Document:

Exhibit 10.4 

 

Execution Copy

 

WELLS
FARGO BANK, NATIONAL ASSOCIATION

Master Servicer

 

and

 

PRINCIPAL
GLOBAL INVESTORS, LLC,

Sub-Servicer

 

SUB-SERVICING
AGREEMENT

 

Dated
as of August 1, 2015

 

Citigroup
Commercial Mortgage Securities Inc.,

Commercial Mortgage Pass-Through Certificates, Series 2015-P1

 

    	 

    	 

    

 

TABLE
OF CONTENTS

	 	 	 	 	 
	ARTICLE I	DEFINITIONS	 	1
	 	 	 	 
	Section
    1.01	 	Defined Terms	 	1
	 	 	 	 
	ARTICLE II	MASTER SERVICER’S
    ENGAGEMENT OF SUB-SERVICER TO PERFORM SERVICING RESPONSIBILITIES	 	2
	 	 	 	 
	Section
    2.01	 	Contract for Servicing; Possession
    of Loan Documents	 	2
	 	 	 	 	 
	ARTICLE III	SERVICING OF THE MORTGAGE
    LOANS	 	3
	 	 	 	 
	Section
    3.01	 	Sub-Servicer to Service	 	3
	 	 	 	 	 
	Section
    3.02	 	Merger or Consolidation of the Sub-Servicer	 	19
	 	 	 	 	 
	Section
    3.03	 	Limitation on Liability of the Sub-Servicer
    and Others	 	19
	 	 	 	 	 
	Section
    3.04	 	Sub-Servicer Resignation	 	20
	 	 	 	 	 
	Section
    3.05	 	No Transfer or Assignment of Servicing	 	20
	 	 	 	 	 
	Section
    3.06	 	Indemnification	 	21
	 	 	 	 	 
	ARTICLE IV	DEFAULT	 	21
	 	 	 	 
	Section
    4.01	 	Events of Default	 	21
	 	 	 	 	 
	Section
    4.02	 	Waiver of Defaults	 	24
	 	 	 	 	 
	Section
    4.03	 	Other Remedies of Master Servicer	 	24
	 	 	 	 	 
	ARTICLE V	TERMINATION	 	25
	 	 	 	 
	Section
    5.01	 	Termination	 	25
	 	 	 	 	 
	Section
    5.02	 	Termination With Cause	 	25
	 	 	 	 	 
	Section
    5.03	 	Reserved	 	25
	 	 	 	 	 
	Section
    5.04	 	Termination of Duties with Respect
    to Specially Serviced Loans	 	25
	 	 	 	 	 
	ARTICLE VI	MISCELLANEOUS	 	26
	 	 	 	 	 
	Section
    6.01	 	Successor to the Sub-Servicer	 	26
	 	 	 	 	 
	Section
    6.02	 	Financial Statements	 	26
	 	 	 	 	 
	Section
    6.03	 	Closing	 	26
	 	 	 	 	 
	Section
    6.04	 	Closing Documents	 	26
	 	 	 	 	 
	Section
    6.05	 	Notices	 	27
	 	 	 	 	 
	Section
    6.06	 	Severability Clause	 	27
	 	 	 	 	 
	Section
    6.07	 	Counterparts	 	28
	 	 	 	 	 	 
	 Section 6.08	 	Governing Law	 	 28

 

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	Section 6.09	 	Protection of Confidential Information	 	28
	 	 	 	 	 
	Section 6.10	 	Intention of the Parties	 	29
	 	 	 	 	 
	Section 6.11	 	Third Party Beneficiary	 	29
	 	 	 	 	 
	Section 6.12	 	Successors and Assigns; Assignment of Agreement	 	29
	 	 	 	 	 
	Section 6.13	 	Waivers	 	29
	 	 	 	 	 
	Section 6.14	 	Exhibits	 	29
	 	 	 	 	 
	Section 6.15	 	General Interpretive Principles	 	30
	 	 	 	 	 
	Section 6.16	 	Complete Agreement	 	30
	 	 	 	 	 
	Section 6.17	 	Further Agreement	 	30
	 	 	 	 	 
	Section 6.18	 	Amendments	 	30

 

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	EXHIBIT A	 	MORTGAGE LOAN SCHEDULE	 	A-1
	EXHIBIT B	 	[RESERVED]	 	B-1
	EXHIBIT C	 	POOLING AND SERVICING AGREEMENT	 	C-1
	EXHIBIT D	 	[RESERVED]	 	D-1
	EXHIBIT E	 	QUARTERLY SERVICING CERTIFICATION	 	E-1
	EXHIBIT F	 	FORM OF ACCOUNT CERTIFICATION	 	F-1
	EXHIBIT G	 	FORM OF COLLECTION REPORT	 	G-1
	EXHIBIT H	 	FORM OF CERTIFICATE OF INSURANCE	 	H-1
	EXHIBIT I	 	NEW LEASE INFORMATION	 	I-1
	EXHIBIT J	 	QUARTERLY  ACCOUNTS CERTIFICATION	 	J-1
	EXHIBIT K	 	FORM NOTE REGISTER	 	K-1

 

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This
is a Sub-Servicing Agreement (the “Agreement”), dated as of August 1, 2015, by and between PRINCIPAL GLOBAL
INVESTORS, LLC, a limited liability company having an office at 801 Grand Avenue, Des Moines, Iowa 50392-1450, and its successors
and assigns (the “Sub-Servicer”), and WELLS FARGO BANK, NATIONAL ASSOCIATION, having an office at MAC D1086,
550 South Tryon Street, 14th Floor, Charlotte, North Carolina 28202, and its successors and assigns (the “Master
Servicer”).

 

W
I T N E S S E T H:

 

WHEREAS,
Citigroup Commercial Mortgage Securities Inc. (the “Depositor”), the Master Servicer, as Master Servicer, LNR
Partners, LLC, as special servicer (the “Special Servicer”), Park Bridge Lender Services LLC, as operating
advisor (the “Operating Advisor”), Citibank, N.A., as certificate administrator (the “Certificate
Administrator”), Deutsche Bank Trust Company Americas, as trustee (the “Trustee”), and Wells Fargo
Bank, National Association, as custodian (the “Custodian”), have entered into that certain Pooling and Servicing
Agreement dated as of August 1, 2015, as amended, modified and restated from time to time (the “Pooling and Servicing
Agreement”), whereby the Master Servicer shall master service certain mortgage loans on behalf of the Trustee; and

 

WHEREAS,
the Master Servicer desires to enter into a contract with the Sub-Servicer whereby the Sub-Servicer shall service the mortgage
loan or mortgage loans, as applicable, listed on Exhibit A (the “Mortgage Loan Schedule”) attached
hereto (hereinafter referred to as the “Mortgage Loans”) on behalf of the Master Servicer.

 

NOW,
THEREFORE, in consideration of the mutual agreements hereinafter set forth, and for other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the Master Servicer and the Sub-Servicer hereby agree as follows:

 

ARTICLE
I

DEFINITIONS

 

Section
1.01     Defined Terms.

 

Unless
otherwise specified in this Agreement, all capitalized terms not otherwise defined herein shall have the meanings set forth in
the Pooling and Servicing Agreement. As used herein, the following terms have the meanings assigned to them in this Section
1.01:

 

“Available
Distribution Amount” shall mean, with respect to any date, an amount equal to, without duplication, (a) the sum of (i)
the aggregate of the amounts on deposit in the Sub-Servicer Collection Account as of such date, (ii) the aggregate of all other
amounts received with respect to the Mortgage Loans as of such date to the extent not previously remitted to the Master Servicer
and (iii) the aggregate amount of Prepayment Interest Shortfalls deposited by the Sub-Servicer in the Sub-Servicer Collection
Account as required by Section 3.13 of the Pooling and Servicing Agreement as incorporated herein pursuant to Section
3.01(c)(19) of this Agreement, to the extent not previously remitted to the Master Servicer, net of (b) the portion of
the amount described in subclause (a) of this definition that represents one or more of the following: (i) Escrow Payments (other
than Escrow Payments that are to be used to reimburse the Master

 

    	 

    	 

    

 

Servicer for Property Advances) or (ii) any amounts that the
Sub-Servicer is entitled to retain as compensation pursuant to Section 3.12 of the Pooling and Servicing Agreement
as incorporated herein pursuant to Section 3.01(c)(17) of this Agreement.

 

“Collection
Report” shall mean the monthly report prepared by the Sub-Servicer setting forth, with respect to the Mortgage Loans,
the information described on Exhibit G attached hereto.

 

“Mortgage
Loans” shall have the meaning specified in the recitals hereto.

 

“Mortgage
Loan Schedule” shall have the meaning specified in the recitals hereto.

 

“Sub-Servicer
Collection Account” shall have the meaning specified in Section 3.01(c)(8) of this Agreement.

 

“Sub-Servicer
Remittance Date” shall mean the first Business Day after each Determination Date.

 

“Sub-Servicing
Fee” shall mean, with respect to each Mortgage Loan, the fee payable to the Sub-Servicer pursuant to Section 3.01(c)(17)
of this Agreement.

 

“Sub-Servicing
Fee Rate” shall mean, with respect to each Mortgage Loan, the rate that corresponds to such Mortgage Loan set forth
on Exhibit A hereto under the heading “Sub-Servicing Fee %.”

 

“Task
List” shall mean the task list attached hereto as Exhibit L.

 

ARTICLE
II

MASTER SERVICER’S ENGAGEMENT OF SUB-SERVICER

TO PERFORM SERVICING RESPONSIBILITIES

 

Section
2.01     Contract for Servicing; Possession of Loan Documents.

 

The
Master Servicer, by execution and delivery of this Agreement, does hereby contract with the Sub-Servicer, subject to the terms
of this Agreement, for the servicing of the Mortgage Loans. On and after the Closing Date, the Sub-Servicer shall hold any portion
of the Servicing File or the Mortgage File (including without limitation, any original letter of credit) in the possession of
the Sub-Servicer in trust by the Sub-Servicer, on behalf of the Master Servicer for the benefit of the Trustee. The Sub-Servicer’s
possession of any portion of the Servicing File or the Mortgage File shall be at the will of the Master Servicer and the Trustee
for the sole purpose of facilitating the servicing or the supervision of servicing of the Mortgage Loans pursuant to this Agreement,
and such retention and possession by the Sub-Servicer shall be in a custodial capacity only. Any portion of the Servicing File
or the Mortgage File retained by the Sub-Servicer shall be identified to reflect clearly the ownership of the Mortgage Loans by
the Trustee. The Sub-Servicer shall release from its custody any Mortgage File retained by it only in accordance with this Agreement
and, to the extent incorporated herein, the Pooling and Servicing Agreement. Within 20 days following the Closing Date the Sub-Servicer
shall provide to the

 

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Master Servicer a certification executed by a duly authorized officer of the Sub-Servicer, certifying to
the Master Servicer as to the original letters of credit held by the Sub-Servicer and identifying the letters of credit, the amounts
of the letters of credit and the Mortgage Loans to which they relate. The Sub-Servicer shall provide to the Master Servicer as
soon as practicable after request therefor by the Master Servicer a copy of any documents held by it with respect to the Mortgage
Loans. Upon request, without limiting any obligation in any other provision in this Agreement, during the term of this Agreement,
the Sub-Servicer will also provide to the Master Servicer copies of any lease, amendments and other documents related to the Mortgaged
Properties securing any Mortgage Loan or related to any Mortgage Loan.

 

ARTICLE
III

SERVICING OF THE MORTGAGE LOANS

 

Section
3.01Sub-Servicer to Service.

 

(a)          The
Sub-Servicer, as an independent contractor, shall service and administer the Mortgage Loans in a manner consistent with the Servicing
Standard under the Pooling and Servicing Agreement.

 

(b)          The
Sub-Servicer shall perform, on behalf of the Master Servicer, all of the obligations of the Master Servicer (with respect to the
Mortgage Loans subject to this Agreement) as set forth in those sections of the Pooling and Servicing Agreement specifically incorporated
herein pursuant to Section 3.01(c) of this Agreement (the “Incorporated Sections”), as modified
by Section 3.01(c) of this Agreement, and the Master Servicer shall have the same rights with respect to the Sub-Servicer
that the Trustee, the Certificate Administrator, the Custodian, the Depositor, the Underwriters, the Initial Purchasers, the Controlling
Class Certificateholder, the Directing Holder, the Operating Advisor, the Rating Agencies, the Rule 17g-5 Information Provider,
the Certificateholders, the Controlling Class Representative and the Special Servicer (including, without limitation, the right
of the Special Servicer to direct the Master Servicer during certain periods) have with respect to the Master Servicer under the
Pooling and Servicing Agreement to the extent that the Sub-Servicer is acting on behalf of the Master Servicer hereunder and except
as otherwise set forth herein. Without limiting the foregoing, and subject to Section 3.22 of the Pooling and Servicing
Agreement as modified herein, the Sub-Servicer shall service and administer each Mortgage Loan as long as it is not a Specially
Serviced Loan; provided, however, that the Sub-Servicer shall continue to receive payments (and provide notice to the Master Servicer
of such payments), collect information and prepare all reports to the Trustee required from the Master Servicer under the Pooling
and Servicing Agreement with respect to any Specially Serviced Loan, and further to render such incidental services with respect
to any Specially Serviced Loan as are specifically provided for therein; provided, further, however, that the Sub-Servicer shall
continue to be entitled to its Sub-Servicing Fee with respect to any such Specially Serviced Loan in accordance with and to the
extent provided for in Section 3.01(c)(17) of this Agreement. All references herein to the respective duties
of the Sub-Servicer and the Special Servicer, and to the areas in which they may exercise discretion, shall be subject to Section
3.22 of the Pooling and Servicing Agreement, as modified herein and to the Special Servicer’s rights to service
a Specially Serviced Loan. Except as otherwise set forth below, for purposes of this Agreement, (i)

 

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references to the Trustee,
the Certificate Administrator, the Custodian, the Depositor, the Underwriters, the Initial Purchasers, the Controlling Class Certificateholder,
the Directing Holder, the Operating Advisor, the Rating Agencies, the Rule 17g-5 Information Provider, the Certificateholders,
the Controlling Class Representative and the Special Servicer in the Incorporated Sections (and in the defined terms used therein)
shall be deemed to be references to the Master Servicer hereunder, (ii) references to the Master Servicer in the Incorporated
Sections (and in the defined terms used therein) shall be deemed to be references to the Sub-Servicer hereunder, (iii) references
to the Mortgage Loans, as defined in the Pooling and Servicing Agreement, in the Incorporated Sections (and in the defined terms
used therein) shall be deemed to be references to the Mortgage Loans as defined herein, and (iv) references to the Pooling and
Servicing Agreement in the Incorporated Sections (and in the defined terms used therein) shall be deemed to be references to this
Agreement (such modifications of the Incorporated Sections (and in the defined terms used therein) pursuant to clauses (i) through
(iv) shall be referred to herein as the “References Modification”). In each case where the Master Servicer
is given any power to act under the provisions of the Incorporated Sections, such power is hereby delegated to the Sub-Servicer
to the extent necessary to perform its obligations under this Agreement. The Sub-Servicer shall have no duties or obligations
with respect to any Serviced Loan Combination or Serviced Companion Loan. The Sub-Servicer shall perform the duties and obligations
allocated to the Sub-Servicer as reflected on the Task List. To the extent of any conflict or inconsistency between the Task List
and this Agreement (other than the Task List), this Agreement shall control.

 

Without
limiting the generality of the foregoing, with respect to any requirement in an Incorporated Section for the Master Servicer to
provide notices or documents to, or otherwise communicate with, any other party to the Pooling and Servicing Agreement, it is
the intent of the parties hereto that, except as required by Article XI of the Pooling and Servicing Agreement as incorporated
herein and except as specified in Section 3.01(c)(26) of this Agreement, the Sub-Servicer provide such notices or
documents to, or otherwise communicate with, the Master Servicer, and the Master Servicer provide such notices or documents to,
or otherwise communicate with, the other party or parties to the Pooling and Servicing Agreement.

 

(c)          The
following Sections of the Pooling and Servicing Agreement, unless otherwise provided in this Section 3.01(c) of
this Agreement, are hereby incorporated herein by reference as if fully set forth herein, and, for purposes of this Agreement,
in addition to the References Modification, are hereby further modified as set forth below:

 

(1)          Section
2.03(a). Promptly after receipt thereof from the Depositor, the Master Servicer shall provide a copy of the PCC Loan Purchase
Agreement to the Sub-Servicer. The Sub-Servicer shall notify the Master Servicer in writing within five (5) Business Days after
the Sub-Servicer discovers or receives notice alleging a Document Defect or a Breach or receives a Repurchase Communication of
a Repurchase Request, Repurchase Request Withdrawal, Repurchase or Repurchase Request Rejection. The Sub-Servicer shall promptly
provide to the Master Servicer a copy of any written Repurchase Request, Repurchase Request Withdrawal, Repurchase or Repurchase
Request Rejection received by the Sub-Servicer and such other information in the possession of the Sub-Servicer reasonably requested
by the Master Servicer to fulfill its obligations under Section 2.03(a) of the Pooling and Servicing Agreement.

 

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(2)          Section
2.05. Section 2.05(a)(i) of the Pooling and Servicing Agreement shall be deemed modified to read “The
Sub-Servicer is a limited liability company, duly organized, validly existing and in good standing under the laws of the State
of Delaware, and the Sub-Servicer is in compliance with the laws of each jurisdiction in which a Mortgaged Property is located
to the extent necessary to perform its obligations under this Agreement.”

 

(3)          Sections
3.01(a) and (b) are incorporated herein, except where expressly provided otherwise in this Agreement. Without limiting the
generality of the foregoing, the Sub-Servicer shall take all necessary action to continue all UCC financing statements prior to
the expiration of such UCC financing statements. The Master Servicer shall forward the Sub-Servicer recorded UCC financing statements
reflecting the Trust as the secured party. The Sub-Servicer shall not modify, amend, waive or otherwise consent to any change
of the terms of any Mortgage Loan except as allowed by this Agreement.

 

(4)          Sections
3.01(c) and (d). References to the Master Servicer shall not be deemed to be references to the Sub-Servicer for purposes of
Sections 3.01(c) and (d) of the Pooling and Servicing Agreement. Each and every one of the terms and conditions
of Sections 3.01(c) and (d) of the Pooling and Servicing Agreement shall be enforceable against the Sub-Servicer
in accordance with the terms thereof. The Sub-Servicer may not enter into any new Sub-Servicing Agreements in connection with
the Mortgage Loans and shall directly service the Mortgage Loans in accordance with the terms and conditions of this Agreement.
The Sub-Servicer may delegate certain non-material and non-cashiering servicing duties hereunder (such as inspections or insurance
monitoring) to contractors, vendors, other third parties or an Affiliate; provided, however, that (a) the Sub-Servicer shall remain
responsible for the actions of such third-party contractors, vendors, other third parties or Affiliate as if it were alone performing
such functions and shall pay all fees and expenses of such third-party contractors, vendors, other third parties or Affiliate,
and (b) the related agreements or arrangements are (or may be required to be), to the extent of the functions to be performed
by such contractors, vendors, other third parties or Affiliate, consistent with the applicable requirements of the Pooling and
Servicing Agreement. This Agreement may be assumed by the Trustee, if the Trustee has assumed the duties of the Master Servicer
or by any successor Master Servicer without cost or obligation to the assuming party or the Trust Fund, upon the assumption by
such party of the obligations of the Master Servicer pursuant to Section 7.02 of the Pooling and Servicing Agreement.
Section 3.01(k) of the Pooling and Servicing Agreement is not incorporated herein. To the extent a Note register is required
under any Loan Documents, the Sub-Servicer shall promptly provide to the Master Servicer any updates regarding the applicable
Notes in the form of Exhibit K attached hereto.

 

(5)          Section
3.03. The determination as to the application of amounts collected in respect of each Mortgage Loan, to the extent the application
is not governed by the express provisions of the related Note or Mortgage, shall be made by the Master Servicer, and so directed
to the Sub-Servicer in writing. Without the express written consent of the Master Servicer, the Sub-Servicer shall not waive any
Penalty Charges in connection with any delinquent Monthly Payment with respect to any Mortgage Loan. The Sub-Servicer shall use
reasonable efforts to collect and shall forward to the Master Servicer all

 

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income statements, rent rolls and other reporting information
(as required under the related Loan Documents) collected by the Sub-Servicer from Mortgagors within the timeframe set forth in
Section 3.01(c)(29) of this Agreement.

 

(6)          Section
3.04(a). Without limiting the generality of the obligations of the Sub-Servicer hereunder, the Sub-Servicer shall monitor
and certify the information on each Mortgage Loan with respect to taxes, insurance premiums, assessments, ground rents and other
similar items on a quarterly basis starting for the quarter ending in September of 2015 (provided that the first such certification
shall cover the period from the Closing Date to the end of such quarter) within thirty (30) days of the end of such quarter as
required by, and in the form of, Exhibit E attached hereto, pursuant to Section 3.01(c)(29)
of this Agreement. The third, fourth, fifth and sixth sentences of Section 3.04(a) of the Pooling and Servicing
Agreement are not incorporated herein. The Sub-Servicer shall not be obligated to make any Property Advances. With respect to
non-escrowed payments, when the Sub-Servicer becomes aware in accordance with the Servicing Standard that a Mortgagor has failed
to make any such payment or, with respect to escrowed loans, collections from a Mortgagor are insufficient to pay any such item
before the applicable penalty or termination date, the Sub-Servicer shall promptly notify the Master Servicer. The Master Servicer
may direct the Sub-Servicer in writing to (and upon such direction, the Sub-Servicer shall) make a payment from amounts on deposit
in the Sub-Servicer Collection Account as contemplated by Section 3.04(a) of the Pooling and Servicing Agreement.

 

(7)          Section
3.04(b), (c) and (d). The creation of any Escrow Account shall be evidenced by a certification in the form of Exhibit
F attached hereto and a copy of such certification shall be furnished to the Master Servicer on or prior to the Closing
Date and thereafter to the Master Servicer upon any transfer of any Escrow Account. Without the express written consent of the
Master Servicer, the Sub-Servicer shall not (a) waive or extend the date set forth in any agreement governing reserve funds by
which the required repairs and/or capital improvements at the related Mortgaged Property must be completed or (b) release any
earn out reserve funds or return any related letters of credit delivered in lieu of earn out reserve funds; provided that the
Sub-Servicer may grant such a waiver or perform such release or return without the consent of the Master Servicer if such waiver,
release or return, as the case may be, is not a Major Decision or a Special Servicer Decision. The Sub-Servicer shall promptly
notify the Master Servicer of any failure by a Mortgagor described in Section 3.04(d) of the Pooling and Servicing
Agreement. References to the Collection Account shall be references to the Sub-Servicer Collection Account.

 

(8)          Section
3.05(a). The Sub-Servicer shall establish a collection account (hereinafter the “Sub-Servicer Collection Account”),
meeting all of the requirements of the Collection Account, and references to the Collection Account shall be references to such
Sub-Servicer Collection Account. The creation of any Sub-Servicer Collection Account shall be evidenced by a certification in
the form of Exhibit F attached hereto and a copy of such certification shall be furnished to the Master Servicer
on or prior to the Closing Date and thereafter to the Master Servicer upon any transfer of the Sub-Servicer Collection Account.
Notwithstanding the last two paragraphs of Section 3.05(a)

 

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of the Pooling and Servicing Agreement, the Sub-Servicer
shall deposit into the Sub-Servicer Collection Account and include in its Available Distribution Amount, Ancillary Fees, Consent
Fees, Excess Modification Fees, Assumption Fees, assumption application fees and defeasance fees collected by the Sub-Servicer,
to the extent the Sub-Servicer is not entitled to such amounts pursuant to Section 3.01(c)(17) of this Agreement.
The last paragraph of Section 3.05(a) of the Pooling and Servicing Agreement is not incorporated herein. If any
check or other form of payment received by the Sub-Servicer with respect to a Mortgage Loan is returned for insufficient funds
and the Sub-Servicer has previously remitted cash in the amount of such payment to the Master Servicer, the Master Servicer shall
reimburse the Sub-Servicer for such amount within three (3) Business Days after the Master Servicer receives notification from
the Sub-Servicer of such insufficient funds.

 

(9)           Section
3.06 is not incorporated herein. The Sub-Servicer may, from time to time, make withdrawals from the Sub-Servicer Collection
Account for any of the following purposes (the order set forth below not constituting an order of priority for such withdrawals):

 

(i)         to
remit to the Master Servicer for deposit in the Collection Account the amounts required to be so deposited pursuant to Section
4.06(a)(i), (ii) and (v) of the Pooling and Servicing Agreement and Section 3.01(c)(30)
of this Agreement;

 

(ii)        to
the extent not otherwise required to be applied to Prepayment Interest Shortfalls, to pay to itself earned and unpaid Sub-Servicing
Fees in respect of the Mortgage Loans, the Sub-Servicer’s right to payment of its Sub-Servicing Fee pursuant to this clause
(ii) with respect to any Mortgage Loan being limited to amounts received on or in respect of such Mortgage Loan (whether in the
form of payments, Liquidation Proceeds, Insurance Proceeds or Condemnation Proceeds) that are allocable as a recovery of interest
thereon; and

 

(iii)       to
the extent not reimbursed or paid pursuant to any other clause of this Section 3.01(c)(9), to pay the Sub-Servicer unpaid Sub-Servicing
Fees (but only if the related Mortgage Loan has been liquidated or a Final Recovery Determination has been made with respect thereto);

 

(iv)        to
pay to itself, as additional servicing compensation in accordance with Section 3.12(a) of the Pooling and Servicing
Agreement, interest and investment income earned in respect of amounts held in the Sub-Servicer Collection Account as provided
in Section 3.01(c)(10) of this Agreement (but only to the extent of the net investment earnings with respect to
the Sub-Servicer Collection Account for the period from and including the prior Sub-Servicer Remittance Date to and including
such Sub-Servicer Remittance Date);

 

(v)         to
pay itself, any amounts payable pursuant to Section 6.03, of the Pooling and Servicing Agreement, but only to the extent allowed
by the Pooling and Servicing Agreement and Section 3.03 of this Agreement;

 

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(vi)        to
clear and terminate the Sub-Servicer Collection Account at the termination of this Agreement pursuant to Section 9.01
of the Pooling and Servicing Agreement, as modified herein; and

 

(vii)       any
amounts deposited in the Sub-Servicer Collection Account in error.

 

            The
Sub-Servicer shall keep and maintain separate accounting records, on a loan-by-loan basis and on a property-by-property basis
when appropriate, for the purpose of justifying any withdrawal, debit or credit from its Sub-Servicer Collection Account. On each
Sub-Servicer Remittance Date, all income and gain realized from investment of funds to which the Sub-Servicer is entitled shall
be subject to withdrawal by such Sub-Servicer. The last paragraph of Section 3.06(a) of the Pooling and Servicing
Agreement is incorporated herein.

  

(10)         Section
3.07 is not incorporated herein. The Sub-Servicer may invest funds in the Sub-Servicer Collection Account and any Escrow
Account maintained by the Sub-Servicer on the same terms as the Master Servicer may invest funds in the Collection Account and
any Escrow Account, and subject to the same restrictions and obligations regarding maturity dates, gains, losses, possession of
Permitted Investments and Permitted Investments payable on demand. Without limiting the generality of the foregoing, (A) any investment
of funds in the Sub-Servicer Collection Account shall be made in the name of the Certificate Administrator, on behalf of the Trustee
for the benefit of the Certificateholders or in the name of a nominee of the Certificate Administrator and (B) the Sub-Servicer,
on behalf of the Trustee, shall take the actions described in Section 3.07 of the Pooling and Servicing Agreement
as applicable to the Master Servicer necessary to perfect the Trustee’s interest in Permitted Investments. The Sub-Servicer
shall have no responsibility or liability with respect to the investment direction of the Master Servicer, the Certificate Administrator,
the Special Servicer, any Mortgagor or Manager or any losses resulting therefrom, whether from Permitted Investments or otherwise.
The Sub-Servicer shall not be required to deposit any loss on an investment of funds in an Investment Account if such loss is
incurred solely as a result of the insolvency of the federal or state chartered depository institution or trust company that holds
such Investment Account, so long as such depository institution or trust company is not the Sub-Servicer or an Affiliate of the
Sub-Servicer and satisfied the qualifications set forth in the definition of Eligible Account both (1) at the time such investment
was made and (2) as of the date that is thirty (30) days prior to the insolvency.

 

(11)         Section
3.08(a). References to the Collection Account shall be references to the Sub-Servicer Collection Account. Within thirty (30)
days after the Closing Date, the Sub-Servicer shall forward to the Master Servicer, for the Mortgage Loans, a fully completed
certificate of insurance in the form of Exhibit H attached hereto. The Sub-Servicer shall promptly notify the Master
Servicer of any Mortgaged Property that is not insured against terrorist or other similar acts. Upon receipt of notice from the
Special Servicer of any determination by the Special Servicer that a default is an Acceptable Insurance Default, the Master Servicer
shall notify the Sub-Servicer of such determination.

 

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(12)        Section
3.08(b). References to the Collection Account shall be references to the Sub-Servicer Collection Account.

 

(13)        Section
3.08(c). The Sub-Servicer may self insure for the fidelity bond and errors omission insurance required under this Section
3.01(c)(13) under the terms and conditions applicable to the Master Servicer under Section 3.08(c) of the Pooling and
Servicing Agreement.

 

(14)        Section
3.09. With respect to any assumption, transfer or other action contemplated by Section 3.09(a) of the Pooling
and Servicing Agreement, the Sub-Servicer shall perform the obligations of the Master Servicer under Section 3.09
of the Pooling and Servicing Agreement (including dealing directly with the Special Servicer on matters for which the Pooling
and Servicing Agreement requires the Master Servicer to deal with the Special Servicer) without the approval of the Master Servicer,
but subject to all requirements and restrictions set forth in Section 3.09 of the Pooling and Servicing Agreement;
provided, however, that the Sub-Servicer shall copy the Master Servicer on all correspondence to the Special Servicer regarding
such matters and the Sub-Servicer shall prepare any package and analysis necessary to obtain any required Rating Agency Confirmation
and forward such package to the Master Servicer for the Master Servicer to deal with the Rating Agencies. For avoidance of doubt,
the Sub-Servicer shall not approve or consent to any assumption, transfer or other action contemplated by Section 3.09(a)
of the Pooling and Servicing Agreement without the consent of the Special Servicer. With respect to any defeasance contemplated
by Section 3.09(d) of the Pooling and Servicing Agreement, the Sub-Servicer shall perform the obligations of the
Master Servicer under Section 3.09(d) of the Pooling and Servicing Agreement, but subject to all requirements and
restrictions set forth in Section 3.09(d) of the Pooling and Servicing Agreement. For the avoidance of doubt, the
Sub-Servicer will not process any defeasance contemplated by Section 3.09(d) of the Pooling and Servicing Agreement
without the prior written consent of the Master Servicer. With respect to any such defeasance, the Sub-Servicer shall deliver
to the Master Servicer (not the Rating Agencies) a certification substantially in the form attached to the Pooling and Servicing
Agreement as Exhibit DD prior to the Master Servicer’s delivery of such a certification to the Rating Agencies.
With respect to any matter or action requiring Rating Agency Confirmation, the Sub-Servicer shall prepare any package and analysis
necessary to obtain such required Rating Agency Confirmation and forward such package to the Master Servicer for the Master Servicer
to deal with the Rating Agencies.

 

(15)        Reserved.

 

(16)        Section
3.11. The references to the Collection Account shall be references to the Sub-Servicer Collection Account. No expense incurred
in connection with any instrument of satisfaction or deed of reconveyance shall be chargeable to the Sub-Servicer Collection Account.

 

(17)        Section
3.12(a). References to the Servicing Fee shall be deemed to be references to the Sub-Servicing Fee and references to the Servicing
Fee Rate shall be deemed to be references to the Sub-Servicing Fee Rate. All references to the Collection

 

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Account shall be references
to the Sub-Servicer Collection Account. The Sub-Servicer shall be entitled to retain, and shall not be required to deposit in
the Sub-Servicer Collection Account, additional servicing compensation in the form of the following amounts to the extent collected
from the Mortgagor: (i) 80% of that portion of Excess Modification Fees to which the Master Servicer is entitled under Section
3.12(a) of the Pooling and Servicing Agreement collected by the Sub-Servicer in connection with matters performed by the
Sub-Servicer pursuant to Section 3.01(c)(26) of this Agreement, (ii) 100% of that portion of defeasance fees to
which the Master Servicer is entitled under Section 3.12(a) of the Pooling and Servicing Agreement collected by
the Sub-Servicer in connection with matters performed by the Sub-Servicer pursuant to Section 3.01(c)(14) of this
Agreement, (iii) 80% of that portion of Assumption Fees to which the Master Servicer is entitled under Section 3.12(a)
of the Pooling and Servicing Agreement collected by the Sub-Servicer in connection with matters performed by the Sub-Servicer
pursuant to Section 3.01(c)(14) of this Agreement, (iv) 100% of that portion of assumption application fees to which
the Master Servicer is entitled under Section 3.12(a) of the Pooling and Servicing Agreement collected by the Sub-Servicer
in connection with matters performed by the Sub-Servicer pursuant to Section 3.01(c)(14) of this Agreement, (v)
Prepayment Interest Excesses arising from any principal prepayments on the Mortgage Loans to the extent not required by Section
3.13 of the Pooling and Servicing Agreement to offset Prepayment Interest Shortfalls on all Mortgage Loans (as defined
in the Pooling and Servicing Agreement), and (vi) 80% of that portion of waiver fees, earnout fees, Consent Fees and other processing
fees to which the Master Servicer is entitled under Section 3.12(a) of the Pooling and Servicing Agreement collected
by the Sub-Servicer in connection with matters performed by the Sub-Servicer pursuant to Section 3.01(c)(26) of
this Agreement. The Sub-Servicer shall be entitled to (a) interest or other income earned on deposits relating to the Trust Fund
in the Sub-Servicer Collection Account in accordance with Section 3.01(c)(10) of this Agreement, (b) interest or
other income earned on deposits in any Escrow Account maintained by the Sub-Servicer which are not required by applicable law
or the Loan Documents to be paid to the Mortgagor, (c) 100% of any charges for processing Mortgagor requests (other than requests
for actions otherwise addressed in this Section 3.01(c)(17)) processed by the Sub-Servicer for which the consent
of the Master Servicer is not required under this Agreement, (d) 50% of any charges for processing Mortgagor requests (other than
requests for actions otherwise addressed in this Section 3.01(c)(17)) processed by the Sub-Servicer for which the
consent of the Master Servicer is required under this Agreement, and (e) 100% of Ancillary Fees actually received from Mortgagors
on Performing Mortgage Loans in the case of servicing actions processed by the Sub-Servicer, in each case only to the extent actually
paid by the Mortgagor. Notwithstanding the foregoing, the Sub-Servicer shall not be entitled to any Penalty Charges or any other
additional servicing compensation not specifically addressed in this Section 3.01(c)(17).

 

(18)        Section
3.12(d) and (e).

 

(19)        Section
3.13. On each Sub-Servicer Remittance Date, the Sub-Servicer shall deposit into the Sub-Servicer Collection Account as part
of the Sub-Servicer Remittance Amount, the amount set forth in Section 3.13 of the Pooling and Servicing Agreement
to the extent resulting from Principal Prepayments on the Mortgage Loans

 

    	10

    	 

    

 

and to the extent that the Master Servicer is required
to remit such amounts under Section 3.13 of the Pooling and Servicing Agreement. Notwithstanding the foregoing,
the Sub-Servicer shall have no obligation to deposit any amount set forth in the preceding sentence for Specially Serviced Loans
or Mortgage Loans on which the Master Servicer allowed or consented to the Sub-Servicer allowing a Principal Prepayment on a date
other than the applicable Due Date. References to the Servicing Fee shall be references to the Sub-Servicing Fee.

 

(20)        Section
3.15. For the avoidance of doubt, access provided by the Sub-Servicer pursuant to Section 3.15 of the Pooling
and Servicing Agreement shall only be provided to the Master Servicer.

 

(21)        Section
3.18(a) and (b). The Sub-Servicer shall promptly (but, in the case of inspections, in no event later than the earlier of (i)
thirty (30) days after completion and receipt of such inspection report and (ii) December 15th of each year) forward
to the Master Servicer a copy of all such reports prepared by the Sub-Servicer. If any inspection report identifies a “life
safety” or other material deferred maintenance item existing with respect to any Mortgaged Property, the Sub-Servicer (x)
shall promptly send to the related Mortgagor a letter identifying such deferred maintenance item and instructing the related Mortgagor
to correct such deferred maintenance item and (y) shall notify the Master Servicer (by email to cmsins@wellsfargo.com) upon resolution
of such “life safety” or deferred maintenance item. With respect to the Mortgage Loans serviced hereunder, the Sub-Servicer
shall inform each ground lessor that any notices of default under the related Ground Lease should thereafter be forwarded to the
Master Servicer in addition to the Sub-Servicer.

 

(22)        Section
3.19.

 

(23)        Section
3.20 is not incorporated herein. The Sub-Servicer shall have no obligation to make any Property Advances, provided, that the
Sub-Servicer shall provide the Master Servicer not less than five (5) Business Days’ notice before the date on which the
Master Servicer is required to make any Property Advance with respect to any Mortgage Loan (which notice shall include any and
all information in its possession reasonably requested by the Master Servicer that will enable the Master Servicer to determine
whether such Property Advance would constitute a Nonrecoverable Property Advance).

 

(24)        Section
3.22(a). The Sub-Servicer shall promptly notify the Master Servicer of any event or circumstance that the Sub-Servicer deems
to constitute a Servicing Transfer Event with respect to any Mortgage Loan. The determination as to whether a Servicing Transfer
Event has occurred shall be made by the Master Servicer. The Master Servicer shall promptly notify the Sub-Servicer of any determination
by the Master Servicer that a Servicing Transfer Event with respect to any Mortgage Loan has occurred. Upon receipt by the Master
Servicer of notice from the Special Servicer that a Specially Serviced Loan has become a Corrected Loan, the Master Servicer shall
promptly give the Sub-Servicer notice thereof and the obligation of the Sub-Servicer to service and administer such Mortgage Loan
shall resume.

 

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(25)        Section
3.22(c).

 

(26)        Section
3.24 With respect to any modification, extension, waiver, consent or other action contemplated by Section 3.24
of the Pooling and Servicing Agreement, the Sub-Servicer shall perform the obligations of the Master Servicer under Section
3.24 of the Pooling and Servicing Agreement (including dealing directly with the Special Servicer on matters for which
the Pooling and Servicing Agreement requires the Master Servicer to deal with the Special Servicer) without the approval of the
Master Servicer, but subject to all requirements and restrictions set forth in Section 3.24 of the Pooling and Servicing
Agreement; provided, however, that the Sub-Servicer shall copy the Master Servicer on all correspondence to the Special Servicer
regarding such matters and the Sub-Servicer shall prepare any package and analysis necessary to obtain any required Rating Agency
Confirmation and forward such package to the Master Servicer for the Master Servicer to deal with the Rating Agencies. Notwithstanding
anything herein to the contrary, the Sub-Servicer will not permit or consent to any Special Servicer Decision or a Major Decision
without the prior written consent of the Special Servicer. The Master Servicer, not the Sub-Servicer, will deal directly with
the Rating Agencies and, as necessary, the Operating Advisor and the Directing Holder, in connection with obtaining any necessary
approval or consent from such parties. When forwarding a request for the approval of any lease or renewal or extension thereof,
the Sub-Servicer shall forward to the Special Servicer the information concerning such lease required by, and in the form of,
Exhibit I attached hereto. The Sub-Servicer will not permit any Principal Prepayment with respect to any Mortgage
Loan without the written consent of the Master Servicer. The Sub-Servicer shall promptly forward all requests for Principal Prepayments
to the Master Servicer, along with a payoff statement setting forth the amount of the necessary Principal Prepayment calculated
by the Sub-Servicer. The Master Servicer shall respond to the Sub-Servicer promptly (but no later than five (5) Business Days
or such later date as necessary to obtain any consents or approvals required by any related intercreditor or other related agreement)
following its receipt of any such request for consent and payoff statement.

 

(27)        Section
3.25 is not incorporated herein. The Sub-Servicer will not permit any replacement of a Manager for the related Mortgaged Property
with respect to any Mortgage Loan without the express written consent of the Special Servicer (if the consent of the Special Servicer
is required on such matter under the Pooling and Servicing Agreement; provided, however, that the Sub-Servicer shall copy the
Master Servicer on all correspondence to the Special Servicer regarding such matters).

 

(28)        Section
3.30 is not incorporated herein. Notwithstanding any provision herein to the contrary, the Sub-Servicer shall not deliver
any information to the Rating Agencies or make any request to a Rating Agency for a Rating Agency Confirmation; all such requests
shall be made by, and as determined necessary by, the Master Servicer. The Sub-Servicer shall not orally communicate with any
Rating Agency regarding any of the Loan Documents or any matter related to the Mortgage Loans, the related Mortgaged Properties,
the related Mortgagors or any other matters in connection with the Certificates or pursuant to this Agreement or the Pooling and
Servicing Agreement. The Sub-Servicer agrees to comply (and to cause each and every subcontractor, vendor or agent

 

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for the Sub-Servicer
and each of its officers, directors and employees to comply) with the provisions relating to communications with the Rating Agencies
set forth in this paragraph and shall not deliver to any Rating Agency any report, statement, request for Rating Agency Confirmation
or other information restricted by the Pooling and Servicing Agreement. All information described above in this Section
3.01(c)(28) will be provided by, and all such communications, responses and requests described in the immediately preceding
paragraph will be made by, the Master Servicer in accordance with the procedures required by the Pooling and Servicing Agreement.
To the extent that the Master Servicer is required to provide any information to, or communicate with, any Rating Agency in accordance
with its obligations under the Pooling and Servicing Agreement and such information or communication is regarding the Mortgage
Loans or the sub-servicing by the Sub-Servicer under this Agreement, the Sub-Servicer shall provide the information to the Master
Servicer necessary for the Master Servicer to fulfill such obligations.

 

Subject
to any restrictions in the Pooling and Servicing Agreement, none of the foregoing restrictions in this Section 3.01(c)(28)
prohibit or restrict oral or written communications, or providing information, between the Sub-Servicer and any Rating
Agency with regard to (i) such Rating Agency’s review of the ratings it assigns to the Sub-Servicer, (ii) such Rating Agency’s
approval of the Sub-Servicer as a commercial mortgage master, special or primary servicer or (iii) such Rating Agency’s
evaluation of the Sub-Servicer’s servicing operations in general; provided, however, that the Sub-Servicer shall not provide
any information relating to the Certificates or the Mortgage Loans to a Rating Agency in connection with such review and evaluation
by such Rating Agency unless (x) borrower, property or deal specific identifiers are redacted; (y) the Master Servicer confirms
to the Sub-Servicer in writing that it has previously provided such information to the Rule 17g-5 Information Provider and has
not provided such information to such Rating Agency until the earlier of (a) receipt of notification from the Rule 17g-5 Information
Provider that such information has been posted to the Rule 17g-5 Information Provider’s Website and (b) after 12:00 p.m.
on the first Business Day following the date it has provided such information to the Rule 17g-5 Information Provider; or (z) such
Rating Agency has confirmed in writing to the Sub-Servicer that it does not intend to use such information in undertaking credit
surveillance for any Class of Certificates (and the Sub-Servicer shall, upon written request, certify to the Depositor, with copy
to the Master Servicer, that it received the confirmation described in this clause (z)).

 

(29)        Section
4.02(b) is not incorporated herein. The Sub-Servicer shall deliver to the Master Servicer, no later than 4:00 p.m. New York
City time on the Sub-Servicer Remittance Date, by electronic transmission in the format mutually agreed upon by the Master Servicer
and the Sub-Servicer, the CREFC® Financial File, the CREFC® Property File, the CREFC®
Comparative Financial Status Report, the CREFC® Loan Level Reserve/LOC Report, the CREFC® Total
Loan Report, a CREFC® Delinquent Loan Status Report and a CREFC® Servicer Watch List/Portfolio Review
Guidelines, each providing the required information as of the related Determination Date. To the extent any Mortgage Loan becomes
a Specially Serviced Loan, the Sub-Servicer shall send to the related Mortgagor a notice directing the Mortgagor to forward to
the Special Servicer

 

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annual, quarterly and monthly operating statements, budgets and rent rolls of the related Mortgaged Property,
and financial statements of the related Mortgagor. The preparation and maintenance by the Sub-Servicer of all the reports specified
in this Section 3.01(c)(29), including the calculations made therein, shall be done in accordance with CREFC®
standards to the extent applicable thereto. The Sub-Servicer shall deliver to the Master Servicer by electronic transmission
in a format mutually agreed upon by the Master Servicer and the Sub-Servicer, (a) on a monthly basis not later than 4:00 p.m.
New York City time on each Sub-Servicer Remittance Date, the Collection Report (the information therein to be stated as of the
Determination Date) and (b) on a quarterly basis starting for the quarter ending September of 2015 (provided that the first such
certification shall cover the period from the Closing Date to the end of such quarter), within thirty (30) days of the end of
such quarter, the information on the Mortgage Loans, including without limitation information regarding UCC financing statements,
taxes, insurance premiums and ground rents on a quarterly basis, required by and in the form of Exhibit E attached
hereto. The Sub-Servicer shall deliver to the Master Servicer no later than 4:00 pm New York City time on the first Business Day
of each month by electronic transmission in a format designated by the Master Servicer, a remittance report containing scheduled
balance information for each Mortgage Loan reflecting the scheduled Monthly Payment for such month (also known as a “Day
One Report”) in the form of Exhibit G attached hereto. In addition, on each day that the Sub-Servicer forwards
to the Master Servicer any funds pursuant to Section 3.01(c)(30) of this Agreement, the Sub-Servicer shall deliver
the Collection Report to the Master Servicer by electronic transmission in a format mutually agreed upon by the Master Servicer
and the Sub-Servicer. The Sub-Servicer shall also prepare and deliver to the Master Servicer, not later than 4:00 p.m. New York
City time on the 25th day of the calendar month following each calendar quarter beginning with the calendar quarter
ending in September of 2015 a certification in the form of Exhibit J. Following the Closing Date, the Master Servicer
shall provide a CREFC® Loan Setup File, CREFC® Property File and CREFC® Comparative
Financial Status Report to the Sub-Servicer.

 

The
Sub-Servicer shall forward to the Master Servicer promptly upon completion, and in any event at least five (5) Business Days before
the Master Servicer must deliver or make available such reports, statements and files under the Pooling and Servicing Agreement,
a copy of all income statements, rent rolls and other reporting information collected by the Sub-Servicer and electronically deliver
in Microsoft Excel format the CREFC® Operating Statement Analysis Report and CREFC® NOI Adjustment
Worksheet with respect to the Mortgage Loans as required by Section 4.02(b) of the Pooling and Servicing Agreement.

 

(30)        Section
4.06 is not incorporated herein. By 4:00 p.m. New York City time on the Sub-Servicer Remittance Date immediately preceding
each Distribution Date, the Sub-Servicer shall remit to the Master Servicer by wire transfer the Available Distribution Amount
for such date. Each month, by 4:00 p.m. New York City time on each Business Day between the Sub-Servicer Remittance Date and the
Distribution Date, the Sub-Servicer shall forward to the Master Servicer by wire transfer the Available Distribution Amount for
such date. Each month, on each Business Day that the Sub-Servicer is not required to remit to the Master Servicer pursuant to
the previous two

 

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sentences, the Sub-Servicer shall forward to the Master Servicer by wire transfer all amounts collected by the
Sub-Servicer and not previously remitted to the Master Servicer which constitute delinquent payments on the Mortgage Loans and
any related late fees or Default Interest to the extent not due to the Sub-Servicer. Section 3.01(c)(29) of this
Agreement sets forth certain reporting requirements with respect to such remittances. The Sub-Servicer shall have no obligation
to make P&I Advances.

 

(31)        Sections
10.01, 10.02, 10.03, 10.04, 10.05, 10.06, 10.07, 10.08, 10.09, 10.10 and 10.12. The Sub-Servicer shall perform all obligations
and be subject to all restrictions and requirements applicable to the Master Servicer or “Sub-Servicer” in such Sections
as they relate to its duties thereunder. In addition, if the Sub-Servicer is a “Servicing Function Participant” or
“Reporting Servicer” it shall perform all obligations and be subject to all restrictions and requirements applicable
to a “Servicing Function Participant” or “Reporting Servicer” in such Sections. The Sub-Servicer shall
cooperate with requests by the Master Servicer, and if the Sub-Servicer is a Servicing Function Participant or Reporting Servicer,
the Trustee and the Depositor in connection with the satisfaction of the Trust’s reporting requirements under the Exchange
Act as they relate to its duties hereunder and as required by Regulation AB. The Sub-Servicer shall have a reasonable period of
time to comply with any written request made under Section 10.01 or 10.02 of the Pooling and Servicing Agreement,
but in any event, shall, upon reasonable advance written request, provide information in sufficient time to allow the Depositor
to satisfy any related filing requirements. It is hereby acknowledged that, as of the Closing Date, the Sub-Servicer is a Servicing
Function Participant, a Reporting Servicer and an Additional Servicer.

 

The
Sub-Servicer shall cooperate fully with the Master Servicer and deliver to the Master Servicer any and all statements, reports,
certifications, records and any other information in its possession or reasonably available to it and necessary in the reasonable
good faith determination of the Master Servicer, the Certificate Administrator or the Depositor to permit the Depositor to comply
with the provisions of Regulation AB and the Master Servicer to comply with its obligations under Article X of the
Pooling and Servicing Agreement, together with such disclosures relating to the Sub-Servicer, or the servicing of the Mortgage
Loans, reasonably believed by the Depositor, the Certificate Administrator and/or the Master Servicer in good faith to be necessary
in order to effect such compliance, as it relates to the Sub-Servicer’s duties thereunder.

 

For
purposes of Section 10.02 of the Pooling and Servicing Agreement, references to the Depositor and Certificate Administrator
shall not mean the Master Servicer, and the Sub-Servicer shall deliver such written notice and any additional information required
directly to the Depositor with a copy to the Master Servicer.

 

With
respect to any period that the Sub-Servicer is a Servicing Function Participant or a servicer as contemplated by Item 1108(a)(2)
of Regulation AB, the Sub-Servicer shall perform all obligations under Sections 10.01 and 10.03 of the Pooling and
Servicing Agreement applicable to a Servicing Function Participant or such a servicer (including, without limitation, any obligation
or duty the Master Servicer is required under Sections 10.01 and 10.03 of the Pooling and Servicing Agreement to
cause (or use

 

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commercially reasonable efforts to cause) a Servicing Function Participant or such a servicer to perform).

 

Any
Additional Form 10-D Disclosure and related Additional Disclosure Notification required to be delivered by the Sub-Servicer shall
be delivered to the Master Servicer (and, if the Sub-Servicer is a Servicing Function Participant or an Additional Servicer, also
to the Depositor and the Certificate Administrator) within the time provided in Section 10.04 of the Pooling and
Servicing Agreement.

 

Any
Additional Form 10-K Disclosure and related Additional Disclosure Notification required to be delivered by the Sub-Servicer shall
be delivered to the Master Servicer (and, if the Sub-Servicer is a Servicing Function Participant or an Additional Servicer, also
to the Depositor and the Certificate Administrator) within the time provided in Section 10.05 of the Pooling and
Servicing Agreement.

 

The
Sub-Servicer (without regard to whether the Sub-Servicer is a Servicing Function Participant, Reporting Servicer or Additional
Servicer) shall provide a Sarbanes-Oxley Certification described in Section 10.06 of the Pooling and Servicing Agreement
(on which the Master Servicer and its officers, directors and Affiliates, and only if the Sub-Servicer is a Servicing Function
Participant, also the Certification Parties, can reasonably rely) to the Master Servicer at least five (5) Business Days before
the Master Servicer must deliver its Sarbanes-Oxley Certification. If the Sub-Servicer is a Servicing Function Participant, such
Sarbanes-Oxley Certification shall also be provided to the Certifying Person by the time required by the Pooling and Servicing
Agreement, and if the Sub-Servicer is not a Servicing Function Participant, such Sarbanes-Oxley Certification shall be delivered
only to the Master Servicer. In addition, the Sub-Servicer (a) shall provide such information and assistance as may be reasonably
required to cooperate with the Master Servicer in complying with Section 10.06 of the Pooling and Servicing Agreement
and (b) shall cooperate with the Master Servicer’s reasonable requests in performing its due diligence for its certification
under Section 10.06 of the Pooling and Servicing Agreement.

 

Any
Form 8-K Disclosure Information and related Additional Disclosure Notification required to be delivered by the Sub-Servicer (only
if the Sub-Servicer is an Additional Servicer) shall be delivered to the Master Servicer, the Depositor and the Certificate Administrator
within the time provided in Section 10.07 of the Pooling and Servicing Agreement.

 

The
Sub-Servicer (without regard to whether the Sub-Servicer is an Additional Servicer) shall deliver its Officer’s Certificate
required by Section 10.08 of the Pooling and Servicing Agreement to the Master Servicer at least three (3) Business
Days before the Master Servicer must deliver its Officer’s Certificate under Section 10.08 of the Pooling
and Servicing Agreement. If the Sub-Servicer is an Additional Servicer, the Sub-Servicer shall also deliver such Officer’s
Certificate to the Certificate Administrator, the Depositor, the Rule 17g-5 Information Provider and, prior to the occurrence
and continuance of a Consultation Termination Event, the Controlling Class Representative within the time provided in Section
10.08, and if the Sub-Servicer is not an Additional

 

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Servicer, such Officer’s Certificate shall be delivered only
to the Master Servicer. The Sub-Servicer shall not be required to cause the delivery of any such statement until five (5) Business
Days prior to March 15 in any given year so long as it has received written confirmation from the Depositor or the Master Servicer
that a report on Form 10-K is not required to be filed in respect of the Trust for the preceding calendar year.

 

The
Sub-Servicer (without regard to whether the Sub-Servicer is a Servicing Function Participant or Reporting Servicer) shall deliver
the items required under Sections 10.09 and 10.10 of the Pooling and Servicing Agreement regarding itself (the “report
on an assessment of compliance with Relevant Servicing Criteria” and “accountants’ report”) to the Master
Servicer at least three (3) Business Days before the Master Servicer must deliver its Sections 10.09 and 10.10 items.
If the Sub-Servicer is a Servicing Function Participant, Reporting Servicer or Additional Servicer the report on an assessment
of compliance with Relevant Servicing Criteria and accountants’ report shall also be delivered to the Certificate Administrator,
the Trustee and the Depositor within the time provided in Sections 10.09 and 10.10 of the Pooling and Servicing
Agreement. Only if the Sub-Servicer is a Servicing Function Participant, and only with respect to the accountants’ report,
the Sub-Servicer shall also deliver such report to the 17g-5 Information Provider and, prior to the occurrence and continuation
of a Consultation Termination Event, the Controlling Class Representative within the time provided in Section 10.10
of the Pooling and Servicing Agreement. If the Sub-Servicer is not a Servicing Function Participant or Reporting Servicer, the
report on an assessment of compliance with Relevant Servicing Criteria and accountants’ report shall be delivered only to
the Master Servicer. The Sub-Servicer shall not be required to cause the delivery of any such report on assessment or accountant’s
report until five (5) Business Days prior to March 15 in any given year so long as it has received written confirmation from the
Depositor or the Master Servicer that a report on Form 10-K is not required to be filed in respect of the Trust for the preceding
calendar year.

 

With
respect to the Sub-Servicer obligations in Sections 10.08 and 10.10 of the Pooling and Servicing Agreement to send
reports to the Controlling Class Representative, the Master Servicer shall, upon request from the Sub-Servicer, confirm if the
Master Servicer has received notice that a Consultation Termination Event occurred in the prior year. The Sub-Servicer may rely
on any such notice, without any independent investigation or inquiry.

 

Section
10.12 of the Pooling and Servicing Agreement shall be incorporated herein and apply to the Sub-Servicer for so long as
the Sub-Servicer is a Servicing Function Participant or an Additional Servicer. In connection with comments provided to the Depositor
from the Commission regarding information (x) delivered by the Sub-Servicer, (y) regarding the Sub-Servicer and (z) prepared by
the Sub-Servicer or any registered public accounting firm, attorney or other agent retained by such party to prepare such information,
which information is contained in a report filed by the Depositor under the Reporting Requirements and which comments are received
subsequent to the Depositor’s filing of such report, the Depositor is required pursuant to Section 10.12 of
the Pooling and Servicing Agreement to promptly provide to the Sub-Servicer any such comments which related to the Sub-Servicer.
Sub-Servicer shall be

 

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responsible for timely preparing a written response to the Commission for inclusion in the Depositor’s
or the Master Servicer’s, as applicable, response to the Commission, unless Sub-Servicer elects, with the consent of the
Master Servicer (which consent shall not be unreasonably denied, withheld or delayed), to directly communication with the Commission
and negotiate a response and/or resolution with the Commission. If such election is made, the Sub-Servicer shall be responsible
for directly negotiating such response and/or resolution with the Commission in a timely manner; provided, that (i) Sub-Servicer
shall use reasonable efforts to keep the Depositor and the Master Servicer informed of its progress with the Commission and copy
the Depositor and the Master Servicer on all correspondence with the Commission and provide the Depositor and the Master Servicer
with the opportunity to participate (at the Depositor’s or Master Servicer’s, as applicable, expense) in any telephone
conferences and meetings with the Commission and (ii) the Master Servicer shall cooperate with the Sub-Servicer in order to authorize
the Sub-Servicer and its representatives to respond to and negotiate directly with the Commission with respect to any comments
received from the Commission or its staff relating to Sub-Servicer and to notify the Commission of such authorization. The Master
Servicer and the Sub-Servicer shall cooperate and coordinate with each other with respect to any requests made to the Commission
for any extension of time for submitting a response or compliance. All reasonable out-of-pocket costs and expenses incurred by
the Depositor and the Master Servicer (including reasonable legal fees and expenses of outside counsel to the Depositor and the
Master Servicer) in connection with the foregoing and any amendments to any reports filed with the Commission in connection therewith
shall be promptly paid by the Sub-Servicer upon receipt of an itemized invoice from the Depositor and/or the Master Servicer,
as applicable.

 

Following
its receipt of notice from the Certificate Administrator that it has filed a form to suspend reporting obligations with respect
to the Trust as contemplated by Section 10.19 of the Pooling and Servicing Agreement, the Master Servicer shall
provide such notice to the Sub-Servicer; provided, however, failure to so notify shall not be considered a Sub-Servicer Termination
Event under this Agreement.

 

Subject
to other provisions of this Agreement restricting the right of the Sub-Servicer to retain subservicers or subcontractors, the
provisions of Article X regarding retaining a “Sub-Servicer,” “Subcontractor,” “Additional
Servicer” or “Servicing Function Participant” shall be applicable to any sub-servicer, subcontractor or agent
hired by the Sub-Servicer to perform any of its obligations hereunder and the Sub-Servicer shall comply with such provisions.

 

If
at any time the Sub-Servicer is a Servicing Function Participant, the Sub-Servicer shall indemnify and hold harmless the Master
Servicer, each Certification Party, the Depositor, each Other Depositor, any employee, director or officer of the Depositor or
any Other Depositor from and against any and all claims, losses, damages, penalties, fines, forfeitures, legal fees and expenses
and related costs, judgments and any other costs, fees and expenses incurred by such indemnified party arising out of (i) a breach
of its obligations to provide any of the annual compliance statements or annual servicing criteria compliance reports or attestation
reports pursuant to this Agreement, (ii) negligence, bad faith or willful misconduct on its part in the performance of such

 

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obligations,
(iii) any failure by a Servicer (as defined in Section 10.02(b) of the Pooling and Servicing Agreement) to identify
a Servicing Function Participant pursuant to Section 10.02 of the Pooling and Servicing Agreement or (iv) any Deficient
Exchange Act Deliverable with respect to the Sub-Servicer.

 

If
the indemnification provided for in this Section 3.01(c)(31) is unavailable or insufficient to hold harmless
any Certification Party, the Master Servicer, the Depositor, any Other Depositor, any employee, director or officer of the Depositor,
any Other Depositor or the Master Servicer, or any other person who controls the Depositor or any Other Depositor within the meaning
of either Section 15 of the Securities Act or Section 20 of the Exchange Act, then the Sub-Servicer shall contribute to the amount
paid or payable to the indemnified party as a result of the losses, claims, damages or liabilities of the indemnified party in
such proportion as is appropriate to reflect the relative fault of the indemnified party on the one hand and the Sub-Servicer
on the other in connection with a breach of the Sub-Servicer’s obligations pursuant to this Section 3.01(c)(31).

 

(32)        If
the Sub-Servicer receives a Form ABS Due Diligence-15E from any Person in connection with any third-party “due diligence
services” (as defined in Rule 17g-10 under the Exchange Act) provided by such Person with respect to the Mortgage Loans
(“Due Diligence Service Provider”), the Sub-Servicer shall promptly forward such Form ABS Due Diligence-15E
to the Master Servicer.

 

Section
3.02     Merger or Consolidation of the Sub-Servicer.

 

Subject
to the following paragraph, the Sub-Servicer shall keep in full effect its existence, rights and good standing as a limited liability
company under the laws of the state of its organization and shall not jeopardize its ability to do business in each jurisdiction
in which the Mortgaged Properties are located, to the extent necessary to perform its obligations under this Agreement, or to
protect the validity and enforceability of this Agreement, the Certificates or any of the Mortgage Loans and to perform its duties
under this Agreement.

 

Any
Person into which the Sub-Servicer may be merged or consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Sub-Servicer shall be a party, or any Person succeeding to the business or substantially all of the
servicing business of the Sub-Servicer, shall be the successor of the Sub-Servicer 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; provided,
however, that the successor or surviving Person (i) must be a company whose business includes the servicing of mortgage loans
and shall be authorized to transact business in each state in which the Mortgaged Properties it is to service are situated, (ii)
must be acceptable to the Master Servicer (which acceptance shall not be unreasonably withheld, conditioned or delayed), and (iii)
shall assume in writing the obligations of the Sub-Servicer under this Agreement.

 

Section
3.03     Limitation on Liability of the Sub-Servicer and Others.

 

Neither
the Sub-Servicer nor any of the Affiliates, directors, members, managers, officers, employees or agents of the Sub-Servicer shall
be under any liability to the Master

 

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Servicer for any action taken or for refraining from the taking of any action in good faith
pursuant to this Agreement, or for errors in judgment; provided, however, that this provision shall not protect the Sub-Servicer
or any of its Affiliates, directors, members, managers, officers, employees or agents against liability to the Master Servicer
for any breach of any representation or warranty made herein, or against any liability which would otherwise be imposed by reason
of willful misconduct, bad faith, fraud or negligence in the performance of obligations or duties hereunder or by reason of negligent
disregard of obligations or duties hereunder. The Sub-Servicer and any Affiliate, director, member, officer, employee or agent
of the Sub-Servicer may rely on any document of any kind which, prima facie, is properly executed and submitted by any
Person respecting any matters arising hereunder. The Sub-Servicer shall not be under any obligation to appear in, prosecute or
defend any legal or administrative action (whether in equity or at law), proceeding, hearing or examination that is not incidental
to its duties under this Agreement or which in its opinion may involve it in any expense or liability not recoverable hereunder;
provided, however, that the Sub-Servicer may, with the consent of the Master Servicer, undertake any such action which it may
deem necessary or desirable in respect to this Agreement and the rights and duties of the parties hereto. In such event, the legal
expenses and all costs of such action and any loss, liability, penalty, fine, forfeiture, claim or judgment resulting therefrom,
to the extent the Master Servicer may recover such amounts from the Trust Fund pursuant to the Pooling and Servicing Agreement,
shall be expenses, costs and liabilities for which the Master Servicer will be liable and the Sub-Servicer shall be entitled to
be reimbursed therefor from the Master Servicer upon written demand. To the extent provided in Section 6.03 of the
Pooling and Servicing Agreement, the Sub-Servicer shall be indemnified and held harmless by the Trust Fund against any loss, liability,
penalty, fine, forfeiture, claim, judgment or expense (including reasonable legal fees and expenses) incurred in connection
with, or relating to, this Agreement or the Certificates, other than any loss, liability, penalty, fine, forfeiture, claim, judgment
or expense (including reasonable legal fees and expenses) (i) incurred by reason of willful misconduct, bad faith, fraud
or negligence in the performance of obligations or duties hereunder or by reason of negligent disregard of obligations or duties
hereunder in each case by the Sub-Servicer, (ii) resulting from the breach by the Sub-Servicer of any of its representations
or warranties contained herein, or (iii) specifically required to be borne the Sub-Servicer without right of reimbursement
pursuant to the terms hereof. The Sub-Servicer shall not have any rights of indemnification out of the Trust Fund except through
the Master Servicer as described above.

 

Section
3.04     Sub-Servicer Resignation.

 

The
Sub-Servicer may not resign from the obligations and duties hereby imposed on it except by mutual consent of the Sub-Servicer
and the Master Servicer and payment by the Sub-Servicer of all reasonable out-of-pocket costs and expenses of the Master Servicer
in connection with such resignation and transfer of servicing, or upon the determination that its duties hereunder are no longer
permissible under applicable law and such incapacity cannot be cured by the Sub-Servicer. Any such determination permitting the
resignation of the Sub-Servicer because its duties are no longer permissible under applicable law shall be evidenced by an Opinion
of Counsel to such effect delivered to the Master Servicer, which Opinion of Counsel shall be in form and substance acceptable
to the Master Servicer.

 

Section
3.05     No Transfer or Assignment of Servicing.

 

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With
respect to the responsibility of the Sub-Servicer to service the Mortgage Loans hereunder, the Sub-Servicer acknowledges that
the Master Servicer has acted in reliance upon the Sub-Servicer’s independent status, the adequacy of its servicing facilities,
plant, personnel, records and procedures, its integrity, reputation and financial standing and the continuance thereof. Without
in any way limiting the generality of this Section 3.05, the Sub-Servicer shall neither assign or transfer this
Agreement or the servicing hereunder nor delegate its rights or duties hereunder or any portion thereof, without the prior written
approval of the Master Servicer and the prior written consent of the Depositor, which consent will not be unreasonably conditioned,
withheld or delayed. Notwithstanding the foregoing, prior to any assignment or transfer by the Sub-Servicer of this Agreement,
the servicing hereunder or the delegation of any of the Sub-Servicer’s rights or duties hereunder or the delegation of any
of the Sub-Servicer’s rights or duties hereunder (the “Sub-Servicing Rights”), the Sub-Servicer shall
allow the Master Servicer an opportunity (but not an obligation) to bid on the purchase or assumption of such Sub-Servicing Rights.
The Sub-Servicer may also solicit bids from any other parties independent of the Master Servicer. If after receipt by the Sub-Servicer
of all bids, the Master Servicer is not the highest bidder, the Master Servicer shall be given the opportunity (but not the obligation)
to submit a second bid, which bid shall be the final bid received by the Sub-Servicer and shall be given equal consideration by
the Sub-Servicer with all other bids. The Sub-Servicer shall notify the Master Servicer upon the completion of any assignment
(except to the Master Servicer as contemplated above) and provide any information, applicable to the Sub-Servicer, as required
pursuant to Section 10.02 of the Pooling and Servicing Agreement.

 

Section
3.06     Indemnification.

 

The
Master Servicer and the Sub-Servicer each agrees to and hereby does indemnify and hold harmless the Master Servicer, in the case
of the Sub-Servicer, and the Sub-Servicer, in the case of the Master Servicer (including any of their Affiliates, directors, members,
managers, officers, employees or agents) from and against any and all liability, claim, loss, out-of-pocket cost (including reasonable
attorneys’ fees), penalty, expense or damage of the Master Servicer, in the case of the Sub-Servicer, and the Sub-Servicer,
in the case of the Master Servicer (including any of their Affiliates, directors, officers, employees or agents) resulting from
(i) any breach by the indemnitor of a representation or warranty made by it herein, or (ii) any willful misconduct, bad faith,
fraud or negligence by the indemnitor in the performance of its obligations or duties hereunder or by reason of negligent disregard
of such obligations and duties; provided, that such indemnity shall not cover indirect or consequential damages. Each indemnified
party hereunder shall give prompt written notice to the indemnitor of matters which may give rise to liability of such indemnitor
hereunder; provided, however, that failure to give such notice shall not relieve the indemnitor of any liability except to the
extent of actual prejudice. This Section 3.06 shall survive the termination of this Agreement and the termination
or resignation of the Master Servicer or the Sub-Servicer. Notwithstanding the foregoing, the Sub-Servicer shall not have any
direct rights of indemnification that may be satisfied out of assets of the Trust Fund.

 

ARTICLE
IV

DEFAULT

 

Section
4.01     Events of Default.

 

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In case one or more
of the following events (each a “Sub-Servicer Termination Event”) by the Sub-Servicer shall occur and be continuing,
that is to say:

 

(i)            any
failure by the Sub-Servicer to deposit into the Sub-Servicer Collection Account or any Escrow Account, or to deposit into, or to
remit to the Master Servicer for deposit into, the Collection Account, on a timely basis, any amount required to be so deposited
or remitted under this Agreement, which failure continues unremedied for one (1) Business Day following the date on which such
deposit or remittance is required to be made; or

 

(ii)           any
failure on the part of the Sub-Servicer to (a) timely provide to the Master Servicer the certification called for on Exhibit
E attached hereto as required by Section 3.01(c)(29) of this Agreement which failure continues unremedied
for five (5) Business Day after the Sub-Servicer’s receipt of notice from the Master Servicer of such failure, or (b) timely
provide to the Master Servicer the Collection Report which failure continues unremedied for one (1) Business Day after the Sub-Servicer’s
receipt of notice from the Master Servicer of such failure; or

 

(iii)          the
Sub-Servicer shall fail three (3) times within any two (2) year period to timely provide to the Master Servicer any report required
by this Agreement to be provided to the Master Servicer, each of which failure continues unremedied for five (5) Business Days
after the Sub-Servicer’s receipt of notice from the Master Servicer of such failure; or

 

(iv)          if
the Sub-Servicer is a Servicing Function Participant or an Additional Servicer, any failure by the Sub-Servicer to deliver by the
due date any Exchange Act reporting items required to be delivered to the Master Servicer under Article X of the
Pooling and Servicing Agreement or under this Agreement (following the expiration of any applicable grace period); or

 

(v)           if
the Sub-Servicer is a Servicing Function Participant or an Additional Servicer, any failure by the Sub-Servicer to perform in any
material respect any of the covenants or obligations of the Sub-Servicer contained in this Agreement regarding creating, obtaining
or delivering any Exchange Act reporting items required for any party to the Pooling and Servicing Agreement to perform its obligations
under Article X of the Pooling and Servicing Agreement (following the expiration of any applicable grace period);
or

 

(vi)          any
failure on the part of the Sub-Servicer duly to observe or perform in any material respect any other of the covenants or agreements
on the part of the Sub-Servicer contained in this Agreement which continues unremedied for a period of twenty-five (25) days (ten
(10) days in the case of payment of insurance premiums or in any event such shorter period of time (not less than two (2) Business
Days) as is necessary to avoid the commencement of foreclosure proceedings for any lien relating to unpaid real estate taxes or
a lapse in any required insurance coverage if the Sub-Servicer had prior notice of the related borrower’s failure to pay
such taxes, assessments or insurance premium) after the date on which written notice of such failure, requiring the same to be
remedied, shall have been given to the Sub-Servicer by the Master Servicer; provided, however, if such failure is
capable of being cured and the Sub-Servicer is diligently pursuing such cure, such 25-day period will be extended an additional
sixty (60) days; provided, further, however, that such extended period will not apply to the obligations regarding
Exchange Act reporting; or

 

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(vii)        any
breach on the part of the Sub-Servicer of any representation or warranty contained in Section 2.05 of the Pooling
and Servicing Agreement as incorporated herein pursuant to Section 3.01(c)(2) which materially and adversely affects
the interests of the Master Servicer or any Class of Certificateholders and which continues unremedied for a period of thirty (30)
days after the date on which notice of such breach, requiring the same to be remedied, shall have been given to the Sub-Servicer
by the Master Servicer; provided, however, if such breach is capable of being cured and the Sub-Servicer is diligently
pursuing such cure, such thirty (30) day period will be extended an additional sixty (60) days; or

 

(viii)       a
decree or order of a court or agency or supervisory authority having jurisdiction in the premises in an involuntary case under
any present or future federal or state bankruptcy, insolvency or similar law for the appointment of a conservator, receiver, liquidator,
trustee or similar official in any bankruptcy, insolvency, readjustment of debt, marshaling of assets and liabilities or similar
proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Sub-Servicer and such decree
or order shall have remained in force undischarged or unstayed for a period of sixty (60) days; or

 

(ix)          the
Sub-Servicer shall consent to the appointment of a conservator, receiver, liquidator, trustee or similar official in any
bankruptcy, insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to
the Sub-Servicer or of or relating to all or substantially all of its property; or

 

(x)           the
Sub-Servicer shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage
of any applicable bankruptcy, insolvency or reorganization statute, make an assignment for the benefit of its creditors, voluntarily
suspend payment of its obligations, or take any corporate action in furtherance of the foregoing; or

 

(xi)          the
Sub-Servicer shall assign or transfer or attempt to assign or transfer all or part of its rights and obligations hereunder except
as permitted by this Agreement; or

 

(xii)         any
of Moody’s, Fitch or KBRA has (A) qualified, downgraded or withdrawn its rating or ratings of one or more Classes of
Certificates, or (B) placed one or more Classes of Certificates on “watch status” in contemplation of rating downgrade
or withdrawal and, in the case of either of clauses (A) or (B), publicly citing servicing concerns with the Sub-Servicer as
the sole or material factor in such rating action (and such qualification, downgrade, withdrawal or “watch status”
placement has not been withdrawn by such Rating Agency, within 60 days of such event);

 

If any Sub-Servicer
Termination Event shall occur and be continuing, then, and in each and every such case, so long as such Sub-Servicer Termination
Event shall not have been remedied, the Master Servicer or, with respect to any Sub-Servicer Termination Event under clause (iv)
above, the Depositor, may terminate, by notice in writing to the Sub-Servicer, all of the rights and obligations of the Sub-Servicer
as Sub-Servicer under this Agreement and in and to the Mortgage Loans and the proceeds thereof. From and after the receipt by the
Sub-Servicer of such written notice, all authority and power of the Sub-Servicer under this Agreement, whether with respect to
the Mortgage Loans or otherwise, shall pass to and be vested in the Master Servicer pursuant to and under this Section, and, without
limitation, the Master Servicer

 

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is hereby authorized and empowered to execute and deliver, on behalf of and at the expense of the
Sub-Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to 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. The Sub-Servicer agrees that if it is
terminated pursuant to this Section, it shall promptly (and in any event no later than ten (10) Business Days subsequent to its
receipt of the notice of termination) provide the Master Servicer with all documents and records (including, without limitation,
those in electronic form) requested by it to enable it to assume the Sub-Servicer’s functions hereunder, and shall cooperate
with the Master Servicer in effecting the termination of the Sub-Servicer’s responsibilities and rights hereunder and the
assumption by a successor of the Sub-Servicer’s obligations hereunder, including, without limitation, the transfer within
one (1) Business Day to the Master Servicer for administration by it of all cash amounts which shall at the time be or should have
been credited by the Sub-Servicer to the Sub-Servicer Collection Account, any Collection Account or any Escrow Account, or thereafter
be received with respect to the Mortgage Loans (provided, however, that the Sub-Servicer shall continue to be entitled to receive
all amounts accrued or owing to it under this Agreement on or prior to the date of such termination, and it and its Affiliates,
directors, members, managers, officers, employees and agents shall continue to be entitled to the benefits of Section 3.03
and Section 3.06 of this Agreement notwithstanding any such termination).

 

In addition to any
other rights the Master Servicer may have hereunder, if the Sub-Servicer fails to remit to the Master Servicer any amounts when
required to be remitted hereunder, the Sub-Servicer shall pay to the Master Servicer interest on the amount of such late remittance
at the Prime Rate, applied on a per diem basis for each day such remittance is late (i.e., said per annum rate divided by 365 multiplied
by the number of days late); but in no event shall such interest be greater than the maximum amount permitted by law.

 

Section 4.02          Waiver
of Defaults.

 

The Master Servicer
may waive any default by the Sub-Servicer in the performance of its obligations hereunder and its consequences. Upon any such waiver
of a past default, such default shall cease to exist, and any Sub-Servicer Termination Event 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 thereon except to the extent expressly so waived.

 

Section 4.03          Other
Remedies of Master Servicer.

 

During the continuance
of any Sub-Servicer Termination Event, so long as such Sub-Servicer Termination Event shall not have been remedied, the Master
Servicer, in addition to the rights specified in Section 4.01 of this Agreement, shall have the right, in its own
name, to take all actions now or hereafter existing at law, in equity or by statute to enforce its rights and remedies (including
the institution and prosecution of all judicial, administrative and other proceedings and the filing of proofs of claim and debt
in connection therewith). Except as otherwise expressly provided in this Agreement, no remedy provided for by this Agreement shall
be exclusive of any other remedy, and each and every remedy shall be cumulative and in

 

    	24

    	 

    

 

addition to any other remedy and no delay
or omission to exercise any right or remedy shall impair any such right or remedy or shall be deemed to be a waiver of any Sub-Servicer
Termination Event.

 

ARTICLE
V

TERMINATION

 

Section 5.01          Termination.

 

(a)           Except
as otherwise specifically set forth herein, the rights, obligations and responsibilities of the Sub-Servicer shall terminate (without
payment of any penalty or termination fee): (i) upon the later of the final payment or other liquidation (or any advance with respect
thereto) of the last Mortgage Loan and the remittance of all funds due hereunder; (ii) by mutual consent of the Sub-Servicer and
the Master Servicer in writing; (iii) pursuant to Section 5.02 of this Agreement; (iv) at the option of any purchaser
of any Mortgage Loan pursuant to the Pooling and Servicing Agreement, upon such purchase and only with respect to such purchased
Mortgage Loan; (v) upon a Mortgage Loan becoming an REO Mortgage Loan, and only with respect to such Mortgage Loan; or (vi) upon
termination of the Pooling and Servicing Agreement, each subject to the Sub-Servicer’s rights to accrued and due amounts
to the Sub-Servicer prior to the date of termination.

 

(b)           The
obligations and responsibilities of the Sub-Servicer shall also terminate in accordance with the terms and conditions of Section
3.01(c)(4) of this Agreement.

 

Section 5.02          Termination
With Cause.

 

The Master Servicer
may, at its sole option, terminate any rights the Sub-Servicer may have hereunder with respect to the Mortgage Loans as provided
in Section 4.01 of this Agreement upon the occurrence of a Sub-Servicer Termination Event.

 

Any notice of termination
shall be in writing and delivered to the Sub-Servicer as provided in Section 6.03 of this Agreement.

 

Additionally, the Depositor
may terminate this Agreement (without compensation, termination fee or the consent of any other Person) at any time following any
failure of the Sub-Servicer to deliver any Exchange Act reporting items that the Sub-Servicer is required to deliver under Regulation
AB as otherwise contemplated by Article X of the Pooling and Servicing Agreement.

 

Section
5.03          Reserved

 

Section 5.04          Termination
of Duties with Respect to Specially Serviced Loans.

 

At such time as any
Mortgage Loan becomes a Specially Serviced Loan, the obligations and duties of the Sub-Servicer set forth herein with respect to
such Specially Serviced Loan that are required to be performed by the Special Servicer under the Pooling and Servicing Agreement
shall cease. The Sub-Servicer shall continue to perform all of its duties hereunder with respect to

 

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the Specially Serviced Loans
that are not required to be performed by the Special Servicer pursuant to the Pooling and Servicing Agreement. If a Specially Serviced
Loan becomes a Corrected Loan, the Sub-Servicer shall commence servicing such Corrected Loan pursuant to the terms of this Agreement.

 

ARTICLE
VI

MISCELLANEOUS

 

Section 6.01          Successor
to the Sub-Servicer.

 

Prior to termination
of the Sub-Servicer’s responsibilities and duties under this Agreement pursuant to Sections 3.04, 4.01, 5.01 or 5.02
of this Agreement, the Master Servicer shall (i) succeed to and assume all of the Sub-Servicer’s responsibilities, rights,
duties and obligations under this Agreement, or (ii) appoint a successor which satisfies the criteria for a successor Sub-Servicer
in Section 3.02 of this Agreement and which shall succeed to all rights and assume all of the responsibilities, duties
and liabilities of the Sub-Servicer under this Agreement accruing following the termination of the Sub-Servicer’s responsibilities,
duties and liabilities under this Agreement.

 

Section 6.02          Financial
Statements.

 

The Sub-Servicer shall,
upon the written request of the Master Servicer, make available its publicly available financial statements and other records relevant
to the performance of the Sub-Servicer’s obligations hereunder.

 

Section 6.03          Closing.

 

The commencement of
the Sub-Servicer’s obligation to perform the servicing responsibilities under this Agreement with respect to the Mortgage
Loans shall take place on the Closing Date. The closing shall be by electronic mail.

 

The closing shall be
subject to the execution and delivery of the Pooling and Servicing Agreement by the parties thereto.

 

Section 6.04          Closing
Documents.

 

The Closing Documents
shall consist of all of the following documents:

 

(a)           to
be provided by the Sub-Servicer:

 

(i)            this
Agreement executed by the Sub-Servicer;

 

(ii)           Certificate
of Secretary of the Sub-Servicer, dated the Closing Date addressing certain organizational and authorization matters and reasonably
satisfactory to the Master Servicer; and

 

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(iii)          the
account certifications in the form of Exhibit F hereto required by Sections 3.01(c)(7) and (8) of
this Agreement, fully completed; and

 

(b)          to
be provided by the Master Servicer:

 

(i)            this
Agreement executed by the Master Servicer;

 

(ii)           the
Mortgage Loan Schedule, with one copy to be attached to each counterpart of this Agreement as Exhibit A hereto; and

 

(iii)          the
Pooling and Servicing Agreement substantially in the form of Exhibit C hereto.

 

Section 6.05          Notices.

 

Except as otherwise
provided herein, all demands, notices, consents and communications hereunder shall be in writing and shall be deemed to have been
duly given when delivered to the following addresses:

 

(i)           if
to the Master Servicer:

 

Wells Fargo Bank, National Association

Commercial Mortgage Servicing

MAC D1086

550 South Tryon Street, 14th
Floor

Charlotte, North Carolina 28202

Reference: CGCMT 2015-P1 Asset
Manager

 

with a copy to:

 

Wells Fargo Bank, National Association

Legal Department

301 S. College St., TW-30

D1053-300

Charlotte, North Carolina 28202-6000

Reference: Commercial Mortgage
Servicing Legal Support

 

(ii)          if
to the Sub-Servicer:

 

Principal Global Investors, LLC

801 Grand Avenue

Des Moines, IA 50392-1450

Attention: Steve Johnson, Managing Director

Telephone No.: (515) 246-7095

Facsimile No.: (866) 850-4022

Reference: CGCMT 2015-P1

 

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or such other address as may hereafter be furnished to the other
party by like notice.

 

Section 6.06          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, 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.

 

Section 6.07          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. Delivery of an executed counterpart of a signature page of this Agreement in Portable
Document Format (PDF) or by facsimile transmission shall be as effective as delivery of a manually executed original counterpart
of this Agreement.

 

Section 6.08          Governing
Law.

 

This Agreement and
any claim, controversy or dispute arising under or related to or in connection with this Agreement, the relationship of the parties,
and/or the interpretation and enforcement of the rights and duties of the parties shall be governed by the laws of the State of
New York without regard to any conflicts of law principles other than Section 5-1401 of the New York General Obligations Law.

 

The parties hereto
hereby waive, to the fullest extent permitted by law, the right to trial by jury in any action, proceeding or counterclaim, whether
in contract, tort or otherwise, relating directly or indirectly to this Agreement or the transactions contemplated hereby. Each
of the parties hereto irrevocably (i) submits to the jurisdiction of the courts of the State of New York and the federal courts
of the United States of America for the Southern District of New York for the purpose of any such action or proceeding relating
to this Agreement; (ii) waives, to the fullest extent permitted by law, the defense of an inconvenient forum in any such action
or proceeding in any such court; (iii) agrees that a final judgment in any such action or proceeding in any such court shall be
conclusive and may be enforced in any other jurisdiction by suit on the judgment or in any other manner provided by law; and (iv)
consents to service of process upon it by mailing a copy thereof by certified mail addressed to it as provided for notices hereunder
and agrees that nothing herein shall affect the right to effect service of process in any manner permitted by law.

 

Section 6.09          Protection
of Confidential Information.

 

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The Sub-Servicer shall
keep confidential and shall not divulge to any party other than the Master Servicer, the Depositor, the Special Servicer or the
Trustee, without the Master Servicer’s prior written consent (which consent shall not be unreasonably withheld or delayed),
any information pertaining to the Mortgage Loans, the Mortgaged Properties or any Mortgagor thereunder, except to the extent that
(a) it is appropriate for the Sub-Servicer to do so in (i) working with third party vendors, property inspectors, legal counsel,
auditors, taxing authorities or other governmental agencies or in accordance with this Agreement, (ii) in accordance with the Servicing
Standard, or (iii) when required by any law, regulation, ordinance, court order or subpoena, or (b) the Sub-Servicer is disseminating
general statistical information relating to the mortgage loans being serviced by the Sub-Servicer (including the Mortgage Loans)
so long as Sub-Servicer does not identify the owner of any Mortgage Loan, any Mortgaged Property, or any Mortgagor or violate confidentiality
obligations owed to any Mortgagor under the Loan Documents or otherwise.

 

Section 6.10          Intention
of the Parties.

 

It is the intention
of the parties that the Master Servicer is conveying, and the Sub-Servicer is receiving, only a contract for servicing the Mortgage
Loans. Accordingly, the parties hereby acknowledge that the Trustee remains the sole and absolute beneficial owner of the Mortgage
Loans and all rights related thereto.

 

Section 6.11          Third
Party Beneficiary.

 

The Trustee, for the
benefit of the Certificateholders shall be a third party beneficiary under this Agreement; provided that (except to the extent
the Trustee or its designee assumes the obligations of the Master Servicer hereunder or except as provided in the Pooling and Servicing
Agreement) none of the Trust Fund, the Trustee, the Operating Advisor, the Certificate Administrator or any Certificateholder shall
have any duties under this Agreement or any liabilities arising herefrom. The Depositor shall be a third party beneficiary under
this Agreement solely with respect to Section 10.17 of the Pooling and Servicing Agreement.

 

Section 6.12          Successors
and Assigns; Assignment of Agreement.

 

This Agreement shall
bind and inure to the benefit of and be enforceable by the Sub-Servicer and the Master Servicer and the respective successors and
assigns of the Sub-Servicer and the Master Servicer. This Agreement shall not be assigned, pledged or hypothecated by the Sub-Servicer
to a third party except as otherwise specifically provided for herein. If the Master Servicer shall for any reason no longer act
in such capacity under the Pooling and Servicing Agreement (including, without limitation, by reason of a Servicer Termination
Event), the Trustee or its designee shall thereupon assume all of the rights and, except to the extent they arose prior to the
date of assumption, obligations of the Master Servicer under this Agreement, or, alternatively, may act in accordance with Section
7.02 of the Pooling and Servicing Agreement under the circumstances described therein (subject to Section 3.01(c)
and (d) of the Pooling and Servicing Agreement).

 

Section 6.13          Waivers.

 

    	29

    	 

    

 

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 6.14          Exhibits.

 

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

 

Section 6.15          General
Interpretive Principles.

 

The article and section
headings are for convenience of a reference only, and shall not limit or otherwise affect the meaning hereof.

 

Section 6.16          Complete
Agreement.

 

This Agreement embodies
the complete agreement between the parties regarding the subject matter hereof and may not be varied or terminated except by a
written agreement conforming to the provisions of Section 6.18 of this Agreement. All prior negotiations or representations
of the parties are merged into this Agreement and shall have no force or effect unless expressly stated herein.

 

Section 6.17          Further
Agreement.

 

The Sub-Servicer and
the Master Servicer 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 6.18          Amendments.

 

This Agreement may
only be amended with the consent of the Sub-Servicer and the Master Servicer and, to the extent required by Section 3.01(c)(vii)
of the Pooling and Servicing Agreement, the prior written consent of the Depositor, which consent shall not be unreasonably withheld,
conditioned or delayed. No amendment to the Pooling and Servicing Agreement that purports to change the rights or obligations of
the Sub-Servicer hereunder shall be effective against the Sub-Servicer without the express written consent of the Sub-Servicer.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

    	30

    	 

    

 

IN WITNESS WHEREOF,
the Sub-Servicer and the Master Servicer have caused their names to be signed hereto by their respective officers thereunto duly
authorized as of the date first above written. 

	 	 	 
	 	WELLS FARGO BANK, NATIONAL ASSOCIATION
	 	 	 
	 	By:	     /s/ Cynthia L. Schwartz
	 	Name:  Cynthia L. Schwartz
	 	Title:    Director

 

CGCMT
2015-P1

Principal Sub-Servicing Agreement

 

    	 

    	 

    

	 	 	 
	 	PRINCIPAL GLOBAL INVESTORS, LLC
	 	 	 
	 	By:	       /s/
    Diane McGuire     
	 	Name:  Diane L. McGuire
	 	Title:    Manager
    – CMBS Loan Servicing
	 	 	 
	 	By:	       /s/
    Joelle L. Palmer
	 	Name:  Joelle L. Palmer
	 	Title:   
    Counsel

 

 CGCMT
2015-P1

Principal
Sub-Servicing Agreement

 

    	 

    	 

    

 

EXHIBIT
A

 

MORTGAGE
LOAN SCHEDULE

 

	Property
                                         Name

         
	Cut-Off
                                         Date 

                                         Balance

         
	Sub-Servicing

                                         Fee %

         

	Piazza
    Carmel	$64,000,000	0.01000%
	Le
    Meridien Dallas by the Galleria	$31,000,000	0.01000%
	Lewis
    Self Storage & Industrial	$30,024,334	0.01000%
	Birch
    Street Promenade	$24,125,000	0.01000%
	Courtyard
    by Marriott Fort Lauderdale	$22,941,246	0.01000%
	Beltway
    Plaza II	$18,500,000	0.01000%
	Bethany
    Village Office	$13,247,875	0.01000%
	Waterway
    Shoppes I	$10,400,000	0.01000%
	Promontory
    Point	$10,218,320	0.01000%
	One
    Industrial Way	$10,000,000	0.01000%
	Best
    Plaza	$9,971,974	0.01000%
	Courtyard
    E Associates	$9,000,000	0.01000%

 

    	A-1

    	 

    

 

	Davis
    Ford Crossing	$33,750,000	0.02000%
	Ryders
    Crossing Shopping Center	$20,300,000	0.03000%
	University
    Town Centre	$55,000,000	0.04000%
	Monarch
    Crossing Apartments	$19,310,000	0.04000%
	240
    N Ashland	$12,500,000	0.04000%
	Mediterranean
    Inn	$10,762,335	0.04000%
	Austin
    Bluffs Shopping Center	$6,284,417	0.04000%

 

    	A-1

    	 

    

 

EXHIBIT
B

 

[RESERVED]

 

    	B-1

    	 

    

 

EXHIBIT
C

 

POOLING
AND SERVICING AGREEMENT

 

Previously
delivered.

 

    	 

    	 

    

 

EXHIBIT
D

 

[RESERVED]

 

    	D-1

    	 

    

 

EXHIBIT
E

 

QUARTERLY
SERVICING CERTIFICATION

 

Sub-Servicer:
                                                                  

 

RE:          Series
CGCMT 2015-P1

 

Pursuant
to the Servicing Agreement(s) between Wells Fargo Bank, National Association and the above referenced Servicer, we certify with
respect to the Mortgage Loans serviced by us for Wells Fargo Bank, National Association that as of the quarter ending ______________________
except as otherwise noted below:

 

	•		All
                                         taxes, assessments and other governmental charges levied against the mortgaged premises,
                                         ground rents payable with respect to the mortgaged premises, if any, which would be delinquent
                                         if not paid, have been paid.

	•		Based
                                         on [Sub-Servicer’s] monitoring of the insurance policies in accordance with the
                                         Servicing Standard, all required insurance policies are in full force and effect on the
                                         mortgaged premises in the form and amount and with the coverage required by the loan
                                         documents.

	•		On
                                         all required insurance policies, the loss payee is in the name of the Trust.

	•		All
                                         necessary action has been taken to continue all UCC Financing Statements in favor of
                                         the originator of each mortgage loan or in favor of any assignee prior to the expiration
                                         of such UCC Financing Statements.

	•		All
                                         reserves are maintained and disbursed in accordance with the loan documents and no obligation
                                         for which a reserve is held has not been completed within the time required by the applicable
                                         document.

	•		To
                                         the best of our knowledge, all letters of credit are transferred to the Trust as beneficiary
                                         and are properly renewed.

	•		Lockboxes
                                         are being serviced in accordance with loan documents.

	•		The Sub-Servicer has notified the Master Servicer in writing within five (5) Business Days after
the Sub-Servicer’s discovery of or receipt of notice alleging a Document Defect or a Breach or the Sub-Servicer’s receipt
of a Repurchase Communication of a Repurchase Request, Repurchase Request Withdrawal, Repurchase or Repurchase Request Rejection.

 

	EXCEPTIONS: 	 
	 	 
	 	 

 

    	E-1

    	 

    

 

	 	 	 
	 	 	 
	Servicing Officer	 	Date

 

    	D-2

    	 

    

    

EXHIBIT
F

 

FORM
OF ACCOUNT CERTIFICATION

 

	Securitization:	 
	 	 
	Sub Servicer:	 

 

	                              New
    Account	                              Change
    of Account Information

 

Indicate purpose of account (check all that apply):

 

	                              Principal
    & Interest	                              Deposit
    Clearing
	                              Taxes
    & Insurance	                              Disbursement
    Clearing
	                              Reserves
    (non-interest bearing)	                              Suspense
	                              Reserves
    (interest bearing)	 

  

	Account Number:	 
	 	 
	Account Name:	 

 

Depository
Institution (and Branch):

 

	 	 Name: 	 
	 	 	 
	 	Street:	 
	 	 	 
	 	City, State, Zip: 	 
	 	 	 
	 	Rating Agency:  	 	 	Rating:	 

 

Please
note that the name of the account must follow the guideline specifications detailed in the applicable agreement.

  

	Prepared by:  	 
	 	 
	Signature: 	 
	 	 
	Title: 	 
	 	 
	Date: 	 
	 	 
	Telephone: 	 	 	Fax:	 	 

 

    	F-1

    	 

    

 

EXHIBIT
G

 

Collection
Report

 

Series
CGCMT 2015-P1

 

Month
of ____________

 

	1	2	3	4	5	6	7	8	9	10	11	12	13	14	15	16	17	18	19	20	21	22	23	24	25	26	27	28	29	30	31	32	33	34	35	36	37	38	39
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Sched

    Addl

    Sub-Sub

    Fee	 

    Neg Am/

    Deferred Int

    Amount	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Sub

    Serv

    ID	Master

    Servicer

    Loan#	Sub-

    Servicer

    Loan#	 

    Prosp

    ID	Sched

    Due

    Date	Begin

    Balance

    Prior to Pmt	Ending

    Balance

    After Pmt	Paid

    Thru

    Date	Current

    Note

    Rate	Sub-

    Servicer

    Fee Rate	Sched

    Prin

    Pmt	Sched

    Int

    Pmt	Sched

    P&I

    Amount	Sched

    Sub-Serv

    Fee	Unsched

    Principal

    Rec’d	Other

    Principal

    Adjust	Other

    Interest

    Adjust	Liq/

    Prepmt

    Date	Prepmt

    Penalty / YM

    Rec’d	Prepmt

    Int

    Exc/Short	Liq/

    Prepmt

    Code	T&I

    Advances

    O/S	Pmt

    Eff Date

    Recd	Actual

    Principal

    Rec’d	Actual
    (Gross)

    Interest

    Rec’d	Actual

    Sub-Servicer

    Fee Paid	Addl

    Sub-Sub

    Fee Paid	Actual
    (Net)

    Interest

    Rec’d	Late

    Charges

    Rec’d	Default

    Interest

    Rec’d	Assum

    Fees

    Rec’d	Addl

    Fees

    Rec’d	 

    Remittance

    Amount	Actual

    Loan

    Balance	Total

    Reserve

    Balance	Pmt

    Loan

    Status	 

     

    Comments
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	0.00
    	0.00
    	0.00
    	0.00
    	0.00
    	0.00
    	0.00
    	0.00
    	0.00
    	 	0.00
    	0.00
    	 	0.00
    	 	0.00
    	0.00
    	0.00
    	 	 	0.00
    	0.00
    	0.00
    	0.00
    	0.00
    	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	NET
    REMIT TO MS	             -   	 	 	 	 

 

    	G-1

    	 

    

 

EXHIBIT
H

 

FORM
OF CERTIFICATE OF INSURANCE

 

	Sub-Servicer:
    	 	 

 

RE:
Series CGCMT 2015-P1

 

Pursuant
to the Sub-Servicing Agreement(s) between Wells Fargo Bank, National Association and the above-named Sub-Servicer, based on [Sub-Servicer’s]
monitoring of the insurance policies in accordance with the Servicing Standard, we certify with respect to the Mortgage Loans
serviced by us for Wells Fargo Bank, National Association that all required insurance policies are in full force and effect on
the mortgaged premises in the form and amount and with the coverage required by the Servicing Agreement(s). Any exceptions are
attached hereto.

 

 

	Servicing Officer	 	 	Date 	 

 

    	H-1

    	 

    

  

EXHIBIT
I

 

NEW
LEASE INFORMATION

 

	Loan #	 	 	Property Type:	 	 		Tenant:	 
	Property Name/Address:	 
	Term (Years, Months):	 	 	 	Sq Ft Gross Rentable:	 	 	 	Net Rentable	 
	Begin Lease Date:	 	 	Retail	 
	End Lease Date:	 	 	Office	 
	Occupancy Date (if diff):	 	 	Other	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

 

	Minimum Rent	 	 	(S/SF/YR)

  

	 	(Mo/Yr) Escalation:	CPI	Other

	 	Change to	on 	 
	 	Change to	on 	 
	 	Change to	on 	 
	 	Change to	on 	 

 

Percentage
Rent

 

	 	 	 	% Rent Due:	 
	 	% Amount	For	 	Monthly
	 	 	For	 	Quarterly
	 	 	Up to	 	Annually
	 	 	Up to	 	 

  

	Breakpoint	(S/Yr)	Sales Report Due:	 

	 	 	 	 	 
	 	 	 	(Mo/Yr)	 
	 	Change to	on 	 	Monthly
	 	Change to	on 	 	Quarterly
	 	Change to	on 	 	Annually

 

Recoveries

 

	Taxes	 	 	Per 	 	 
	Insurance	 	 	Per 	 	 
	Cam	 	 	Per 	 	 
	HVAC	 	 	Per 	 	 
	Adver/Promo	 	 	Per 	 	 
	 	 	 	Per	 	 
	 	 	 	Per	 	 
	Management	 	 	Per	 	 
	 	 	 	 	 	 	 	 

  

    	I-1

    	 

    

  

Renewal
Options 

	 	 	 	 	 	 	 	 	 
	Term	 	 	SF	 
	Minimum rent	 	 	Gross Rentable	 
	% Rent	 	 	Net Rentable	 

 

Landlord
Costs 

	 	 	 	 	 	 
	Alterations: 	 
	Commissions:	 
	Moving Allowances: 	 
	Buyout Clauses: 	 
	Other: 	 

 

Building
Insurance Requirements 

	 
	Tenant maintains fire & ED on building(s);
    will need coverage to renew
	Does not furnish building coverage
	General liability naming landlord mortgagee
    as additional insured; will need coverage for 
	review
	General liability without mentioning landlord’s
    mortgagee; do not need coverage

 

Waiver
of Subrogation

	N/A
	Mutual; will need endorsement
	Landlord only; will need endorsement
	Tenant only; do not need endorsement

Comments:

 

Attachments:

	Original Lease
	Original Subordination Agreement

 

    	I-2

    	 

    

 

EXHIBIT
J

 

QUARTERLY
SERVICING ACCOUNTS CERTIFICATION

 

	 	 	 	 
	Servicer:	 	 	 

  

	 	 	 
	RE:	 	Series CGCMT 2015-P1

 

Pursuant
to the Servicing Agreement(s) between Wells Fargo Bank, National Association and the above named Servicer, I certify with respect
to each transaction serviced by us, as noted above, for Wells Fargo Bank, National Association that as of the last day of the
calendar month immediately preceding the month in which this certificate is dated, all Collection Accounts and Servicing Accounts
have been properly reconciled and the reconciliations have been reviewed and approved by Servicer’s management, except as
otherwise noted below:

	 	 
	EXCEPTIONS: 	 
	 
	 
	 

 

	 	 	 
	 	 	 
	Servicing Officer	 	Date

 

    	J-1

    	 

    

 

EXHIBIT
K

 

FORM
NOTE REGISTER

  

	  HOLDER	  DATE
    

      ACQUIRED	  ADDRESS/WIRE

      INSTRUCTIONS	  PRINCIPAL
    

      AMOUNT	  STATED
    

      INTEREST
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 

 

    	K-1

    	 

    

  

EXHIBIT
L

 

TASK
LIST

 

SERVICER/SUB-SERVICER
TASK LIST (SECURITIZATION)

 

		Note:	Some
                                         listed tasks designate more than one party to perform that function by placing an “X”
                                         in more than one column. In these instances the parties shall follow any specific guidance
                                         about the allocation of responsibilities in completing the task found in the terms of
                                         this Agreement. In the absence of specific allocation of obligations in this Agreement
                                         the parties shall work in good faith to allocate responsibilities in a fair and equitable
                                         manner

 

	 	MASTER
    SERVICER	SUB-SERVICER	CUSTODIAN
	 	 	 	 
	1.  Asset
    Files	 	 	 
	Credit
    file management	X	X	 
	Original
    collateral file (security)	 	 	X
	Authorized
    parties list for request for release of collateral from Custodian	X	 	 
	Provide
    access to servicing files and copies of servicing files or of specific docs upon request to the Servicer	 	X	 
	Request
    delivery of files from Custodian upon request and certification of Sub-Servicer	X	 	 
	 	 	 	 
	2.  Property
    Taxes	 	 	 
	Preparation
    and delivery of quarterly servicing certification regarding taxes	 	X	 
	Monitoring
    of tax status — Loans with/without escrows	 	X	 
	Recommendation
    of payment of taxes — Loans with/without escrows	 	X	 
	Notification
    of advance requirement 3 business days prior to advance being required	 	X	 
	Payment
    of taxes — with sufficient escrows	 	X	 
	Payment
    of taxes — with escrow shortfall	X	 	 
	 	 	 	 
	3.  Property
    Insurance	 	 	 
	Preparation
    and delivery of quarterly servicing certification regarding insurance	 	X	 
	Monitoring
    of insurance status — Loans with/without escrows	 	X	 
	Ensure
    insurance carrier meets applicable qualifications	 	X	 
	Ensure
    insurance in favor of the Servicer	 	X	 
	Recommendation
    of payment or force placement of insurance with/without escrow	 	X	 
	Notification
    of advance requirement or force placement of insurance 3 business days prior to advance being required	 	X	 
	Payment
    of insurance — with sufficient escrows	 	X	 

 

    	L-1

    	 

    

 

	 	MASTER
    SERVICER	SUB-

    SERVICER	CUSTODIAN
	 	 	 	 
	Payment
    of insurance or force placement — with escrow shortfall	X	 	 
	If
    not a Special Servicer Decision or Major Decision	 	 	 
	Preparation
    and presentment of claims	 	X	 
	Collection
    of insurance proceeds	 	X	 
	If
    a Special Servicer Decision or Major Decision	 	 	 
	Preparation
    and presentment of claims	X	 	 
	Collection
    of insurance proceeds	X	 	 
	 	 	 	 
	4.  UCC
    Continuation Filings	 	 	 
	Preparation
    and delivery of quarterly servicing certification regarding UCC’s	 	X	 
	Maintain
    tickler system of refiling the dates on all Loans	 	X	 
	File
    UCC Continuation Statements	 	X	 
	Pay
    recording fees	 	X	 
	Monitor
    tickler system	 	X	 
	 	 	 	 
	5.  Collection/Deposit/Distribution
    of P&I payments and Principal Prepayments	 	 	 
	Collection
    and deposit of loan P&I payments	 	X	 
	Remittance
    of available P&I payments to Servicer and B Note holders, as applicable, net of Sub-Servicing Fee then due and payable
    to Sub-Servicer from such funds	 	X	 
	Provide
    Collection Reports to Servicer	 	X	 
	Approval
    of Prepayment Premiums	X	 	 
	 	 	 	 
	6.  Collection/Deposit/Disbursement
    of Reserves	 	 	 
	Collection
    and deposit of reserves	 	X	 
	Approval
    of Disbursement of Reserves – If not a Special Servicer Decision or Major Decision	 	X	 
	Approval
    of Disbursement of Reserves – If a Special Servicer Decision or Major Decision	X*	 	 
	Disbursement
    of reserves	 	X	 
	 	 	 	 
	7.  Customer
    Billing Collection and Customer Service	 	 	 
	Contact
    delinquent borrowers by phone 3 days after delinquent date	 	X	 
	Send
    30 day delinquent notices	 	X	 
	Send
    notice of balloon payment to each Mortgagor one year, 180, and 90 days prior to the related maturity date	 	X	 

 

 

*    Or Special Servicer if required by Pooling and
Servicing Agreement

 

    	L-2

    	 

    

 

	 	MASTER
    SERVICER	SUB-

    SERVICER	CUSTODIAN
	 	 	 	 
	Provide
    copy of Balloon Mortgage Loan notice to Servicer	 	X	 
	 	 	 	 
	8.  Escrows	 	 	 
	Setup
    and monitor Escrow Accounts including escrow analysis	 	X	 
	Pay
    borrower investment income required, if applicable	 	X	 
	Prepare
    annual escrow analysis	 	X	 
	 	 	 	 
	9.  Loan
    payment history/calculation	 	 	 
	Maintain
    loan payment history	 	X	 
	Create
    payoff/reinstatement statements and telecopy or email to Servicer	 	X	 
	Approve
    payoff calculations and telecopy or email approval to Sub-Servicer promptly (but no later than five (5) Business Days after receipt of request or such later date as necessary to
obtain any consents or approvals required by any related intercreditor or other related agreement)	X	 	 
	 	 	 	 
	10.
    Monitoring     of Financial and Legal Covenants	 	 	 
	Collect
    quarterly and annual operating statements, budgets, rent rolls and borrower financial statements, as applicable	 	X	 
	Deliver
    one (1) copy of quarterly and annual operating statements, budgets, rent rolls and borrower financial statement, as applicable,
    within thirty 30 days of Sub-Servicer’s receipt	 	X	 
	 	 	 	 
	11.
    Borrower     Inquiries/Performing Loans	 	 	 
	Respond
    to routine billing questions	 	X	 
	Assumptions
    & Due on sale:	 	 	 
	Borrower
    contact and data gathering	 	X	 
	Underwriting
    and analysis	 	X	 
	Obtain
    Special Servicer approval of assumption	 	X	 
	Approve
    assumption (if Special Servicer consents)	 	X	 
	Close
    assumption (directly with Borrower)	 	X	 
	Additional
    Liens, Monetary Encumbrances or Mezzanine Financing:	 	 	 
	Borrower
    contact and data gathering	 	X	 

	Underwriting
    and analysis	 	X	 
	Obtain
    Special Servicer approval of additional lien monetary encumbrance or mezzanine financing	 	X	 
	Approve
    additional lien monetary encumbrance or mezzanine financing (if Special Servicer consents)	 	X	 
	Close
    additional lien, monetary encumbrance or mezzanine financing (directly with Borrower)	 	X	 

 

    	L-3

    	 

    

 

	 	MASTER
    SERVICER	SUB-

    SERVICER	CUSTODIAN
	 	 	 	 
	Modifications,
    Waivers, Consents and Extensions (not otherwise provided in this Agreement):	 	 	 
	Borrower
    contact and data gathering	 	X	 
	Underwriting,
    analysis and recommendation	 	X	 
	Approval
    of modification, waivers, consents and extensions (If not a Special Servicer Decision or Major Decision)	 	X	 
	Obtain
    any necessary Special Servicer approval of modification, waiver, consent and extensions (If a Special Servicer Decision or
    Major Decision) and copy the Master Servicer on correspondence to the Special Servicer	 	X	 
	Approve
    modification, waiver, consent and extensions (If a Special Servicer Decision or Major Decision)	X†	 	 
	Closing
    Documents and Closing	 	X	 
	Response
    to request for Discounted Payoffs, Workouts, Restructures, Forbearances and Casualties	X	 	 
	Condemnation
    (only with respect to Specially Serviced Mortgage Loans the Servicer will perform such functions)	X	X	 
	 	 	 	 
	12. Reports
    due at or following Closing 	 	 	 
	Account
    Certifications (Exhibit F) - at Closing	 	X	 
	Certificate
    of Insurance (Exhibit H) – 30 days after execution	 	X	 
	Initial
    CREFC Loan Setup File	X	 	 
	Initial
    CREFC Property File	X	 	 
	Initial
    CREFC Comparative Financial Status Report	X	 	 
	 	 	 	 
	13. Monthly
    Reporting 	 	 	 
	•      CREFC Reports (CREFC Property File, CREFC Servicer Watch List, CREFC Comparative Financial Status Report, CREFC Loan Level
    Reserve/LOC Report and CREFC Total Loan Report)	 	X	 
	•      Day One Report	 	X	 
	•      Collection Report	 	X	 
	 	 	 	 
	14.  Quarterly
    Reporting	 	 	 
	•      Quarterly Servicing Account (Exhibit J)	 	X	 
	•      Quarterly Servicing Certification (Exhibit E)	 	X	 
	•      CREFC NOI Adjustment Worksheet	 	X	 

 

 

†    Or Special Servicer if required by Pooling and
Servicing Agreement

 

    	L-4

    	 

    

 

	 	MASTER
    SERVICER	SUB-

    SERVICER	CUSTODIAN
	 	 	 	 
	•      CREFC
    Operating Statement Analysis Report	 	X	 
	 	 	 	 
	15. Release
    of Collateral	 	 	 
	Borrower
    contact and data gathering	 	X	 
	Underwriting,
    analysis and recommendation	 	X	 
	Approval
    of Release (If not a Special Servicer Decision or Major Decision)	 	X	 
	Obtain
    any necessary Special Servicer approval of Release (If a Special Servicer Decision or Major Decision) and copy the Master
    Servicer on correspondence to the Special Servicer	 	X	 
	Approve
    Release (If a Special Servicer Decision or Major Decision)	X‡	 	 
	Request
    delivery of files from Custodian	X	 	 
	Preparation
    and recordation of release deeds all Loans (full and partial)	 	X	 
	 	 	 	 
	16. Property
    Annual Inspections	 	 	 
	Conduct
    site inspection	 	X	 
	Deliver
    copy of site inspection to Master Servicer within 30 days of inspection but not later than December 15 of each year 	 	X	 
	 	 	 	 
	17.   Preparation
    of IRS Reporting (l098s and 1099s or other tax reporting requirements) by January 31 of each year.  Provide copy
    to Servicer upon request	 	X	 
	 	 	 	 
	18.   Provide
    annual statement of compliance at the times and in the manner set forth in Section 3.01(c)(37) of this Agreement	 	X	 
	 	 	 	 
	19.   Provide
    a report regarding Sub-Servicers assessment of compliance with servicing criteria and a report by a registered public accounting
    firm that attests to and reports on such assessment report at the times in the manner and as specified in Section 3.01(c)(37)
    of this Agreement	 	X	 
	 	 	 	 
	20. Compensation	 	 	 
	Sub-Servicer
    Fee and other fees payable to the Sub-Servicer by the B Note holders or the holders of the Serviced Companion Mortgage Loans	 	X	 
	Investment
    earnings on Sub-Servicer Collection Account	 	X	 
	Investment
    earnings on tax & insurance reserves not payable to borrower	 	X	 
	Investment
    earnings on reserve accounts not payable to borrower	 	X	 

 

 

‡    Or Special Servicer if required by Pooling and
Servicing Agreement

 

    	L-5

    	 

    

 

	 	MASTER
    SERVICER	SUB-

    SERVICER	CUSTODIAN
	 	 	 	 
	Default
    Charges to the extent collected from borrower 	X	 	 
	Fees
    for late submission of financials to the extent collected from the borrower	 	X	 
	 	 	 	 
	21. Defeasance
    	 	 	 
	Coordinate,
    analyze and process defeasance request	 	X	 
	Provide
    to Servicer certificate re satisfaction of defeasance requirements	 	X	 
	Service
    Defeasance Loans	 	X	 
	Retain
    all processing fees associated with a defeasance 	 	X	 

 

    	L-6Stock Purchase Agreement

 

STOCK PURCHASE AGREEMENT

THIS STOCK PURCHASE AGREEMENT (this “Agreement”) is made and entered into as of July ___, 2015 (the “Effective Date”) by and among JANIS M. TILFORD (the “Shareholder”), the sole shareholder of the Company, TILFORD, INC., a South Carolina corporation (the “Company”) and TNH ACQUISITION, LLC, a Georgia limited liability company (“Purchaser”).

WITNESSETH:

WHEREAS, the Shareholder owns the number of shares of common stock of the Company set forth opposite her name on Exhibit “A” which shares in the aggregate represent one hundred percent (100%) of the issued and outstanding capital stock of the Company (the “Stock”); and

WHEREAS, the Company owns certain land, buildings, improvements, furniture, fixtures and equipment comprising a skilled nursing facility located at 117 Bellefield Road, Ridgeway, South Carolina 29130 consisting of two buildings containing 68 licensed beds and 44 licensed beds, and certain property on the other side of Bellefield Road comprising a spray  field for treated wastewater  (the “Facility”); and

WHEREAS, the Company owns various equipment, inventories and other assets related to the operation of the Facility; and

WHEREAS, the Facility is leased to Fairfield Home, LLC, a South Carolina limited liability company (“Tenant”) pursuant to a certain oral month to month lease agreement (the “Lease”); and

WHEREAS, Shareholder desires to sell her entire right, title and interest in and to the Stock to Purchaser, and Purchaser desires to purchase Shareholder’s entire right, title and interest in and to the Stock from Shareholder, subject to and upon the terms and conditions hereinafter set forth.

NOW, THEREFORE, in consideration of the mutual covenants herein contained and other good and valuable consideration, the mutual receipt and legal sufficiency of which are hereby acknowledged, the parties, intending to be legally bound, hereby agree as follows:

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ARTICLE 1

DEFINITIONS

1.1

Capitalized Terms.  Capitalized terms used in this Agreement shall have the meanings set forth below or in the section of this Agreement referred to below.  Such terms, as so defined, shall include in the singular, the plural, and in the plural, the singular.

“Agreement”  shall mean this Stock Purchase Agreement, together with all Schedules and Exhibits attached hereto, as it and they may be amended from time to time as herein provided.

“Business Day”  shall mean any day other than a Saturday, Sunday or any other day on which banking institutions in the State of South Carolina are authorized by law or executive action to close.

“Closing”  shall mean the closing of the transaction contemplated by this Agreement.

“Closing Date”  shall mean the first day of the month following the month in which Purchaser (or its designated operator) obtains all required licenses from the State of South Carolina to operate the Facility but no later than September 30, 2015, or if extended by Purchaser pursuant to Section 2.2 hereof, no later than October 31, 2015.

“Contracts”  shall mean all of the Company’s service contracts, equipment leases, booking agreements, warranties and guaranties, and other arrangements or agreements which relate exclusively to the ownership, repair, maintenance, management, leasing or operation of the Facility.

“Deposit”  shall mean the amount of Fifty Thousand and 00/100s Dollars ($50,000.00) deposited by Purchaser with Escrow Agent simultaneously with the entering hereof, and, if the Closing Date is extended until October 31, 2015 by the Purchaser pursuant to Section 2.2 hereof an additional of Fifty Thousand and 00/100s Dollars ($50,000.00) such that, in such event the Deposit shall mean One Hundred Thousand and No/100ths Dollars ($100,000.00) .

 “Escrow Agent”  shall mean Hughes White Kralicek, P.C. as agent for the Title Company.

“Environmental Law”  shall mean the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, including the Superfund Amendments and Reauthorization Act of 1986 (42 U.S.C. Sections 9601 et seq.), the Resource Conservation and Recovery Act of 1976 (42 U.S.C. Section 6901 et seq.), the Clean Water Act (33 U.S.C. Sections 466 et seq.), the Safe Drinking Water Act Sections 1401 (14 U.S.C. Section 1450), the Hazardous Materials Transportation Act (79 U.S.C. Sections 1801 et seq.), the Toxic Substances Control Act (15 U.S.C. Sections 2601-2629) and any other federal, state, or local law, regulation, or ordinance regarding environmental conditions or hazards.

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“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended.

“FF&E”  shall mean, collectively, all appliances, machinery, devices, fixtures, equipment (including, without limitation, all kitchen equipment), furniture, furnishings, partitions, signs or trade fixtures or other tangible personal property owned by the Company and located at the Facility.

 “Hazardous Substance”  shall mean any chemical, substance, material, object, condition, or waste harmful to human health or safety or to the environment due to its radioactivity, ignitability, corrosivity, reactivity, explosivity, toxicity, carcinogenicity, infectiousness, or other harmful or potentially harmful properties or effects, including, without limitation, petroleum or petroleum products, and all of those chemicals, substances, materials, objects, conditions, wastes, or combinations of them which are now or become listed, defined or regulated in any manner by any Environmental Law. 

“Improvements”  shall mean, collectively, all buildings and other structures and improvements situated on, affixed or appurtenant to the Land on which the Facility is located.

“Inspection Period”  shall mean the period beginning on the Effective Date and expiring at 5:00 p.m. eastern time on the thirtieth (30th) day after the Effective Date.

 “Land”  shall mean the parcel or parcels of land described on Exhibit “B” attached hereto on which the Facility is located, together with all appurtenances thereto.  The Land shall include sufficient real property located across Bellefield Road from the real property upon which the Improvements are located, to comprise and constitute an adequate spray field (the “Spray Field”) for wastewater generated from use and occupancy of the Facility and its Improvements. Shareholder shall at her expense have a survey prepared separating the Spray Field from the balance of the real property (and improvements thereto, if any, collectively the “Balance”) and convey the said Balance to the Shareholder or a third party prior to Closing.  The Balance is not and shall not be a part of the Facility and will not be owned by the Company at Closing. 

“Purchase Price”  shall mean Three Million and 00/100s Dollars ($3,000,000.00).

 “Real Property”  shall mean, collectively, the Land and the Improvements related to the Facility.

“Seller shall mean the Shareholder.

“Tax Code”  shall mean the Internal Revenue Code of 1986 and, to the extent applicable, the Treasury Regulations promulgated thereunder, each as from time to time amended.

“Title Company”  shall mean Chicago Title Insurance Company or such other reputable national title insurance company as may be selected by Purchaser.

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ARTICLE 2

PURCHASE AND SALE; CLOSING

2.1

Purchase and Sale.  In consideration of the payment of the Purchase Price by Purchaser to Shareholder and for other good and valuable consideration, Shareholder hereby agrees to sell to Purchaser, and Purchaser hereby agrees to purchase from Shareholder, all of Shareholder’s right, title and interest in and to the Stock for the Purchase Price, subject to and in accordance with the terms and conditions of this Agreement.

2.2

Closing.  If the closing conditions in Article 4 and Article 5 are satisfied, the purchase and sale of the Stock shall be consummated on the Closing Date by the release of the documents and funds held in escrow by the Escrow Agent.  Purchaser shall have the right at any time prior to September 30, 2015, to extend the Closing Date to October 31, 2015 upon written notice to Shareholder and simultaneous deposit of an additional $50,000.00 with Escrow Agent (which, together with the initial deposit of $50,000.00 shall then comprise the Deposit as herein defined)..  

2.3

Purchase Price.   The aggregate purchase price to be paid for the Stock shall be the Purchase Price.  The Purchase Price shall be paid as follows:

(a)

Deposit.  Within three (3) Business Days following the Effective Date, Purchaser shall deposit the Initial Deposit of $50,000.00 with the Escrow Agent by wire transfer of immediately available funds.

(b)

Cash Consideration.  The sum of Three Million and 00/100s Dollars ($3,000,000.00) (including the Deposit), subject to adjustment as provided in Article 9, shall be deposited into escrow with the Escrow Agent by wire transfer of immediately available funds and released to Shareholder at the Closing.

2.4

Duties of Escrow Agent.

(a)

Holding of Deposit.  The Escrow Agent shall hold the Deposit in a non-interest bearing account and shall pay the Deposit to the party entitled thereto in accordance with the terms of this Agreement.

(b)

IRS Stock Sales Reporting.  The Escrow Agent shall act as “the person responsible for closing” the transactions contemplated hereby pursuant to Section 6045(e) of the Tax Code, and the Escrow Agent shall prepare and file all informational returns, including IRS Form 1099-B, and shall otherwise comply with the provisions of said Section 6045(e).

(c)

Escrow Agreement.  Simultaneously with the execution and delivery of this Agreement, Seller, Purchaser and Escrow Agent shall execute and deliver an escrow agreement in the form attached hereto as Exhibit “C”.

(d)

(d)

CPL.  Prior to execution and delivery of the Escrow Agreement Escrow Agent shall deliver to Shareholder and Purchaser a Closing Protection Letter issued by the Title Company, addressed to the Shareholder and Purchaser and assuring each of them of performance of the duties of the Escrow Agent, by Escrow Agent.

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ARTICLE 3

DILIGENCE

3.1

Inspections and Other Diligence Activities.

(a)

Property Inspections.  During the Inspection Period and thereafter until the Closing or the earlier termination of this Agreement, the Company shall permit Purchaser and its representatives to conduct non-invasive physical inspections of the Real Property and the Facility; provided, however, Purchaser shall not be permitted to perform any environmental investigations or invasive testing which are beyond the scope of typical so-called “Phase I” investigation without the Company’s prior written consent, which consent shall not be unreasonably withheld or delayed.   Except for the administrator of the Facility (whom Purchaser may contact), Purchaser shall not contact any employees or any residents of the Facility without the Company’s prior written consent.  All such inspections shall be performed in a manner consistent with this Agreement and so as to minimize any interference or disruptions to the residents or the operations of the Facility.  Purchaser shall notify the Company at least one (1) Business Day prior to making any such inspections.  For purposes of the preceding sentence only, notice may be given by e-mail to Janis M. Tilford at jmpbt@bellsouth.net with a copy to Austin Sheheen at ASheheen@shgcpa.com. 

(b)

Diligence Materials.  From and after the Effective Date until the Closing or the earlier termination of this Agreement, Shareholder shall deliver to Purchaser for Purchaser’s review true, correct and complete copies of any materials pertaining to the Real Property, the Facility and/or the Company that are reasonably requested by Purchaser to the extent such materials are within Shareholder’s possession or control.  

3.2

Termination of Agreement.  Purchaser shall have the right to terminate this Agreement at any time prior to the expiration of the Inspection Period by giving written notice thereof to the Company and Shareholder (with a copy to Escrow Agent), in which event the Escrow Agent shall return the Deposit to Purchaser and neither party shall have any further rights or obligations hereunder; provided, however, in such event Purchaser shall be liable for, and shall pay to Company the costs of repairs, if any necessitated or caused by Purchaser’s inspection of the Real Property and the Facility pursuant to Section 3.1(a).

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3.3

Title and Survey.  Within five (5) Business Days following the Effective Date, the Company shall deliver to Purchaser copies of the most recent title policies and surveys of the Real Property that are in the Company’s possession or control (if any).  Purchaser shall have the right to obtain new or updated title commitments and/or surveys for the Real Property and Purchaser shall provide copies of any such updates to the Company within five (5) Business Days after its receipt thereof.  At least ten (10) Business Days prior to the expiration of the Inspection Period, Purchaser shall give the Company notice of any title exceptions or other matters set forth on the Company’s title policies or surveys or any updates thereof as to which Purchaser objects in its sole and absolute discretion.  The Company shall have the right, but not the obligation, to remove, satisfy or otherwise cure any such exception or other matter as to which Purchaser so objects. If the Company is unable or unwilling to take such actions as may be required to cure such objections, the Company shall give Purchaser notice thereof; it being understood and agreed that the failure of the Company to give such notice within three (3) Business Days after its receipt of Purchaser’s notice of objection shall be deemed an election by the Company not to remedy such matters.  If the Company shall be unable or unwilling to remove any title defects to which Purchaser has so objected, Purchaser shall elect either (a) to terminate this Agreement (in whole but not in part) or (b) to proceed to Closing notwithstanding such title defect without any abatement or reduction in the Purchase Price on account thereof.  Purchaser shall make any such election by written notice to the Company given on or prior to the expiration of the Inspection Period; provided, however, if the Company commences to cure a title defect and then elects not to complete such cure, Purchaser shall have the right to terminate this Agreement by written notice to the Company within three (3) Business Days after the Company notifies Purchaser thereof.  The failure of Purchaser to give such notice shall be deemed an election by Purchaser to proceed to Closing in accordance with clause (b) above.  

3.4

Confidentiality.  Purchaser shall not disclose or otherwise use any data or other information concerning the Company or the Facility for any purpose other than for evaluating the transaction contemplated hereunder in the course of its due diligence as provided herein, and Purchaser shall keep all such data and information strictly confidential.  Notwithstanding the foregoing, the Company acknowledges that Purchaser may disclose such data and information by furnishing copies thereof to third party consultants in the normal course of Purchaser’s due diligence provided that such consultants agree to be bound by the terms and conditions of this Section 3.4.

3.5

Return of Materials.  If the Closing does not take place as herein contemplated for any reason, Purchaser shall promptly return all materials delivered to it by the Company pursuant to this Agreement. 

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ARTICLE 4

CONDITIONS TO PURCHASER’S OBLIGATION TO CLOSE

The obligation of Purchaser to acquire the Stock shall be subject to the satisfaction of the following conditions precedent on and as of the Closing Date:

4.1

Closing Documents.  The Company shall have delivered to Escrow Agent and shall have authorized and directed Escrow Agent to record or release to Purchaser (as applicable) the following:

(a)

Stock Transfer Power.  A stock transfer power duly executed by Shareholder conveying the Stock to Purchaser substantially in the form of Exhibit “D”.

(b)

Settlement Statement.  A settlement statement showing the Purchase Price and all adjustment thereto in accordance with the terms and conditions of this Agreement, which settlement statement shall be in a form and substance reasonably satisfactory to Shareholder and Purchaser, duly executed by Shareholder.

(c)

Title Affidavits.  Such usual and customary affidavits as the Title Company may reasonably require, including, without limitation, a so-called owner’s affidavit in such form as will permit the Title Company to issue its title policy without exceptions for parties-in-possession or mechanic’s liens.

(d)

Termination of the  Lease and Management Agreement.  Termination agreements for the Lease and Management Agreement in form and substance acceptable to Purchaser shall be executed and delivered to Purchaser.

(e)

Operations Transfer Agreement.  An operations transfer agreement in form and substance acceptable to Purchaser and/or its designated operator executed on behalf of Tenant. 

(f)

Other Conveyance Documents.  Such other conveyance documents and instruments as Purchaser or the Title Company may reasonably require and as are consistent with this Agreement and are customary in like transactions in the State of South Carolina.

4.2

Representations and Warranties.  All representations and warranties of Shareholder and the Company herein shall be true, correct and complete in all material respects on and as of the Closing Date, and Shareholder and the Company shall certify in writing at such Closing that each of such representations and warranties are true, correct and complete in all material respects on and as of the Closing Date.

4.3

Covenants.  Shareholder and the Company shall have performed in all material respects all covenants and obligations required to be performed by the Company and/or Shareholder on or before the Closing Date.

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4.4

Condition of the Facility.  The Facility shall, on the Closing Date, be in substantially the same condition as it was on the Effective Date, normal wear and tear excepted; provided, however, if a casualty or condemnation occurs with respect to the Facility, Article 10 shall govern the rights and obligations of the parties hereunder.

4.5

Title Policy.  The Title Company shall be committed, subject only to payment of its usual and customary premium at the Closing, to issue a title policy insuring that fee simple title to the Real Property on which the Facility is located is vested in the Company.

4.6

Accounts Payable.  At or prior to the Closing, the Company shall have paid in full all of the Company’s accounts payable, including, without limitation, (i) principal and interest owed with respect to any debt secured by a mortgage on the Real Property, (ii) real property, personal property and income taxes and (iii) amounts owed under any Contracts.   

ARTICLE 5

CONDITIONS TO SHAREHOLDER’S OBLIGATION TO CLOSE

The obligation of Shareholder to convey the Stock to Purchaser is subject to the satisfaction of the following conditions precedent on and as of the Closing Date:

5.1

Purchase Price.  Purchaser shall have delivered the Purchase Price to Escrow Agent and shall have authorized and directed Escrow Agent to pay the same to Shareholder.

5.2

Closing Documents.  Purchaser shall have delivered to Escrow Agent duly executed and acknowledged counterparts of the documents described in Article 4, where applicable, and shall have authorized and directed Escrow Agent to release the same to Purchaser.

5.3

Representations and Warranties.  All representations and warranties of Purchaser herein shall be true, correct and complete in all material respects on and as of the Closing Date, and Purchaser shall certify in writing at the Closing that each of the representations and warranties made by Purchaser herein are true, correct and complete in all material respects on and as of the Closing Date.

5.4

Purchaser’s Covenants.  Purchaser shall have performed in all material respects all covenants and obligations required to be performed by Purchaser on or before the Closing Date.

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ARTICLE 6

REPRESENTATIONS AND WARRANTIES OF SHAREHOLDER AND COMPANY 

6.1

Representations and Warranties. To induce Purchaser to enter into this Agreement, Shareholder and the Company jointly and severally represent and warrant to Purchaser as follows:

(a)

Status and Authority.  The Company is a corporation duly formed, validly existing and in good standing under the laws of its state of formation, and has all requisite power and authority under the laws of such state and its charter documents to enter into and perform its obligations under this Agreement and to consummate the transactions contemplated hereby and thereby.

(b)

Action.  The Company has taken (or will have taken prior to Closing) all necessary action to authorize the execution, delivery and performance of this Agreement and upon the execution and delivery of this Agreement and/or any document to be delivered by the Company hereunder or thereunder, this Agreement and such documents shall constitute the valid and binding obligations and agreements of the Company, enforceable against the Company in accordance with their respective terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws of general application affecting the rights and remedies of creditors.

(c)

No Violations of Agreements.  Neither the execution, delivery or performance of this Agreement by the Company or Shareholder, nor compliance with the terms and provisions hereof, will result in any breach of the terms, conditions or provisions of, or conflict with or constitute a default under, or result in the creation of any lien, charge or encumbrance upon the Company pursuant to the terms of any indenture, mortgage, deed of trust, note, evidence of indebtedness or any other agreement or instrument by which the Company or Shareholder is bound.

(d)

Litigation.  There are no pending investigations, actions or proceedings which questions the validity of this Agreement or any action taken or to be taken pursuant hereto or thereto.  The Company has not received any written notice regarding any pending or threatened litigation or administrative proceedings which could reasonably be expected to materially adversely affect the Company or the Facility or the Company’s right to enter into this Agreement or to consummate the transactions contemplated by this Agreement.  The Company is not subject to any judgment, order, writ, injunction, decree or award of any court, arbitrator or governmental department, agency, board, bureau or instrumentality issued or entered in a proceeding to which the Company or the Facility is or was a party.

(e)

Notices of Violation.  Except as otherwise disclosed to Purchaser in writing, as of the Effective Date, the Company has not received any written notice from any governmental authority claiming that the Company and/or the Facility is in material violation of any applicable law, code, rule, regulation, ordinance, license or permit (including, without limitation, any Environmental Law).

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(f)

Hazardous Substances.  The Company has not unlawfully used, generated, transported, treated, constructed, deposited, stored, disposed, placed or located at, on, under or from the Real Property any flammable explosives, radioactive materials, hazardous or toxic substances, materials or wastes, pollutants or contaminants defined, listed or regulated by any applicable local, state or federal environmental laws in material violation of any such environmental laws where such violation could reasonably be expected to have an material adverse effect on the Facility.

(g)

Power and Authority of Shareholder.  Shareholder has the right, power and capacity to execute, deliver and perform this Agreement and the other agreements contemplated herein to which Shareholder is a party (collectively, the “Shareholder Transaction Agreements”) and to consummate the transactions contemplated hereby.  This Agreement has been duly and validly executed and delivered by Shareholder and constitutes Shareholder’s legal, valid and binding obligation, enforceable against Shareholder in accordance with its terms, except as enforceability may be limited by applicable equitable principles or by bankruptcy, insolvency, reorganization, moratorium, or similar laws affecting, creditors’ rights generally, and by the exercise of judicial discretion in accordance with equitable principles.

(h)

No Conflict.  The execution and delivery of this Agreement by Shareholder, the consummation of the transactions contemplated herein by Shareholder, and the performance of the covenants and agreements of Shareholder, will not, with or without the giving of notice or the lapse of time, or both, (a) violate, conflict with or result in a breach or default under or cause termination of any term or condition of any mortgage, indenture, contract, license, permit, instrument, trust document, or other agreement, document or instrument to which Shareholder is a party or by which Shareholder or any of her properties may be bound; or (b) violate any provision of any law or any order or any legal requirement, to which Shareholder is a party or by which Shareholder or her properties may be bound.

(i)

Ownership of the Stock.  Shareholder owns, of record and beneficially, good and valid title to the Stock in the amount set forth next to Shareholder’s name on Exhibit “A” and such shares of Stock (a) are validly issued, fully paid and nonassessable, and (b) are free and clear of any liens, with no defects of title whatsoever and constitute one hundred percent (100%) of the issued and outstanding shares of the Company.  Other than the shares of Stock, Shareholder owns no shares of capital stock of the Company or any other equity security of the Company and no right of any kind to have any such equity security issued.  Upon the Closing, Purchaser shall have obtained good and valid title to the Stock free and clear of any liens, and with no defects of title whatsoever.  Shareholder has full and exclusive power, right and authority to vote the shares of Stock. Shareholder is not a party to or bound by any agreement affecting or relating to Shareholder’s right to transfer (including any right of first refusal) or vote the shares, and Shareholder is not a party to any contract, agreement or understanding that obligates the Company to repurchase, redeem or otherwise acquire any shares of capital stock or other securities of the Company.

(j)

Required Consents.  No consent, approval, authorization, or action by any third party or governmental body is required in connection with the execution and delivery by Shareholder of this Agreement or the consummation by Shareholder of the transactions contemplated herein.

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(k)

Absence of Other Claims.  No prior offer, issue, redemption, call, purchase, sale, merger, transfer, involvement in any transfer, negotiation or other transaction of any nature or kind with respect to any capital stock (including shares, offers, options, warrants, or debt convertible into shares, options or warrants) of the Company owned by Shareholder has given or may give rise to (a) any valid claim or action by any person (including, without limitation, any former or present holder of any of the shares of stock owned by Shareholder); or (b) and, to the knowledge of Shareholder, no fact or circumstance exists which could give rise to any such right, claim, action or interest on behalf of any person.

(l)

Litigation and Absence of Undisclosed Liabilities; Current Investigation.  There are no claims, charges, arbitrations, actions, suits, proceedings, or investigations pending or, to the knowledge of Shareholder, threatened against, relating to Shareholder, at law or in equity, or before or by any governmental body, which will prevent Shareholder from consummating the transactions contemplated by this Agreement.

(m)

Disclosure.  No representation or warranty or other statement made by Shareholder or the Company in this Agreement omits to state a material fact necessary to make any of them, in light of the circumstances in which it was made, not misleading.

(n)

Authority.

(i)

The Company has the right, legal capacity, full power and authority to enter into this Agreement and the other agreements contemplated herein to which the Company is a party (the “Company Transaction Agreements”) and to perform its obligations hereunder and thereunder and to consummate the transactions contemplated herein and thereby.  This Agreement has been duly and validly executed and delivered by the Company. 

(ii)

Neither the execution or delivery of this Agreement, nor the consummation or performance by the Company or Shareholder of any of the transactions contemplated hereby will, directly or indirectly (with or without notice or lapse of time or both):

(A)

violate the Articles of Incorporation, Bylaws or other governing documents of the Company;

 (B)

violate, contravene or conflict with any provisions of law or any order or legal requirement to which the Company or Shareholder is subject or by which the Company, Shareholder, the Stock or any of the properties or assets of the Company may be bound or give any governmental body or other person the right to challenge any of the contemplated transactions or to exercise any remedy or obtain any relief under, any order or legal requirement to which the Company, Shareholder, the Stock or any of the properties or assets of the Company may be subject, except as would not, individually or in the aggregate, result in a material adverse effect;

(o)

Personal Property.

(i)

Schedule 6.1(p)(i) sets forth a complete and accurate list and description of all the personal property that the Company owns, has agreed (or has an option) to purchase, sell or lease, or may be obligated to purchase, sell or lease.

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(ii)

The Company (i) has good and valid title to all the personal and mixed, tangible and intangible properties and assets which it purports to own or which it uses in the conduct of its business (except for inventory); and (ii) owns such personal property free and clear of all liens of any nature whatsoever, including any mortgages, leases, chattel mortgages, conditional sales contracts, collateral, security arrangements and other title or interest retention arrangements.  All properties and assets of the Company are in the possession of the Company.  

(p)

Leases. Schedule 6.1(q) contains a complete and accurate list of all leases pursuant to which the Company leases personal property from others.  The Company has made available to Purchaser true, correct and complete copies of such leases.

(q)

Contractual Obligations.

(i)

Schedule 6.1(r)(i) sets forth a true, correct, and complete list of all Contracts. 

(ii)

Each Contract is in full force and effect and there are not now any existing defaults or events of default, real or claimed with respect to the Company and the other parties thereto, or events which with notice or lapse of time or both would constitute defaults, the consequence of which, severally or in the aggregate, would have a material adverse effect on the Company.  The Contracts are valid and enforceable in accordance with their respective terms with respect to the Company and, to the Company’s knowledge, each other party thereto, except as enforceability may be limited by applicable equitable principles or by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally, and to the exercise of judicial discretion in accordance with general equitable principles.  There exists no actual or, to the Company’s knowledge, threatened, termination, cancellation, or limitation of, or any amendment, modification, or change to, any Contract that would have a material adverse effect on the company.  The Company has made available to Purchaser true, correct and complete copies of all Contracts.

(r)

Indebtedness.  Schedule 6.1(s) sets forth a true, correct and complete list and description of all instruments or other documents relating to any direct or indirect indebtedness for borrowed money of the Company, as well as indebtedness by way of lease-purchase arrangements, guarantees, undertakings on which others rely in extending credit and all conditional sales contracts, chattel mortgages and other security arrangements with respect to personal property used or owned by the Company. The Company has made available to Purchaser a true, correct and complete copy of each of the items required to be listed on Schedule 6.1(s).

(s)

Licenses and Permits.  Schedule 6.1(t) contains a complete and accurate list of each license and permit that is held by the Company.  

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(t)

Taxes.  The Company has timely filed, and as of the Closing Date will have timely filed, all federal income tax returns, and all material state, county and local income, franchise, property, sales, use, and other tax returns relating to the Company required to be filed on or prior to the Closing Date, and such returns are and will be true and correct in all material respects.  The Company has paid, or by the Closing Date will have paid, all federal, state, county and local income, franchise, property, sales, use and all other taxes and assessments (including penalties and interest in respect thereof, if any) that have become or are due with respect to the Company regarding any period ended on or prior to the Closing Date whether shown on such returns or not.  No tax liens have been filed against the properties or assets of the Company or the Facility and, to the knowledge of the Company, no claim for any additional tax or assessment is being asserted against the Company in connection therewith by any taxing authority.  All taxes required to be withheld on or prior to the Closing Date from employees of the Company for income taxes, social security taxes and other employment taxes have been properly withheld, in all material respects, and, if required on or prior to the Closing Date, have been deposited with the appropriate governmental body. 

(u)

Financial Statements.  Schedule 6.1(v) contains the compiled balance sheets and statements of income of the Company as of December 31, 2014, and the compiled balance sheet of the Company as of December 31, 2014, and the related statement of income for the period then ended (collectively, the “Financial Statements”).  The Financial Statements are, in all material respects, true, correct and complete and present fairly the financial position of the Company as of the dates thereof, and the related results of its operations for the years then ended.  The compiled balance sheet as of _____________, 2015 (the “Interim Balance Sheet Date”) included in the Financial Statements is referred to herein as the “Interim Balance Sheet.” The Financial Statements are compilations that have been prepared on an income tax basis of accounting in accordance with the books and records of the Company, applied on a consistent basis throughout the periods indicated, except that the Interim Balance Sheet is subject to normal year-end adjustments.

(v)

No Undisclosed Liabilities.  Except as and to the extent reflected and adequately reserved against in the Interim Balance Sheet, liabilities and obligations incurred by the Company in the ordinary course of business, the Company had no material liability or obligation whatsoever, whether accrued, absolute, contingent or otherwise.

(w)

Employees; Labor Matters.

(i)

Schedule 6.1(x) sets forth the names and current compensation (broken down by category, e.g., salary, bonus, commission) of all employees of the Company, together with the date and amount of the last increase in compensation for each such person.  

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(ii)

To the Company’s knowledge, each foreign national employee of the Company is authorized to be present and employed in the United States.  The Company is in compliance in all material respects with all Laws, Orders, and Legal Requirements relating to the regulation of foreign nationals in the United States including, without limitation, those items relating to the employment and compensation of foreign nationals in the United States.  Moreover, there are no unresolved past, pending or, to the Company’s knowledge, threatened administrative, regulatory or judicial actions, proceedings, investigations, obligations, liabilities, losses, decrees, judgments, penalties, fines, fees, demands, demand letters, orders, directives, claims, or notices of noncompliance or violation relating in any way to the Company or its operations in connection with the Company’s employment of foreign nationals.  As used herein, the term “foreign national” means a person who is not a citizen of the United States of America.

(iii)

The Company, within the last three (3) years, has not experienced any slowdown, work interruption, strike, or work stoppage.  The Company is not a party to and has no obligation pursuant to, any oral or written agreement, collective bargaining or otherwise, with any party regarding the rates of pay or working conditions of any of its employees nor is the Company obligated under any agreement to recognize or bargain with any labor organization or union on behalf of such employees.  Neither the Company, nor any member of the governing body of the Company, nor any of the Company’s officers or employees, has been charged or threatened in writing with the charge of any unfair labor practice.  The Company is in compliance in all material respects with all applicable legal requirements concerning the employer-employee relationship in respect of its employees.  The Company has paid, or will pay in a timely manner, any wages, bonuses, or commissions required to be paid to its employees for all services performed by them to the Closing Date.  The Company does not have any employment contract, consulting agreement (other than the management agreement between Fairfield Home, LLC, the tenant of the Facility, and Laurel Baye Healthcare, LLC, to provide management for the Facility, the “Management Agreement”), termination or severance agreement, salary continuation agreement, change of control agreement or any other contract or other agreement, including offers for any of the above, respecting the terms and conditions of employment or payment of compensation to any current or former employee or other service provider of the Company.  To the knowledge of the Company, no employee of the Company is a party to, or is otherwise bound by, any contract, agreement or arrangement between such employee and any other person that in any way adversely affects or will affect the performance of such Person’s duties as an employee of the Company.

(iv)

Schedule 6.1(dd)(x) sets forth the name and title of each director and officer of the Company.  The sole director of the Company receives compensation from the Company for services as a director or officer of the Company.

(v)

All persons classified by the Company as independent contractors have been properly classified in accordance with all applicable legal requirements and no such person is eligible to participate in any Company benefit plan or would be eligible to participate if the Company’s classification of such person as an independent contractor is subsequently determined to be incorrect.  The Company has not received in writing a claim from any governmental body to the effect that the Company has improperly classified any person as an independent contractor, nor to the knowledge of the Company has any such claim been threatened.

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(x)

Employee Benefits.  

(i)

All Company benefit plans are listed on Schedule 6.1(y).   The Company does not maintain, nor in the last five (5) years has it maintained or contributed to, any Company benefit plan.  Each Company benefit plan has been administered in compliance in all material respects with the applicable provisions of ERISA, the Tax Code and other applicable Governmental Regulations.  Each Company benefit plan which is intended to be qualified within the meaning of the Tax Code §401(a) is so qualified and has received a determination, opinion or advisory letter from the Internal Revenue Service upon which it may rely regarding its qualified status and nothing has occurred, whether by action or failure to act, that could cause the loss of such qualification.  No Company benefit plan is or has ever been subject to Title IV of ERISA, Section 412 of the Tax Code or Section 302 of ERISA, and neither Shareholder nor any ERISA Affiliate have incurred any liability under Title IV of ERISA.  No Company benefit plan provides or promises to provide employee welfare benefits (as defined in ERISA §3(1)) to any current or former employee or his or her family members beyond termination of service or retirement, other than coverage mandated by law.  To the Company’s knowledge, there have been no prohibited transactions or other fiduciary breaches with respect to any Company benefit plan.  No action or investigation with respect to any Company benefit plan or any trustees or fiduciaries thereof (other than routine claims for benefits) is pending or, to the Company’s knowledge, threatened and no completed action or investigation has resulted in the imposition of any tax or penalty.  Each “nonqualified deferred compensation plan” subject to the Tax Code §409A is either exempt from coverage by the Tax Code §409A or complies with the Tax Code §409A and has been operated and timely amended since January 1, 2005 in good faith compliance with the Tax Code §409A and all applicable guidance issued thereunder.

(ii) 

The Company has never been a member of an affiliated service group under the Tax Code Section 414(m) and is not a party to an employee leasing arrangement covered by the Tax Code Section 414(n).

(iii)

The Company has made available to Purchaser:  (i) copies of all material documents setting forth the terms of each Company benefit plan, including all amendments thereto and all related trust documents; (ii) the three most recent annual reports (Form Series 5500), if any, required under ERISA or the Tax Code in connection with each Company benefit plan; (iii) the most recent summary plan description, if any, required under ERISA with respect to each Company benefit plan; (iv) all material written contracts, instruments or agreements relating to each Company benefit plan, including administrative service agreements and group insurance contracts; (v) the most recent IRS determination or opinion letter issued with respect to each Company benefit plan intended to be qualified under Section 401(a) of the Tax Code; (vi) all documents relating to any governmental audit of a Company benefit plan; and (vii) all filings under the IRS’ Employee Plans Compliance Resolution System Program or any of its predecessors or the U.S. Department of Labor Delinquent Filer Program or Voluntary Fiduciary Correction Program.

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(iv)

All payments required by each Company benefit plan with respect to all prior periods have been made or provided for by the Company in accordance with the provisions of the Company benefit plan, applicable law and generally accepted accounting principles.  The consummation of the transactions described herein (i) will not cause Purchaser or any of its ERISA Affiliates to incur or suffer any liability, contingent or otherwise, relating to any Company benefit plan, and (ii) will not cause, alone or in combination with other events, the acceleration of payment of vesting of any benefit under a Company benefit plan.

(y)

Insurance Policies.  Schedule 6.1(z) sets forth a complete and accurate list and description of all insurance policies in force naming the Company, or any employees thereof in their capacity as such, as an insured or beneficiary or as a loss payable payee, or for which the Company has paid or is obligated to pay all or part of the premiums.  The Company has not received notice of any pending or threatened termination or premium increase (retroactive or otherwise) with respect thereto, and the Company is in material compliance with all conditions contained therein.  There have been no lapses (whether cured or not) in the coverage provided under the insurance policies, during the term of such policies, as extended or renewed.  The Company has made available to Purchaser true, correct and complete copies of each of the policies required to be listed on Schedule 6.1(z).

6.2

Knowledge Defined.  All references in this Agreement to “the Company’s knowledge” or words of similar import shall refer to the actual knowledge of Janis M. Tilford.

6.3

Survival.  The representations and warranties made in this Agreement by the Company shall be continuing and shall be deemed remade as of the Closing Date, with the same force and effect as if made on, and as of, such date, subject to the Company’s right to update such representations and warranties by written notice to Purchaser prior to the Closing Date.  All representations and warranties made in this Agreement by the Company and Shareholder shall survive the Closing for a period of two (2) years.  Purchaser must notify the Company and Shareholder of any alleged breach of any representation on or before the day preceding the second anniversary of the Closing Date, and no action or proceeding may be commenced against the Company for any breach of any representation or warranty after the day preceding the second anniversary of the Closing Date.

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6.4

AS-IS.

  EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS AGREEMENT, SHAREHOLDER AND THE COMPANY HAVE NOT MADE, AND PURCHASER HAS NOT RELIED UPON, ANY INFORMATION, PROMISE, REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, REGARDING THE COMPANY OR THE FACILITY, INCLUDING, WITHOUT LIMITATION, ANY INFORMATION, PROMISE, REPRESENTATION OR WARRANTY REGARDING THE PHYSICAL CONDITION OR VALUE OF THE FACILITY, TITLE TO OR THE BOUNDARIES OF ANY OF THE REAL PROPERTY, PEST CONTROL MATTERS, SOIL CONDITIONS, THE PRESENCE, EXISTENCE OR ABSENCE OF HAZARDOUS SUBSTANCES, TOXIC SUBSTANCES OR OTHER ENVIRONMENTAL MATTERS, COMPLIANCE WITH BUILDING, HEALTH, SAFETY, LAND USE AND ZONING LAWS, REGULATIONS AND ORDERS, STRUCTURAL AND OTHER ENGINEERING CHARACTERISTICS, TRAFFIC PATTERNS, MARKET DATA, ECONOMIC CONDITIONS OR PROJECTIONS, AND ANY OTHER INFORMATION PERTAINING TO THE FACILITY OR THE MARKET AND PHYSICAL ENVIRONMENT IN WHICH IT MAY BE LOCATED AND SELLER EXPRESSLY DISCLAIMS ALL WARRANTIES RELEVANT TO THE COMPANY OR THE FACILITY, EITHER EXPRESS OR IMPLIED, INCLUDING MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, AND SUITABILITY FOR ITS INTENDED USE.  PURCHASER ACKNOWLEDGES THAT (A) PURCHASER IS A SOPHISTICATED OWNER OF FACILITY SIMILAR TO THE FACILITY, (B) PURCHASER HAS ENTERED INTO THIS AGREEMENT WITH THE INTENTION OF MAKING AND RELYING UPON ITS OWN INVESTIGATION OR THAT OF THIRD PARTIES WITH RESPECT TO THE PHYSICAL, ENVIRONMENTAL, ECONOMIC AND LEGAL CONDITION OF THE COMPANY AND THE FACILITY AND (C) PURCHASER IS NOT RELYING UPON ANY STATEMENTS, REPRESENTATIONS OR WARRANTIES OF ANY KIND, AND IS ACQUIRING THE FACILITY IN “AS IS, WHERE IS” CONDITION, EXCEPT AS SPECIFICALLY SET FORTH IN THIS AGREEMENT.

ARTICLE 7

REPRESENTATIONS AND WARRANTIES OF PURCHASER

7.1

Representations of Purchaser.  To induce the Company and Shareholder to enter in this Agreement, Purchaser represents and warrants to the Company and Shareholder as follows:

(a)

Status and Authority of Purchaser.  Purchaser is a limited liability company duly formed, validly existing and in good standing under the laws of its state of formation, and has all requisite power and authority under the laws of such state and its charter documents to enter into and perform its obligations under this Agreement and to consummate the transactions contemplated hereby and thereby.

(b)

Action of Purchaser, Etc.  Purchaser has taken (or will have taken prior to Closing) all necessary action to authorize the execution, delivery and performance of this Agreement and upon the execution and delivery of this Agreement and/or any document to be delivered by Purchaser hereunder or thereunder, this Agreement and such documents shall 

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constitute the valid and binding obligations and agreements of Purchaser, enforceable against Purchaser in accordance with their respective terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws of general application affecting the rights and remedies of creditors.

(c)

Purchase of Unregistered Stock.  Purchaser specifically warrants, acknowledges and agrees that (i)  the Stock is being purchased for Purchaser’s sole and exclusive use, and not with an eye to resale or further transfer of the Stock; (ii) Purchaser is knowledgeable and sophisticated in the business of the Company and is not relying upon any expertise or representation of the Shareholder; (iii) Purchaser was not solicited nor did Purchaser learn of the availability of the Stock for purchase through any broker or any public or published solicitation or offer; (iv) Purchaser intends to manage and operate the Company and is not looking to the efforts of the Shareholder or any third party; (v) Purchaser has had access to all books, records and information with respect to the Company as Purchaser has deemed necessary or relevant in determining the value and worth of the Stock, and is not relying upon any representation (other than as expressly set forth herein) of Shareholder or anyone acting for or on behalf of Shareholder; and (vi) the Stock has not been registered for sale under, pursuant to or with respect to any offering, public or private, and accordingly all certificates evidencing or representing the Stock or any shares thereof will and must bear the following language, to wit:

"The shares represented by this certificate were issued by the corporation pursuant to exemptions from registration under both federal and South Carolina securities laws, rules and regulations.  Such exemptions may prohibit certain transfers of these shares.  Therefore, none of the shares (nor any interest in such shares) may be transferred in any manner whatsoever (either voluntarily or involuntarily, directly or indirectly, by pledge, sale, gift, levy, or any other attempted method of transfer) without the prior written consent of the shareholder(s) of the corporation that such transfer is permitted, or the prior written opinion of an attorney licensed to practice law in South Carolina who was appointed in writing by the shareholder(s) of the corporation to render such opinion, that such transfer is permitted."

(d)

No Violations of Agreements.  Neither the execution, delivery or performance of this Agreement by Purchaser, nor compliance with the terms and provisions hereof, will result in any breach of the terms, conditions or provisions of, or conflict with or constitute a default under, or result in the creation of any lien, charge or encumbrance upon the property or assets of Purchaser pursuant to the terms of any indenture, mortgage, deed of trust, note, evidence of indebtedness or any other agreement or instrument by which Purchaser is bound.

(e)

Litigation.  No investigation, action or proceeding is pending and, to Purchaser’s knowledge, no action or proceeding is threatened and no investigation looking toward such an action or proceeding has begun, which questions the validity of this Agreement or any action taken or to be taken pursuant hereto or thereto.

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7.2

Survival.  The representations and warranties made in this Agreement by Purchaser shall be continuing and shall be deemed remade as of the Closing Date, with the same force and effect as if made on, and as of, such date.  All representations and warranties made in this Agreement by Purchaser shall survive the Closing for a period of two (2) years.  The Company or Shareholder must notify Purchaser of any alleged breach of any representation on or before the day preceding the second anniversary of the Closing Date, and no action or proceeding may be commenced against Purchaser for any breach of any representation or warranty after the day preceding the second anniversary of the Closing Date.

ARTICLE 8

COVENANTS

8.1

Covenants.  The Company and Shareholder hereby covenant with Purchaser between the Effective Date and the Closing Date as follows:

(a)

Material Agreements.  Not to enter into, modify, amend or terminate any material agreement which would encumber or be binding upon the Company from and after the Closing Date, without in each instance obtaining the prior written consent of Purchaser, which consent may be withheld in Purchaser’s sole and absolute discretion.

(b)

Ownership of Facility.  To continue to own the Facility in a good and businesslike fashion consistent with past practices; provided, however, notwithstanding anything to the contrary contained in this Article 8 or elsewhere in this Agreement, it is expressly understood and agreed that the Company shall not have any obligation to make any capital expenditure with respect to the Facility.

ARTICLE 9

APPORTIONMENTS

9.1

Apportionments.

(a)

Prorations.  The following items for the Company and the Real Property shall be apportioned at the Closing as of 11:59 p.m. on the day immediately preceding the Closing Date:

(i)

real estate taxes and assessments other than special assessments, based on the rates and assessed valuation applicable in the fiscal year for which assessed;

(ii)

municipal assessments and governmental license and permit fees;

(iii)

amounts payable under financing or equipment leases affecting personal property; and

(iv)

all other items of income and expense normally apportioned in sales of similar properties.

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If any of the foregoing cannot be apportioned at the Closing because of the unavailability of the amounts which are to be apportioned, such items shall be apportioned on the basis of a good faith estimate by the parties and reconciled as soon as practicable after the Closing Date but, in any event, no later than forty-five (45) days after the Closing Date.

(b)

Net Adjustments.  If a net amount is owed by the Company to Purchaser pursuant to this Section 9.1, such amount shall be credited against the Purchase Price.  If a net amount is owed by Purchaser to Shareholder pursuant to this Section 9.1, such amount shall be added to the Purchase Price.

(c)

Accounts and Cash On Hand.  All cash (“Cash”) on hand (including, without limitation, monies, checks received (whether deposited or to be deposited) and federal funds wire transfers and electronic wire transfers in transit or placed) on or before 11:59 p.m. on the day immediately preceding the Closing Date, and all accounts receivable (including, without limitation, unbilled work in progress) (“Accounts”) accruing on or before 11:59 p.m. on the day immediately preceding the Closing Date (the “Effective Time”) shall be the sole property of and belong to the Shareholder.  All Accounts accruing after 11:59 p.m. on the day immediately preceding the Closing Date shall be the sole property of and belong to the Purchaser.  Each of the parties agrees to provide reasonable assistance and at no cost to the other to assure timely payment to the party(ies) entitled thereto of all such Cash and Accounts, and that all funds so collected or received belonging to or for another party shall be received as trust funds and paid over as promptly as reasonably possible to the party(ies) entitled thereto, together with copies of all accountings and reports with respect thereto.  Payments received by Purchaser after the Effective Time with respect to the Facility from third party payors, such as the Medicare Program, the Medicaid Program, the Veteran’s Administration, or managed care companies or health maintenance organizations, shall be handled as follows:

(i)

If the accompanying remittance advice indicates, or if the parties agree, that the payments relate solely to periods prior to the Effective Time, then (A) in the event that such payments are received by Purchaser, Purchaser shall as promptly as reasonably possible pay over such payments to Shareholder (but in any event, not later than ten (10) business days following the receipt of such payment, and until so deposited, shall be held in trust for the benefit of Shareholder) and (B) in the event that such payments are received by Shareholder, Shareholder shall retain the payments.

(ii)

If the accompanying remittance advice indicates, or if the parties agree, that the payments relate solely to periods after the Effective Time, then (A) in the event that such payments are received by Purchaser, Purchaser shall retain the payments and (B) in the event that such payments are received by Shareholder, Shareholder shall promptly forward such payments to Purchaser (but in any event, not later than ten (10) business days following the receipt of such payment, and until so forwarded, shall be held in trust for the benefit of Purchaser);

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(iii)

If the accompanying remittance advice indicates, or if the parties agree, that the payments relate to periods both prior to and after the Effective Time, then, (A) if such payment is received by Purchaser, Purchaser shall promptly pay the amount of such payment relating to periods prior to the Effective Time to Shareholder (but in any event, not later than ten (10) business days following the receipt of such payment), and (B) if such payment is received by Shareholder, Shareholder shall promptly pay the amount of such payment relating to periods following the Effective Time to Purchaser (but in any event, not later than ten (10) business days following the receipt of such payment).  

(iv)

If the accompanying remittance advice does not indicate the period to which a payment relates or if there is no accompanying remittance advice and if the parties do not otherwise agree as to how to apply such payment, then any such payments received during the first ninety (90) days after the Effective Time shall be applied first to the payor’s pre-Effective Time balances and any remaining portion shall be applied to such payor’s post-Effective Time balance and any such payments received following the first ninety (90) days after the Effective Time shall be first applied to such payor’s post-Effective Time balances.  

9.2

Closing Costs.

(a)

Purchaser’s Closing Costs.  Purchaser shall pay the following costs in connection with the consummation of the Closing: (i) the premium charges for title policies and all of the charges for any endorsements thereto and (ii) all other charges incurred by Purchaser in connection with this Agreement (including, without limitation, the fees and expenses of Purchaser’s attorneys and other consultants).

(b)

Shareholder’s Closing Costs. The Shareholder shall pay the following costs in connection with the consummation of the Closing: (i) all commissions owed to any broker in accordance with the terms of a separate agreement between the Company and/or Shareholder and such broker; and (ii) all other charges incurred by the Shareholder in connection with this Agreement (including, without limitation, the fees and expenses for the Shareholder’s attorneys and other consultants).

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ARTICLE 10

DAMAGE TO OR CONDEMNATION OF PROPERTY

10.1

Casualty.  If, prior to the Closing, all or any material part of the Facility is destroyed or materially damaged by fire or other casualty, the Company shall promptly notify Purchaser of such fact.  In such event, Purchaser shall have the right to terminate this Agreement (in whole but not in part) by giving notice thereof to the Company not later than ten (10) days after receiving the Company’s notice (and, if necessary, the Closing Date shall be extended until the second Business Day after the expiration of such ten-day period).  If Purchaser elects to terminate this Agreement as aforesaid, this Agreement shall terminate and be of no further force and effect, the Deposit shall be returned to Purchaser, and no party shall have any rights or obligations hereunder.  If less than a material part of the Facility shall be affected or if Purchaser shall not elect to terminate this Agreement as aforesaid, there shall be no abatement of the Purchase Price and the Company shall assign to Purchaser at the Closing all of the Company’s right, title and interest in and to the proceeds, if any, under the Company’s insurance policies covering such property with respect to such damage or destruction and there shall be credited against the Purchase Price the amount of any applicable deductible.

10.2

Condemnation.  If, prior to the Closing, all or any material part of the Facility is taken by eminent domain (or becomes the subject of a pending taking which has not yet been consummated), the Company shall notify Purchaser of such fact promptly after obtaining knowledge thereof and Purchaser shall have the right to terminate this Agreement (in whole but not in part) by giving notice thereof to the Company not later than ten (10) days after the giving of the Company’s notice (and, if necessary, the Closing Date shall be extended until the second day after the expiration of such ten-day period).  If Purchaser elects to terminate this Agreement as aforesaid, whereupon, this Agreement shall terminate and be of no further force and effect, the Deposit shall be returned to Purchaser, and no party shall have any rights or obligations hereunder.  If less than a material part of the Facility shall be affected or if Purchaser shall not elect to terminate this Agreement as aforesaid, the sale of the Stock shall be consummated as herein provided without any adjustment to the Purchase Price (except to the extent of any condemnation award received by the Company prior to the Closing) and the Company shall assign to Purchaser at the Closing all of the Company’s right, title and interest in and to all awards, if any, for the taking, and Purchaser shall be entitled to receive and keep all awards for the taking of the Facility or portion thereof.

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ARTICLE 11

INDEMNIFICATION AND DEFAULT

11.1

Indemnification.  The Shareholder hereby indemnifies and holds Purchaser harmless against and in respect of any and all liability, damage, loss, cost, and expenses arising out of or otherwise in respect of: (a) any misrepresentation, breach of warranty, or non-fulfillment of any agreement or covenant made by the Company and/or Shareholder in this Agreement; (b) the ownership of the Real Property and Facility prior to the Closing Date including, without limitation, all liabilities of the Company required to be paid at Closing pursuant to Section 4.9 hereof; (c) any and all actions, suits, proceedings, audits, judgments, costs, and legal and other expenses incident to any of the foregoing or to the enforcement of this Section 11.1.

11.2

Purchaser’s Indemnification.  Purchaser hereby defends, indemnifies and holds the Company and Shareholder harmless against and in respect of any and all liability, damage, loss, cost, and expenses arising out of or otherwise in respect of: (a) any misrepresentation or breach of warranty contained in this Agreement; (b) the ownership of the Real Property and Facility on and after the Closing Date; (c) any and all actions, suits, proceedings, audits, judgments, costs, and legal and other expenses incident to any of the foregoing or to the enforcement of this Section 11.2.

11.3

Default by the Company or Shareholder.  If, on or prior to the Closing, the Company or Shareholder shall have made any representation or warranty herein which shall be untrue or misleading in any material respect, or if the Company or Shareholder shall fail to perform any of the material covenants and agreements contained herein to be performed by the Company or Shareholder, Purchaser may, as its sole and exclusive remedy at law or in equity, elect to either (a) terminate this Agreement and receive the Deposit or (b) pursue a suit for specific performance.

11.4

Default by Purchaser.  If, on or prior to Closing, Purchaser shall have made any representation or warranty herein which shall be untrue or misleading in any material respect, or if Purchaser shall fail to perform any of the covenants and agreements contained herein to be performed by it, the Company or Shareholder, as their sole and exclusive remedy at law or in equity, may terminate this Agreement and receive the Deposit.

ARTICLE 12

MISCELLANEOUS

12.1

Brokers.  Except as disclosed on Schedule 12.1 hereto neither party has dealt with any broker, finder or like agent in connection with this Agreement or the transactions contemplated hereby.  Each party shall indemnify, defend and hold harmless the other parties from and against any loss, liability or expense, including, without limitation, reasonable attorneys’ fees, arising out of any claim or claims for commissions or other compensation for bringing about this Agreement or the transactions contemplated hereby made by any other broker, finder or like agent, if such claim or claims are based in whole or in part on dealings with the indemnifying party.

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12.2

Notices.

(a)

Form of Notices.  Any and all notices, demands, consents, approvals, offers, elections and other communications required or permitted under this Agreement may be given by the attorneys of the parties and shall be deemed adequately given if in writing.  All such notices shall be delivered either in hand, by facsimile with written confirmation of transmission, by electronic mail (email) or by mail or Federal Express or similar expedited commercial carrier, addressed to the recipient of the notice, postpaid and registered or certified with return receipt requested (if by mail), or with all freight charges prepaid (if by Federal Express or similar carrier).  Timing of Notices.  All notices shall be deemed to have been given for all purposes of this Agreement upon the date of receipt or refusal, except that whenever under this Agreement a notice is either received on a day which is not a Business Day or is required to be delivered on or before a specific day which is not a Business Day, the day of receipt or required delivery shall automatically be extended to the next Business Day.  For purposes of any notice given by facsimile, the date of receipt shall be the date of transmission (as confirmed by electronic confirmation of transmission generated by the sender’s machine).

(b)

Notice Addresses.  All such notices shall be addressed,

If to the Company, 

or Shareholder to:

Tilford, Inc.

1709 Mill Street

Camden, S.C. 29020

Attn: Janis M. Tilford

Email: jmpbt@bellsouth.net

with a copy to:

Donald W. Tyler, Esq

Tyler, Cassell, Jackson, Peace & Silver, LLC

1331 Elmwood Avenue, Suite 300

Post Office Box 11656 (postal zip code 29211-1656)

Columbia, S.C. 29201

Email: dtyler@tcjps.com

And with a copy to:

Austin M. Sheheen, Jr.

Sheheen, Hancock & Godwin, LLP

1011 Fair Street

Post Office Drawer 428

Camden, SC 29021

Email: ASheheen@shgcpa.com 

If to Purchaser, to:

TNH Acquisition, LLC

Two Buckhead Plaza

3050 Peachtree Street, NW, Suite 355

Atlanta, Georgia 30339

Attn: Christopher F. Brogdon

Email: cfbrogdon@winterhavenhomesinc.com

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with a copy to:

Gregory P. Youra, Esq.

Holt Ney Zatcoff & Wasserman, LLP

100 Galleria Pkwy, Suite 1800

Atlanta, Georgia 30339

Facsimile:  (770) 956-1490

Email: gyoura@hnzw.com 

If to Escrow Agent, to:

Gregory D. Hughes, Esq.

Suite 570 South 

2300 Windy Ridge Parkway

Atlanta, Georgia 30339

Facsimile No.:  (770) 955-0049

Email: ghughes@hughesandwhite.com

(c)

Change of Notice Addresses.  By notice given as herein provided, the parties hereto shall have the right from time to time and at any time to change their respective addresses to any other address within the United States of America effective upon receipt by the other parties of such notice.

12.3

Waivers.  Any waiver of any term or condition of this Agreement, or of the breach of any covenant, representation or warranty contained herein, in any one instance, shall not operate as or be deemed to be or construed as a further or continuing waiver of any other breach of such term, condition, covenant, representation or warranty or any other term, condition, covenant, representation or warranty, nor shall any failure at any time or times to enforce or require performance of any provision hereof operate as a waiver of or affect in any manner such party’s right at a later time to enforce or require performance of such provision or any other provision hereof.  

12.4

Amendments.  This Agreement may not be amended, nor shall any waiver, change, modification, consent or discharge be effected, except by an instrument in writing executed by or on behalf of the party against whom enforcement of any amendment, waiver, change, modification, consent or discharge is sought.

12.5

Assignment; Successors and Assigns.  This Agreement and all rights and obligations hereunder shall not be assignable by Purchaser without the prior written consent of the Company, except that Purchaser may assign this Agreement to an affiliated entity upon not less than three (3) Business Days’ prior notice to the Company.  This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective legal representatives, successors and permitted assigns.  This Agreement is not intended and shall not be construed to create any rights in or to be enforceable in any part by any other persons or entities.

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12.6

Severability.  If any provision of this Agreement shall be held or deemed to be, or shall in fact be, invalid, inoperative or unenforceable as applied to any particular case in any jurisdiction or jurisdictions, or in all jurisdictions or in all cases, because of the conflict of any provision with any constitution or statute or rule of public policy or for any other reason, such circumstance shall not have the effect of rendering the provision or provisions in question invalid, inoperative or unenforceable in any other jurisdiction or in any other case or circumstance or of rendering any other provision or provisions herein contained invalid, inoperative or unenforceable to the extent that such other provisions are not themselves actually in conflict with such constitution, statute or rule of public policy, but this Agreement shall be reformed and construed in any such jurisdiction or case as if such invalid, inoperative or unenforceable provision had never been contained herein and such provision reformed so that it would be valid, operative and enforceable to the maximum extent permitted in such jurisdiction or in such case.

12.7

Counterparts, Etc.  This Agreement may be executed in one (1) or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.  Any such counterparts or signatures may be delivered by facsimile or e-mail (in .pdf format), and any counterparts or signatures so delivered shall be deemed an original counterpart or signature for all purposes related to this Agreement.

12.8

Integration.  This Agreement and the documents referenced herein constitute the entire agreement of the parties hereto with respect to the subject matter hereof and shall supersede and take the place of any other instruments purporting to be an agreement of the parties hereto relating to the subject matter hereof.

12.9

Attorneys’ Fees.  Notwithstanding anything contained herein to the contrary, if any lawsuit or arbitration or other legal proceeding arises in connection with the interpretation or enforcement of this Agreement, the prevailing party therein shall be entitled to receive from the other party the prevailing party’s costs and expenses, including reasonable attorneys’ fees incurred in connection therewith, in preparation therefor and on appeal therefrom, which amounts shall be included in any judgment therein.

12.10

Section and Other Headings.  The headings contained in this Agreement are for reference purposes only and shall not in any way affect the meaning or interpretation of this Agreement.

12.11

No Presumption Against Drafter.  This Agreement has been extensively negotiated between the Company and Purchaser and none of the provisions set forth herein shall be construed narrowly against either party on the account of the fact that such party (or its attorney) drafted such provision.

12.12

Time of Essence.  Time shall be of the essence with respect to the performance of each and every covenant and obligation, and the giving of all notices, under this Agreement.

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12.13

Performance on Business Days.  In the event the date on which performance or payment of any obligation of a party required hereunder is other than a Business Day, the time for payment or performance shall automatically be extended to the first Business Day following such date.

12.14

Governing Law.  This Agreement shall be interpreted, construed, applied and enforced in accordance with the laws of the State of South Carolina.

12.15

Survival.  The provisions of this Article 12 shall survive the Closing hereunder.

[Signatures on Following Page]

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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed as of the date first above written.

THE COMPANY:

TILFORD, INC., 

a South Carolina corporation 

By:

___________________________

Name:

Janis M. Tilford

Title:

President

SHAREHOLDER: 

_________________________________

Janis M. Tilford

PURCHASER:

TNH Acquisition, LLC,

a Georgia limited liability company

By:_____________________________

Name: Christopher F. Brogdon

Title: Manager

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EXHIBIT “A”

			
	SHAREHOLDER

	NUMBER OF

SHARES OWNED

	OWNERSHIP

PERCENTAGE 

	Janis M. Tilford

	__________

	100.0%

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EXHIBIT “B”

LEGAL DESCRIPTION

 

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EXHIBIT “C”

ESCROW AGREEMENT

THIS ESCROW AGREEMENT (hereinafter referred to as “Escrow Agreement”) is made and entered into as of ______________ ___, 2015 (the “Effective Date”) by and among (i) the JANIS M. TILFORD (the “Shareholder”), (ii) TILFORD, INC., a South Carolina corporation (the “Company”) (iii) TNH ACQUISITION, LLC, a Georgia limited liability company (“Purchaser”) and (iv) GREGORY D. HUGHES, ESQUIRE, (hereinafter referred to as “Escrow Agent”).

WHEREAS, Seller and Purchaser have entered into a Stock Purchase Agreement (“Stock Purchase Agreement”) dated as of _____________, 2015 for the purchase and sale of all issued and outstanding share of stock of the Company, the sole asset of which consists of a skilled nursing Facility located at 117 Bellefield Road, Ridgeway, South Carolina 29130 consisting of 68 licensed beds and 44 licensed beds; and

WHEREAS, Purchaser and Seller desire to have Escrow Agent hold certain earnest money funds in escrow as required under the Stock Purchase Agreement pursuant to the terms hereof;

NOW, THEREFORE, in consideration of the premises and for other good and valuable consideration, the receipt and sufficiency whereof are hereby acknowledged, the parties hereto covenant and agree as follows:

Seller and Purchaser hereby appoint Hughes, Gregory D. Hughes, Esq.  as Escrow Agent hereunder.

Purchaser has, or will, deposit and deliver to Escrow Agent a wire transfer in the amount of Fifty Thousand and NO/100 Dollars ($50,000.00) (the “Earnest Money”) representing the Earnest Money due under the Stock Purchase Agreement.  Additional monies may be deposited with Escrow Agent as may be provided in the Stock Purchase Agreement, all of which are to be held and disbursed as provided herein.

Escrow Agent agrees to deposit the funds in a non-interest bearing Georgia IOLTA  attorney’s escrow account and to hold and disburse the funds as herein provided.  Notwithstanding anything to the contrary contained in the Stock Purchase Agreement, the undersigned hereby agree that the disposition of the Earnest Money shall be solely governed by this Escrow Agreement.

Upon written notification from Purchaser and Seller that the contemplated sale is to be consummated, or in the alternative, that the contemplated sale shall not take place, Escrow Agent shall deliver the Earnest Money as jointly instructed by the parties, assuming said written instructions are mutually compatible.  In the event of a dispute between any of the parties hereto sufficient in the sole discretion of Escrow Agent to justify its doing so, Escrow Agent shall be entitled to tender into the registry or custody of any court of competent jurisdiction all money or property in its hands held under the terms of this Escrow Agreement, together with such legal pleadings as it deems appropriate, and thereupon be discharged.  Escrow Agent shall be fully indemnified by the parties hereto for all his expenses, costs, and attorney's fees incurred in 

HNZW/513844_8.doc/4232-17

 

  

connection with any interpleader action which Escrow Agent may file, in its sole discretion, to resolve any dispute as to the Deposit, or which may be filed against the Escrow Agent.  Escrow Agent's estimate of such costs, expenses or attorney's fees, may be deducted from the Deposit, and the parties hereby authorize and direct Escrow Agent to sever said estimate from the Deposit and acknowledge and agree that the interpleaded amount shall be the Deposit minus said estimate.  The undersigned parties hereby agree that upon a final judgment of any action with regard to a dispute as to the Deposit, Escrow Agent shall be reimbursed from the corpus of the amount interpleaded for any costs, expenses or attorney's fees in excess of the said severed and retained estimate, and will remit to the parties to the action any excess amount remaining after payment of all Escrow Agent's costs, expenses and attorney's fees, in accordance with any directive contained within the final judgment.  The undersigned Purchaser and Seller hereby consent to the Superior Court of Cobb County, Georgia, as the venue for said interpleader action, or any other civil action with regard to this Agreement.

The parties hereto covenant and agree that in performing any of its duties under this Escrow Agreement, Escrow Agent shall not be liable for any loss, costs or damage which it may incur as a result of serving as Escrow Agent hereunder, except for any loss, costs or damage arising out of its sole default or negligence.

Accordingly, Escrow Agent shall not incur any liability with respect to (i) any action taken or omitted to be taken in good faith upon advice of its counsel given with respect to any questions relating to its duties and responsibilities or (ii) any action taken or omitted to be taken in reliance upon any document, including any written notice of instruction provided in this Escrow Agreement, not only as to its due execution and the validity and effectiveness of its provisions, but also the truth and accuracy of any information contained therein, which Escrow Agent shall in good faith believe to be genuine, to have been signed or presented by a proper person or persons and to conform with the provisions of this Escrow Agreement.  Escrow Agent shall not incur any liability for any loss or fund due to bank or other depository failure, suspension or cessation of business or any action or inaction on the part of the bank or other depository.  Escrow Agent is specifically authorized to refuse to act except upon the written instructions of Purchaser and Seller.

Purchaser and Seller hereby agree to indemnify and hold harmless Escrow Agent against any and all losses, claims, damages, liabilities and expenses, including without limitation, cost of investigation and attorneys’ fees and disbursements which may be imposed upon or incurred by Escrow Agent in connection with its serving as Escrow Agent hereunder.

If Purchaser should subsequently deliver any additional Earnest Money to Escrow Agent in connection with the sale contemplated by this Escrow Agreement, Escrow Agent shall hold such additional Earnest Money under the terms of this Escrow Agreement, unless instructed otherwise in writing by the parties.

[Signatures are set forth on the immediately following page.]

HNZW/513844_8.doc/4232-17

 

  

 

IN WITNESS WHEREOF, the undersigned have caused this instrument to be duly 

executed as of the day and year first above written.

THE COMPANY:

TILFORD, INC., 

a South Carolina corporation 

By:

___________________________

Name:

___________________________

Title:

___________________________

SHAREHOLDER: 

_________________________________

Janis M. Tilford

 

PURCHASER:

TNH ACQUISITION, LLC,

a Georgia limited liability company

By:_____________________________

Name: Christopher F. Brogdon

Title: Manager

ESCROW AGENT:

_________________________________

Gregory D. Hughes, Esq. 

Date:_____________________________

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EXHIBIT “D”

STOCK TRANSFER POWER

For value received, _______________, an individual resident of the State of ____________, does hereby sell, assign and transfer unto Global Acquisition, LLC, a Georgia limited liability company, ____________ (____) shares of stock of Tilford, Inc., a South Carolina corporation (the “Company”), standing in its name on the books of said Company represented by Certificate No. __,  and does hereby irrevocably Constitute and appoint _______________________ as the undersigned’s true and lawful attorney with full powers of substitution, to sell, assign and transfer said stock on the books of the Company and for that purpose to make and execute all necessary acts of assignment and transfer thereof.

Dated this __ day of ___________, 2015.

Shareholder: 

 ____________________________

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SCHEDULE 12.1

BROKERS

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