Official comment
Hi Lee,
Any wall that is more than 2ft below ground (on average) is considered a below grade wall. If it is touching dirt, then yes...it is considered exposed. Interior basement partition walls can be omitted from the calculations. When entering a below grade wall the program will ask you to specify how much of the wall is below the ground and how much is above the ground. The program will then automatically split the wall into the necessary above grade and below grade sections.
Best Regards
Bill