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Originations and Underwriting Product Overview Brex’s monthly statement charge card product is a non-revolving corporate charge card targeted to small and medium sized businesses with a credit limit based on a company’s cash balance and real-time transaction monitoring.The charge card has embedded financial tools such as expense management, spend controls, and integrated connectivity for reconciliation through Customers’ accounting software. Brex has focused on a target Customer base of growing and newly formed businesses, with high cash balances and limited operating and corporate credit history. Brex’s monthly statement charge card Customers are underwritten on the basis of their ability and willingness to repay, and Customer limits are set relative to their available cash balance. Customers are given dynamic limits, which will periodically update relative to their available cash balance and transactions. During their onboarding, Customers link an active bank or cash management account either through a financial data aggregator or by using a cash management account offered through Brex that can be automatically linked. Brex has built and utilizes software to monitor Customers’ available cash balance and business transactions in real-time, facilitating dynamic credit limit setting based on actual Customer performance. Customers are required to pay their outstanding balance in full at the end of each monthly statement period. On statement due dates, Brex automatically collects any balance due directly from Customers’ bank accounts using ACH and does not rely on Customers to pay their balance manually. Customers can prepay their balance at any time. Brex does not currently offer grace periods, and all statement balances must be paid in full on their due date. Brex does not charge interest on unpaid balances and does not charge late fees. Customers with unpaid, past-due statements are unable to make additional purchases with their card until they become current. Brex Commercial Charge Card Master Trust Series 2022-1 14 March 30, 2022 Features of the charge card program are outlined in the table below. Program Features Description Credit Limit Adjustment Period Evaluated as often as daily Billing Cycle Period One month Billing Cycle Payment Frequency Minimum one time per billing cycle Interest rate type None Due Date Final day of billing cycle period Late Fees None Customer Acquisition Brex acquires Customers from three primary channels: ▪ Business Development - comprised of affiliate partnerships, referral channels, professional networks, and investor communities. ▪ Marketing - employs paid marketing and referrals, email outreach campaigns and paid advertising through out-ofhome and digital media. This channel also includes acquisitions through organic search, search engine optimization (SEO) and Brex’s referral network. ▪ Sales - acquires Customers through sales development and relationship management team s, with a focus on acquiring mid-market businesses and educating Customers on the benefits of Brex’s product offering. Account Origination When a Customer applies for a Brex charge card, the Customer is underwritten in accordance with Brex’s credit risk policy and Customer identification and verification procedures. Brex screens the information provided by each application using automated and proprietary data analysis tools and methods to determine whether the Customer qualifies for an account under Brex’s credit risk policy, compliance policy and eligibility criteria. Customers apply electronically and Brex approves or denies the application pursuant to Brex’s underwriting procedures. Once an account is approved and opened with an Account Owner, the Customer is assigned a credit limit and is issued a virtual card, with physical cards sent by mail. When the Customer initiates a transaction on its card, the transaction is processed through the card network. Brex monitors the Customer’s linked bank account, and perform s additional underwriting and risk review, on an ongoing basis. Customer Identification and Verification When applying for a Brex charge card on Brex’s website, applicants are required to provide the company name, industry, employer identification number, business address, and details regarding controlling officers and beneficial owners. All applicants are required to provide bank account information for payment collection purposes, and the majority provide a direct bank account link for underwriting purposes. Third party software is used for EIN, legal name , and owner background check verification as part of Brex’s applicant review and know-your-customer (KYC) procedures. Brex Credit Policy and Underwriting Brex Customers must satisfy certain conditions for initial eligibility, including evidence of adequate available cash balances in the Customer’s bank account or other liquidity sources, satisfaction of industry criteria, fraud review and other applicable business requirements. Brex Commercial Charge Card Master Trust Series 2022-1 15 March 30, 2022 Brex utilizes proprietary and dynamic underwriting and risk-management models to make credit decisions and extend credit to its Customers. The model is used to evaluate the Customer’s credit profile and ability to repay by, among other things, linking to the Customer’s corporate bank account. In late 2021, the Company made several improvements to its underwriting process through enhanced model analytics that is used in determining credit decisions and credit limits, along with consideration of multiple internal and external factors. Customers who are unable or unwilling to provide Brex with a linked bank account are manually underwritten based on bank statements provided on a periodic basis. Each Customer is assigned a cash balance factor, and credit limits are assigned by multiplying the Customer’s cash balance factor by the Customer’s available cash balance or by a projected cash balance (“Underwriting Cash Balance”). Cash balance factors are assigned in a range of up to 30% based on a customer’s cash availability and the recency of the customer’s cash balance. Credit limits are assigned up to $1 million. Limits over $1 million require additional approval. Dynamic Limits Brex re-assesses the Customer’s risk profile as often as daily based on data observed in a linked bank account and Customers who are underwritten using bank statements must provide updated statements regularly. Brex’s dynamic underwriting model adjusts the Customer’s credit limit periodically in response to changes in the Customer’s risk profile outside of predetermined thresholds, underwriting cash balance or its cash balance factor. The credit limit is determined by multiplying the cash balance factor by the 30-day rolling average cash balance visible in the Customer’s connected bank or bank statement. Brex will not process new transactions if a Customer’s account balance exceeds its credit limit or if a Customer’s limit is lowered below its outstanding card balance . If a Customer’s limit is lowered below its outstanding card balance, the Servicer is able to collect on the over-limit amount immediately (regardless of when the customer’s next statement is due). The Servicer will determine if an account balance should be collected prior to the applicable due date based on Customer and repayment risk level. Credit Flags Action Large decrease in cash balance ▪ Decrease credit limit based on available cash ▪ Customer outreach Net cash balance below minimum threshold ▪ Brex begins a wind-down process of the Customer’s limit as the runway approaches the minimum threshold at which point the limit is reduced to zero Payment and Transaction Flow Card Transaction Processing Brex is responsible for managing card processing, chargebacks, refunds, and other transaction disputes. Historically dilution has remained low because the cards are issued to businesses that use it for company expenses. Brex currently processes transactions through a third-party processor or acts as processor directly with MasterCard through MasterCard Network Gateway Services. Since launching the card product, Brex has processed over $15.1 billion of corporate charge card volumes. Card Settlement Receivables generated under Brex charge cards are settled and acquired from the applicable Account Owner. Generally, Brex prepares and delivers to each Account Owner on each applicable settlement date a purchase statement describing the receivables originated by the Account Owner and setting forth the related purchase price. Brex pays the purchase price for the receivables to an account designated by the Account Owner and thereafter is the sole owner of such receivables. Under the program agreement, Brex is entitled to pledge, transfer, sell, assign, exchange, or collect and receive payments under such receivables. The Account Owner does not have any liability to Brex for the collection or repayment of any receivables under any accounts. Once purchased, Brex will manage all collection-related activities with respect to such receivables. Interchange Credit card issuers participating in the MasterCard association receive certain fees called interchange as partial compensation for taking credit risk, absorbing fraud losses, funding receivables, and servicing cardholders for a limited period prior to initial billing. Under the association rules and regulations, interchange in connection with cardholder charges for merchandise and services is collected by the MasterCard system and subsequently paid to the credit cardissuing banks. Interchange Fees range from approximately 1% to 3% of the transaction amount, although MasterCard may from time to time change the amount of interchange reimbursed. Brex Commercial Charge Card Master Trust Series 2022-1 16 March 30, 2022 Each Account Owner is entitled to Interchange Fees associated with the transactions giving rise to the Receivables and assigns such Interchange Fees to the Seller pursuant to the applicable program agreement. Interchange Fees will be retained by the Seller and will not be treated as Collections and will not be conveyed to the Issuing Entity. Rewards To deliver additional value to its Customers, Brex developed a targeted rewards program where points are earned from purchases on the card. Customers can redeem rewards in the form of statement credits, services, or cash back. To the extent the outstanding amount of any Receivable is reduced by the Servicer due to the redemption of a program reward in the form of a statement credit, the Servicer will adjust the receivable balance in accordance with the transaction documents.The Servicer will reimburse the Issuing Entity for such rewards redemption adjustment and such reimbursed amount will be treated as collections. See the “Interchange and Rewards” KCC for additional detail. Account Terms Brex’s monthly statement card product has a monthly Customer statement cycle, with no grace period or revolving balances. Customer statements include all charges net of chargebacks processed during the statement period. Brex does not charge interest or fees on the monthly statement card product. Fraud Detection All applicants for charge card products must submit completed applications. Information supplied by the applicants is verified by third-party vendors to reduce digital fraud risk. In addition to application fraud, Brex monitors transactions and flags unusual behavior, uses velocity limits, and declines transactions at suspicious merchants. Servicing and Collections As Servicer, Brex is responsible for transaction processing, account maintenance, billing, payment accounting, replacing lost or stolen cards, providing Customer support, and overseeing all other aspects of cardholder services through a combination of in-house employees and managed partnerships. All Brex Customers authorize and agree to automatic ACH collections when signing the Brex Platform Agreement, including the term s applicable to the card program, and are required to provide their bank account information to Brex for collection purposes. Brex has a contractual right to debit any outstanding unpaid amount at any time if additional risk is recognized, and if a Customer’s limit is lowered below its outstanding card balance, Brex is able to collect on the over-limit amount immediately regardless of when the Customer’s next statement is due. Collections Brex automatically collects any outstanding payment in full from each Customer’s bank account once the monthly statement period has ended. Customers receive automated notifications from Brex by email and their Brex dashboard. Notifications are provided when Customers’ limits are reached or exceeded (due to a limit reduction) or when a payment failure has occurred. Upon the failure of a payment, the Customer’s credit limit is reduced to $0 to prevent further use of the card. Brex’s in-house servicing team performs collection activities with respect to delinquent charge card accounts, including outreach by email and telephone in the effort to collect on outstanding balances. An account is charged-off in Brex’s servicing system, and in this transaction, when an outstanding balance has exceeded 120 days past due and no payment has been made on the account within the immediately preceding 30 days, or due to obligor bankruptcy or fraud. Delinquent Receivable Servicing Failed Collection after 2 Business Days ▪ Brex is notified of ACH failure ▪ Customer is reached via automated email and text to inform of rejection notice ▪ Reprocess ACH once issue is resolved Failed Collection after 2-5 Business Days ▪ Customer is reached via phone and email if no response from automated notifications ▪ Servicing action determined based on Customer communication and particular situation ▪ If balance is recovered, depending on the previous failure reason, Brex will re -assess the Customer’s credit limit and may terminate the account in its discretion ▪ If balance is not recovered, active outreach continues and communication is escalated Failed Collection after 120 Business Days ▪ Delinquent balance is charged-off ▪ Recovery process begins Brex Commercial Charge Card Master Trust Series 2022-1 17 March 30, 2022 Below is a summary of Brex’s servicing method for delinquent receivables: Account Owners Brex maintains relationships with each of the Account Owners. All Accounts initially designated to the Brex 2022-1 will have been originated with Emigrant Bank and acquired by Brex. Accounts have not yet been originated with Fifth Third Bank; however, the Company anticipates that accounts eligible for designation to the Issuing Entity will be originated with Fifth Third beginning in the second quarter of 2022. Accounts are originated pursuant to the credit and origination policies jointly established by Brex and each Account Owner. Upon origination of an account the Account Owner will transfer the receivables generated from that account to Brex pursuant to each account owner’s purchase agreement. Emigrant Bank Emigrant is an FDIC-insured New York state chartered bank, founded in 1850 and headquartered in New York, NY. As of December 31, 2020, Emigrant had assets in excess of $5.8 billion. As of December 31, 2021, Emigrant’s Tier 1 Capital was approximately $1.3 billion. Brex’s relationship with Emigrant began in 2018 and Emigrant is the primary issuing bank for Brex’s charge card products. Fifth Third Bank, National Association Fifth Third is a nationally chartered bank regulated by the Office of the Comptroller of the Currency and headquartered in Cincinnati, Ohio. Fifth Third is a member of the FDIC. As of December 31, 2021, Fifth Third had assets in excess of $211 billion. As of December 31, 2021, Fifth Third’s Tier 1 Capital Ratio was approximately 10.89%. Backup Servicer Nelnet Servicing, LLC, a Nebraska limited liability company is a subsidiary of Nelnet, Inc. Nelnet is one of the nation’s largest servicers of private or consumer loans, with approximately $24.5 billion principal balance outstanding as of September 30, 2021 (on a pro-forma basis). Nelnet is headquartered in Lincoln, NE and has offices in, among other cities, Aurora, CO, and Madison, WI. As of September 30, 2021, the company employed approximately 6,500 staff. Duties of the Backup Servicer As the Backup Servicer, Nelnet will perform certain functions to allow it to assume the role of the Servicer if necessary, including reviewing monthly statements provided by the Servicer and confirming the accuracy of certain information contained therein. In the event the Backup Servicer is appointed as Successor Servicer, the Backup Servicer will assume the duties and rights of the Servicer pursuant to the Servicing Agreement. Regulatory and Compliance As a lending platform in the U.S., Brex is subject to regulation by several entities with jurisdiction over the creation and enforcement of its operations. Brex maintains a comprehensive regulatory infrastructure to comply with all federal and state-specific laws. It should be noted that new legislation or regulation can be adopted in the future which materially adversely affect collections or restrict the servicer from certain activities. Further, a certain regulatory authority m ay order the account owner to rescind the transaction, among other actions, and in which case payments to the investors could be accelerated, delayed, or reduced. Congress and state legislatures may also seek to regulate charge card interchange fees and other charge card practices. Currently, the impact of potential new limitations and requirements on Brex or the account owners is unclear.