appreciation Rights shall become fully vested and exercisable, and
all Full-Value Awards (other than performance-based Awards) shall vest in full, be free of restrictions, and be deemed to be earned
and payable in an amount equal to the full value of such Award, except in each case to the extent that another Award meeting the
requirements of Section 10(c) (any award meeting the requirements of Section 10(c), a “Replacement Award”) is provided
to the Participant pursuant to Section 3(d) to replace such Award (any award intended to be replaced by a Replacement Award, a
“Replaced Award”), and (ii) any performance-based Award that is not replaced by a Replacement Award shall be deemed
to be earned and payable in an amount equal to the full value of such performance-based Award (with all applicable Performance
Goals deemed achieved at the greater of (x) the applicable target level and (y) the level of achievement of the Performance Goals
for the Award as determined by the Committee not later than the date of the Change in Control, taking into account performance
through the latest date preceding the Change in Control as to which performance can, as a practical matter, be determined (but
not later than the end of the applicable Performance Period)) multiplied by a fraction, the numerator of which is the number of
days during the applicable Performance Period before the date of the Change in Control, and the denominator of which is the number
of days in the applicable Performance Period; provided, however, that such fraction shall be equal to one in the
event that the applicable Performance Goals in respect of such performance-based Awards have been fully achieved as of the date
of such Change in Control.

 

(c)               
Replacement Awards. An Award shall meet the conditions of this Section 10(c) (and hence qualify as a Replacement
Award) if: (i) it is of the same type as the Replaced Award; (ii) it has a value equal to the value of the Replaced Award as of
the date of the Change in Control; (iii) if the underlying Replaced Award was an equity-based award, it relates to publicly traded
equity securities of the Company or the entity surviving the Company following the Change in Control; (iv) it contains terms relating
to vesting (including with respect to a Termination of Employment) that are substantially identical to those of the Replaced Award;
and (v) its other terms and conditions are not less favorable to the Participant than the terms and conditions of the Replaced
Award (including the provisions that would apply in the event of a subsequent Change in Control) as of the date of the Change in
Control. Without limiting the generality of the foregoing, a Replacement Award may take the form of a continuation of the applicable
Replaced Award if the requirements of the preceding sentence are satisfied. If a Replacement Award is granted, the Replaced Award
shall not vest upon the Change in Control. The determination whether the conditions of this Section 10(c) are satisfied shall be
made by the Committee, as constituted immediately before the Change in Control, in its sole discretion.

 

    	-15-

    	 

    

 

(d)              
Termination of Employment. Upon a Termination of Employment of a Participant occurring upon or during the two years
immediately following the date of a Change in Control by reason of death, Disability or Retirement, by the Company without Cause,
or by the Participant for “Good Reason” (as defined in Section 10(e)), (i) all Replacement Awards held by such Participant
shall vest in full, be free of restrictions, and be deemed to be earned in an amount equal to the full value of such Replacement
Award, and (ii) unless otherwise provided in the applicable Award Agreement, notwithstanding any other provision of the Plan to
the contrary, any Option or Stock Appreciation Right held by the Participant as of the date of the Change in Control that remains
outstanding as of the date of such Termination of Employment may thereafter be exercised, until (A) in the case of Incentive Stock
Options, the last date on which such Incentive Stock Options would be exercisable in the absence of this Section 10(d), and (B)
in the case of Nonqualified Options and Stock Appreciation Rights, the later of (x) the last date on which such Nonqualified Option
or Stock Appreciation Right would be exercisable in the absence of this Section 10(d) and (y) the earlier of (1) the third anniversary
of such Change in Control and (y) expiration of the Term of such Nonqualified Option or Stock Appreciation Right.

 

(e)               
Definition of Change in Control. For purposes of the Plan:

 

“Change in Control”
shall mean any of the following events:

 

(i)                      
Any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934,
as amended (the “Exchange Act”)) (a “Person”) becomes the beneficial owner (within the meaning of Rule
13d-3 promulgated under the Exchange Act) of 35% or more of either (A) the then-outstanding shares of common stock of the Company
(the “Outstanding Company Common Stock”) or (B) the combined voting power of the then-outstanding voting securities
of the Company entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”);
provided, however, that, for purposes of this definition, the following acquisitions shall not constitute a Change
of Control: (w) any acquisition directly from the Company, (x) any acquisition by the Company, (y) any acquisition by any employee
benefit plan (or related trust) sponsored or maintained by the Company or any Affiliated Company or (z) any acquisition pursuant
to a transaction that complies with clauses (iii)(A), (iii)(B) and (iii)(C) below;

 

    	-16-

    	 

    

 

(ii)                    
Individuals who, as of the Effective Date, constitute the Board (the “Incumbent Board”) cease for any reason
to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent
to the Effective Date whose election, or nomination for election by the Company’s shareholders, was approved by a vote of
at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual was a member
of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result
of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than the Board;

 

(iii)                  
Consummation of a reorganization, merger, statutory share exchange or consolidation or similar transaction involving the
Company or any of its subsidiaries, a sale or other disposition of all or substantially all of the assets of the Company, or the
acquisition of assets or stock of another entity by the Company or any of its subsidiaries (each, a “Business Combination”),
in each case unless, following such Business Combination, (A) all or substantially all of the individuals and entities that were
the beneficial owners of the Outstanding Company Common Stock and the Outstanding Company Voting Securities immediately prior to
such Business Combination beneficially own, directly or indirectly, greater than 50% of the then-outstanding shares of common stock
(or, for a non-corporate entity, equivalent securities) and the combined voting power of the then-outstanding voting securities
entitled to vote generally in the election of directors (or, for a non-corporate entity, equivalent governing body), as the case
may be, of the entity resulting from such Business Combination (including, without limitation, an entity that, as a result of such
transaction, owns the Company or all or substantially all of the Company’s assets either directly or through one or more
subsidiaries) in substantially the same proportions as their ownership immediately prior to such Business Combination of the Outstanding
Company Common Stock and the Outstanding Company Voting Securities, as the case may be, (B) no Person (excluding any corporation
resulting from such Business Combination or any employee benefit plan (or related trust) of the Company or such corporation resulting
from such Business Combination) beneficially owns, directly or indirectly, 30% or more of, respectively, the then-outstanding shares
of common stock of the corporation resulting from such Business Combination or the combined voting power of the then-outstanding
voting securities of such corporation, except to the extent that such ownership existed prior to the Business Combination, and
(C) at least a majority of the members of the board of directors (or, for a non-corporate entity, equivalent governing body) of
the entity resulting from such Business Combination were members of the Incumbent Board at the time of the execution of the initial
agreement or of the action of the Board providing for such Business Combination; or

 

(iv)                  
Approval by the shareholders of the Company of a complete liquidation or dissolution of the Company.

 

Notwithstanding the foregoing, a Change in
Control shall not be deemed to occur solely because any person acquires beneficial ownership of more than 20% (30% with respect
to deferred compensation subject to Section 409A of the Code) of the Company Voting Securities as a result of the acquisition
of Company Voting Securities by the Company which reduces the number of Company Voting Securities outstanding; provided,
that if after such acquisition by the Company such person becomes the beneficial owner of additional Company Voting Securities
that increases the percentage of outstanding Company Voting Securities beneficially owned by such person, a Change in Control of
the Company shall then occur.

 

    	-17-

    	 

    

 

(v)              
     “Good Reason” shall mean (A) a material adverse change in the Participant’s authority, duties or responsibilities
as in effect immediately prior to the Change in Control; (B) a material reduction in the Participant’s base salary
or annual bonus opportunity, in each case as in effect immediately prior to the Change in Control; or (C) the reassignment of the
Participant’s place of employment to an office location more than 50 miles from the Participant’s then-current place
of employment.

 

(f)               
Notwithstanding the foregoing, if any Award is subject to Section 409A of the Code, this Section 10 shall be applicable
only to the extent specifically provided in the Award Agreement and permitted pursuant to Section 11(e). Nothing in this Section
10 shall preclude the Company from settling upon a Change in Control an Award if it is not replaced by a Replacement Award, to
the extent effectuated in accordance with Treas. Reg. § 1.409A-3(j)(ix).

 

		SECTION	11.           
Qualified Performance-Based Awards; Section 16(b); Section 409A

 

(a)               
The provisions of this Plan are intended to ensure that all Options and Stock Appreciation Rights granted hereunder to any
Participant who is or may be a “covered employee” (within the meaning of Section 162(m)(3) of the Code) in the
tax year in which such Option or Stock Appreciation Right is expected to be deductible to the Company qualify for the Section 162(m)
Exemption, and, unless otherwise determined by the Committee, all such Awards shall therefore be considered Qualified Performance-Based
Awards and this Plan shall be interpreted and operated consistent with that intention (including, without limitation, to require
that all such Awards be granted by a committee composed solely of members who satisfy the requirements for being “outside
directors” for purposes of the Section 162(m) Exemption (“Outside Directors”)). When granting any Award
other than an Option or Stock Appreciation Right, the Committee may designate such Award as a Qualified Performance-Based Award,
based upon a determination that (i) the recipient is or may be a “covered employee” (within the meaning of Section 162(m)(3)
of the Code) with respect to such Award, and (ii) the Committee wishes such Award to qualify for the Section 162(m) Exemption,
and the terms of any such Award (and of the grant thereof) shall be consistent with such designation (including, without limitation,
that all such Awards be granted by a committee composed solely of Outside Directors). To the extent required to comply with the
Section 162(m) Exemption, within 90 days after the commencement of a Performance Period or, if earlier, by the expiration of 25%
of a Performance Period, the Committee will designate one or more Performance Periods, determine the Participants for the Performance
Periods and establish the Performance Goals for the Performance Periods.

 

(b)              
Each Qualified Performance-Based Award (other than an Option or Stock Appreciation Right) shall be earned, vested and/or
payable (as applicable) upon the achievement of one or more Performance Goals, together with the satisfaction of any other conditions,
such as continued employment, as the Committee may determine to be appropriate.

 

(c)               
The full Board shall not be permitted to exercise authority granted to the Committee to the extent that the grant or exercise
of such authority would cause an Award designated as a Qualified Performance-Based Award not to qualify for, or to cease to qualify
for, the Section 162(m) Exemption.

 

    	-18-

    	 

    

 

(d)              
The provisions of this Plan are intended to ensure that no transaction under the Plan is subject to (and not exempt from)
the short-swing recovery rules of Section 16(b) of the Exchange Act (“Section 16(b)”). Accordingly, the composition
of the Committee shall be subject to such limitations as the Board deems appropriate to permit transactions pursuant to this Plan
to be exempt (pursuant to Rule 16b-3 promulgated under the Exchange Act) from Section 16(b), and no delegation of authority
by the Committee shall be permitted if such delegation would cause any such transaction to be subject to (and not exempt from)
Section 16(b).

 

(e)               
The Plan is intended to comply with the requirements of Section 409A of the Code or an exemption or exclusion therefrom
and, with respect to amounts that are subject to Section 409A of the Code, it is intended that the Plan be administered in all
respects in accordance with Section 409A of the Code. Each payment under any Award shall be treated as a separate payment for purposes
of Section 409A of the Code. In no event may a Participant, directly or indirectly, designate the calendar year of any payment
to be made under any Award. Notwithstanding any provision of the Plan or any Award Agreement to the contrary, in the event that
a Participant is a “specified employee” within the meaning of Section 409A of the Code (as determined in accordance
with the methodology established by the Company), amounts that constitute “nonqualified deferred compensation” within
the meaning of Section 409A of the Code that would otherwise be payable during the six-month period immediately following a Participant’s
“separation from service” within the meaning of Section 409A of the Code (“Separation from Service”) shall
instead be paid or provided on the first business day after the date that is six months following the Participant’s Separation
from Service. If the Participant dies following the Separation from Service and prior to the payment of any amounts delayed on
account of Section 409A of the Code, such amounts shall be paid to the personal representative of the Participant’s estate
within 30 days after the date of the Participant’s death.

 

		SECTION	12.           
Term, Amendment and Termination

 

(a)               
Effectiveness. The Plan was approved by the Board on March 19, 2013, subject to and contingent upon approval by at
least a majority of the outstanding shares of the Company. The Plan will be effective as of the date of such approval by the Company’s
shareholders (the “Effective Date”).

 

(b)              
Termination. The Plan will terminate on the tenth anniversary of the Effective Date. Awards outstanding as of such
date shall not be affected or impaired by the termination of the Plan.

 

(c)               
Amendment of Plan. The Board or the Committee may amend, alter, or discontinue the Plan, but no amendment, alteration
or discontinuation shall be made which would materially impair the rights of the Participant with respect to a previously granted
Award without such Participant’s consent, except such an amendment made to comply with applicable law, including without
limitation Section 409A of the Code, Applicable Exchange listing standards or accounting rules. In addition, no amendment
shall be made without the approval of the Company’s shareholders (a) to the extent such approval is required (1) by
applicable law or the listing standards of the Applicable Exchange as in effect as of the date hereof or (2) under applicable
law or the listing standards of the Applicable Exchange as may be required after the date hereof, (b) to the extent such amendment
would materially increase the benefits accruing to Participants under the Plan, (c) to the extent such amendment would materially
increase the number of securities which may be issued under the Plan or (d) to the extent such amendment would materially
modify the requirements for participation in the Plan.

 

    	-19-

    	 

    

 

(d)              
Amendment of Awards. Subject to Section 5(d), the Committee may unilaterally amend the terms of any Award theretofore
granted, but no such amendment shall cause a Qualified Performance-Based Award to cease to qualify for the Section 162(m)
Exemption or without the Participant’s consent materially impair the rights of any Participant with respect to an Award,
except such an amendment made to cause the Plan or Award to comply with applicable law, Applicable Exchange listing standards or
accounting rules.

 

		SECTION	13.           
Unfunded Status of Plan

 

It is presently intended that the Plan constitute
an “unfunded” plan for incentive and deferred compensation. The Committee may authorize the creation of trusts or other
arrangements to meet the obligations created under the Plan to deliver Common Stock or make payments; provided, however,
that unless the Committee otherwise determines, the existence of such trusts or other arrangements is consistent with the “unfunded”
status of the Plan.

 

		SECTION	14.           
General Provisions

 

(a)               
Conditions for Issuance. The Committee may require each person purchasing or receiving Shares pursuant to an Award
to represent to and agree with the Company in writing that such person is acquiring the Shares without a view to the distribution
thereof. The certificates for such Shares may include any legend which the Committee deems appropriate to reflect any restrictions
on transfer. Notwithstanding any other provision of the Plan or agreements made pursuant thereto, the Company shall not be required
to issue or deliver any certificate or certificates for Shares under the Plan prior to fulfillment of all of the following conditions:
(i) listing or approval for listing upon notice of issuance, of such Shares on the Applicable Exchange; (ii) any registration
or other qualification of such Shares of the Company under any state or federal law or regulation, or the maintaining in effect
of any such registration or other qualification which the Committee shall, in its absolute discretion upon the advice of counsel,
deem necessary or advisable; and (iii) obtaining any other consent, approval, or permit from any state or federal governmental
agency which the Committee shall, in its absolute discretion after receiving the advice of counsel, determine to be necessary or
advisable.

 

(b)              
Additional Compensation Arrangements. Nothing contained in the Plan shall prevent the Company or any Subsidiary or
Affiliate from adopting other or additional compensation arrangements for its employees.

 

(c)               
No Contract of Employment. The Plan shall not constitute a contract of employment, and adoption of the Plan shall
not confer upon any employee any right to continued employment, nor shall it interfere in any way with the right of the Company
or any Subsidiary or Affiliate to terminate the employment of any employee at any time.

 

    	-20-

    	 

    

 

(d)              
Required Taxes. No later than the date as of which an amount first becomes includible in the gross income of a Participant
for federal, state, local or foreign income or employment or other tax purposes with respect to any Award under the Plan, such
Participant shall pay to the Company, or make arrangements satisfactory to the Company regarding the payment of, any federal, state,
local or foreign taxes of any kind required by law to be withheld with respect to such amount. Unless otherwise determined by the
Company, withholding obligations may be settled with Common Stock, including Common Stock that is part of the Award that gives
rise to the withholding requirement, having a Fair Market Value on the date of withholding equal to the minimum amount (and not
any greater amount) required to be withheld for tax purposes, all in accordance with such procedures as the Committee establishes.
The obligations of the Company under the Plan shall be conditional on such payment or arrangements, and the Company and its Affiliates
shall, to the extent permitted by law, have the right to deduct any such taxes from any payment otherwise due to such Participant.
The Committee may establish such procedures as it deems appropriate, including making irrevocable elections, for the settlement
of withholding obligations with Common Stock.

 

(e)               
Designation of Death Beneficiary. The Committee shall establish such procedures as it deems appropriate for a Participant
to designate a beneficiary to whom any amounts payable in the event of such Participant’s death are to be paid or by whom
any rights of such eligible Individual, after such Participant’s death, may be exercised.

 

(f)               
Subsidiary Employees. In the case of a grant of an Award to any employee of a Subsidiary, the Company may, if the
Committee so directs, issue or transfer the Shares, if any, covered by the Award to the Subsidiary, for such lawful consideration
as the Committee may specify, upon the condition or understanding that the Subsidiary will transfer the Shares to the employee
in accordance with the terms of the Award specified by the Committee pursuant to the provisions of the Plan. All Shares underlying
Awards that are forfeited or canceled should revert to the Company.

 

(g)              
Governing Law and Interpretation. The Plan and all Awards made and actions taken thereunder shall be governed
by and construed in accordance with the laws of the State of North Carolina, without reference to principles of conflict of laws.
The captions of this Plan are not part of the provisions hereof and shall have no force or effect.

 

(h)              
Non-Transferability. Except as otherwise provided in Section 5(i) or by the Committee, Awards under the Plan
are not transferable except by will or by laws of descent and distribution.

 

(i)                
Deferrals. The Committee shall be authorized to establish procedures pursuant to which the payment of any Award may
be deferred. Subject to the provisions of this Plan and any Award Agreement, the recipient of an Award (including, without limitation,
any deferred Award) may, if so determined by the Committee, be entitled to receive, currently or on a deferred basis, interest
or dividends, or interest or (except with respect to Stock Options and Stock Appreciation Rights) dividend equivalents, with respect
to the number of shares covered by the Award, as determined by the Committee, in its sole discretion, and the Committee may provide
that such amounts (if any) shall be deemed to have been reinvested in additional Shares or otherwise reinvested. Notwithstanding
the foregoing, dividends and dividend equivalents with respect to performance-based Awards may not be paid until vesting (if any)
of such Awards, and the Committee shall not take or omit to take any action that would result in the imposition of penalty taxes
under Section 409A of the Code.

 

    	-21-

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