Document:

Exhibit 10.1

 

EXECUTION VERSION

 

FIRST AMENDMENT

 

FIRST AMENDMENT, dated as of September 15, 2016 (this “Amendment”), to the Amended and Restated Credit Agreement, dated as of July 13, 2015 (as amended or otherwise modified from time to time, the “Credit Agreement”), among WOLVERINE WORLD WIDE, INC., a Delaware corporation (the “Parent Borrower”), the several banks and other financial institutions or entities from time to time parties thereto (the “Lenders”), the several agents and other financial institutions or entities from time to time parties thereto, J.P. MORGAN EUROPE LIMITED, as foreign currency agent, and JPMORGAN CHASE BANK, N.A., as administrative agent (in such capacity, the “Administrative Agent”).

 

W  I  T  N  E  S  S  E  T  H:

 

WHEREAS, pursuant to the Credit Agreement, the Lenders have agreed to make, and have made, certain loans and other extensions of credit to the Parent Borrower;

 

WHEREAS, Section 10.1 of the Credit Agreement permits the Parent Borrower to amend the Credit Agreement with the written consent of the Administrative Agent and the Required Lenders;

 

WHEREAS, the Parent Borrower has requested that certain amendments and modifications be made to the Credit Agreement as set forth herein;

 

WHEREAS, each Lender that executes and delivers this Amendment agrees to the amendments and modifications to the Credit Agreement set forth herein; and

 

NOW THEREFORE, in consideration of the premises and mutual covenants hereinafter set forth, the parties hereto agree as follows:

 

SECTION 1.         Definitions.  Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

 

SECTION 2.         Effective Date.  This Amendment shall become effective as of the date (the “Effective Date”) on which the conditions set forth in this Section 2 have been satisfied:

 

(a)   Amendment.  The Administrative Agent shall have received this Amendment, executed and delivered by the Administrative Agent, the Parent Borrower and the Required Lenders.

 

(b)   Refinancing; Incremental Indebtedness.  The Administrative Agent shall have received satisfactory evidence of (i) the issuance of $250,000,000 in aggregate principal amount of the Parent Borrower’s 5.000% senior unsecured notes due 2026 and the application of all of the net proceeds thereof to fund the redemption or other discharge in full of the Parent Borrower’s outstanding Senior Unsecured Debt, (ii) the incurrence of Incremental Term Loans on the Effective Date on substantially the same terms as are applicable to the Tranche A Term Loans outstanding under the Credit Agreement as amended hereby in an aggregate principal amount equal to $150,000,000 and (iii) the establishment of Incremental Revolving Commitments on the Effective Date on the same terms as are applicable to the Revolving Facility outstanding under the Credit Agreement as amended hereby and in an aggregate principal amount equal to $100,000,000.

 

(c)   Representations and Warranties.  Each of the representations and warranties made by any Loan Party in or pursuant to the Loan Documents is true and correct in all material respects (except

 

 

for any representation or warranty which is already qualified as to materiality or by reference to Material Adverse Effect, which is true and correct in all respects) on and as of the date hereof as if made on and as of the date hereof, except to the extent such representations and warranties expressly relate to an earlier date, in which case such representations and warranties shall have been true and correct in all material respects as of such earlier date.

 

(d)   No Default.  No Default or Event of Default shall have occurred and be continuing on the date hereof or after giving effect to this Amendment.

 

SECTION 3.         Representations and Warranties.  The Parent Borrower represents and warrants to each of the Lenders and the Administrative Agent that, as of the Effective Date, (a) entry into this Amendment is within the Parent Borrower’s corporate powers, (b) this Amendment has been duly authorized by all necessary corporate, stockholder and shareholder action of the Parent Borrower and (c) assuming due execution and delivery by all parties other than the Parent Borrower, the Credit Agreement, as amended by this Amendment, constitutes a legal, valid and binding obligation of the Parent Borrower, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.

 

SECTION 4.         Amendments to the Credit Agreement.

 

(a)   Section 1.1 of the Credit Agreement is hereby amended by:

 

(i)        adding the following defined terms in appropriate alphabetical order:

 

“Adjusted Consolidated Net Income”: Consolidated Net Income; provided, that there will not be included in Adjusted Consolidated Net Income on an after tax basis: (a) any net after-tax effect of income (loss) from discontinued operations and any net after-tax gain or loss on disposal of discontinued operations; (b) any non-cash compensation expense recorded from grants of stock appreciation or similar rights, stock options, restricted stock or other rights to officers, directors or employees, including pursuant to any equity plan or stock option plan or any other management or employee benefit plan or agreement; (c) any impairment charges recorded in connection with the application of Accounting Standards Codification Topic 350, Intangibles—Goodwill and Other; and (d) any income or loss from the early extinguishment of Indebtedness or early termination of Hedging Obligations or other derivative instruments.

 

“Available Amount”: as of any date, the sum of (without duplication):

 

(i)            50% of Adjusted Consolidated Net Income for the period (treated as one accounting period) from June 19, 2016 to the end of the most recent fiscal quarter ending prior to such date for which financial statements are available (or, in case such Adjusted Consolidated Net Income is a deficit, minus 100% of such deficit); plus

 

(ii)           100% of the aggregate Net Cash Proceeds and the fair market value (as determined by the Parent Borrower in good faith) of marketable securities or other property received by the Parent Borrower from the issue or sale of its Capital Stock (other than Disqualified Capital Stock) or other capital contributions subsequent to the First Amendment Effective Date, other than:

 

2

 

(x)                                 Net Cash Proceeds received from an issuance or sale of such Capital Stock to a Subsidiary of the Parent Borrower or to an employee stock ownership plan, option plan or similar trust to the extent such sale to an employee stock ownership plan, option plan or similar trust is financed by loans from or guaranteed by the Parent Borrower or any Restricted Subsidiary unless such loans have been repaid with cash on or prior to the date of determination; and

 

(y)                                 Net Cash Proceeds received by the Parent Borrower from the issue and sale of such Capital Stock or capital contribution and, to the extent contributed to the Parent Borrower, the Net Cash Proceeds from the sale of Capital Stock of any of the Parent Borrower’s direct or indirect parent companies, in each case to existing or former directors, officers or employees of the Parent Borrower, or any of its Subsidiaries that occurs after the First Amendment Effective Date, to the extent the Net Cash Proceeds from the sale of such Capital Stock have not otherwise been applied to the payment of Restricted Payments; plus

 

(iii)          the amount by which Indebtedness of the Parent Borrower or its Restricted Subsidiaries is reduced on the Parent Borrower’s consolidated balance sheet upon the conversion or exchange (other than Indebtedness held by a Subsidiary of the Parent Borrower) subsequent to the First Amendment Effective Date of any Indebtedness of the Parent Borrower or its Restricted Subsidiaries convertible or exchangeable for Capital Stock (other than Disqualified Stock) of the Parent Borrower (less the amount of any cash, or the fair market value (as determined by the Parent Borrower in good faith) of any other property, distributed by the Parent Borrower upon such conversion or exchange); plus

 

(iv)          $75,000,000.

 

“Bail-In Action”: the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.

 

“Bail-In Legislation”: with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.

 

“EEA Financial Institution”: (a) any institution established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent;

 

“EEA Member Country”: any of the member states of the European Union, Iceland, Liechtenstein, and Norway.

 

“EEA Resolution Authority”: any public administrative authority or any Person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

 

3

 

“England”: the jurisdiction of the countries of England and Wales, and England shall be construed accordingly.

 

“English Security Documents”: the collective reference to any security documents governed by the laws of England hereafter delivered to the Administrative Agent in form and substance satisfactory to the Administrative Agent and any UK Borrower for the purpose of granting a Lien on any property of that UK Borrower.

 

“Excluded Domestic Subsidiary”: any Domestic Subsidiary for which becoming a Subsidiary Guarantor could reasonably be expected to result in material adverse tax consequences as determined in good faith by the Parent Borrower in consultation with the Administrative Agent.

 

“EU Bail-In Legislation Schedule”: the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor Person), as in effect from time to time.

 

“First Amendment”: that certain First Amendment, dated as of the First Amendment Effective Date, to this Agreement.

 

“First Amendment Effective Date”: September 15, 2016.

 

“Significant Subsidiary”: (i) any Restricted Subsidiary that would be a Significant Subsidiary of the Parent Borrower under Regulation S-X promulgated by the SEC or (ii) any group of Restricted Subsidiaries that, taken together (as of the date of the latest group of Restricted Subsidiaries that, taken together (as of the date of the latest audited consolidated financial statements of the Parent Borrower and its Restricted Subsidiaries), would constitute a Significant Subsidiary as defined in clause (i) above.

 

“UK Borrower”: any Additional Borrower incorporated in England.

 

“Write-Down and Conversion Powers”: with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.

 

(ii)       amending the definition of “Defaulting Lender” by inserting immediately after the phrase “has become the subject of a Bankruptcy Event” the text “or, with respect to any Lender party to the First Amendment or that becomes a Lender after the First Amendment Effective Date, a Bail-In Action”;

 

(iii)      amending the definition of “IP Reorganization” by deleting it in its entirety and replacing it with the following:

 

“IP Reorganization”: any direct or indirect transfer of the ownership of certain Intellectual Property of the Parent Borrower and its Subsidiaries and related agreements, licenses and other similar assets (such Intellectual Property and related assets, collectively, the “IP Assets”) to one or more Foreign Subsidiaries

 

4

 

or Foreign Holding Companies that are Wholly Owned Subsidiaries of the Parent Borrower.

 

(iv)      amending the definition of “IP Reorganization Transactions” by deleting it in its entirety and replacing it with the following:

 

“IP Reorganization Transactions”: a transaction or series of transactions entered into by the Parent Borrower and any of its Restricted Subsidiaries the purpose of which is to effect an IP Reorganization.

 

(v)       amending the definition of “Reinvestment Prepayment Date” by replacing the phrase “six months after such Reinvestment Event” therein with the phrase “twelve months (or, if the Parent Borrower or a Subsidiary shall have entered into a legally binding commitment within twelve months after such Reinvestment Event to acquire or repair assets useful in the Parent Borrower’s or the applicable Subsidiary’s business with the applicable Reinvestment Deferred Amount, eighteen months) after such Reinvestment Event”;

 

(vi)      amending the definition of “Subsidiary Guarantor” by inserting immediately after the phrase “any Excluded Foreign Subsidiary” the text “, any Excluded Domestic Subsidiary”; and

 

(vii)     deleting the following definitions in their entirety: “New CFC,” “New CFC Entities,” “New CFC Subsidiary,” “U.S. Newco,” “New CFC Intercompany Note” and “WILP”.

 

(b)   Section 1.2(c) of the Credit Agreement is hereby amended by deleting it in its entirety and replacing it with the following:

 

“(c) For the avoidance of doubt, if any transaction (including without limitation any Investment, any incurrence of Indebtedness, and any Restricted Payment) is permitted at the time of consummation of such transaction under Sections 7.2 through 7.19 of the Credit Agreement based on the calculation of a financial test or definition (including without limitation any financial test or definition based on Consolidated Net Income, Adjusted Consolidated Net Income, the Consolidated Leverage Ratio, the Consolidated Secured Leverage Ratio, Consolidated Tangible Assets or Consolidated Total Assets, and including without limitation any such financial test or definition determined on a pro forma basis) then such transaction will be deemed to be in compliance with Sections 7.2 through 7.19 of the Credit Agreement notwithstanding any future change in such financial test or definition.”

 

(c)   Section 2.12(b) of the Credit Agreement is hereby amended by replacing the amount “$40,000,000” in each place therein with the amount “ $75,000,000”.

 

(d)   The penultimate paragraph of Section 2.24 of the Credit Agreement is hereby amended by inserting immediately after the phrase “If a Bankruptcy Event” the phrase “or a Bail-In Action”.

 

(e)   Section 2.25(a)(A) of the Credit Agreement is hereby amended by replacing (x) the amount “$1,425,000,000” therein with the amount “ $1,750,000,000” and (y) the ratio “2.50:1.00” therein with the ratio “3.00:1.00”.

 

(f)    Article IV of the Credit Agreement is hereby amended by adding the following as a new Section 4.24 therein:

 

5

 

“Section 4.24        EEA Financial Institutions.  No Loan Party is an EEA Financial Institution.”

 

(g)   Section 5.5(d) is hereby amended by adding at the end of such section the following:

 

“Notwithstanding the foregoing, no such foreign security documents shall be required to be governed by the law of any jurisdiction other than the jurisdiction in which the applicable Additional Borrower is organized.”

 

(h)   Section 6.12 of the Credit Agreement is hereby amended by deleting it in its entirety and replacing it with “[Reserved].”.

 

(i)    The lead-in to Article VII of the Credit Agreement is hereby amended by deleting it in its entirety and replacing it with the following:

 

“The Parent Borrower hereby agrees that, so long as the Commitments remain in effect, any Letter of Credit remains outstanding or any Loan or other amount (other than contingent indemnification obligations) is owing to any Lender or the Administrative Agent hereunder, the Parent Borrower shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly:”

 

(j)    Section 7.2(b)(v) is hereby amended and restated to read in its entirety as follows:

 

“(v) any Restricted Subsidiary to the Parent Borrower or any other Restricted Subsidiary incurred pursuant to any IP Reorganization Transaction permitted under Section 7.19”,

 

(k)   Section 7.2(n)(i)(A) of the Credit Agreement is hereby amended by replacing (x) the amount “$1,425,000,000” therein with the amount “ $1,750,000,000” and (y) the ratio “2.50:1.00” therein with the ratio “3.00:1.00”.

 

(l)    Section 7.3 of the Credit Agreement is hereby amended by deleting the proviso at the end thereof.

 

(m)  Section 7.4(b) and Section 7.4(c) of the Credit Agreement are hereby amended by replacing the words “IP Reorganization Transaction” in each of such sections with the words “IP Reorganization Transaction permitted by Section 7.19”.

 

(n)   Section 7.5(d) of the Credit Agreement is hereby amended by replacing the words “IP Reorganization Transaction” therein with the words “IP Reorganization Transaction permitted by Section 7.19”.

 

(o)   Section 7.5(l) of the Credit Agreement is hereby amended by replacing the amount “10%” therein with the amount “15%”.

 

(p)   Section 7.6(a) of the Credit Agreement is hereby amended by replacing the words “IP Reorganization Transaction” therein with the words “IP Reorganization Transaction permitted by Section 7.19”.

 

(q)   Section 7.6(e) of the Credit Agreement is hereby amended by deleting it in its entirety and replacing it with the following:

 

6

 

“(e) so long as no Default or Event of Default shall have occurred and be continuing, the Parent Borrower and its Restricted Subsidiaries may declare and make additional Restricted Payments; provided that such Restricted Payments shall not exceed the sum of (i) $50,000,000 in the aggregate in any fiscal year if, on a pro forma basis, after giving effect to the making of such Restricted Payment and the incurrence of any Indebtedness in connection therewith, the Consolidated Leverage Ratio, recomputed as of the last day of the most recently ended fiscal quarter of the Parent Borrower for which financial statements are available, is greater than or equal to 3.50:1.00 plus (ii) the Available Amount if, on a pro forma basis, after giving effect to the making of such Restricted Payment and the incurrence of any Indebtedness in connection therewith, the Consolidated Leverage Ratio, recomputed as of the last day of the most recently ended fiscal quarter of the Parent Borrower for which financial statements are available, is less than 4.25:1.00 but greater than or equal to 3.50:1.00; provided, further, for the avoidance of doubt, that any such additional Restricted Payment shall not be subject to any monetary limitation hereunder so long as, on a pro forma basis, after giving effect to the making of such Restricted Payment and the incurrence of any Indebtedness in connection therewith, the Consolidated Leverage Ratio, recomputed as of the last day of the most recently ended fiscal quarter of the Parent Borrower for which financial statements are available, is less than 3.50:1.00.”

 

(r)    Section 7.7(e) of the Credit Agreement is hereby amended by deleting it in its entirety and replacing it with the following:

 

“(e) subject to Section 7.19, the Parent Borrower and its Restricted Subsidiaries may make additional Investments, loans or advances in connection with IP Reorganization Transactions;”

 

(s)    Section 7.7(f)(iv) of the Credit Agreement is hereby amended by replacing the amount “$100,000,000” therein with the phrase “the greater of $175,000,000 and 10% of Consolidated Tangible Assets”.

 

(t)    Section 7.7(f)(vi) of the Credit Agreement is hereby amended by replacing the words “IP Reorganization Transaction” therein with the words “IP Reorganization Transaction permitted by Section 7.19”.

 

(u)   Section 7.7(h)(iv) of the Credit Agreement is hereby amended by replacing the amount “$150,000,000” therein with the phrase “the greater of (i) $250,000,000 in the aggregate if, on a pro forma basis, after giving effect to the making of such Investment and the incurrence of any Indebtedness in connection therewith, the Consolidated Leverage Ratio, recomputed as of the last day of the most recently ended fiscal quarter of the Parent Borrower for which financial statements are available, is greater than or equal to 3.50:1.00 and (ii) an amount such that, on a pro forma basis, after giving effect to the making of such Investment and the incurrence of any Indebtedness in connection therewith, the Consolidated Leverage Ratio, recomputed as of the last day of the most recently ended fiscal quarter of the Parent Borrower for which financial statements are available, is less than 3.50:1.00”.

 

(v)   Section 7.7 of the Credit Agreement is hereby amended by adding the following at the end thereof:

 

“Investments shall be valued at cost (without giving effect to any subsequent increases in value); provided, that the outstanding amount thereof at any time shall be valued net of

 

7

 

returns on such Investments received by Parent Borrower or any of its Restricted Subsidiaries”.

 

(w)  Section 7.11 of the Credit Agreement is hereby amended by adding the following immediately before the end thereof:

 

“, provided that commencing in the 2017 fiscal year of the Parent Borrower, the fiscal quarters of the Parent Borrower may be modified to be based on one five-week period and two four-week periods per fiscal quarter”

 

(x)   Sections 7.16 and 7.17 of the Credit Agreement are hereby amended by deleting each in its entirety and replacing each with “[Reserved].”.

 

(y)   Article VII of the Credit Agreement is hereby amended by adding the following as a new Section 7.19 therein:

 

“7.19.  IP Reorganizations.  Notwithstanding the foregoing provisions of Article VII of the Credit Agreement, so long as no Default or Event of Default shall have occurred and be continuing, the Parent Borrower and its Subsidiaries may consummate the IP Reorganization (including any IP Reorganization Transactions); provided that either (a) on a pro forma basis, after giving effect to any such IP Reorganization (including any IP Reorganization Transactions), including the incurrence of any Indebtedness in connection therewith, the Consolidated Leverage Ratio, recomputed as of the last day of the most recently ended fiscal quarter of the Parent Borrower for which financial statements are available, is less than 3.50:1.00 or (b) the value (as reasonably determined by Parent Borrower) of the IP Assets to be transferred from the Parent Borrower or Subsidiary Guarantors to Subsidiaries that are not Subsidiary Guarantors, without duplication, in such IP Reorganization (including any IP Reorganization Transactions) does not at the time of transfer exceed 67.0% of the total value (as reasonably determined by Parent Borrower) of the IP Assets of the Parent Borrower and the Subsidiary Guarantors as of the last day of the most recently ended fiscal quarter of the Parent Borrower for which financial statements are available.”

 

(z)   Sections 8(f) and 8(h) of the Credit Agreement are each hereby amended by replacing the phrase “any Group Member” in each place therein with the phrase “the Parent Borrower or any Significant Subsidiary.”

 

(aa)         Section 9.1 of the Credit Agreement is hereby amended by adding “(a)” immediately after the heading therefor and by adding the following as a new clause (b) therein:

 

“(b) Each Lender hereby irrevocably designates and appoints the Administrative Agent as the security trustee of such Lender under the English Security Documents, and each such Lender irrevocably authorizes the Administrative Agent, in such capacity, to take such action on its behalf under the provisions of the English Security Documents and to exercise such powers and perform such rights, powers, authorities and discretions as are expressly delegated to the Administrative Agent by the terms of the English Security Documents, together with such other rights, powers, authorities and discretions as are reasonably incidental thereto. Without limiting the generality of the foregoing, each Lender hereby authorizes the Administrative Agent to enter into each English Security Document on behalf of and for the benefit of the Lenders and the other Secured Parties and agrees to be bound by the terms thereof. It is understood and agreed that the Administrative Agent shall not have any duties or responsibilities, except those set forth in the English Security Documents, or any fiduciary relationship with any Lender, and no implied

 

8

 

covenants, functions, responsibilities, duties, obligations or liabilities shall be read into any Loan Document or otherwise exist against the Administrative Agent.”

 

(bb)         Article IX of the Credit Agreement is hereby amended by adding the contents of Annex 1 hereto as a new Section 9.12 therein.

 

(cc)         Article X of the Credit Agreement is hereby amended by adding the contents of Annex 2 hereto as a new Section 10.22 therein.

 

SECTION 5.         Effect of Amendment.

 

(a)   Except as expressly set forth herein, this Amendment shall not by implication or otherwise limit, impair, constitute a waiver of or otherwise affect the rights and remedies of the Lenders or the Administrative Agent under the Credit Agreement or any other Loan Document, and shall not alter, modify, amend or in any way affect any of the terms, conditions, obligations, covenants or agreements contained in the Credit Agreement or any other provision of the Credit Agreement or of any other Loan Document, all of which are ratified and affirmed in all respects and shall continue in full force and effect. Other than as expressly set forth herein, nothing herein shall be deemed to entitle the Parent Borrower to a consent to, or a waiver, amendment, modification or other change of, any of the terms, conditions, obligations, covenants or agreements contained in the Credit Agreement or any other Loan Document in similar or different circumstances. Nothing in this Amendment shall be deemed to be a novation of any obligations under the Credit Agreement or any other Loan Document.

 

(b)   On and after the Effective Date, each reference in the Credit Agreement to “this Agreement”, “hereunder”, “hereof”, “herein”, or words of like import, and each reference to the Credit Agreement in any other Loan Document shall be deemed a reference to the Credit Agreement as amended hereby.  This Amendment shall constitute a “Loan Document” for all purposes of the Credit Agreement and the other Loan Documents.

 

SECTION 6.         General.

 

(a)   GOVERNING LAW.  THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

(b)   Costs and Expenses.  The Parent Borrower agrees to reimburse the Administrative Agent for its reasonable out-of-pocket expenses in connection with this Amendment, including the reasonable fees, charges and disbursements of counsel for the Administrative Agent.

 

(c)   Counterparts.  This Amendment may be executed by one or more of the parties to this Amendment on any number of separate counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument.  Delivery of an executed signature page of this Amendment by email or facsimile transmission shall be effective as delivery of a manually executed counterpart hereof.

 

(d)   Headings.  The headings of this Amendment are used for convenience of reference only, are not part of this Amendment and shall not affect the construction of, or be taken into consideration in interpreting, this Amendment.

 

[remainder of page intentionally left blank]

 

9

 

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered by their respective duly authorized officers as of the day and year first above written.

 

	
 
    	
WOLVERINE WORLD WIDE, INC., as Parent

Borrower
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Michael D. Stornant
    
	
 
    	
 
    	
Name:
    	
Michael D. Stornant
    
	
 
    	
 
    	
Title:
    	
Senior Vice President, Chief

Financial Officer and Treasurer
    

 

Signature Page to Amendment

 

 

	
 
    	
 
    	
JPMORGAN CHASE BANK,   N.A., as Administrative Agent
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Krys Szremski
    
	
 
    	
 
    	
Name:
    	
Krys Szremski
    
	
 
    	
 
    	
Title:
    	
Executive Director
    

 

Signature Page to Amendment

 

 

	
 
    	
 
    	
Citizens Bank, N.A., as   a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Thomas Lass
    
	
 
    	
 
    	
Name: Thomas Lass
    
	
 
    	
 
    	
Title: SVB
    

 

Signature Page to Amendment

 

 

	
 
    	
 
    	
MUFG Union Bank, N.A.,   as a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Victor Pierzchalski
    
	
 
    	
 
    	
Name: 
    	
Victor Pierzchalski
    
	
 
    	
 
    	
Title:   
    	
Authorized   Signatory
    

 

Signature Page to Amendment

 

 

	
 
    	
 
    	
SUMITOMO MITSUI BANKING   CORPORATION,
    
	
 
    	
 
    	
as a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ James D. Weinstein
    
	
 
    	
 
    	
Name:  James D. Weinstein
    
	
 
    	
 
    	
Title:  Managing Director
    

 

Signature Page to Amendment

 

 

	
 
    	
 
    	
KeyBank National Association,   as a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Marianne T. Meil
    
	
 
    	
 
    	
Name:
    	
Marianne T. Meil
    
	
 
    	
 
    	
Title:
    	
Senior Vice President
    

 

Signature Page to Amendment

 

 

	
 
    	
 
    	
Fifth Third Bank, as a   Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Michael J.   Schaltz, Jr.
    
	
 
    	
 
    	
Name: Michael J.   Schaltz, Jr.
    
	
 
    	
 
    	
Title: Vice President
    

 

Signature Page to Amendment

 

 

	
 
    	
 
    	
Compass Bank, as a   Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Sandra Centa
    
	
 
    	
 
    	
Name: Sandra Centa
    
	
 
    	
 
    	
Title: SVP
    

 

Signature Page to Amendment

 

 

	
 
    	
 
    	
The Huntington National   Bank,
    
	
 
    	
 
    	
as a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Steven J. McCormack
    
	
 
    	
 
    	
Name: Steven J.   McCormack
    
	
 
    	
 
    	
Title: Senior Vice   President
    

 

Signature Page to Amendment

 

 

	
 
    	
 
    	
Wells Fargo Bank, N.A.,   as a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Kevin Kobiela
    
	
 
    	
 
    	
Name: /s/ Kevin Kobiela
    
	
 
    	
 
    	
Title: AVP
    

 

Signature Page to Amendment

 

 

	
 
    	
 
    	
The Northern Trust   Company, as a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Wicks Barkhausen
    
	
 
    	
 
    	
Name: Wicks Barkhausen
    
	
 
    	
 
    	
Title: Vice President
    

 

Signature Page to Amendment

 

 

	
 
    	
 
    	
PNC BANK, NATIONAL   ASSOCIATION, as a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Joshua A. Droppers
    
	
 
    	
 
    	
Name: Joshua A.   Droppers
    
	
 
    	
 
    	
Title: Assistant Vice   President
    

 

Signature Page to Amendment

 

 

	
 
    	
 
    	
The Private Bank, as a   Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Mark D. Debniak
    
	
 
    	
 
    	
Name: Mark D. Debniak
    
	
 
    	
 
    	
Title: Managing   Director
    

 

Signature Page to Amendment

 

 

	
 
    	
 
    	
Bank of America, as a   Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ T. Scott Fiser
    
	
 
    	
 
    	
Name: T. Scott Fiser
    
	
 
    	
 
    	
Title: Senior Vice   President
    

 

Signature Page to Amendment

 

 

	
 
    	
 
    	
Branch Banking &   Trust Company, as a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Brian J. Blomeke
    
	
 
    	
 
    	
Name: Brian J. Blomeke
    
	
 
    	
 
    	
Title: Senior Vice   President
    

 

Signature Page to Amendment

 

 

	
 
    	
 
    	
HSBC Bank USA, N.A., as   a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Meredith Philips
    
	
 
    	
 
    	
Name: Meredith Philips
    
	
 
    	
 
    	
Title: Assistant Vice   President
    

 

Signature Page to Amendment

 

	
 
    	
 
    	
 
    
	
 
    	
 
    	
JPMORGAN CHASE BANK,   N.A., as a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Krys Szremski
    
	
 
    	
 
    	
Name: Krys Szremski
    
	
 
    	
 
    	
Title: Executive   Director
    

 

Signature Page to Amendment

 

 

Annex I

 

Amendments to Section 9.12

 

9.12  Appointment of Administrative Agent as Security Trustee for English Security Documents. For the purposes of any Liens or Collateral created under the English Security Documents, the following additional provisions shall apply, in addition to the provisions set out in the foregoing sections of this Article 9 or otherwise hereunder (without prejudice to the rights and obligations of the Administrative Agent under the other provisions of this Agreement and the other Loan Documents), and the following additional provisions of this Section 9.12 shall be governed by English law.

 

(a)                                 In this Section 9.12, the following expressions have the following meanings: (i) “Appointee” means any receiver, administrator or other insolvency officer appointed in respect of any Loan Party or its assets; (ii) “Charged Property” means the assets of the Loan Parties subject to a security interest under the English Security Documents, and (iii) “Delegate” means any delegate, agent, attorney or co-trustee appointed by the Administrative Agent (in its capacity as security trustee).

 

(b)                                 The Secured Parties appoint the Administrative Agent to hold the security interests constituted by the English Security Documents on trust for the Secured Parties on the terms of the Loan Documents and the Administrative Agent accepts that appointment.

 

(c)                                  The Administrative Agent, its subsidiaries and associated companies may each retain for its own account and benefit any fee, remuneration and profits paid to it in connection with (i) its activities under the Loan Documents; and (ii) its engagement in any kind of banking or other business with any Loan Party.

 

(d)                                 Nothing in this Agreement constitutes the Administrative Agent as a trustee or fiduciary of, nor shall the Administrative Agent have any duty or responsibility to, any Loan Party.

 

(e)                                  The Administrative Agent shall have no duties or obligations to any other Person except for those which are expressly specified in the Loan Documents or mandatorily required by applicable law.

 

(f)                                   The Administrative Agent may appoint one or more Delegates on such terms (which may include the power to sub-delegate) and subject to such conditions as it thinks fit, to exercise and perform all or any of the duties, rights, powers and discretions vested in it by the English Security Documents and shall not be obliged to supervise any Delegate or be responsible to any person for any loss incurred by reason of any act, omission, misconduct or default on the part of any Delegate.

 

(g)                                  The Administrative Agent may (whether for the purpose of complying with any law or regulation of any overseas jurisdiction, or for any other reason) appoint (and subsequently remove) any person to act jointly with the Administrative Agent either as a separate trustee or as a co-trustee on such terms and subject to such conditions as the Administrative Agent thinks fit and with such of the duties, rights, powers and discretions vested in the Administrative Agent by the English Security Documents as may be conferred by the instrument of appointment of that person.

 

 

(h)                                 The Administrative Agent shall notify the Lenders of the appointment of each Appointee (other than a Delegate).

 

(i)                                     The Administrative Agent may pay reasonable remuneration to any Delegate or Appointee, together with any costs and expenses (including legal fees) reasonably incurred by the Delegate or Appointee in connection with its appointment. All such remuneration, costs and expenses shall be treated, for the purposes of this Agreement, as paid or incurred by the Administrative Agent.

 

(j)                                    Each Delegate and each Appointee shall have every benefit, right, power and discretion and the benefit of every exculpation (together “Rights”) of the Administrative Agent (in its capacity as security trustee) under the English Security Documents, and each reference to the Administrative Agent (where the context requires that such reference is to the Administrative Agent in its capacity as security trustee) in the provisions of the English Security Documents which confer Rights shall be deemed to include a reference to each Delegate and each Appointee.

 

(k)                                 Each Secured Party confirms its approval of the English Security Documents and authorizes and instructs the Administrative Agent: (i) to execute and deliver the English Security Documents; (ii) to exercise the rights, powers and discretions given to the Administrative Agent (in its capacity as security trustee) under or in connection with the English Security Documents together with any other incidental rights, powers and discretions; and (iii) to give any authorizations and confirmations to be given by the Administrative Agent (in its capacity as security trustee) on behalf of the Secured Parties under the English Security Documents.

 

(l)                                     The Administrative Agent may accept without inquiry the title (if any) which any person may have to the Charged Property.

 

(m)                             Each other Secured Party confirms that it does not wish to be registered as a joint proprietor of any security interest constituted by an English Security Document and accordingly authorizes: (a) the Administrative Agent to hold such security interest in its sole name (or in the name of any Delegate) as trustee for the Secured Parties; and (b) the Land Registry (or other relevant registry) to register the Administrative Agent (or any Delegate or Appointee) as a sole proprietor of such security interest.

 

(n)         Except to the extent that an English Security Document otherwise requires, any moneys which the Administrative Agent receives under or pursuant to an English Security Document may be: (a) invested in any investments which the Administrative Agent selects and which are authorized by applicable law; or (b) placed on deposit at any bank or institution (including the Administrative Agent) on terms that the Administrative Agent thinks fit, in each case in the name or under the control of the Administrative Agent, and the Administrative Agent shall hold those moneys, together with any accrued income (net of any applicable Tax) to the order of the Lenders, on trust for the Lenders, and shall pay them to the Lenders in accordance with the terms of the relevant English Security Document.

 

(o)                                 On a disposal of any of the Charged Property which is permitted under the Loan Documents or any other release permitted under Section 10.14, the Administrative Agent shall (at the cost of the Loan Parties) execute any release of the English Security Documents or other claim over that Charged Property and issue any certificates of non-crystallisation of floating charges that may be required or take any other action that the Administrative Agent considers desirable.

 

(p)                                 The Administrative Agent shall not be liable for:

 

(i)                                     any defect in or failure of the title (if any) which any person may have to any assets over which security is intended to be created by an English Security

 

 

Document;

 

(ii)                                  any loss resulting from the investment or deposit at any bank of moneys which it invests or deposits in a manner permitted by an English Security Document;

 

(iii)                               the exercise of, or the failure to exercise, any right, power or discretion given to it by or in connection with any Loan Document or any other agreement, arrangement or document entered into, or executed in anticipation of, under or in connection with, any Loan Document; or

 

(iv)                              any shortfall which arises on enforcing an English Security Document.

 

(q)                                 The Administrative Agent shall not be obligated to:

 

(i)                                     obtain any authorization or environmental permit in respect of any of the Charged Property or an English Security Document;

 

(ii)                                  hold in its own possession an English Security Document, title deed or other document relating to the Charged Property or an English Security Document;

 

(iii)                               perfect, protect, register, make any filing or give any notice in respect of an English Security Document (or the order of ranking of an English Security Document), unless that failure arises directly from its own gross negligence or wilful misconduct; or

 

(iv)                              require any further assurances in relation to an English Security Document.

 

(r)                                    In respect of any English Security Document, the Administrative Agent shall not be obligated to: (i) insure, or require any other person to insure, the Charged Property; or (ii) make any enquiry or conduct any investigation into the legality, validity, effectiveness, adequacy or enforceability of any insurance existing over such Charged Property.

 

(s)                                   In respect of any English Security Document, the Administrative Agent shall not have any obligation or duty to any person for any loss suffered, and it shall not be liable for any damages, costs or losses to any person, as a result of: (i) the lack or inadequacy of any insurance; or (ii) the failure of the Administrative Agent to notify the insurers of any material fact relating to the risk assumed by them, or of any other information of any kind, unless Required Lenders have requested it to do so in writing and the Administrative Agent has failed to do so within fourteen days after receipt of that request.

 

(t)                                    Every appointment of a successor Administrative Agent under an English Security Document shall be by deed.

 

(u)                                 Section 1 of the Trustee Act 2000 (UK) shall not apply to the duty of the Administrative Agent in relation to the trusts constituted by this Agreement.

 

(v)                                 In the case of any conflict between the provisions of this Agreement and those of the Trustee Act 1925 (UK) or the Trustee Act 2000 (UK), the provisions of this Agreement shall prevail

 

 

to the extent allowed by law, and shall constitute a restriction or exclusion for the purposes of the Trustee Act 2000 (UK).

 

(w)                               The perpetuity period under the rule against perpetuities if applicable to this Agreement and any English Security Document shall be 80 years from the date of this Agreement.

 

 

Annex II

 

Amendments to Section 10.22

 

SECTION 10.22.  Acknowledgement and Consent to Bail-In of EEA Financial Institutions.  Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any EEA Financial Institution arising under any Loan Document may be subject to the Write-Down and Conversion Powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:

 

(a)  the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an EEA Financial Institution; and

 

(b)  the effects of any Bail-In Action on any such liability, including, if applicable:

 

(i) a reduction in full or in part or cancellation of any such liability;

 

(ii) a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEA Financial Institution, its parent entity, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or

 

(iii) the variation of the terms of such liability in connection with the exercise of the Write-Down and Conversion Powers of any EEA Resolution Authority.Exhibit 10.1

 

 

 

 

 

 

 

 

 

	LOAN
    AND SECURITY AGREEMENT
	 
	Dated
    as of September 14, 2016
	 
	Among
	 
	GWG
    DLP Funding IV, LLC,
	as
    Borrower
	 
	THE
    FINANCIAL INSTITUTIONS PARTY HERETO,
	as
    Lenders
	 
	And
	 
	CLMG
    CORP.,
	 
	as
    Administrative Agent

 

 

 

 

 

 

 

 

 

     

     

    

 

TABLE
OF CONTENTS

 

	 	 	Page
	ARTICLE I DEFINITIONS	1
	Section
    1.1	Defined
    Terms	1
	Section
    1.2	Other
    Definitional Provisions	1
	Section
    1.3	Other
    Terms	1
	Section
    1.4	Computation
    of Time Periods	2
	ARTICLE II THE LENDERS’ COMMITMENTS, BORROWING PROCEDURES, SECURITY INTEREST AND LENDER NOTES	2
	Section
    2.1	Lenders’
    Commitments	2
	Section
    2.2	Borrowing
    Procedures	3
	Section
    2.3	Funding	4
	Section
    2.4	Representation
    and Warranty	6
	Section
    2.5	Lender
    Notes	7
	Section
    2.6	Security
    Interest	7
	Section
    2.7	Sale
    of Collateral	9
	Section
    2.8	Permitted
    Purposes	9
	Section
    2.9	Closing
    Fee	10
	ARTICLE III INTEREST; INTEREST PERIODS; FEES, ETC.	11
	Section
    3.1	Interest
    Rates	11
	Section
    3.2	Interest
    Payment Dates	11
	Section
    3.3	Fees	11
	Section
    3.4	Computation
    of Interest and Fees	11
	ARTICLE IV PAYMENTS; PREPAYMENTS	11
	Section
    4.1	Repayments
    and Prepayments	11
	Section
    4.2	Yield
    Maintenance Fee	12
	Section
    4.3	Making
    of Payments	12
	Section
    4.4	Due
    Date Extension	13
	ARTICLE V ACCOUNTS; DISTRIBUTION OF COLLECTIONS	13
	Section
    5.1	Accounts	13
	Section
    5.2	Application
    of Available Amounts	15
	Section
    5.3	Permitted
    Investments	19
	ARTICLE VI INCREASED COSTS, ETC.	20
	Section
    6.1	Increased
    Costs	20

 

    i

     

    

 

	Section
    6.2	Funding
    Losses	21
	Section
    6.3	Withholding
    Taxes	21
	ARTICLE VII CONDITIONS TO BORROWING	22
	Section
    7.1	Conditions
    Precedent to the Closing and the First Initial Advance	22
	Section
    7.2	Conditions
    Precedent to the Second Initial Advance	25
	Section
    7.3	Conditions
    Precedent to each Ongoing Maintenance Advance	28
	Section
    7.4	Conditions
    Precedent to each Additional Policy Advance	30
	Section
    7.5	Lender
    Valuation	30
	ARTICLE VIII REPRESENTATIONS AND WARRANTIES	32
	Section
    8.1	Representations
    and Warranties of the Borrower	32
	ARTICLE IX COVENANTS	37
	Section
    9.1	Affirmative
    Covenants	37
	Section
    9.2	Negative
    Covenants	47
	ARTICLE X EVENTS OF DEFAULT; REMEDIES	49
	Section
    10.1	Events
    of Default	49
	Section
    10.2	Remedies	52
	ARTICLE XI INDEMNIFICATION	55
	Section
    11.1	General
    Indemnity	55
	ARTICLE XII ADMINISTRATIVE AGENT	56
	Section
    12.1	Appointment	56
	Section
    12.2	Delegation
    of Duties	56
	Section
    12.3	Exculpatory
    Provisions	56
	Section
    12.4	Reliance
    by the Administrative Agent	57
	Section
    12.5	Notice
    of Default	57
	Section
    12.6	Non-Reliance
    on the Administrative Agent and Other Lenders	58
	Section
    12.7	Indemnification	58
	Section
    12.8	The
    Administrative Agent in Its Individual Capacity	58
	Section
    12.9	Successor
    Administrative Agent	59
	ARTICLE XIII MISCELLANEOUS	59
	Section
    13.1	Amendments,
    Etc	59
	Section
    13.2	Notices,
    Etc	59
	Section
    13.3	No
    Waiver; Remedies	60
	Section
    13.4	Binding
    Effect; Assignability; Term	60
	Section
    13.5	GOVERNING
    LAW; JURY TRIAL	60

 

    ii

     

    

 

	Section
    13.6	Execution
    in Counterparts	61
	Section
    13.7	Submission
    to Jurisdiction	61
	Section
    13.8	Costs
    and Expenses	61
	Section
    13.9	Severability
    of Provisions	61
	Section
    13.10	ENTIRE
    AGREEMENT	61
	Section
    13.11	Conflicts	62
	Section
    13.12	Confidentiality	62
	Section
    13.13	Limitation
    on Liability	63
	Section
    13.14	Relationship
    of Parties	64

 

	SCHEDULES	 
	 	 
	SCHEDULE
    2.1(a)	Lenders’
    Commitments
	SCHEDULE
    2.8	Payment
    Direction
	SCHEDULE
    8.1(s)	Account
    Information
	SCHEDULE
    8.1(x)	Retained
    Death Benefit Policies
	SCHEDULE
    13.2	Notice
    Addresses
	ELIGIBILITY
    CRITERIA EXCEPTION SCHEDULE	Eligibility
    Criteria Exceptions
	 	 
	EXHIBITS	 
	 	 
	EXHIBIT
    A	Form
    of Borrowing Request
	EXHIBIT
    B	Form
    of Lender Note
	EXHIBIT
    C	Form
    of Assignment and Assumption Agreement
	EXHIBIT
    D	Form
    of Calculation Date Report
	EXHIBIT
    E	Form
    of Annual Budget
	EXHIBIT
    F	Form
    of Borrowing Base Certificate
	 	 
	ANNEXES	 
	 	 
	ANNEX
    I	List
    of Defined Terms

 

 

    iii

     

    

 

THIS
LOAN AND SECURITY AGREEMENT (this “Loan Agreement”) is made and entered into as of September 14, 2016, among
GWG DLP Funding IV, LLC, a Delaware limited liability company (the “Borrower”), the financial institutions
party hereto as Lenders (the “Lenders”), and CLMG Corp., a Texas corporation, as the administrative agent for
the Lenders (in such capacity, the “Administrative Agent”).

 

W
I T N E S S E T H:

 

WHEREAS,
the Borrower desires that the Lenders agree to extend financing to the Borrower on the terms and conditions set forth herein.

 

WHEREAS,
the Lenders are willing to provide such financing on the terms and conditions set forth in this Loan Agreement.

 

NOW,
THEREFORE, in consideration of the premises and the mutual agreements herein contained, the parties hereto agree as follows:

 

ARTICLE
I

DEFINITIONS

 

Section
1.1Defined Terms. Capitalized terms used and not otherwise defined in this Loan Agreement shall have the meanings given
to them in the List of Defined Terms attached hereto as Annex I.

 

Section
1.2Other Definitional Provisions.

 

(a)Unless
otherwise specified therein, all terms defined in this Loan Agreement have the meanings as so defined herein when used in the
Lender Notes or any other Transaction Document, certificate, report or other document made or delivered pursuant hereto.

 

(b)Each
term defined in the singular form in Section 1.1 or elsewhere in this Loan Agreement shall mean the plural thereof when
the plural form of such term is used in this Loan Agreement, the Lender Notes or any other Transaction Document, and each term
defined in the plural form in Section 1.1 or elsewhere in this Loan Agreement shall mean the singular thereof when the
singular form of such term is used herein or therein.

 

(c)The
words “hereof,” “herein,” “hereunder” and similar terms when used in this Loan Agreement shall
refer to this Loan Agreement as a whole and not to any particular provision of this Loan Agreement, and article, section, subsection,
schedule and exhibit references herein are references to articles, sections, subsections, schedules and exhibits to this Loan
Agreement unless otherwise specified.

 

Section
1.3Other Terms. All accounting terms not specifically defined herein shall be construed in accordance with GAAP. All
terms used in Article 9 of the UCC as in effect in the applicable jurisdiction, and not specifically defined herein, are used
herein as defined in such Article 9.

 

GWG DLP Funding IV, LLC Loan and Security
Agreement

    	 	Page 1 of 64	 

     

    

 

Section
1.4Computation of Time Periods. Unless otherwise stated in this Loan Agreement, in the computation of a period of time
from a specified date to a later specified date, the word “from” means “from and including” and the words
“to” and “until” each means “to but excluding.”

 

ARTICLE
II

THE LENDERS’ COMMITMENTS, BORROWING PROCEDURES,

SECURITY INTEREST AND LENDER NOTES

 

Section
2.1Lenders’ Commitments. (a) On the terms and subject to the conditions set forth in this Loan Agreement, the
Lenders shall make an Advance to the Borrower in the amount up to Seventy One Million Two Hundred Fifty Thousand Dollars ($71,250,000)
(the “First Initial Advance”) and a subsequent Advance in the amount of up to One Hundred One Million Fifty
Thousand Dollars ($101,050,000) (the “Second Initial Advance” and together with the First Initial Advance,
the “Initial Advance”), in each case, for the purposes set forth in Section 2.8(a); provided,
however that (i) subject to Section 2.1(d) of this Loan Agreement, the aggregate principal amount of all Advances
from time to time outstanding under this Loan Agreement (including any Protective Advances) shall not exceed the Borrowing Base
and (ii) no Lender shall be obligated to make any Advance to the Borrower to the extent that the aggregate outstanding amount
of such Advances made by such Lender hereunder exceeds such Lender’s Commitment as set forth in Schedule 2.1(a),
as the same is amended (or deemed amended) from time to time by Assignment and Assumption Agreements executed as provided in Section
13.4 of this Loan Agreement, nor shall any Lender be obligated to make any Advance required to be made by any other Lender.
On the Closing Date or a subsequent date agreed to by the Borrower and the Required Lenders, so long as the Borrower has requested
the same pursuant to a Borrowing Request delivered to the Administrative Agent as set forth below and subject to the conditions
set forth in this Loan Agreement, the Lenders shall make the First Initial Advance to the Borrower. After the Closing Date, so
long as the Borrower has requested the same pursuant to a Borrowing Request delivered to the Administrative Agent as set forth
below and subject to the conditions set forth in this Loan Agreement, the Lenders shall make the Second Initial Advance to the
Borrower.

 

(b)So
long as the Borrower has requested the same pursuant to a Borrowing Request delivered to the Administrative Agent as set forth
below, and subject to the conditions set forth in this Loan Agreement, the Lenders shall make Ongoing Maintenance Advances to
the Borrower; provided, however, that subject to Section 2.1(d) of this Loan Agreement, the aggregate principal
amount of all Advances outstanding under this Loan Agreement (including any Protective Advances) shall not exceed the Borrowing
Base.

 

(c)So
long as the Borrower has requested the same pursuant to a Borrowing Request delivered to the Administrative Agent as set forth
below and subject to the conditions set forth in this Loan Agreement, the Lenders may make Additional Policy Advances to the Borrower
in amounts determined by the Lenders in their sole and absolute discretion.

 

GWG DLP Funding IV, LLC Loan and Security
Agreement 

    	 	Page 2 of 64	 

     

    

 

(d)Without
regard to the Borrowing Base and without any Borrowing Request, the Lenders shall be entitled to make Advances on behalf of the
Borrower as the Lenders determine in their sole and absolute discretion are necessary in order to make premium payments and to
pay other costs and expenses to ensure that one or more Pledged Policies selected by the Lenders in their sole and absolute discretion,
other than Policies that are sold as contemplated by Section 2.7 of this Loan Agreement, remain in full force and effect,
as determined by the Lenders in their sole and absolute discretion (such Advances, together with any Advances made from time to
time by the Lenders hereunder to pay any costs and expenses in defending the Collateral against any lawsuits or in any other proceedings
(including attorneys’ fees) and any Advances made from time to time by the Lenders hereunder after and during the continuance
of an Unmatured Event of Default or an Event of Default shall collectively be referred to herein as “Protective
Advances”). Notwithstanding anything herein to the contrary, with respect to any Protective Advance, such Protective
Advance may be made by the Lenders even if such Protective Advance, when taken together with the outstanding balance of all previous
Advances, would cause the aggregate outstanding balance of the Advances to exceed the Borrowing Base as of the date of such Protective
Advance. Furthermore, notwithstanding anything herein to the contrary, it is understood that with respect to the making of each
of the First Initial Advance and the Second Initial Advance, the aggregate principal amount of all Advances outstanding under
this Loan Agreement after the making of such Advance (including any Protective Advances) may exceed the Borrowing Base so long
as all other conditions precedent to the making of such Advance are satisfied.

 

Section
2.2Borrowing Procedures.

 

(a)The
Borrower shall request each of the First Initial Advance and the Second Initial Advance hereunder by giving notice to the Administrative
Agent of the proposed borrowing. Such notice (herein called a “Borrowing Request”) shall be in the form of
Exhibit A and with respect to the Borrowing Request related to the First Initial Advance, is permitted to have been prepared and
delivered by the Borrower up to five (5) Business Days before the date of execution of this Loan Agreement such that the related
Proposed First Initial Advance Notice and First Initial Advance Acceptance may be executed concurrently with this Loan Agreement.
The Borrowing Request for each of the First Initial Advance and the Second Initial Advance shall (i) specify the date and aggregate
amount of the proposed First Initial Advance or Second Initial Advance, as applicable, (ii) identify the Subject Policies proposed
to be pledged hereunder in connection with such Advance and confirm that the related Collateral Packages have been uploaded to
the FTP Site, (iii) contain a statement of the amount of payments anticipated to be made to the equity holders of the Borrower
with the proceeds of such Advance and the amount of such Advance that will be deposited into the Reserve Account and (iv) attach
a Borrowing Base Certificate, signed by an officer of the Borrower.

 

(b)The
Borrower may request an Ongoing Maintenance Advance hereunder by delivering a fully executed and completed Borrowing Request to
the Administrative Agent. Each Borrowing Request for a proposed Ongoing Maintenance Advance shall (i) specify the date and aggregate
amount of the proposed Ongoing Maintenance Advance and (ii) attach a Borrowing Base Certificate, signed by an officer of the Borrower.
The Borrowing Request for the initial Ongoing Maintenance Advance is permitted to have been prepared and delivered by the Borrower
up to five (5) Business Days before the date of execution of this Loan Agreement such that the related Subsequent Advance Acceptance
may be executed concurrently with this Loan Agreement.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 3 of 64	 

     

    

 

(c)In
the event the Borrower desires an Additional Policy Advance, the Borrower shall notify the Administrative Agent of such desire
in writing, which written notice shall identify the Additional Policies proposed to be pledged in connection with the making of
such Additional Policy Advance and be accompanied by full and complete Collateral Packages for such Additional Policies. The Borrower
shall not deliver any Borrowing Request with respect to an Additional Policy Advance unless and until (i) it has wired the related
Expense Deposit to the Administrative Agent’s Account following confirmation of the amount thereof and (ii) it has received
written notice from the Administrative Agent confirming that the Administrative Agent and the Lenders have completed their due
diligence with respect to the Additional Policies proposed to be pledged hereunder in connection with the making of such Additional
Policy Advance, and indicating which Additional Policies, if any, will be accepted as Collateral hereunder and the estimated amounts
that the Lenders will be willing to fund under this Loan Agreement with respect to such Additional Policies. After the Borrower’s
wiring of the related Expense Deposit to the Administrative Agent’s Account and the Borrower’s receipt of such written
notice from the Administrative Agent, the Borrower may request an Additional Policy Advance hereunder with respect to such Additional
Policies by delivering a fully executed and completed Borrowing Request to the Administrative Agent. Each Borrowing Request related
to a proposed Additional Policy Advance shall (i) specify the date and aggregate amount of the proposed Additional Policy Advance,
(ii) identify the Additional Policies proposed to be pledged hereunder in connection with such Additional Policy Advance and confirm
that the related Collateral Packages have been uploaded to the FTP Site, (iii) contain a statement of the amount of payments anticipated
to be made to the equity holders of the Borrower with the proceeds of such Additional Policy Advance and the amount of such Advance
that will be deposited into the Reserve Account and (iv) attach a Borrowing Base Certificate, signed by an officer of the Borrower.
The Lenders shall be under no obligation to make any Additional Policy Advance. The Lenders may make Additional Policy Advances
in their sole and absolute discretion and may require additional documentation (including opinions of counsel) and the satisfaction
of conditions, including the payment of additional fees, all as determined by the Lenders in their sole and absolute discretion.

 

Section
2.3Funding. (a) No later than five (5) Business Days following the Administrative Agent’s receipt of a Borrowing
Request for the First Initial Advance, the Lenders shall, in their sole and absolute discretion and acting unanimously, determine
whether to approve the Subject Policies, and the Administrative Agent shall notify the Borrower of (i) the determination of the
amount, if any, the Lenders will fund (a “Proposed First Initial Advance”, and such notice of the Proposed
First Initial Advance, a “Proposed First Initial Advance Notice”), (ii) the amount of the Closing Fee and (iii)
the amount of the payments to the equity holders of the Borrower that the Lenders have approved with respect to such Proposed
First Initial Advance; provided that such determination shall be in the Lenders’ sole and absolute discretion. If the Lenders
are willing to make such Proposed First Initial Advance and the Borrower determines to accept such Proposed First Initial Advance,
on or before the third (3rd) Business Day after the delivery of the Proposed First Initial Advance Notice by the Administrative
Agent, the Borrower shall notify the Administrative Agent that the Borrower accepts the Proposed First Initial Advance (a “First
Initial Advance Acceptance”); for avoidance of doubt, if the Borrower does not deliver a First Initial Advance Acceptance
by 5:00 pm, New York time on the third (3rd) Business Day following the delivery of the Proposed First Initial Advance Notice,
then the Borrower shall be deemed to have rejected such Proposed First Initial Advance. On the first (1st) Business Day following
the Administrative Agent’s receipt of the First Initial Advance Acceptance, and subject to the complete satisfaction of
the conditions precedent set forth in Article VII with respect to the First Initial Advance and the limitations set forth
in Section 2.1, the Lenders shall distribute funds in the amount set forth in the Proposed First Initial Advance Notice
in accordance with Schedule 2.8.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 4 of 64	 

     

    

 

(b)No
later than five (5) Business Days following the Administrative Agent’s receipt of a Borrowing Request for the Second Initial
Advance, the Administrative Agent shall notify the Borrower of the resulting Second Initial Advance to be funded by the Lenders
on the related Advance Date (such notice, the “Second Initial Advance Acceptance”) subject to the immediately
following sentence. Subject to the complete satisfaction of the conditions precedent set forth in Article VII with respect
to the Second Initial Advance and the limitations set forth in Section 2.1, the Lenders shall distribute funds in the amount
set forth in the Second Initial Advance Acceptance in accordance with Schedule 2.8. If the Second Initial Advance is not made
due to the failure to satisfy any of the conditions or limitations set forth in the immediately preceding sentence, then the Borrower
may submit a subsequent Borrowing Request in respect of the Second Initial Advance, which Borrowing Request shall be delivered
by the Borrower to the Administrative Agent no later than ten (10) Business Days after the Administrative Agent delivered the
Second Initial Advance Acceptance to the Borrower.

 

(c)No
later than five (5) Business Days following the Administrative Agent’s receipt of a Borrowing Request for an Ongoing Maintenance
Advance, the Administrative Agent shall notify the Borrower of the resulting total Ongoing Maintenance Advance to be funded by
the Lenders on the related Subsequent Advance Date (such notice, the related “Subsequent Advance Acceptance”)
subject to the immediately following sentence. Subject to the complete satisfaction of the conditions precedent set forth in Article
VII with respect to such Ongoing Maintenance Advance and the limitations set forth in Section 2.1, the Lenders shall
distribute funds in the amount set forth in such Subsequent Advance Acceptance to the Payment Account to be disbursed by the Securities
Intermediary in accordance with the terms of the Account Control Agreement.

 

(d)No
later than five (5) Business Days following the Administrative Agent’s receipt of a Borrowing Request for an Additional
Policy Advance, the Lenders shall, in their sole and absolute discretion and acting unanimously, determine whether to approve
the Additional Policies, and the Administrative Agent shall notify the Borrower of the determination of the amount, if any, the
Lenders will fund (a “Proposed Additional Policy Advance”, and such notice of the Proposed Additional Policy
Advance, a “Proposed Additional Policy Advance Notice”); provided that such determination shall be in the Lenders’
sole and absolute discretion. If the Lenders are willing to make such Proposed Additional Policy Advance and the Borrower determines
to accept such Proposed Additional Policy Advance, on or before the third (3rd) Business Day after the delivery of the Proposed
Additional Policy Advance Notice by the Administrative Agent, the Borrower shall notify the Administrative Agent that the Borrower
accepts the Proposed Additional Policy Advance (an “Additional Policy Advance Acceptance”) which notice shall
specify the agreed Additional Policy Advance Amount; for avoidance of doubt, if the Borrower does not deliver an Additional Policy
Advance Acceptance by 5:00 pm, New York time on the third (3rd) Business Day following the delivery of the Proposed Additional
Policy Advance Notice, then the Borrower shall be deemed to have rejected such Proposed Additional Policy Advance. On the third
(3rd) Business Day following the Administrative Agent’s receipt of the Additional Policy Advance Acceptance, and subject
to the complete satisfaction of the conditions precedent set forth in Article VII with respect to such Additional Policy
Advance and the limitations set forth in Section 2.1, the Lenders shall distribute funds in the amount set forth in the
Proposed Additional Policy Advance Notice to the Payment Account to be disbursed by the Securities Intermediary in accordance
with the terms of the Account Control Agreement.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 5 of 64	 

     

    

 

(e)The
Borrower shall not deliver more than one (1) Borrowing Request for an Ongoing Maintenance Advance in any calendar quarter and
shall not deliver more than two (2) Borrowing Requests for any type of Advance in any calendar quarter. In addition, the
Borrower shall not deliver any Borrowing Request if the Borrower has previously delivered a Borrowing Request to the Administrative
Agent in respect of an Additional Policy Advance and the Administrative Agent has not yet delivered the related Proposed Additional
Policy Advance Notice, the Borrower has not yet delivered the related Additional Policy Advance Acceptance, the Borrower has not
yet rejected the related Proposed Additional Policy Advance or the Borrower has delivered the related Additional Policy Advance
Acceptance and the related Subsequent Advance Date has not yet occurred, in each case, in accordance with Section 2.3(d).
The Borrower shall not deliver a Borrowing Request for an Ongoing Maintenance Advance or an Additional Policy Advance unless such
delivery is made on or after the six (6) month anniversary of the Closing Date and on or prior to the five (5) year anniversary
of the Closing Date.

 

Section
2.4Representation and Warranty. Each Borrowing Request pursuant to Section 2.2 and each acceptance of an Advance
by the Borrower shall automatically constitute a representation and warranty by the Borrower to the Administrative Agent and each
Lender that on the date such Borrowing Request is delivered to the Administrative Agent and on the related Advance Date (a) the
representations and warranties contained in Article VIII will be true and correct in all respects as of such Borrowing Request
date and as of such Advance Date as though made on such dates, except to the extent any such representation or warranty relates
to a specific date, in which case, such representation or warranty will be true and correct in all respects as of such date as
though made on such date, (b) all of the conditions precedent to the making of an Advance contained in Article VII have
been satisfied or will have been satisfied as of such Advance Date and (c) no Event of Default or Unmatured Event of Default has
occurred and is continuing or will result from the making of such Advance.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 6 of 64	 

     

    

 

Section
2.5Lender Notes. With respect to each Lender, the Advances made by such Lender to the Borrower shall be evidenced by
a single promissory note executed by the Borrower (as the same may be amended, modified, extended or replaced from time to time,
a “Lender Note” and collectively, the “Lender Notes”) substantially in the form of Exhibit
B hereto, with appropriate insertions to reflect Advances (or portion thereof) actually funded by such Lender, the related
applicable interest rates thereof and related repayments and appropriate revisions to reflect assignments effected in accordance
with Section 13.4 of this Loan Agreement, payable to such Lender. For the avoidance of doubt, any Protective Advances made
by a Lender shall not be required to be evidenced in its Lender Note and the Administrative Agent’s records shall constitute
conclusive evidence that such Protective Advances have been made. The Borrower hereby irrevocably authorizes each Lender to make
(or cause to be made) appropriate notations on the grid attached to its Lender Note (or on any continuation of such grid) or at
such Lender’s option, in the records of such Lender, which notations, if made, shall evidence, inter alia, the date of,
the outstanding principal of, and the interest rates and Interest Periods applicable to the Advances made by such Lender and related
repayments and appropriate revisions to reflect assignments effected in accordance with Section 13.4 of this Loan Agreement.
Such notations and records (absent manifest error) shall be conclusive evidence of the subject matter thereof; provided, however,
that the failure to make any such notations or maintain any such records shall not limit or otherwise affect any Obligations of
the Borrower. The Borrower hereby agrees to promptly execute and deliver a new Lender Note upon any assignment to a new Lender
effected in accordance with Section 13.4 of this Loan Agreement, and each Lender making an assignment of all or any portion
of its Lender Note will either (i) if such assignment is an assignment of its entire Lender Note, deliver its Lender Note to the
Borrower for termination and cancellation effective upon Borrower’s execution and delivery of such new Lender Note to the
assignee thereof or (ii) if such assignment is an assignment in part of such Lender Note, deliver its Lender Note to the Borrower
for termination and cancellation effective upon Borrower’s execution and delivery of a new Lender Note to the assignee thereof
and a new Lender Note to such Lender.

 

Section
2.6Security Interest.

 

(a)To
secure the timely repayment of the principal of, and interest on, the Advances, and all other Obligations of the Borrower to any
Secured Party, and the prompt performance when due of all covenants of the Borrower hereunder and under any other Transaction
Document, whether now or hereafter existing or arising, due or to become due, direct or indirect, the Borrower hereby pledges
and grants to the Administrative Agent, for the benefit of the Secured Parties, a continuing, first priority security interest
in, and assignment of, all of the Borrower’s rights, titles and interests in, to and under all of the following, whether
now or hereafter owned, existing or arising: all assets of the Borrower, including but not limited to all right, title and interest
of the Borrower in the Pledged Policies and proceeds thereof; all accounts receivable, notes receivable, claims receivable and
related proceeds including but not limited to, cash, loans, securities, and accounts; contract rights; the contracts with and
the rights to and against the Securities Intermediary, in its capacity as owner of record of the Pledged Policies, and the Custodian;
the Collection Account, the Reserve Account, the Payment Account, the Policy Account and any other account of the Borrower (excluding
only the Borrower Account); reserve accounts; escrow agreements and related books and records; the rights under any purchase agreements
relating to such Policies; all data, documents and instruments contained in the Collateral Packages; and such other assets, tangible
or intangible, real or personal of the Borrower. All of the rights and assets described in the previous sentence are herein referred
to collectively as “Collateral”; provided, however, that this definition of “Collateral”
does not limit any other collateral that may be pledged to secure the Advances under any other Transaction Document.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 7 of 64	 

     

    

 

(b)The
Borrower shall file such financing statements, and execute and deliver such agreements, certificates and documents, and take such
other actions, as the Administrative Agent requests, in each case, in order to perfect, evidence or protect the security interest
granted pursuant to Section 2.6(a), including without limitation delivering a collateral assignment in respect of each
Pledged Policy subject to this Loan Agreement, naming the Administrative Agent, on behalf of the Lenders, as the collateral assignee,
filed with, and acknowledged to have been filed by, the applicable Issuing Insurance Company; provided, that the foregoing collateral
assignment shall not apply to the portion of the face amount that is retained by a third party under any Retained Death Benefit
Policy. On or prior to each Advance Date, the Borrower shall deliver or cause to be delivered completed but unsigned Change Forms
for the Subject Policies to the Securities Intermediary. The Borrower shall cause the Securities Intermediary to execute all such
Change Forms in blank to be held by the Securities Intermediary. If an Issuing Insurance Company updates its Change Forms, at
the request of the Administrative Agent, the Borrower shall deliver or cause to be delivered completed but unsigned updated Change
Forms for the related Pledged Policies within five (5) Business Days of such request. The Borrower shall cause the Securities
Intermediary to execute such Change Forms in blank to be held by the Securities Intermediary. The Borrower grants to the Administrative
Agent, as its irrevocable attorney-in-fact and otherwise, the right, in the Administrative Agent’s sole and absolute discretion,
following the occurrence of an Event of Default, to complete or direct the Securities Intermediary to complete and send any and
all Change Forms previously delivered to it by or on behalf of the Borrower or otherwise obtained by the Administrative Agent,
to the applicable Issuing Insurance Companies. The Borrower hereby acknowledges that the foregoing grant has been coupled with
an interest and is irrevocable. The Borrower hereby authorizes the Administrative Agent to file such financing statements and
other documentation as the Administrative Agent determines are necessary or advisable to perfect such security interest without
the signature of the Borrower, provided however, notwithstanding any other provision of any Transaction Document,
the Administrative Agent shall have no duty or obligation to file such financing statements, continuation statements or amendments
thereto. The Borrower hereby appoints the Administrative Agent as the Borrower’s irrevocable attorney-in-fact, with full
power and authority to take any other action to sign or endorse the Borrower’s name on any Collateral, and to enforce or
collect any of the Collateral, upon the occurrence and during the continuance of an Event of Default. The Borrower hereby acknowledges
that the foregoing appointment of the Administrative Agent as the Borrower’s irrevocable attorney-in-fact has been coupled
with an interest and is irrevocable. The Borrower hereby ratifies and approves all acts of such attorney-in-fact, and agrees that
the Administrative Agent will not be liable for any act or omission with respect thereto, except to the extent that such act or
omission constitutes gross negligence, fraud or willful misconduct on the part of the Administrative Agent.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 8 of 64	 

     

    

 

(c)Upon
the receipt of the related Net Proceeds by the Lenders after the sale of a Pledged Policy pursuant to Section 2.7, the
security interest of the Administrative Agent in such Pledged Policy for the benefit of the Secured Parties shall be released.
Upon the indefeasible repayment in full of all of the Advances then outstanding and all other Obligations and termination of all
Commitments and this Loan Agreement, (i) the security interest of the Administrative Agent in the Collateral for the benefit of
the Secured Parties shall be released and (ii) the Administrative Agent shall file, promptly upon written request, such releases
or assignments, as applicable, and to take such other actions as the Borrower shall reasonably request in writing in order to
evidence any such release.

 

Section
2.7Sale of Collateral.

 

Except
as set forth in the second paragraph of this Section 2.7, the Borrower may not sell any Collateral without the prior written consent
of the Required Lenders (such consent shall not be unreasonably withheld or delayed); provided that such sale is made on arms-length
terms, at fair market value for cash (in U.S. dollars) and is not made to an Affiliate of the Borrower (a “Permissible
Sale”). The Borrower shall apply the Net Proceeds from a Permissible Sale to prepay outstanding Advances in accordance
with Section 4.1(b). The Borrower shall provide written notice of any such sale to the Administrative Agent at least seven (7)
Business Days prior to any such sale and shall certify to the Administrative Agent that such sale constitutes a Permissible Sale.
The Borrower agrees that it would not be unreasonable for the Required Lenders to withhold their consent to any such sale if immediately
prior to such sale there exists, or immediately after such sale there would exist, an Event of Default or an Unmatured Event of
Default.

 

Notwithstanding
the immediately preceding paragraph, if the Collateral consists of one-hundred (100) or fewer Pledged Policies insuring the lives
of one-hundred (100) or fewer distinct Insureds, then, without the prior written consent of the Required Lenders, the Borrower
may sell one or more of the Pledged Policies to any Person, including, without limitation, an Affiliate of the Borrower, so long
as the Net Proceeds from any such sale are equal to or greater than the outstanding principal balance of all Advances plus accrued
but unpaid interest thereon, plus the Yield Maintenance Fee applicable thereto, plus all other Obligations owing by the Borrower,
and the Commitments and this Loan Agreement will be terminated after the application of such Net Proceeds. The Borrower shall
apply the Net Proceeds from any such sale in accordance with Section 4.1(b). The Borrower shall provide written notice of any
such sale to the Administrative Agent at least seven (7) Business Days prior to any such sale.

 

Section
2.8Permitted Purposes. (a) The Borrower shall not use the proceeds of any Advance made hereunder except for the following
purposes:

 

(i)with
respect to the First Initial Advance and the Second Initial Advance, (a) to pay the purchase price for the Subject Policies to
the Parent pursuant to the Purchase Agreement, a portion of which funds, with respect to the First Initial Advance, shall be immediately
used to repay indebtedness outstanding under that certain Second Amended and Restated Credit and Security Agreement dated May
11, 2015, among Parent, GWG DLP Funding II, LLC, GWG Holdings, Inc., Autobahn Funding Company LLC, DZ Bank AG Deutsche Zentral-Genossenschaftsbank;
(b) to pay working capital needs and expenses of the Borrower; (c) to pay any transaction costs related to such Advance
and, with respect to the First Initial Advance, to pay closing fees payable to the Lenders and the Administrative Agent; (d) with
respect to the Second Initial Advance, to make payments to the sole equity holder of the Borrower (which such sole equity holder
may distribute to its equity holders) in an amount not to exceed $84,800,000, (e) with respect to the Second Initial Advance,
to fund the Reserve Account, (f) with respect to the Second Initial Advance, to pay Ongoing Maintenance Costs and (g) to
make any other payments or distributions, as approved in writing by the Required Lenders in their sole and absolute discretion;
and

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 9 of 64	 

     

    

 

(ii)with
respect to an Ongoing Maintenance Advance, (a) to pay Ongoing Maintenance Costs and/or (b) to make any other payments or distributions,
as approved in writing by the Required Lenders in their sole and absolute discretion; and

 

(iii)with
respect to an Additional Policy Advance, to make any payments or distributions, as approved in writing by the Required Lenders
in their sole and absolute discretion.

 

(b)For
the avoidance of doubt, all proceeds of Advances shall be deposited by the Lenders (i) in accordance with Schedule 2.8 in respect
of the Initial Advance, as such Schedule 2.8 may be amended from time to time, (ii) for any Additional Policy Advance, as directed
by the Lenders in their sole and absolute discretion and (iii) for any Ongoing Maintenance Advance, into the Payment Account.
The Borrower shall cause any amounts on deposit in the Payment Account to be distributed by the Securities Intermediary in accordance
with the terms of the Account Control Agreement, which amounts shall be used for the purposes set forth in Section 2.8(a) and
as specified in the related Borrowing Request.

 

Section
2.9Closing Fee. With respect to the First Initial Advance made hereunder, the Borrower shall pay to the Administrative
Agent the Closing Fee. The Closing Fee shall be fully earned and due and payable on the initial Advance Date and may be paid from
the proceeds of the First Initial Advance. With respect to Additional Policy Advances, if any, the Borrower shall pay such fees
and at such times as the Lenders and the Borrower shall agree. In the event that the Borrower requests an Advance hereunder such
that after giving effect to such Advance, the principal amount of all Advances outstanding under this Loan Agreement would exceed
the Borrowing Base, which request may be granted or withheld in the Lenders' sole and absolute discretion, and such Advance is
made on the related Advance Date, the Borrower shall pay to the Administrative Agent a fee in an amount equal to the product of
(i) such excess and (ii) two percent (2.00%). Each such fee shall be fully earned and due and payable on the related Advance Date
and may be paid from the proceeds of such Advance.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 10 of 64	 

     

    

 

ARTICLE
III

INTEREST; INTEREST PERIODS; FEES, ETC.

 

Section
3.1Interest Rates. The Borrower hereby promises to pay interest on the unpaid principal amount of each Advance for
the period commencing on the date such Advance is made until such Advance is paid in full, at a rate per annum equal
to the sum of (i) (A) LIBOR or, if LIBOR is unavailable, (B) the Base Rate, plus (ii) the Applicable Margin; provided however
that if an Event of Default has occurred and is continuing, each Advance shall bear interest at a rate per annum
equal to the Default Rate. The date of determination used to calculate LIBOR shall be the Closing Date and thereafter each
Rate Calculation Date, which interest shall be in effect for the period of time commencing on such Rate Calculation Date (or the
Closing Date with respect to the initial Interest Period) until (but not including) the immediately succeeding Rate Calculation
Date. No provision of this Loan Agreement shall require the payment or permit the collection of interest in excess of the maximum
permitted by Applicable Law.

 

Section
3.2Interest Payment Dates. Interest accrued on each Advance shall be due and payable, without duplication:

 

(a)on
each Interest Payment Date;

 

(b)on
the date of any prepayment, in whole or in part, of principal of outstanding Advances;

 

(c)on
Advances accelerated pursuant to Section 10.2, immediately upon such acceleration; and

 

(d)on
the Maturity Date.

 

Section
3.3Fees. The Borrower shall pay all Fees to the Persons entitled thereto.

 

Section
3.4Computation of Interest and Fees. All interest and fees shall be computed on the basis of the actual number of days
(including the first day but excluding the last day) occurring during the period for which such interest or fee is payable over
a year comprised of 360 days.

 

ARTICLE
IV

PAYMENTS; PREPAYMENTS

 

Section
4.1Repayments and Prepayments. The Borrower shall repay in full the unpaid principal amount of each Advance on the
Maturity Date. Prior thereto, the Borrower:

 

(a)may
voluntarily prepay all or any portion of the aggregate outstanding Advances, either in whole or in part, together with the related
Yield Maintenance Fee, from funds available for distribution to the Borrower pursuant to clause “Eleventh”
of Section 5.2(b) and/or from funds available to the Borrower from any capital contribution or other source of funding
obtained by the Borrower that is not expressly prohibited by this Loan Agreement; provided, however, that no such
prepayment shall constitute the payment of Required Amortization;

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 11 of 64	 

     

    

 

(b)shall
apply the Net Proceeds of any sales made pursuant to Section 2.7 to repay Advances (in the inverse order of maturity) by
depositing such Net Proceeds into the Administrative Agent’s Account; provided, however, that no such prepayment
shall constitute the payment of Required Amortization; provided, further, that such Net Proceeds shall first be
applied to the payment of any applicable Yield Maintenance Fee, then interest accrued on such Advances, and then the repayment
of Advances (in the inverse order of maturity).

 

(c)shall,
immediately upon any acceleration of the Maturity Date pursuant to Section 10.2, repay all such Advances and all other
Obligations (including, without limitation, the Yield Maintenance Fee) within one (1) Business Day of the Administrative Agent’s
delivery of notice of such acceleration to the Borrower ;

 

(d)shall,
within thirty 30 days after (i) the number of Pledged Policies is less than or equal to fifty (50), or (ii) the cumulative face
amount of the Pledged Policies is less than or equal to $125,000,000, repay all the Advances and all other Obligations (including,
without limitation, the Yield Maintenance Fee); and

 

(e)shall,
on each Distribution Date, repay the Advances from Available Amounts in accordance with the Priority of Payments.

 

Section
4.2Yield Maintenance Fee. If the Borrower prepays or repays an Advance in accordance with Section 4.1 or a Reduction
Action occurs in respect of an Advance, whether before or after (i) the occurrence of an Event of Default or (ii) the occurrence
of any Event of Bankruptcy, and notwithstanding any acceleration (for any reason) of the Obligations, the Borrower shall pay the
Yield Maintenance Fee with respect to such prepayment, repayment or Reduction Action, as applicable, and such Yield Maintenance
Fee shall be due and payable. The Yield Maintenance Fee shall also be payable with respect to any prepayments or distributions
made by the Borrower pursuant to Section 5.2(c). For avoidance of doubt, except as set forth in Section 4.1(a), no Yield
Maintenance Fee shall be payable with respect to any payments or distributions made by or on behalf of the Borrower pursuant to
Section 5.2(b). Notwithstanding anything herein to the contrary, the Yield Maintenance Fee shall be payable notwithstanding
acceleration of the Obligations or the Maturity Date for any reason, including, without limitation, acceleration in accordance
with Section 10.2 (including, without limitation, as a result of the occurrence of an Event of Bankruptcy).

 

Section
4.3Making of Payments. All payments of principal of, or interest on, the Advances, and all amounts to be deposited
by the Borrower, shall be made by the Borrower no later than 1:00 p.m. (New York City time), on the day when due in Dollars in
same day funds to the account designated in writing by the Administrative Agent to the Borrower (the “Administrative
Agent’s Account”) or, with respect to other amounts payable to any Lender or the Administrative Agent, directly
thereto in accordance with the directions provided by the Lender or the Administrative Agent, as applicable. Funds received by
any Person after 1:00 p.m. (New York City time), on the date when due will be deemed to have been received by such Person on the
next following Business Day.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 12 of 64	 

     

    

 

Section
4.4Due Date Extension. If any payment of principal or interest with respect to any Advance falls due on a day which
is not a Business Day, then such due date shall be extended to the next following Business Day, and additional interest shall
accrue at the applicable interest rate and be payable for the period of such extension.

 

ARTICLE
V

ACCOUNTS; DISTRIBUTION OF COLLECTIONS

 

Section
5.1Accounts.

 

(a)Collection
Account. The Borrower has established and shall maintain, in the name of the Borrower, an Eligible Account bearing a designation
clearly indicating that the funds deposited therein are held for the benefit of the Administrative Agent, on behalf of the Secured
Parties (the “Collection Account”), that at all times shall be subject to the Account Control Agreement.

 

(b)Reserve
Account. The Borrower has established and shall maintain, in the name of the Borrower, an Eligible Account bearing a designation
clearly indicating that the funds on deposit therein are held for the benefit of the Administrative Agent, on behalf of the Secured
Parties (the “Reserve Account”), that at all times shall be subject to the Account Control Agreement. Subject
to the terms of the Account Control Agreement, in the event the Calculation Date Report and the related Payment Instructions with
respect to any Calculation Date shall indicate that the then Available Amount with respect to the related Distribution Date is
insufficient to make the payments in clauses “First”, “Third”, “Fourth”,
“Fifth”, “Sixth” and “Seventh” of the Priority of Payments (such deficiency
being “Deficiency Claim Amount”), then on the Business Day immediately prior to such Distribution Date the
Administrative Agent shall instruct the Securities Intermediary to withdraw from the Reserve Account an amount equal to the lesser
of (i) the Deficiency Claim Amount for such Distribution Date and (ii) the amount on deposit in the Reserve Account, and deposit
such amount in the Collection Account. On or prior to the Closing Date, the Borrower shall deposit, or cause to be deposited,
into the Reserve Account an amount equal to Eleven Million Two Hundred Fifty Thousand Dollars ($11,250,000). On the Advance Date
related to the Second Initial Advance, the Borrower shall deposit an amount equal to Sixteen Million Two Hundred Fifty Thousand
Dollars ($16,250,000) into the Reserve Account from the proceeds of such Advance. On the First Distribution Date after the one
(1) year anniversary of the Closing Date and on each Distribution Date thereafter (after giving effect to the distributions to
be made on such date), (i) if the amount on deposit in the Reserve Account is in excess of the Reserve Account Required Amount,
such excess funds shall be deposited into the Collection Account to be distributed in accordance with Section 5.2(b) or
Section 5.2(c), as applicable, on the immediately following Distribution Date at the written direction of the Borrower,
unless an Event of Default has occurred and is continuing, otherwise, at the written direction of the Administrative Agent and
(ii) if the amount on deposit in the Reserve Account is less than the amount necessary to pay the projected Expenses and Debt
Service in respect of all the Pledged Policies during the following six (6) month period, as determined by the Administrative
Agent in its reasonable discretion, the Borrower shall immediately deposit additional funds into the Reserve Account, until such
time as the amount on deposit therein equals the Reserve Account Required Amount, as determined by the Administrative Agent in
its reasonable discretion. Upon the repayment in full of all Advances and the termination of all Commitments, funds on deposit
in the Reserve Account shall be transferred to the Collection Account and distributed pursuant to Section 5.2(b).

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 13 of 64	 

     

    

 

(c)[Reserved.]

 

(d)Borrower
Account. On or prior to the date hereof, the Borrower shall establish and maintain a segregated Eligible Account with an Eligible
Institution in the name of the Borrower (the “Borrower Account”). The Borrower shall be entitled to cause the
withdrawal of amounts on deposit in the Borrower Account for any purpose, including, without limitation, the payment of Premiums
or Expenses.

 

(e)Payment
Account. The Borrower has established and shall maintain, in the name of the Borrower, an Eligible Account bearing a designation
clearly indicating that the funds deposited therein are held for the benefit of the Administrative Agent, on behalf of the Secured
Parties (the “Payment Account”), that at all times shall be subject to the Account Control Agreement. All proceeds
of Advances shall be deposited by the Lenders into the Payment Account or another account as set forth on Schedule 2.8. The Borrower
shall cause any amounts on deposit in the Payment Account to be distributed by the Securities Intermediary in accordance with
the terms of the Account Control Agreement, which amounts shall be used for the purposes set forth in Section 2.8 and as
specified in the related Borrowing Request. On or prior to the Closing Date, the Borrower shall deposit an amount equal to $25,018,088.26
into the Payment Account and an amount equal to $11,250,000 of such deposit shall be transferred into the Reserve Account on or
prior to the Closing Date (it being understood that the remainder of such deposit shall be distributed to the Parent on the Closing
Date and immediately used to repay indebtedness outstanding under that certain Second Amended and Restated Credit and Security
Agreement dated May 11, 2015, among Parent, GWG DLP Funding II, LLC, GWG Holdings, Inc., Autobahn Funding Company LLC, DZ Bank
AG Deutsche Zentral-Genossenschaftsbank).

 

(f)Administrative
Agent Action. The Administrative Agent may, at any time after an Event of Default has occurred and is continuing, give written
notice to the Securities Intermediary and to the Borrower, of the occurrence of such event and specifying whether the Administrative
Agent is exercising its rights and remedies in relation thereto in accordance with this Loan Agreement and the Account Control
Agreement, and will do any or all of the following: (i) exercise exclusive dominion and control over the funds deposited in the
Accounts, (ii) have amounts that are sent to the Accounts redirected pursuant to its instructions, and (iii) take any or all other
actions the Administrative Agent is permitted to take under this Loan Agreement and the Account Control Agreement for the benefit
of the Secured Parties. If at any time, any Account shall cease to be an Eligible Account, the Borrower shall as promptly as reasonably
practicable (but in no event more than twenty (20) Business Days) establish a replacement Eligible Account.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 14 of 64	 

     

    

 

(g)Collections
Held In Trust. If at any time the Borrower, the Servicer, the Securities Intermediary or any of their Affiliates, as the case
may be, shall receive any Collections or other proceeds of any Collateral other than through payment into the Collection Account,
the Borrower shall or shall cause the Servicer, the Securities Intermediary or such Affiliate to, promptly (but in any event within
two (2) Business Days of receipt thereof) remit or cause to be remitted all such Collections or other proceeds to the Collection
Account, unless such Collections or other proceeds constitute sale proceeds, in which case, such Collections or other proceeds
shall be remitted to the Administrative Agent’s Account pursuant to Section 4.1(b). All Collections received by the
Borrower, the Servicer, the Securities Intermediary or any of their Affiliates, shall be (and the Borrower shall cause them to
be) held by such Person in trust for the exclusive benefit of the Administrative Agent (on behalf of the Secured Parties). The
outstanding principal amount of the Advances shall not be deemed repaid by any amount of the Collections held in trust by any
Person, unless such amount is finally paid to the Administrative Agent in accordance with Section 5.2.

 

Section
5.2Application of Available Amounts.

 

(a)If
no Event of Default or Unmatured Event of Default has occurred and is continuing, the Administrative Agent and the Borrower acting
jointly, and otherwise, the Administrative Agent acting alone, shall instruct the Securities Intermediary to distribute Collections
deposited in the Collection Account, and all other amounts deposited in the Collection Account, in accordance with this Section
5.2. On or prior to each Calculation Date, the Borrower shall prepare and deliver or cause to be prepared and delivered to
the Administrative Agent a quarterly calculation report substantially in the form attached hereto as Exhibit D (the “Calculation
Date Report”) with respect to the related Distribution Date, and the Borrower shall simultaneously deliver or cause
to be delivered to the Securities Intermediary the payment instructions necessary to make the payments indicated in such Calculation
Date Report (the “Payment Instructions”). In delivering the instructions required under Section 5.2(b)
and Section 5.2(c), the Administrative Agent shall have the right to rely absolutely upon the information in the Calculation
Date Reports, unless the Administrative Agent or the Required Lenders provide alternative information to the Borrower by notice
in writing (such notice an “Alternative Information Notice”) not more than five (5) Business Days after receipt
of the related Calculation Date Report by the Administrative Agent, in which case, provided that the Borrower shall not have objected
to such Alternative Information Notice in writing within one (1) Business Day of its receipt thereof, the Administrative Agent
shall have the absolute right to act in accordance with such Alternative Information Notice. In the event that the Borrower shall
have objected to such Alternative Information Notice, then the Borrower and the Administrative Agent shall negotiate in good faith
to resolve such objection within five (5) days following the date on which the Borrower objects, the amount subject to such objection
shall be retained in the Collection Account during the pendency of such negotiations and the amount not subject to such objection
shall be distributed in accordance with Section 5.2(b) or Section 5.2(c), as applicable, and in accordance with
such Alternative Information Notice. The amount subject to such objection shall be distributed in accordance with Section 5.2(b)
or Section 5.2(c), as applicable, (i) if such objection is resolved, on the Business Day following the date on which
such objection is resolved, in which case such amounts shall be distributed in accordance with such resolution or (ii) if such
objection is not resolved, on the first Business Day following the day that is five (5) days following the date on which the Borrower
objects to such Alternative Information Notice, in which case such amounts shall be distributed in accordance with the relevant
Alternative Information Notice. Notwithstanding the foregoing, if the Borrower fails to deliver the related Calculation Date Report
or the related Payment Instructions on or prior to the related Calculation Date, then the Administrative Agent acting alone, based
on information in the Administrative Agent’s possession, shall be entitled to prepare such Calculation Date Report and Payment
Instructions and thereby instruct the Securities Intermediary to distribute Collections deposited in the Collection Account, and
all other amounts deposited in the Collection Account, to be distributed in accordance with this Section 5.2, and the Administrative
Agent shall have no liability whatsoever in respect of such instructions (the procedures set forth in this sentence if the Borrower
fails to deliver the related Calculation Date Report or the related Payment Instructions on or prior to the related Calculation
Date, the “Borrower Failure Procedures”).

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 15 of 64	 

     

    

 

(b)If
no Event of Default or Unmatured Event of Default has occurred and is continuing, on each Distribution Date, the Borrower and
the Administrative Agent shall jointly instruct the Securities Intermediary to distribute from the Available Amount then on deposit
in the Collection Account, in accordance with the Payment Instructions related to the Calculation Date Report for such Distribution
Date, subject to the delivery of an Alternative Information Notice, and the procedures set forth in Section 5.2(a) for
the resolution of any objections of the Borrower in respect of such Alternative Information Notice, or if the Borrower has failed
to deliver the related Calculation Date Report or the related Payment Instructions on or prior to the related Calculation Date,
the Administrative Agent acting alone shall instruct the Securities Intermediary to distribute from the Available Amount then
on deposit in the Collection Account, in accordance with the Borrower Failure Procedures, and in either case, the following amounts
in the following order of priority unless otherwise agreed in writing by the parties hereto (and, with respect to any payment
to the Securities Intermediary or the Custodian, as consented to by such Person in writing):

 

	First,	to
    the Custodian and the Securities Intermediary, as applicable, the fees, and expenses due and payable thereto in accordance
    with the Account Control Agreement, including, but not limited to, any Claims of any Indemnified Bank Person due and payable
    in accordance with the Account Control Agreement; provided that the aggregate amount of Claims payable under this clause “First”
    shall not exceed $25,000 on any Distribution Date; provided further, that any legal fees incurred by the Custodian and the
    Securities Intermediary on or prior to the date hereof in connection with the negotiation and drafting of this Agreement and
    the Account Control Agreement shall not count against such maximum amounts payable on any Distribution Date;
	 	 
	Second,	to
    the applicable Issuing Insurance Company, the payment of scheduled Premiums which are due and payable prior to the following
    Distribution Date as set forth in the related Premium Payment Schedule;
	 	 
	Third,	to
    the Servicer, to the extent due and payable, the Servicing Fee;

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 16 of 64	 

     

    

 

	Fourth,	to
    the Borrower or the Parent, for the payment or reimbursement of any reasonable administrative expenses and documented third-party
    expenses related to (i) the audit of the financial statements of the Borrower and the Parent pursuant to Section 9.1(d)(i)
    in an amount not to exceed $30,000 during the prior twelve (12) month period, (ii) Collateral Audits pursuant to Section
    9.1(i) in an amount not to exceed $2,200 for each Pledged Policy during the prior twelve (12) month period (unless such
    Pledged Policy is a Small Face Policy and payments of Premiums in respect of such Pledged Policy are made on an annual basis,
    in which case, $1,400 per such Pledged Policy during the prior twelve (12) month period), and (iii) any other expenses of
    the Borrower and the Parent in an amount not to exceed $5,000 per month;
	 	 
	Fifth,	(i)
    if the Distribution Date is the last Distribution Date of the calendar year, to the Administrative Agent for the account of
    the Lenders, the Loan Administration Fee for the following calendar year and (ii) to the Administrative Agent for the account
    of the Lenders, the Undrawn Fee due and payable on such date;
	 	 
	Sixth,	to
    the Administrative Agent for the account of the Lenders, any accrued interest on the Advances then due and payable on such
    date;
	 	 
	Seventh,	to
    the Administrative Agent for the account of the Lenders, the Required Amortization;
	 	 
	Eighth,	to
    the Reserve Account, the amount, if any, necessary to make the total amount on deposit in the Reserve Account equal the Reserve
    Account Required Amount;
	 	 
	Ninth,	if,
    on the related Calculation Date, (i) the Collateral consists of more than seventy-five (75) Pledged Policies insuring the
    lives of more than seventy-five (75) distinct Insureds, and (A) the LTV is equal to or greater than sixty percent (60.0%),
    all remaining Available Amounts to the Administrative Agent, for the account of the Lenders, on a pro rata basis, to repay
    the outstanding principal amount of all Advances, (B) the LTV is less than sixty percent (60.0%) but greater than or equal
    to thirty percent (30.0%), sixty-five percent (65.0%) of the remaining Available Amounts to the Administrative Agent, for
    the account of the Lenders, on a pro rata basis to repay the outstanding principal amount of all Advances, or (C) the LTV
    is less than thirty (30.0%), thirty-five percent (35.0%) of the remaining Available Amounts to the Administrative Agent, for
    the account of the Lenders on a pro rata basis to repay the outstanding principal amount of all Advances, or (ii) the Collateral
    consists of seventy-five (75) or fewer Pledged Policies insuring the lives of seventy-five (75) or fewer distinct Insureds,
    one-hundred percent (100.0%) of the remaining Available Amounts to the Administrative Agent, for the account of the Lenders,
    on a pro rata basis to repay the outstanding principal amount of all Advances (any such amount under this clause “Ninth”,
    the “Cash Sweep”);

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 17 of 64	 

     

    

 

	Tenth,	to
    the Custodian and the Securities Intermediary, as applicable, any fees and expenses due and payable thereto that remain unpaid
    (including such fees and expenses not paid pursuant to clause “First” of this Section 5.2(b)); and
	 	 
	Eleventh,	to
    the Borrower, any remaining Available Amounts by deposit to the Borrower Account.

 

(c)If
an Event of Default or an Unmatured Event of Default has occurred and is continuing, the Administrative Agent acting alone shall
instruct the Securities Intermediary to distribute from the Available Amount then on deposit in the Collection Account, in accordance
with the Payment Instructions related to the Calculation Date Report for such Distribution Date, subject to the delivery of an
Alternative Information Notice, and the procedures set forth in Section 5.2(a) for the resolution of any objections of
the Borrower in respect of such Alternative Information Notice, or if the Borrower has failed to deliver the related Calculation
Date Report or the related Payment Instructions on or prior to the related Calculation Date, the Administrative Agent acting alone
shall instruct the Securities Intermediary to distribute from the Available Amount then on deposit in the Collection Account,
in accordance with the Borrower Failure Procedures, and in either case, the following amounts in the following order of priority
unless otherwise agreed in writing by the parties hereto (and, with respect to any payments to the Securities Intermediary or
the Custodian as consented to by such Person in writing):

 

	First,	to
    the Custodian and the Securities Intermediary, as applicable, the fees, and expenses due and payable thereto in accordance
    with the Account Control Agreement, including, but not limited to, any Claims of any Indemnified Bank Person due and payable
    in accordance with the Account Control Agreement;
	 	 
	Second,	to
    the applicable Issuing Insurance Company, the payment of scheduled Premiums which are due and payable prior to the following
    Distribution Date as set forth in the related Premium Payment Schedule;
	 	 
	Third,	to
    the Servicer, to the extent due and payable, the Servicing Fee;
	 	 
	Fourth,	(i)
    if the Distribution Date is the last Distribution Date of the calendar year, to the Administrative Agent for the account of
    the Lenders, the Loan Administration Fee for the following calendar year and (ii) to the Administrative Agent for the account
    of the Lenders, the Undrawn Fee due and payable on such date;
	 	 
	Fifth,	to
    the Administrative Agent for the account of the Lenders, any accrued interest on the Advances then due and payable on such
    date;
	 	 
	Sixth,	to
    the Administrative Agent for the account of the Lenders, all outstanding principal and any other amounts with respect to the
    Advances and all other Obligations;

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 18 of 64	 

     

    

 

	Seventh,	to
    the Custodian and the Securities Intermediary, as applicable, any fees and expenses due and payable thereto that remain unpaid
    (including such fees and expenses not paid pursuant to clause “First” of this Section 5.2(c)); and
	 	 
	Eighth,	to
    the Borrower, any remaining Available Amount by deposit to the Borrower Account.

 

(d)Notwithstanding
anything herein to the contrary, prior to the applicable Calculation Date, the Administrative Agent, acting at the direction of
the Required Lenders in their sole and absolute discretion, may provide written notice to the Borrower that the percentages used
to calculate the amount of the Cash Sweep in sub-clauses (i)(A), (i)(B) and (i)(C) of Clause “Ninth” of Section
5.2(b) shall be lowered to the percentages set forth in such notice with respect to the related Distribution Date.

 

(e)For
the avoidance of doubt, no payment that is made pursuant to Clause “Ninth” of Section 5.2(b) shall constitute
the payment of Required Amortization.

 

Section
5.3Permitted Investments.

 

(a)Funds
at any time held in the Collection Account and the Reserve Account may be invested and reinvested at the direction of the Borrower
(unless an Event of Default shall have occurred and be continuing, in which case at the written direction of the Administrative
Agent) in one or more Permitted Investments in a manner provided in Section 5.3(c). In the absence of any such direction,
funds held in the Collection Account or the Reserve Account shall not be invested. Funds at any time held in the Payment Account
shall not be invested.

 

(b)Each
investment made pursuant to this Section 5.3 on any date with respect to the Collection Account or the Reserve Account
shall mature or be available not later than the Business Day preceding the Distribution Date after the day on which such investment
is made, except that any investment made on the day preceding a Distribution Date shall mature on such Distribution Date.

 

(c)Any
investment of funds in the Reserve Account or the Collection Account shall be made in Permitted Investments in which the Administrative
Agent has (or will have upon acquisition) a first priority, perfected Lien.

 

(d)The
Administrative Agent shall not be liable in any manner by reason of any insufficiency in the Collection Account or the Reserve
Account resulting from any loss on any Permitted Investment included therein.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 19 of 64	 

     

    

 

ARTICLE
VI

INCREASED COSTS, ETC.

 

Section
6.1Increased Costs. If any change in Regulation D of the Board of Governors of the Federal Reserve System, or any Regulatory
Change, in each case occurring after the date hereof:

 

(A)shall
subject any Affected Party to any Tax, duty or other charge with respect to any Advance made or funded by it, or shall change
the basis of the imposition of any Tax on payments to such Affected Party of the principal of or interest on any Advance owed
to or funded by it or any other amounts due under this Loan Agreement in respect of any Advance made or funded by it (except for
changes in the rate of Tax on the overall net income of such Affected Party imposed by any applicable jurisdiction in which such
Affected Party has an office); or

 

(B)shall
impose, modify or deem applicable any reserve (including, without limitation, any reserve imposed by the Board of Governors of
the Federal Reserve System, but excluding any reserve included in the determination of interest rates pursuant to Section 3.1),
special deposit or similar requirement against assets of, deposits with or for the account of, or credit extended by, any Affected
Party;

 

(C)shall
change the amount of capital maintained or required or requested or directed to be maintained by any Affected Party; or

 

(D)shall
impose on any Affected Party any other condition affecting any Advance made or funded by any Affected Party;

 

and
the result of any of the foregoing is or would be to (i) increase the cost to or impose a cost on an Affected Party funding or
making or maintaining any Advance (including any commitment of such Affected Party with respect to any of the foregoing), (ii)
to reduce the amount of any sum received or receivable by an Affected Party under this Loan Agreement or the Lender Notes, or
(iii) in the good faith determination of such Affected Party, to reduce the rate of return on the capital of an Affected Party
as a consequence of its obligations hereunder or arising in connection herewith to a level below that which such Affected Party
could otherwise have achieved, and, in each case, unless any of the foregoing was imposed upon such Affected Party by a regulatory
authority, such Affected Party determines that any of the foregoing also has a similar effect on any other credit facilities or
other financing arrangements that are secured by life insurance policies (or interests therein) to which such Affected Party is
a party to as a lender, administrative agent or other similar capacity, then after demand by such Affected Party to the Borrower
(which demand shall be accompanied by a written statement setting forth the basis of such demand), the Borrower shall pay such
Affected Party such additional amount or amounts as will (in the reasonable determination of such Affected Party) compensate such
Affected Party for such increased cost or such reduction. Such written statement (which shall include calculations in reasonable
detail) shall, in the absence of manifest error, be rebuttable presumptive evidence of the subject matter thereof.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 20 of 64	 

     

    

 

Section
6.2Funding Losses. The Borrower hereby agrees that upon demand by any Affected Party (which demand shall be accompanied
by a statement setting forth the basis for the calculations of the amount being claimed) the Borrower will indemnify such Affected
Party against any net loss or actual expense which such Affected Party actually sustains or incurs (including, without limitation,
any net loss or expense actually incurred by reason of the liquidation or reemployment of deposits or other funds acquired by
such Affected Party to fund or maintain any Advance made by any Lender to the Borrower), as reasonably determined by such Affected
Party, as a result of (a) any payment or prepayment (including any mandatory prepayment) of any Advance on a date other than a
Distribution Date, or (b) any failure of the Borrower to borrow any Advance on the date specified therefor in a First Initial
Advance Acceptance, a Second Initial Advance Acceptance, a Subsequent Advance Acceptance or an Additional Policy Advance Acceptance.
Such written statement shall, in the absence of manifest error, be rebuttable presumptive evidence of the subject matter thereof.

 

Section
6.3Withholding Taxes.

 

(a)All
payments made by the Borrower hereunder shall be made free and clear of, and without reduction or withholding for or on account
of, any present or future Covered Taxes. If any Covered Taxes are required to be withheld from any amounts payable to the Administrative
Agent or any Lender, the amounts so payable to the Administrative Agent or such Lender shall be increased to the extent necessary
to yield to the Administrative Agent or such Lender (after payment of all Taxes) all such amounts payable hereunder at the rates
or in the amounts specified herein. Whenever any Covered Taxes are payable by the Borrower, as promptly as possible thereafter,
the Borrower shall send to the Administrative Agent for its own account or for the account of the related Lender, as the case
may be, a certified copy or an original official receipt received by the Borrower showing payment thereof. If the Borrower fails
to pay any Covered Taxes when due to the appropriate taxing authority or fails to remit to the Administrative Agent the required
documentary evidence, the Borrower shall indemnify the Administrative Agent and each Lender for such Covered Taxes and any incremental
Taxes that may become payable by the Administrative Agent or any Lender as a result of any such failure.

 

(b)At
least five (5) Business Days prior to the first date on which any payments, including discount or Fees, are payable hereunder
for the account of any Lender, if such Lender is not organized under the laws of the United States, such Lender agrees to deliver
to each of the Borrower, the Securities Intermediary and the Administrative Agent two (2) duly completed copies of (i) United
States Internal Revenue Service Form W-8BEN or W-8ECI (or successor applicable form) certifying that such Lender is entitled to
receive payments hereunder without deduction or withholding, or at a reduced rate of withholding, of any United States federal
income taxes, provided such Lender is legally able to provide such forms or (ii) United States Internal Revenue Service Form W-9
or substitute W-9 (or successor applicable form) to establish an exemption from United States backup withholding tax. Each Lender
shall replace or update such forms as is necessary or appropriate to maintain any applicable exemption or as is requested by the
Administrative Agent, the Securities Intermediary or the Borrower.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 21 of 64	 

     

    

 

ARTICLE
VII

CONDITIONS TO BORROWING

 

The
making of the Advances hereunder is subject to the following conditions precedent:

 

Section
7.1Conditions Precedent to the Closing and the First Initial Advance. The Administrative Agent and the Lenders shall
have no obligation to consummate the transactions contemplated by this Loan Agreement and make the First Initial Advance unless:

 

(a)Representations
and Covenants. On and as of the date of the First Initial Advance: (i) the representations of each of the Borrower, the Parent,
the Custodian, the Securities Intermediary and the Servicer set forth in the Transaction Documents shall be true and correct with
the same effect as if made on such date, and (ii) each of the Borrower, the Parent, the Custodian, the Securities Intermediary
and the Servicer shall be in compliance with the covenants set forth in the Transaction Documents to which it is a party.

 

(b)Closing
Documents. The Administrative Agent shall have received all of the following, each duly executed and dated as of the Closing
Date, in form and substance satisfactory to the Required Lenders:

 

(i)Transaction
Documents. Duly executed and delivered counterparts of this Loan Agreement and each other Transaction Document, which agreements
shall be in full force and effect.

 

(ii)Resolutions;
Organizational Documentation. Certified copies of resolutions for the Borrower and the Parent authorizing or ratifying the
execution, delivery and performance of each Transaction Document to which it is, or will be, a party, together with certified
copies of the Borrower Organizational Documents and in the case of the Parent, a certified copy of its certificate of formation
and limited liability company agreement.

 

(iii)Consents,
etc. Certified copies of all documents evidencing any necessary waivers, consents and approvals required by the Borrower,
the Parent and the Servicer with respect to each Transaction Document to which it is a party (including, without limitation, any
and all approvals required for the Borrower or the Servicer to service the Collateral).

 

(iv)Incumbency
and Signatures. A certificate of each of the Borrower, the Parent and the Servicer, certifying the names of its or its trustee’s
or members, managers, directors or officers authorized to sign each Transaction Document to which it is, or will be, a party.

 

(v)Good
Standing Certificates. Good standing certificates for each of the Borrower, the Parent and the Servicer issued as of a recent
date acceptable to the Administrative Agent by: (i) the Secretary of State (or similar governmental authority) of the jurisdiction
of such Person’s formation, and (ii) the Secretary of State (or similar governmental authority) of the jurisdiction where
such Person’s chief executive office and principal place of business are located.

 

(vi)Financing
Statements. Copies of UCC-1 financing statements, in form and substance satisfactory to Administrative Agent, to be filed
on or before the Closing Date, naming each of the Borrower and the Parent as debtor, and Administrative Agent, for the benefit
of the Secured Parties, as secured party, and other documents necessary or reasonably requested by Administrative Agent, to evidence
the perfection of the Administrative Agent’s security interest in the Collateral.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 22 of 64	 

     

    

 

(vii)Lien
Search Report. Results of completed UCC and tax and judgment lien searches and court searches for the jurisdictions of formation
and chief executive office of the Borrower and Parent dated within two (2) weeks before the Closing Date that name the Borrower
and Parent as debtor (none of which shall show any of the Collateral subject to any Liens other than those created pursuant to
the Transaction Documents).

 

(viii)Payment
of Fees. Evidence (which may be in the form of one or more wire instructions and/or confirmations) that all Fees payable hereunder
or under any other Transaction Document and all costs and expenses then due and payable have been paid or will be paid out of
the proceeds of the First Initial Advance.

 

(ix)Opinions
of Counsel. Opinions of counsel to the Borrower, the Parent, the Custodian, the Securities Intermediary and the Servicer,
in form and substance satisfactory to the Administrative Agent.

 

(x)Accounts.
Evidence that the Accounts, the Policy Account and the Borrower Account have been established in accordance with the Transaction
Documents and on the Closing Date, the amount on deposit in the Reserve Account is equal to $11,250,000 and the amount on deposit
in the Payment Account is equal to $13,768,088.26.

 

(xi)Collateral
Package. Copies of the complete Collateral Packages for the Subject Policies satisfactory to the Administrative Agent as of
the Closing Date.

 

(xii)Consent
and Estoppel Agreements. Executed consent and estoppel agreements in form and substance satisfactory to the Administrative
Agent from certain contractual counterparties previously designated in writing by the Administrative Agent (including, without
limitation, the Servicer, the Custodian and the Securities Intermediary).

 

(xiii)Insurance
Consultant. Reports produced by the Insurance Consultant, in form and substance satisfactory to the Administrative Agent.

 

(xiv)Material
Contracts. Certified copies of all material contracts and other agreements of the Borrower or relating to the Collateral.

 

(xv)Operational
Plan and Annual Budget. The Operational Plan and Annual Budget, with respect to the Subject Policies as of the Closing Date,
in form and substance reasonably acceptable to the Administrative Agent and the Insurance Consultant.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 23 of 64	 

     

    

 

(xvi)Solvency
Certificate. A certificate of solvency executed by an officer or director of the Parent, certifying that each of the Borrower
and the Parent is and will be Solvent and able to pay its debts as they come due, and will have adequate capital to conduct its
business.

 

(xvii)Others.
Such other documents as the Administrative Agent may reasonably request.

 

(c)LTV.
After giving effect to the First Initial Advance, the LTV shall not exceed sixty percent (60.0%), as determined by the Required
Lenders in their sole and absolute discretion.

 

(d)Reserved.

 

(e)Eligible
Policies. Each of the Subject Policies as of the Closing Date shall be an Eligible Policy, as determined by the Required Lenders
in their sole and absolute discretion.

 

(f)Delivery
of Policies to Custodian. The originals of all Subject Policies (or, if not available, certified copies thereof), and all
other documents comprising the related Custodial Packages (including all originals thereof, to the extent required or, if not
required, to the extent available) shall have been delivered to and are held by the Custodian, including evidence that all Premiums
required to be funded prior to the Closing Date in order to keep the Subject Policies in force and not in grace or lapse status
through at least forty-five (45) days thereafter have been paid, and the Custodian shall have verified to the Administrative Agent
in writing its receipt of all documents required to be contained in the related Custodial Package by delivering the required certification
pursuant to the terms of the Account Control Agreement.

 

(g)Satisfactory
Tax Review. The Required Lenders shall be satisfied with their review of all tax matters relating to the Borrower.

 

(h)Security
Interest. The Required Lenders shall be satisfied that the Liens and security interests created under and granted by the Transaction
Documents are first priority perfected exclusive Liens and will not be subject to any other senior or pari passu Liens, security
interests or any other Adverse Claims prior to or after the Closing Date as determined in the Required Lenders’ sole and
absolute discretion.

 

(i)No
Material Change in Laws. Since January 1, 2015, no material adverse change in any Applicable Law or any tax treatment of life
insurance death benefits or proceeds shall have occurred or reasonably could be expected to occur.

 

(j)Collateral
Assignment. The Securities Intermediary or the Insurance Consultant shall have delivered to the related Issuing Insurance
Companies a fully completed and executed collateral assignment in respect of each Subject Policy on the Closing Date, naming the
Administrative Agent, on behalf of the Lenders, as the collateral assignee and the Administrative Agent shall have received verbal
confirmation on a recorded line from each of the related Issuing Insurance Companies that all such collateral assignments have
been received by such Issuing Insurance Companies and no other collateral assignments are on file with such Issuing Insurance
Companies.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 24 of 64	 

     

    

 

(k)Acknowledgements.
The Securities Intermediary shall have delivered written confirmation to the Administrative Agent that it has received an Acknowledgement
for each Subject Policy and has credited each Subject Policy to the Policy Account and the Securities Intermediary shall have
delivered copies of each such Acknowledgement to the Administrative Agent.

 

(l)Change
Forms. The Securities Intermediary shall have confirmed to the Administrative Agent in writing that it is holding completed
Change Forms with respect to the Subject Policies executed by the Securities Intermediary in blank and the Administrative Agent
shall have received copies of such Change Forms.

 

(m)No
Event of Default or Unmatured Event of Default. No Event of Default or Unmatured Event of Default shall have occurred and
be continuing or will result from the making of the First Initial Advance.

 

(n)Borrowing
Request; etc. The Administrative Agent shall have received a Borrowing Request (including (i) a confirmation that the Collateral
Packages for the Subject Policies have been uploaded to the FTP Site and (ii) a Borrowing Base Certificate) for the First Initial
Advance (which may be an electronic or facsimile transmission).

 

(o)Third
Party Releases. The Borrower and the Parent shall have executed and delivered all necessary third party releases with respect
to the Subject Policies, as determined by the Administrative Agent in its sole and absolute discretion.

 

(p)Insurance
Consultant. The Borrower shall have executed and delivered or caused all necessary third parties to execute and deliver all
documentation and authorizations necessary for the Insurance Consultant to communicate and receive verifications of coverage and
obtain other information from the Issuing Insurance Companies related to the Subject Policies, as determined by the Administrative
Agent in its sole and absolute discretion.

 

(q)Collateral
Packages. The Borrower shall have uploaded the Collateral Packages for the Subject Policies to the FTP Site.

 

(r)Lender
Notes. Each Lender shall have received an executed original of its Lender Note.

 

Section
7.2Conditions Precedent to the Second Initial Advance. The Administrative Agent and the Lenders shall have no obligation
to make the Second Initial Advance unless:

 

(a)Representations
and Covenants. On and as of the date of the Second Initial Advance: (i) the representations of each of the Borrower, the Parent,
the Custodian, the Securities Intermediary and the Servicer set forth in the Transaction Documents shall be true and correct with
the same effect as if made on such date, and (ii) each of the Borrower, the Parent, the Custodian, the Securities Intermediary
and the Servicer shall be in compliance with the covenants set forth in the Transaction Documents to which it is a party.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 25 of 64	 

     

    

 

(b)Closing
Documents. The Administrative Agent shall have received all of the following, each duly executed and dated as of the date
of the Second Initial Advance, in form and substance satisfactory to the Required Lenders:

 

(i)Good
Standing Certificates. Good standing certificates for each of the Borrower, the Parent and the Servicer issued as of a recent
date acceptable to the Administrative Agent by: (i) the Secretary of State (or similar governmental authority) of the jurisdiction
of such Person's formation, and (ii) the Secretary of State (or similar governmental authority) of the jurisdiction where such
Person's chief executive office and principal place of business are located.

 

(ii)Lien
Search Report. Results of completed UCC and tax and judgment lien searches and court searches for the jurisdictions of formation
and chief executive office of the Borrower and Parent dated within two (2) weeks before the date of the Second Initial Advance
that name the Borrower and Parent as debtor (none of which shall show any of the Collateral subject to any Liens other than those
created pursuant to the Transaction Documents).

 

(iii)Payment
of Fees. Evidence (which may be in the form of one or more wire instructions and/or confirmations) that all Fees payable hereunder
or under any other Transaction Document and all costs and expenses then due and payable have been paid or will be paid out of
the proceeds of the Second Initial Advance.

 

(iv)Collateral
Package. Copies of the complete Collateral Packages for the Subject Policies satisfactory to the Administrative Agent as of
the date of the Second Initial Advance.

 

(v)Insurance
Consultant. Reports produced by the Insurance Consultant, in form and substance satisfactory to the Administrative Agent.

 

(vi)Operational
Plan and Annual Budget. The Operational Plan and Annual Budget, with respect to the Subject Policies as of the date of the
Second Initial Advance, in form and substance reasonably acceptable to the Administrative Agent and the Insurance Consultant.

 

(vii)Solvency
Certificate. A certificate of solvency executed by an officer or director of the Parent, certifying that each of the Borrower
and the Parent is and will be Solvent and able to pay its debts as they come due, and will have adequate capital to conduct its
business.

 

(viii)Others.
Such other documents as the Administrative Agent may reasonably request.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 26 of 64	 

     

    

 

(c)LTV.
After giving effect to the Second Initial Advance, the LTV shall not exceed sixty percent (60.0%), as determined by the Required
Lenders in their sole and absolute discretion.

 

(d)Reserved.

 

(e)Eligible
Policies. Each of the Subject Policies as of the date of the Second Initial Advance shall be an Eligible Policy, as determined
by the Required Lenders in their sole and absolute discretion.

 

(f)Delivery
of Policies to Custodian. The originals of all Subject Policies (or, if not available, certified copies thereof), and all
other documents comprising the related Custodial Packages (including all originals thereof, to the extent required or, if not
required, to the extent available) shall have been delivered to and are held by the Custodian, including evidence that all Premiums
required to be funded prior to the date of Second Initial Advance in order to keep the Subject Policies in force and not in grace
or lapse status through at least forty-five (45) days thereafter have been paid, and the Custodian shall have verified to the
Administrative Agent in writing its receipt of all documents required to be contained in the related Custodial Package by delivering
the required certification pursuant to the terms of the Account Control Agreement.

 

(g)Security
Interest. The Required Lenders shall be satisfied that the Liens and security interests created under and granted by the Transaction
Documents are first priority perfected exclusive Liens and will not be subject to any other senior or pari passu Liens, security
interests or any other Adverse Claims prior to or after the date of the Second Initial Advance as determined in the Required Lenders'
sole and absolute discretion.

 

(h)No
Material Change in Laws. Since January 1, 2015, no material adverse change in any Applicable Law or any tax treatment of life
insurance death benefits or proceeds shall have occurred or reasonably could be expected to occur.

 

(i)Collateral
Assignment. The Securities Intermediary or the Insurance Consultant shall have delivered to the related Issuing Insurance
Companies a fully completed and executed collateral assignment in respect of each Subject Policy on or prior to the date of the
Second Initial Advance, naming the Administrative Agent, on behalf of the Lenders, as the collateral assignee and the Administrative
Agent shall have received verbal confirmation on a recorded line from each of the related Issuing Insurance Companies that all
such collateral assignments have been received by such Issuing Insurance Companies and no other collateral assignments are on
file with such Issuing Insurance Companies.

 

(j)Acknowledgements.
The Securities Intermediary shall have delivered written confirmation to the Administrative Agent that it has received an Acknowledgement
for each Subject Policy and has credited each Subject Policy to the Policy Account and the Securities Intermediary shall have
delivered copies of each such Acknowledgement to the Administrative Agent.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 27 of 64	 

     

    

 

(k)Change
Forms. The Securities Intermediary shall have confirmed to the Administrative Agent in writing that it is holding completed
Change Forms with respect to the Subject Policies executed by the Securities Intermediary in blank and the Administrative Agent
shall have received copies of such Change Forms.

 

(l)No
Event of Default or Unmatured Event of Default. No Event of Default or Unmatured Event of Default shall have occurred and
be continuing or will result from the making of the Second Initial Advance.

 

(m)Borrowing
Request; etc. The Administrative Agent shall have received a Borrowing Request (including (i) a confirmation that the Collateral
Packages for the Subject Policies have been uploaded to the FTP Site and (ii) a Borrowing Base Certificate) for the Second Initial
Advance (which may be an electronic or facsimile transmission).

 

(n)Third
Party Releases. The Borrower and the Parent shall have executed and delivered all necessary third party releases with respect
to the Subject Policies, as determined by the Administrative Agent in its sole and absolute discretion.

 

(o)Insurance
Consultant. The Borrower shall have executed and delivered or caused all necessary third parties to execute and deliver all
documentation and authorizations necessary for the Insurance Consultant to communicate and receive verifications of coverage and
obtain other information from the Issuing Insurance Companies related to the Subject Policies, as determined by the Administrative
Agent in its sole and absolute discretion.

 

(p)Collateral
Packages. The Borrower shall have uploaded the Collateral Packages for the Subject Policies to the FTP Site.

 

(q)Transaction
Documents. Each of the Transaction Documents shall be in full force and effect.

 

(r)Commitments.
The Lenders' Commitments shall have not been terminated.

 

(s)Material
Adverse Effect. No event shall have occurred that could reasonably be expected to have a Material Adverse Effect.

 

Section
7.3Conditions Precedent to each Ongoing Maintenance Advance. The Administrative Agent and the Lenders shall have no
obligation to make an Ongoing Maintenance Advance unless:

 

(a)Representations
and Covenants. On and as of the date of such Ongoing Maintenance Advance: (i) the representations of each of the Borrower,
the Parent, the Custodian, the Securities Intermediary and the Servicer set forth in the Transaction Documents shall be true and
correct with the same effect as if made on such date, and (ii) each of the Borrower, the Parent, the Custodian, the Securities
Intermediary and the Servicer shall be in compliance with the covenants set forth in the Transaction Documents to which it is
a party.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 28 of 64	 

     

    

 

(b)Fees.
All Fees due and payable shall have been paid.

 

(c)LTV.
After giving effect to such Ongoing Maintenance Advance, the LTV shall not exceed fifty percent (50.0%), as determined by the
Required Lenders in their sole and absolute discretion.

 

(d)Borrowing
Base. Such Ongoing Maintenance Advance shall not exceed an amount such that such Ongoing Maintenance Advance, when taken together
with the outstanding balance of all previous Advances (including any Protective Advances), would cause the aggregate outstanding
balance of the Advances to exceed the Borrowing Base as of the date of such Ongoing Maintenance Advance.

 

(e)No
Liens; First Priority Security Interest. There shall be no encumbrance or Lien on any of the Collateral other than Liens or
encumbrances created or expressly permitted under the Transaction Documents.

 

(f)No
Material Change in Laws. Since January 1, 2015, no material adverse change in any Applicable Law or any tax treatment of life
insurance death benefits or proceeds shall have occurred or reasonably could be expected to occur.

 

(g)No
Event of Default or Unmatured Event of Default. No Event of Default or Unmatured Event of Default shall have occurred and
be continuing or will result from the making of such Ongoing Maintenance Advance.

 

(h)Borrowing
Request; etc. The Administrative Agent shall have received a Borrowing Request (including a Borrowing Base Certificate) for
such Ongoing Maintenance Advance (which may be an electronic or facsimile transmission).

 

(i)Transaction
Documents. Each of the Transaction Documents shall be in full force and effect.

 

(j)Commitments.
The Lenders' Commitments shall have not been terminated.

 

(k)Material
Adverse Effect. No event shall have occurred during the shorter of (i) the three (3) year period preceding the date of such
Ongoing Maintenance Advance and (ii) the period of time commencing on the Closing Date and ending on the date of such Ongoing
Maintenance Advance, that could reasonably be expected to have a Material Adverse Effect.

 

(l)Other
Ongoing Maintenance Advances. The Lenders shall not have made any other Ongoing Maintenance Advances in the calendar quarter
of the proposed Advance Date for such Ongoing Maintenance Advance.

 

(m)Advance
Date. The proposed Advance Date for such Ongoing Maintenance Advance is on or after March 14, 2017 and on or prior to September
14, 2021.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 29 of 64	 

     

    

 

Section
7.4Conditions Precedent to each Additional Policy Advance. The making of each Additional Policy Advance is subject
to conditions precedent to be determined by the Lenders in their sole and absolute discretion.

 

Section
7.5Lender Valuation.

 

(a)Lender
Valuation. With respect to each Distribution Date, the Administrative Agent shall, within three (3) Business Days prior to
the related Calculation Date, provide the Borrower with the Lender Valuation of the Pledged Policies (including the amount of
the Lender Valuation allocated to each individual Pledged Policy) as of such Calculation Date, along with the calculation of the
Borrowing Base. In addition, with respect to each calendar month in which a Distribution Date does not occur, the Administrative
Agent shall, within ten (10) Business Days after the last day of the immediately preceding calendar month, provide the Borrower
with the Lender Valuation of the Pledged Policies (including the amount of the Lender Valuation allocated to each individual Pledged
Policy) as of the last day of the immediately preceding calendar month. The Borrower and Required Lenders hereby acknowledge that
the methodology and metrics utilized by the Required Lenders in determining the Lender Valuation may be different than the methodology
and metrics utilized by the Borrower and its Affiliates in determining the value of the Pledged Policies in connection with preparing
the financial statements of the Borrower and its Affiliates.

 

(b)Lender
Valuation Dispute. Subject to the third to last sentence of this Section 7.5(b), if the Borrower disagrees with a Lender
Valuation relating to a determination of the LTV, it may dispute such Lender Valuation (a “Valuation Dispute”).
The Borrower shall obtain a valuation of the Collateral from a third-party acceptable to the Required Lenders in their commercially
reasonable judgment who is experienced in valuing Policies (a “Borrower Valuation”). In the event the Borrower
Valuation (A) is more than ten percent (10%) higher than the Lender Valuation of the Pledged Policies and (B) results in an LTV
of less than fifty percent (50%), then, at the Administrative Agent’s option, (i) on the first Distribution Date occurring
after the Borrower obtains such Borrower Valuation, such Borrower Valuation will be used for the determination of the LTV and
the Cash Sweep shall be based on such determination (and for each subsequent Distribution Date, the Lender Valuation, as determined
by the Administrative Agent from time to time, will be used for all subsequent determinations of the LTV, subject to the Borrower
initiating any future Valuation Disputes in accordance with the terms hereof) or (ii) the Administrative Agent may request in
writing that the Borrower repay all the Advances outstanding plus accrued interest and expenses in respect thereof (a “Payoff
Notice”). If the Borrower does not repay such amount in full within one hundred eighty (180) days of the Payoff Notice,
the Borrower will no longer have the right to initiate a Valuation Dispute and the Lender Valuation, as determined by the Administrative
Agent from time to time, will be used for all subsequent determinations of the LTV. During such one hundred eighty (180) day period,
the LTV and the related Lender Valuation shall equal the amounts as initially calculated by the Required Lenders and the Cash
Sweep shall be based on such initial calculation. No Yield Maintenance Fee shall be payable in connection with the repayment of
Advances by the Borrower pursuant to this Section 7.5(b).

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 30 of 64	 

     

    

 

Section
7.6Release. AS AN ADDITIONAL MATERIAL INDUCEMENT TO THE ADMINISTRATIVE AGENT AND THE LENDERS TO MAKE THE SECOND INITIAL
ADVANCE, UPON THE MAKING OF THE SECOND INITIAL ADVANCE, THE BORROWER, ON BEHALF OF ITSELF AND ITS SUCCESSORS, ASSIGNS, LEGAL REPRESENTATIVES
AND CONSTITUENTS (WHETHER OR NOT A PARTY HERETO) (BORROWER AND SUCH SUCCESSORS, ASSIGNS, LEGAL REPRESENTATIVES AND CONSTITUENTS
BEING REFERRED TO HEREIN COLLECTIVELY AND INDIVIDUALLY, AS “OBLIGORS, ET AL.”), FULLY, FINALLY AND COMPLETELY RELEASES
AND FOREVER DISCHARGES THE LENDERS, THE ADMINISTRATIVE AGENT AND THEIR RESPECTIVE OWNERS, SUCCESSORS, ASSIGNS, AFFILIATES, SUBSIDIARIES,
PARENTS, OFFICERS, SHAREHOLDERS, DIRECTORS, EMPLOYEES, ATTORNEYS AND AGENTS, PAST, PRESENT AND FUTURE, AND THEIR RESPECTIVE HEIRS,
PREDECESSORS, SUCCESSORS AND ASSIGNS (COLLECTIVELY AND INDIVIDUALLY, “LENDER, ET AL.”) OF AND FROM ANY AND ALL CLAIMS,
CONTROVERSIES, DISPUTES, LIABILITIES, OBLIGATIONS, DEMANDS, DAMAGES, EXPENSES (INCLUDING, WITHOUT LIMITATION, REASONABLE ATTORNEYS’
FEES), DEBTS, LIENS, ACTIONS AND CAUSES OF ACTION OF ANY AND EVERY NATURE WHATSOEVER, INCLUDING, WITHOUT LIMITATION, ANY THEREOF
RELATING TO THE ADVANCES, AND WAIVES AND RELEASES ANY DEFENSE, RIGHT OF COUNTERCLAIM, RIGHT OF SET-OFF OR DEDUCTION TO THE PAYMENT
OF THE INDEBTEDNESS EVIDENCED BY THE LENDER NOTES AND/OR ANY OTHER TRANSACTION DOCUMENT WHICH OBLIGORS, ET AL. MAY HAVE OR MAY
CLAIM TO HAVE AGAINST LENDER, ET AL., OR ANY THEREOF, ARISING OUT OF, CONNECTED WITH OR RELATING TO ANY AND ALL ACTS, OMISSIONS
OR EVENTS OCCURRING PRIOR TO THE DATE OF THE MAKING OF THE SECOND INITIAL ADVANCE. THE BORROWER HEREBY ACKNOWLEDGES, REPRESENTS
AND WARRANTS TO THE LENDERS AND THE ADMINISTRATIVE AGENT THAT IT AGREES TO ASSUME THE RISK OF ANY AND ALL UNKNOWN, UNANTICIPATED
OR MISUNDERSTOOD DEFENSES AND CLAIMS WHICH ARE RELEASED BY THE PROVISIONS HEREOF IN FAVOR OF LENDER, ET AL., AND WAIVES AND RELEASES
ALL RIGHTS AND BENEFITS WHICH IT MIGHT OTHERWISE HAVE UNDER ANY FEDERAL, STATE OR LOCAL LAW OR STATUTE WITH REGARD TO THE RELEASE
OF SUCH UNKNOWN, UNANTICIPATED OR MISUNDERSTOOD DEFENSES OR CLAIMS. THE BORROWER ACKNOWLEDGES THAT IT HAS READ AND UNDERSTANDS
EACH OF THE PROVISIONS OF THIS RELEASE. THE BORROWER FULLY UNDERSTANDS THAT THIS RELEASE CONSTITUTES A GENERAL RELEASE, AND THAT
IT HAS IMPORTANT LEGAL CONSEQUENCES. THE BORROWER CONFIRMS THAT IT WILL HEREBY RELEASE ANY AND ALL RELEASED CLAIMS THAT IT MAY
INDIVIDUALLY HAVE AS OF THE DATE OF THE MAKING OF THE SECOND INITIAL ADVANCE. THE BORROWER HEREBY ACKNOWLEDGES THAT IT HAS HAD
A FULL AND FAIR OPPORTUNITY TO OBTAIN A LAWYER’S ADVICE CONCERNING THE LEGAL CONSEQUENCES OF THIS RELEASE AND WAIVER.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 31 of 64	 

     

    

 

Section
7.7Additional Representations and Warranties. As an additional material inducement to the Administrative Agent and
the Lenders to make the Second Initial Advance, Borrower hereby represents and warrants to, and agrees with, the Lenders and the
Administrative Agent that, as of the date of the making of the Second Initial Advance, the Borrower has no defense, counterclaim
or offset to the payment or performance of any of the Borrower's obligations in regard to the Advances or any of the Transaction
Documents and the Liens created and granted by the Transaction Documents continue unimpaired and of first priority and secure
all existing and future obligations owed to the Lenders and/or the Administrative Agent in regard to the Advances.

 

ARTICLE
VIII

REPRESENTATIONS AND WARRANTIES

 

Section
8.1Representations and Warranties of the Borrower. The Borrower makes the following representations and warranties
to the Administrative Agent and each Lender:

 

(a)Organization,
etc. The Borrower has been duly organized and is validly existing and in good standing under the laws of the State of Delaware
(and is not organized under the laws of any other jurisdiction or Governmental Authority) with the requisite power and authority
to own its properties and to conduct its business as such properties are presently owned and such business is presently conducted.
The Borrower is duly licensed or qualified to do business as a foreign entity in good standing in each jurisdiction in which the
failure to be so licensed or qualified would be reasonably likely to have a Material Adverse Effect.

 

(b)Power
and Authority; Due Authorization. The Borrower has (a) all necessary power, authority and legal right to (i) execute, deliver
and perform its obligations under this Loan Agreement and each of the other Transaction Documents to which it is a party, and
(ii) to borrow money on the terms and subject to the conditions herein provided, and (b) duly authorized, by all necessary action,
the execution, delivery and performance of this Loan Agreement and the other Transaction Documents to which it is a party, the
borrowing hereunder on the terms and conditions of this Loan Agreement and the granting of security therefor on the terms and
conditions provided herein.

 

(c)No
Violation. The consummation of the transactions contemplated by this Loan Agreement and the other Transaction Documents and
the fulfillment of the terms hereof and thereof will not and do not (a) conflict with, result in any breach of any of the terms
and provisions of, or constitute (with or without notice or lapse of time or both) a default under, (i) the Borrower Organizational
Documents, or (ii) any indenture, loan agreement, pooling and servicing agreement, sale agreement, purchase agreement, mortgage,
deed of trust, or other agreement or instrument to which the Borrower is a party or by which the Borrower or any of its properties
is bound, (b) result in or require the creation or imposition of any Adverse Claim upon any of its properties pursuant to the
terms of any such indenture, loan agreement, pooling and servicing agreement, sale agreement, purchase agreement, mortgage, deed
of trust, or other agreement or instrument, other than pursuant to the terms of the Transaction Documents or (c) violate any law
or any order, rule, or regulation applicable to the Borrower or of any court or of any federal, state or foreign regulatory body,
administrative agency, or other governmental instrumentality having jurisdiction over the Borrower or any of its properties.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 32 of 64	 

     

    

 

(d)Validity
and Binding Nature. This Loan Agreement is, and the other Transaction Documents to which it is a party when duly executed
and delivered by the Borrower and the other parties thereto will be, the legal, valid and binding obligation of the Borrower,
enforceable in accordance with their respective terms, except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar law affecting creditors’ rights generally and by general principles of equity.

 

(e)Government
Approvals. No authorization or approval or other action by, and no notice to or filing with, any Governmental Authority or
regulatory body required for the due execution, delivery or performance by the Borrower of any Transaction Document to which it
is a party, remains unobtained or unfiled.

 

(f)Solvency.
As of each Advance Date, after giving effect to each Advance made on such Advance Date, the Borrower is and will be Solvent and
able to pay its debts as they come due, and will have adequate capital to conduct its business.

 

(g)Margin
Regulations. The Borrower is not engaged in the business of extending credit for the purpose of purchasing or carrying margin
stock, and no proceeds of any Advances, directly or indirectly, will be used for a purpose that violates, or would be inconsistent
with, Regulations T, U and X promulgated by the Federal Reserve Board from time to time.

 

(h)Quality
of Title. As of each Advance Date, the Collateral, including, without limitation, the Pledged Policies (which, for the avoidance
of doubt, includes any Subject Policies), is owned by the Borrower (directly or through the Securities Intermediary) free and
clear of any Adverse Claim.

 

(i)No
Rescission. As of each Advance Date, no prior seller of any Pledged Policy or Subject Policy or any other Person which had
an interest in any Pledged Policy or Subject Policy has exercised or, to the knowledge of the Borrower, the Parent or any Affiliate
of any of them, attempted to exercise the right to rescind the sale of any Pledged Policy or Subject Policy.

 

(j)Perfection.
This Loan Agreement, the Account Control Agreement, the collateral assignments filed in respect of the Pledged Policies and the
financing statements filed in connection with this Loan Agreement create a valid first priority security interest in favor of
the Administrative Agent (for the benefit of the Secured Parties) in the Collateral, which security interest has been perfected
(free and clear of any Adverse Claim) as security for the Obligations. As of the Closing Date and each Advance Date, no effective
financing statement or other instrument similar in effect covering any of the Collateral (including, without limitation, any Pledged
Policies) or any interest therein owned by the Borrower (directly or through the Securities Intermediary) is on file in any recording
office except for financing statements in favor of the Administrative Agent (for the benefit of the Secured Parties) in accordance
with this Loan Agreement and the other Transaction Documents.

 

(k)Offices.
The principal place of business and chief executive office of the Parent and of the Borrower is located at the address set forth
on Schedule 13.2 (or at such other locations, notified to the Administrative Agent in jurisdictions where all action required
hereby has been taken and completed).

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 33 of 64	 

     

    

 

(l)Compliance
with Applicable Laws; Licenses, etc.

 

(i)The
Borrower is in compliance with the requirements of all Applicable Laws, a breach of any of which, individually or in the aggregate,
could reasonably be expected to have an adverse effect on any of the Pledged Policies, the business, assets, financial condition
or operations of the Borrower or any of the rights or interests of the Administrative Agent or any of the Lenders hereunder or
under any other Transaction Document.

 

(ii)The
Borrower has not failed to obtain any licenses, permits, franchises or other governmental authorizations necessary to the ownership
of its properties or to the conduct of its business, which violation or failure to obtain could reasonably be expected to have
an adverse effect on any of the Pledged Policies, any other Collateral, the business, assets, financial condition or operations
of the Borrower or any of the rights or interests of the Administrative Agent or any of the Lenders hereunder or under any other
Transaction Document.

 

(iii)The
Borrower has complied with all licensure requirements in each state in which it is required to be specifically registered or licensed
as a purchaser, owner or servicer of life insurance policies.

 

(iv)There
has been no event or circumstance that could reasonably be expected to result in the revocation of any license, permit, franchise
or other governmental authorization of the Borrower necessary to the ownership of its properties or to the conduct of its business.

 

(m)No
Proceedings. There is no order, judgment, decree, injunction, stipulation or consent order of or with any Governmental Authority
to which the Borrower is subject, and there is no action, suit, arbitration, regulatory proceeding or investigation pending, or,
to the actual knowledge of the Borrower, threatened, before or by any court, regulatory body, administrative agency or other tribunal
or governmental instrumentality, against the Borrower that, individually or in the aggregate, could reasonably be expected to
have a Material Adverse Effect; and there is no action, suit, proceeding, arbitration, regulatory or governmental investigation,
pending or, to the actual knowledge of the Borrower, threatened, before or by any court, regulatory body, administrative agency,
or other tribunal or governmental instrumentality (A) asserting the invalidity of this Loan Agreement, the Lender Notes or any
other Transaction Document, (B) seeking to prevent the issuance of the Lender Notes or the consummation of any of the other transactions
contemplated by this Loan Agreement or any other Transaction Document, (C) seeking to adversely affect the federal income tax
attributes of the Borrower or (D) asserting that any Pledged Policy or Policy to become a Pledged Policy is invalid, void or otherwise
unenforceable for any reason.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 34 of 64	 

     

    

 

(n)Investment
Company Act, Etc. The Borrower is not an “investment company” or a company “controlled” by an “investment
company” within the meaning of the Investment Company Act of 1940, as amended, by virtue of an exemption other than pursuant
to Section 3(c)(1) or Section 3(c)(7) thereof. The Borrower is not a “covered fund” under Section 13 of the Bank Holding
Company Act of 1956, as amended.

 

(o)Eligible
Policies. As of the Closing Date, (i) each Pledged Policy is an Eligible Policy and no Pledged Policy is subject to any Applicable
Law that makes unlawful the sale, transfer or assignment of such Pledged Policy and (ii) with respect to each Pledged Policy,
the Borrower is not aware of any agreements, documents, assignments or instruments related to such Policy except for those documents,
assignments, and instruments that constitute and were included in the related Collateral Package that was delivered to the Administrative
Agent and such Collateral Package contains, at the very least, the documents set forth in Exhibit M to the Account Control Agreement.
As of the date of the Borrowing Request relating to the Second Initial Advance and the date of the Second Initial Advance, (i)
each Policy that will become a Pledged Policy on the relevant Advance Date is or will be an Eligible Policy and is not subject
to any Applicable Law that makes unlawful the sale, transfer or assignment of such Policy and (ii) with respect to each Policy
that will become a Pledged Policy on the relevant Advance Date, the Borrower is not aware of any agreements, documents, assignments
or instruments related to such Policy except for those documents, assignments, and instruments that constitute and were included
in the related Collateral Package that was delivered to the Administrative Agent and such Collateral Package contains, at the
very least, the documents set forth in Exhibit M to the Account Control Agreement. As of the date of any Borrowing Request relating
to an Additional Policy Advance and the date of such Additional Policy Advance, (i) each Additional Policy that will become a
Pledged Policy on the relevant Advance Date is or will be an Eligible Policy and is not subject to any Applicable Law that makes
unlawful the sale, transfer or assignment of such Additional Policy and (ii) with respect to each Additional Policy that will
become a Pledged Policy on the relevant Advance Date, the Borrower is not aware of any agreements, documents, assignments or instruments
related to such Policy except for those documents, assignments, and instruments that constitute and were included in the related
Collateral Package that was delivered to the Administrative Agent and such Collateral Package contains, at the very least, the
documents set forth in Exhibit M to the Account Control Agreement.

 

(p)Accuracy
of Information. To the best of the Borrower’s knowledge and belief, after due inquiry, and in reliance on information
provided by third parties, all information furnished by, or on behalf of, the Borrower to the Administrative Agent or any other
Secured Party in connection with any Transaction Document, or any transaction contemplated thereby, is or was as of the date it
was furnished (if such information was furnished on an earlier date) true and accurate in every material respect (without omission
of any information necessary to prevent such information from being materially misleading).

 

(q)No
Material Adverse Change. Since the Borrower’s formation, there has been no material adverse change in (A) the Borrower’s
(i) financial condition, business or operations or (ii) ability to perform its obligations under any Transaction Document to which
the Borrower is a party or (B) any of the Collateral.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 35 of 64	 

     

    

 

(r)Trade
Names and Subsidiaries. The Borrower has not used any other names, trade names or assumed names for the five year period preceding
the date of this Loan Agreement. The Borrower has no Subsidiaries nor owns or holds, directly or indirectly, any equity interest
in any Person.

 

(s)Accounts.
Set forth in Schedule 8.1(s) is a complete and accurate description, as of the Closing Date, of the existing Accounts, the Policy
Account and the Borrower Account. The Accounts and the Policy Account have each been validly and effectively assigned to the Administrative
Agent, for the benefit of the Secured Parties, and shall be encumbered by the Lien created pursuant to this Loan Agreement and
the Account Control Agreement. The Account Control Agreement is the legal, valid and binding obligation of the parties thereto,
enforceable against such parties in accordance with its terms (except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar law affecting creditors’ rights generally and by general principles of
equity). Neither the Borrower nor the Servicer has granted any interest in any of the Accounts or the Policy Account to any Person
other than the Administrative Agent and the Administrative Agent has “control” of the Accounts and the Policy Account
within the meaning of the applicable UCC.

 

(t)Financial
Statements. The financial statements required to be delivered pursuant to Section 9.1(d): (i) were, as of the date
and for the periods referred to therein, complete and correct in all material respects, (ii) presented fairly the financial condition
and results of operations of the related Person as at such time and (iii) were prepared in accordance with GAAP, consistently
applied, except as noted therein (subject as to interim statements to normal year-end adjustments).

 

(u)No
Event of Default. No Event of Default or Unmatured Event of Default has occurred or is continuing, or, in relation to any
Borrowing Request, will result from the funding of the Advance and use of funds specified therein.

 

(v)Foreign
Assets Control Regulations, Etc.

 

(i)Neither
the Borrower nor the Servicer nor any Affiliate of any of them is (A) a person whose name appears on the list of Specially Designated
Nationals and Blocked Persons published by the Office of Foreign Assets Control, U.S. Department of Treasury (“OFAC”)
(an “OFAC Listed Person”) or (B) a department, agency or instrumentality of, or is otherwise controlled by
or acting on behalf of, directly or indirectly, (x) any OFAC Listed Person or (y) any person, entity, organization, foreign country
or regime that is subject to any OFAC Sanctions Program (each OFAC Listed Person and each other person, entity, organization and
government of a country described in clause (B), a “Blocked Person”).

 

(ii)No
part of the proceeds from the Advances issued hereunder constitutes or will constitute funds obtained on behalf of any Blocked
Person or will otherwise be used, directly by the Borrower or indirectly by the Borrower, the Servicer, the Parent or any Affiliate
of any of them in connection with any investment in, or, to the Borrower’s actual knowledge, any transactions or dealings
with, any Blocked Person.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 36 of 64	 

     

    

 

(iii)To
the Borrower’s actual knowledge, none of the Borrower, the Parent, the Servicer or any Affiliate of any of them (A) is under
investigation by any Governmental Authority for, or has been charged with, or convicted of, money laundering, drug trafficking,
terrorist-related activities or other money laundering predicate crimes under any Applicable Law (collectively, “Anti-Money
Laundering Laws”), (B) has been assessed civil penalties under any Anti-Money Laundering Laws or (C) has had any of
its funds seized or forfeited in an action under any Anti-Money Laundering Laws. The Borrower has taken reasonable measures appropriate
to the circumstances, to the extent, if any, required by Applicable Law, to ensure that the Borrower and each Affiliate thereof
is and will continue to be in compliance with all applicable current and future Anti-Money Laundering Laws.

 

(iv)No
part of the proceeds from Advances funded hereunder will be used, directly or indirectly, for any improper payments to any governmental
official or employee, political party, official of a political party, candidate for political office, official of any public international
organization or anyone else acting in an official capacity, in order to obtain, retain or direct business or obtain any improper
advantage. The Borrower has taken reasonable measures appropriate to the circumstances, to the extent, if any, required by Applicable
Law, to ensure that the Borrower and each Affiliate thereof is and will continue to be in compliance with all applicable current
and future anti-corruption laws and regulations.

 

(w)Transaction
Documents. The Borrower has not entered into any agreements or instruments other than the Transaction Documents. Since the
date of its formation, the Borrower has not engaged in any activities except as those expressly permitted by the LLC Agreement
and the other Transaction Documents.

 

(x)Retained
Death Benefit Policies.  As of each Advance Date, all Pledged Policies that constitute Retained Death Benefit Policies
are listed on Schedule 8.1(x) and, except as set forth on Schedule 8.1(x), the portion of the Net Death Benefit
payable to any Person other than the Securities Intermediary does not exceed fifteen percent (15%) of the Net Death Benefit of
any such Retained Death Benefit Policy. 

 

ARTICLE
IX

COVENANTS

 

Section
9.1Affirmative Covenants. From the date hereof until the first day following the date on which all of the Obligations
are performed and paid in full and this Loan Agreement is terminated, the Borrower hereby covenants and agrees as follows:

 

(a)Compliance
with Laws, Etc. The Borrower shall comply in all material respects with all Applicable Laws.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 37 of 64	 

     

    

 

(b)Preservation
of Existence. The Borrower shall preserve and maintain its existence, rights, franchises and privileges, and sole jurisdiction
of formation, and qualify and remain qualified in good standing as a foreign entity in each jurisdiction where the failure to
preserve and maintain such existence, rights, franchises, privileges and qualifications could have an adverse effect on any of
the Pledged Policies, any other Collateral, the business, assets, financial condition or operations of the Borrower or any of
the rights or interests of the Administrative Agent or any of the Lenders hereunder or under any other Transaction Document.

 

(c)Performance
and Compliance with the Transaction Documents and Pledged Policies. The Borrower shall timely and fully perform and comply
in all material respects with all provisions, obligations, covenants and other promises required to be observed by it under the
Transaction Documents and otherwise with respect to the Pledged Policies.

 

(d)Reporting
Requirements. During the term of this Loan Agreement, the Borrower shall furnish or cause to be furnished to the Administrative
Agent and each Lender:

 

(i)
(x) as soon as available and in any event within forty-five (45) days after the end of each of the first three fiscal quarters
of each fiscal year of the Borrower, a copy of the unaudited financial statements of the Borrower or the Parent (so long as such
unaudited financial statements are on a consolidated basis and include the Borrower), as of the end of such fiscal quarter, certified
by an officer or director of the Borrower, the Parent or their investment manager (which certification shall state that the related
balance sheets and statements fairly present the financial condition and results of operations for such fiscal quarter), delivery
of which financial statements shall be accompanied by a certificate of such officer or director to the effect that no Event of
Default or Unmatured Event of Default has occurred and is continuing or, if an Event of Default or Unmatured Event of Default
has occurred and is continuing, specifying the details thereof and any action taken or proposed to be taken with respect thereto
and (y) as soon as available, and in any event within ninety (90) days after the end of each fiscal year of the Borrower (commencing
with the fiscal year ending in 2016), a copy of the audited annual balance sheet for such fiscal year of the Borrower or the Parent
(so long as such audited annual balance sheet is on a consolidated basis and includes the Borrower), as at the end of such fiscal
year, together with the related audited statements of earnings, stockholders’ equity and cash flows for such fiscal year,
certified by an officer or director of the Borrower or the Parent (which certification shall state that the related balance sheets
and statements fairly present the financial condition and results of operations for such fiscal year, subject to year-end audit
adjustments), delivery of which balance sheets and statements shall be accompanied by a certificate of such officer or Director
to the effect that no Event of Default or Unmatured Event of Default has occurred and is continuing;

 

(ii)as
soon as possible and in any event within three (3) Business Days after any officer of the Borrower or the Parent has actual knowledge
of (A) the occurrence of an Event of Default or an Unmatured Event of Default, an officer’s certificate of the Borrower
setting forth details of such event and the action that the Borrower proposes to take with respect thereto and (B) the downgrade,
withdrawal or suspension of the financial strength rating of any Issuing Insurance Company, notice to the Administrative Agent
thereof;

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 38 of 64	 

     

    

 

(iii)a
copy of the Servicer Report on each Servicer Report Date;

 

(iv)promptly,
from time to time, such other information, documents, records or reports respecting the Collateral, the Subject Policies or the
condition or operations, financial or otherwise, of the Borrower as the Administrative Agent may from time to time reasonably
request in order to protect the interests of the Administrative Agent or any Lender under or as contemplated by this Loan Agreement
and the other Transaction Documents, including but not limited to, upon each sale of a Pledged Policy, a report that shall include
such information as the Administrative Agent shall reasonably request, calculated as of before such sale and after such sale,
taking into account the application of the proceeds of such sale;

 

(v)as
soon as possible upon learning of the death of any Insured, an email notification to the Administrative Agent of (A) the identity
of such Insured, (B) the cost basis of the Pledged Policy relating to such Insured (purchase price paid by the first person that
purchased such Pledged Policy that was an Affiliate of the Borrower or the Parent, or, if such Pledged Policy was acquired by
such Affiliate in a foreclosure process, the amount of indebtedness allocated to such Pledged Policy by such Affiliate plus any
additional accrued and unpaid interest thereon as of the date of foreclosure and, in each case, plus premiums paid thereon after
the date of foreclosure or purchase, as applicable, and until the date of the death of such Insured), (C) the Net Death Benefit
of the Pledged Policy relating to such Insured, (D) the two (2) Life Expectancy Reports delivered with respect to such Insured
relating to the applicable Advance and the names of the Pre-Approved Medical Underwriters which provided such Life Expectancy
Reports (unless the related Pledged Policy is a Small Face Policy, in which case, the Life Expectancy Report delivered with respect
to such Insured relating to the applicable Advance and the name of the medical underwriter which provided such Life Expectancy
Report, which medical underwriter shall be AVS, Fasano or another medical underwriter approved by the Required Lenders in their
sole and absolute discretion), (E) the date the Pledged Policy was first acquired by an Affiliate of the Borrower or the Parent
relating to such Insured and (F) the date of birth and date of death of such Insured;

 

(vi)no
later than the Closing Date, and thereafter on December 1 of each calendar year (including the current calendar year), an annual
budget substantially in form of Exhibit E (each, an “Annual Budget”). Within five (5) Business Days
of delivery of the first such Annual Budget, and thereafter within twenty (20) Business Days of delivery of each subsequent Annual
Budget to the Administrative Agent and each Lender, the Required Lenders will specify to the Administrative Agent, and the Administrative
Agent will advise the Borrower the amount they have approved in their sole discretion for funding through Advances and/or Collections
in respect of Expenses and scheduled Premiums on the Pledged Policies for (a) in the case of the first such Annual Budget, the
current calendar year, and (b) in the case of any subsequent Annual Budget the succeeding calendar year; provided that at any
time, in their sole discretion, the Required Lenders may notify the Administrative Agent and Borrower that they approve increases
in such amounts or direct decreases in such amounts; and

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 39 of 64	 

     

    

 

(vii)to
the extent not prohibited by Applicable Law, within two (2) Business Days after receipt by the Borrower or any Affiliate thereof,
all notices, communications and other information (including medical information) related to a Pledged Policy or a related Insured.

 

(e)Use
of Advances. The Borrower shall use the proceeds of Advances in accordance with Section 2.8(a).

 

(f)Separate
Legal Entity. The Borrower hereby acknowledges that each Lender and the Administrative Agent are entering into the transactions
contemplated by this Loan Agreement and the other Transaction Documents in reliance upon the Borrower’s identity as a legal
entity separate from the members, shareholders or other equity owners of the Parent or any other Person. Therefore, from and after
the date hereof, the Borrower shall take all reasonable steps to continue the Borrower’s identity as a separate legal entity
and to make it apparent to third Persons that the Borrower is an entity with assets and liabilities distinct from those of any
other Person, and is not a division of any other Person. Without limiting the generality of the foregoing and in addition to and
consistent with the covenant set forth in Section 9.1(b), the Borrower shall take such actions as shall be required in
order that:

 

(i)The
Borrower will be a limited liability company whose primary activities are restricted in the Borrower Organizational Documents
to acquiring and owning Pledged Policies and financing the acquisition thereof pursuant to this Loan Agreement;

 

(ii)At
least one director of the Borrower (the “Independent Director”) shall be an individual who (i) is not a present
or former director, manager, officer, employee, supplier, customer or five percent (5%) beneficial owner of the outstanding common
stock of any Person or entity beneficially owning any outstanding shares of common stock or other equity interest of the Parent
or any Affiliate thereof and (ii) has at least three years of employment experience with one or more entities with a national
reputation and presence that provide, in the ordinary course of its business, advisory, management or placement services to issuers
of securitization or structured finance instruments, agreements or securities, and is currently employed by such an entity; provided,
however, that an individual shall not be deemed to be ineligible to be an Independent Director solely because such individual
serves or has served in the capacity of an “independent director” or similar capacity for special purpose entities
formed by the Borrower or any of its Affiliates. The Borrower Organizational Documents shall provide that (i) the board of directors
or the equity owners of the Borrower shall not approve, or take any other action to cause the filing of, a voluntary bankruptcy
petition with respect to the Borrower unless the Independent Director shall approve the taking of such action in writing prior
to the taking of such action, and (ii) such provision cannot be amended without the prior written consent of the Independent Director;

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 40 of 64	 

     

    

 

(iii)Any
employee, consultant or agent of the Borrower will be compensated from funds of the Borrower, as appropriate, for services provided
to the Borrower;

 

(iv)The
Borrower will allocate and charge fairly and reasonably overhead expenses shared with any other Person. To the extent, if any,
that the Borrower and any other Person share items of expenses such as legal, auditing and other professional services, such expenses
will be allocated to the extent practical on the basis of actual use or the value of services rendered, and otherwise on a basis
reasonably related to the actual use or the value of services rendered;

 

(v)The
Borrower shall hold itself out as a separate entity;

 

(vi)The
Borrower’s operating expenses will not be paid by any other Person except as permitted under the terms of this Loan Agreement;

 

(vii)The
Borrower’s books and records will be maintained separately from those of any other Person;

 

(viii)The
Borrower shall pay its own liabilities out of its own funds;

 

(ix)The
Borrower shall not acquire any obligations or securities of its partners or shareholders;

 

(x)All
audited financial statements of any Person that are consolidated to include the Borrower will contain notes clearly stating that
(A) all of the Borrower’s assets are owned by the Borrower, and (B) the Borrower is a separate entity;

 

(xi)The
Borrower’s assets will be maintained in a manner that facilitates their identification and segregation from those of any
other Person;

 

(xii)The
Borrower will strictly observe appropriate formalities in its dealings with all other Persons, and funds or other assets of the
Borrower will not be commingled with those of any other Person, other than temporary commingling in connection with servicing
the Pledged Policies to the extent explicitly permitted by the other Transaction Documents;

 

(xiii)The
Borrower shall not, directly or indirectly, be named or enter into an agreement to be named, as a direct or contingent beneficiary
or loss payee, under any insurance policy with respect to any amounts payable due to occurrences or events related to any other
Person other than, for avoidance of doubt, life insurance policies purchased by the Borrower for investment purposes and pledged
to the Administrative Agent and the Lenders hereunder;

 

(xiv)The
Borrower shall maintain an arm’s length relationship with its Affiliates;

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 41 of 64	 

     

    

 

(xv)Any
Person that renders or otherwise furnishes services to the Borrower will be compensated thereby at market rates for such services
it renders or otherwise furnishes thereto. The Borrower will not hold itself out to be responsible for the debts of any other
Person; and

 

(xvi)The
Borrower will maintain all policies and procedures or take or continue to take all actions necessary or appropriate to ensure
that all factual assumptions set forth in opinions of counsel of the Borrower or its Affiliates delivered in connection herewith
or the other Transaction Documents remain true and accurate at all times.

 

(g)Defense.
The Borrower shall, in consultation with the Administrative Agent and at the Borrower’s own expense, defend the Collateral
against all lawsuits and statutory claims and Liens of all Persons at any time claiming the same or any interest therein through
the Borrower or any Affiliate thereof adverse to the Administrative Agent or the Secured Parties.

 

(h)Perfection.
The Borrower shall, at the Borrower’s expense, perform all acts and execute all documents requested by the Administrative
Agent at any time to evidence, perfect, maintain and enforce the title or the security interest of the Administrative Agent in
the Collateral and the priority thereof. The Borrower will, at the reasonable request of the Administrative Agent, deliver financing
statements relating to the Collateral, and, where permitted by law, the Borrower hereby authorizes the Administrative Agent to
file one or more financing statements covering all of the Collateral and other assets of the Borrower. The Borrower shall cause
its primary electronic books and records relating to the Collateral to be marked, with a legend stating that the Pledged Policies
and the other Collateral owned by the Borrower have been pledged to the Administrative Agent, for the benefit of the Secured Parties.

 

(i)Audit.
The Borrower shall, and shall cause the Servicer, the Custodian and the Parent to, permit each Lender, the Administrative Agent
or their duly authorized representatives, attorneys or auditors during ordinary business hours and upon three (3) Business Days
written notice, to visit the offices thereof and to inspect the Collateral and the Collateral Packages, and the related accounts,
records and computer systems, software and programs used or maintained by the Borrower, the Servicer, the Parent or the Custodian,
as the case may be at such times as such Lender or the Administrative Agent may reasonably request, using auditors and/or accountants
selected by such Lender or the Administrative Agent in its sole and absolute discretion (a “Collateral Audit”)
and the Borrower shall enable the Insurance Consultant to seek and receive from the related Issuing Insurance Companies any verifications
of coverage related to the Pledged Policies as often as the Administrative Agent may request the Insurance Consultant to do so
(though not more frequently than once per month unless an Event of Default or Unmatured Event of Default has occurred and is continuing).
Unless an Event of Default or an Unmatured Event of Default has occurred and is continuing, a Collateral Audit under this Section
9.1(i) may be conducted not more frequently than once per month. The Borrower shall promptly on demand reimburse the Administrative
Agent and the Lenders for all costs and expenses incurred by or on behalf of the Administrative Agent and the Lenders in connection
with any Collateral Audit and their ongoing review and Insurance Consultant’s ongoing review of the documents related to
the Pledged Policies, including without limitation the documents on the FTP Site; provided, however, if no Event of Default or
Unmatured Event of Default has occurred and is continuing, no more than one Collateral Audit per year shall be at the expense
of the Borrower (all other Collateral Audits in a year being at the expense of the Lenders) and the total expenses incurred by
or on behalf of the Borrower related to a Collateral Audit (including any reimbursements actually made by the Borrower to the
Lenders and the Administrative Agent in connection with such Collateral Audit), a Servicer Collateral Audit, enabling the Insurance
Consultant to receive any verifications of coverage, information requests described in Section 9.1(cc) and audits conducted
pursuant to Section 13.8(a)(iv), in each case, excluding any internal and third-party costs and expenses incurred in the
ordinary course by or on behalf of the Borrower, shall be limited to no more than $2,200 for each Pledged Policy (or if such Pledged
Policy is a Small Face Policy and payment of Premiums in respect of such Pledged Policy are made on an annual basis, $1,400 for
each such Pledged Policy) (as adjusted annually for inflation or such higher amount if such higher amount is the Insurance Consultant’s
reasonably determined prevailing market cost in the industry for such Collateral Audits or ongoing reviews of the type in question
as adjusted for changes in audit standards) during the shorter of (i) the prior twelve (12) month period and (ii) the period of
time commencing on the most recent Advance Date and ending on the date of such Collateral Audit, verification of coverage, information
request or audit, as applicable. Upon instructions from the Administrative Agent, the Borrower shall, and shall cause the Servicer
(and the Administrative Agent may cause the Custodian) to release any document related to any Collateral to the Administrative
Agent. If an Event of Default or Unmatured Event of Default has occurred and is continuing, the Administrative Agent, at the Borrower’s
expense, shall have the right to conduct a Collateral Audit at any time and as often the Administrative Agent determines is necessary
or desirable. For the avoidance of doubt, any review and evaluation of Additional Policies conducted by the Administrative Agent
or the Lenders in connection with a Borrowing Request shall not constitute a Collateral Audit.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 42 of 64	 

     

    

 

(j)Additional
Assistance. The Borrower shall provide such cooperation, information and assistance, and prepare and supply the Administrative
Agent with such data regarding the performance by the Issuing Insurance Companies of their obligations under the Pledged Policies
and the performance by the Borrower of its obligations under the Transaction Documents, as may be reasonably requested by the
Administrative Agent from time to time.

 

(k)Accounts.
The Borrower shall not maintain any bank accounts other than the Accounts, the Policy Account and the Borrower Account. The Borrower
shall not close any of the Accounts or the Borrower Account unless the Required Lenders shall have consented thereto in their
sole and absolute discretion.

 

(l)Keeping
of Records and Books of Account. The Borrower shall maintain and implement administrative and operating procedures (including,
without limitation, an ability to recreate the documents relating to the Collateral in the event of the destruction thereof),
and keep and maintain all records and other information, reasonably necessary or reasonably advisable for the collection of proceeds
of the Pledged Policies.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 43 of 64	 

     

    

 

(m)Deposit
of the Collections. The Borrower shall deposit or cause to be deposited all Collections into the Collection Account or the
Administrative Agent’s Account, as applicable, in each case, in accordance with Section 5.1.

 

(n)Investment
Company Act. The Borrower shall ensure that none of the Borrower or the Parent shall become an “investment company”
or a company “controlled” by an “investment company” within the meaning of the Investment Company Act
of 1940, as amended, by virtue of an exemption other than pursuant to Section 3(c)(1) or Section 3(c)(7) thereof. The Borrower
shall take any and all actions to ensure that it is not a “covered fund” under Section 13 of the Bank Holding Company
Act of 1956, as amended.

 

(o)Borrower
Residence. The Borrower shall at all times maintain its registered office in Delaware and its head office in Minnesota. The
Borrower shall at all times maintain its principal place of business in Minnesota.

 

(p)Payment
of Taxes. The Borrower shall pay and discharge, as they become due, all Taxes lawfully imposed upon it or incurred by it or
its properties and assets, including, without limitation, lawful claims for labor, materials and supplies which, if unpaid might
become a Lien or a charge upon any of the assets of the Borrower, including, without limitation, the Collateral, provided, however,
that the Borrower shall have the right to contest any such taxes, assessments, debts, claims and other charges in good faith so
long as adequate reserves are maintained in accordance with GAAP.

 

(q)Errors
and Omissions. The Borrower shall maintain, at its own expense, an errors and omissions policy, each with insurance companies
rated A-, VII or higher by A.M. Best on all officers, employees or other Persons where the Borrower has the right to direct
and control such individuals in any capacity with regard to the Pledged Policies to handle documents and papers related thereto.
Each such policy shall insure against losses resulting from the errors, omissions and negligent acts of such officers, employees
and other persons and shall be maintained in an amount of at least $2,000,000 or such lower amount as the Administrative Agent
may designate in writing to the Borrower from time to time, and in a form reasonably acceptable to the Administrative Agent and
naming the Administrative Agent on behalf of the Lenders as an additional loss payee. No provision of this Section 9.1(q) requiring
such errors and omissions policy shall diminish or relieve the Borrower from its duties and obligations as set forth in this Loan
Agreement. Upon the request of the Administrative Agent at any time subsequent to the Closing Date, the Borrower shall cause to
be delivered to the Administrative Agent a certification evidencing the Borrower's coverage under such errors and omissions policy.
Any such insurance policy shall contain a provision or endorsement providing that such policy may not be canceled or modified
in a materially adverse manner without ten (10) days' prior written notice to the Administrative Agent.

 

(r)Pledged
Policies. The Borrower shall maintain the Pledged Policies in full force and effect and if any Pledged Policy enters a “grace
period”, the Borrower shall pay all Premiums due and payable with respect to such Pledged Policy and shall restore such
Pledged Policy to good standing, in each case, within six (6) Business Days after the start of such “grace period”.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 44 of 64	 

     

    

 

(s)Further
Assurances. The Borrower shall procure and deliver to the Administrative Agent and/or execute any security agreement, financing
statement or other writing requested by the Administrative Agent to evidence, preserve, protect or enforce the Secured Parties’
rights and interests to or in the Collateral or in any other collateral agreed to by the parties.

 

(t)Litigation.
The Borrower shall promptly notify the Administrative Agent of:

 

(i)any
litigation, administrative proceedings, audits, actions, proceedings, claims or investigations pending or threatened in writing,
conducted or to be conducted by any Person or Governmental Authority, actions, proceedings, claims or investigations pending or
threatened in writing against the Borrower or the entry of any judgment against the Borrower, which in each case could reasonably
be expected to involve or create a liability of the Borrower which exceeds $25,000 per incident or $100,000 in the aggregate,
whether or not insured against;

 

(ii)the
entry of any judgment against the Borrower or the creation of any Lien against any of the Collateral;

 

(iii)any
actual or alleged violation by the Borrower of any Applicable Law which could reasonably be expected to have an adverse effect
on any of the Pledged Policies, the business, assets, financial condition or operations of the Borrower or any of the rights or
interests of the Administrative Agent or any of the Lenders hereunder or under any other Transaction Document; and

 

(iv)any
pending or threatened litigation dispute or similar matter relating to any Pledged Policy or any other Policy owned by an Affiliate
of the Borrower that was originated in a similar manner or under a similar origination or financing program as a Pledged Policy.

 

(u)Loan
Administration Fee, Undrawn Fee. The Borrower shall pay the Loan Administration Fee for the following calendar year on the
last Distribution Date of each calendar year. The Borrower shall pay the related Undrawn Fee on each Distribution Date.

 

(v)Insured
Consent. The Borrower shall use, or shall cause the Servicer to use, commercially reasonable efforts to cause each Insured
with respect to a Pledged Policy to consent to the release and delivery of its current and historical medical information and
death certificate.

 

(w)Servicer
Documents. The Borrower shall cause the Servicer, at the request of the Administrative Agent, to provide to the Administrative
Agent all information and documentation in the possession of the Servicer with respect to the Pledged Policies and the related
Insureds.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 45 of 64	 

     

    

 

(x)Schedule
of Premiums. The Borrower shall cause the Servicer to provide a schedule of Premiums due during the following twelve (12)
month period on or prior to the Calculation Date with respect to each Distribution Date.

 

(y)In-Force
Policy Illustrations. With respect to each Pledged Policy, for each calendar year, the Borrower shall use commercially reasonable
efforts to cause the applicable Issuing Insurance Company to deliver to the Administrative Agent an in-force Policy Illustration
in respect of such Pledged Policy no later than sixty (60) calendar days after the anniversary date of such Pledged Policy.

 

(z)Cooperation.
The Borrower shall assist the Administrative Agent with, and take all actions reasonably requested by the Administrative Agent
in connection with, the engagement of servicers, medical underwriters and tracking agents and the enabling of such parties to
perform the services for which they have been retained by the Administrative Agent relating to the Pledged Policies.

 

(aa)Collateral
Assignment. Prior to each Advance Date, the Borrower shall permit the Insurance Consultant to submit each collateral assignment
in respect of each Policy pledged on such Advance Date to the applicable Issuing Insurance Company, naming the Administrative
Agent, on behalf of the Lenders, as the collateral assignee. The Borrower shall take any and all actions necessary to ensure that
each such Issuing Insurance Company acknowledges such collateral assignment as soon as practical after such Advance Date.

 

(bb)Other
Information. The Borrower shall use commercially reasonable efforts to obtain any other information reasonably requested by
the Administrative Agent with respect to the Pledged Policies and the Insureds.

 

(cc)Transaction
Documents. The Borrower shall duly and timely perform all of its covenants and obligations under all Transaction Documents,
except with the prior written consent of the Administrative Agent.

 

(dd)Purchase
Agreement. The Borrower shall enforce each of the Parent Obligations promptly, but in any event, within three (3) Business
Days of (a) if the applicable provisions of the Purchase Agreement provide for a specified cure period for such Parent Obligations,
the date of the expiration of such specified cure period and (b) if the applicable provisions of the Purchase Agreement do not
provide for a specified cure period for such Parent Obligations, the earlier of (i) the date on which such Parent Obligations
which have not been performed have first become due and (ii) the date on which the Administrative Agent provides instruction to
the Borrower to enforce such Parent Obligations.

 

(ee)Servicing
Agreement. The Borrower shall enforce each of the Servicing Agreement Obligations and the Servicing Agreement Rights promptly,
but in any event, within three (3) Business Days of (a) in the case of any Servicing Agreement Obligations, (i) if the applicable
provisions of the Servicing Agreement provide for a specified cure period for such Servicing Agreement Obligations, the date of
the expiration of such specified cure period and (ii) if the applicable provisions of the Servicing Agreement do not provide for
a specified cure period for such Servicing Agreement Obligations, the earlier of (x) the date on which such Servicing Agreement
Obligations which have not been performed have first become due and (y) the date on which the Administrative Agent provides instruction
to the Borrower to enforce such Servicing Agreement Obligations and (b) in the case of such Servicing Agreement Rights, the date
on which the Borrower becomes aware that such Servicing Agreement Rights are enforceable.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 46 of 64	 

     

    

 

Section
9.2Negative Covenants. From the date hereof until the first day following the date on which all of the Obligations
are performed and paid in full and this Loan Agreement is terminated, the Borrower hereby covenants and agrees that it shall not:

 

(a)Assignment
of Pledged Policies, Etc. Except in connection with a Permissible Sale, sell, assign (by operation of law or otherwise) or
otherwise dispose of, or create or suffer to exist, any Adverse Claim upon or with respect to, any of the Pledged Policies or
any other Collateral, including, without limitation, any Adverse Claim arising out of a Policy Loan.

 

(b)Amendments
to Transaction Documents, etc. Amend, otherwise modify or waive any term or condition of (i) any Transaction Document or any
Pledged Policy, except in each case with the prior written consent of the Required Lenders in their sole and absolute discretion
or (ii) the Borrower Organizational Documents or any other material contract other than any Transaction Document or any Pledged
Policy, except in each case with the prior written consent of the Required Lenders, such consent not to be unreasonably withheld.

 

(c)Deposit
of Non-Collections. Deposit or otherwise credit, or cause or permit to be so deposited or credited, to the Collection Account
any cash proceeds or other assets other than Collections and other amounts allowed or required to be credited to the Collection
Account in accordance with Section 5.2.

 

(d)Indebtedness.
Contract, create, incur or assume any indebtedness other than indebtedness incurred pursuant to this Loan Agreement and the other
Transaction Documents.

 

(e)Change
of Accounts. Change or cause to be changed any of the Accounts, the Policy Account, the Borrower Account or amend the Account
Control Agreement without prior written consent of the Required Lenders.

 

(f)Mergers,
Acquisitions, Sales, Subsidiaries, etc.

 

(i)Be
acquired directly or indirectly or be a party to any merger or consolidation, or directly or indirectly purchase or otherwise
acquire all or substantially all of the assets or any stock of any class of, or any partnership or joint venture interest in,
any other Person, except for Permitted Investments or sell, transfer, assign, convey or lease any of its property and assets (or
any interest therein) other than in connection with a Permissible Sale;

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 47 of 64	 

     

    

 

(ii)make,
incur or suffer to exist an Investment in, equity contribution to, loan or advance to, or payment obligation in respect of the
deferred purchase price of, or payment for, property from, any other Person, except for Permitted Investments, pursuant to the
Transaction Documents;

 

(iii)create
any direct or indirect Subsidiary or otherwise acquire direct or indirect ownership of any equity interests in any other Person
other than pursuant to the Transaction Documents; or

 

(iv)enter
into any transaction with any Affiliate of the Borrower, the Servicer or any Affiliate of any of them except for the transactions
contemplated or permitted by the Transaction Documents and other transactions upon fair and reasonable terms materially no less
favorable to the Borrower than would be obtained in a comparable arm’s length transaction with a Person not an Affiliate
of the Borrower or the Servicer.

 

(g)Change
in Business Policy. Make any change in the character of its business.

 

(h)Chief
Executive Office. Move its chief executive office or jurisdiction of formation or its situs or permit the documents and books
evidencing the Collateral to be moved unless (i) the Borrower shall have given to the Administrative Agent not less than thirty
(30) days’ prior written notice thereof, clearly describing the new location, and (ii) the Borrower shall have taken such
action, satisfactory to the Administrative Agent, to maintain the title or ownership of the Borrower and any security interest
of the Administrative Agent, in the Collateral at all times fully perfected and first priority (subject to no Adverse Claims)
and in full force and effect. The Borrower shall not in any event become or seek to become organized under the laws of more than
one jurisdiction.

 

(i)Business
Restrictions. Engage in any business or transactions, or be a party to any documents, agreements or instruments, other than
the Transaction Documents or those incidental to the purposes thereof, or make any expenditure for the purchase of any assets
if such expenditure is made by the Borrower through a withdrawal of funds from an Account.

 

(j)Sale
of Assets. Sell, transfer or convey any assets, except in connection with a Permissible Sale.

 

(k)Independent
Director. Remove, replace or seek to replace its Independent Director absent due cause and the express consent of the Administrative
Agent and the Required Lenders, provided, however, that no such consent shall be required for the replacement of an Independent
Director in the event that such Independent Director ceases to meet the qualifications set forth in Section 9.1(f)(ii),
and such Independent Director is replaced by another employee of the Corporate Services Provider meeting all of the qualifications
set forth in Section 9.1(f)(ii).

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 48 of 64	 

     

    

 

(l)Further
Policy Acquisitions. Acquire at any time any additional Policies without the prior written consent of the Administrative Agent.

 

(m)Use
of Funds/Proceeds. Without the prior written consent of the Administrative Agent, use the funds in the Reserve Account or
any proceeds arising from a sale under Section 2.7 other than pursuant to this Loan Agreement.

 

(n)Accounting
Changes. Change any accounting practices, policies or treatment without the prior written consent of the Administrative Agent.

 

(o)Foreign
Assets Control Regulations, Etc. (i) Become or permit any of its Affiliated Entities to become a Blocked Person, (ii) have
or permit any of its Affiliated Entities to have any investments in or engage in any dealings or transactions with any Blocked
Person or (iii) violate or permit any of its Affiliated Entities to violate any Anti-Money Laundering Law.

 

(p)Amendments
to Certain Documents. Permit any amendment or other modification or waiver to any term or condition set forth in (i) the GWG
Holdings Indenture, (ii) any Collateral Document (as defined in the GWG Holdings Indenture), (iii) the GWG Note Issuance and Security
Agreement or (iv) any other document or agreement pursuant to which the Parent pledges or purports to pledge or that is secured
by the Parent’s membership interests in the Borrower or any of the Collateral, except in each case, with the prior written
consent of the Required Lenders in their sole and absolute discretion.

 

ARTICLE
X

EVENTS OF DEFAULT; REMEDIES

 

Section
10.1Events of Default. Each of the following shall constitute an “Event of Default” under this Loan Agreement,
unless the Required Lenders in their sole and absolute discretion shall deliver a Cure Notice to the Borrower, in which
case each of the following shall constitute an Event of Default only upon (i) the expiration of the time period set forth in such
Cure Notice or (ii) the earlier revocation of such Cure Notice by the Required Lenders in their sole and absolute discretion:

 

(a)Non-Payment.
(A) The Borrower shall (i) fail to make when due any payment to any Lender or the Administrative Agent or deposit to any of the
Accounts to be made by it under this Loan Agreement or any other Transaction Document when due, which failure shall have continued
for three (3) Business Days or (ii) fail to make when due, any payment to any Person under this Loan Agreement or any other Transaction
Document, including, without limitation, the failure to pay any Premium, which failure shall have continued for ten (10) Business
Days, or (B) any Advance is not paid in full on the Maturity Date. For the avoidance of doubt, the Lenders making one or more
Protective Advances to pay any Premiums due during such ten (10) Business Day period shall not constitute a cure of the related
Event of Default.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 49 of 64	 

     

    

 

(b)Breach
of Representations and Warranties. Any representation or warranty made or deemed made by the Borrower or the Parent under
or in connection with any Transaction Document to which it is a party or any information or report delivered by or on behalf of
any such Person to the Administrative Agent or any Lender hereunder or under any other Transaction Document shall prove to have
been incorrect or untrue in any material respect when made or delivered (or when such representation, warranty, information or
report is deemed to have been made or delivered), and such failure remains unremedied for thirty (30) days.

 

(c)Non-Compliance
with Other Provisions. Except as otherwise provided in this Section 10.1, (i) the Borrower shall fail to perform or
observe any covenant or agreement set forth in Section 9.1(n), Section 9.1(p), Section 9.1(v) or Section
9.2 (other than Section 9.2(c)), (ii) the Borrower shall fail to perform or observe any covenant or agreement in Section
9.1(cc), Section 9.1(d)(vii), Section 9.1(dd) or Section 9.1(ee) and any such failure described in this
clause (ii) shall remain unremedied for three (3) Business Days or (iii) the Borrower or the Parent shall fail to perform or observe
any other term, covenant or agreement contained in any Transaction Document to which it is party on its part to be performed or
observed and any such failure described in this clause (iii) shall remain unremedied for thirty (30) days (or, with respect to
a failure to deliver the Calculation Date Report or a failure to comply with any of Section 2.7, Section 9.1(b),
Section 9.1(e), Section 9.1(f), Section 9.1(h), Section 9.1(i), Section 9.1(m) or Section
9.2(c), such failure shall remain unremedied for five (5) Business Days).

 

(d)Non-Compliance
by Other Parties. Any party to any Transaction Document other than the Borrower, the Parent, the Lenders or the Administrative
Agent shall fail to perform or observe any term, covenant or agreement contained in this Loan Agreement or in any other Transaction
Document on its part to be performed or observed and any such failure shall remain unremedied for thirty (30) days (or, with respect
to a failure by such party to make a payment or cause a payment to be made, such failure shall be unremedied for (i) if such failure
relates to the payment of amounts to any Lender or the Administrative Agent or to the deposit of any amounts to the Accounts pursuant
to this Loan Agreement or any other Transaction Document, one (1) Business Day or (ii) if such failure relates to the payment
of amounts to any other Person, ten (10) Business Days from the earlier of the (i) the date such Person receives notice of such
failure and (ii) the date such Person has actual knowledge thereof); provided that the Borrower and/or the Parent may remedy such
failure by performing or causing to be performed such action in place of such party prior to the expiration of the applicable
cure period.

 

(e)Validity
of Transaction Documents. (i) This Loan Agreement or any other Transaction Document shall (except in accordance with its terms),
in whole or in part, cease to be the legally valid, binding and enforceable obligation of the Borrower or the Parent, or cease
to be in full force and effect, (ii) the Borrower or the Parent, shall directly or indirectly contest in any manner such effectiveness,
validity, binding nature or enforceability of such document, (iii) any other party (other than any of the Lenders, the Administrative
Agent or any other Affected Party) shall directly or indirectly contest such effectiveness, validity, binding nature or enforceability
of such document or (iv) this Loan Agreement together with the Account Control Agreement shall cease to create a valid Lien in
favor of the Administrative Agent in the Collateral, or the Lien of the Administrative Agent in the Collateral shall cease to
be a valid and enforceable first priority perfected Lien, free and clear of any Adverse Claim.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 50 of 64	 

     

    

 

(f)Bankruptcy.
An Event of Bankruptcy shall have occurred with respect to the Borrower or the Parent.

 

(g)Change
in Control. A Change in Control shall have occurred with respect to the Borrower or the Parent.

 

(h)Tax
Liens; ERISA Liens. The Internal Revenue Service shall file notice of a Lien pursuant to the Code with regard to any assets
of the Borrower or the Parent, or the PBGC shall, or shall indicate its intention to, file notice of a Lien pursuant to Section
4068 of ERISA with regard to any of the assets of the Borrower or the Parent in excess of $100,000; provided, however, that in
each case the filing of such a notice of Lien shall not be an Event of Default for so long as such filing is being contested in
good faith by appropriate proceedings and with respect to which adequate reserves have been set aside. Notwithstanding anything
provided in the preceding sentence, no Adverse Claim shall be permitted with respect to any Collateral.

 

(i)Defaults.
A default by the Borrower (after giving effect to the applicable grace period) shall have occurred and be continuing under any
instrument, agreement or legal commitment evidencing, securing or providing for indebtedness, following which the provider or
holder of such indebtedness has the right to accelerate the maturity thereof.

 

(j)Monetary
Judgment. One or more judgments for the payment of money in an aggregate amount in excess of $50,000 shall be rendered against
the Borrower, and shall remain unpaid or undischarged, or a stay of execution thereof shall not be obtained, within thirty (30)
days from the date of entry thereof.

 

(k)Material
Adverse Effect. An event has occurred that has had or could reasonably be expected to have a Material Adverse Effect.

 

(l)Servicer
Termination Events. (i) A Servicer Termination Event shall have occurred and be continuing, but only if the Servicer has not
been replaced by a Successor Servicer in accordance with the terms and conditions of the Servicing Agreement or if such Servicer
Termination Event causes a Material Adverse Effect or (ii) regardless of whether a Servicer Termination Event shall have occurred
or be continuing, the Servicer shall fail to perform or observe any term, covenant or agreement contained in any Transaction Document
to which it is party on its part to be performed or observed or any representation or warranty made or deemed made by the Servicer
under or in connection with any Transaction Document to which it is a party or any information or report delivered by or on behalf
of the Servicer to the Administrative Agent or any Lender under the Servicing Agreement or under any other Transaction Document
shall prove to have been incorrect or untrue in any material respect when made or delivered (or when such representation, warranty,
information or report is deemed to have been made or delivered) and, in each case, such failure or incorrect or untrue representation,
warranty, information or report has a material adverse effect on the validity, enforceability, collectability, Lender Valuation
or Net Death Benefit of one or more Pledged Policies.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 51 of 64	 

     

    

 

(m)Investment
Company Act. (i) The Borrower or the Parent shall become an “investment company” or a company “controlled”
by an “investment company” within the meaning of the Investment Company Act of 1940, as amended, or any of the foregoing
is at any time not an “investment company” or a company “controlled” by an “investment company”
within the meaning of the Investment Company Act of 1940, as amended, solely by virtue of an exception pursuant to Section 3(c)(1)
or 3(c)(7) thereof or (ii) the Issuer shall become a “covered fund” under Section 13 of the Bank Holding Company
Act of 1956, as amended.

 

(n)Organizational
Document Amendments. The Borrower shall make any material amendment to any of the Borrower Organizational Documents without
the prior written consent of the Required Lenders, such consent not to be unreasonably withheld.

 

(o)Subject
Policy Grace Period. Any Pledged Policy enters a “grace period” and is not restored to good standing within ten
(10) Business Days after the start of such “grace period”; provided, however, that any Pledged Policy may be permitted
to lapse with the prior written consent of the Required Lenders, in their sole and absolute discretion.

 

(p)Second
Initial Advance. (i) Within five (5) Business Days after the Closing Date, with respect to each Policy that will become a
Pledged Policy upon the making of the Second Initial Advance, (a) the Borrower or the Parent has failed to submit completed Change
Forms to the related Issuing Insurance Company, which Change Forms designate the Securities Intermediary as the new owner and
beneficiary of such Policy, or (b) the Borrower has failed to deliver a fully executed entitlement order to the Securities Intermediary,
which entitlement order credits such Policy to the Policy Account, (ii) within forty-five (45) days after the Closing Date, the
Second Initial Advance is not made, (iii) the number of Subject Policies related to the Second Initial Advance is less than 140
or such Subject Policies insure the lives of less than 133 distinct Insureds or (iv) within five (5) Business Days after the date
on which any of the Borrower, the Securities Intermediary or the Administrative Agent has received an Acknowledgement for each
Policy that will become a Pledged Policy upon the making of the Second Initial Advance, the Borrower has failed to deliver a Borrowing
Request in respect of the Second Initial Advance to the Administrative Agent pursuant to Section 2.3(b) of this Loan Agreement.

 

Section
10.2Remedies.

 

(a)Optional
Termination. Upon the occurrence and during the continuance of an Event of Default (other than an Event of Default described
in Section 10.1(f)), the Administrative Agent may, and at the request of the Required Lenders shall, by notice to the Borrower,
declare the Advances and other Obligations to be due and payable and the Lenders’ Commitments (if not theretofore terminated)
to be terminated, whereupon the full unpaid amount of all the Advances and other Obligations (including, without limitation, any
Yield Maintenance Fees payable pursuant to Section 4.2) shall be and become immediately due and payable (and the Maturity
Date shall be deemed to have occurred), without further notice, demand or presentment, and the Lenders’ Commitments shall
terminate.

 

(b)Automatic
Termination. Upon the occurrence of an Event of Default described in Section 10.1(f), the Lenders’ Commitments
shall be deemed to have been terminated automatically and all outstanding Advances and other Obligations (including, without limitation,
any Yield Maintenance Fees payable pursuant to Section 4.2) shall become immediately and automatically due and payable
(and the Maturity Date shall be deemed to have occurred for all of the Advances), all without presentment, demand, protest, or
notice of any kind.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 52 of 64	 

     

    

 

(c)[Reserved.]

 

(d)Additional
Rights and Remedies. In addition to all rights and remedies under this Loan Agreement or otherwise, the Lenders and the Administrative
Agent shall have all other rights and remedies provided under the relevant UCC and under other Applicable Laws, which rights shall
be cumulative. Without limiting the generality of the foregoing, on and after the occurrence of an Event of Default, the Administrative
Agent (on behalf of the Secured Parties and at the direction of the Required Lenders) may without being required to give any notice
(except as herein provided or as may be required by mandatory provisions of law), sell the Collateral or any part thereof in any
commercially reasonable manner at public or private sale, for cash, upon credit or for future delivery, as directed by the Required
Lenders, and at such price or prices as the Required Lenders, may deem satisfactory. Any Lender or the Administrative Agent may
participate as a bidder in any such sale and the Administrative Agent may credit bid in such sale. The Borrower will execute and
deliver such documents and take such other action as the Administrative Agent reasonably deems necessary or advisable in order
that any such sale may be made in compliance with Applicable Law. Upon any such sale, the Administrative Agent shall have the
right to deliver, assign and transfer to the purchaser thereof the Collateral so sold. Each purchaser at any such sale shall hold
the Collateral so sold to it absolutely and free from any claim or right of whatsoever kind, including any equity or right of
redemption of the Borrower which may be waived, and the Borrower, to the extent permitted by Applicable Law, hereby specifically
waives all rights of redemption, stay or appraisal which it has or may have under any law now existing or hereafter adopted. The
Administrative Agent at the direction of the Required Lenders, instead of exercising the power of sale herein conferred upon it,
may proceed by a suit or suits at law or in equity to foreclose the security interests in the Collateral and sell the Collateral,
or any portion thereof, under a judgment or decree of a court or courts of competent jurisdiction.

 

(e)Power
of Attorney. In furtherance of the rights, powers and remedies of the Administrative Agent and the Lenders, on and after the
occurrence of an Event of Default, the Borrower hereby irrevocably appoints the Administrative Agent, its true and lawful attorney,
which appointment is coupled with an interest and is irrevocable, with full power of substitution, in the name of the Borrower,
or otherwise, for the sole use and benefit of the Administrative Agent (for the further benefit of the Secured Parties), but at
the Borrower’s expense, to the extent permitted by law and subject to the last sentence of the immediately preceding subsection,
to exercise, at any time and from time to time during the continuance of an Event of Default, all or any of the following powers
with respect to all or any of the Collateral:

 

(i)to
demand, sue for, collect, receive and give acquittance for any and all monies due or to become due thereon or by virtue thereof,

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 53 of 64	 

     

    

 

(ii)to
settle, compromise, compound, prosecute or defend any action or proceeding with respect thereto,

 

(iii)to
sell, transfer, assign, seize or otherwise deal in or with the Collateral or the proceeds or avails thereof, as fully and effectually
as if the Administrative Agent was the absolute owner thereof, and

 

(iv)to
extend the time of payment of any or all thereof and to make any allowance and other adjustments with reference thereto;

 

provided
that the Administrative Agent shall give the Borrower at least ten (10) days’ prior written notice of the time and place
of any public sale or the time after which any private sale or other intended disposition of any of the Collateral is to be made.
The Borrower agrees that such notice constitutes “reasonable notification” within the meaning of Section 9-611 (or
other section of similar content) of the relevant UCC.

 

(f)Conflict
of Rights. Notwithstanding anything to the contrary contained in this Loan Agreement, if at any time the rights, powers and
privileges of the Required Lenders, or the Administrative Agent following the occurrence of an Event of Default conflict (or are
inconsistent) with the rights and obligations of the Servicer, the rights, powers and privileges of the Required Lenders, or the
Administrative Agent shall supersede the rights and obligations of the Servicer to the extent of such conflict (or inconsistency),
with the express intent of maximizing the rights, powers and privileges of the Required Lenders and the Administrative Agent following
the occurrence of an Event of Default.

 

(g)Contract
to Extend Financial Accommodations. The parties hereto acknowledge that this Loan Agreement is, and is intended to be, a contract
to extend financial accommodations to the Borrower within the meaning of Section 365(e)(2)(B) of the Federal Bankruptcy Code (11
U.S.C. § 365(e)(2)(B)) (or any amended or successor provision thereof or any amended or successor code).

 

(h)Cumulative
Rights. For the avoidance of doubt, the rights and remedies granted to the Lenders or the Administrative Agent under this
Loan Agreement, any other Transaction Document, the relevant UCC or any other Applicable Law are cumulative and not exclusive,
and the exercise of any such rights and remedies will not be waived or deemed waived by any such Person merely by the receipt
of or acceptance by such Person of amounts on deposit in the Collection Account that are distributed pursuant to Section 5.2(c)
of this Loan Agreement.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 54 of 64	 

     

    

 

ARTICLE
XI

INDEMNIFICATION

 

Section
11.1General Indemnity. Without limiting any other rights which any such Person may have hereunder or under Applicable
Law, the Borrower hereby agrees to indemnify each Lender and the Administrative Agent (on their own behalf and on behalf of each
of the Lenders’ and the Administrative Agent’s Affiliates and each of such entities’ respective successors,
transferees, participants and assigns and all officers, directors, shareholders, controlling persons, employees and agents of
any of the foregoing) (each of the foregoing Persons being individually called an “Indemnified Party”), forthwith
on demand, from and against any and all damages, losses, claims, liabilities and related and reasonable costs and expenses actually
incurred, including reasonable attorneys’ fees and disbursements actually incurred (all of the foregoing being collectively
called “Indemnified Amounts”) awarded against or incurred by any of them arising out of or relating to any
Transaction Document or the transactions contemplated thereby, the acceptance and administration of this Loan Agreement by such
Person, any commingling of funds related to the transactions contemplated hereby (whether or not permitted hereunder), or the
use of proceeds therefrom by the Borrower, including (without limitation) in respect of the funding of any Advance or in respect
of any Policy; excluding, however, (i) Indemnified Amounts to the extent determined by a court of competent jurisdiction to have
resulted from gross negligence, fraud or willful misconduct on the part of any Indemnified Party (BUT EXPRESSLY EXCLUDING FROM
THIS CLAUSE (i), AND EXPRESSLY INCLUDING IN THE INDEMNITY SET FORTH IN THIS SECTION 11.1, INDEMNIFIED AMOUNTS ATTRIBUTABLE
TO THE ORDINARY, SOLE OR CONTRIBUTORY NEGLIGENCE OF SUCH INDEMNIFIED PARTY, IT BEING THE INTENT OF THE PARTIES THAT, TO THE EXTENT
PROVIDED IN THIS SECTION 11.1, INDEMNIFIED PARTIES SHALL BE INDEMNIFIED FOR THEIR OWN ORDINARY, SOLE OR CONTRIBUTORY NEGLIGENCE
NOT CONSTITUTING GROSS NEGLIGENCE, FRAUD OR WILLFUL MISCONDUCT), and (ii) any Tax upon or measured by net income (except those
described in Section 6.1(a)) on any Indemnified Party; including (without limitation), however, Indemnified Amounts resulting
from or relating to:

 

(i)any
representation or warranty made by or on behalf of the Borrower or the Parent in any Transaction Document to which it is a party,
which was incorrect in any respect when made;

 

(ii)failure
by the Borrower or the Parent to comply with any covenant made by it, or perform any obligation to be performed by it, in any
Transaction Document to which it is a party;

 

(iii)except
as expressly set forth in this Loan Agreement, the failure by the Borrower or the Parent to create and maintain in favor of the
Administrative Agent, for the benefit of the Secured Parties a valid perfected first priority security interest in the Collateral,
free and clear of any Adverse Claim;

 

(iv)the
Borrower’s use of the proceeds of the Advances;

 

(v)the
failure by the Borrower to pay when due any Taxes (including sales, excise or personal property taxes) payable in connection with
the purchase and sale of the Collateral;

 

(vi)the
commingling of the Collections with other funds of the Borrower;

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 55 of 64	 

     

    

 

(vii)any
legal action, judgment or garnishment affecting, or with respect to, distributions on any Pledged Policy or the Transaction Documents;
and

 

(viii)any
failure to comply with any Applicable Law with respect to any Pledged Policy or any other part of the Collateral.

 

If
and to the extent that the foregoing undertaking may be unenforceable for any reason, the Borrower hereby agrees to make the maximum
contribution to the payment of the amounts indemnified against in this Section 11.1 that is permissible under Applicable
Law.

 

ARTICLE
XII

ADMINISTRATIVE AGENT

 

Section
12.1Appointment. Each Lender hereby irrevocably designates and appoints the Administrative Agent as the agent of such
Lender under this Loan Agreement and the other Transaction Documents, and each such Lender irrevocably authorizes the Administrative
Agent, in such capacity, to take such action on its behalf under the provisions of this Loan Agreement and the other Transaction
Documents and to exercise such powers and perform such duties as are expressly delegated to the Administrative Agent by the terms
of this Loan Agreement and the other Transaction Documents, together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Loan Agreement, the Administrative Agent shall not have any duties
or responsibilities, except those expressly set forth herein, or any fiduciary relationship with any Lender, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities shall be read into this Loan Agreement or any other Transaction
Document or otherwise exist against the Administrative Agent.

 

Section
12.2Delegation of Duties. The Administrative Agent may execute any of its duties under this Loan Agreement and the
other Transaction Documents by or through agents or attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Administrative Agent shall not be responsible for the negligence or misconduct of any agents
or attorneys-in-fact selected by it with reasonable care.

 

Section
12.3Exculpatory Provisions. Neither the Administrative Agent nor any of its officers, directors, employees, agents,
attorneys-in-fact or Affiliates shall be (a) liable for any action lawfully taken or omitted to be taken by it or such Person
under or in connection with this Loan Agreement or any other Transaction Document (except for its or such Person’s own gross
negligence, fraud or willful misconduct) or (b) responsible in any manner to any of the Lenders for any recitals, statements,
representations or warranties made by the Borrower, the Parent, the Custodian, the Securities Intermediary or the Servicer or
any officer thereof contained in this Loan Agreement or any other Transaction Document or in any certificate, report, statement
or other document referred to or provided for in, or received by the Administrative Agent under or in connection with, this Loan
Agreement or any other Transaction Document or for the value, validity, effectiveness, genuineness, enforceability or sufficiency
of this Loan Agreement or any other Transaction Document or for any failure of the Borrower, the Parent, the Custodian, the Securities
Intermediary or the Servicer to perform its obligations hereunder or thereunder. The Administrative Agent shall not be under any
obligation to any Lender to ascertain or to inquire as to the observance or performance of any of the agreements contained in,
or conditions of, this Loan Agreement or any other Transaction Document, or to inspect the properties, books or records of the
Borrower, the Parent, the Custodian, the Securities Intermediary or the Servicer. The Administrative Agent shall not be required
to take any action that, in its opinion or the opinion of its counsel, may expose the Administrative Agent to liability or that
is contrary to this Loan Agreement, any other Transaction Document or Applicable Law, including for the avoidance of doubt any
action that may be in violation of the automatic stay under any Debtor Relief Law or that may affect a forfeiture, modification
or termination of property of any Lender.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 56 of 64	 

     

    

 

Section
12.4Reliance by the Administrative Agent. The Administrative Agent shall be entitled to rely, and shall be fully protected
in relying, upon any note, writing, resolution, notice, consent, certificate, affidavit, letter, telecopy, telex, e-mail or teletype
message, statement, order or other document or conversation believed by it to be genuine and correct and to have been signed,
sent or made by the proper Person or Persons and upon advice and statements of legal counsel (including, without limitation, counsel
to the Borrower or the Servicer), independent accountants and other experts selected by the Administrative Agent. The Administrative
Agent may deem and treat each Lender as the owner of its pro rata share of the Advances for all purposes unless a written notice
of assignment, negotiation or transfer thereof shall have been filed with the Administrative Agent. The Administrative Agent shall
be fully justified in failing or refusing to take any action under this Loan Agreement or any other Transaction Document unless
it shall first receive such advice or concurrence of the Required Lenders as it deems appropriate or it shall first be indemnified
to its satisfaction by the Lenders against any and all liability and expense which may be incurred by it by reason of taking or
continuing to take any such action. Subject to the Transaction Documents, the Administrative Agent shall in all cases be fully
protected in acting, or in refraining from acting, under this Loan Agreement and the other Transaction Documents in accordance
with a request of the Required Lenders, and such request and any action taken or failure to act pursuant thereto shall be binding
upon all the Lenders and all future holders of an interest in any of the Lender Notes.

 

Section
12.5Notice of Default. The Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of
any Unmatured Event of Default or Event of Default hereunder unless the Administrative Agent has received written notice from
a Lender referring to this Loan Agreement, describing such Unmatured Event of Default or Event of Default and stating that such
notice is a “notice of default”. In the event that the Administrative Agent receives such a notice, the Administrative
Agent shall give notice thereof to the Lenders. The Administrative Agent shall take such action, subject to the Transaction Documents
with respect to such Unmatured Event of Default or Event of Default as shall be directed by the Required Lenders.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 57 of 64	 

     

    

 

Section
12.6Non-Reliance on the Administrative Agent and Other Lenders. Each Lender expressly acknowledges that neither the
Administrative Agent nor any of its officers, directors, employees, agents, attorneys-in-fact or Affiliates has made any representations
or warranties to it and that no act by the Administrative Agent hereinafter taken, including any review of the affairs of the
Borrower or the Servicer, shall be deemed to constitute any representation or warranty by the Administrative Agent to any Lender.
Each Lender represents to the Administrative Agent that it has, independently and without reliance upon the Administrative Agent
or any other Lender, and based on such documents and information as it has deemed appropriate, made its own appraisal of, and
investigation into, the business, operations, property, financial and other condition and creditworthiness of the Borrower and
the Servicer and made its own decision to make its Advances hereunder and enter into this Loan Agreement. Each Lender also represents
that it will, independently and without reliance upon the Administrative Agent or any other Lender, and based on such documents
and information as it shall deem appropriate at the time, continue to make its own credit analysis, appraisals and decisions in
taking or not taking action under this Loan Agreement and the other Transaction Documents, and to make such investigation as it
deems necessary to inform itself as to the business, operations, property, financial and other condition and creditworthiness
of the Borrower and the Servicer. Except for notices, reports and other documents expressly required to be furnished to the Lenders
by the Administrative Agent hereunder, the Administrative Agent shall not have any duty or responsibility to provide any Lender
with any credit or other information concerning the business, operations, property, condition (financial or otherwise), prospects
or creditworthiness of the Borrower or the Servicer which may come into the possession of the Administrative Agent or any of its
officers, directors, employees, agents, attorneys-in-fact or Affiliates.

 

Section
12.7Indemnification. The Lenders agree to indemnify the Administrative Agent in its capacity as such (to the extent
not reimbursed by the Borrower and without limiting the obligation of the Borrower to do so), ratably according to their outstanding
Advances, from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind whatsoever which may at any time (including, without limitation, at any time following the
payment of all of the Lender Notes) be imposed on, incurred by or asserted against the Administrative Agent in any way relating
to or arising out of, the Commitments, this Loan Agreement, any of the other Transaction Documents or any documents contemplated
by or referred to herein or therein or the transactions contemplated hereby or thereby or any action taken or omitted by the Administrative
Agent under or in connection with any of the foregoing; provided that no Lender shall be liable for the payment of any portion
of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements resulting
solely from the Administrative Agent’s gross negligence, fraud or willful misconduct. The agreements in this Section
12.7 shall survive the payment of all of the Lender Notes and all other amounts payable hereunder and the termination of this
Loan Agreement.

 

Section
12.8The Administrative Agent in Its Individual Capacity. The Administrative Agent and its Affiliates may make loans
to, accept deposits from and generally engage in any kind of business with the Borrower or the Servicer or any of their Affiliates
as though the Administrative Agent were not the Administrative Agent hereunder and under the other Transaction Documents. With
respect to Advances made or renewed by it, the Administrative Agent shall have the same rights and powers under this Loan Agreement
and the other Transaction Documents as any Lender and may exercise the same as though it were not the Administrative Agent, and
the terms “Lender” and “Lenders” shall include the Administrative Agent in its individual capacity.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 58 of 64	 

     

    

 

Section
12.9Successor Administrative Agent. The Administrative Agent may resign as the Administrative Agent upon twenty (20)
days’ notice to the Lenders effective upon the appointment of a successor agent. If the Administrative Agent shall resign
as the Administrative Agent under this Loan Agreement and the other Transaction Documents, then the Required Lenders shall appoint
a successor agent for the Lenders, which successor agent shall be the initial Administrative Agent, an Affiliate of either the
outgoing Administrative Agent or the initial Administrative Agent or a commercial bank organized under the laws of the United
States of America or any State thereof or under the laws of another country which is doing business in the United States of America
and, if such successor agent is not the initial Administrative Agent, an Affiliate of either the outgoing Administrative Agent
or the initial Administrative Agent, together with its Affiliates, having a combined capital, surplus and undivided profits of
at least $100,000,000, whereupon such successor agent shall succeed to the rights, powers and duties of the Administrative Agent,
and the term “Administrative Agent” shall mean such successor agent effective upon such appointment and approval,
and the former Administrative Agent’s rights, powers and duties as the Administrative Agent shall be terminated, without
any other or further act or deed on the part of such former Administrative Agent or any of the parties to this Loan Agreement
or any holders of an interest in any of the Lender Notes. After any retiring Administrative Agent’s resignation as the Administrative
Agent, all of the provisions of this Article XII shall inure to its benefit as to any actions taken or omitted to be taken by
it while it was the Administrative Agent under this Loan Agreement and the other Transaction Documents.

 

ARTICLE
XIII

MISCELLANEOUS

 

Section
13.1Amendments, Etc. No amendment or waiver of, or consent to the Borrower’s departure from, any provision of
this Loan Agreement shall be effective unless it is in writing and signed by the Borrower and the Administrative Agent, with the
written consent of the Required Lenders (or, in the case of any amendment, waiver or consent that would result in a decrease in
the interest rate on any Advance, a reduction in the principal amount of any Advance, an extension of time to make any payment
of principal or interest on any Advance, or a release of all or any of the Collateral (other than as expressly contemplated hereunder),
by each Affected Party), and then such amendment, waiver or consent shall be effective only in the specific instance and for the
specific purpose for which it was given.

 

Section
13.2Notices, Etc. All notices, directions, instructions, demands and other communications provided for hereunder shall,
unless otherwise stated herein, be in writing (including electronic mail communication) and sent to each party entitled thereto,
at its address set forth on Schedule 13.2, or at such other address as shall be designated by such party in a written notice to
the other parties hereto. All such notices, directions, instructions, demands and communications shall be effective: (a) if sent
by overnight courier, on the Business Day after the day sent, (b) if by U.S. mail, three (3) Business Days after being deposited
in the mail, (c) if delivered personally, when delivered, and (d) if sent by electronic mail, when the sender thereof shall have
received electronic confirmation of the transmission thereof (provided that should such day not be a Business Day, on the next
Business Day), except any such notice, direction, demands or other communications to the Administrative Agent shall only be effective
upon actual receipt.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 59 of 64	 

     

    

 

Section
13.3No Waiver; Remedies. No failure on the part of any Lender or the Administrative Agent to exercise, and no delay
in exercising, any right hereunder or under any Transaction Document shall operate as a waiver thereof; nor shall any single or
partial exercise of any right hereunder preclude any other or further exercise thereof or the exercise of any other right. The
remedies herein provided are cumulative and not exclusive of any remedies provided by law.

 

Section
13.4Binding Effect; Assignability; Term. This Loan Agreement shall be binding upon and inure to the benefit of the
Borrower, each Lender and the Administrative Agent, and their respective successors and assigns, except that no party shall have
the right to assign any of their respective rights, or to delegate any of their respective duties and obligations, hereunder without
the prior written consent of the other parties except as set forth below. Any Lender may assign all or any portion of its Lender
Note, Commitment and Advances hereunder pursuant to an assignment and assumption agreement in substantially the form attached
hereto as Exhibit C (each, an “Assignment and Assumption Agreement”) or sell participation interests in its
Advances and Obligations hereunder. This Loan Agreement shall create and constitute the continuing obligation of the parties hereto
in accordance with its terms, and shall remain in full force and effect until such time as the Commitments have terminated and
all the principal of and interest on the Advances and all other Obligations are paid in full; provided that rights and
remedies of the Lenders and the Administrative Agent, as applicable, under Article XI and Section 3.1, Section 3.3
and Section 13.8 shall survive any termination of this Loan Agreement. Each Indemnified Bank Person shall be an express
third-party beneficiary of Section 5.2 of this Loan Agreement and shall be entitled to bring any action necessary to enforce
its rights thereunder.

 

Section
13.5GOVERNING LAW; JURY TRIAL. (a) THIS LOAN AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED IN SUCH STATE, EXCLUDING CHOICE OF LAW PRINCIPLES
OF THE LAW OF SUCH STATE THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF A JURISDICTION OTHER THAN SUCH STATE.

 

(b)EACH
OF THE PARTIES HERETO HEREBY WAIVES ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT,
TORT OR OTHERWISE ARISING OUT OF, CONNECTED WITH, RELATING TO OR INCIDENTAL TO THE TRANSACTIONS CONTEMPLATED BY THIS LOAN AGREEMENT
OR THE OTHER TRANSACTION DOCUMENTS.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 60 of 64	 

     

    

 

Section
13.6Execution in Counterparts. This Loan Agreement may be executed in any number of counterparts and by different parties
hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which when taken
together shall constitute one and the same agreement. Delivery of an executed counterpart of this Loan Agreement by facsimile
or transmitted electronically in either Tagged Image File Format (“TIFF”) or Portable Document Format (“PDF”)
shall be equally effective as delivery of a manually executed counterpart hereof. Any party delivering an executed counterpart
of this Loan Agreement by facsimile, TIFF or PDF shall also deliver a manually executed counterpart hereof, but failure to do
so shall not affect the validity, enforceability, or binding effect of this Loan Agreement.

 

Section
13.7Submission to Jurisdiction. Each party hereto hereby submits to the exclusive jurisdiction of the courts of the
State of New York and of any Federal court located in the State of New York (or any appellate court from any thereof) in any action
or proceeding arising out of or relating to this Loan Agreement or the transactions contemplated hereby. Each party hereto hereby
irrevocably waives any objection that it may have to the laying of venue of any such proceeding and any claim that any such proceeding
has been brought in an inconvenient forum.

 

Section
13.8Costs and Expenses. In addition to its obligations under Section 3.3 and Article XI, the Borrower agrees
to pay on demand:

 

(a)all
reasonable and actual costs and expenses incurred by the Administrative Agent and each Lender in connection with (i) the preparation,
execution, delivery, administration and enforcement of, or any actual or claimed breach of or any amendments, waivers or consents
under or with respect to, this Loan Agreement, the Lender Notes and the other Transaction Documents (whether or not such amendment,
waiver or consent becomes effective), including, without limitation, the reasonable fees and expenses of counsel to any of such
Persons actually incurred in connection therewith, (ii) the perfection of Administrative Agent’s security interest in the
Collateral, (iii) the maintenance of the Accounts, the Policy Account and the Borrower Account, and (iv) subject to Section
9.1(i), the audit of the books, records and procedures of the Servicer or the Borrower by the Administrative Agent’s
auditors (which may be employees of the Administrative Agent), and

 

(b)all
stamp and other Taxes and fees payable or determined to be payable in connection with the execution, delivery, filing and recording
of this Loan Agreement, the Lender Notes or the other Transaction Documents, and agrees to indemnify each Indemnified Party against
any liabilities with respect to or resulting from any delay in paying or omission to pay such Taxes and fees.

 

Section
13.9Severability of Provisions. If any one or more provisions of this Loan Agreement shall for any reason be held invalid,
then such provisions shall be deemed severable from the remaining provisions of this Loan Agreement and shall in no way affect
the validity or enforceability of other provisions of this Loan Agreement.

 

Section
13.10ENTIRE AGREEMENT. THIS LOAN AGREEMENT AND THE OTHER TRANSACTION DOCUMENTS EXECUTED AND DELIVERED HEREWITH REPRESENT
THE FINAL AGREEMENT BETWEEN THE PARTIES HERETO AND THERETO AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 61 of 64	 

     

    

 

Section
13.11 Conflicts. With respect to the matters set forth herein, in the event of any conflict between the provisions of
this Loan Agreement and the provisions of any collateral assignment related to a Pledged Policy, the provisions of this Loan
Agreement shall govern and control.

 

Section
13.12Confidentiality. No party to this Loan Agreement that receives any Confidential Information (the “Receiving
Party”) from any other party (the “Disclosing Party”) under this Loan Agreement or any other Transaction
Document shall disclose any Confidential Information of the Disclosing Party to any Person without the consent of the Disclosing
Party, other than (a) to the Servicer, the Securities Intermediary, the Custodian and the Receiving Party’s Affiliates and
its and their respective officers, directors, employees, trustees, agents and advisors (collectively, its “Representatives”)
and to actual or prospective assignees under Section 13.4, and then only on a confidential basis, (b) as required by any
law, rule or regulation or judicial process, including any requirements to make disclosures thereof pursuant to applicable securities
laws, (c) as requested or required by any state, Federal or foreign authority or examiner (including the National Association
of Insurance Commissioners or any similar organization or quasi-regulatory authority) regulating the Receiving Party, the Servicer,
the Securities Intermediary, the Custodian and/or their respective Affiliates, (d) to any rating agency when required by it, provided
that, prior to any such disclosure, such rating agency shall undertake to preserve the confidentiality of any Confidential Information
relating to the Disclosing Party received by it from the Receiving Party, (e) in connection with any litigation or proceeding
to which the Receiving Party, the Servicer, the Securities Intermediary, the Custodian and/or their respective Affiliates may
be a party, (f) in connection with the exercise of any right or remedy under this Loan Agreement or any other Transaction Document,
and any related or subsequent sale or other transaction involving any of the Collateral or other collateral or assets pledged
pursuant to any Transaction Document to secure the repayment of the Advances or (g) if any such Confidential Information becomes
publicly available so long as such availability is not caused by the Receiving Party or any of its Affiliates or any of their
respective officers, directors, employees, trustee, agents and advisors. Notwithstanding the foregoing, it is expressly agreed
that following the Closing Date, the Lenders may make or cause to be made a press release, public announcement or publicity statement
(including placing a “tombstone” advertisement) relating to this Loan Agreement; provided that the parties hereto
will consult with each other regarding the content and timing of any such press release, public announcement or publicity statement.

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 62 of 64	 

     

    

 

Section
13.13Limitation on Liability. TO THE EXTENT PERMITTED BY APPLICABLE LAW, AND NOTWITHSTANDING ANY OTHER PROVISION OF
THIS LOAN AGREEMENT OR THE OTHER TRANSACTION DOCUMENTS, THE ADMINISTRATIVE AGENT, THE LENDERS OR ANY INDEMNIFIED PARTY SHALL NOT
BE LIABLE TO ANY PARTY FOR ANY INDIRECT, SPECIAL, PUNITIVE OR CONSEQUENTIAL DAMAGES IN CONNECTION WITH THEIR RESPECTIVE ACTIVITIES
RELATED TO THIS LOAN AGREEMENT, THE OTHER TRANSACTION DOCUMENTS, THE TRANSACTIONS CONTEMPLATED THEREBY, THE LENDER NOTES, THE
ADVANCES OR OTHERWISE IN CONNECTION WITH THE FOREGOING. WITHOUT LIMITING THE FOREGOING, THE PARTIES AGREE THAT THE ADMINISTRATIVE
AGENT, THE LENDERS OR ANY INDEMNIFIED PARTY SHALL NOT BE SUBJECT TO ANY EQUITABLE REMEDY OR RELIEF, INCLUDING SPECIFIC PERFORMANCE
OR INJUNCTION ARISING OUT OF OR RELATING TO THIS LOAN AGREEMENT, THE OTHER TRANSACTION DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED
THEREBY. NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, IN NO EVENT SHALL LENDERS’ LIABILITY FOR FAILURE TO FUND ANY ADVANCE
EXCEED THE AMOUNT OF SUCH ADVANCE AND ONE MILLION DOLLARS ($1,000,000) IN AGGREGATE FOR ALL ADVANCES, AND IN FURTHER LIMITATION
OF THE LENDERS’ LIABILITY ARISING OUT OF THIS LOAN AGREEMENT, IN NO EVENT SHALL LENDERS’ LIABILITY ARISING OUT OF
THIS LOAN AGREEMENT FOR ANY REASON WHATSOEVER EXCEED ONE MILLION DOLLARS ($1,000,000) IN AGGREGATE FOR ALL SUCH LIABILITIES.

 

[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK]

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 63 of 64	 

     

    

 

Section
13.14Relationship of Parties. Notwithstanding that Advances made from time to time hereunder may be used to pay Ongoing
Maintenance Costs, the relationship of each Secured Party and the Borrower is solely one of lender and borrower and this Loan
Agreement does not constitute a partnership, tenancy-in-common, joint tenancy or joint venture between any of the Secured Parties
and the Borrower, nor does this Loan Agreement create an agency or fiduciary relationship between any of the Secured Parties and
the Borrower. The Borrower is not the representative or agent of any of the Secured Parties and no Secured Party is a representative
or agent of the Borrower. The parties hereto intend that the relationship among them shall be solely that of creditor and debtor.
No Secured Party shall in any way be responsible or liable for the debts, losses, obligations or duties of the Borrower.

 

IN
WITNESS WHEREOF, the parties have caused this Loan and Security Agreement to be executed by their respective officers thereunto
duly authorized as of the day and year first above written.

 

	 	GWG
    DLP FUNDING IV, LLC,
	 	as
    Borrower
	 	 
	 	By:	/s/
    Jon R. Sabes
	 	Name:	Jon
    R. Sabes
	 	Title:	President

 

	 	CLMG CORP., as Administrative Agent
	 	 	 
	 	By:	/s/
    James Erwin
	 	Name:	James
    Erwin
	 	Title:	President

 

	 	LNV CORPORATION, as Lender
	 	 	 
	 	By:	/s/
    Jacob Cherner
	 	Name:	Jacob
    Cherner
	 	Title:	President

 

GWG DLP Funding IV,
LLC Loan and Security Agreement

    	 	Page 64 of 64	 

     

    

 

ANNEX
I

LIST OF DEFINED TERMS

“21st
Services” means 21st Holdings, LLC and its Affiliates and their respective successors.

“Account
Control Agreement” means the Securities Intermediary Agreement, dated as of September 14, 2016, among the Borrower,
the Administrative Agent, the Securities Intermediary, the Custodian and the Servicer, specifying the rights of the parties in
the Accounts, the Policy Account and the Borrower Account, as the same may be amended, supplemented or otherwise modified from
time to time in accordance with the Transaction Documents.

“Accounts”
means the Collection Account, the Reserve Account and the Payment Account, collectively.

“Acknowledgement”
means, with respect to any Policy, a written acknowledgement from the related Issuing Insurance Company confirming that the records
of the Issuing Insurance Company name the Securities Intermediary as the owner and beneficiary of the applicable Policy.

“Additional
Policies” means Policies to be acquired by the Borrower with the proceeds of an Additional Policy Advance and/or to
be pledged to the Administrative Agent for the benefit of the Lenders in connection with an Additional Policy Advance.

“Additional
Policy Advance” shall mean an Advance other than the Initial Advance pursuant to which Additional Policies are pledged
to the Administrative Agent under the Loan Agreement.

“Additional
Policy Advance Amount” with respect to any Additional Policy Advance, shall mean the amount specified in the related
Additional Policy Advance Acceptance.

“Additional
Policy Advance Acceptance” has the meaning set forth in Section 2.3(d) of the Loan Agreement.

“Administrative
Agent” means CLMG Corp., as Administrative Agent under the Loan Agreement.

“Administrative
Agent’s Account” has the meaning set forth in Section 4.3 of the Loan Agreement.

“Advance”
means the Initial Advance, an Additional Policy Advance, a Protective Advance or an Ongoing Maintenance Advance, as applicable,
and collectively, the “Advances”.

“Advance
Date” shall mean any date on which an Advance is funded by the Lenders pursuant to the terms of the Loan Agreement,
which may be the Closing Date, the date of the funding of the Second Initial Advance, any Subsequent Advance Date or the date
the Lenders fund any Protective Advance in their sole discretion.

 

     

     

    

 

“Adverse
Claim” means a Lien, security interest, pledge, charge or encumbrance, or similar right or claim of any Person, other
than Liens in favor of (i) the Administrative Agent pursuant to the Transaction Documents or (ii) in the case of a Retained Death
Benefit Policy, an original owner, insured or seller or any family member of any of the foregoing of a Pledged Policy or Subject
Policy, but only to the extent of the portion of the death benefit retained by or in favor of such Person.

“Affected
Party” means each Lender, any permitted assignee of any Lender, and any holder of a participation interest in the rights
and obligations of any Lender, the Administrative Agent and any Affiliate of any of the foregoing.

“Affiliate”
means, with respect to any Person, 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”
another Person if such other Person possesses, directly or indirectly, power (a) to vote five percent (5%) or more of the securities
(on a fully diluted basis) having ordinary voting power for the election of directors or managing partners of such Person, or
(b) to direct or cause the direction of the management and policies of such Person whether by contract or otherwise. The word
“Affiliated” has a correlative meaning.

“Affiliated
Entity” means any Subsidiary of the Borrower and any of its or the Borrower’s Affiliates.

“Alternative
Information Notice” has the meaning set forth in Section 5.2(a) of the Loan Agreement.

“A.M.
Best” means A.M. Best Company, Inc. and any successor or successors thereto.

“Annual
Budget” has the meaning specified in Section 9.1(d)(vi) of the Loan Agreement.

“Anti-Money
Laundering Laws” has the meaning set forth in Section 8.1(v)(iii) of the Loan Agreement.

“Applicable
Law” means, as to any Person or any matter, any law (statutory or common), treaty, rule or regulation or determination
of an arbitrator or of any nation or government, any state or other political subdivision thereof, any central bank (or similar
monetary or regulatory authority) thereof, any entity exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government, and any corporation or other entity owned or controlled, through stock or capital ownership
or otherwise, by any of the foregoing, in each case applicable to or binding upon such Person (or any of its property) or such
matter, or to which such Person (or any of its property) or such matter is subject, including, without limitation, any laws relating
to assignments of contracts, life settlements, viatical settlements, insurance, consumers and consumer protection, usury, truth-in-lending,
fair credit reporting, equal credit opportunity, federal and state securities or “blue sky” laws, the Federal Trade
Commission Act and ERISA and in the case of Section 6.3 of the Loan Agreement, FATCA.

“Applicable
Margin” means five and three quarters percent (5.75%).

 

    	 	I-2	 

     

    

 

“Assignment
and Assumption Agreement” has the meaning set forth in Section 13.4 of the Loan Agreement.

“Available
Amount” means, with respect to any Distribution Date, the amount on deposit in the Collection Account.

“AVS”
means AVS Underwriting, LLC and its successors.

“Base
Rate” means, for any date of determination, the greater of (a) the sum of (i) the Federal Funds Rate on such date plus
(ii) one half of one percent (0.5%) and (b) one percent (1.0%).

“Blocked
Person” has the meaning set forth in Section 8.1(v)(i) of the Loan Agreement.

“Borrower”
has the meaning set forth in the recitals to the Loan Agreement.

“Borrower
Account” has the meaning set forth in Section 5.1(d) of the Loan Agreement.

“Borrower
Failure Procedures” has the meaning set forth in Section 5.2(a) of the Loan Agreement.

“Borrower
Organizational Documents” means the certificate of formation filed on May 18, 2016 with the office of the Delaware Secretary
of State, and the LLC Agreement, each as the same may be amended, supplemented or otherwise modified from time to time in accordance
with the Transaction Documents.

“Borrower
Valuation” has the meaning set forth in Section 7.5(b) of the Loan Agreement.

“Borrowing
Base” means, on any date of determination, the lesser of: (A) (i) prior to the making of any Ongoing Maintenance Advance
or Additional Policy Advance, sixty percent (60%) of the Lender Valuation of the Pledged Policies and (ii) thereafter, fifty percent
(50%) of the Lender Valuation of the Pledged Policies and (B) the Facility Limit.

“Borrowing
Base Certificate” means a certificate in the form of Exhibit F to the Loan Agreement.

“Borrowing
Base Period” means, with respect to any Distribution Date, the period of time commencing three (3) Business Days prior
to the Calculation Date related to the immediately preceding Distribution Date and ending three (3) Business Days prior to the
Calculation Date related to such Distribution Date (or if such Distribution Date is the first Distribution Date, the Closing Date).

“Borrowing
Request” has the meaning set forth in Section 2.2(a) of the Loan Agreement.

“Business
Day” means any day on which commercial banks in any of New York, New York, Wilmington, Delaware, Salt Lake City, Utah
or Minneapolis, Minnesota, are not authorized or are not required to be closed. Notwithstanding the immediately preceding sentence,
with respect to any funding obligations of the Lenders under the Loan Agreement, Business Day shall mean any day on which the
Federal Reserve Bank of New York is open for business.

 

    	 	I-3	 

     

    

 

“Calculation
Date” means the tenth (10th) day following March 31, June 30, September 30 or December 31 of each year, as applicable,
beginning on September 30, 2016, or if such day is not a Business Day, the next succeeding Business Day.

“Calculation
Date Report” has the meaning set forth in Section 5.2(a) of the Loan Agreement.

“Cash
Sweep” has the meaning set forth in Section 5.2(b) of the Loan Agreement.

“Change
in Control” means a change or series of changes resulting when (i) the Borrower or the Parent, as applicable, merges
or consolidates with any other Person or permits any other Person to become the successor to its business, and the Borrower or
the Parent, as applicable, is not the surviving entity after such merger, consolidation or succession, other than as expressly
permitted by the Transaction Documents, (ii) the Borrower or the Parent, as applicable, conveys, transfers or leases substantially
all of its assets as an entirety to another Person, other than as expressly permitted by the Transaction Documents or (iii) any
Person shall become the owner, directly or indirectly, beneficially or of record, of equity representing more than fifty percent
(50%) of the aggregate ordinary voting power represented by the issued and outstanding equity of the Borrower or the Parent.

“Change
Forms” means, with respect to any Policy, all documents required by the applicable Issuing Insurance Company to be executed
by the Borrower (or the Securities Intermediary, as owner thereof for the benefit of the Borrower or the Administrative Agent
as secured party pursuant to the Account Control Agreement) to effect change of ownership of and designation of a new owner and
beneficiary under such Policy.

“Claims”
has the meaning set forth in the Account Control Agreement.

“Closing
Date” means September 14, 2016.

“Closing
Fee” means, with respect to the First Initial Advance, a fee in an amount equal to the product of (i) the amount of
the Facility Limit and (ii) two percent (2.00%).

“Code”
means the Internal Revenue Code of 1986, as amended, or any successor statute.

“Collateral”
has the meaning set forth in Section 2.6(a) of the Loan Agreement.

“Collateral
Audit” has the meaning set forth in Section 9.1(i) in the Loan Agreement.

“Collateral
Package” means all files related to the Policies, including but not limited to, the Sale Documents and all Policy files
related to the purchase or acquisition of each Policy (which shall include the most recent Policy Illustrations, Life Expectancy
estimates, the Physicians Competency Statement and medical records available to the Borrower), all documents set forth on Exhibit
M to the Account Control Agreement and any other documents or data as requested by the Administrative Agent.

 

    	 	I-4	 

     

    

 

“Collection
Account” has the meaning set forth in Section 5.1(a) of the Loan Agreement.

“Collections”
means, collectively, all payments made by or on behalf of the Issuing Insurance Companies or any other Person in respect of the
Policies, including without limitation, all Liquidation Proceeds, all proceeds of Policy Loans or withdrawals of cash surrender
value and any proceeds of any other Collateral (including any proceeds of a sale pursuant to Section 2.7 of the Loan Agreement,
which proceeds shall be deposited in the Administrative Agent’s Account pursuant to Section 4.1(b) of the Loan Agreement),
whether in the form of cash, checks, wire transfers, electronic transfers or any other form of cash payment.

“Commitment”
means, with respect to any Lender, the maximum amount that may be advanced by such Lender under the Loan Agreement as specified
in Schedule 2.1(a) to the Loan Agreement as the same is amended pursuant to any Assignment and Assumption Agreement.

“Confidential
Information” means the terms and conditions of the Loan Agreement and the other Transaction Documents and the transactions
contemplated hereby and thereby, including (i) any term sheets, loan applications or other documents related to the Loan Agreement
or the Transaction Documents and (ii) any copies of such documents or any portions thereof.

“Corporate
Services Provider” means Lord Securities Corporation.

“Covered
Taxes” means Taxes, now or hereafter imposed, levied, collected, withheld or assessed by any Governmental Authority
or other taxing authority excluding, in the case of the Administrative Agent and each Lender, net income taxes imposed on the
Administrative Agent or such Lender by the jurisdiction under the laws of which the Administrative Agent or such Lender is organized
or any political subdivision or taxing authority thereof or therein.

“Cure
Notice” means a written notice from the Required Lenders to the Borrower indicating that the Required Lenders are granting
the Borrower a cure period not exceeding ninety (90) days in order to cure an occurrence that would otherwise constitute an Event
of Default.

“Custodial
Package” shall mean with respect to a Policy, collectively, the documents set forth on Exhibit M to the Account Control
Agreement.

“Custodian”
means Wells Fargo, together with its successors and assigns, solely in its capacity as Custodian under the Account Control Agreement.

“Debt
Service” means, for any period, the sum of (i) the Required Amortization and (ii) the interest accrued and that will
accrue on the Advances during such period.

“Default
Rate” means, in the event that an Event of Default has occurred and is continuing, the interest rate per annum at which
each Loan shall bear interest, equal to the sum of (i) the greater of (A) LIBOR or, if LIBOR is unavailable, (B) the Base Rate,
plus (ii) seven and three quarters percent (7.75%).

 

    	 	I-5	 

     

    

 

“Deficiency
Claim Amount” has the meaning set forth in Section 5.1(b) of the Loan Agreement.

“Disclosing
Party” has the meaning set forth in Section 13.12 of the Loan Agreement.

“Distribution
Date” means the fifth day after each Calculation Date, beginning in October 2016, or if such day is not a Business Day,
the next succeeding Business Day.

“Dollar”
and the sign “$” shall mean lawful money of the United States of America.

“Eligibility
Criteria” with respect to any Policy, means the following criteria, which are to be satisfied as of the Advance Date
as of which such Policy becomes a Pledged Policy:

(a) The Securities Intermediary is designated as the “owner” and “beneficiary” under the Policy by the Issuing
Insurance Company.

(b) 
The Policy is (i) a single life or survivorship policy, (ii) a fixed or variable universal life, whole life, or convertible term
(provided such Policy is converted to a “permanent” life insurance policy prior to becoming a Pledged Policy), (iii)
denominated and payable in U.S. Dollars and (iv) issued by a U.S. domiciled insurance company.

(c) 
Each Insured is a United States citizen or permanent resident alien currently residing in the United States as of the date the
Policy was acquired by the Borrower, and has documented social security information and photographic identification.

(d) 
Each Insured shall be an individual seventy (70) years old or older.

(e) 
The Policy shall be in full force.

(f) 
The Issuing Insurance Company shall have (i) a financial strength rating of “A-” from A.M. Best or (ii) a financial
strength rating of less than “A-” from A.M. Best that is approved by the Required Lenders in their sole and absolute
discretion.

(g) 
Medical underwriting as to Life Expectancy shall be conducted with respect to each Insured under the Policy by at least two Pre-Approved
Medical Underwriters; in addition:

(i) an average Life Expectancy for each Insured under the Policy shall be calculated, which shall equal the average (arithmetic mean)
of the two (2) Life Expectancies provided by the Pre-Approved Medical Underwriters with respect to such Insured;

(ii) 
(x) LE Reports must not be dated more than six (6) months prior to the related Advance Date and (y) must be based on medical records
obtained from the Insured that are not older than twelve (12) months as of the related Advance Date; and

 

    	 	I-6	 

     

    

 

(iii) 
for each Insured, the results reported in the two LE Reports used to calculate the average Life Expectancy in (g)(i) above must
not differ by more than thirty percent (30%) of the longer Life Expectancy or twelve (12) months, whichever is greater.

(h) 
Each Insured under the Policy must have an average Life Expectancy (determined in accordance with clause (g)(i) above) of no more
than one-hundred eighty (180) months.

(i) 
The Policy covering the life of an individual Insured shall not have a face amount of less than $70,000 or greater than $10.0
million, except as otherwise approved in writing by the Required Lenders.

(j) 
The Policy is beyond all relevant policy or statutory contestability and suicide periods, including from the date of any conversion
of such Policy, if applicable.

(k) 
There must not be any outstanding Policy Loans or Liens outstanding in respect of the Policy, except for outstanding internal
Policy Loans for the payment of premiums on the Policy, if any, or, if such Policy is a Retained Death Benefit Policy, any Liens
identified in clause (ii) of the definition of “Adverse Claim,” and, in each case, that will be fully reflected in
the pricing analysis and calculation, nor any other pledge or assignment outstanding on the Policy.

(l) 
The life expectancy reflected in the LE Report used to determine the Lender Valuation with respect to the related Advance is not
less than twenty-four (24) months from the date of such Advance.

(m) The Policy and the legal and beneficial interests in the death benefit (taking into account the portion of the death benefit payable
to a Person other than the Securities Intermediary who is designated as the “beneficiary” under a Retained Death Benefit
Policy and previously disclosed in writing to, and approved in writing by, the Administrative Agent) shall be capable of being
sold, transferred and conveyed to the Borrower and its successors, assigns and designees, and the seller thereof to the Borrower
shall have the right to do so, and, all related settlement contract documents and any tracking/servicing/custodial rights shall
be fully assignable and transferable to the Borrower and its successors, assigns and designees or as otherwise directed by the
Borrower.

(n) 
Each Insured’s primary diagnosis leading to the Life Expectancy evaluation(s) must not be HIV or AIDS.

(o) 
The Policy shall not be purchased from a seller to which applicable state laws prohibiting the purchase or the transfer of ownership
from such seller apply at the time of such purchase or transfer of ownership.

(p) 
The original owner/beneficiary under the Policy shall have had an insurable interest at the time of the initial issuance of the
Policy.

 

    	 	I-7	 

     

    

 

(q) 
The Policy shall not have a death benefit that, by the terms of the Policy, will decrease over time or from time to time, unless
such decrease is scheduled and can be incorporated and fully reflected in the pricing of the Policy, and where the Policy shall
contain no provisions limiting the future realization of the net death benefit, other than non-payment of premiums or the Insured
reaching a certain age.

(r) 
The sale of the Policy from the Original Owner thereof and all subsequent transfers of the Policy complied with all Applicable
Law.

(s) 
The transfer of the Policy is not subject to the payment of United States state sales taxes or any other taxes payable by the
Borrower.

(t) 
The Lender Valuation in respect of such Policy does not exceed twelve and a half percent (12.5%) of the value of the Collateral
as determined by the Required Lenders in their sole and absolute discretion.

(u) 
The face amount of the Policy does not exceed five percent (5%) of the aggregate face amount of all Eligible Policies included
in the Collateral.

(v) 
The Policy was approved at the time of such Advance Date by the Required Lenders.

(w) 
The Rescission Period with respect to such Policy shall have expired.

(x) 
The Policy is not subject to any Applicable Law that makes unlawful the sale, transfer or assignment of such Policy.

(y) 
The documents and agreements contained in the related Collateral Package and listed on Exhibit M to the Account Control Agreement
do not contain language purporting to limit their assignability, and none of the Borrower, the Parent or any Affiliate of any
of them is a party to any agreement that limits their assignability, and all such documents are fully assignable and transferable
to the Borrower and its successors, assigns and designees or as otherwise directed by the Borrower.

(z) 
With respect to such Policy, the Borrower is not aware of any agreements, documents, assignments or instruments related to such
Policy except for those agreements, documents, assignments and instruments that constitute and were included in the related Collateral
Package that was delivered to the Administrative Agent.

(aa) 
The related Collateral Package delivered to the Administrative Agent by or on behalf of the Borrower contain, at the very least,
the documents set forth in Exhibit M to the Account Control Agreement.

(bb) 
Unless such Policy is a Retained Death Benefit Policy that has been previously disclosed in writing to and approved in writing
by the Administrative Agent, such Policy is not a retained death benefit policy or similar policy in which any Person other than
the Borrower has any direct or indirect interest of any kind in the death benefit payable under such Policy.

 

    	 	I-8	 

     

    

 

Notwithstanding
any of the foregoing, if such Policy is a Small Face Policy, the Life Expectancy with respect to each Insured under such Policy
may be based on estimates as determined by the Required Lenders in their sole and absolute discretion.

“Eligible
Account” means either (a) a segregated account with an Eligible Institution or (b) a segregated trust account with the
corporate trust department of a depository institution organized under the laws of the United States or any of the states thereof,
including the District of Columbia (or any domestic branch of a foreign bank), and acting as a trustee for funds deposited in
such account, so long as the senior securities of such depository institution shall have a credit rating from each of Moody’s
and S&P in one of its generic credit rating categories no lower than “A-” or “A3”, as the case may
be.

“Eligible
Institution” means a depositary institution organized under the laws of the United States of America or any one of the
states thereof or the District of Columbia (or any domestic branch of a foreign bank), (a) which has both (x) a long-term unsecured
senior debt rating of not less than “A” by S&P and “A2” by Moody’s, and (y) a short-term unsecured
senior debt rating rated in the highest rating category by S&P and Moody’s and (b) whose deposits are insured by
the Federal Deposit Insurance Corporation.

“Eligible
Policy” means a Policy that, as of the Advance Date as of which such Policy first becomes a Pledged Policy, satisfies
all of the Eligibility Criteria (unless with respect to any particular criteria set forth in the Eligibility Criteria, such Policy
is identified in the applicable section of the Eligibility Criteria Exception Schedule attached to the Agreement as not satisfying
such particular criteria).

“ERISA”
means the U.S. Employee Retirement Income Security Act of 1974, 29 U.S.C. §1001 et seq., as amended from time
to time and the regulations promulgated thereunder.

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

(a) 
a case 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, examinership or composition or readjustment of debts of such Person,
the appointment of a trustee, receiver, custodian, liquidator, examiner, 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, examinership or composition or adjustment of debts and such case or proceeding shall remain
undismissed or unstayed for a period of sixty (60) days; 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.

 

    	 	I-9	 

     

    

 

“Event
of Default” has the meaning set forth in Section 10.1 of the Loan Agreement.

“Excluded
Policy” means (i) any Policy pledged under the Loan Agreement for which no written acknowledgement of a collateral assignment
was received by the Administrative Agent or the Securities Intermediary from the related Issuing Insurance Company within ninety
(90) calendar days of the Advance Date as of which such Policy became a Pledged Policy and (ii) any Policy pledged under the Loan
Agreement in respect of which the Insurance Consultant is not authorized to, or is not accepted by the related Issuing Insurance
Company to, communicate and receive verifications of coverage and obtain other information from such Issuing Insurance Company.
With respect to any Policy described in clause (i) of the immediately preceding sentence, if such written acknowledgement of a
collateral assignment is received by the Administrative Agent or the Securities Intermediary after such date, such Policy shall
cease to be an Excluded Policy on the date of such receipt. With respect to any Policy described in clause (ii) of the first sentence
of this definition, if the Insurance Consultant becomes authorized to, or becomes accepted by the related Issuing Insurance Company
to, communicate and receive verifications of coverage and obtain other information from such Issuing Insurance Company, such Policy
shall cease to be an Excluded Policy on the date of such authorization or acceptance.

“Expense
Deposit” means, with respect to any Additional Policies proposed to be pledged under the Loan Agreement in connection
with the making of an Additional Policy Advance, an amount required to reimburse the Administrative Agent and the Lenders for
third-party out-of-pocket expenses incurred in connection with the review and evaluation of such Additional Policies, as determined
by the Administrative Agent in its reasonable discretion.

“Expenses”
means the sum of (i) the Servicing Fee, (ii) payments to the Custodian or Securities Intermediary, as applicable, related to the
Pledged Policies or accounts of the Borrower and (iii) reasonable administrative expenses and documented third-party expenses
payable pursuant to clause “Fourth” in Section 5.2(b) of the Loan Agreement. The schedules of such Expenses shall
be approved by the Required Lenders as of the Closing Date. The Expenses to be funded during any succeeding calendar year shall
be approved by the Required Lenders in their sole and absolute discretion upon review of the Annual Budget for such succeeding
calendar year as contemplated by Section 9.1(d)(vi) of the Loan Agreement.

“Facility
Limit” means $172,300,000.

“Fasano”
means Fasano Associates, Inc. and its successors.

“FATCA”
means Sections 1471 through 1474 of the Code, as of the date of the Loan Agreement (or any amended or successor version that is
substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations
thereof and any agreements entered into pursuant to Section 1471(b)(1) of the Code.

 

    	 	I-10	 

     

    

 

“Fee
Letter” means that certain schedule of fees setting forth the fees of the Securities Intermediary and the Custodian,
dated August 1, 2016 and executed by the Borrower in favor of Wells Fargo on August 3, 2016.

“Fees”
means, collectively, the fees due and payable pursuant to the Fee Letter, the Closing Fee, the Undrawn Fee, the Loan Administration
Fee and the Yield Maintenance Fee.

“Federal
Funds Rate” means, for any day, the rate per annum equal to the weighted average of the interest rates on overnight
federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day which is a Business
Day, the average of the quotations for the day of such transactions received by the Administrative Agent from three federal funds
brokers of recognized standing selected by it.

“First
Initial Advance” has the meaning set forth in Section 2.1(a) of the Loan Agreement.

“First
Initial Advance Acceptance” has the meaning set forth in Section 2.3(a) of the Loan Agreement.

“FTP
Site” shall mean the File Transfer Protocol Site maintained by or on behalf of the Administrative Agent.

“GAAP”
means United States generally accepted accounting principles.

“Governmental
Authority” means the government of the United States of America or any other nation, or of any political subdivision
thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.

“GWG
Holdings Indenture” means the Indenture, dated as of October 19, 2011, among the Parent, GWG Holdings, Inc. and Bank
of Utah, as trustee, as amended, supplemented, amended and restated, or otherwise modified from time to time in accordance with
the Loan Agreement.

“GWG
Note Issuance and Security Agreement” means the Third Amended and Restated Note Issuance and Security Agreement, dated
as of October 19, 2011, among the Parent, the noteholders party thereto, Lord Securities Corporation, as trustee, and GWG Lifenotes
Trust, as secured party, as amended, supplemented, amended and restated, or otherwise modified from time to time in accordance
with the Loan Agreement.

“Indemnified
Amounts” has the meaning set forth in Section 11.1 of the Loan Agreement.

“Indemnified
Bank Person” has the meaning set forth in the Account Control Agreement.

 

    	 	I-11	 

     

    

 

“Indemnified
Party” has the meaning set forth in Section 11.1 of the Loan Agreement.

“Independent
Director” has the meaning set forth in Section 9.1(f)(ii) of the Loan Agreement.

“Initial
Advance” has the meaning set forth in Section 2.1(a) of the Loan Agreement.

“Initial
Lender” shall mean LNV Corporation, a Nevada corporation.

“Initial
Policy Purchaser” means, with respect to any Policy, any Person who purchased the Policy from the Original Owner.

“Insurance
Consultant” means D3G Asset Management, LLC, a Texas limited liability company.

“Insured”
means a natural person who is named as the insured on a Policy.

“Interest
Payment Date” with respect to any Advance, means the first Distribution Date occurring after the initial funding of
such Advance, and each subsequent Distribution Date occurring thereafter.

“Interest
Period” means with respect to any Advance:

(a) 
the period commencing on the date of the initial funding of such Advance and ending on, and including, the last day of the calendar
quarter in which such initial funding occurs; and

(b) 
thereafter, each subsequent calendar quarter;

provided,
however, that if any Interest Period for any Advance that commences before the Maturity Date for such Advance would otherwise
end on a date occurring after the Maturity Date, such Interest Period shall end on and include the Maturity Date.

“Investment”
means any investment in any Person, whether by means of share purchase, capital contribution, loan, time deposit or otherwise.

“Issuing
Insurance Company” means with respect to any Policy, the insurance company that is obligated to pay the related benefit
upon the death of the related Insured (or if such Policy is a Joint Policy, upon the death of the last Insured to die under such
Policy) by the terms of such Policy (or the successor to such obligation).

“Joint
Policy” means a Policy with more than one Insured that pays upon the death of the last Insured to die. Unless the context
otherwise requires, joint Insureds of a Joint Policy shall collectively count, as applicable, as a “separate individual,”
as a “single insured” or as an “insured person”.

“Lender”
means each of the financial institutions party to the Loan Agreement as lender thereunder.

 

    	 	I-12	 

     

    

 

“Lender’s
Commitment” means, with respect to a Lender, the Commitment for such Lender as set forth on Schedule 2.1(a)
of the Loan Agreement or in the Assignment and Assumption Agreement pursuant to which such Lender becomes a party to the Loan
Agreement.

“Lender
Note” and “Lender Notes” each has the meaning set forth in Section 2.5 of the Loan Agreement.

“Lender
Valuation” means, with respect to an Advance, the value of the Subject Policies as determined by the Required Lenders
in their sole and absolute discretion, and with respect to the Collateral, the value of the Pledged Policies (other than the Excluded
Policies) as determined by the Required Lenders in their sole and absolute discretion and giving pro-forma effect to pending sales
of one or more Pledged Policies pursuant to Section 2.7 of the Loan Agreement. The Borrower and Required Lenders hereby acknowledge
that the methodology and metrics utilized by the Required Lenders in determining the Lender Valuation may be different than the
methodology and metrics utilized by the Borrower and its Affiliates in determining the value of the Pledged Policies in connection
with preparing the financial statements of the Borrower and its Affiliates and that such methodology and metrics utilized by the
Required Lenders may change over time.

“LIBOR”
means, for any Interest Period, the greater of (i) an interest rate per annum (rounded upwards, if necessary, to the nearest 1/100
of 1%) equal to the British Bankers Association LIBOR Rate or any rate established by a successor organization (“BBA LIBOR”)
by Bloomberg, Reuters or other commercially available source providing quotations of BBA LIBOR, as designated by the Administrative
Agent from time to time, at approximately 11:00 A.M. (London time) on the Rate Calculation Date for such Interest Period, as the
London interbank offered rate for deposits in Dollars for a 12-month period and (ii) one percent (1.00%).

“Lien”
shall mean any mortgage, pledge, assignment, lien, security interest or other charge or encumbrance of any kind, including the
retained security title of a conditional vendor or a lessor.

“Life
Expectancy” means with respect to an Insured, the life expectancy, expressed in months, of such Insured as stated in
the related LE Report; provided, that if an LE Report provides the life expectancy under multiple methodologies, the “Life
Expectancy” of the Insured shall be the life expectancy designated as the median (or 50th percentile) life expectancy in
such LE Report.

“Life
Expectancy Report” or “LE Report” means, with respect to an Insured, an assessment by a Pre-Approved
Medical Underwriter in a written statement as reviewed and approved by the Administrative Agent in its reasonable discretion and
dated within one-hundred eighty (180) days prior to the Advance Date on which the Policy related to such Insured became or is
proposed to become a Pledged Policy, with respect to the life expectancy of such Insured.

“Liquidated
Policy” means any Pledged Policy that has been liquidated by the death of the related Insured.

“Liquidation
Proceeds” means any and all proceeds realized from Liquidated Policies.

 

    	 	I-13	 

     

    

 

“LLC
Agreement” means the limited liability company agreement of the Borrower, dated effective as of May 18, 2016, by and
between the Parent, as member, and Albert Fioravanti, as independent director, as amended, supplemented, amended and restated,
or otherwise modified from time to time in accordance with the Loan Agreement.

“Loan
Administration Fee” means, so long as any Advance is outstanding, (i) if no Event of Default or Unmatured Event of Default
has occurred and is continuing, $50,000 per annum or (ii) if an Event of Default or Unmatured Event of Default has occurred and
is continuing, $75,000 per annum, which amount shall be pro-rated for the period the Event of Default or Unmatured Event of Default
continues.

“Loan
Agreement” means the Loan and Security Agreement, dated as of the Closing Date, among the Borrower, the Lenders party
thereto and the Administrative Agent, as may be amended, restated, supplemented or otherwise modified from time to time.

“LTV”
means, on any date of determination, the fraction, expressed as a percentage, the numerator of which is the aggregate outstanding
principal balance of all outstanding Advances, and the denominator of which is the Lender Valuation of the Pledged Policies (other
than any Excluded Policies), as determined by the Required Lenders in their sole and absolute discretion.

“Material
Adverse Effect” means, with respect to any event or circumstance, a material adverse effect on:

(a) 
any of the Collateral or the business, assets, financial condition or operations of the Borrower or the Parent;

(b) 
the ability of the Borrower or the Parent to perform its respective obligations under any Transaction Document to which such Person
is a party;

(c) 
the validity or enforceability against the Borrower or the Parent of any Transaction Document to which such Person is a party;

(d) 
the status, existence, perfection or priority of the Administrative Agent’s (for the benefit of the Secured Parties) security
interest in any of the Collateral;

(e) 
the Lender Valuation, the Net Death Benefit or the number of Pledged Policies, including without limitation, the validity, enforceability
or collectability of Pledged Policies; or

(f) 
any of the rights or interests of the Administrative Agent or any of the Lenders under the Loan Agreement or under any other Transaction
Document.

“Maturity
Date” means September 14, 2026.

“Moody’s”
means Moody’s Investors Service, Inc. and its successors.

 

    	 	I-14	 

     

    

 

“Net
Death Benefit” means, with respect to a Policy, the amount projected to be paid by the Issuing Insurance Company to
the Borrower or the Securities Intermediary on its behalf as a result of the death of the related Insured.

“Net
Proceeds” shall mean, with respect to a sale pursuant to Section 2.7 of the Loan Agreement, all proceeds of such
sale net of the lesser of (x) the reasonable third-party out-of-pocket expenses incurred by the Borrower which have been approved
by the Administrative Agent in its sole and absolute discretion and (y) the greater of (i) $20,000 and (ii) one percent (1.00%)
of the face amount of the Pledged Policies related to such sale.

“Obligations”
means all obligations (monetary or otherwise) of the Borrower to the Lenders or the Administrative Agent and their respective
successors, permitted transferees and assigns arising under or in connection with the Loan Agreement, the Lender Notes and each
other Transaction Document, in each case however created, arising or evidenced, whether direct or indirect, absolute or contingent,
now or hereafter existing, or due or to become due.

“OFAC”
has the meaning set forth in Section 8.1(v)(i) of the Loan Agreement.

“OFAC
Listed Person” has the meaning set forth in Section 8.1(v)(i) of the Loan Agreement.

“OFAC
Sanctions Program” means any economic or trade sanction that OFAC is responsible for administering and enforcing. A
list of OFAC Sanctions Programs may be found at http://www.ustreas.gov/offices/enforcement/ofac/programs/.

“Ongoing
Maintenance Advance” shall mean an Advance made after the date of the making of the First Initial Advance, the proceeds
of which are used solely to pay amounts permitted pursuant to Section 2.8(a)(ii) of the Loan Agreement.

“Ongoing
Maintenance Costs” means (i) the scheduled Premiums on the Pledged Policies (other than Excluded Policies) as set forth
on the related Premium Payment Schedule and set forth in the related Annual Budget which has been approved by the Required Lenders
pursuant to Section 9.1(d)(vi) of the Loan Agreement, as adjusted by the Administrative Agent to reflect any maturities or sales
of Pledged Policies and any Advances and (ii) the Expenses of the Borrower.

“Operational
Plan” means a cash flow-projection for the Pledged Policies which constitute the Collateral (including any Additional
Policies), through the date on which no further Premiums will be required to keep the Pledged Policies in full force and effect,
assuming that none of such Policies shall mature in such period, reasonably acceptable to the Administrative Agent and the Insurance
Consultant.

“Original
Owner” means, with respect to a Policy, the Person to which the Policy was initially issued and who was listed as owner
on the initial declarations page of such Policy or the policy application, as applicable.

“Parent”
means GWG Life, LLC, a Delaware limited liability company.

 

    	 	I-15	 

     

    

 

“Parent
Obligations” shall mean, collectively, the Parent’s obligations under the Purchase Agreement, including, without
limitation, the obligation of the Parent to repurchase Pledged Policies in accordance with the terms thereof, including, without
limitation, obtaining the Administrative Agent’s direction with respect to any such repurchase.

“Payment
Account” has the meaning set forth in Section 5.1(e) of the Loan Agreement.

“Payment
Instructions” has the meaning set forth in Section 5.2(a) of the Loan Agreement.

“Payoff
Notice” has the meaning set forth in Section 7.5(b) of the Loan Agreement.

“PBGC”
means the Pension Benefit Guaranty Corporation or any entity succeeding to any or all of its functions under ERISA.

“Permissible
Sale” has the meaning set forth in Section 2.7 of the Loan Agreement.

“Permitted
Investment” means, at any time:

(a) 
marketable obligations issued by or the full and timely payment of which is directly and fully guaranteed or insured by the United
States government or any other government with an equivalent rating, or any agency or instrumentality thereof when such marketable
obligations are backed by the full faith and credit of the United States government or such other equivalently rated government,
as the case may be, but excluding any securities which are derivatives of such obligations;

(b) 
demand deposits, time deposits, bankers’ acceptances and certificates of deposit of any domestic commercial bank or
any United States branch or agency of a foreign commercial bank which (i) has capital, surplus and undivided profits in
excess of $100,000,000 and which has a commercial paper or certificate of deposit rating in the highest rating category by
Moody’s and in one of the two highest rating categories by S&P or (ii) is set forth in a list (which may be updated
from time to time) approved in writing by the Administrative Agent on behalf of the Required Lenders; and

(c) 
the Securities Intermediary Funds (as defined in the Account Control Agreement) and any other investment approved in writing
by the Administrative Agent on behalf of the Required Lenders in its sole and absolute discretion.

“Person”
means an individual, partnership, corporation (including a business trust), limited liability company, joint stock company, trust,
unincorporated association, joint venture, government or any agency or political subdivision thereof or any other entity.

“Physician’s
Competency Statement” means, with respect to an Insured, a letter issued by such Insured’s attending physician
confirming that such Insured is mentally competent as of the date of such letter.

“Pledged
Policy” means each Policy pledged to secure Advances under the Loan Agreement.

 

    	 	I-16	 

     

    

 

“Policy”
means any life insurance policy.

“Policy
Account” has the meaning set forth in the Account Control Agreement.

“Policy
Illustration” means, with respect to any Policy, a level premium, policy values and Net Death Benefit projection produced
by the Issuing Insurance Company or an agent of the Issuing Insurance Company, using the Issuing Insurance Company’s current/non-guaranteed
values (with a non-guaranteed interest crediting rate not to exceed two-hundred (200) basis points over the guaranteed rate) sufficient
to carry such Policy to its Policy Maturity Date, which Policy Illustration is not dated more than one-hundred eighty (180) days
prior to the applicable Advance Date.

“Policy
Loan” means with respect to a Policy, an outstanding loan secured thereby or that has setoff rights with respect thereto.

“Policy
Maturity Date” means, with respect to a Policy, the date specified in the Policy, including any extensions thereto available
and exercised under the terms of the Policy, on which coverage offered under the Policy terminates.

“Pre-Approved
Medical Underwriters” means any two (2) of Fasano, AVS or 21st Services.

“Premium”
means, with respect to any Pledged Policy, as indicated by the context, any past due premium with respect thereto, or any scheduled
premium.

“Premium
Payment Schedule” has the meaning set forth in the Servicing Agreement.

“Priority
of Payments” means the priority of payments set forth in Section 5.2 of the Loan Agreement.

“Proposed
Additional Policy Advance” has the meaning set forth in Section 2.3(d) of the Loan Agreement.

“Proposed
Additional Policy Advance Notice” has the meaning set forth in Section 2.3(d) of the Loan Agreement.

“Proposed
First Initial Advance” has the meaning set forth in Section 2.3(a) of the Loan Agreement.

“Proposed
First Initial Advance Notice” has the meaning set forth in Section 2.3(a) of the Loan Agreement.

“Protective
Advances” has the meaning set forth in Section 2.1(d) of the Loan Agreement.

“Purchase
Agreement” means the Portfolio Purchase and Sale Agreement, dated as of September 14, 2016, by and between the Parent
and the Borrower, as the same may be amended, supplemented or otherwise modified from time to time in accordance with the Transaction
Documents.

 

    	 	I-17	 

     

    

 

“Rate
Calculation Date” means for any Interest Period, the last Business Day of the immediately preceding calendar quarter;
provided, however, that with respect to the initial Interest Period for the First Initial Advance and the Second
Initial Advance, the Rate Calculation Date shall be the related Advance Date.

“Receiving
Party” has the meaning set forth in Section 13.12 of the Loan Agreement.

“Reduction
Action” shall mean any action, inaction, transaction, event and/or circumstance, in each case, the result of which reduces
the amount of interest payable by the Borrower under the Loan Agreement (including, without limitation, the replacement or exchange
of one or more Lender Notes), that would otherwise have been payable if no such action, inaction, transaction, event and/or circumstance
had occurred.

“Regulatory
Change” means, relative to any Affected Party:

(a) 
any change in (or the adoption, implementation, change in the phase-in or commencement of effectiveness of) any:
(i) United States Federal or state law or foreign law applicable to such Affected Party, (ii) regulation,
interpretation, directive, requirement or request (whether or not having the force of law) applicable to such Affected Party
of (A) any court or government authority charged with the interpretation or administration of any law referred to in clause
(a)(i), or of (B) any fiscal, monetary or other authority having jurisdiction over such Affected Party, or (iii) GAAP or
regulatory accounting principles applicable to such Affected Party and affecting the application to such Affected Party of
any law, regulation, interpretation, directive, requirement or request referred to in clause (a)(i) or (a)(ii)
above;

(b) 
any change in the application to such Affected Party of any existing law, regulation, interpretation, directive, requirement,
request or accounting principles referred to in clause (a)(i), (a)(ii) or (a)(iii) above; or

(c) 
the issuance, publication or release of any regulation, interpretation, directive, requirement or request of a type described
in clause (a)(ii) above to the effect that the obligations of any Lender hereunder are not entitled to be included in the
zero percent category of off-balance sheet assets for purposes of any risk-weighted capital guidelines applicable to such Lender
or any related Affected Party.

For
the avoidance of doubt, any interpretation of Accounting Research Bulletin No. 51 by the Financial Accounting Standards Board
(including, without limitation, Interpretation No. 46: Consolidation of Variable Interest Entities) shall constitute a Regulatory
Change, regardless of whether it occurred before or after the date hereof.

“Representatives”
has the meaning set forth in Section 13.12 of the Loan Agreement.

 

    	 	I-18	 

     

    

 

“Required
Amortization” means, with respect to any Distribution Date, the greater of (A) the product of (i) the principal
amount of the Initial Advance made under the Loan Agreement and (ii) two percent (2%) and (B) the product of (i) the aggregate
principal amount of all Advances outstanding under the Loan Agreement, calculated on the last Business Day of the calendar month
immediately preceding such Distribution Date and (ii) two percent (2%).

“Required
Lenders” means Lenders holding more than fifty percent (50%) of the aggregate Commitments.

“Rescission
Period” means, with respect to any Policy, the contractual or statutory period during which the related Original Owner
or any other Person can rescind the sale of such Policy to the Initial Policy Purchaser.

“Reserve
Account” has the meaning set forth in Section 5.1(b) of the Loan Agreement.

“Reserve
Account Required Amount” means, as of each Distribution Date, the amount necessary to pay projected Expenses and Debt
Service for the following twelve (12) month period, as determined by the Administrative Agent in its reasonable discretion.

“Retained
Death Benefit Policy” means a Policy in which a Person in addition to the Securities Intermediary is designated as the
“beneficiary” under such Policy by the related Issuing Insurance Company.

“S&P”
means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc. and its successors.

“Sale
Documents” mean, with respect to each Policy, all agreements, documents, assignments and instruments executed and/or
delivered by the Insured(s) or any other party in connection with the purchase of the related Policy, or the financing of such
Policy and the foreclosure or surrender of such Policy, including for each Policy: (i) the Policy and application for the Policy,
(ii) the life settlement contract between the Original Owner of the Policy and the Initial Policy Purchaser relating to the sale
of a Policy by the Original Owner to such Initial Policy Purchaser (if applicable) and the surrender, relinquishment or similar
documentation (if applicable), (iii) the life settlement application, (iv) a Policy Illustration obtained no earlier than one-hundred
eighty (180) calendar days prior to the Advance Date on which such Policy became or is proposed to be a Pledged Policy, (v) a
HIPAA Authorization for Disclosure of Protected Health Information (and any similar document) and power of attorney related to
health information, (vi) the consent of the related Insured(s), including the agreement of continued contact, (vii) list of designated
contacts, (viii) the life settlement disclosure and (ix) a copy of a document identifying the related Insured(s) issued by
a Governmental Authority which verifies the age (including date of birth) of such Insured(s) as set forth in the application for
the Policy, or their respective equivalents.

“Second
Initial Advance” has the meaning set forth in Section 2.1(a) of the Loan Agreement.

 

    	 	I-19	 

     

    

 

“Second
Initial Advance Acceptance” has the meaning set forth in Section 2.3(b) of the Loan Agreement.

“Secured
Parties” means each Lender, the Administrative Agent and the Affected Parties.

“Securities
Intermediary” means Wells Fargo, together with its successors and assigns, solely in its capacity as securities intermediary
under the Account Control Agreement.

“Servicer”
means GWG Life, LLC, a Delaware limited liability company, acting as Servicer, or any Successor Servicer.

“Servicer
Collateral Audit” means an inspection by a Lender or the Administrative Agent of the Servicer pursuant to Section 5.2
of the Servicing Agreement.

“Servicer
Report” means collectively, the reports required to be delivered by the Servicer under the Servicing Agreement pursuant
to Section 3.4 thereof.

“Servicer
Report Date” means the date the Servicer Report is to be delivered pursuant to the terms of the Servicing Agreement.

“Servicer
Termination Event” means an event or circumstance with respect to the Servicer which could cause the termination of
the Servicing Agreement in accordance with Article IX thereof.

“Servicing
Agreement” means the Servicing Agreement, dated as of September 14, 2016, by and between the Servicer and the Borrower,
as the same may be amended, supplemented or otherwise modified from time to time in accordance with the Transaction Documents.

“Servicing
Agreement Obligations” shall mean, collectively, the Servicer’s obligations under the Servicing Agreement.

“Servicing
Agreement Rights” shall mean, collectively, the Borrower’s rights under the Servicing Agreement, including, without
limitation, upon the Administrative Agent’s instruction after the occurrence of a Servicer Termination Event, terminating
the Servicing Agreement in accordance with the terms thereof.

“Servicing
Fee” has the meaning set forth in the Servicing Agreement.

“Small
Face Policy” shall mean a Policy with a face amount of $750,000 or less.

“Solvent”
means with respect to any Person that as of the date of determination that both (A)(i) the then fair saleable value of the property
of such Person is (y) greater than the total amount of liabilities (including contingent liabilities) of such Person and (z) not
less than the amount that will be required to pay the probable liabilities on such Person’s then existing debts as they
become absolute and matured considering all financing alternatives and potential asset sales reasonably available to such Person;
(ii) such Person’s capital is not unreasonably small in relation to its business or any contemplated or undertaken transaction;
and (iii) such Person does not intend to incur, or believe (nor should it reasonably believe) that it will incur, debts beyond
its ability to pay such debts as they become due; and (B) such Person is “solvent” within the meaning given that term
and similar terms under Applicable Laws relating to fraudulent transfers and conveyances. For purposes of this definition, the
amount of any contingent liability at any time shall be computed as the amount that, in light of all of the facts and circumstances
existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability.

 

    	 	I-20	 

     

    

 

“Subject
Policy” means, with respect to an Advance, an Eligible Policy proposed to be pledged by the Borrower in connection with
such Advance.

“Subsequent
Advance Acceptance” shall have the meaning specified in Section 2.3(c) of the Loan Agreement.

“Subsequent
Advance Date” with respect to an Additional Policy Advance or an Ongoing Maintenance Advance, shall mean the date such
Advance is made pursuant to and in accordance with the terms of the Loan Agreement.

“Subsidiary”
means, with respect to any Person, any corporation or other entity of which securities or other ownership interests having ordinary
voting power (other than securities or other ownership interests having such power only by reason of the happening of a contingency
which has not occurred) to elect a majority of the Board of Directors or other Persons performing similar functions are at the
time directly or indirectly owned by such Person.

“Successor
Servicer” means a successor servicer appointed pursuant to and in accordance with the terms of the Servicing Agreement.

“Tax”
or “Taxes” means any and all fees (including documentation, recording, license and registration fees), taxes
(including net income, gross income, franchise, value added, ad valorem, sales, use, property (personal and real, tangible and
intangible) and stamp taxes), levies, imposts, duties, charges, assessments or withholdings of any nature whatsoever, general
or special, ordinary or extraordinary, together with any and all penalties, fines, additions to tax and interest thereon, imposed
on a Person or for which a Person is liable either directly or by way of an obligation to reimburse or indemnify. For the avoidance
of doubt, any reference to “Tax” or “Taxes” imposed on the Borrower shall include any tax withholdings
on income allocated to or amounts payable to the Borrower and any tax required to be paid by the Borrower to any taxing authority
or required to be withheld from any payment made by or on behalf of the Borrower, but such reference shall not include any Taxes
imposed upon anyone else unless such Taxes are in whole or in part the legal responsibility or legal obligation of the Borrower
or can otherwise be collected from the assets or income of the Borrower.

“Transaction
Documents” means the Loan Agreement, the Servicing Agreement, the Purchase Agreement, the Fee Letter, the Account Control
Agreement, the Lender Notes, that certain Service Agreement, dated as of September 14, 2016, by and between the Borrower and the
Corporate Services Provider, and the UCC financing statements filed in connection with any of the foregoing, and in each case
any other agreements, instruments, certificates or documents delivered or contemplated to be delivered in connection therewith,
as any of the foregoing may be amended, supplemented, amended and restated, or otherwise modified from time to time in accordance
with the Loan Agreement.

 

    	 	I-21	 

     

    

 

“UCC”
means the Uniform Commercial Code as from time to time in effect in the applicable jurisdiction or jurisdictions.

“Undrawn
Fee” means, with respect to each Distribution Date, a fee to be calculated as follows: for each day in the related Borrowing
Base Period, a fraction, the numerator of which is equal to the product of (i) the sum of (a) LIBOR and (b) two and one-half percent
(2.50%) and (ii) the positive difference, if any, between the Borrowing Base on such date and the aggregate principal amount of
all of the Advances outstanding under the Loan Agreement on such date (including any Protective Advances), and the denominator
of which is 360. Notwithstanding the foregoing, if on the first day of any Borrowing Base Period, the difference between the Borrowing
Base on such date and the aggregate principal amount of all of the Advances outstanding under the Loan Agreement on such date
(including any Protective Advances) is greater than zero and the Lenders make an Ongoing Maintenance Advance to the Borrower in
accordance with the terms and conditions of the Loan Agreement within five (5) Business Days after such date, so long as after
the making of such Ongoing Maintenance Advance, the difference between the Borrowing Base on the related Advance Date and the
aggregate principal amount of all of the Advances outstanding under the Loan Agreement on such Advance Date (including any Protective
Advances) is zero, then no Undrawn Fee shall be due or payable on the related Distribution Date.

“Unmatured
Event of Default” shall mean any event that, if it continues uncured, will, with lapse of time or notice or both, constitute
an Event of Default.

“Valuation
Dispute” has the meaning set forth in Section 7.5(b) of the Loan Agreement.

“Wells
Fargo” means Wells Fargo Bank, N.A.

“Yield
Maintenance Fee” means, with respect to the prepayment or repayment of an Advance that is made within sixty (60) months
after the Closing Date or a Reduction Action in respect of an Advance that occurs within sixty (60) months after the Closing Date,
an amount equal to the Applicable Margin on the amount of such prepayment or repayment or the amount of the reduction of such
Advance as a result of such Reduction Action, as applicable, that would have accrued from the date of such prepayment, repayment
or Reduction Action, as applicable, through the sixty (60) month anniversary of the Closing Date, discounted at the equivalent
weighted-average life U.S. Treasury yield as of the date of such prepayment, repayment or Reduction Action, as applicable, and,
if applicable, assuming the earliest Advance made is repaid first.

 

 

I-22

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00262-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00262-of-00352.parquet"}]]