exv10w14






Exhibit 10.14



[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.




Imperial Holdings LLC

701 Park of Commerce Boulevard, Suite 301

Boca Raton, FL 33487




September 14, 2009




Lexington Insurance Company

c/o Risk Finance

Attention: President

Chartis

70 Pine Street, 5th Floor

New York, New York 10270




National Fire & Marine Insurance Company

100 First Stamford Place

Stamford, CT 06902

Attention: General Counsel



Ladies and Gentlemen:




     This letter agreement (including any exhibits hereto, this “Letter Agreement”) relates
to (i) Lender Protection Insurance Policy (Policy No. 7113491), issued by Lexington Insurance
Company (the “Insurer”) to Imperial PFC Financing II, LLC, a Georgia limited liability
company (the “Insured”), effective as of the date hereof (as amended, supplemented or
otherwise modified from time to time, the “Policy”), a copy of which is attached as
Exhibit A hereto and (ii) Contingent Lender Protection Insurance Policy (Policy No.
92SRD102526), issued by National Fire & Marine Insurance Company (the “Contingent Insurer”
and together with the Insurer, the “LPIC Insurers” and each an “LPIC Insurer”) to
the Insured, effective as of the date hereof (as amended, supplemented or otherwise modified from
time to time, the “Contingent Policy”), a copy of which is attached as Exhibit
B hereto. Any capitalized term used in this Letter Agreement but not defined herein (including
in Section 12 hereof) shall have the meaning set forth in the Policy.



     We, Imperial Holdings LLC, a Florida limited liability company (“we” or the
“Company”), have caused the Retail Lender to enter into (i) a Master Participation
Agreement dated as of the date hereof (as amended, supplemented or otherwise modified from time to
time, the “Master Participation Agreement”), between the Retail Lender, as seller, and the
Insured, as purchaser, pursuant to which the Retail Lender has agreed to sell and transfer without
recourse, and the Insured has agreed to purchase a participation interest in certain insurance
premium loans and (ii) certain Insurance Premium Loan Sale and Assignment Agreements (as amended,
supplemented or otherwise modified from time to time, each an “Assignment Agreement”),
between the Retail Lender, as assignor, and the Insured, as assignee, pursuant to which the Retail
Lender has agreed to sell and assign to the Insured, and the Insured has agreed to purchase and
assume, certain insurance premium loans.



 









 





[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.





	1.	 	Representations, Warranties and Covenants of the Company and each LPIC Insurer.






	 	(a)	 	The Company represents, warrants and covenants to each LPIC Insurer as follows:






	 	(i)	 	The Company has all requisite authority to execute, deliver and perform
its obligations under this Letter Agreement. This Letter Agreement has been duly
authorized, executed and delivered by the Company and constitutes a valid and
legally binding agreement of the Company, enforceable in accordance with its terms,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium
and similar laws of general applicability relating to or affecting creditors’
rights and to general equity principles.
	 
	 	(ii)	 	The Company and each other Imperial Party has conducted and will
conduct at all times prior to the termination of all obligations owing under or in
connection with this Letter Agreement, the Policy, the Contingent Policy, any
Coverage Certificate, the Remarketing Agreement and any other document or agreement
executed or delivered by any such Person relating thereto or in connection
therewith (collectively, as the same may be amended, supplemented or otherwise
modified from time to time, the “Imperial LPIC Documents”) its respective
business in all material respects in accordance with all state and federal laws,
statutes, rules and regulations applicable to such entity.
	 
	 	(iii)	 	The Company and each other Imperial Party that will perform services
or take actions in connection with the transactions contemplated by any Imperial
LPIC Document or any Loan Document (A) has consulted and will continue to consult
until the termination of all obligations owing under any Imperial LPIC Document,
qualified outside legal counsel with respect to applicable legal and regulatory
matters (including all applicable state and federal laws, statutes, rules and
regulations) relating to the services or actions that the Imperial Parties will
undertake in connection with the transactions contemplated by the Imperial LPIC
Documents and the Loan Documents (including, rebating, commission sharing and
licensing matters), (B) has provided and will continue during such period to
provide its in-house counsel and such outside counsel with materially accurate
facts on which such counsel may base their research and advice and (C) has
conformed and will continue to conform its conduct in accordance with such advice
in all material respects.
	 
	 	(iv)	 	The Company is not, and will not be as a result of executing this
Letter Agreement, in violation of any law, statute, rule, regulation, judgment,
order or decree of any domestic or foreign court or governmental or regulatory
authority, agency or other body having jurisdiction over the Company or any of its
assets or property.
	 
	 	(v)	 	No consent, approval, authorization or order of, or filing,
registration, qualification, license or permit of or with, any domestic or foreign
court or





2









 







[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.










	 	 	 	governmental or regulatory authority, agency or other body is required to
be obtained or made by the Company in connection with this Letter Agreement that
has not already been obtained or made.
	 
	 	(vi)	 	No action, suit, investigation or proceeding is pending or, to the
knowledge of the Company, threatened before any court or governmental body seeking
any determination or ruling that could materially and adversely affect the
performance by the Company of its obligations under this Letter Agreement.
	 
	 	(vii)	 	(A) The Company has delivered to the Insurer on or prior to the date
hereof true and accurate copies of the Loan Documents; (B) the Company shall, upon
the request of the Insurer or the Contingent Insurer from time to time and at the
Company’s expense, deliver to the requesting LPIC Insurer true and accurate copies
of the then-current Loan Documents and any other agreements or documents being used
by the Company, any Retail Lender or any of its or their Affiliates in connection
with the issuance of Retail Loans that relate to Covered Loans; and (C) in the case
of any amendment or modification of any Loan Document that the Company reasonably
believes is material and/or likely to adversely affect the interests of the Insurer
or the Contingent Insurer (which shall include, without limitation, any amendment
or modification to (x) Section 6 of the Insured Disclosure Statement,
Representations and Warranties, and Consent provided to the Insurer in accordance
with subsection (A) above, which Section 6 provides disclosure concerning the
existence of limited insurance capacity and (y) the definition and related
calculation of the “Yield Maintenance Premium”), the Company shall not utilize such
amended or modified form until (I) it has notified the Insurer (prior the
occurrence of a Credit Event) or the Contingent LPIC Insurer (following the
occurrence of a Credit Event) thereof (specifying the reasons for such amendments
or modifications and whether any relevant governmental authority has suggested,
requested or mandated such amendments or modifications) and (II) the date, if any,
on which the relevant LPIC Insurer provides written notice that it has no objection
to such amendment or modification in writing (any such notice of no objection by
any LPIC Insurer not to be unreasonably withheld, and the applicable LPIC Insurer’s
failure to deliver a written notice of no objection on or prior to the tenth
(10th) Business Day following the date on which the Company supplied
such amended or modified form (and such related information) to the relevant LPIC
Insurer being deemed to be delivery by such relevant LPIC Insurer of notice of
objection as of such date). In the event that the Company believes that it is
prudent to amend or modify any Loan Document in a manner which the Company does not
reasonably believe to be material or reasonably believes is not likely to adversely
affect the interests of the Insurer or the Contingent Insurer (“Non-material
Modification”), the Company may nonetheless solicit the Insurer’s (prior to the
occurrence of a Credit Event) or the Contingent Insurer’s (following the occurrence
of a Credit Event) lack of objection to such amendment or modification, as the case
may be, stating the reasons for such amendments or modifications and





3









 




[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.










	 	 	 	whether any relevant governmental authority has suggested, requested or
mandated such amendments or modifications and stating in writing that the
Company believes the amendment or modification is a Non-material Modification;
the relevant LPIC Insurer’s failure to deliver written notice of objection on or
prior to the tenth (10th) Business Day following the date on which the Company
supplied such amended or modified form (and such related information) to the
relevant LPIC Insurer being deemed to be delivery by such LPIC Insurer of notice
of no objection to such Non-material Modification as of such date.
	 
	 	(viii)	 	The Company or an Affiliate will obtain a legal opinion or legal memorandum from
outside local counsel to the Company or such Affiliate (each such legal opinion or
legal memorandum shall be addressed to the Company or such Affiliate and is
referred to herein as a “Local Counsel Opinion”) qualified to practice in
the states of Georgia, Mississippi and Utah (each, a “Loan State”) no later
than sixty (60) days after the date hereof, addressing each of the questions set
forth on Exhibit C hereto (such questions being, the “Loan State Local
Counsel Questions”) pursuant to the laws, rules and regulations of such
jurisdiction as in effect as of the date of such Local Counsel Opinion. The
Company acknowledges that notwithstanding any other provision of the Policy, this
Agreement, the Services and Remarketing Agreement or any other document or
agreement entered into by the Insurer, the Insurer shall not be obligated to issue
any Coverage Certificates that relate to Retail Loans made in the states of
Georgia, Mississippi or Utah after the day on which such sixty (60) day period has
elapsed if the Insurer has not received a copy of a Local Counsel Opinion covering
the law of such state prior to the end of such sixty (60) day period.
Notwithstanding the foregoing, the requirement set forth in this Section 1(a)(viii)
as it relates to a particular Loan State shall be deemed satisfied if the Company
or an Affiliate has provided a Local Counsel Opinion or related bring-down of a
previously delivered Local Counsel Opinion to the Insurer in connection with
another transaction between the Insurer and the Company at any time during the same
calendar year.
	 
	 	(ix)	 	The Company or an Affiliate will obtain a Local Counsel Opinion from
outside local counsel to the Company or such Affiliate qualified to practice in the
states of California, Florida and New York (each, a “Policy State”) no
later than sixty (60) days after the date hereof, addressing each of the questions
set forth on Exhibit D hereto (such questions being, the “Policy State
Local Counsel Questions”) pursuant to the laws, rules and regulations of such
jurisdiction as in effect as of the date of such Local Counsel Opinion. The
Company acknowledges that notwithstanding any other provision of the Policy, this
Agreement, the Services and Remarketing Agreement or any other document or
agreement entered into by the Insurer, the Insurer shall not be obligated to issue
any Coverage Certificates that relate to life insurance policies issued by Life
Insurance Carriers in a Policy State after the day on which such sixty (60) day
period has elapsed if the Insurer has not received a





4









 






[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.









	 	 	 	copy of a Local Counsel Opinion covering the law of such Policy State prior
to the end of such sixty (60) day period. Notwithstanding the foregoing, the
requirement set forth in this Section 1(a)(ix) as it relates to a particular
Policy State shall be deemed satisfied if the Company or an Affiliate has
provided a Local Counsel Opinion or related bring-down of a previously delivered
Local Counsel Opinion to the Insurer in connection with another transaction
between the Insurer and the Company at any time during the same calendar year.
	 
	 	(x)	 	The Company will obtain a bring-down of each Local Counsel Opinion
delivered in accordance with clauses (viii) and (ix) immediately above on or prior
to April 15 (but not prior to April 1) of each year beginning in April 2010;
provided that, if the Company or an Affiliate provides the Insurer with a
bring-down of a Local Counsel Opinion for a particular jurisdiction meeting this
requirement in connection with another transaction between the Insurer and the
Company, then such bring-down of the Local Counsel Opinion will satisfy this
requirement. Notwithstanding the foregoing, the Company or an Affiliate may obtain
a new Local Counsel Opinion in lieu of a bring-down Local Counsel Opinion otherwise
required by this clause (x) so long as such new Local Counsel Opinion is dated a
date in April of the applicable year and addresses each Loan State Local Counsel
Opinion Question or each Policy State Local Counsel Opinion Question, as
applicable, pursuant to the laws, rules and regulations of the applicable
jurisdiction as in effect as of the date of such new Local Counsel Opinion;
provided that, if the Company or an Affiliate obtained a Local Counsel Opinion with
respect to the laws, rules and regulations of a jurisdiction pursuant to clause
(viii) or (ix) immediately above dated any time from March 1 of a given year to
April 15 of such year, then the Company shall not be required to deliver a
bring-down of such Local Counsel Opinion until April of the following year. The
Company will and will cause each other Imperial Party to conform its conduct
accordingly in all material respects to the Local Counsel Opinions or the
bring-downs of such Local Counsel Opinions, as applicable.
	 
	 	(xi)	 	Each LPIC Insurer shall have the right, but not the obligation, from
time to time to examine or audit all of the Company’s and/or any other Imperial
Party’s books and records that relate to the coverage provided by the Policy and
the Contingent Policy. The relevant LPIC Insurer shall notify the Company of such
an inspection at least five (5) Business Days in advance. To the extent that such
books and records are to be maintained by a third party on behalf of an Imperial
Party, the Company shall, and shall cause the relevant Imperial Party to, ensure
that any related agreement with such third party allows for the relevant LPIC
Insurer to examine such books and records and the Company shall direct such third
party to allow the relevant LPIC Insurer to examine such books and records in
accordance with this paragraph. Each LPIC Insurer may appoint an Affiliate to
conduct the examinations and audits permitted by this clause (x).




5









 





[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.










	 	(xii)	 	Upon the commission of an Imperial Prohibited Act by (A) an employee
or agent of the Company or any other Imperial Party or (B) any life insurance
agents, any life insurance brokers or any life insurance producers, in each case
acting in such capacity, the Company shall, and shall cause each other Imperial
Party to, take (I) prompt commercially reasonable corrective action, including, but
not limited to, prohibiting each applicable employee or agent from working on any
further matters that relate to the Insurer and (II) all commercially reasonable
action that may be necessary to promptly identify to the Insurer all outstanding
Pre-Certificate Review Submissions attributable in any way to such employee or
agent.
	 
	 	(xiii)	 	The Company shall notify the Insurer (prior to the occurrence of a Credit Event)
or the Contingent Insurer (following the occurrence of a Credit Event) within five
(5) Business Days of an Authorized Officer becoming aware of (A) any Prohibited Act
or Imperial Prohibited Act by any Person or an employee or agent of any Person
(including, without limitation, any life insurance agents, any life insurance
brokers or any life insurance producers, in each case acting in such capacity), or
(B) Advised Conduct which is not, or is likely not, to be in compliance with any
law, rule or regulation then in effect in a relevant jurisdiction.
	 
	 	(xiv)	 	The Company has, and shall maintain, members’ equity of not less than
$[*]. The Company shall provide a certificate signed by its Chief Executive
Officer or Chief Financial Officer evidencing its satisfaction of this covenant (1)
to the Insurer on the date hereof and (2) to the Insurer (prior to the occurrence
of a Credit Event) or the Contingent Insurer (following the occurrence of a Credit
Event) quarterly, on or before the date that is thirty (30) days after the end of
each fiscal quarter of the Company that occurs during the term of this Letter
Agreement. Notwithstanding the foregoing, the requirement set forth in clause (2)
immediately above shall be deemed satisfied if the Company has otherwise provided
an officer’s certificate to the applicable LPIC Insurer during the relevant
reporting period in connection with another transaction between the LPIC Insurers
and the Company.
	 
	 	(xv)	 	The Company has, and shall maintain during the term of this Letter
Agreement and for at least a one (1) year period immediately following the term of
this Letter Agreement, an errors and omissions insurance policy insuring against
errors and omissions exposures relating to or arising out of activities of the
Company or any other Imperial Party in connection with the transactions to which
this Letter Agreement relates (including, without limitation, the activities of the
Company in connection with this Letter Agreement and the activities of Imperial
Life and Annuity Services, LLC in connection with the Services and Remarketing
Agreement) having a per occurrence limit of at least $[*] and an aggregate limit of
at least $[*] from a U.S. carrier rated at least “A” by Standard & Poor’s Rating
Services, a division of the McGraw Hill Companies, Inc., or at least “A2” by
Moody’s Investor Service Inc. (an “E&O Policy”).




6









 






[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.









	 	(xvi)	 	Neither the Company nor any person or entity that holds a direct or
indirect interest in the Company or any other Imperial Party is (i) a person or
entity listed in the Annex to Executive Order No. 13224 (2001) issued by the
President of the United States (Executive Order Blocking Property and Prohibiting
Transactions with Persons Who Commit, Threaten to Commit, or Support Terrorism), or
(ii) named on the List of Specially Designated Nationals and Blocked Persons
maintained by the U.S. Office of Foreign Assets Control.
	 
	 	(xvii)	 	The Company is an “accredited investor” as that term is defined in Rule
501 of Regulation D under the Securities Act of 1933, as amended.
	 
	 	(xviii)	 	The Company shall, upon the request of either LPIC Insurer and at the Company’s
expense, provide the relevant LPIC Insurer with identifying information regarding
the Company in connection with the requirements of the Uniting and Strengthening
America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism
Act of 2001 (“USA Patriot Act”), Pub. L., 107-56, 115 Stat. 380 (October
26, 2001), as amended.
	 
	 	(xix)	 	The Company (A) has performed analyses in respect of FASB
Interpretation No. 46 (“Consolidation of Variable Interest Entities”) as in effect
on the date hereof and (B) represents and warrants to the Insurer as of the date
hereof that, based upon such analyses, the Company will consolidate the financial
position and results of the Insured in the consolidated financial statements of the
Company. In addition, the Company covenants to each LPIC Insurer that the Company
will notify each LPIC Insurer in writing in the event that the Company changes its
conclusion regarding the consolidation of the Insured.
	 
	 	(xx)	 	If, at any time on or after the date of this Letter Agreement, the
premium finance program of the Retail Lender referenced in this Letter Agreement is
“approved” or “reviewed” by a life insurance carrier, the Company shall provide
written notice of such approval or review to the Insurer (prior to the occurrence
of a Credit Event) or the Contingent Insurer (following the occurrence of a Credit
Event) within ten (10) Business Days of the Company learning of such approval or
review.
	 
	 	(xxi)	 	The Company shall (i) promptly provide to the Insurer (prior to the
occurrence of a Credit Event) or the Contingent Insurer (following the occurrence
of a Credit Event) a copy of all notices delivered by the Insured as borrower
pursuant to Section 7.01(a)(i), (ii), (viii) or (x) of the Wholesale Loan Agreement
and (ii) cause the Insured to comply with the terms of the Policy and the
Contingent Policy and comply with the representations, warranties and covenants of
the Insured set forth in the Policy and the Contingent Policy.
	 
	 	(xxii)	 	The Company shall not permit the Retail Lender to sell, assign or otherwise
transfer any Retail Loan that relates to a Covered Loan or any interest therein





7









 





[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.









	 	 	 	to any Person other than the Insured pursuant to the Master Participation
Agreement or an Insurance Premium Loan Sale and Assignment Agreement.
	 
	 	(xxiii)	 	The Company shall not permit the Retail Lender to make Retail Loans that relate
to Covered Loans in any state other than the states of Georgia, Mississippi or
Utah.
	 
	 	(xxiv)	 	(i) The LPIC Insurers’ identity has not been and shall not be disclosed by any
Imperial Party or, to the knowledge of any other Imperial Party, any Responsible
Party in any offering materials or discussions with rating agencies or any life
insurance company without the prior written consent of the Insurer (which consent
the Insurer can withhold in its sole and absolute discretion) and (ii) the Policy
and the Contingent Policy have not been and shall not be referenced by any Imperial
Party or, to the knowledge of any Imperial Party, any Responsible Party in any
offering materials or discussions with rating agencies in connection with any rated
or unrated securities offering without the prior written consent of the relevant
LPIC Insurer (which consent the LPIC Insurers can withhold in their sole and
absolute discretion).
	 
	 	(xxv)	 	None of the reports, financial statements, certificates or other
information furnished by or on behalf any Imperial Party to either LPIC Insurer in
connection with the negotiation of the Imperial LPIC Documents (as modified or
supplemented by other information so furnished) contains any material misstatement
of fact or omits to state any material fact necessary to make the statements
therein, in the light of the circumstances under which it was made, not misleading;
provided that, with respect to projected financial information, the Company
represents only that such information was prepared in good faith based upon
assumptions believed to be reasonable at the time prepared.
	 
	 	(xxvi)	 	No Imperial Party will assist with the solicitation or application process of any
Covered Policy and no Imperial Party will be appointed by any life insurance
carrier or life insurance policy purchaser to act in any such capacity. For the
avoidance of doubt, this section does not prohibit any Imperial Party from
completing premium finance related forms in connection with the purchase, sale or
issuance of any Covered Policy related to a premium finance program that has been
reviewed or approved by a Life Insurance Carrier.
	 
	 	(xxvii)	 	Each fee agreement between Imperial Life & Annuity Services, LLC or any other
Imperial Party and any life insurance agent or broker relating to any Covered Loan
or prospective Covered Loan will be executed after the Life Insurance Carrier has
issued the related Covered Policy. In addition, the fee payable to Imperial Life &
Annuity Services, LLC or any other Imperial Party in connection with any fee
agreement described in the previous





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[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.










	 	 	 	sentence is due whether or not the life insurance agent or broker receives
its commission from the Life Insurance Carrier.
	 
	 	(xxviii)	 	As per qualified outside legal counsel, the activities of Imperial Life &
Annuity Services, LLC in connection with the transactions contemplated by the
Imperial LPIC Documents and/or the Loan Documents, including interactions and fee
arrangements with life insurance agents or brokers, comply and will continue to
comply with applicable rebating and commission sharing laws and regulations in
effect in states where (A) Covered Policies are issued by Life Insurance Carriers
and (B) the Retail Lender makes loans secured directly or indirectly by Covered
Policies or interests therein.




The representations, warranties and covenants set forth in this Section 1(a) shall survive
termination of this Letter Agreement.





	 	(b)	 	Each LPIC Insurer represents and warrants on behalf of itself to the Company as
follows:






	 	(i)	 	Such LPIC Insurer has all requisite power and authority to execute,
deliver and perform its obligations under this Letter Agreement. This Letter
Agreement has been duly authorized, executed and delivered by such LPIC Insurer and
constitutes a valid and legally binding agreement enforceable in accordance with
its terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors’ rights and to general equity principles.
	 
	 	(ii)	 	As a result of executing this Letter Agreement, such LPIC Insurer will
not be in violation of any law, statute, rule, regulation, judgment, order or
decree of any domestic or foreign court or governmental or regulatory authority,
agency or other body having jurisdiction over such LPIC Insurer or any of its
assets or property.
	 
	 	(iii)	 	No consent, approval, authorization or order of, or filing,
registration, qualification, license or permit of or with, any domestic or foreign
court or governmental or regulatory authority, agency or other body is required to
be obtained or made by such LPIC Insurer in connection with this Letter Agreement
that has not already been obtained or made.
	 
	 	(iv)	 	No action, suit, investigation or proceeding is pending or, to the
knowledge of such LPIC Insurer, threatened before any court or governmental body
seeking any determination or ruling that could materially and adversely affect the
performance by such LPI C Insurer of its obligations under this Letter Agreement.




The representations, warranties and covenants set forth in this Section 1(b) shall survive
termination of this Letter Agreement.







9









 





[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.






	2.	 	Enforcement of Rights and Remedies; Monetary Recoveries.






	 	(a)	 	If the Insurer or the Contingent LPIC Insurer makes a payment pursuant to the Policy or
the Contingent Policy, as the case may be, in connection with a Covered Loan or a Covered
Policy, then the Company will and will cause each other Imperial Party to use commercially
reasonable efforts to enforce all remedies available to the Company or any such Imperial
Party under the terms of each guaranty, if any, delivered by or on behalf of a Retail
Borrower pursuant to the terms of such Covered Loan (any such amount paid by the Insurer
under the Policy in connection with a Covered Loan or Covered Policy being, a
“Reimbursable Loss”). In connection with the enforcement of any such guaranty, the
Company or any other Imperial Party shall be entitled to settle any enforcement actions on
terms and provisions that it considers reasonable under the circumstances and may decline
to pursue enforcement actions in the event it considers enforcement imprudent under the
circumstances; provided that prior to settling or declining to pursue any such enforcement
action, such Imperial Party shall consult with the Insurer (prior to the occurrence of a
Credit Event) or the Contingent Insurer (following the occurrence of a Credit Event)
regarding its proposed course of action. Within seven (7) Business Days of receipt by any
Imperial Party of any monetary recovery relating to any such guaranty, the Company will pay
any such amount to the LPIC Insurer that made the related payment pursuant to the Policy or
the Contingent Policy, as the case may be, less any reasonable out-of-pocket expenses
incurred by the Company or an Affiliate in enforcing any such guaranty, with the aggregate
amount of any such payments to the relevant LPIC Insurer relating to any Covered Loan not
to exceed the amount of the Reimbursable Loss associated with such Covered Loan.
	 
	 	(b)	 	If either LPIC Insurer (i) pays a loss to the Insured pursuant to Section I of the
Policy in connection with a Covered Loan and (ii) notifies the Insured in writing, pursuant
to Section IV.F.(2) of the Policy, that the Insurer is not requiring transfer of ownership
of the related Covered Policy or the Beneficial Interest in the related Trust but is
requiring the cooperation of the Insured and the Collateral Agent with regard to such
Covered Policy and, if applicable, the Beneficial Interest in the related Trust, then the
Company will cause (A) the Insured to take all commercially reasonable and lawful actions
requested by the paying LPIC Insurer in connection with Section IV.F.(2) of the Policy and
(B) the Insured to (I) instruct the Collateral Agent (or any back-up servicing agent, if
applicable) to maintain full rights in such Covered Policy or such Beneficial Interest in
the related Trust to the extent required by Section IV.F.(2) of the Policy and to take all
commercially reasonable and lawful actions requested by the Insured (which requests of the
Insured shall match the instructions received by the Insured from the paying LPIC Insurer
with respect to the actions to be taken by the Collateral Agent (or any back-up servicing
agent, if applicable)) in connection with Section IV.F.(2) of the Policy, and (II) enforce
all rights and remedies available to the Insured should the Collateral Agent (or any
back-up servicing agent, if applicable) fail to comply with such instructions.






	3.	 	Indemnification.




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OF THE SECURITIES ACT OF 1933, AS AMENDED.










	 	(a)	 	The Company agrees to indemnify and hold harmless each LPIC Insurer, its Affiliates and its
and their respective officers, directors, shareholders, controlling persons, employees,
agents, advisors, successors, transferees, participants and assigns (each of the foregoing
persons being individually called an “Indemnified Party”) from and against any and all
claims, demands, damages, losses (including the full amount of any Outstanding Loan Balance
paid by such LPIC Insurer under the Policy or the Contingent Policy, as the case may be),
liabilities charges and expenses (including, without limitation, reasonable fees and expenses
of counsel) that may be incurred by or asserted against any Indemnified Party (all of the
foregoing being collectively called “Losses”), in each case, arising out of, related
to, or in connection with or by reason of: (i) the commission of an Imperial Prohibited Act by
any of an Imperial Party, PFSC or a Corporate Trustee; (ii) any failure by any Imperial Party
to comply with any Local Counsel Opinion; (iii) any breach or alleged breach by (x) the
Insured of any representation, covenant or warranty or failure to comply with, any of the
statements or agreements set forth in any Imperial LPIC Document; (y) the Company of any
representation, covenant or warranty or failure to comply with, any of the agreements set
forth in this Letter Agreement or (z) Imperial Life & Annuity Services, LLC of any
representation, covenant or warranty or failure to comply with any of the agreements set forth
in the LPIC Services and Remarketing Agreement, dated as of the date hereof, among the
Insurer, the Contingent LPIC Insurer and Imperial Life & Annuity Services, LLC (as amended,
supplemented or otherwise modified from time to time, the “Services and Remarketing
Agreement”); (iv) any failure by the Collateral Agent (or any back-up servicing agent, if
applicable) to comply with any of the terms set forth in Section IV.F.(2) of the Policy;
(v)(A) any act by an Imperial Party, a Collateral Agent, a Servicer or a Corporate Trustee or
(B) any act by a Non-Corporate Trustee occurring from and after the time when a Retail Loan is
made to the related Retail Borrower, that was, in the case of any act described in (A) or (B),
at the time any such act occurred, a fraudulent, illegal, criminal, malicious or grossly
negligent act; or (vi) the Contest of a Covered Policy before the related Coverage Certificate
Effective Date. The indemnification available to any Indemnified Party under this Section 3
shall not be reduced in any way by any LPIC Premium or Contingent LPIC Premium receivable by
the Insurer or the Contingent LPIC Insurer pursuant to the Policy or the Contingent Policy, as
the case may be. The Company shall remit payment with respect to a claim for indemnification
under this Section 3 within 15 Business Days of notice thereof by an Indemnified Party. The
indemnification provided by this Section 3 shall survive the termination of this Letter
Agreement.
	 
	 	(b)	 	If for any reason the indemnification provided in this Section 3 is unavailable to an
Indemnified Party or is insufficient to hold an Indemnified Party harmless, then the
Company shall contribute to the amount paid or payable by such Indemnified Party as a
result of such loss, claim, damage or liability in such proportion as is appropriate to
reflect not only the relative benefits received by such Indemnified Party, on the one hand,
and the Company, on the other hand, but also the relative fault of such Indemnified Party,
on the one hand, and the Company, on the other hand, as well as any other relevant
equitable considerations.




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BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.









	4.	 	Notices. All demands, notices and communications hereunder shall be in writing and
shall be deemed to have been duly given if personally delivered by certified mail, return
receipt requested, mailed by a nationally recognized overnight courier or sent via facsimile
to (i) the Company at 701 Park of Commerce Boulevard, Suite 301, Boca Raton, FL 33487,
Attention: Jonathan Neuman, President, facsimile: 240-282-1050, with a copy to Foley & Larder
LLP, One Independent Drive, Suite 1300, Jacksonville, FL 32202-5017, Attention: Robert S.
Bernstein, Esq., facsimile: 904-359-8700, (ii) the Insurer at 70 Pine Street, 5th
Floor, New York, New York 10270, Attention: Surveillance Department, facsimile:
212-943-4054, with a copy to Risk Finance, Attention: Division General Counsel, Chartis, 70
Pine Street, 5th Floor, New York, New York 10270, facsimile: 212-480-3923, (iii)
National Fire & Marine Insurance Company, Attention: General Counsel, 100 First Stamford
Place, Stamford, CT 06902, Facsimile: (203) 363-5221 or (iv) as to any of such persons, at
such other address or facsimile number as shall be designated by such person in a written
notice to the other persons.






	5.	 	Governing Law. This Letter Agreement shall be governed by, and construed in
accordance with, the internal laws of the State of New York (including without limitation
Section 5-1401 of the General Obligations Law of the State of New York), without regard to
conflicts of laws principles that would require or allow for the application of any other
jurisdiction’s law.






	6.	 	Remedies. The rights, remedies, powers and privileges of each LPIC Insurer provided
herein shall not preclude all other rights, remedies, powers and privileges provided to such
LPIC Insurer by law.






	7.	 	Setoff. Each LPIC Insurer shall have the right to setoff any amounts due from such
LPIC Insurer to the Company or any Affiliate of the Company against any amounts that are due
to such LPIC Insurer from the Company or any Affiliate of the Company.






	2.	 	Dispute Resolution. It is hereby understood and agreed that all disputes or
differences which may arise under or in connection with this Agreement shall be submitted to
binding arbitration. Any such arbitration shall be based on the Procedures for the Resolution
of U.S. Insurance and Reinsurance Disputes dated September 1999 (the “Procedures”), as
supplemented by the below. The Panel shall consist of three Disinterested arbitrators, one to
be appointed by the Petitioners, one to be appointed by the Respondents and the third to be
appointed by the two Party-appointed arbitrators. The third arbitrator shall serve as the
umpire, who shall be neutral. The arbitrators and umpire shall be persons who have knowledge
of the legal, financial, corporate and insurance issues relevant to the matters in dispute and
who are (a) current or former officers or executives of an insurer or reinsurer or (b) former
state court or federal judges. Within thirty days of the commencement of the arbitration
proceeding, each Party shall provide the other Party with the identification of its
Party-appointed arbitrator, his or her address (including telephone, fax and e-mail
information), and provide a copy of the arbitrator’s curriculum vitae. If either Party fails
to appoint an arbitrator within that thirty-day period (or applicable longer period), the
non-defaulting Party will appoint an arbitrator to act as the Party-appointed arbitrator for
the
defaulting Party. The umpire shall be appointed by the two Party-appointed arbitrators as soon
as practical (but no later than 30 days) after the appointment of the second arbitrator.




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BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.










	 	 	The Party-appointed arbitrators may consult, in confidence, with the Party who appointed
them concerning the appointment of the umpire. Where the two Party-appointed arbitrators have
failed to reach agreement on an umpire within the time specified in paragraph (2) immediately
above, each Party shall propose to the other in writing, within 7 days thereafter, eight umpire
candidates from the ARIAS U.S. Certified Arbitrators List in effect at the time of the
commencement of the arbitration. The umpire will then be selected in accordance with 6.7(b)-(e)
of the Procedures. (Unless the Parties agree otherwise, the ARIAS U.S. Umpire Questionnaire Form
in effect at the time of the commencement of the arbitration shall be used).






	 	 	The arbitration shall take place in New York, New York. Unless prohibited by law, the Supreme
Court of the State and County of New York and the United States District Court for the Southern
District of New York shall have exclusive jurisdiction over any and all court proceedings that
either Party may initiate in connection with the arbitration, including proceedings to compel,
stay, or enjoin arbitration or to confirm, vacate, modify, or correct an Arbitration Award.






	 	 	The arbitration award shall not include attorneys’ fees or other costs. Each party shall bear
the expense of its own arbitration activities, including its appointed arbitrator and its
outside attorney or witness fees, and the parties shall equally bear the expense of the umpire
and the common expenses of the arbitration proceeding.






	 	 	For purposes of this Section 11, the terms “Arbitration Award,” “Disinterested,” “Notice of
Arbitration,” “Panel,” “Party” (or “Parties”), “Petitioner,” “Respondent,” and “Response” shall
have the meanings set forth in article 2 of the Procedures (Definitions).






	 	 	It is understood and agreed that to the extent that they shall be involved in a dispute with the
Company hereunder, for the purposes of this Section 8, the LPIC Insurers shall be deemed to be a
single Party (and a single Petitioner or Respondent, as the case may be).






	 	 	In the event of any conflict between the Procedures and this Section 8, this Section 8, and not
the Procedures, will control. This Section 8 shall survive termination of this Letter
Agreement.






	8.	 	Construction; Entire Agreement. Each LPIC Insurer and the Company hereby acknowledge
that they were represented by competent and experienced legal counsel of their choice in
connection with the negotiation, execution and delivery of this Letter Agreement, and the
Company acknowledges that it is entering into the transactions contemplated by this Letter
Agreement with full knowledge and acceptance of its terms, conditions and significance,
without any reliance on any representation, warranty, advice or other statement by any LPIC
Insurer or any of its representatives or advisors regarding any legal, tax or accounting
implications or other requirements. Accordingly, in any dispute concerning this Letter
Agreement, such dispute shall be resolved without any presumption or rule of construction in
favor of any party or any related or similar doctrine. This Letter Agreement contains the
full and complete understanding and agreement between the parties hereto with respect to the
subject matter hereof. The parties acknowledge that they are not entering into this Letter
Agreement in reliance upon any term, condition, representation or warranty not stated or





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OF THE SECURITIES ACT OF 1933, AS AMENDED.









	 	 	referred to herein and that this Letter Agreement replaces any and all prior agreements whether
oral or written, pertaining to the subject matter hereof.
	 
	9.	 	Counterparts. This Letter Agreement may be executed in any number of counterparts,
each of which shall be deemed an original and all of which taken together shall constitute one
and the same document.
	 
	10.	 	Amendments. This Letter Agreement may be amended, modified, supplemented or
terminated only by a written instrument signed by the Insurer (prior to the occurrence of a
Credit Event), the Contingent Insurer and the Company.
	 
	11.	 	Defined Terms. For purposes of this Letter Agreement:




“Accredited investor” shall have the meaning set forth in Section 1(a)(xv).



“Advised Conduct” shall have the meaning set forth in section B(2) of Imperial Prohibited
Act as defined in this Section 12.



“Affiliate” of any Person means any other Person that (i) directly or indirectly controls,
is controlled by or is under common control with such Person or (ii) is an officer or director of
such Person. A Person shall be deemed to be “controlled by” any other Person if such other Person
possesses, directly or indirectly, power: (i) to vote 10% or more of the securities (on a fully
diluted basis) having ordinary voting power for the election of directors or managing partners; or
(ii) to direct or cause the direction of the management and policies of such Person whether by
contract or otherwise.



“Authorized Officer” means any member of the board of directors or managers of an entity,
chief executive officer, president, chief operating officer, chief financial officer, treasurer,
general counsel or lead regulatory officer responsible for ensuring compliance with all applicable
lending and insurance statutes, rules and regulations.



“Contingent Insurer” shall have the meaning set forth in Preamble.



“Contingent Policy” shall have the meaning set forth in Preamble.



“Corporate Trustee” means any institutional trustee that is appointed as trustee or
co-trustee of a Retail Borrower at the request of the Retail Lender.



“E&O Policy” shall have the meaning set forth in Section 1(a)(xiii).



“Imperial LPIC Documents” shall have the meaning set forth in Section 1(a)(ii).



“Imperial Party” means any of the Company, any Retail Lender, the Insured and/or their
respective Affiliates and its and their respective officers, directors and employees.



“Imperial Prohibited Act” means any of the following:







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BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.




(A) in connection with the issuance of a Covered Policy by a Life Insurance Carrier or the issuance
or maintenance of a loan supported directly or indirectly by a Covered Policy,





	 	(1)	 	and/or for the purpose of encouraging the issuance of or application for such
Covered Policy or a loan supported directly or indirectly by such Covered Policy,
providing any upfront inducement or gift valued in excess of $[*] or otherwise in
violation of applicable law for the benefit of a borrower, any beneficiary or owner
thereof and/or the Underlying Life and/or the spouse or significant other of the
Underlying Life; provided that the conduct described in following provisions
(a) and (b) shall not constitute an upfront inducement or gift for purposes of this
clause (1) so long as such conduct does not violate applicable law:






	 	(a)	 	conduct that does not result in the Retail Borrower being
entitled to borrow amounts under the related Retail Loan that exceed the
aggregate sum of: (i) the amount of life insurance premium previously paid, or
that will be paid by such Retail Borrower thereafter in accordance with such
Retail Loan, in order to keep the related Covered Policy in force from the date
of issuance thereof through the 60th day after the related Maturity
Date, (ii) the related LPIC Premium, (iii) the related Contingent LPIC Premium
and (iv) costs and expenses that such Retail Borrower has incurred in
connection with the related Retail Loan or has previously paid in respect of
such Covered Policy or a loan supported by such Covered Policy; and/or
	 
	 	(b)	 	any reasonable business marketing activity, event or meal
conducted by any employee or Authorized Officer of the Retail Lender or any
Affiliate thereof or a Responsible Party for the benefit of the Retail
Borrower, any beneficiary of the Retail Borrower, and/or the Underlying Life
and/or the spouse or significant other of the Underlying Life, and paid for by
the Retail Lender or any Affiliate thereof or a Responsible Party without any
condition that the recipient or beneficiary thereof purchase or finance any
insurance;






	 	(2)	 	in connection with the issuance of a Covered Policy by a Life Insurance Carrier
or the issuance or maintenance of a loan supported directly or indirectly by a Covered
Policy, causing any portion of the death benefit from such Covered Policy to be paid to
parties other than (a) those with an insurable interest in the Underlying Life, (b)
beneficiaries chosen by the Underlying Life (in any case, other than the Retail Lender
or any Affiliate thereof, a Responsible Party or any Authorized Officer of any of the
foregoing) or (c) the Retail Lender in satisfaction of the related Covered Loan;
provided that, the amount collected by the Retail Lender may not exceed the
outstanding loan principal, together with related interest and reasonable and customary
charges or fees; and provided further that if (i) the aggregate amount of charges and
fees with regard to such Covered Loan, other than LPIC Premium, does not exceed [*]
percent ([*]%) of the Covered Loan Amount or (ii) no LPIC Premium is charged directly
to the Retail Borrower and identified as such under a Covered Loan, the aggregate





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BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.









	 	 	 	amount of charges and fees with regard to such Covered Loan does not exceed the sum
of [*] percent ([*]%) of the Covered Loan Amount plus the amount of LPIC Premium
paid in connection with such Covered Loan, then such charges and fees shall be
considered reasonable and customary for purposes of this clause (2);
	 
	 	(3)	 	requiring a borrower to sell, assign (other than through a pledge of such
Covered Policy or related Beneficial Interest as collateral and any foreclosure or
liquidation of such collateral to satisfy such loan and related amounts) or settle such
Covered Policy that acts as collateral or penalizing such borrower for not selling,
assigning or settling any such Covered Policy;
	 
	 	(4)	 	(a) requiring a borrower to share or otherwise forfeit any proceeds derived
from the future sale, assignment or settlement of such Covered Policy (other than
through a pledge of such Covered Policy or related Beneficial Interest as collateral
and any foreclosure or liquidation of such collateral to satisfy a loan and related
amounts); it being understood that no part of this clause (a) is intended to allow the
use of an interest rate that (i) is not fixed, (ii) is not correlated to a commercially
accepted index or instrument (such as “Libor”, “prime” or a U.S. treasury bill) or
(iii) may otherwise result in any Person paying or owing any amount contingent upon the
future value or sale price of a Covered Policy or (b) requiring a borrower to
consummate any such sale, assignment or settlement with a particular agent or
settlement company; or
	 
	 	(5)	 	penalizing a borrower for prepaying any such loan other than pursuant to a
market prepayment penalty, make whole premium or early termination fee;
provided that a prepayment penalty, make whole premium or early termination fee
that (i) is consistent with the “Yield Maintenance Premium” set forth in the Retail
Loan Documents and in any event (ii) does not result in the borrower paying more than
it would have paid in full satisfaction of the Covered Loan at maturity shall be
considered a market prepayment penalty, make whole premium or early termination fee for
purposes of this clause (5);




or





	(B)	(1)   	 conduct that, in the reasonable determination of the Insurer
(prior to the occurrence of a Credit Event) or the Contingent
Insurer (following the occurrence of a Credit Event), causes
a material number of Covered Loans issued in any jurisdiction
to fail to meet in any material respect the factual
assumptions or conform to the legal advice set forth in the
Local Counsel Opinion most recently obtained by the Company
or an Affiliate with respect to the laws, rules and
regulations of such jurisdiction; provided that if the
Company and its Affiliates have taken reasonable steps to
ensure that the Covered Loans comply with (i) the facts
identified by the Company or an Affiliate and relied upon by
counsel in giving the legal advice set forth in the Local
Counsel Opinion (other than any such facts identified in the
Local Counsel Opinion as not being in compliance with
applicable law in the relevant state or otherwise
contradicted by




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OF THE SECURITIES ACT OF 1933, AS AMENDED.









	 	 	 	facts identified by counsel in such Local Counsel Opinion), (ii) any facts
identified by counsel in the Local Counsel Opinion that are in addition to the facts
identified by the Company or an Affiliate and that are relied up by counsel in
giving such legal advice, and (iii) any facts identified by counsel in the Local
Counsel Opinion that contradict the facts identified by the Company or an Affiliate
and that are relied upon by counsel in giving such legal advice, then the Company
and its Affiliates will not be treated as having engaged in conduct described in
this clause (vi) in respect to such Covered Loans;
	 
	 	(2)	 	failing to take corrective action within thirty (30) days of an Authorized
Officer of the Company or an Affiliate of the Company becoming aware that any conduct
undertaken in any jurisdiction by the Company or any Affiliate of the Company as a
result of or relating to a Local Counsel Opinion delivered with respect to the laws,
rules or regulations of such jurisdiction (any such conduct so undertaken being,
“Advised Conduct”) was or is, or that there is a substantial likelihood that
such Advised Conduct was or is, not in compliance with any law, rule or regulation then
in effect in such jurisdiction (including, without limitation, as a result of the
enactment of a new law, rule or regulation after the date on which the Local Counsel
Opinion (or bring-down thereof) was delivered); provided that, if (a) the Company or
any Affiliate of the Company undertakes any Advised Conduct in a jurisdiction that it
believes, in good faith, complies in all material respects with the facts,
circumstances and/or standards set forth in the most recent Local Counsel Opinion (or
bring-down thereof) delivered in such jurisdiction, (b) a party asserts that such
Advised Conduct was or is not in compliance (for reasons other than the enactment of a
new law, rule or regulation after the date on which such Local Counsel Opinion (or
bring-down thereof) was delivered) with any law, rule or regulation cited or referred
to in such Local Counsel Opinion (or bring-down thereof) and (c) the Company or any
Affiliate of the Company is in good faith challenging whether such Advised Conduct was
or is not in compliance with such law, rule or regulation, then an Authorized Officer
of the Company or any Affiliate of the Company (y) until the earlier of the decision by
the relevant Imperial Party to no longer continue such challenge or a final
determination has been made regarding the matter, shall not be deemed to be aware that
there is a substantial likelihood that Advised Conduct was or is not in compliance with
any such law, rule or regulation and shall not be required to take corrective action
with regard to such Advised Conduct and (z) shall provide prompt written notice of the
existence of any such challenge, and the facts relating to such challenge, to the
Insurer (for purposes of this clause (B)(2), “final determination” shall mean an order
of a court, a decision of an arbitration panel or a non-appealable ruling of an
administrative law tribunal, in each case with jurisdiction over the matter); or
	 
	 	(3)	 	failing to provide written notice to the Insurer (prior to the occurrence of a
Credit Event) or the Contingent Insurer (following the occurrence of a Credit Event)
within thirty (30) days following any Authorized Officer of the Company or any
Affiliate of the Company obtaining knowledge that a Prohibited Act or an Imperial
Prohibited Act has been committed.




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BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.








For the avoidance of doubt and notwithstanding the foregoing, any isolated or non-sanctioned
conduct by an employee or agent of the Imperial Parties (other than an Authorized Officer of the
Company or an Affiliate of the Company) shall not be treated as an Imperial Prohibited Act provided
that an Authorized Officer of the Company or an Affiliate of the Company provides written notice to
the Insurer (prior to the occurrence of a Credit Event) or the Contingent Insurer (following the
occurrence of a Credit Event) within thirty (30) days following the time any Authorized Officer of
the Company or an Affiliate of the Company obtains knowledge that such act or conduct has occurred
or been committed and the Imperial Parties take appropriate remedial actions, in accordance with
Section 1(a)(x) of this Letter Agreement.



“Indemnified Party” shall have the meaning set forth in Section 3.



“Insurer” shall have the meaning set forth in Preamble.



“Insured” shall have the meaning set forth in Preamble.



“Letter Agreement” shall have the meaning set forth in Preamble.



“Loan Documents” means (a) the Master Participation Agreement, (b) each Assignment
Agreement and (c) for each Covered Loan, the relevant documents entered into in connection with the
issuance of such Covered Loan, including without limitation the relevant loan application and
agreement; promissory note; escrow agreement; beneficiary pledge agreement; assignment of life
insurance policy as collateral; guaranty; trust disclosure statement, representations and
warranties, and consent; authorization and direction to provide death certificate; limited specific
power of attorney; authorization forms for use and disclosure of health information; brokers rights
of agent; limited power of attorney; hold harmless agreement; insured disclosure statement,
representations and warranties, and consent; representations, warranties and covenants of agent;
single case agreement; contact form, notifier letter, assignment of beneficial interest; fee
agreement and the form of trust or model trust provisions, in each case in the form provided to the
Insurer on the Effective Date.



“Loan State” shall have the meaning set forth in Section 1(a)(viii).



“Loan State Local Counsel Questions” shall have the meaning set forth in Section
1(a)(viii).



“Local Counsel Opinion” shall have the meaning set forth in Section 1(a)(viii).



“Losses” shall have the meaning set forth in Section 3.



“LPIC Insurers” and “LPIC Insurer” shall have the meaning set forth in Preamble.



“Master Participation Agreement” shall have the meaning set forth in the Preamble.



“Non-Corporate Trustee” means any trustee or co-trustee of a Retail Borrower other than a
Corporate Trustee.



“Non-material Modification” shall have the meaning set forth in Section 1(a)(vii).







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BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.





“PFSC” means Portfolio Financial Servicing Company, a Delaware corporation.



“Policy” shall have the meaning set forth in Preamble.



“Policy State” shall have the meaning set forth in Section 1(a)(ix).



“Policy State Local Counsel Questions” shall have the meaning set forth in Section
1(a)(ix).



“Reimbursable Loss” shall have the meaning set forth in Section 2(a).



“Servicer” means the company that serves as servicer or back-up servicer for the Retail
Lender, which company shall initially be PFSC.



“Services and Remarketing Agreement” shall have the meaning set forth in Section 3(a).



“USA Patriot Act” shall have the meaning set forth in Section 1(a)(xviii).



“We” or the “Company” shall have the meaning set forth in Preamble.





	13.	 	Assignment. This Letter Agreement may not be assigned by any party without the prior
written consent of each other party hereto, which consent shall not be unreasonably withheld,
conditioned or delayed; provided, that the Insurer may assign this Letter Agreement, without
the need to obtain the prior written consent of the Company or the Contingent LPIC Insurer, to
any entity to whom the Insurer assigns the Policy and the Contingent Insurer may assign this
Letter Agreement, without the need to obtain the prior written consent of the Company or the
Insurer, to any entity to whom the Contingent Insurer assigns the Contingent Policy.





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BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.



     Please confirm that the foregoing correctly sets forth the terms of our agreement by executing
this Letter Agreement and returning it to us.



	 	 	 	 	 
	 	Sincerely,



IMPERIAL HOLDINGS LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



	 	 	 	 	 
	AGREED TO AND ACCEPTED BY:


LEXINGTON INSURANCE COMPANY

 	 	 	 
	By:  	 	 	 
	 	Name:  	 	 	 
	 	Title:  	Authorized Representative 	 	 
	 
	NATIONAL FIRE & MARINE INSURANCE COMPANY

 	 	 
	By:  	 	 	 
	 	Name:  	 	 	 
	 	Title:  	 	 	 
	 



Signature Page to Letter Agreement




 











 





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BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.



EXHIBIT A




COPY OF POLICY



(see attached)



 









 





[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.



STRICTLY CONFIDENTIAL AND PROPRIETARY




LEXINGTON INSURANCE COMPANY




100 Summer Street

Boston, Massachusetts 02110



THIS CONTRACT IS REGISTERED AND DELIVERED AS A SURPLUS LINE COVERAGE UNDER THE SURPLUS LINE
INSURANCE LAW O.C.G.A. CHAPTER 33-5.




LENDER PROTECTION INSURANCE POLICY




POLICY NUMBER: 7113491



DECLARATIONS




	 	 	 

	Item 1. Insured’s Name:

	 	Imperial PFC Financing II, LLC
	 
	 	 
	Insured’s Address:

	 	191 Peachtree Street NE

Suite 3300

Atlanta, Georgia 30303

Attention: David Manchester
	 
	 	 
	Item 2. Effective Date:

	 	September 14, 2009
	 
	 	 
	Item 3. Term:

	 	Continuous from the Effective Date until the
earlier of: (i) the date of the third (3rd)
anniversary of the Effective Date or (ii) the
date this Policy is terminated (See “Section
VI — Termination And Prohibited Acts” for
more detail regarding termination.)
	 
	 	 
	Item 4. Limit of Liability:

	 	For each Covered Loan, the Limit of Liability
shall be the amount set forth as such in the
applicable Coverage Certificate.
	 
	 	 
	Item 5. LPIC Premium:

	 	For each Covered Loan, the LPIC Premium shall
be the amount set forth as such in the
applicable Coverage Certificate.
	 
	 	 
	 

	 	Terrorism Coverage Premium: zero (0).







All LPIC Premium is exclusive of any premium tax, any intermediary commission and any other
applicable taxes, fees or surcharges, all of which (if applicable) shall be the sole responsibility
of the Insured or its Surplus Lines Broker.



	 	 	 

	Item 6. Surplus Lines Broker:

	 	William Lee Mershon
	 
	 	 
	Mailing Address:

	 	Hays Companies

80 S. 8 th Street, Suite 700

Minneapolis, MN 55402
	 
	 	 
	License No.:

	 	Georgia License No. 665715





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[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.





	 	 	 

	Item 7. Attachments:

	 	Exhibit A — Form of Coverage Certificate

Exhibit B — Form of Proof of Loss
	 

	 	Exhibit 1 — Calculation of Outstanding Loan
Balance
Exhibit C — Form of Application For Lender Protection Insurance Coverage






	 	 	 	 	 
	 	LEXINGTON INSURANCE COMPANY

 	 
	 	By:  	 	 
	 	 	Authorized Representative 	 
		 	Signed on September 14, 2009 	 



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[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.



POLICYHOLDER NOTICE



Thank you for purchasing insurance from a member company of American International Group,
Inc. (AIG). The AIG member companies generally pay compensation to brokers and independent agents,
and may have paid compensation in connection with your policy. You can review and obtain
information about the nature and range of compensation paid by AIG member companies to brokers and
independent agents in the United States by visiting our website at
www.aigproducercompensation.com or by calling AIG at 1-800-706-3102.




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[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.



POLICYHOLDER DISCLOSURE




NOTICE OF TERRORISM INSURANCE COVERAGE

(APPLICABLE TO CERTIFIED AND NON-CERTIFIED ACTS)


                                        Insurance Act, as amended, that you have a right to purchase insurance coverage for losses
resulting from acts of terrorism, as defined in Section 102(1) of the Act: The term
“act of terrorism” means any act that is certified by the Secretary of the Treasury—in concurrence
with the Secretary of State, and the Attorney General of the United States—to be an act of
terrorism; to be a violent act or an act that is dangerous to human life, property, or
infrastructure; to have resulted in damage within the United States, or outside the United States
in the case of certain air carriers or vessels or the premises of a United States mission; and to
have been committed by an individual or individuals as part of an effort to coerce the civilian
population of the United States or to influence the policy or affect the conduct of the United
States Government by coercion.



YOU SHOULD KNOW THAT WHERE COVERAGE IS PROVIDED BY THIS POLICY FOR LOSSES RESULTING FROM CERTIFIED
ACTS OF TERRORISM, SUCH LOSSES MAY BE PARTIALLY REIMBURSED BY THE UNITED STATES GOVERNMENT UNDER A
FORMULA ESTABLISHED BY FEDERAL LAW. HOWEVER, YOUR POLICY MAY CONTAIN OTHER EXCLUSIONS WHICH MIGHT
AFFECT YOUR COVERAGE, SUCH AS AN EXCLUSION FOR NUCLEAR EVENTS. UNDER THE FORMULA, THE UNITED STATES GOVERNMENT GENERALLY REIMBURSES
85% OF COVERED TERRORISM LOSSES EXCEEDING THE STATUTORILY ESTABLISHED DEDUCTIBLE PAID BY THE
INSURANCE COMPANY PROVIDING THE COVERAGE. THE PREMIUM CHARGED FOR THIS COVERAGE IS PROVIDED BELOW
AND DOES NOT INCLUDE ANY CHARGES FOR THE PORTION OF LOSS THAT MAY BE COVERED BY THE FEDERAL
GOVERNMENT UNDER THE ACT.



YOU SHOULD ALSO KNOW THAT THE TERRORISM RISK INSURANCE ACT, AS AMENDED, CONTAINS A $100 BILLION CAP
THAT LIMITS U.S. GOVERNMENT REIMBURSEMENT AS WELL AS INSURERS’ LIABILITY FOR LOSSES RESULTING FROM
CERTIFIED ACTS OF TERRORISM WHEN THE AMOUNT OF SUCH LOSSES IN ANY ONE CALENDAR YEAR EXCEEDS $100
BILLION. IF THE AGGREGATE INSURED LOSSES FOR ALL INSURERS EXCEED $100 BILLION, YOUR COVERAGE MAY BE
REDUCED.




Acceptance or Rejection of Terrorism Insurance Coverage




	 	 	 

	þ

	 	I hereby elect to purchase terrorism coverage for a prospective premium of $-0-
	 
	 
	 	I hereby decline to purchase terrorism coverage for certified acts of terrorism.
I understand that I will have no coverage for losses resulting from certified
acts of terrorism. I further understand that by declining to purchase coverage
for certified acts of terrorism, I am also declining to purchase coverage for
non-certified acts of terrorism. This will be reflected in the policy by
Terrorism Exclusion — Form No. 96554(2/08).      (






	 	 	 

	 	 	 
	Policyholder/Applicant’s Signature
	 	 
	 
	IMPERIAL PFC FINANCING II, LLC

	 	September 11 , 2009
	 
	 	 
	Policyholder/Applicant’s Printed Name

	 	Date






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BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.



LEXINGTON INSURANCE COMPANY

100 Summer Street




Boston, Massachusetts 02110




	THIS CONTRACT IS REGISTERED AND DELIVERED AS A SURPLUS LINE COVERAGE UNDER THE SURPLUS LINE
INSURANCE LAW O.C.G.A. CHAPTER 33-5.





LENDER PROTECTION INSURANCE POLICY

POLICY NUMBER: 7113491



In consideration of the Insurer’s receipt of the LPIC Premium, in reliance on the
representations, warranties, acknowledgements and covenants of the Insured contained herein, and
in accordance with and subject to the terms, conditions, limitations and exclusions contained
herein, including the Declarations, Coverage Certificates and any exhibits, schedules,
endorsements or other documents attached hereto or incorporated herein by reference, which
together shall constitute this Lender Protection Insurance Policy (this “Policy”),
Lexington Insurance Company (the “Insurer”) and Imperial PFC Financing II, LLC (the
“Insured”) agree as follows:




Section I. Insuring Agreement and Loss Calculation



Subject to the terms and conditions of this Policy:



This Policy covers loss arising in respect of Coverage Certificates issued by the Insurer to the
Insured during the Term of this Policy. If the Outstanding Loan Balance applicable to any
Covered Loan is greater than zero (0) on the date the Insured or the LPIC Servicer submits a
related Proof of Loss to the Insurer in accordance with Section IV.C, then the Insurer
shall, within thirty (30) days after its receipt of such related Proof of Loss, pay to the
Insured, via electronic funds transfer to the Insured’s Account the applicable Outstanding Loan
Balance as of the related Payment Date. For the avoidance of doubt, a Proof of Loss may only be
delivered to the Insurer on or after the Loss Notification Date.



For purposes of this Policy, “Outstanding Loan Balance” means, for each Covered Loan, an
amount equal to the sum of (i) the applicable Covered Loan Amount (as adjusted downward, on a
dollar for dollar basis, if the amount of covered life insurance premium actually borrowed under
such Covered Loan as of such calculation date is less than the Covered Life Insurance Premium)
plus (ii) the applicable Aggregate Interest Amount (adjusted, if necessary, in accordance with
Section IV.C) minus (iii) the applicable Covered Loan Settlement-Related Amount.



For the avoidance of doubt, if any premium in excess of the Total Life Insurance Premium is paid
to a Life Insurance Carrier with respect to a Covered Policy for the purpose of (a) keeping such
Covered Policy in force beyond the sixtieth (60th) day after the Maturity Date to the
extent required by this Policy or (b) complying with Section IV.D(2), then such excess
premium shall not be included in the calculation of Outstanding Loan Balance unless (i) the
Insurer shall have agreed in writing to include such excess premium in the calculation of
Outstanding Loan Balance and (ii) the Insured shall have paid to the Insurer any applicable
additional LPIC Premium required in consideration of the Insurer’s agreement to do so.




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OF THE SECURITIES ACT OF 1933, AS AMENDED.








Notwithstanding anything to the contrary, payment of loss under this Policy shall only be
made in full compliance with all United States of America economic or trade sanction laws or
regulations, including without limitation sanctions, laws and regulations administered and
enforced by the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”).




Section II. Limit of Liability



With respect to each Covered Loan, the Limit of Liability is the maximum amount that the Insurer
will pay under this Policy.




Section III. LPIC Premium





	A.	 	With respect to each Covered Loan, the Insurer’s receipt of the LPIC Premium on or before
the related Coverage Certificate Effective Date is a condition precedent to any coverage
being provided by this Policy for such Covered Loan; provided, however, that the Insurer’s
receipt of such LPIC Premium no later than one (1) Business Day following the related
Coverage Certificate Effective Date shall be deemed to satisfy such condition precedent
with regard to the related Covered Loan.
	 
	B.	 	All LPIC Premium shall be paid to the Insurer by wire transfer in immediately available
funds, free and clear of any setoff, counterclaim or other deduction.
	 
	C.	 	All LPIC Premium is exclusive of any premium tax, any intermediary commission and any
other applicable taxes, fees or surcharges, all of which (if applicable) shall be the sole
responsibility of the Insured or its Surplus Lines Broker.
	 
	D.	 	All LPIC Premium shall be fully earned upon receipt by the Insurer and nonrefundable,
provided that, the Insurer shall return to the Insured any LPIC Premium as required
pursuant to Section XI.N.





Section IV. Conditions Precedent to Coverage; Conditions to Payment of Outstanding Loan Balance



With respect to each Covered Loan and each applicable Covered Policy (including any applicable
Covered Policy that qualifies as an Exempt Covered Policy), the inception of coverage under this
Policy is subject to satisfaction of the conditions precedent that:





	 	(i)	 	The Insured has purchased (a) participations in the related Retail Loan pursuant
to the Master Participation Agreement or (b) the related Retail Loan pursuant to the
Insurance Premium Loan Sale and Assignment Agreement, such that such participations or
such Retail Loan qualifies as a Covered Loan; and
	 
	 	(ii)	 	The Insurer shall have issued the applicable Coverage Certificate and received
the applicable LPIC Premium in accordance with Section III — LPIC Premium.




With respect to each Covered Loan and each applicable Covered Policy (including any applicable
Covered Policy that qualifies as an Exempt Covered Policy), and provided that the conditions
precedent to the inception of coverage that are set forth in the preceding paragraph have been
satisfied, the Insurer’s obligation to pay any applicable Outstanding Loan Balance is




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OF THE SECURITIES ACT OF 1933, AS AMENDED.





subject to satisfaction of the following conditions precedent:





	A.	 	For each applicable Covered Policy, an amount of premium shall have been paid to the
applicable Life Insurance Carrier so that such Covered Policy has remained continuously in
force through the sixtieth (60th) day after the related Maturity Date. Notwithstanding the
foregoing, this condition precedent shall be deemed to be satisfied with respect to a
Covered Policy if the aggregate amount of premium paid to the applicable Life Insurance
Carrier prior to the lapse of such Covered Policy equaled or exceeded the Total Life
Insurance Premium set forth in the related Coverage Certificate.
	 
	B.	 	For any Covered Policy for which a Bankruptcy-Related Failure to Sell has occurred, the
Insured or the LPIC Servicer or any other Person (other than the Insurer) shall have paid
or caused to be paid all premiums necessary to keep such Covered Policy in force for the
period extending from the [*] ([*]th) day after the Maturity Date up to and
including the [*] ([*]th) day after the Maturity Date; provided, that the
Insurer may, in its sole discretion, waive this condition precedent, by express notice of
waiver in writing to the Insured, following the Insurer’s evaluation of the relevant
Covered Policy for which a Bankruptcy-Related Failure to Sell has occurred.
	 
	C.	 	The Insured or the LPIC Servicer shall have submitted to the Insurer, on or before the
[*] ([*]th) day after the related Loss Notification Date, but no earlier than
the Loss Notification Date (the “Proof of Loss Due Date”), a Proof of Loss
relating to such Covered Loan; provided that:






	 	(1)	 	if, on or prior to the Proof of Loss Due Date, the Insured or the LPIC
Servicer submits a Proof of Loss, or a document that would qualify as a Proof of
Loss but for the fact that such document is not properly completed and duly
executed, and if the Insurer notifies the Insured that such document was not
properly completed and/or duly executed, and if the Insured or the LPIC Servicer
submits a properly completed and duly executed replacement Proof of Loss to the
Insurer within [*] ([*]) Business Days after the Insured’s receipt of such
notification from the Insurer, then in each case the relevant period of time for
purposes of calculating the applicable Aggregate Interest Amount will end on the
Payment Date;
	 
	 	(2)	 	if, on or prior to the Proof of Loss Due Date, the Insured or the LPIC
Servicer submits a document that would qualify as a Proof of Loss but for the fact
that such document is not properly completed and duly executed, and if the Insurer
notifies the Insured that such document was not properly completed and/or duly
executed, but neither the Insured nor the LPIC Servicer submits a properly
completed and duly executed Proof of Loss to the Insurer within [*] ([*]) Business
Days after the Insured’s receipt of such notification from the Insurer, then the
relevant period of time for purposes of calculating the applicable Aggregate
Interest Amount will end on the Proof of Loss Due Date; and
	 
	 	(3)	 	if the Insured or the LPIC Servicer submits a Proof of Loss to the
Insurer after the Proof of Loss Due Date but on or before the [*]
([*]th) day after the Loss Notification Date, then the relevant period
of time for purposes of calculating the applicable Aggregate Interest Amount will
end on the Proof of Loss Due Date.






	 	 	For the avoidance of doubt, if the Insured or the LPIC Servicer submits a Proof of Loss





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OF THE SECURITIES ACT OF 1933, AS AMENDED.







	 	 	to the Insurer after the Proof of Loss Due Date but prior to the date by which a
Proof of Loss must be submitted to the Insurer to avoid the related loss being excluded
from coverage under this Policy in accordance with Section V.D, then the related
Outstanding Loan Balance shall be payable under this Policy but shall reflect the
adjustment to the calculation of the Aggregate Interest Amount referenced in (2) and (3)
above, as applicable.






	 	 	A Proof of Loss or replacement Proof of Loss that is submitted by the Insured to the
Insurer pursuant to this Section IV.C. shall be deemed to be properly completed
and duly executed by the Insured absent written notice to the contrary sent by the
Insurer to the Insured within [*] ([*]) Business Days of the Insurer’s receipt of such
Proof of Loss or replacement Proof of Loss.






	 	 	Notwithstanding anything to the contrary in subsections (1), (2) and (3) above of this
Section IV.C, with respect to each Covered Policy that is not an Exempt Covered
Policy, if the Unencumbered Covered Policy Date applicable to such Covered Policy occurs
on a day that is after the [*] ([*]th) day following the Maturity Date of the
related Covered Loan, but that is on or before the [*] ([*]th) day after the
Maturity Date of the related Covered Loan, then the relevant period of time for purposes
of calculating the applicable Aggregate Interest Amount will end on the [*]
([*]th) day following the Maturity Date of the related Covered Loan.






	D.	 	With regard to each Covered Policy that is not an Exempt Covered Policy:






	 	(1)	 	the Insured (or the Collateral Agent on its behalf) shall have obtained
rights in such Covered Policy, or in the related Beneficial Interest (provided that
nothing prohibits the Insured, or any other Person to whom the Beneficial Interest
is transferred, from having such Covered Policy removed from the related Trust and
transferred to the Insured or such other Person), to the extent necessary to cause
such Covered Policy or such Beneficial Interest to be sold or otherwise disposed of
free and clear of any lien or encumbrance (the date on or after the related
Maturity Date on which such rights have been obtained by the Insured or the
Collateral Agent, the “Unencumbered Covered Policy Date”; provided that, if
such rights were obtained by the Insured or the Collateral Agent prior to the
related Maturity Date, the Unencumbered Covered Policy Date shall be deemed to be
the related Maturity Date);
	 
	 	(2)	 	on the related Unencumbered Covered Policy Date, such Covered Policy must
be in force and remain in force for a minimum of [*] ([*]) consecutive days
thereafter without any additional premium payments required (other than any
additional premium payments, if any, that have already been paid prior to such
Unencumbered Covered Policy Date); and
	 
	 	(3)	 	within five (5) Business Days after the Unencumbered Covered Policy Date,
the Insured or the LPIC Servicer shall have instructed the Remarketing Agent to
sell or otherwise dispose of such Covered Policy or related Beneficial Interest.






	E.	 	In the event of any foreclosure on, or other transfer of, a Covered Policy or the related
Beneficial Interest in satisfaction of a Covered Loan (provided that nothing prohibits the
Insured, or any other party to whom the Beneficial Interest is transferred, from having





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OF THE SECURITIES ACT OF 1933, AS AMENDED.





such Covered Policy removed from the related Trust and transferred to the Insured or such other
party), then (i) the Insured shall have instructed the Remarketing Agent to sell or otherwise
dispose of such Covered Policy or such Beneficial Interest, (ii) the Insured, upon request of the
Remarketing Agent, shall have delivered to the Remarketing Agent or the purchaser of such Covered
Policy or such Beneficial Interest all documentation relating thereto and (iii) the Insured shall
not have instructed, caused or permitted any Person other than the Remarketing Agent to sell or
otherwise dispose of such Covered Policy or such Beneficial Interest.





	F.	 	If the Remarketing Agent has not sold a Covered Policy or related Beneficial Interest on or before the related Loss Notification Date, then:






	 	(1)	 	if the Insurer notifies the Insured in writing that the Insurer is requiring transfer
of the ownership of the Covered Policy or related Beneficial Interest to the Insurer
or a third party designated by the Insurer, then the Insured shall deliver to the
Insurer or such third party, on or before the Payment Date, either (a) in the
event that such notification from the Insurer requires the ownership of the
Covered Policy to be transferred, evidence that: (i) the Insured has filed, or if
the Insured is not authorized to so file, has caused the relevant party so
authorized to file, in accordance with the terms of such Covered Policy, a change
of ownership form with the Life Insurance Carrier that issued such Covered Policy
requesting the ownership of such Covered Policy be changed to the Insurer or such
third party, (ii) the secured party(ies) under each security agreement,
collateral assignment and/or other instrument, agreement or document granting a
lien or other encumbrance on such Covered Policy or the proceeds thereof shall
have assigned to the Insurer or its designee or otherwise released, on
commercially reasonable terms acceptable to the Insurer, all of its rights as a
secured party with respect to such Covered Policy and the proceeds thereof under
such security agreement, collateral assignment and/or other instrument, agreement
or document, (iii) the Insured has taken all commercially reasonable and lawful
actions to cause the relevant Life Insurance Carrier to issue a verification of
coverage indicating that ownership of such Covered Policy has been changed to the
Insurer or such third party designee, along with the original Covered Policy and
all amendments and endorsements thereto and any other documentation related to
such Covered Policy (but no verification of coverage need have been issued at
that time) and (iv) solely if received by the Insured on or prior to the Payment
Date, a verification of coverage issued by the Life Insurance Carrier indicating
that ownership of such Covered Policy has been changed to the Insurer or such
third party designee; or (b) in the event that such notification from the Insurer
requires ownership of the related Beneficial Interest to be transferred (provided
that nothing shall prohibit the Insurer, a third party designated by the Insurer
or any other party to whom the related Beneficial Interest is transferred, from
having such Covered Policy removed from the related Trust and transferred to the
Insurer, such third party designee of the Insurer or such other party), (i)
evidence, in the form of an agreement among all of the beneficiaries of the
related Trust, each Trustee and each co-Trustee thereof that ownership of the
related Beneficial Interest has been changed to the Insurer or such third party
designee and that each Trustee and each co-Trustee of the Trust has agreed not to
take action with regard to the Trust or such Covered Policy without the prior
consent of the Insurer or such third party designee, (ii) evidence that the
secured





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OF THE SECURITIES ACT OF 1933, AS AMENDED.




party(ies) under each security agreement, collateral assignment and/or other
instrument, agreement or document granting a lien or other encumbrance on such Beneficial
Interest or the related Covered Policy or the proceeds thereof have assigned to the Insurer
or its designee or otherwise released, on commercially reasonable terms acceptable to the
Insurer, all of its rights as a secured party with respect to such Beneficial Interest and
such related Covered Policy and the proceeds thereof under such security agreement,
collateral assignment and/or other instrument, agreement or document, (iii) the Insured has
taken all commercially reasonable and lawful actions to cause the relevant Life Insurance
Carrier to issue a verification of coverage indicating that ownership of such Covered
Policy resides with the Trust (but no verification of coverage need have been issued at
that time), (iv) solely if received by the Insured on or prior to the Payment Date, a
verification of coverage issued by the Life Insurance Carrier indicating that ownership of
such Covered Policy resides with the Trust, (v) the related Trust certificate, if any, and
(vi) copies of each Trustee’s and each coTrustee’s books and records that reflect that the
Insurer or its third party designee is the sole beneficiary of the Trust; and





	(2)	 	if the Insurer notifies the Insured in writing that the Insurer is not requiring
transfer of ownership of such Covered Policy or the related Beneficial Interest
to the Insurer or a third party designated by the Insurer, but is requesting the
cooperation of the Insured and the Collateral Agent with regard to such Covered
Policy and, if applicable, the related Beneficial Interest, then (a) the Insured
shall, on and after the Payment Date, maintain rights in such Covered Policy or
such Beneficial Interest to the extent necessary to cause such Covered Policy or
such Beneficial Interest to be sold or otherwise disposed of free and clear of
any lien or encumbrance and (b) the Insured and the LPIC Servicer shall take all
other commercially reasonable and lawful actions requested by the Insurer in
connection with such Covered Policy and, if applicable, such related Beneficial
Interest, including without limitation the payment of additional premiums on such
Covered Policy (it being understood that any such actions requested by the
Insurer, including without limitation any payment of premiums required to keep
the Covered Policy in force, shall be undertaken by the Insured and the
Collateral Agent at the expense of the Insurer).




If the Insurer notifies the Insured in writing that the Insurer is not requiring transfer
of ownership of such Covered Policy or the related Beneficial Interest to the Insurer or
a third party designated by the Insurer and is not requiring the cooperation of the
Insured or the Collateral Agent with regard to such Covered Policy or such related
Beneficial Interest, then the Insured and the Collateral Agent shall not have any
obligations under this Section IV.F.




Section V. Exclusions





	A.	 	This Policy does not apply to, and the Insurer shall not be liable hereunder for, any loss
relating to a Coverage Certificate or any increase in the Outstanding Loan Balance if
such loss or increase was caused by acts of a Responsible Party that, at the time such
acts were taken, were fraudulent, illegal, criminal, malicious or grossly negligent acts.
For clarification purposes, a misrepresentation by an Underlying Life or its agent to a
Life Insurance Carrier with respect to a Covered Policy shall not be “caused by” the acts
of a





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	 	 	Responsible Party.
	 
	B.	 	This Policy does not apply to, and the Insurer shall not be liable hereunder for, any
loss relating to a Coverage Certificate if, at any time after the issuance of such
Coverage Certificate, there is a policy loan, or cash withdrawal under a related Covered
Policy or a surrender of such Covered Policy to the issuing Life Insurance Carrier or a
sale of such Covered Policy or related Beneficial Interest on or before the related
Maturity Date, which policy loan, cash withdrawal, surrender or sale occurs before the
Insured’s receipt of the Insurer’s written consent to such policy loan, cash withdrawal,
surrender or sale.
	 
	C.	 	This Policy does not apply to, and the Insurer shall not be liable hereunder for, any
loss relating to a Coverage Certificate if the Unencumbered Covered Policy Date for any
related Covered Policy (other than an Exempt Covered Policy) occurs subsequent to the [*]
([*]th) day after the Maturity Date of the related Covered Loan.
	 
	D.	 	The Insurer shall not be liable hereunder for any loss relating to a Coverage
Certificate if the Insured or the LPIC Servicer (i) fails to submit a Proof of Loss to the
Insurer on or prior to [*] ([*]) days after the Loss Notification Date or (ii) (a) submits
to the Insurer, on or prior to [*] ([*]) days after the Loss Notification Date, a document
that would qualify as a Proof of Loss but for the fact that such document is not properly
completed and duly executed, (b) is notified in writing by the Insurer that such document
was not properly completed and/or duly executed (which written notice shall describe in
reasonable detail the portion or portions of such Proof of Loss not so completed or
executed) and (c) fails to submit a replacement Proof of Loss to the Insurer by the later
of (x) [*] ([*]) days after the Loss Notification Date and (y) [*] ([*]) Business Days
after the Insured’s receipt of such notification from the Insurer.
	 
	E.	 	This Policy shall not apply to, and the Insurer shall not be liable hereunder for, any
loss relating to a Coverage Certificate if a Responsible Party (i) obtains actual
knowledge that either (x) a Prohibited Act was committed by any Person in connection with
any Covered Policy related to such Coverage Certificate or (y) any Covered Loan related to
such Coverage Certificate failed at any time to comply in any material respect with any
applicable laws, statutes, rules or regulations (other than in a circumstance in which the
disclosure of such information to the Insurer is prohibited by court order, law or
regulation) and (ii) fails to provide written notice to the Insurer within thirty (30)
days after obtaining such actual knowledge as set forth in part (i).
	 
	F.	 	This Policy shall not apply to, and the Insurer shall not be liable hereunder for, any
loss relating to a Coverage Certificate if the Insured or any Person appointed by the
Insured to perform any duties on behalf of the Insured in connection with this Policy
shall refer any claim to the Insurer knowing the same to be fraudulent.
	 
	G.	 	This Policy does not apply to, and the Insurer shall not be liable hereunder for, any
loss relating to a Coverage Certificate if the related Covered Policy was Contested before
the Coverage Certificate Effective Date and any Responsible Party or any of its respective
Authorized Officers had actual knowledge of the Contest before the Coverage Certificate
Effective Date.





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[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.








Section VI. Termination and Prohibited Acts





	A.	 	This Policy shall be continuous from the Effective Date until the earlier of: (i) the
date of the third (3rd) anniversary of the Effective Date or (ii) the date this Policy is
terminated pursuant to this Section VI. Notwithstanding any other provision of
this Policy, each of the Insurer and the Insured shall have the right to terminate this
Policy by providing written notice to the other party, and such termination shall be
effective ten (10) Business Days after the date of receipt of such written notice by
such other party. Except as otherwise provided in this Section VI, termination
of this Policy shall not affect (i) the insurance provided by any Coverage Certificate
issued by the Insurer prior to the effective date of such termination or (ii) the
confidentiality provisions set forth in Section X, which shall survive the
termination of this Policy.






	B.	 	For purposes of this Policy, the term “Prohibited Act” means:






	 	(1)	 	in connection with the issuance of a Covered Policy by a Life Insurance Carrier
and/or for the purpose of encouraging the issuance of or application for such
Covered Policy or a loan supported directly or indirectly by such Covered Policy,
providing any upfront inducement or gift valued in excess of $150 or otherwise in
violation of applicable law for the benefit of a borrower, any beneficiary or
owner thereof and/or the Underlying Life and/or the spouse or significant other
of the Underlying Life; provided that the conduct described in following
provisions (a) and (b) shall not constitute an upfront inducement or gift for
purposes of this clause (1) so long as such conduct does not violate applicable
law:






	 	(a)	 	conduct that does not result in the Retail Borrower being
entitled to borrow amounts under the related Retail Loan that exceed the aggregate
sum of: (i) the amount of life insurance premium previously paid, or that
will be paid by such Retail Borrower thereafter in accordance with such
Retail Loan, in order to keep the related Covered Policy in force from
the date of issuance thereof through the 60th day after the
related Maturity Date, (ii) the related LPIC Premium, (iii) the related
Contingent LPIC Premium and (iv) costs and expenses that such Retail
Borrower has incurred in connection with the related Retail Loan or has
previously paid in respect of such Covered Policy or a loan supported by
such Covered Policy; and/or
	 
	 	(b)	 	any reasonable business marketing activity, event or meal
conducted by any employee or Authorized Officer of the Retail Lender or any Affiliate
thereof or a Responsible Party for the benefit of the Retail Borrower,
any beneficiary of the Retail Borrower, and/or the Underlying Life and/or
the spouse or significant other of the Underlying Life, and paid for by
the Retail Lender or any Affiliate thereof or a Responsible Party without
any condition that the recipient or beneficiary thereof purchase or
finance any insurance;






	 	(2)	 	in connection with the issuance of a Covered Policy by a Life Insurance Carrier
or the issuance or maintenance of a loan supported directly or indirectly by a
Covered Policy, causing any portion of the death benefit from such Covered
Policy to be paid to parties other than (a) those with an insurable interest in the





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OF THE SECURITIES ACT OF 1933, AS AMENDED.










	 	 	 	Underlying Life, (b) beneficiaries chosen by the Underlying Life (in any
case, other than the Retail Lender or any Affiliate thereof, a Responsible Party
or any Authorized Officer of any of the foregoing) or (c) the Retail Lender in
satisfaction of the related Covered Loan; provided that, the amount
collected by the Retail Lender may not exceed the outstanding loan principal,
together with related interest and reasonable and customary charges or fees; and
provided further that if (i) the aggregate amount of charges and fees with regard
to such Covered Loan, other than LPIC Premium, does not exceed ten percent (10%)
of the Covered Loan Amount or (ii) no LPIC Premium is charged directly to the
Retail Borrower and identified as such under a Covered Loan, the aggregate amount
of charges and fees with regard to such Covered Loan does not exceed the sum of
ten percent (10%) of the Covered Loan Amount plus the amount of LPIC Premium paid
in connection with such Covered Loan, then such charges and fees shall be
considered reasonable and customary for purposes of this clause (2);






	 	(3)	 	in connection with the issuance of a Covered Policy by a Life Insurance
Carrier or the issuance or maintenance of a loan supported directly or indirectly
by a Covered Policy, requiring a borrower to sell, assign (other than through a
pledge of such Covered Policy or related Beneficial Interest as collateral and any
foreclosure or liquidation of such collateral to satisfy such loan and related
amounts) or settle such Covered Policy that acts as collateral or penalizing such
borrower for not selling, assigning or settling any such Covered Policy;
	 
	 	(4)	 	in connection with the issuance of a Covered Policy by a Life Insurance
Carrier or the issuance or maintenance of a loan supported directly or indirectly
by a Covered Policy, (a) requiring a borrower to share or otherwise forfeit any
proceeds derived from the future sale, assignment or settlement of such Covered
Policy (other than through a pledge of such Covered Policy or related Beneficial
Interest as collateral and any foreclosure or liquidation of such collateral to
satisfy a loan and related amounts); it being understood that no part of this
clause (a) is intended to allow the use of an interest rate that (i) is not fixed,
(ii) is not correlated to a commercially accepted index or instrument (such as
“Libor”, “prime” or a U.S. treasury bill) or (iii) may otherwise result in any
Person paying or owing any amount contingent upon the future value or sale price of
a Covered Policy or (b) requiring a borrower to consummate any such sale,
assignment or settlement with a particular agent or settlement company; or
	 
	 	(5)	 	in connection with the issuance of a Covered Policy by a Life Insurance
Carrier or the issuance or maintenance of a loan supported directly or indirectly
by a Covered Policy, penalizing a borrower for prepaying any such loan other than
pursuant to a market prepayment penalty, make whole premium or early termination
fee; provided that a prepayment penalty, make whole premium or early
termination fee that (i) is consistent with the “Yield Maintenance Premium” set
forth in the Retail Loan Documents and in any event (ii) does not result in the
borrower paying more than it would have paid in full satisfaction of the Covered
Loan at maturity shall be considered a market prepayment penalty, make whole
premium or early termination fee for purposes of this clause (5).






	C.	 	If a Responsible Party commits or committed any Prohibited Act in connection with the





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BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.







	 	 	issuance of any Covered Policy, then the Insurer may in its sole discretion
terminate this Policy (or, for the avoidance of doubt, any portion thereof selected by
the Insurer in its sole discretion), such that all insurance under this Policy shall be
null and void ab initio with respect to any and all coverage under all Coverage
Certificates issued by the Insurer pursuant to this Policy, and the Insurer shall have no
obligation to return any LPIC Premium relating to any Coverage Certificate.






	D.	 	If any of the following occur, then the Insurer (i) may in its sole discretion terminate this
Policy (on a going forward basis only), (ii) shall not be required to issue any Coverage
Certificate arising out of any related Application For Lender Protection Insurance
Coverage that may be pending and (iii) shall not be liable hereunder for any loss with
respect to, and shall have no obligation to return any LPIC Premium relating to, any
Coverage Certificate issued pursuant to any related Application for Lender Protection
Insurance Coverage:






	 	(1)	 	an event described in Section VI.C shall occur and the Insurer
elects not to terminate this Policy in accordance with Section VI.C, but
during the period of time from the occurrence of such event to the time when the
Insurer obtained actual knowledge thereof, any Application For Lender Protection
Insurance Coverage was submitted to the Insurer; or
	 
	 	(2)	 	a Responsible Party provides written notice to the Insurer within thirty
(30) days following any Responsible Party obtaining actual knowledge that either
(a) any Prohibited Act was committed by any Person or (b) any Covered Loan failed
at any time to comply in any material respect with any applicable laws, statutes,
rules or regulations (other than in a circumstance in which the Insured’s
disclosure of such information to the Insurer is prohibited by court order, law or
regulation), but during the period of time between when such Responsible Party
obtained such knowledge and when the Insurer obtained such knowledge, any
Application For Lender Protection Insurance Coverage was submitted to the Insurer;






	 	 	provided that, termination of this Policy pursuant to this Section VI.D
shall not affect the insurance provided by any Coverage Certificate (including, without
limitation, any Coverage Certificate issued by the Insurer in response to any Application
For Lender Protection Insurance Coverage submitted to the Insurer after the end of the
period of time referenced in either Section VI.D(1) or Section VI.D.(2)
above, but prior to the commencement of any additional period of time under such
sections) delivered by the Insurer in response to an Application For Lender Protection
Insurance Coverage other than those identified above.






	E.	 	With respect to a Covered Loan, if the Insurer determines that a Person other than a
Responsible Party committed a Prohibited Act relating to such Covered Loan, then the
Insurer:






	 	(1)	 	need not accept future Applications for Lender Protection Insurance
Coverage that relate to such Person or that relate to or involve, directly or
indirectly, such Person’s activities, and
	 
	 	(2)	 	may in its sole discretion cancel all outstanding Applications for Lender





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BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.







	 	 	 	Protection Insurance Coverage (including, for the avoidance of doubt, those
Applications for Lender Protection Insurance Coverage for which a Pre-Certificate
Review Decision Notice has been received by the Insured) that relate to such
Person.






	F.	 	The Insurer’s exercise of its rights under all or any portion of this Section
VI shall not preclude the Insurer from exercising any other rights that it may have
under any other section of this Policy or under any other portion of this Section
VI.
	 
	G.	 	The Insured and the Insurer acknowledge and agree that, notwithstanding anything to the
contrary in the Transaction Documents, upon the occurrence of a Credit Event, (i) the
Insurer shall not issue any Coverage Certificates, whether in respect of any pending
Application For Lender Protection Insurance Coverage or otherwise, (ii) this Policy, as
well as all outstanding Coverage Certificates will terminate automatically without any
further action by any Person, (iii) no LPIC Premium in respect of any previously issued
Coverage Certificate shall be refundable to the Insured and (iv) the Insurer is hereby
released from any and all liabilities and obligations arising out of or related to this
Policy (including without limitation, any outstanding Proof of Loss previously submitted
to the Insurer) and/or any Coverage Certificate issued hereunder.





Section VII. Representations, Warranties, Covenants and Acknowledgements





	A.	 	The Insured represents, warrants and covenants to the Insurer that the Insured (i) has
conducted, and will conduct at all times prior to the termination of all coverage provided
by the Insurer under this Policy, its business relating to the transactions contemplated
by this Policy, the Master Participation Agreement and each Insurance Premium Loan and
Sale Assignment Agreement in all material respects in accordance with all state and
federal laws, statutes, rules and regulations applicable to it and (ii) has obtained all
requisite consents, approvals, authorizations and orders, and made all requisite filings
and registrations and obtained all requisite licenses, qualifications and permits of or
with any court, governmental or regulatory authority, agency or other body that is
necessary for the Insured to conduct of its business relating to the transactions
contemplated by this Policy, the Master Participation Agreement and each Insurance Premium
Loan and Sale Assignment Agreement.
	 
	B.	 	The Insured represents and warrants to the Insurer that the Insured has a place of
business in the State of Georgia at the address set forth in Item 1 of the Declarations
where the Insured administers matters relating to this Policy. The Insured covenants that
the Insured (i) will notify the Insurer promptly in writing of any change to such business
address and (ii) will not discontinue operating such business from such State without
first obtaining written consent from the Insurer.
	 
	C.	 	The Insured represents and warrants to the Insurer that, to the knowledge of the
Insured, the principal place of business of the Collateral Agent for purposes of
administering the transactions contemplated by this Policy is within the state of Oregon.
	 
	D.	 	The Insured represents and warrants to the Insurer that the Insured has obtained a
representation, warranty and covenant from each Retail Lender that all Covered Loans shall
be originated in accordance with the applicable criteria set forth in the Wholesale Loan
Agreement.





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OF THE SECURITIES ACT OF 1933, AS AMENDED.






	E.	 	The Insured represents and warrants to the Insurer that (i) neither the Insured nor any
Person that holds a direct or indirect voting equity interest in the Insured and (ii) to
the knowledge of the Insured, no Responsible Party or any other Person that provides
direct or indirect financial support to or for the benefit of the Insured in respect of
any Covered Loan or any Coverage Certificate and/or any Affiliate, Authorized Officer or
employee of any of the foregoing, is (x) a person or entity listed in the Annex to
Executive Order No. 13224 (2001) issued by the President of the United States (Executive
Order Blocking Property and Prohibiting Transactions with Persons Who Commit, Threaten to
Commit, or Support Terrorism) or (y) named on the List of Specially Designated Nationals
and Blocked Persons maintained by the U.S. Office of Foreign Assets Control.
	 
	F.	 	The Insured shall, upon the Insurer’s request and at the Insured’s expense, provide the
Insurer with identifying information regarding the Insured in connection with the
requirements of the Uniting and Strengthening America by Providing Appropriate Tools
Required to Intercept and Obstruct Terrorism Act of 2001, Pub. L., 107-56, 115 Stat. 380
(October 26, 2001), as amended.
	 
	G.	 	The Insured represents, warrants and covenants to the Insurer that (i) the Insurer’s
identity has not been and shall not be disclosed by the Insured, any Affiliate thereof
or, to the knowledge of the Insured, any Responsible Party in any offering materials or
discussions with rating agencies or any life insurance carrier without the prior written
consent of the Insurer (which consent the Insurer can withhold in its sole and absolute
discretion), (ii) this Policy has not been and shall not be referenced by the Insured or
any Affiliate thereof or, to the knowledge of the Insured, any Responsible Party in any
offering materials or discussions with rating agencies in connection with any rated or
unrated securities offering without the prior written consent of the Insurer (which
consent the Insurer can withhold in its sole and absolute discretion) and (iii) it shall
provide written notice to the Insurer promptly (but in no event later than thirty (30)
days) following the Insured or any Affiliate thereof or any Responsible Party obtaining
actual knowledge that any Prohibited Act has been committed.
	 
	H.	 	The Insured acknowledges that:






	 	(1)	 	The Insurer is a non-admitted insurer that is not licensed to transact
insurance business on an admitted basis in the State of Georgia, and, depending on
applicable law, the Insured may not be entitled to any benefits from the Georgia
Insurer’s Insolvency Pool with respect to this Policy.
	 
	 	(2)	 	The information set forth under the heading “Information Relating to
Covered Loan” in the applicable Coverage Certificate is the information that will
be used in connection with the calculation of the Outstanding Loan Balance and all
other terms and conditions of this Policy.






	I.	 	The Insured covenants to the Insurer that it will provide notice to the Insurer within three
(3) Business Days of obtaining knowledge that any Covered Policy is not current with
respect to the premiums required to keep the Covered Policy in force and also will
provide copies of any notices the Insured receives in that regard.
	 
	J.	 	The Insured covenants to the Insurer that if the Insured or any Affiliate thereof or a
Responsible Party obtains actual knowledge that any Covered Loan failed at any time to





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OF THE SECURITIES ACT OF 1933, AS AMENDED.










	 	 	comply in any material respect with any applicable laws, statutes, rules or
regulations, the Insured shall direct the Retail Lender to take all commercially
reasonable action to remedy such non-compliance.






	K.	 	The Surplus Lines Broker represents, warrants and covenants to the Insurer that it has complied, and will continue to comply, with all requirements of any applicable insurance
code in connection with the procurement of this Policy, including without limitation any applicable requirement relating to the collection and/or payment of taxes, fees
or surcharges.




Any breach of the representations, warranties or covenants set forth in this Section VII
shall not expand the conditions to payment set forth in Section IV or the exclusions to
payment set forth in Section V or otherwise void coverage provided by this Policy.
Subject to the foregoing sentence, each of the Insured and the Surplus Lines Broker acknowledges
that the Insurer is entering into this Policy in reliance upon the genuineness of such
representations, warranties and covenants and the Insurer shall retain all other remedies
available at law or in equity in connection with any such breach.




Section VIII. Definitions





	A.	 	“Additional Collateral” means collateral other than a Covered Policy accepted
by the Retail Lender or the Insured as security for a related Covered Loan for all amounts
in excess of the Covered Loan Amount.
	 
	B.	 	“Affiliate” of any Person means any other Person that (i) directly or
indirectly controls, is controlled by or is under common control with such Person or (ii)
is an officer or director of such Person. A Person shall be deemed to be “controlled by”
any other Person if such other Person possesses, directly or indirectly, power: (i) to
vote 10% or more of the securities (on a fully diluted basis) having ordinary voting power
for the election of directors or managing partners; or (ii) to direct or cause the
direction of the management and policies of such Person whether by contract or otherwise.
	 
	C.	 	“Aggregate Interest Amount” means, for each Covered Loan, interest on that
portion of the Covered Loan Amount advanced on or after the Coverage Certificate Effective
Date accrued from and including the date on which each such advance is made to but
excluding the Payment Date (adjusted, if necessary, in accordance with Section
IV.C), at the per annum Loan Rate, which interest shall be (i) calculated and deemed
to accrue using a simple interest method on the basis of the actual number of days elapsed
over a 360-day year and (ii) capitalized annually on the first day of each year following
the date on which each such advance is made and added to the then outstanding principal
amount of the Covered Loan Amount..
	 
	D.	 	“Application For Lender Protection Insurance Coverage” means a document
substantially in the form set forth in Exhibit C attached hereto, properly
completed and duly executed by the Insured.
	 
	E.	 	“Authorized Officer” means any director, chief executive officer, president,
chief operating officer, chief financial officer, treasurer, general counsel, lead
compliance officer, vice president, or manager of the relevant Person.
	 
	F.	 	“Bankruptcy-Related Failure to Sell” means, for each Covered Policy, that such
Covered





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OF THE SECURITIES ACT OF 1933, AS AMENDED.






	 	 	Policy could not be sold prior to the [*] ([*]th) day after the Maturity
Date as a result of (i) an Event of Bankruptcy with respect to any of the Underlying
Life, the Retail Borrower or any beneficiary of the Retail Borrower or (ii) the automatic
stay relating to such Event of Bankruptcy.






	G.	 	“Beneficial Interest” means the entire beneficial interest in a Trust that holds a Covered Policy.
	 
	H.	 	“Business Day” means any day other than a Saturday, a Sunday or a day on which
commercial banks in New York, New York and Atlanta, Georgia are authorized or required to
be closed for business.
	 
	I.	 	“Collateral Agent” means, for each Covered Loan, the company that serves as
collateral agent for the Lender under the assignment of life insurance policy as
collateral relating to such Covered Loan, which company shall initially be Portfolio
Financial Servicing Company, having its principal place of business at 2121 S.W.
Broadway, Portland, Oregon 97201, and shall not be replaced without the prior written
consent of the Insurer.
	 
	J.	 	“Confidential Information” has the meaning set forth in Section X.A.
	 
	K.	 	“Contestability Determination Documents” means, with respect to each Covered
Policy that is Contested, any and all documentation presented to or received by the
related Trust, the Retail Borrower or the Retail Lender or an agent of any such party from
each Life Insurance Carrier that has issued such Covered Policy in connection with such
Life Insurance Carrier’s Contest of that Covered Policy, including without limitation a
death certificate (if applicable), the document(s) by which such Life Insurance Carrier
informed the related Trust, the Retail Borrower or the Retail Lender of its decision
regarding such Covered Policy and any other documentation that relates to, summarizes or
supports the Life Insurance Carrier’s decision regarding that Covered Policy, which
documentation is required to be attached to the applicable Proof of Loss.
	 
	L.	 	“Contest” or “Contested” means, for each Covered Policy, that the Life
Insurance Carrier has rescinded or contested such Covered Policy (including without
limitation on the basis of a lack of insurable interest) pursuant to a written notice from
the Life Insurance Carrier.
	 
	M.	 	“Contingent LPIC Insurer” means the “Insurer” as defined in the Contingent LPIC
Policy.
	 
	N.	 	“Contingent LPIC Policy” means that certain Contingent Lender Protection
Insurance Policy, Policy No.                     , issued to the Insured by the Contingent LPIC Insurer, effective as of the Effective Date.
	 
	O.	 	“Contingent LPIC Premium” means, for each Covered Loan, the amount set forth as
such in the applicable Coverage Certificate.
	 
	P.	 	“Coverage Certificate” means, for each Covered Loan, a certificate
substantially in the form set forth in Exhibit A attached hereto, issued and duly executed
by the Insurer and pursuant to which coverage under this Policy for such Covered Loan is
provided.
	 
	Q.	 	“Coverage Certificate Effective Date” means, for each Covered Loan, the date
set forth as such in the applicable Coverage Certificate.





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OF THE SECURITIES ACT OF 1933, AS AMENDED.







	R.	 	“Covered Expenses” means, for each Covered Loan, the amount set forth as
such in the applicable Coverage Certificate.
	 
	S.	 	“Covered Life Insurance Premium” means, for any Covered Policy, the amount set
forth as such on the applicable Coverage Certificate.
	 
	T.	 	“Covered Loan” means a loan made by the Retail Lender to a Retail Borrower (i)
in which the Insured has purchased undivided participations pursuant to the Master
Participation Agreement or (ii) that has been purchased by the Insured pursuant to an
Insurance Premium Loan Sale and Assignment Agreement and with respect to which, (x) the
amount of such participations or the portion of the Retail Loan so purchased shall be
equal to the Covered Loan Amount set forth in the applicable Coverage Certificate and (y)
the Insurer shall have issued a Coverage Certificate hereunder.
	 
	U.	 	“Covered Loan Amount” means, for each Covered Loan, the amount set forth as
such in the applicable Coverage Certificate.
	 
	V.	 	“Covered Loan Settlement-Related Amount” means, for each Covered Loan, an
amount equal to the sum of the Settlement Amounts for all Covered Policies related to such
Covered Loan plus the sum of all other amounts paid to the Retail Lender to decrease the
outstanding balance of the related Covered Loan and which the Retail Lender has not been
required to return or repay under any applicable law (including bankruptcy or insolvency
laws), but excluding amounts paid to the Retail Lender to decrease the outstanding balance
of such Covered Loan in an aggregate amount up to but not exceeding the portion of such
Covered Loan secured by Additional Collateral. For purposes of clarification with respect
to a Covered Loan, the surrender, transfer or assignment of ownership of a related Covered
Policy by a Retail Borrower to a related Retail Lender for purposes of satisfying a
Covered Loan shall not be considered to be an amount paid to such Retail Lender to
decrease the outstanding balance of the related Covered Loan, even if such Retail Lender
releases the Retail Borrower or the Underlying Life from liability under the Retail Loan
Documents in connection with such surrender or assignment.
	 
	W.	 	“Covered Policy” means, for each Covered Loan, each life insurance policy that
is identified in the applicable Coverage Certificate by its policy number, which life
insurance policy shall be issued by a Life Insurance Carrier to the applicable Retail
Borrower as owner thereof.
	 
	X.	 	“Credit Event” means, the occurrence of both of (i) and (ii):






	 	(i)	 	the Insurer:






	 	(a)	 	is unable to pay its insurance obligations under this Policy in
full as they become due or admits in writing its inability generally to pay its
insurance obligations under insurance policies in full as they become due, or
	 
	 	(b)	 	enters into liquidation, or
	 
	 	(c)	 	is found to be insolvent in an insolvency proceeding in the
United States or a rehabilitator or other similar official is appointed for all
or substantially all its assets, or





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OF THE SECURITIES ACT OF 1933, AS AMENDED.






	 	(d)	 	becomes subject to a corrective order or similar document issued by an
insurance regulator that cites or otherwise references the Insurer’s financial
impairment or failure to meet minimum levels of statutory capital or surplus
and which prohibits payments of claims as and when due;






	 	 	 	and






	 	(ii)	 	the Insurer does not pay a loss in full when due in connection with a Proof
of Loss submitted by the Insured under this Policy; provided that this
condition (ii) shall not be satisfied if the Insurer has notified the Insured, on or
prior to the date on which such loss payment was due, that the non-payment of all or
part of the loss is due to a reason other than the occurrence of one or more of the
events described in clause (i) above.






	Y.	 	“Death Benefit” means, for any Covered Policy, the amount set forth as such on
the applicable Coverage Certificate.
	 
	Z.	 	“Declarations” means the declaration pages attached to the front of this Policy.
	 
	AA.	 	 “Effective Date” has the meaning set forth in Item 2 of the Declarations.
	 
	BB.	 	

“Event of Bankruptcy” shall be deemed to have occurred with respect to a Person if either:






	 	(a)	 	a case, action or other proceeding shall be commenced, without the
application or consent of such Person, in any court, seeking the liquidation,
reorganization, debt arrangement, dissolution, winding up, or composition or
readjustment of debts of such Person, the appointment of a trustee, receiver,
custodian, liquidator, assignee, sequestrator or the like for such Person or all or
substantially all of its assets, or any similar action with respect to such Person
under any law relating to bankruptcy, insolvency, reorganization, winding up or
composition or adjustment of debts; or an order for relief in respect of such
Person shall be entered in an involuntary case under the federal bankruptcy laws or
other similar laws now or hereafter in effect; or
	 
	 	(b)	 	such Person shall commence a voluntary case or other proceeding under any
applicable bankruptcy, insolvency, reorganization, debt arrangement, dissolution or
other similar law now or hereafter in effect, or shall consent to the appointment
of or taking possession by a receiver, liquidator, assignee, trustee, custodian,
sequestrator (or other similar official) for such Person or for any substantial
part of its property, or shall make any general assignment for the benefit of
creditors, or shall fail to, or admit in writing its inability to, pay its debts
generally as they become due, or, if a corporation or similar entity, its board of
directors shall vote to implement any of the foregoing.






	CC.	 	“Exempt Covered Policy” means, for each Covered Loan, each Covered Policy
that satisfies one or more of the following requirements:






	 	(a)	 	has a pending death claim; or
	 
	 	(b)	 	has been sold (directly through a sale of such Covered Policy or indirectly
through the sale of the Beneficial Interest in a Trust) prior to the Maturity Date
with





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[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.






	 	 	 	the prior written consent of the Insurer; or






	 	(c)	 	a Bankruptcy-Related Failure to Sell has occurred with respect to such
Covered Policy; or
	 
	 	(d)	 	has been Contested by the Life Insurance Carrier; or
	 
	 	(e)	 	is no longer in force because (i) of the death of the related Underlying
Life, (ii) it has been surrendered to the Life Insurance Carrier, or (iii) it has
lapsed on or before the sixtieth (60th) day after the Maturity Date and
such Covered Policy was in force on the date when the aggregate amount of premium
received by the applicable Life Insurance Carrier under such Covered Policy equaled
the Total Life Insurance Premium set forth in the applicable Coverage Certificate.






	DD.	 	“Foreclosed Policy” means, for each Covered Loan, each Covered Policy or the
related Beneficial Interest, the sale or other disposition of which is being effected
through the foreclosure process as a result of the Retail Borrower’s default under such
Covered Loan.
	 
	EE.	 	“Free Look Period” means the period during which a Retail Borrower or its assignee
may, pursuant to the terms of a Covered Policy or applicable law, cancel such Covered
Policy and receive a refund of all premiums previously paid thereunder.
	 
	FF.	 	“Insurance Premium Loan Sale and Assignment Agreement” means an Insurance
Premium Loan Sale and Assignment Agreement between the Retail Lender and the Insured, in
each case in the form provided to the Insurer on the Effective Date and as the same may
be amended, supplemented or otherwise modified from time to time in accordance with the
terms thereof.
	 
	GG.	 	“Insured” has the meaning set forth in the preamble of this Policy.

	 
	HH.	 	 “Insured’s Account” means a bank account of the Insured located in the State of Georgia with the following account information:






	 	 	 	Bank:
	 
	 	 	 	ABA:
	 
	 	 	 	Account Number:
	 
	 	 	 	Account Name:
	 
	 	 	 	Type of Account:






	II.	 	“Insurer” has the meaning set forth in the preamble of this Policy.
	 
	JJ.	 	“Life Insurance Carrier” means, for each Covered Policy, the issuer of such Covered
Policy identified as such in the applicable Coverage Certificate.
	 
	KK.	 	“Limit of Liability” means, for each Covered Loan, the amount set forth as such in the applicable Coverage Certificate.
	 
	LL.	 	“Loan Rate” means, for each Covered Loan, the rate set forth as such in the applicable Coverage Certificate.





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[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.







	MM.	 	“Loss Notification Date” means, for any Covered Loan, the date on which the
Insured receives a notice of a loss under this Policy relating to such Covered Loan, which
date shall be:






	 	(1)	 	if there is one Covered Policy relating to such Covered Loan, the
earliest of (i) the date the Insured receives actual notice that such Covered
Policy has either lapsed or been sold (directly through a sale of such Covered
Policy or indirectly through a sale of the Beneficial Interest in a Trust),
surrendered to the Life Insurance Carrier or Contested, (ii) the [*]
([*]th) day after the Unencumbered Covered Policy Date and (iii) the [*]
([*]th) day after the Maturity Date in the event that a
Bankruptcy-Related Failure to Sell exists with respect to such Covered Policy; or
	 
	 	(2)	 	if there is more than one Covered Policy relating to such Covered Loan,
the earliest of (i) the date on which the Insured receives actual notice that the
last Covered Policy relating to such Covered Loan has either lapsed or been sold
(through a sale of such Covered Policy or related Beneficial Interest), surrendered
to the Life Insurance Carrier or Contested, (ii) the [*] ([*]th) day
after the Unencumbered Covered Policy Date of such last Covered Policy and (iii)
the [*] ([*]th) day after the Maturity Date in the event that a
Bankruptcy-Related Failure to Sell exists with respect to the related Covered
Policies.






	NN.	 	“LPIC Premium” means, for each Covered Loan, the amount set forth as such in the
applicable Coverage Certificate.
	 
	OO.	 	“LPIC Servicer” means the company appointed by the Insured to perform any duties
on behalf of the Insured under the Policy, and solely in such capacity, which company shall
(i) initially be Imperial Life & Annuity Services, LLC and (ii) be subject to replacement
by the Insured from time to time in its sole discretion upon delivery of a notice to the
Insurer identifying the replacement LPIC Servicer.
	 
	PP.	 	“Master Participation Agreement” means the Master Participation Agreement dated as of
the Effective Date between the Retail Lender and the Insured, in the form provided to the
Insurer on the Effective Date and as the same may be amended, supplemented or otherwise
modified from time to time in accordance with the terms thereof.
	 
	QQ.	 	“Maturity Date” means, for each Covered Loan, the date set forth as such in the
applicable Coverage Certificate.
	 
	RR.	 	“Outstanding Loan Balance” has the meaning
set forth in Section I.
	 
	SS.	 	“Payment Date” means, for each Covered Loan, the date on which the Insurer pays the
Insured the related Outstanding Loan Balance, if any.
	 
	TT.	 	“Person” means any individual, corporation, partnership, joint venture, association, joint-
stock company, limited liability company, trust, unincorporated association, joint
venture, government or any agency or political subdivision thereof or any other entity.
	 
	UU.	 	“Pledge and Security Agreement” means the Pledge and Security Agreement dated as
of the Effective Date made by the Insured in favor of LoIC LLC as collateral agent for the





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BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.







	 	 	lenders under the Wholesale Loan Agreement, in the form provided to the Insurer on
the Effective Date and as the same may be amended, supplemented or otherwise modified
from time to time in accordance with the terms thereof.






	VV.	 	“Policy” has the meaning set forth in the preamble hereof.
	 
	WW.	 	“Pre-Certificate Review Decision Notice” means notification from the Insurer to
the Insured pursuant to the Services and Remarketing Agreement stating that either (i) the
Insurer is committed, subject to the terms of this Policy, to deliver upon the request of
the Insured a certificate evidencing coverage for such under the Policy consistent with the
terms specified in such Pre-Certificate Review Decision Notice, or (ii) the Insurer is
declining to provide coverage under the Policy and the rationale for such decline.
	 
	XX.	 	“Prohibited Act” has the meaning set forth in Section VI.B.
	 
	YY.	 	“Proof of Loss” means a certificate in the form set forth in Exhibit B attached hereto,
properly completed and duly executed by the Insured, with all required exhibits thereto
(including an exhibit, in the form set forth in Exhibit 1 to the Proof of Loss
attached hereto, reflecting the Insured’s non-binding calculation of the Outstanding Loan
Balance and, if applicable, all notices received by the Insured or any agent, servant or
employee of the Insured in connection with the lapse of any Covered Policy and/or any
Contestability Determination Documents).
	 
	ZZ.	 	“Proof of Loss Due Date” has the meaning set forth in Section IV.C.
	 
	AAA.	 	“Remarketing Agent” means the company that will act as the exclusive remarketing
agent for purposes of selling or otherwise disposing of a Covered Policy, which company
shall (i) initially be Imperial Life & Annuity Services, LLC (ii) at all times be obligated
to take instructions from and act on behalf of the Insurer with regard to the sale or other
disposition of such Covered Policy and (iii) be subject to replacement by the Insurer from
time to time in its sole discretion; provided that, any such replacement shall only be
effective for purposes of this Policy upon delivery by the Insurer to the Insured
of a written notice identifying the replacement Remarketing Agent.
	 
	BBB.	 	“Responsible Party” means, any Person that provides direct or indirect financial
support to or for the benefit of the Insured in respect of any Covered Loan through the
Wholesale Loan Agreement and/or any Affiliate, Authorized Officer or employee of any such
Person; provided that, none of the Insured or its Authorized Officers or any Affiliate of
the Insured or any such Authorized Officers shall be considered a Responsible Party.
	 
	CCC.	 	“Retail Borrower” means, for each Covered Loan, the Person obligated to make
principal and interest payments to the applicable Retail Lender in connection with such
Covered Loan.
	 
	DDD.	 	“Retail Lender” means, for each Covered Loan, the company that makes such Covered
Loan to the Retail Borrower, which company shall be Imperial Premium Finance, LLC or any
other wholly-owned subsidiary of Imperial Holdings, LLC identified by the Insured to the
Insurer in writing at least ten (10) Business Days prior to such entity making its first
Covered Loan to a Retail Borrower; provided that, any such company shall have entered the
Master Participation Agreement and the appropriate Insurance Premium Loan Sale and
Assignment Agreement.





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[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.






	EEE. 	 	“Retail Loan Documents” means, for each Covered Loan, the relevant documents
entered into in connection with the issuance of such Covered Loan, including without
limitation the relevant loan application and agreement; promissory note; escrow agreement;
beneficiary pledge agreement; assignment of life insurance policy as collateral; guaranty;
trust disclosure statement, representations and warranties, and consent; authorization and
direction to provide death certificate; limited specific power of attorney; authorization
forms for use and disclosure of health information; brokers rights of agent; limited power
of attorney; hold harmless agreement; insured disclosure statement, representations and
warranties, and consent; representations, warranties and covenants of agent; single case
agreement; contact form, notifier letter, assignment of beneficial interest; fee agreement
and the form of trust or model trust provisions, in each case in the form provided to the
Insurer on the Effective Date.
	 
	FFF.	 	“Services and Remarketing Agreement” means the LPIC Services and Remarketing
Agreement, entered into as of the Effective Date by and among the Insurer, the Contingent
LPIC Insurer and Imperial Life & Annuity Services, LLC, as may be amended and restated, or
otherwise modified from time to time.
	 
	GGG.	 	“Settlement Amount” means, for each Covered Policy:






	 	(i)	 	if the Underlying Life has died prior to the earliest date on which such
Covered Policy either lapses, is surrendered to the Life Insurance Carrier or is
sold (directly through a sale of such Covered Policy or indirectly through a sale
of the related Beneficial Interest) and the Life Insurance Carrier has not
Contested such Covered Policy, an amount equal to the “Death Benefit” amount set
forth in the applicable Coverage Certificate (without reduction due to an Event of
Bankruptcy with respect to the Life Insurance Carrier or any other reason); or
	 
	 	(ii)	 	if such Covered Policy has been surrendered to the Life Insurance Carrier
with the permission of the Insurer, the amount payable by such Life Insurance
Carrier pursuant to the terms of such Covered Policy (without reduction due to an
Event of Bankruptcy with respect to the Life Insurance Carrier or any other
reason); or
	 
	 	(iii)	 	if such Covered Policy has been Contested, an amount equal to the sum of
(a) plus (b) all multiplied by (c), where:






	 	(a)	 	equals the amount payable by the relevant Life Insurance Carrier
to the owner of such Covered Policy as return of premium and interest, if
any, pursuant to the terms of a Contest under such Covered Policy and
applicable law (without reduction due to an Event of Bankruptcy with
respect to the Life Insurance Carrier);
	 
	 	(b)	 	without double counting amounts in clause (a) above, equals the
greater of (x) and (y) where (x) is all assets being held by or on behalf
of the Retail Borrower pursuant to escrow arrangements as required
pursuant to the terms of the Retail Loan Documents to fund premium
payments, solely with respect to such Covered Policy, but not yet used by
the Retail Borrower to fund premium payments and (y) is the “Total Life
Insurance Premium” set forth in the applicable Coverage Certificate minus
(a);





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OF THE SECURITIES ACT OF 1933, AS AMENDED.







	 	(c)	 	equals a fraction, the numerator of which is the “Covered Life
Insurance Premium” set forth in the applicable Coverage Certificate, and
the denominator of which is the “Total Life Insurance Premium” set forth
in the applicable Coverage Certificate; or






	 	(iv)	 	if a sale of such Covered Policy or related Beneficial Interest has been
consummated, the actual amount paid by the buyer to purchase such Covered Policy or
related Beneficial Interest; or
	 
	 	(v)	 	if (a) such Covered Policy has lapsed on or before the [*]
([*]th) day after the Maturity Date and such Policy was in force on the
date when the aggregate amount of premium received by the applicable Life Insurance
Carrier under such Covered Policy equaled the “Total Life Insurance Premium” set
forth in the applicable Coverage Certificate, (b) such Covered Policy is in effect
and has not been surrendered to the Life Insurance Carrier or sold (directly
through a sale of such Covered Policy or indirectly through a sale of the related
Beneficial Interest) by the [*] ([*]th) day after the applicable
Unencumbered Covered Policy Date, or (c) a Bankruptcy-Related Failure to Sell has
occurred, zero (0).






	HHH.	 	“Surplus Lines Broker” has the meaning set forth in Item 6 of the
Declarations. III. “Term” has the meaning set forth in Item 3 of the Declarations.
	 
	III.	 	“Term” has the meaning set forth in Item 3 of the Declarations.
	 
	JJJ.	 	“Total Life Insurance Premium” means, for any Covered Policy, the amount set
forth as such on the applicable Coverage Certificate.
	 
	KKK.	 	“Transaction Documents” means this Policy and any Coverage Certificates issued
under this Policy, as any of the foregoing may be amended, supplemented, amended and
restated, or otherwise modified from time to time.
	 
	LLL.	 	“Trust” means, for each Covered Loan, any trust that owns a Covered Policy.
	 
	MMM.	 	“Underlying Life” means, for each Covered Policy, the individual (or individuals)
specified as such (by unique identifying number or otherwise) in the applicable Coverage
Certificate and who is the measuring life (or are the measuring lives) under such Covered
Policy.
	 
	NNN.	 	“Unencumbered Covered Policy Date” has the meaning set forth in Section IV.D.
	 
	OOO.	 	“Wholesale Lender Party” means, LoIC LLC as lender and LoIC LLC as administrative
agent and collateral agent, in each case, under the Wholesale Loan Agreement.
	 
	PPP.	 	“Wholesale Loan Agreement” means Financing Agreement dated as of September 14,
2009 among the Insured, as borrower, LoIC LLC, as lender and LoIC LLC as administrative
agent and collateral agent.





Section IX. Recovery and Subrogation





	 	 	In the event of any payment made by the Insurer in connection with this Policy in respect of one
or more Covered Loans or any Covered Policy, in addition to all other rights, remedies and/or





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BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.




recoveries available to the Insurer (including those relating to any Covered Policy or
related Beneficial Interest), the Insurer shall be subrogated to all the Insured’s rights of
recovery against any Person solely in respect of any such payments, and the Insured shall
execute and deliver all instruments and papers reasonably requested by the Insurer and do
whatever else is commercially reasonable to secure any such rights, remedies and/or recoveries.
The Insured shall do nothing to prejudice such rights, remedies or recoveries.




Section X. Confidentiality





	A.	 	Each party hereto agrees that “Confidential Information” means (i) each of the
Transaction Documents and its contents, (ii) all medical and personal information
concerning any Underlying Life and, if applicable, any Retail Borrower and (iii) all
confidential or non-public information and data in whatever form, whether written, oral,
electronic or otherwise furnished by either party in connection with this Policy in each
case to the extent, (a) not already in the receiving party’s possession, (b) not available
to the receiving party prior to its disclosure under this Policy, (c) not in the public
domain when transmitted by one party to another, (d) not published or otherwise becoming
part of the public domain (through no fault of the receiving party) prior to or after
transmission, (e) not known to the receiving party through disclosure by a third party
(and not to the knowledge of the recipient of such information bound by any duty to the
transmitting party to keep such information confidential), and (f) not independently
developed by the receiving party.
	 
	B.	 	Each party hereto shall safeguard and hold, and cause their respective officers,
directors employees, agents or representatives to safeguard and hold, as confidential all
Confidential Information, and shall use Confidential Information solely for the purposes
contemplated by the Transaction Documents unless and only to the extent (i) disclosed to
such party’s (or any of its Affiliate’s) own officers, directors, employees, agents or
representatives (including attorneys and internal and outside auditors) that have a need
to know such information in connection with the underwriting or administration of any
coverage contemplated or provided under this Policy, (ii) disclosed to the Contingent LPIC
Insurer or any of its or its Affiliate’s own officers, directors, employees, agents or
representatives (including attorneys and internal and outside auditors) that have a need
to know such information in connection with the underwriting or administration of any
coverage contemplated or provided under the Contingent LPIC Policy, (iii) disclosed to
Wholesale Lender Parties or their respective officers, directors, employees, agents or
representatives (including attorneys and internal and outside auditors) that have a need
to know such information in connection with entering into, and administering loans made
pursuant to, the Wholesale Loan Agreement; provided that, they shall have been informed of
the confidential nature of the Confidential Information and directed to treat it
confidentially in accordance with the terms of this Section X, (iv) compelled to
disclose by judicial or administrative process or by other requirements of law or
regulation, (v) requested to disclose by any competent executive, legislative, judicial,
regulatory or administrative authorities with regulatory authority over the disclosing
party, or (vi) disclosed in any action or proceeding brought by a party in pursuit of its
rights or in the exercise of its remedies under this Policy. Notwithstanding the
foregoing, this Policy, the form hereof and any other document delivered by the Insurer in
connection with this Policy, shall constitute Confidential Information of the Insurer, and
the Insurer shall be entitled to use the form of this Policy in its business with no
restrictions imposed by the provisions of this Section X.





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[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.




	C.	 	Notwithstanding anything to the contrary set forth in this Policy, each of the
Insurer and the Insured (and each employee, representative, or other agent of such party)
may disclose to any and all Persons, without limitation of any kind, the Tax Treatment and
Tax Structure of this Policy. For purposes of these provisions, “Tax Treatment” is strictly
limited to the purported or claimed United States federal income tax treatment of this
Policy and “Tax Structure” is strictly limited to any fact that may be relevant to
understanding the purported or claimed United States federal income tax treatment of this
Policy. These provisions are meant to be interpreted so as to prevent this Policy from
being treated as offered under “conditions of confidentiality” within the meaning of the
Internal Revenue Code and the Treasury Regulations thereunder.





Section XI. General Policy Provisions





	A.	 	Assignment: This Policy and any and all rights under this Policy may not be
assigned by either party without the prior written consent of the other party;
provided, however, that (i) while the Insurer will continue to deal solely with
the Insured in connection with all matters pertaining to this Policy, the Insured may
pledge its rights under this Policy as contemplated by the Wholesale Loan Agreement and
the Pledge and Security Agreement and (ii) the Insurer may assign this Policy and any and
all rights under this Policy to another member company of Chartis without the prior
written consent of the Insured so long as such other member company, at the time of
transfer, has a financial strength rating from Standard & Poor’s Rating Services, a
division of the McGraw-Hill Companies, Inc. or Moody’s Investors Service, Inc. equal to or
better than that of the Insurer at the time of such assignment, and in the event of any
such assignment by the Insurer, the Insurer or the assignee shall, if practical, endeavor
to provide the Insured with prior or subsequent written notice of such assignment. The
Insurer shall not be bound by any assignment or transfer of interest that takes place
without its prior written consent.
	 
	B.	 	Changes and Waivers: Notice to any representative of the Insurer or knowledge
possessed by any such representative or by any Person shall not effect a waiver or change
in any part of this Policy; nor shall the terms of this Policy be waived, changed,
modified or amended unless agreed to in writing by an authorized representative of the
Insurer. The failure of either party to enforce any provision of this Policy shall not
constitute a waiver by such party of any such provision. Any past waiver of a provision by
any party shall not constitute a course of conduct or a waiver in the future of that same
provision.
	 
	C.	 	Examination of Books And Records: The Insurer shall have the right, but not the
obligation, from time to time to examine or audit, at the Insurer’s expense, all of the
Insured’s books and records that pertain to the coverage provided by this Policy. The
Insurer shall notify the Insured of such an inspection at least five (5) Business Days in
advance. To the extent that such books and records are to be maintained by a third party
on behalf of the Insured, the Insured shall ensure that any related agreement with such
third party allows for the Insurer to examine such books and records and the Insured shall
direct such third party to allow the Insurer to examine such books and records in
accordance with this section.
	 
	D.	 	Assistance and Cooperation: The Insured shall comply with all reasonable
requests of the Insurer to assist the Insurer in verifying the validity of a loss and
securing any rights,





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OF THE SECURITIES ACT OF 1933, AS AMENDED.






	 	 	remedies or recoveries arising out of a payment by the Insurer under this Policy
(including those relating to any Covered Policy or related Beneficial Interest),
including without limitation assisting the Insurer to obtain information regarding any
Covered Policy or the Underlying Life under any Covered Policy. In addition, the Insured
shall use commercially reasonable efforts to comply with all reasonable and lawful
requests that may be made by the Insurer in connection with keeping a Covered Policy in
force, including without limitation paying (or arranging for the payment of, or allowing
the Insurer if the Insurer so chooses to pay or arrange for the payment of) additional
premiums on such Covered Policy; it being understood that any such requests that may be
made by the Insurer, including without limitation, in connection with any payment of
additional premiums that may be required to keep a Covered Policy in force, shall only be
undertaken by or on behalf of the Insured at the expense of the Insurer.
	 
	 	 	The Insurer shall not be called upon to assume charge of the settlement or defense of any
claim made or suit brought or proceeding instituted against an Insured, but the Insurer
shall have the right and shall be given the opportunity to associate with the Insured or
the Insured’s underlying insurers or both in the defense and control of any claim, suit,
or proceeding that involves, or appears reasonably likely to involve, the Insurer or this
Policy, in which event the Insured and the Insurer shall cooperate in all things in the
defense of such claim, suit, or proceeding. The Insured shall furnish promptly all
information reasonably requested by the Insurer with respect thereto. If liabilities,
losses, costs and/or expenses are in part covered by this Policy and in part not covered
by this Policy, the Insured and Insurer shall use their best efforts to agree upon a fair
and proper allocation thereof between covered and uncovered amounts, and the Insured
shall cooperate with such efforts by providing all pertinent information with respect
thereto.
	 
	 	 	All information provided to the Insurer pursuant hereto is necessary to the consultation
and cooperation between the Insured and the Insurer for the management and resolution of
their respective affairs in connection with the Policy, and shall be provided
notwithstanding the issuance by the Insurer of any denial or reservation of rights. The
Insured and the Insurer agree that they may share a common interest in the matters
relating to this Policy and in information relevant thereto, including information
subject to attorney-client privilege, work product doctrine, litigation privilege, and
other legal or equitable privileges, and that the Insured’s provision of such information
is not intended to and shall not breach or impair any such privileges, regardless of the
forum in which such privileges may be asserted.
	 
	E.	 	Third Parties: This Policy shall not be deemed to give any right or remedy
whatsoever to any third party unless said right or remedy is specifically granted to such
third party by the terms hereof.
	 
	F.	 	Entire Agreement: This Policy contains the full and complete understanding and
agreement between the parties hereto with respect to the subject matter hereof. The
parties acknowledge that neither is entering into this Policy in reliance upon any term,
condition, representation or warranty not stated herein and that this Policy replaces any
and all prior agreements whether oral or written, pertaining to the subject matter hereof.
	 
	G.	 	Construction: It is understood and agreed that this Policy is a manuscript
policy that has been negotiated at arm’s length and on equal footing as between the
Insured and





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OF THE SECURITIES ACT OF 1933, AS AMENDED.






	 	 	Insurer, that both parties are sophisticated and that both parties fully understand
and agree to all the terms and conditions contained in this Policy. Accordingly, in any
dispute concerning the meaning of this Policy, or any term or condition hereof, such
dispute shall be resolved without any presumption or rule of construction in favor of
either party or any related or similar doctrine.
	 
	H.	 	Bankruptcy: An Event of Bankruptcy with respect to the Insured or any other
Person shall not relieve the Insurer of any of its obligations hereunder.
	 
	I.	 	Notices: Except as set forth in Section XI.M below, any communication
required to be given hereunder shall be effective only if in writing and shall be deemed
sufficiently given only if sent to the Insured or to the Insurer, as applicable, at the
address or facsimile number shown below, unless a change in address is received by the
notifying party.




If to the Insurer:



Lexington Insurance Company 70

Pine Street, 5th Floor

New York, New York 10270

Facsimile: (212) 943-4054

Attention: Surveillance Department



If to the Insured:



Imperial PFC Financing II, LLC

191 Peachtree Street NE, Suite 3300

Atlanta, Georgia 30303

Fax: (404) 736-3620

Attention: David Manchester





	 	 	With regard to any notices or other documents referenced in this Policy that are to be
delivered to the Insured by any Person other than the Insurer, such notices shall be
deemed to have been delivered to the Insured in the event that they were delivered to any
named agent, servant or employee of the Insured or any other Person appointed by the
Insured to perform any duties on behalf of the Insured in connection with this Policy.
	 
	J.	 	Governing Law: This Policy shall be interpreted and all disputes and
controversies arising under or related to this Policy shall be governed by and decided
under the internal laws of the State of New York (including without limitation Section
5-1401 of the General Obligations Law of the State of New York), without regard to
conflicts of laws principles that would require or allow for the application of any other
jurisdiction’s law.
	 
	K.	 	Offset: The Insured and the Insurer shall have the right at any time to offset
any balance or amounts due from one party to the other under the terms of this Policy
(including pursuant to a Proof of Loss delivered by the Insured to the Insurer under this
Policy); provided that no right of offset shall exist under this Section XI.K with
regard to any amount due from the Insured to the Insurer as a result of a breach of any
representation, warranty or covenant set forth in Section VII.
	 
	L.	 	Alternative Dispute Resolution:





25

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[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.






	 	(1)	 	It is hereby understood and agreed that all disputes or differences which may
arise under or in connection with this Policy, including without limitation any
determination of the amount of damages and including without limitation any disputes or
differences arising and/or continuing after the termination, cancellation or expiration of
this Policy, shall be submitted to binding arbitration. Any such arbitration shall be
based on the Procedures for the Resolution of U.S. Insurance and Reinsurance Disputes
dated September 1999 (the “Procedures”), as supplemented by the paragraphs below.
	 
	 	(2)	 	The Panel shall consist of three Disinterested arbitrators, one to be appointed by the
Petitioner, one to be appointed by the Respondent and the third to be appointed by the two
Party-appointed arbitrators. The third arbitrator shall serve as the umpire, who shall be
neutral. The arbitrators and umpire shall be persons who have knowledge of the legal,
financial, corporate and insurance issues relevant to the matters in dispute. Within thirty
days of the commencement of the arbitration proceeding, each Party shall provide the other
Party with the identification of its Party-appointed arbitrator, his or her address (including
telephone, fax and e-mail information), and provide a copy of the arbitrator’s curriculum
vitae. If either Party fails to appoint an arbitrator within that thirty-day period (or
applicable longer period), the non-defaulting Party will appoint an arbitrator to act as the
Party-appointed arbitrator for the defaulting Party. The umpire shall be appointed by the two
Party-appointed arbitrators as soon as practical (but no later than 30 days) after the
appointment of the second arbitrator. The Party-appointed arbitrators may consult, in
confidence, with the Party who appointed them concerning the appointment of the umpire.
	 
	 	(3)	 	Where the two Party-appointed arbitrators have failed to reach agreement on an umpire within
the time specified in paragraph (2) immediately above, each Party shall propose to the other
in writing, within 7 days thereafter, eight umpire candidates from the ARIAS U.S. Certified
Arbitrators List in effect at the time of the commencement of the arbitration. The umpire will
then be selected in accordance with 6.7(b)-(e) of the Procedures. (Unless the Parties agree
otherwise, the ARIAS U.S. Umpire Questionnaire Form in effect at the time of the commencement
of the arbitration shall be used).
	 
	 	(4)	 	The arbitration shall take place in New York, New York.
	 
	 	(5)	 	Unless prohibited by law, the Supreme Court of the State and County of New York and the
United States District Court for the Southern District of New York shall have exclusive
jurisdiction over any and all court proceedings that either Party may initiate in connection
with the arbitration, including proceedings to compel, stay, or enjoin arbitration or to
confirm, vacate, modify, or correct an Arbitration Award..
	 
	 	(6)	 	The arbitration award shall not include attorneys’ fees or other costs. Each party shall bear
the expense of its own arbitration activities, including its appointed arbitrator and its
outside attorney or witness fees, and the parties shall equally bear the expense of the umpire
and the common expenses of the arbitration proceeding.





26

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[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.







	 	(7)	 	For purposes of this Section XI.L., the terms “Arbitration
Award,” “Disinterested,” “Notice of Arbitration,” “Panel,” “Party” (or
“Parties”), “Petitioner,” “Respondent,” and “Response” shall have the meanings
set forth in article 2 of the Procedures (Definitions).
	 
	 	(8)	 	In the event of any conflict between the Procedures and this Article,
this Article, and not the Procedures, will control.
	 
	 	(9)	 	This Section XI.L. shall survive the expiration or termination of
this Policy.






	M.	 	Service of Suit: Subject to Section XI.L. above, in the event of
failure of the Insurer to pay any amount claimed to be due hereunder, the Insurer, at the
request of the Insured, will submit to the jurisdiction of a court of competent
jurisdiction within the United States. Nothing in this condition constitutes or should be
understood to constitute a waiver of the Insurer’s rights to commence an action in any
court of competent jurisdiction in the United States, to remove an action to a United
States District Court or to seek a transfer of a case to another court as permitted by the
laws of the United States or of any state in the United States. Service of process in such
suit may be made upon General Counsel, Lexington Insurance Company, 175 Water Street, New
York, New York 10038 or his or her representatives, with a copy to Risk Finance,
Attention: Senior Division Counsel, Chartis, 70 Pine Street, 5th Floor, New York, New York
10270. In any suit instituted against the Insurer upon this Policy, the Insurer shall
abide by the final decision of such court or of any appellate court in the event of any
appeal.
	 
	 	 	Further, pursuant to any statute of any state, territory, or district of the United
States which makes provision therefor, the Insurer hereby designates the Superintendent,
Commissioner, or Director of Insurance, other officer specified for that purpose in the
statute, or his or her successor or successors in office as its true and lawful attorney
upon whom may be served any lawful process in any action, suit, or proceeding instituted
by or on behalf of the Insured or any beneficiary hereunder arising out of this Policy,
and hereby designates the above named counsel as the individual to whom the said officer
is authorized to mail such process or a true copy thereof.
	 
	N.	 	Unwinding of Covered Policies: Notwithstanding any other provision in this
Policy, if, after the issuance of a Coverage Certificate, the applicable Retail Borrower
exercises its right to cancel a Covered Policy relating to the applicable Covered Loan
within the applicable Free Look Period, then (1) all coverage under this Policy relating
to such Coverage Certificate shall be void ab initio, (2) the Insurer shall return to the
Insured all previously received Premium relating to such Covered Loan and (3) each of the
Insurer and the Insured shall bear its own costs and expenses relating thereto, with no
rights to indemnification from the other party for such costs and expenses.
	 
	O.	 	Counterparts: This Policy may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute one and the
same document.
	 
	P.	 	Inadvertent Errors: If, after the issuance of a Coverage Certificate, the
Insurer or the Insured discovers that an inadvertent error has been made in such Coverage
Certificate, such party shall promptly notify the other party of such inadvertent error.
Following such notification, such inadvertent error may be corrected with the issuance of
a replacement





27

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[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.






	 	 	Coverage Certificate, but only under one of the following circumstances: (i) such inadvertent
error was an inadvertent omission, incorrect reference, typographical error or unintended
inconsistency in any Application for Lender Protection Insurance Coverage or any Coverage
Certificate and the issuance of the revised Coverage Certificate would not adversely affect the
rights of the Insurer, the Insured or any Wholesale Lender Party; (ii)(x) concurrently with the
issuance of such revised Coverage Certificate, any Covered Loan and any related loan made by a
Wholesale Lender Party under the Wholesale Loan Agreement is repaid to the extent necessary to
restore the Insurer, the Insured and any Wholesale Lender Party to the same position that each such
Person would have occupied had such inadvertent error not occurred and (y) the issuance of the
revised Coverage Certificate would not adversely affect the rights of the Insurer, the Insured or
any Wholesale Lender Party; or (iii) any other circumstance in which the issuance of such revised
Coverage Certificate would not adversely affect the rights of the Insurer, the Insured or any
Wholesale Lender Party.





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[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.




By signing below, the President and Secretary of the Insurer agree on behalf of the Insurer
to all of the terms of this Policy.




	 	 	 	 	 	 
						 
	 	 	 	 	 	 
	 	 	 	 	 	
	 
	 	 	 	 	
	President
	 	 
	 	Secretary	 
	Lexington Insurance Company
	 	 	 	Lexington Insurance Company	





This Policy shall not be valid unless signed at the time of issuance by an authorized
representative of the Insurer on the Declarations page.



IN WITNESS WHEREOF, each of the Insured and the Surplus Lines Broker has caused this Policy to be
signed by its duly authorized representative:




	 	 	 	 	 
	IMPERIAL PFC FINANCING II, LLC

 	 	 
	By:  	 	 	 
	 	Name:  	 	 	 
	 	Title:  	 	 	 
	 
	 
	WILLIAM LEE MERSHON



Georgia Surplus Lines License No.: 665715



Firm Name: Hays Companies

 	 	 
	By:  	 	 	 
	 	William Lee Mershon 	 	 
	 	 	 	 
	 



29

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[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.





By signing below, the President and Secretary of the Insurer agree on behalf of the Insurer to
all of the terms of this Policy.




	 	 	 	 	 	 
						
	 	 	 	 	 	
	 	 	 	 	 	
	 
	 	 	 	 	
	President
	 	 
	 	Secretary	
	Lexington Insurance Company
	 	 	 	Lexington Insurance Company	





This Policy shall not be valid unless signed at the time of issuance by an authorized
representative of the Insurer on the Declarations page.



IN WITNESS WHEREOF, each of the Insured and the Surplus Lines Broker has caused this Policy to be
signed by its duly authorized representative:




	 	 	 	 	 
	IMPERIAL PFC FINANCING II, LLC




 	 	 
	By:  	 	 	 
	 	Name:  	 	 	 
	 	Title:  	 	 	 
	 
	 
	WILLIAM LEE MERSHON



Georgia Surplus Lines License No.: 665715



Firm Name: Hays Companies

 	 	 
	By:  	 	 	 
	 	William Lee Mershon 	 	 
	 	 	 	 
	 



30

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[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.



EXHIBIT A 




FORM OF COVERAGE CERTIFICATE



LEXINGTON INSURANCE COMPANY

100 Summer Street



Boston, Massachusetts 02110



THIS CONTRACT IS REGISTERED AND DELIVERED AS A SURPLUS LINE COVERAGE UNDER THE SURPLUS LINE

INSURANCE LAW O.C.G.A. CHAPTER 33-5.




COVERAGE CERTIFICATE FOR LENDER PROTECTION INSURANCE COVERAGE

POLICY NUMBER: 7113491




	 	 	 	 	 

	Certificate Number:
	 	 	 	 
	 
	 	 	 
	LPIC Premium:
	 	$	 	 
	 
	 	 	 
	Contingent LPIC Premium:
	 	$	 	 
	 
	 	 	 
	Total Loan:
	 	$	 	 
	 
	 	 	 





Information Relating to Covered Loan




	 	 	 	 	 

	Covered Loan Number:
	 	 	 	 
	 
	 	 	 
	Covered Loan Amount:
	 	$	 	 
	 
	 	 	 
	Loan Rate:
	 	%	 	 
	 
	 	 	 
	Covered Expenses:
	 	$	 	 
	 
	 	 	 
	State of Domicile of Retail Borrower:
	 	 	 	 
	 
	 	 	 
	Coverage Certificate Effective Date:
	 	 	 	 
	 
	 	 	 
	Maturity Date:
	 	 	 	 
	 
	 	 	 
	Limit of Liability:
	 	[ $   ] plus
interest at the Loan Rate calculated

from the Maturity Date to the Payment Date






A-1


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[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.





Information Relating to Covered Policies




Covered Policy #1



	 	 	 	 	 

	Covered Policy ID:
	 	 	 	 
	 
	 	 	 
	Covered Policy Number:
	 	 	 	 
	 
	 	 	 
	 Life Insurance Carrier:
	 	 	 	 
	 
	 	 	 
	State in Which Covered Policy was Issued by the Life Insurance Carrier:
	 	 	 	 
	 
	 	 	 
	Total Life Insurance Premium:
	 	$	 	 
	 
	 	 	 
	Covered Life Insurance Premium:
	 	$	 	 
	 
	 	 	 
	Death Benefit:
	 	$	 	 
	 
	 	 	 





Covered Policy #2 (if applicable)




	 	 	 	 	 

	Covered Policy ID:
	 	 	 	 
	 
	 	 	 
	Covered Policy Number:
	 	 	 	 
	 
	 	 	 
	Life Insurance Carrier:
	 	 	 	 
	 
	 	 	 
	State in Which Covered Policy was
Issued by the Life Insurance
Carrier:
	 	 	 	 
	 
	 	 	 
	Total Life Insurance Premium:
	 	$	 	 
	 
	 	 	 
	Covered Life Insurance Premium:
	 	$	 	 
	 
	 	 	 
	Death Benefit:
	 	$	 	 
	 
	 	 	 





	 	 	 	 	 
	 	LEXINGTON INSURANCE COMPANY

 	 
	 	By:  	 	 
	 	 	Title: Authorized Representative 	 
	 	 	Signed on: 	 
	 



A-2




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[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.





EXHIBIT B




FORM OF PROOF OF LOSS



IMPERIAL PFC FINANCING II, LLC

191 Peachtree Street NE

Suite 3300

Atlanta, Georgia 30303



[INSERT DATE]





	To: 	 	 Lexington Insurance Company

70 Pine Street, 5th Floor

New York, New York 10270

Facsimile: (212) 943-4054

Attention: Surveillance Manager
	 
	Re: 	 	 Proof of Loss for Lender Protection Insurance Coverage





     Reference is hereby made to (i) the Lender Protection Insurance Policy, Policy Number
7113491 with an effective date of September 14, 2009, issued by Lexington Insurance Company
(the “Insurer”); (ii) the Coverage Certificate, Certificate Number [•], dated
as of [DATE], issued by the Insurer; and (iii) each life insurance policy (each such policy, a
“Covered Policy”) with respect to such Coverage Certificate issued by [INSERT LIFE
INSURANCE CARRIER’S NAME] (each, a “Life Insurance Carrier”). For purposes of this
Proof of Loss, the Lender Protection Insurance Policy shall be known as the “Policy”.
Capitalized terms used in this Proof of Loss without definition shall have the meanings
specified in the Policy.



     This Proof of Loss is hereby submitted to the Insurer by the Insured pursuant to
Section I and Section IV of the Policy. The following actions have taken place
with regard to each Covered Policy:



First Covered Policy




	 	 	 

	Policy Number:
	 	 
	 

	 	 
	Result:

	 	[Death of Underlying Life prior to the earliest date on which
such Covered Policy either lapses, is surrendered to
the relevant Life Insurance Carrier or is sold]
	 
	 	 
	 

	 	[Lapsed]
	 
	 	 
	 

	 	[Contested/Rescinded]
	 
	 	 
	 

	 	[Sold]
	 
	 	 
	 

	 	[Remains Unsold]
	 
	 	 
	 

	 	[Surrendered to the relevant Life Insurance Carrier]
	Settlement Amount:
	 	 
	 

	 	 
	 

	 	 
	 

	 	 





B-1 

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[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.






	 	 	 

	 
	 	 
	 

	 	 
	Date of Insured’s Receipt of Settlement Amount:
	 	 
	 

	 	 





Second Covered Policy (if applicable)




	 	 	 

	Policy Number:
	 	 
	 

	 	 
	Result:

	 	[Death of Underlying Life prior to the earliest date on which
such Covered Policy either lapses, is surrendered to
the relevant Life Insurance Carrier or is sold]
	 
	 	 
	 

	 	[Lapsed]
	 
	 	 
	 

	 	[Contested/Rescinded]
	 
	 	 
	 

	 	[Sold]
	 
	 	 
	 

	 	[Remains Unsold]
	 
	 	 
	 

	 	[Surrendered to the relevant Life Insurance Carrier]
	 
	 	 
	Settlement Amount:
	 	 
	 

	 	 
	 
	 	 
	Date of Insured’s Receipt
of Settlement Amount:
	 	 
	 

	 	 





     Given that the Outstanding Loan Balance is greater than zero (0) as of the date of this
Proof of Loss, a loss exists under the Policy.



     Given this loss, the following Outstanding Loan Balance is hereby demanded from the
Insurer: $[AMOUNT]. Attached hereto as Exhibit 1 is a summary of the calculation
performed to arrive at the Outstanding Loan Balance set forth in the preceding sentence, which
summary follows the formula set forth in the definition of Outstanding Loan Balance in the
Policy. It is acknowledged that the Outstanding Loan Balance specified in this Proof of Loss and
Exhibit 1 hereto represents the Insured’s calculation of the applicable Outstanding
Loan Balance due, and is not binding upon the Insurer.



     The Insurer should pay the amounts due to the Insured by electronic funds transfer to the
Insured’s Account.



     In the event that the Insurer notifies the Insured in writing that the Insurer is requiring
transfer of ownership of such Covered Policy or the related Beneficial Interest to the Insurer
or a third party designated by the Insurer:



     If the Insured is transferring ownership of the related Covered Policy, then on or before
the Payment Date, the Insured shall provide evidence that (i) the Insured has filed, or if the
Insured is not authorized to so file, has caused the relevant party so authorized to file, in
accordance with the terms of such Covered Policy, a change of ownership form with the Life
Insurance Carrier that issued such Covered Policy requesting the ownership of such Covered



B-2

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[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.






Policy be changed to the Insurer or such third party, (ii) the secured party(ies) under
each security agreement, collateral assignment and/or other instrument, agreement or document
granting a lien or other encumbrance on such Covered Policy or the proceeds thereof shall have
assigned to the Insurer or its designee, on commercially reasonable terms acceptable to the
Insurer, all of its rights as a secured party with respect to such Covered Policy under such
security agreement, collateral assignment and/or other instrument, agreement or document, (iii)
the Insured has taken all commercially reasonable and lawful actions to cause the relevant Life
Insurance Carrier to issue a verification of coverage indicating that ownership of such Covered
Policy has been changed to the Insurer or such third party designee, along with the original
Covered Policy and all amendments and endorsements thereto and any other documentation related
to such Covered Policy (but no verification of coverage need have been issued at that time) and
(iv) solely if received by the Insured on or prior to the Payment Date, a verification of
coverage issued by the Life Insurance Carrier indicating that ownership of such Covered Policy
has been changed to the Insurer or such third party designee. The Insured hereby (a) represents,
warrants and covenants to the Insurer, as of the date hereof and as of the date of transfer of
such Covered Policy to the Insurer or its designee that the Insured has taken all commercially
reasonable and lawful actions to cause the relevant Life Insurance Carrier to issue a
verification of coverage; and (b) covenants to the Insurer as of the date of transfer of such
Covered Policy to the Insurer or its designee that (1) the Insurer has full ownership of such
Covered Policy, (2) the Insured is transferring such Covered Policy to the Insurer free and
clear of any lien or encumbrance and (3) the Insured shall take commercially reasonable and
lawful actions that may be requested by the Insurer to allow such Covered Policy to be sold or
otherwise disposed of by the Insurer or its designee free and clear of any lien or encumbrance.
In the event that the Insured is found to be in breach of any of these representations,
warranties or covenants, the Insured shall repay to the Insurer the Outstanding Loan Balance
paid to the Insured pursuant to this Proof of Loss. If the Insured is transferring ownership of
the related Beneficial Interest, then on or before the Payment Date, the Insured shall provide
(i) an agreement among all of the beneficiaries of the related Trust, each Trustee and each
co-Trustee thereof evidencing that ownership of the related Beneficial Interest has been changed
to the Insurer or a third party designated by the Insurer and that each Trustee and each
co-Trustee of the related Trust has agreed not to take action with regard to such Trust or such
Covered Policy without the prior consent of the Insurer or such third party designee, (ii)
evidence that the secured party(ies) under each security agreement, collateral assignment and/or
other instrument, agreement or document granting a lien or other encumbrance on such Beneficial
Interest or the related Covered Policy or the proceeds thereof have assigned to the Insurer or
its designee, on commercially reasonable terms acceptable to the Insurer, all of its rights as a
secured party with respect to such Beneficial Interest and such related Covered Policy and the
proceeds thereof under such security agreement, collateral assignment and/or other instrument,
agreement or document, (iii) the Insured has taken all commercially reasonable and lawful
actions to cause the relevant Life Insurance Carrier to issue a verification of coverage
indicating that ownership of such Covered Policy resides with the Trust (but no verification of
coverage need have been issued at that time), (iv) solely if received by the Insured on or prior
to the Payment Date, a verification of coverage issued by the Life Insurance Carrier indicating
that ownership of such Covered Policy resides with the Trust, (v) the related Trust certificate,
if any, and (vi) copies of each Trustee’s and each co-Trustee’s books and records that reflect
that the Insurer or its third party designee is the sole beneficiary of the Trust. The Insured
hereby represents, warrants and covenants to the Insurer as of the date of transfer of such
Beneficial Interest to the Insurer or its designee (a) the Insurer has full ownership of such
Beneficial Interest, (b) such Beneficial Interest and the related Covered Policy are free and
clear of any lien or encumbrance, (c) nothing shall prohibit the Insurer, such third party
designee




B-3

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[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.




or any other Person to whom the Beneficial Interest is transferred, from having the related
Covered Policy removed from the related Trust and transferred to the Insurer, such third party
designee or such other Person and (d) the Insured shall take commercially reasonable and lawful
actions that may be requested by the Insurer to allow such Beneficial Interest or related
Covered Policy to be sold or otherwise disposed of by the Insurer or its designee free and clear
of any lien or encumbrance. In the event that the Insured is found to be in breach of any of
these covenants, the Insured shall repay to the Insurer the Outstanding Loan Balance paid to the
Insured pursuant to this Proof of Loss.




     The Insured certifies that the information contained in this Proof of Loss is complete,
true, correct and not misleading.



	 	 	 	 	 
	 	IMPERIAL PFC FINANCING II, LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



B-4

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[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.



Form of Exhibit 1 to Form of Exhibit B Proof of Loss




Calculation of Outstanding Loan Balance



	 	 	 	 	 

	(1)  Covered Loan Amount

(as adjusted downward, on a dollar for dollar basis, if the amount of
covered life insurance premium actually borrowed under such Covered Loan as
of such calculation date is less than the Covered Life Insurance
Premium):
	 	 	 	 
	 
	 	 	 
	(2)  Coverage Certificate Effective Date:
	 	 	 	 
	 
	 	 	 
	(3)  Maturity Date:
	 	 	 	 
	 
	 	 	 
	(4)  Insured’s estimate of Payment Date:
	 	 	 	 
	 
	 	 	 
	(5)  Loan Rate:
	 	 	 	 
	 
	 	 	 
	(6)  Aggregate Interest Amount (calculated separately for
each advance)
accrued from and including the date on which each such advance is made
through the Payment Date (adjusted, if necessary, in accordance with Section
IV.C):
	 	 	 	 
	 
	 	 	 
	(7)  Sum of all Settlement Amounts:
	 	 	 	 
	 
	 	 	 
	(8)  Sum of all other amounts paid to the Retail Lender to decrease the
outstanding balance of the related Covered Loan Amount and which the
Retail Lender has not been required to return or repay under any
applicable law (including bankruptcy or insolvency laws), but excluding
amounts paid to the Retail Lender to decrease the outstanding loan balance
of such Covered Loan in an aggregate amount up to but not exceeding the
portion of such Covered Loan secured by Additional Collateral:
	 	 	 	 
	 
	 	 	 
	(9)  Outstanding Loan Balance, which equals (1) above plus (6) above minus (7) above
minus (8) above:
	 	 	 	 
	 
	 	 	 





Ex. 1-1

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[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.



EXHIBIT C




FORM OF APPLICATION FOR LENDER PROTECTION INSURANCE COVERAGE



IMPERIAL PFC FINANCING II, LLC

191 Peachtree Street NE

Suite 3300

Atlanta, Georgia 30303


[INSERT DATE]





	To: 	 	 Lexington Insurance Company

70 Pine Street, 5th Floor

New York, New York 10270

Facsimile: (212) 943-4054

Attention: Surveillance Manager





	 
	Re: 	 	 Application For Lender Protection Insurance Coverage
	 
	1.	 	This Application For Lender Protection Insurance Coverage, pursuant to the Lender
Protection Insurance Policy, Policy Number 7113491 (the “Policy”), with an
effective date of September 14, 2009, is hereby submitted to Lexington Insurance Company.
Capitalized terms used in this Application For Lender Protection Insurance Coverage and
not otherwise defined herein shall have the meaning set forth in the Policy.
	 
	2.	 	The following information is hereby provided in connection with this
application:





General Information




	 	 	 

	Number of Covered Policies
on Covered Loan:
	 	 
	 

	 	 
	Covered Loan Number:
	 	 
	 

	 	 
	Covered Loan Amount:
	 	 
	 

	 	 
	Covered Expenses: 
	 	 
	 

	 	 
	Total Loan Amount: 
	 	 
	 

	 	 
	 Loan Rate:
	 	 
	 

	 	 
	Proposed Coverage Certificate
Effective Date:
	 	 
	 

	 	 
	Proposed Maturity Date:
	 	 
	 

	 	 





C-1









 





[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.





	 	 	 

	 

	 	 
	Retail Borrower’s State of
Domicile As of the Effective Date of
the Retail Loan or the
Proposed Retail Loan:
	 	 
	 

	 	 





First Covered Policy




	 	 	 

	Covered Policy ID:
	 	 
	 

	 	 
	Life Insurance Carrier:
	 	 
	 

	 	 
	Covered Policy Number:
	 	 
	 

	 	 
	State of Residence of
Underlying Life (as indicated in the
proposed Covered Policy or, if not yet
issued, in the related life insurance
policy application):
	 	 
	 

	 	 
	State of Residence or Domicile of Life
Insurance Policy Owner (as indicated
in the proposed Covered Policy or, if
not yet issued, in the related life
insurance policy application):
	 	 
	 

	 	 
	Proposed Total Life Insurance
Premium:
	 	 
	 

	 	 
	Proposed Covered Life
Insurance Premium:
	 	 
	 

	 	 
	Death Benefit:
	 	 
	 

	 	 





Second Covered Policy (if applicable)




	 	 	 

	Covered Policy ID
	 	 
	 

	 	 
	Life Insurance Carrier:
	 	 
	 

	 	 
	Covered Policy Number:
	 	 
	 

	 	 
	State of Residence of
Underlying Life (as indicated in the
proposed Covered Policy or, if not yet
issued, in the related life insurance
policy application):
	 	 






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© Chartis Inc. All rights reserved.













 





[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.




	 	 	 

	 

	 	 
	State of
Residence or Domicile
of Life Insurance
Policy Owner (as
indicated in the
proposed Covered
Policy or, if not yet
issued, in the related
life
insurance policy application):
	 	 
	 

	 	 
	Proposed Total Life
Insurance Premium:
	 	 
	 

	 	 
	Proposed Covered
Life Insurance 

Premium:
	 	 
	 

	 	 
	Death Benefit:
	 	 
	 

	 	 






	3.	 	Imperial PFC Financing II, LLC hereby represents and warrants to the Insurer, both as
of the date of this Application For Lender Protection Insurance and as of the date (if
any) on which the Insurer issues the corresponding Coverage Certificate, that it has a
place of business located within the State of Georgia.






	4.	 	Imperial PFC Financing II, LLC hereby represents and warrants to the Insurer, both as
of the date of this Application For Lender Protection Insurance and as of the date (if
any) on which the Insurer issues the corresponding Coverage Certificate, that to the
actual knowledge of the Insured or any of its Authorized Officers (i) no proposed Covered
Policy that is listed above has been Contested, (ii) the Life Insurance Carrier(s) that
issued or will issue each proposed Covered Policy listed above has not made any written
allegation or objection that could reasonably be expected to result in a Contest or that
could reasonably be expected to lead to questions regarding the validity of any such life
insurance policy (including without limitation questions regarding insurable interest) and
(iii) no proposed Covered Policy listed above, related Covered Loan or related premium
finance loan is the subject of a Prohibited Act.






	5.	 	Imperial PFC Financing II, LLC certifies that the information contained in this
Application For Lender Protection Insurance Coverage is complete, true, correct and not
misleading.




Upon your acceptance of the Covered Loan described above for coverage under the Policy,
please issue a corresponding Coverage Certificate.




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© Chartis Inc. All rights reserved.













 





[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.



	 	 	 	 	 
	 	IMPERIAL PFC FINANCING II, LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



C-4

© Chartis Inc. All rights reserved.













 




[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.




EXHIBIT B




COPY OF CONTINGENT POLICY



(see attached)




 











 





[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.



NATIONAL FIRE & MARINE INSURANCE COMPANY

3024 Harney Street

Omaha, Nebraska 68131




THIS CONTRACT IS REGISTERED AND DELIVERED AS A SURPLUS LINE

COVERAGE UNDER THE SURPLUS LINE INSURANCE LAW O.C.G.A. CHAPTER

33-5.



CONTINGENT LENDER PROTECTION INSURANCE POLICY

POLICY NUMBER: 92SRD102526



DECLARATIONS



	 	 	 

	Item 1. Insured’s Name:

	 	Imperial PFC Financing 11, LLC
	Insured’s address:

	 	191 Peachtree Street NE Suite 3300

Atlanta, Georgia 30303

Attention: David Manchester
	 
	 	 
	Item 2. Effective Date:

	 	September 14, 2009
	 
	 	 
	Item 3. Term:

	 	Continuous from the Effective Date until the earlier of: (I) the
date of the second (2nd) anniversary of the Effective Date or (ii) the date this Policy is
terminated. (See “Section IV — Termination” for more detail regarding termination.)
	 
	 	 
	Item 4. Limit of Liability:

	 	The Limit of Liability shall be the amount set forth as such in
the applicable Coverage Certificate.
	 
	 	 
	Item 5. Contingent LPIC
	 	 
	Premium:

	 	For each Covered Loan, the Contingent LPIC Premium shall
be the amount set forth as such in the applicable Coverage Certificate.






     All Contingent LPIC Premium is exclusive of any premium tax, any intermediary commission and
any other applicable taxes, fees or surcharges, all of which (if applicable) shall be the sole
responsibility of the Insured or its Surplus Lines Broker.



	 	 	 

	Item 6. Surplus Lines Broker:

	 	William Lee Mershon
	Mailing Address:

	 	Hays Companies

80 S. 8th Street, Suite 700 Minneapolis, MN 55402
	 
	 	 
	License No.:

	 	Georgia License No. 665715






 









 





[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.




	 	 	 	 	 
	 	NATIONAL FIRE & MARINE INSURANCE COMPANY

 	 
	 	By:  	 	 
	 	 	Authorized Representative 	 
	 	 	Signed on September 14, 2009 	 



 









 





[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.




	 	 	 	 	 



NATIONAL FIRE & MARINE INSURANCE COMPANY

3024 Harney Street

Omaha, Nebraska 68131




THIS CONTRACT IS REGISTERED AND DELIVERED AS A SURPLUS LINE

COVERAGE UNDER THE SURPLUS LINE INSURANCE LAW O.C.G.A. CHAPTER

33-5.



CONTINGENT LENDER PROTECTION INSURANCE POLICY

POLICY NUMBER: 92SRD102526


In consideration of the Insurer’s receipt of the Contingent LPIC Premium, in reliance on the
representations, warranties, acknowledgements and covenants of the Insured contained herein, and in
accordance with and subject to the terms, conditions, limitations and exclusions contained or
incorporated by reference herein, including the Declarations and any exhibits, schedules,
endorsements or other documents attached hereto or incorporated herein by reference, which together
shall constitute this Contingent Lender Protection Insurance Policy (this “Policy”), National Fire
& Marine Insurance Company (the “Insurer”) and Imperial PFC Financing 11, LLC (the “Insured”) agree
as follows:




Section I. Insuring Agreement



Upon and as of the occurrence of a Credit Event:





	A.	 	the Insurer hereby agrees to be liable to the Insured under this Policy for all then
outstanding and future obligations of the Original LPIC Insurer under the Original LPIC Policy
as if such obligations were set forth in this Policy;
	 
	B.	 	the Insurer shall be deemed to have all rights of the Original LPIC Insurer under the Original
LPIC Policy;
	 
	C.	 	the Insured may submit any Proof of Loss relating to any then outstanding Coverage
Certificate directly to the Insurer hereunder and the Insurer shall proceed to evaluate any
such claim as the “Insurer” with respect thereto; provided that, under no circumstances shall the
Insurer be required to pay any related claim with less than three (3) Business Days notice;
provided further, that if the Insured or LPIC Servicer submits a Proof of Loss to the Insurer, then
subject to the terms and conditions of this Policy the Insurer shall, within thirty (30) days after
its receipt of such related Proof of Loss, pay to the Insured, via electronic funds transfer to the
Insured’s Account the applicable Outstanding Loan Balance as of the related Payment Date, and
	 
	D.	 	the Insurer hereby agrees that it shall (i) be deemed to have issued all Coverage Certificates
previously issued by the Original LPIC Insurer under the Original LPIC Policy that were outstanding
as of the moment prior to the occurrence of the Credit Event and for which it has received the
related Contingent LPIC Premium and (ii) honor any and all notices and legal actions previously
undertaken by the Original LPIC Insurer under or in connection with the Original LPIC Policy and/or
the LPIC Services and




 









 






[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.










	 	 	Remarketing Agreement dated as of the Effective Date, as the same may be amended, supplemented
or otherwise modified in accordance with its terms.





Section II. Contingent LPIC Premium





	A.	 	With respect to each Covered Loan, the Insurer’s receipt of the Contingent LPIC Premium on or
before the Coverage Certificate Effective Date is a condition precedent to any coverage being
provided by this Policy for such Covered Loan; provided, however, that the Insurer’s receipt of
such Contingent LPIC Premium no later than three (3) Business Days following the related Coverage
Certificate Effective Date shall be deemed to satisfy such condition precedent with regard to the
related Covered Loan.
	 
	B.	 	All Contingent LPIC Premium shall be paid to the Insurer by wire transfer in immediately
available funds, free and clear of any setoff, counterclaim or other deduction.
	 
	C.	 	All Contingent LPIC Premium is exclusive of any premium tax, any intermediary commission and any
other applicable taxes, fees or surcharges, all of which (if applicable) shall be the sole
responsibility of the Insured or its Surplus Lines Broker.
	 
	D.	 	All Contingent LPIC Premium shall be fully earned upon receipt by the Insurer, and the Insured
shall not be entitled to a return of any Contingent LPIC Premium other than as required by Section
VIII.J.





Section III. Conditions Precedent to Coverage; Confirmation





	A.	 	Coverage under this Policy is subject to receipt by the Insurer of a fully executed copy of the
Original LPIC Policy as in effect on the Effective Date.
	 
	B.	 	With respect to each Coverage Certificate, coverage under this Policy is strictly subject to
satisfaction of the conditions precedent that: (i) the Original LPIC Insurer has issued the
applicable Coverage Certificate, (ii) the Insurer has received the applicable Contingent LPIC
Premium and (iii) the Original LPIC Insurer has received the applicable LPIC Premium in accordance
with the Original LPIC Policy.
	 
	C.	 	As and when Coverage Certificates are issued by the Original LPIC Insurer under the Original
LPIC Policy, the Insured shall submit a bordereau (each a “Periodic Bordereau”) to the Insurer
listing, among other things, by Certificate Number, the Coverage Certificates issued by the
Original LPIC Insurer during the period since the last such Periodic Bordereau was so submitted,
together with the Contingent LPIC Premium paid to the Insurer with respect thereto. The Insurer
shall review each Periodic Bordereau and shall countersign the same and return a copy thereof to
the Insured on a monthly batch basis to confirm receipt of the applicable Contingent LPIC Premium
and to confirm coverage for such Coverage Certificates under this Policy; provided that, any
failure of the Insurer to so countersign and return any such Periodic Bordereau shall not create
coverage under this Policy in respect of any Coverage Certificate that would not otherwise exist or
reduce or negate any such coverage.




 









 




[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.









Section IV. Termination



This Policy shall be continuous from the Effective Date until the earlier of: (i) the date of the
second (2nd) anniversary of the Effective Date or (ii) the date this Policy is terminated pursuant
to this Section IV. The Insurer shall have the right to terminate this Policy any time after
November 1, 2009, upon 30 days written notice to the Insured. Termination of this Policy shall
not affect (x) coverage in respect of any Coverage Certificate issued to the Insured by the
Original LPIC Insurer prior to the effective date of such termination or (y) the confidentiality
provisions set forth in Section VII.G. of the Original LPIC Policy and incorporated herein by
reference, which shall survive the termination of this Policy.




Section V. Representations, Warranties, Covenants and Acknowledgements





	A.	 	The Insurer represents and warrants to the Insured as follows:






	 	(1)	 	The Insurer is an insurance company duly organized and validly existing under the laws of
the State of Nebraska.
	 
	 	(2)	 	The Insurer has all requisite power and authority to enter into this Policy, and to
perform its obligations under this Policy.
	 
	 	(3)	 	The execution and delivery by the Insurer of this Policy, and the performance by the
Insurer of its obligations under this Policy, have been duly authorized as necessary and are valid
and binding obligations of the Insurer enforceable against it in accordance with its terms, subject
to (a) limitations imposed by any applicable bankruptcy, insolvency, reorganization, fraudulent
transfer, reorganization, moratorium and other similar laws affecting creditors’ rights generally
and (b) the effect of general principles of equity (regardless of whether considered in a
proceeding in equity or at law).






	B.	 	The Insured hereby makes each of the representations, warranties, covenants and
acknowledgments set forth in Section VII of the Original LPIC Policy in favor of the Insurer
hereunder as of the Effective Date as if such representations, warranties, covenants and
acknowledgements were set forth in this Policy.
	 
	C.	 	The Surplus Lines Broker represents, warrants and covenants to the Insurer that it has
complied, and will continue to comply, with all requirements of any applicable insurance code
in connection with the procurement of this Policy, including without limitation any applicable
requirement relating to the collection and/or payment of taxes, fees or surcharges.




Any breach of the representations, warranties or covenants made or deemed made in this Section V.
shall not expand the conditions to payment set forth in Section IV. of the Original LPIC Policy and
incorporated by reference herein or the exclusions to payment set forth in Section V. of the
Original LPIC Policy and incorporated by reference herein. Notwithstanding the foregoing, each of
the Insured and the Surplus Lines Broker acknowledges that the Insurer is entering into this Policy
in reliance upon the genuineness of the representations, warranties and covenants made or deemed
made in Section V.B. and Section V.C., and the Insurer shall retain






 









 





[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.




all remedies available at law or in equity in connection with any such breach; provided that no
right of offset shall exist with regard to any amount due from the Insured to the Insurer as a
result of a breach of any representation, warranty or covenant set forth in this Section V or
Section VII of the Original LPIC Policy.




Section VI. Definitions



Capitalized terms used and not otherwise defined in this Policy shall have the meaning given to
such terms in the Original LPIC Policy. The terms listed below shall have the following meaning and
any such term that is also defined in the Original LPIC Policy shall have the meaning set forth
below in lieu of the meaning set forth in the Original LPIC Policy:





	A.	 	“Contingent LPIC Premium” means, for each Covered Loan, [*]% of the related Limit of
Liability, which amount is set forth in U.S. dollars in the applicable Coverage Certificate.
	 
	B.	 	“Credit Event” means, the occurrence of both of (i) and (ii):






	 	(i)	 	the Original LPIC Insurer:






	 	(a)	 	is unable to pay its insurance obligations under the Original LPIC Policy in full as they
become due or admits in writing its inability generally to pay its insurance obligations under
insurance policies in full as they become due, or
	 
	 	(b)	 	enters into liquidation, or
	 
	 	(c)	 	is found to be insolvent in an insolvency proceeding in the United States or a
rehabilitator or other similar official is appointed for all or substantially all its assets, or
	 
	 	(d)	 	becomes subject to a corrective order or similar document issued by an insurance regulator
that cites or otherwise references the Original LPIC Insurer’s financial impairment or failure to
meet minimum levels of statutory capital or surplus and which prohibits payments of claims as and
when due;




and





	 	(ii)	 	the Original LPIC Insurer does not pay a loss in full when due in connection with
a Proof of Loss submitted by the Insured under the Original LPIC Policy; provided that this
condition (ii) shall not be satisfied if the Original LPIC Insurer has notified the Insured, on or
prior to the date on which such loss payment was due, that the non-payment of all or part of the
loss is due to a reason other than the






	C.	 	“Declarations” means the declaration pages attached to the front of this Policy.
	 
	D.	 	“Effective Date” has the meaning set forth in Item 2 of the Declarations.
	 
	E.	 	“Free Look Period” means the period during which a Retail Borrower or its assignee




 









 






[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.









	 	 	may, pursuant to the terms of a Covered Policy or applicable law, cancel such Covered Policy
and receive a refund of all premiums previously paid thereunder.
	 
	F.	 	“Insured” has the meaning set forth in the preamble of this Policy.
	 
	G.	 	“Insured’s Account” means a bank account of the Insured located in located in the State
of Georgia with the following account information:




Bank:

ABA:

Account Number:

Account Name:

Type of Account:





	H.	 	“Insurer” has the meaning set forth in the preamble of this Policy.
	 
	I.	 	“LPIC Premium” means, for each Covered Loan, the amount set forth as such in the
applicable Coverage Certificate.
	 
	J.	 	“Original LPIC Policy” means, as of any date, Lender Protection Insurance Policy, Policy
No. 7113491 issued by the Original LPIC Insurer and effective September 14, 2009, as the same may
be amended, endorsed, supplemented or otherwise modified from time to time through (i) such date or
(ii) if a Credit Event shall occur, the day prior to the day on which the Credit Event occurs.
	 
	K.	 	“Original LPIC Insurer” means Lexington Insurance Company or its successors and
permitted assigns under the Original LPIC Policy.
	 
	L.	 	“Periodic Bordereau” has the meaning set forth in Section III.C. of this Policy.
	 
	M.	 	“Policy” has the meaning set forth in the preamble hereof.
	 
	N.	 	“Surplus Lines Broker” has the meaning set forth in Item 6 of the Declarations.
	 
	O.	 	“Term” has the meaning set forth in Item 3 of the Declarations.
	 
	P.	 	“Transaction Documents” means this Policy, the Original LPIC Policy and any Coverage
Certificates issued under the Original LPIC Policy and incorporated by reference in this Policy, as
any of the foregoing may be amended, supplemented, amended and restated, or otherwise modified from
time to time.





Section VII. Confidentiality



The provisions of Section X Confidentiality of the Original LPIC Policy are incorporated herein by
reference and the Insurer, and the Insured agree to be bound hereunder by such provisions as if
such provisions were otherwise set forth herein.




Section VIII. General Policy Provisions







 









 





[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.




Except as otherwise set forth in this Section VIII, the provisions of Section XI General Policy
Provisions of the Original LPIC Policy are incorporated herein by reference and the Insurer, and
the Insured agree to be bound hereunder by such provisions as if such provisions were otherwise set
forth herein.





	A.	 	Assignment: This Policy and any and all rights under this Policy may not be assigned by
either party without the prior written consent of the other party; provided, however, that (i)
while the Insurer may continue to deal with the Insured in connection with all matters pertaining
to this Policy, the Insured may pledge its rights under this Policy as contemplated by the
Wholesale Loan Agreement and the Pledge and Security Agreement and (ii) the Insurer may assign this
Policy and any and all rights under this Policy to another U.S. domiciled member of the Berkshire
Hathaway group of insurance companies without the prior written consent of the Insured so long as
such other member company, at the time of transfer has a credit rating from either Standard &
Poor’s Rating Services, a division of the McGraw-Hill Companies, Inc. or Moody’s Investors
Services, Inc. equal to or better than that of the Insurer at the time of such assignment. The
Insurer shall not be bound by any assignment or transfer of interest that takes place without its
prior written consent.
	 
	B.	 	Changes and Waivers: This Policy may be amended, changed or modified, and the terms
hereof may be waived, only by a written instrument signed by each of the Insured and the Insurer
or, in the case of a waiver, by the party waiving compliance. No delay on the part of any party in
exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any
waiver on the part of any party of any right, power or privilege, nor any single or partial
exercise of any such right, power or privilege, preclude any further exercise thereof or the
exercise of any other such right, power or privilege.
	 
	C.	 	Third Parties: This Policy shall not be deemed to give any right or remedy whatsoever to
any Person other than the Insured or the Insurer unless said right or remedy is specifically
granted to such Person by the terms hereof.
	 
	D.	 	Entire Agreement: This Policy contains the full and complete understanding and agreement
between the parties hereto with respect to the subject matter hereof. The parties acknowledge that
neither is entering into this Policy in reliance upon any term, condition, representation or
warranty not stated herein or incorporated by reference and that this Policy replaces any and all
prior agreements whether oral or written, pertaining to the subject matter hereof.
	 
	E.	 	Construction: It is understood and agreed that this Policy is a manuscript policy that
has been negotiated at arm’s length and on equal footing as between the Insured and Insurer, that
both parties are sophisticated and that both parties fully understand and agree to all the terms
and conditions contained in this Policy. Accordingly, in any dispute concerning the meaning of this
Policy, or any term or condition hereof, such dispute shall be resolved without any presumption or
rule of construction in favor of either party or any related or similar doctrine.
	 
	F.	 	Bankruptcy: An Event of Bankruptcy with respect to the Insured or any other Person shall
not relieve the Insurer of any of its obligations hereunder.




 









 





[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.










	G.	 	Notices: Except as set forth in Section VIII.I. below, any communication required to be
given hereunder shall be effective only if in writing and shall be deemed sufficiently given only
if sent to the insured or to the insurer, as applicable, at Die address facsimile number shown
below, unless a change in address is received by the notifying party.
	 
	 	 	If to the Insurer:
	 
	 	 	National Fire & Marine Insurance Company

100 First Stamford Place

Stamford, CT 06902

Facsimile: (203) 363-5221

Attention: General Counsel
	 
	 	 	If to the Insured:
	 
	 	 	Imperial PFC Financing II, LLC

191 Peachtree Street NE, Suite 3300

Atlanta, Georgia 30303

Facsimile: (404) 736-3620

Attention: David Manchester
	 
	 	 	With regard to any notices or other documents referenced in this Policy that are to be
delivered to the Insured by any party other than the Insurer, such notices shall be deemed to
have been delivered to the Insured in the event that they were delivered to any named agent,
servant or employee of the Insured or any other third party appointed by the Insured to perform any
duties on behalf of the Insured in connection with this Policy.
	 
	H.	 	Governing Law: This Policy shall be interpreted and all disputes and controversies
arising under or related to this Policy shall be governed by and decided under the internal laws of
the State of New York (including without limitation Section 5-1401 of the General Obligations Law
of the State of New York), without regard to conflicts of laws principles that would require or
allow for the application of any other jurisdiction’s law.
	 
	I.	 	Service of Suit: Subject to Section XI.M. of the Original LPIC Policy and incorporated
herein by reference, in the event of failure of the Insurer to pay any amount claimed to be due
hereunder, the Insurer, at the request of the Insured, will submit to the jurisdiction of a court
of competent jurisdiction within the United States. Nothing in this condition constitutes or should
be understood to constitute a waiver of the Insurer’s rights to commence an action in any court of
competent jurisdiction in the United States, to remove an action to a United States District Court
or to seek a transfer of a case to another court as permitted by the laws of the United States or
of any state in the United States. Service of process in such suit may be made upon General
Counsel, National Fire & Marine Insurance Company, 100 First Stamford Place, Stamford, CT 06902 or
his or her representatives, with a copy to National Fire & Marine Insurance Company, 3024 Harney
Street, Omaha, NE 68131, Attention: President. In any suit instituted against the Insurer upon this
Policy, the Insurer shall abide by the final decision of such court or of any appellate court in
the event of any appeal.




 









 






[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.










	 	 	Further, pursuant to any statute of any state, territory, or district of the United States
which makes provision therefor, the Insurer hereby designates the Superintendent,
Commissioner, or Director of Insurance, other officer specified for that purpose in the statute, or
his or her successor or successors in office as its true and lawful attorney upon whom may be
served any lawful process in any action, suit, or proceeding instituted by or on behalf of the
Insured or any beneficiary hereunder arising out of this Policy, and hereby designates the above
named counsel as the individual to whom the said officer is authorized to mail such process or a
true copy thereof.
	 
	J.	 	Unwinding of Covered Policies: Notwithstanding any other provision in this Policy, if,
after the issuance of a Coverage Certificate, the applicable Retail Borrower exercises its right to
cancel a Covered Policy relating to the applicable Covered Loan within the applicable Free Look
Period, then (1) all coverage under this Policy relating to such Coverage Certificate shall be void
ab initio, (2) the Insurer shall return to the Insured all previously received Contingent LPIC
Premium relating to such Covered Loan and (3) each of the Insurer and the Insured shall bear its
own costs and expenses relating thereto, with no rights to indemnification from the other party for
such costs and expenses.
	 
	K.	 	Counterparts: This Policy may be executed in two or more counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and the same document.
	 
	L.	 	Validity: Notwithstanding anything to the contrary contained in this Policy or the
Original LPIC Policy, the termination of the Original LPIC Policy pursuant to Section VI.G. thereof
shall not affect the validity or enforceability of this Policy or each term, condition, limitation
and exclusion of the Original LPIC Policy incorporated by reference herein.





[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]








 









 






[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.




By signing below, the Secretary of the Insurer agrees on behalf of the Insurer to all of the terms
of this Policy.




	 	 	 	 	 
	 	 	 
	 	  	 	 
	 	 	Secretary 	 
	 	 	NATIONAL FIRE & MARINE INSURANCE

COMPANY 	 
	 


This Policy shall not be valid unless signed at the time of issuance by an authorized
representative of the Insurer on the Declarations page.



IN WITNESS WHEREOF, each of the Insured and the Surplus Lines Broker has caused this Policy to be
signed by its duly authorized representative:




	 	 	 	 	 	 	 	 	 	 	 	 	 

	IMPERIAL LIFE FINANCING II, LLC	 	 	 	WILLIAM LEE MERSHON

Georgia Surplus Lines License No.: 665715	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	 	 	By:	 	 	 	 
	 

	 	 
	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 	 	 	 	 	 	 






 









 





[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.



By signing below, the Secretary of the Insurer agrees on behalf of the Insurer to all of the terms
of this Policy.




	 	 	 	 	 
	 	 	 
	 	  	 	 
	 	 	Secretary 	 
	 	 	NATIONAL FIRE & MARINE INSURANCE

COMPANY 	 
	 


This Policy shall not be valid unless signed at the time of issuance by an authorized
representative of the Insurer on the Declarations page.



IN WITNESS WHEREOF, each of the Insured and the Surplus Lines Broker has caused this Policy to be
signed by its duly authorized representative:




	 	 	 	 	 	 	 	 	 	 	 	 	 

	IMPERIAL LIFE FINANCING II, LLC	 	 	 	WILLIAM LEE MERSHON

Georgia Surplus Lines License No.: 665715	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	 	 	By:	 	 	 	 
	 

	 	 
	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 	 	 	 	 	 	 






 









 





[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406
OF THE SECURITIES ACT OF 1933, AS AMENDED.



By signing below, the Secretary of the Insurer agrees on behalf of the Insurer to all of the terms
of this Policy.




	 	 	 	 	 
	 	 	 
	 	  	 	 
	 	 	Secretary 	 
	 	 	NATIONAL FIRE & MARINE INSURANCE

COMPANY 	 
	 


This Policy shall not be valid unless signed at the time of issuance by an authorized
representative of the Insurer on the Declarations page.



IN WITNESS WHEREOF, each of the Insured and the Surplus Lines Broker has caused this Policy to be
signed by its duly authorized representative:




	 	 	 	 	 	 	 	 	 	 	 	 	 

	IMPERIAL LIFE FINANCING II, LLC	 	 	 	WILLIAM LEE MERSHON

Georgia Surplus Lines License No.: 665715	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	 	 	By:	 	 	 	 
	 

	 	 
	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 	 	 	 	 	 	 
	 

	 	Title: