Document:

exv10w19

Exhibit 10.19

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

Execution Copy

Imperial Holdings LLC

701 Park of Commerce Boulevard, Suite 301

Boca Raton, FL 33487

March 13, 2009

	 	 	Lexington Insurance Company c/o

AIG Risk Finance

70 Pine Street, 5th Floor

New York, New York 10270

Attention: President
	 
	 	 	National Fire & Marine Insurance Company 100

First Stamford Place

Stamford, CT 06902

Attention: General Counsel

Ladies and Gentlemen:

     This letter agreement (including any exhibits hereto, this “Letter Agreement”)
relates to (i) Lender Protection Insurance Policy (Policy No. 7113486), issued by Lexington
Insurance Company (the “Insurer”) to Imperial Life Financing II, LLC, a Georgia limited
liability company (the “Insured”), effective as of the date hereof (as amended,
supplemented or otherwise modified from time to time, the “Policy”), a copy of which is
attached as Exhibit A hereto and (ii) Contingent Lender Protection Insurance Policy
(Policy No. 92 SRD 102507), issued by National Fire & Marine Insurance Company (the
“Contingent Insurer” and together with the Insurer, the “LPIC Insurers” and each
an “LPIC Insurer”) to the Insured, effective as of the date hereof (as amended,
supplemented or otherwise modified from time to time, the “Contingent Policy”), a copy of
which is attached as Exhibit B hereto. Any capitalized term used in this Letter Agreement
but not defined herein (including in Section 12 hereof) shall have the meaning set forth in the
Policy.

     We, Imperial Holdings LLC, a Florida limited liability company (“we” or the
“Company”), have caused the Retail Lender to enter into (i) a Master Participation
Agreement dated as of the date hereof (as amended, supplemented or otherwise modified from time to
time, the “Master Participation Agreement”), between the Retail Lender, as seller, and the
Insured, as purchaser, pursuant to which the

Retail Lender has agreed to sell and transfer without recourse, and the Insured
has agreed to purchase a participation interest in certain insurance premium loans and (ii)
certain Insurance Premium Loan Sale and Assignment Agreements (as amended, supplemented or
otherwise modified from time to time, each an “Assignment
Agreement”), between the Retail Lender,
as assignor, and the Insured, as assignee, pursuant to which the

 

 

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

Retail Lender has agreed to sell and
assign to the Insured, and the Insured has agreed to purchase and assume, certain insurance
premium loans.

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

 

 

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

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

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

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

	 	(vi)	 	No action, suit, investigation or proceeding is pending or, to the knowledge of the Company,
threatened before any court or governmental body seeking any determination or ruling that
could materially and adversely affect the performance by the Company of its obligations under
this Letter Agreement.
	 
	 	(vii)	 	(A) The Company has delivered to the Insurer on or prior to the date hereof true and
accurate copies of the Loan Documents; (B) the Company shall, upon the request of the Insurer
or the Contingent Insurer from time to time and at the Company’s expense, deliver to the
requesting LPIC Insurer true and accurate copies of the then-current Loan Documents and any
other agreements or documents being used by the Company, any Retail Lender or any of its or
their Affiliates in connection with the issuance of Retail Loans that relate to Covered Loans;
and (C) in the case of any amendment or modification of any Loan Document that the Company
reasonably believes is material and/or likely to adversely affect the interests of the Insurer
or the Contingent Insurer (which shall include, without limitation, any amendment or
modification to (x) Section 6 of the Insured Disclosure Statement, Representations and
Warranties, and Consent provided to the Insurer in accordance with subsection (A) above, which
Section 6 provides disclosure concerning the existence of limited insurance capacity and (y)
the definition and related calculation of the “Yield Maintenance Premium”), the Company shall
not utilize such amended or modified form until (I) it has notified the Insurer (prior the
occurrence of a Credit Event) or the Contingent LPIC Insurer (following the occurrence of a
Credit Event) thereof (specifying the reasons for such amendments or modifications and whether
any relevant governmental authority has suggested, requested or mandated such amendments or
modifications) and (II) the date, if any, on which the relevant LPIC Insurer provides written
notice that it has no objection to such amendment or modification in writing (any such notice
of no objection by any LPIC Insurer not to be unreasonably withheld, and the applicable LPIC
Insurer’s failure to deliver a written notice of no objection on or prior to the tenth (1
0th) Business Day following the date on which the Company supplied such amended or
modified form (and such related information) to the relevant LPIC Insurer being deemed to be
delivery by such relevant LPIC Insurer of notice of objection as of such date). In the event
that the Company believes that it is prudent to amend or modify any Loan Document in a manner
which the Company does not reasonably believe to be material or reasonably believes is not
likely to adversely affect the interests of the Insurer or the Contingent Insurer
(“Non-material Modification”), the Company may nonetheless solicit the Insurer’s
(prior to the occurrence of a Credit Event) or the Contingent Insurer’s (following the
occurrence of a Credit Event) lack of objection to such amendment or modification, as the case
may be, stating the reasons for such amendments or modifications and whether any relevant
governmental authority has suggested, requested or mandated such amendments or modifications
and stating in writing that the Company believes the amendment or modification is a
Non-material Modification; the relevant LPIC Insurer’s failure to deliver written notice of

3

 

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

	 	 	 	objection on or prior to the tenth (10th) Business Day following the date on which the
Company supplied such amended or modified form (and such related information) to the
relevant LPIC Insurer being deemed to be delivery by such LPIC Insurer of notice of no
objection to such Non-material Modification as of such date.

	 	(viii)	 	The Company or an Affiliate will obtain a legal opinion or legal memorandum from outside
local counsel to the Company or such Affiliate (each such legal opinion or legal memorandum
shall be addressed to the Company or such Affiliate and is referred to herein as a “Local
Counsel Opinion”) qualified to practice in the states of Georgia, Mississippi and Utah
(each, a “Loan State”) no later than sixty (60) days after the date hereof, addressing
each of the questions set forth on Exhibit C hereto (such questions being, the
“Loan State Local Counsel Questions”) pursuant to the laws, rules and regulations of
such jurisdiction as in effect as of the date of such Local Counsel Opinion. The Company
acknowledges that notwithstanding any other provision of the Policy, this Agreement, the
Services and Remarketing Agreement or any other document or agreement entered into by the
Insurer, the Insurer shall not be obligated to issue any Coverage Certificates that relate to
Retail Loans made in the states of Georgia, Mississippi or Utah after the day on which such
sixty (60) day period has elapsed if the Insurer has not received a copy of a Local Counsel
Opinion covering the law of such state prior to the end of such sixty (60) day period.
	 
	 	(ix)	 	The Company or an Affiliate will obtain a Local Counsel Opinion from outside local counsel to
the Company or such Affiliate qualified to practice in the states of California, Florida and
New York (each, a “Policy State”) no later than sixty (60) days after the date hereof,
addressing each of the questions set forth on Exhibit D hereto (such questions being,
the “Policy State Local Counsel Questions”) pursuant to the laws, rules and
regulations of such jurisdiction as in effect as of the date of such Local Counsel Opinion.
The Company acknowledges that notwithstanding any other provision of the Policy, this
Agreement, the Services and Remarketing Agreement or any other document or agreement entered
into by the Insurer, the Insurer shall not be obligated to issue any Coverage Certificates
that relate to life insurance policies issued by Life Insurance Carriers in a Policy State
after the day on which such sixty (60) day period has elapsed if the Insurer has not received
a copy of a Local Counsel Opinion covering the law of such Policy State prior to the end of
such sixty (60) day period.
	 
	 	(x)	 	The Company will obtain a bring-down of each Local Counsel Opinion delivered in accordance
with clauses (viii) and (ix) immediately above on or prior to April 15 (but not prior to
April 1) of each year beginning in April 2010; provided that, if the Company or an Affiliate
provides the Insurer with a bring-down of a Local Counsel Opinion for a particular
jurisdiction meeting this requirement in connection with another transaction between the
Insurer and the Company, then such bring-down of the Local Counsel

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

	 	 	 	Opinion will satisfy this requirement. Notwithstanding the foregoing, the Company or an
Affiliate may obtain a new Local Counsel Opinion in lieu of a bring-down Local Counsel
Opinion otherwise required by this clause (ix) so long as such new Local Counsel Opinion
is dated a date in April of the applicable year and addresses each Loan State Local Counsel Opinion Question or
each Policy State Local Counsel Opinion Question, as
applicable, pursuant to the laws, rules and regulations of the applicable jurisdiction
as in effect as of the date of such new Local Counsel Opinion;
provided that, if the Company or an Affiliate obtained a Local Counsel Opinion with respect
to the laws, rules and regulations of a jurisdiction pursuant to clause (viii) or (ix)
immediately above dated any time from March 1 of a given year to April 15 of such year,
then the Company shall not be required to deliver a bring-down of such Local Counsel
Opinion until April of the following year. The Company will and will cause each other
Imperial Party to conform its conduct accordingly in all material respects to
the Local Counsel Opinions or the bring-downs of such Local Counsel Opinions, as
applicable.

	 	(xi)	 	Each LPIC Insurer shall have the right, but not the obligation, from time to time to examine
or audit all of the Company’s and/or any other Imperial Party’s books and records that relate
to the coverage provided by the Policy and the Contingent Policy. The relevant LPIC Insurer
shall notify the Company of such an inspection at least five (5) Business Days in advance. To
the extent that such books and records are to be maintained by a third party on behalf of an
Imperial Party, the Company shall, and shall cause the relevant Imperial Party to, ensure that
any related agreement with such third party allows for the relevant LPIC Insurer to examine
such books and records and the Company shall direct such third party to allow the relevant
LPIC Insurer to examine such books and records in accordance with this paragraph. Each LPIC
Insurer may appoint an Affiliate to conduct the examinations and audits permitted by this
clause (x).

	 	(xii)	 	Upon the commission of an Imperial Prohibited Act by (A) an employee or agent of the Company
or any other Imperial Party or (B) any life insurance agents, any life insurance brokers or
any life insurance producers, in each case acting in such capacity, the Company shall, and
shall cause each other Imperial Party to, take (I) prompt commercially reasonable corrective
action, including, but not limited to, prohibiting each applicable employee or agent from
working on any further matters that relate to the Insurer and (II) all commercially reasonable
action that may be necessary to promptly identify to the Insurer all outstanding
Pre-Certificate Review Submissions attributable in any way to such employee or agent.
	 
	 	(xiii)	 	The Company shall notify the Insurer (prior to the occurrence of a Credit Event) or the
Contingent Insurer (following the occurrence of a Credit Event) within five (5) Business Days
of an Authorized Officer becoming aware of (A) any Prohibited Act or Imperial Prohibited Act
by any Person or an

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

	 	 	 	employee or agent of any Person (including, without limitation, any life insurance
agents, any life insurance brokers or any life insurance producers, in each case acting
in such capacity), or (B) Advised Conduct which is not, or is likely not, to be in
compliance with any law, rule or regulation then in effect in a relevant jurisdiction.

	 	(xiv)	 	The Company has, and shall maintain, members’ equity of not less than $[*]. The Company
shall provide a certificate signed by its chief executive officer evidencing its satisfaction
of this covenant (1) to the Insurer on the date hereof and (2) to the Insurer (prior to the
occurrence of a Credit Event) or the Contingent Insurer (following the occurrence of a Credit
Event) quarterly, on or before the date that is thirty (30) days after the end of each fiscal
quarter of the Company that occurs during the term of this Letter Agreement.
	 
	 	(xv)	 	The Company has, and shall maintain during the term of this Letter Agreement and for at
least a one (1) year period immediately following the term of this Letter Agreement, an
errors and omissions insurance policy insuring against errors and omissions exposures
relating to or arising out of activities of the Company or any other Imperial Party in
connection with the transactions to which this Letter Agreement relates (including, without
limitation, the activities of the Company in connection with this Letter Agreement and the
activities of Imperial Life and Annuity Services, LLC in connection with the Services and
Remarketing Agreement) having a per occurrence limit of at least $[*] and an aggregate limit
of at least $[*] from a U.S. carrier rated at least “A” by Standard & Poor’s Rating
Services, a division of the McGraw Hill Companies, Inc., or at least “A2” by Moody’s
Investor Service Inc. (an “E&O Policy”).
	 
	 	(xvi)	 	Neither the Company nor any person or entity that holds a direct or indirect interest in the
Company or any other Imperial Party is (i) a person or entity listed in the Annex to Executive
Order No. 13224 (2001) issued by the President of the United States (Executive Order Blocking
Property and Prohibiting Transactions with Persons Who Commit, Threaten to Commit, or Support
Terrorism), or (ii) named on the List of Specially Designated Nationals and Blocked Persons
maintained by the U.S. Office of Foreign Assets Control.
	 
	 	(xvii)	 	The Company is an “accredited investor” as that term is defined in Rule 501 of
Regulation D under the Securities Act of 1933, as amended.
	 
	 	(xviii)	 	The Company shall, upon the request of either LPIC Insurer and at the Company’s expense,
provide the relevant LPIC Insurer with identifying information regarding the Company in
connection with the requirements of the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (“USA
Patriot Act”), Pub. L., 107-56, 115 Stat. 380 (October 26, 2001), as amended.

6

 

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

	 	(xix)	 	The Company (A) has performed analyses in respect of FASB Interpretation No. 46 (“Consolidation
of Variable Interest Entities”) as in effect on the date hereof and (B) represents and
warrants to the Insurer as of the date hereof that, based upon such analyses, the Company will
consolidate the financial position and results of the Insured in the consolidated financial
statements of the Company. In addition, the Company covenants to each LPIC Insurer that the
Company will notify each LPIC Insurer in writing in the event that the Company changes its
conclusion regarding the consolidation of the Insured.
	 
	 	(xx)	 	If, at any time on or after the date of this Letter Agreement, the premium finance program
of the Retail Lender referenced in this Letter Agreement is “approved” or “reviewed” by a
life insurance carrier, the Company shall provide written notice of such approval or review
to the Insurer (prior to the occurrence of a Credit Event) or the Contingent Insurer
(following the occurrence of a Credit Event) within ten (10) Business Days of the Company
learning of such approval or review.
	 
	 	(xxi)	 	The Company shall (i) promptly provide to the Insurer (prior to the occurrence of a Credit
Event) or the Contingent Insurer (following the occurrence of a Credit Event) a copy of all
notices delivered by the Insured as borrower pursuant to Section 7.01(a)(i), (ii), (viii) or
(x) of the Wholesale Loan Agreement and (ii) cause the Insured to comply with the terms of
the Policy and the Contingent Policy and comply with the representations, warranties and
covenants of the Insured set forth in the Policy and the Contingent Policy.
	 
	 	(xxii)	 	The Company shall not permit the Retail Lender to sell, assign or otherwise transfer any
Retail Loan that relates to a Covered Loan or any interest therein to any Person other than
the Insured pursuant to the Master Participation Agreement or an Insurance Premium Loan Sale
and Assignment Agreement.
	 
	 	(xxiii)	 	The Company shall not permit the Retail Lender to make Retail Loans that relate to
Covered Loans in any state other than the states of Georgia, Mississippi or Utah.
	 
	 	(xxiv)	 	The Company shall provide a written report to the Insurer within thirty (30) days after
the date hereof providing a breakdown by state of:

	 	(A)	 	the state of residence of each “Underlying Life” as indicated in each
“Covered Policy” or related policy documentation;
	 
	 	(B)	 	the state of residence or domicile of each life insurance policy owner as
indicated in each “Covered Policy” or related policy documentation; and
	 
	 	(C)	 	each “Retail Borrower’s” state of domicile as of the effective date of
the related “Retail Loan”,

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

	 	 	 	in each case, with respect to the number of life insurance policies issued by
life insurance carriers that relate to coverage certificates issued by the
Insurer or its affiliates to or for the benefit of the Company or its Affiliates
prior to the date hereof. The Insurer reserves the right to increase or decrease
the number of Policy States based on its review of such report.
	 
	 	(xxv)	 	(i) the LPIC Insurers’ identity has not been and shall not be
disclosed by any Imperial Party or, to the knowledge of any other Imperial Party,
any Responsible Party in any offering materials or discussions with rating
agencies or any life insurance company without the prior written consent of the
Insurer (which consent the Insurer can withhold in its sole and absolute
discretion) and (ii) the Policy and the Contingent Policy have not been and shall
not be referenced by any Imperial Party or, to the knowledge of any Imperial
Party, any Responsible Party in any offering materials or discussions with rating
agencies in connection with any rated or unrated securities offering without the
prior written consent of the relevant LPIC Insurer (which consent the LPIC
Insurers can withhold in their sole and absolute discretion).
	 
	 	(xxvi)	 	None of the reports, financial statements, certificates or other information
furnished by or on behalf any Imperial Party to either LPIC Insurer in connection
with the negotiation of the Imperial LPIC Documents (as modified or supplemented
by other information so furnished) contains any material misstatement of fact or
omits to state any material fact necessary to make the statements therein, in the
light of the circumstances under which it was made, not misleading;
provided that, with respect to projected financial information, the
Company represents only that such information was prepared in good faith based
upon assumptions believed to be reasonable at the time prepared.

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

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

	 	(i)	 	Such LPIC Insurer has all requisite power and authority to execute,
deliver and perform its obligations under this Letter Agreement. This Letter
Agreement has been duly authorized, executed and delivered by such LPIC Insurer
and constitutes a valid and legally binding agreement enforceable in accordance
with its terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to
or affecting creditors’ rights and to general equity principles.
	 
	 	(ii)	 	As a result of executing this Letter Agreement, such LPIC Insurer
will not be in violation of any law, statute, rule, regulation, judgment, order or
decree of any domestic or foreign court or governmental or regulatory authority,

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

	 	 	 	agency or other body having jurisdiction over such LPIC Insurer or any of its
assets or property.
	 
	 	(iii)	 	No consent, approval, authorization or order of, or filing,
registration, qualification, license or permit of or with, any domestic or
foreign court or governmental or regulatory authority, agency or other body is
required to be obtained or made by such LPIC Insurer in connection with this
Letter Agreement that has not already been obtained or made.
	 
	 	(iv)	 	No action, suit, investigation or proceeding is pending or, to the
knowledge of such LPIC Insurer, threatened before any court or governmental body
seeking any determination or ruling that could materially and adversely affect the
performance by such LPI C Insurer of its obligations under this Letter Agreement.

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

	2.	 	Enforcement of Rights and Remedies; Monetary Recoveries.

	 	(a)	 	If the Insurer or the Contingent LPIC Insurer makes a payment pursuant to the Policy
or the Contingent Policy, as the case may be, in connection with a Covered Loan or a
Covered Policy, then the Company will and will cause each other Imperial Party to use
commercially reasonable efforts to enforce all remedies available to the Company or any
such Imperial Party under the terms of each guaranty, if any, delivered by or on behalf of
a Retail Borrower pursuant to the terms of such Covered Loan (any such amount paid by the
Insurer under the Policy in connection with a Covered Loan or Covered Policy being, a
“Reimbursable Loss”). In connection with the enforcement of any such guaranty, the
Company or any other Imperial Party shall be entitled to settle any enforcement actions on
terms and provisions that it considers reasonable under the circumstances and may decline
to pursue enforcement actions in the event it considers enforcement imprudent under the
circumstances; provided that prior to settling or declining to pursue any such enforcement
action, such Imperial Party shall consult with the Insurer (prior to the occurrence of a
Credit Event) or the Contingent Insurer (following the occurrence of a Credit Event)
regarding its proposed course of action. Within seven (7) Business Days of receipt by any
Imperial Party of any monetary recovery relating to any such guaranty, the Company will
pay any such amount to the LPIC Insurer that made the related payment pursuant to the
Policy or the Contingent Policy, as the case may be, less any reasonable out-of-pocket
expenses incurred by the Company or an Affiliate in enforcing any such guaranty, with the
aggregate amount of any such payments to the relevant LPIC Insurer relating to any Covered
Loan not to exceed the amount of the Reimbursable Loss associated with such Covered Loan.
	 
	 	(b)	 	If either LPIC Insurer (i) pays a loss to the Insured pursuant to Section I of the
Policy in connection with a Covered Loan and (ii) notifies the Insured in writing,
pursuant to Section IV.F.(2) of the Policy, that the Insurer is not requiring transfer of

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

	 		 	ownership of the related Covered Policy or the Beneficial Interest in the related Trust
but is requiring the cooperation of the Insured and the Collateral Agent with regard to
such Covered Policy and, if applicable, the Beneficial Interest in the related Trust,
then the Company will cause (A) the Insured to take all commercially reasonable and
lawful actions requested by the paying LPIC Insurer in connection with Section IV.F.(2)
of the Policy and (B) the Insured to (I) instruct the Collateral Agent (or any back-up
servicing agent, if applicable) to maintain full rights in such Covered Policy or such
Beneficial Interest in the related Trust to the extent required by Section IV.F.(2) of
the Policy and to take all commercially reasonable and lawful actions requested by the
Insured (which requests of the Insured shall match the instructions received by the
Insured from the paying LPIC Insurer with respect to the actions to be taken by the
Collateral Agent (or any back-up servicing agent, if applicable)) in connection with
Section IV.F.(2) of the Policy, and (II) enforce all rights and remedies available to
the Insured should the Collateral Agent (or any back-up servicing agent, if applicable)
fail to comply with such instructions.

	3.	 	Indemnification.

	 	(a)	 	The Company agrees to indemnify and hold harmless each LPIC Insurer, its Affiliates and its and their respective officers, directors, shareholders, controlling
persons, employees, agents, advisors, successors, transferees, participants and assigns
(each of the foregoing persons being individually called an “Indemnified Party”)
from and against any and all claims, demands, damages, losses (including the full amount
of any Outstanding Loan Balance paid by such LPIC Insurer under the Policy or the
Contingent Policy, as the case may be), liabilities charges and expenses (including,
without limitation, reasonable fees and expenses of counsel) that may be incurred by or
asserted against any Indemnified Party (all of the foregoing being collectively called
“Losses”), in each case, arising out of, related to, or in connection with or by
reason of: (i) the commission of an Imperial Prohibited Act by any of an Imperial Party,
PFSC or a Corporate Trustee; (ii) any failure by any Imperial Party to comply with any
Local Counsel Opinion; (iii) any breach or alleged breach by (x) the Insured of any
representation, covenant or warranty or failure to comply with, any of the statements or
agreements set forth in any Imperial LPIC Document; (y) the Company of any representation, covenant or warranty or failure to comply with, any
of the agreements set forth in this Letter Agreement or (z) Imperial Life & Annuity
Services, LLC of any representation, covenant or warranty or failure to comply with any
of the agreements set forth in the LPIC Services and Remarketing Agreement, dated as of
the date hereof, among the Insurer, the Contingent LPIC Insurer and Imperial Life &
Annuity Services, LLC (as amended, supplemented or otherwise modified from time to
time, the “Services and Remarketing Agreement”); (iv) any failure by the Collateral Agent (or any back-up servicing agent, if applicable)
to comply with any of the terms set forth in Section IV.F.(2) of the Policy; (v)(A) any
act by an Imperial Party, a Collateral Agent, a Servicer or a Corporate Trustee or (B)
any act by a Non-Corporate Trustee occurring from and after the time when a Retail Loan
is made to the related Retail Borrower, that was, in the case of any act described in
(A) or (B), at the time any such act occurred, a fraudulent, illegal, criminal,
malicious or grossly negligent act; or (vi) the Contest of

10

 

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

	 	 	 	a Covered Policy before the related Coverage Certificate Effective Date. The
indemnification available to any Indemnified Party under this Section 3 shall not be
reduced in any way by any LPIC Premium or Contingent LPIC Premium receivable by the Insurer or the Contingent LPIC Insurer pursuant to the Policy or the Contingent
Policy, as the case may be. The Company shall remit payment with respect to a claim
for indemnification under this Section 3 within 15 Business Days of notice thereof by
an Indemnified Party. The indemnification provided by this Section 3 shall survive the
termination of this Letter Agreement.

	 	(b)	 	If for any reason the indemnification provided in this Section 3 is unavailable to an
Indemnified Party or is insufficient to hold an Indemnified Party harmless, then the
Company shall contribute to the amount paid or payable by such Indemnified Party as a
result of such loss, claim, damage or liability in such proportion as is appropriate to
reflect not only the relative benefits received by such Indemnified Party, on the one
hand, and the Company, on the other hand, but also the relative fault of such
Indemnified Party, on the one hand, and the Company, on the other hand, as well as any
other relevant equitable considerations.

	4.	 	Notices. All demands, notices and communications hereunder shall be in writing and
shall be deemed to have been duly given if personally delivered by certified mail, return
receipt requested, mailed by a nationally recognized overnight courier or sent via facsimile
to (i) the Company at 701 Park of Commerce Boulevard, Suite 301, Boca Raton, FL 33487,
Attention: Jonathan Neuman, President, facsimile: 240-282-1050, with a copy to Foley & Larder
LLP, One Independent Drive, Suite 1300, Jacksonville, FL 32202-5017, Attention: Robert S.
Bernstein, Esq., facsimile: 904-359-8700, (ii) the Insurer at 70 Pine Street, 5th
Floor, New York, New York 10270, Attention: Surveillance Department, facsimile: 212- 480-3923,
with a copy to Senior Division Counsel, AIG Risk Finance, 70 Pine Street, 5th Floor,
New York, New York 10270, 212-480-3923, (iii) National Fire & Marine Insurance Company,
Attention: General Counsel, 100 First Stamford Place, Stamford, CT 06902, Facsimile: (203)
363-5221 or (iv) as to any of such persons, at such other address or facsimile number as shall
be designated by such person in a written notice to the other persons.
	 
	5.	 	Governing Law. This Letter Agreement shall be governed by, and construed in
accordance with, the internal laws of the State of New York (including without limitation
Section 5- 1401 of the General Obligations Law of the State of New York), without regard to
conflicts of laws principles that would require or allow for the application of any other
jurisdiction’s law.
	 
	6.	 	Remedies. The rights, remedies, powers and privileges of each LPIC Insurer
provided herein shall not preclude all other rights, remedies, powers and privileges
provided to such LPIC Insurer by law.
	 
	7.	 	Setoff. Each LPIC Insurer shall have the right to setoff any amounts due from such
LPIC Insurer to the Company or any Affiliate of the Company against any amounts that are due
to such LPIC Insurer from the Company or any Affiliate of the Company.
	 
	8.	 	Dispute Resolution. Any dispute arising hereunder or relating hereto, including without
limitation any dispute relating to the validity or enforceability of this Letter Agreement,

 

 

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

	 	 	shall be submitted to the American Arbitration Association in New York, New York for
confidential, binding arbitration under and in accordance with its commercial arbitration rules
then in effect. Unless the LPIC Insurers and the Company agree in writing that there shall be
one arbitrator (in which case, there shall be one arbitrator), there shall be a total of three
arbitrators in connection with any arbitration, where the LPIC Insurers shall together choose
one arbitrator, and the Company shall choose one arbitrator and such chosen arbitrators shall
choose a third arbitrator. Each arbitrator shall be disinterested, shall have knowledge of the
legal, financial, corporate and insurance issues relevant to the matters in dispute, and shall
otherwise be chosen in the manner provided in such commercial arbitration rules. Any
arbitration shall be subject to the Federal Arbitration Act and, to the extent such Act is not
applicable, the laws of the State of New York. The arbitration dispute resolution mechanisms
set forth in this Section 8 are intended to be the sole and exclusive dispute resolution
mechanisms for any dispute arising among the LPIC Insurers and the Company hereunder or
relating hereto, including without limitation any dispute relating to the validity or
enforceability of this Letter Agreement, and shall survive the cancellation or termination of
this Letter Agreement. The decision of the arbitrator(s) shall be final and binding and
provided to all parties, and the arbitration award shall not include attorneys’ fees or other
costs. Each party shall bear the expense of its own arbitration activities, including its
appointed arbitrator and its outside attorney or witness fees, and the parties shall equally
bear the expense of the third arbitrator and the common expenses of the arbitration proceeding.
The arbitration proceeding shall be held in New York, New York.

	9.	 	Construction; Entire Agreement. Each LPIC Insurer and the Company hereby acknowledge
that they were represented by competent and experienced legal counsel of their choice in
connection with the negotiation, execution and delivery of this Letter Agreement, and the
Company acknowledges that it is entering into the transactions contemplated by this Letter
Agreement with full knowledge and acceptance of its terms, conditions and significance,
without any reliance on any representation, warranty, advice or other statement by any LPIC
Insurer or any of its representatives or advisors regarding any legal, tax or accounting
implications or other requirements. Accordingly, in any dispute concerning this Letter
Agreement, such dispute shall be resolved without any presumption or rule of construction in
favor of any party or any related or similar doctrine. This Letter Agreement contains the full
and complete understanding and agreement between the parties hereto with respect to the
subject matter hereof. The parties acknowledge that they are not entering into this Letter
Agreement in reliance upon any term, condition, representation or warranty not stated or
referred to herein and that this Letter Agreement replaces any and all prior agreements
whether oral or written, pertaining to the subject matter hereof.
	 
	10.	 	Counterparts. This Letter Agreement may be executed in any number of counterparts,
each of which shall be deemed an original and all of which taken together shall constitute one
and the same document.
	 
	11.	 	Amendments. This Letter Agreement may be amended, modified, supplemented or
terminated only by a written instrument signed by the Insurer (prior to the occurrence of a
Credit Event), the Contingent Insurer and the Company.
	 
	12.	 	Defined Terms. For purposes of this Letter Agreement:

 

 

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

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

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

“Affiliate” of any Person means any other Person that (i) directly or indirectly
controls, is controlled by or is under common control with such Person or (ii) is an officer or
director of such Person. A Person shall be deemed to be “controlled by” any other Person if such
other Person possesses, directly or indirectly, power: (i) to vote 10% or more of the securities
(on a fully diluted basis) having ordinary voting power for the election of directors or
managing partners; or (ii) to direct or cause the direction of the management and policies of
such Person whether by contract or otherwise. For the avoidance of doubt, CTL Holdings II, LLC,
a Georgia limited liability company, shall be regarded as an Affiliate of the Company for
purposes of this Letter Agreement.

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

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

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

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

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

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

“Imperial Prohibited Act” means any of the following:

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

	 	(1)	 	and/or for the purpose of encouraging the issuance of or application for such
Covered Policy or a loan supported directly or indirectly
by such Covered Policy, providing any upfront inducement
or gift valued in excess of $[*] or otherwise in
violation of applicable law for the benefit of the Retail
Borrower, any beneficiary of the Retail Borrower and/or
the Underlying Life and/or the spouse or significant
other of the Underlying Life; provided that the
conduct described in following provisions (a) and (b)
shall not constitute an upfront inducement or gift for
purposes of this clause (1) so long as such conduct does
not violate applicable law and does not result in the
Retail Borrower being entitled to 14
amounts (other than any benefit payable by the Life Insurance Carrier in connection
with a related Covered Policy) exceeding any such premium finance loan and the
reimbursed expenses described in provision (b) of this paragraph: (a) any reasonable
business marketing activity, event or meal

 

 

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

	 	 	 	conducted by any employee or Authorized Officer of the Retail Lender or any
Affiliate thereof or a Responsible Party for the benefit of the Retail Borrower, any
beneficiary of the Retail Borrower, and/or the Underlying Life and/or the spouse or
significant other of the Underlying Life, and paid for by the Retail Lender or any
Affiliate thereof or a Responsible Party without any condition that the recipient or
beneficiary thereof purchase or finance any insurance and (b) any reimbursement of
expenses incurred by the Retail Borrower and/or the Underlying Life that relate
directly to the issuance of a Covered Loan;

	 	(2)	 	causing any portion of the death benefit from such Covered Policy to be paid to parties
other than (a) those with an insurable interest in the Underlying Life, (b) beneficiaries
chosen by the Underlying Life or (c) the Retail Lender in satisfaction of the related Covered
Loan; provided that, the amount collected by the Retail Lender may not exceed the
outstanding loan principal, together with related interest and reasonable and customary
charges or fees; and provided further that if (i) the aggregate amount of charges and fees
with regard to such Covered Loan, other than LPIC Premium, does not exceed [*] percent ([*]%)
of the Covered Loan Amount or (ii) no LPIC Premium is charged directly to the Retail Borrower
and identified as such under a Covered Loan, the aggregate amount of charges and fees with
regard to such Covered Loan does not exceed the sum of [*] percent ([*]%) of the Covered Loan
Amount plus the amount of LPIC Premium paid in connection with such Covered Loan, then such
charges and fees shall be considered reasonable and customary for purposes of this clause
(2);

	 	(3)	 	requiring a borrower to sell, assign (other than through a pledge of such Covered Policy or
related Beneficial Interest as collateral and any foreclosure or liquidation of such
collateral to satisfy such loan and related amounts) or settle such Covered Policy that acts
as collateral or penalizing such borrower for not selling, assigning or settling any such
Covered Policy;

	 	(4)	 	(a) requiring a borrower to share or otherwise forfeit any proceeds derived from the future
sale, assignment or settlement of such Covered Policy (other than through a pledge of such
Covered Policy or related Beneficial Interest as collateral and any foreclosure or
liquidation of such collateral to satisfy a loan and related amounts); it being understood
that no part of this clause (a) is intended to allow the use of an interest rate that (i) is
not fixed, (ii) is not correlated to a commercially accepted index or instrument (such as
“Libor”, “prime” or a U.S. treasury bill) or (iii) may otherwise result in any Person paying
or owing any amount contingent upon the future value or sale price of a Covered Policy or
(b) requiring a borrower to consummate any such sale, assignment or settlement with a
particular agent or settlement company; or

	 	(5)	 	penalizing a borrower for prepaying any such loan other than pursuant to a
market prepayment penalty, make whole premium or early termination fee;
provided that a prepayment penalty, make whole premium or early termination
fee that (i) is consistent with the “Yield Maintenance Premium” set forth in the
Retail Loan Documents and in any event (ii) does not result in the borrower paying
more than it would have paid in full satisfaction of the Covered Loan at maturity
shall be considered a market prepayment penalty, make whole premium or early
termination fee for purposes of this clause (5);

 

 

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

or

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

	 	(2)	 	failing to take corrective action within thirty (30) days of an Authorized Officer
of the Company or an Affiliate of the Company
becoming aware that any conduct undertaken in any
jurisdiction by the Company or any Affiliate of
the Company as a result of or relating to a Local
Counsel Opinion delivered with respect to the
laws, rules or regulations of such jurisdiction
(any such conduct so undertaken being,
“Advised Conduct”) was or is, or that
there is a substantial likelihood that such
Advised Conduct was or is, not in compliance with
any law, rule or regulation then in effect in
such jurisdiction (including, without limitation,
as a result of the enactment of a new law, rule
or regulation after the date on which the Local
Counsel Opinion (or bring-down thereof) was
delivered); provided that, if (a) the Company or
any Affiliate of the Company undertakes any
Advised Conduct in a jurisdiction that it
believes, in good faith, complies in all material
respects with the facts, circumstances and/or
standards set forth in the most recent Local
Counsel Opinion (or bring-down thereof) delivered
in such jurisdiction, (b) a party asserts that
such Advised Conduct was 16
or is not in compliance (for reasons other than the enactment of a new law, rule or
regulation after the date on which such Local Counsel Opinion (or bring-down
thereof) was delivered) with any law, rule or regulation cited or referred to in
such Local Counsel Opinion (or bring-down thereof) and (c) the Company or any
Affiliate of the Company is in good faith challenging whether such Advised Conduct
was or is not in compliance with such law, rule or regulation, then an Authorized
Officer of the Company or any Affiliate of the Company (y) until the earlier of the
decision by the relevant Imperial Party to no longer continue such challenge or a
final determination has been made regarding the matter, shall not be deemed to be
aware that there is a substantial likelihood that Advised Conduct was or is not in
compliance with any such law, rule or regulation and shall not be 

 

 

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

	 	 	 	required to take corrective action with regard to such Advised Conduct and (z) shall provide prompt
written notice of the existence of any such challenge, and
the facts relating to such challenge, to the Insurer (for purposes of this clause
(B)(2), “final determination” shall mean an order of a court, a decision of an
arbitration panel or a non-appealable ruling of an administrative law tribunal, in
each case with jurisdiction over the matter); or

	 	(3)	 	failing to provide written notice to the Insurer (prior to the occurrence of a Credit
Event) or the Contingent Insurer (following the occurrence of a Credit Event)
within thirty (30) days following any Authorized Officer of the Company or any
Affiliate of the Company obtaining knowledge that a Prohibited Act or an Imperial
Prohibited Act has been committed.

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

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

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

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

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

“Loan Documents” means (a) the Master
Participation Agreement, (b) each Assignment
Agreement and (c) for each Covered Loan, the
relevant documents entered into in connection
with the issuance of such Covered Loan, including
without limitation the relevant loan application
and agreement; promissory note; escrow agreement;
beneficiary pledge agreement; assignment of life
insurance policy as collateral; guaranty; trust
disclosure statement, 17
representations and warranties, and consent; authorization and direction to provide death
certificate; limited specific power of attorney; authorization forms for use and disclosure of
health information; brokers rights of agent; limited power of attorney; hold harmless agreement;
insured disclosure statement, representations and warranties, and consent; representations,
warranties and covenants of agent; single case agreement; contact form, notifier letter,
assignment of beneficial interest; fee agreement and the form of trust or model trust provisions,
in each case in the form provided to the Insurer on the Effective Date.

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

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

 

 

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

	13.	 	Assignment. This Letter Agreement may not be assigned by any party without the prior
written consent of each other party hereto, which consent shall not be unreasonably withheld,
conditioned or delayed; provided, that the Insurer may assign this Letter Agreement, without the
need to obtain the prior written consent of the Company or the Contingent LPIC Insurer, to any
entity to whom the Insurer assigns the Policy and the 18
Contingent Insurer may assign this Letter Agreement, without the need to obtain the prior
written consent of the Company or the Insurer, to any entity to whom the Contingent
Insurer assigns the Contingent Policy.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

 

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

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

	 	 	 	 	 
	 	Sincerely,

IMPERIAL HOLDINGS LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

	 	 	 	 	 
	AGREED TO AND ACCEPTED BY:

LEXINGTON INSURANCE COMPANY

 	 	 
	By:  	 	 	 
	 	Name:  	 	 	 
	 	Title:  	 	 	 
	 
	NATIONAL FIRE & MARINE

INSURANCE COMPANY

 	 	 
	By:  	 	 	 
	 	Name:  	 	 	 
	 	Title:  	 	 	 
	 

Signature Page to Letter Agreement

 

 

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

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

	 	 	 	 	 
	 	Sincerely,

IMPERIAL HOLDINGS LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

	 	 	 	 	 
	AGREED TO AND ACCEPTED BY:

LEXINGTON INSURANCE COMPANY

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

 	 	 
	By:  	 	 	 
	 	Name:  	 	 	 
	 	Title:  	 	 	 
	 

Signature Page to Letter Agreement

 

 

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

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

	 	 	 	 	 
	 	Sincerely,

IMPERIAL HOLDINGS LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

	 	 	 	 	 
	AGREED TO AND ACCEPTED BY:

LEXINGTON INSURANCE COMPANY

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

 	 	 
	By:  	 	 	 
	 	Name:  	 	 	 
	 	Title:  	 	 	 

 

 

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

	 	 	 	 	 

EXHIBIT A

COPY OF POLICY

[SEE ATTACHED]

 

 

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

STRICTLY CONFIDENTIAL AND PROPRIETARY

Execution Copy

LEXINGTON INSURANCE COMPANY

(A Member Company of American International Group, Inc.)

100 Summer Street

Boston, Massachusetts 02110

THIS CONTRACT IS REGISTERED AND DELIVERED AS A SURPLUS LINE COVERAGE

UNDER THE SURPLUS LINE INSURANCE LAW O.C.G.A. CHAPTER 33-5.

LENDER PROTECTION INSURANCE POLICY

POLICY NUMBER: 7113486

DECLARATIONS

	 	 	 

	Item 1. Insured’s Name:

	 	Imperial Life Financing II, LLC
	 
	 	 
	Insured’s Address:

	 	191 Peachtree Street NE

Suite 3300

Atlanta, Georgia 30303

Attention: David Manchester
	 
	 	 
	Item 2. Effective Date:

	 	March 13, 2009
	 
	 	 
	Item 3. Term:

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

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

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

	 	Terrorism Coverage Premium: zero (0).

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

	 	 	 

	Item 6. Surplus Lines Broker:

	 	William Lee Mershon
	Mailing Address:

	 	Hays Companies

80 S. 8th Street, Suite 700

Minneapolis, MN 55402
	 
	 	 
	License No.:

	 	Georgia License No. 665715

© American International Group, Inc. All rights reserved.

i

 

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

	 	 	 

	Item 7. Attachments:

	 	Exhibit A — Form of Coverage Certificate

Exhibit B — Form of Proof of Loss

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

	 	 	 	 	 
	 	LEXINGTON INSURANCE COMPANY

 	 
	 	By:  	 	 
	 	 	Authorized Representative 	 
	 	 	Signed on March 13, 2009 	 
	 

© American International Group, Inc. All rights reserved.

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

POLICYHOLDER NOTICE

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

© American International Group, Inc. All rights reserved.

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

POLICYHOLDER DISCLOSURE

NOTICE OF TERRORISM INSURANCE COVERAGE

(APPLICABLE TO CERTIFIED AND NON-CERTIFIED ACTS)

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

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

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

     Acceptance or Rejection of Terrorism Insurance Coverage

	 	 	 

	Senior

	 	I hereby elect to purchase terrorism coverage for a prospective premium of $     0 .
	 
	 	 
	 

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

	 	 	 

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

	 	March 13, 2009
	 

	 	 
	Policyholder/Applicant’s Printed Name

	 	Date

© American International Group, Inc. All rights reserved.

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OF THE SECURITIES ACT OF 1933, AS AMENDED.

LEXINGTON INSURANCE COMPANY

(A Member Company of American International Group, Inc.)

100 Summer Street

Boston, Massachusetts 02110

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

LENDER PROTECTION INSURANCE POLICY

POLICY NUMBER: 7113486

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

Section I. Insuring Agreement and Loss Calculation

Subject to the terms and conditions of this Policy:

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

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

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

Notwithstanding anything to the contrary, payment of loss under this Policy shall only be made

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OF THE SECURITIES ACT OF 1933, AS AMENDED.

in full compliance with all United States of America economic or trade sanction laws or
regulations, including without limitation sanctions, laws and regulations administered and
enforced by the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”).

Section II. Limit of Liability

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

Section III. LPIC Premium

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

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

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

(i) The Insured has purchased (a) participations in the related Retail Loan pursuant
to the Master Participation Agreement or (b) the related Retail Loan pursuant to the
Insurance Premium Loan Sale and Assignment Agreement, such that such participations or
such Retail Loan qualifies as a Covered Loan; and

(ii) The Insurer shall have issued the applicable Coverage Certificate and received
the applicable LPIC Premium in accordance with Section III — LPIC Premium.

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

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

	A.	 	For each applicable Covered Policy, an amount of premium shall have been paid to the
applicable Life Insurance Carrier so that such Covered Policy has remained continuously in
force through the sixtieth (60th) day after the related Maturity Date. Notwithstanding the
foregoing, this condition precedent shall be deemed to be satisfied with respect to a
Covered Policy if the aggregate amount of premium paid to the applicable Life Insurance
Carrier prior to the lapse of such Covered Policy equaled or exceeded the Total Life
Insurance Premium set forth in the related Coverage Certificate.
	 
	B.	 	For any Covered Policy for which a Bankruptcy-Related Failure to Sell has occurred, the
Insured or the LPIC Servicer or any other Person (other than the Insurer) shall have paid
or caused to be paid all premiums necessary to keep such Covered Policy in force for the
period extending from the [*] ([*]th) day after the Maturity Date up to and
including the [*] ([*]th) day after the Maturity Date; provided, that the
Insurer may, in its sole discretion, waive this condition precedent, by express notice of
waiver in writing to the Insured, following the Insurer’s evaluation of the relevant
Covered Policy for which a Bankruptcy-Related Failure to Sell has occurred.
	 
	C.	 	The Insured or the LPIC Servicer shall have submitted to the Insurer, on or before the
[*] ([*]th) day after the related Loss Notification Date (the “Proof of
Loss Due Date”), a Proof of Loss relating to such Covered Loan; provided that:

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

For the avoidance of doubt, if the Insured or the LPIC Servicer submits a Proof of Loss
to the Insurer after the Proof of Loss Due Date but prior to the date by which a Proof of
Loss must be submitted to the Insurer to avoid the related loss being excluded from
coverage under this Policy in accordance with Section V.D, then the related
Outstanding

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

Loan Balance shall be payable under this Policy but shall reflect the adjustment to
the calculation of the Aggregate Interest Amount referenced in (2) and (3) above, as
applicable.

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

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

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

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

	E.	 	In the event of any foreclosure on, or other transfer of, a Covered Policy or the related
Beneficial Interest in satisfaction of a Covered Loan (provided that nothing prohibits
the Insured, or any other party to whom the Beneficial Interest is transferred, from
having such Covered Policy removed from the related Trust and transferred to the Insured
or such other party), then (i) the Insured shall have instructed the Remarketing Agent to
sell or otherwise dispose of such Covered Policy or such Beneficial Interest, (ii) the
Insured, upon request of the Remarketing Agent, shall have delivered to the Remarketing
Agent or the purchaser of such Covered Policy or such Beneficial Interest all
documentation relating thereto and (iii) the Insured shall not have instructed, caused or
permitted any

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

Person other than the Remarketing Agent to sell or otherwise dispose of such Covered
Policy or such Beneficial Interest.

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

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

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

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

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

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

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

Section V. Exclusions

	A.	 	This Policy does not apply to, and the Insurer shall not be liable hereunder for, any loss

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OF THE SECURITIES ACT OF 1933, AS AMENDED.

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

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

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

Authorized Officers had actual knowledge of the Contest before the Coverage
Certificate Effective Date.

Section VI. Termination and Prohibited Acts

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

	 	(1)	 	in connection with the issuance of a Covered Policy by a Life Insurance
Carrier and/or for the purpose of encouraging the issuance of or application for
such Covered Policy or a loan supported directly or indirectly by such Covered
Policy, providing any upfront inducement or gift valued in excess of $150 or
otherwise in violation of applicable law for the benefit of the Retail Borrower,
any beneficiary of the Retail Borrower and/or the Underlying Life and/or the spouse
or significant other of the Underlying Life; provided that the conduct
described in following provisions (a) and (b) shall not constitute an upfront
inducement or gift for purposes of this clause (1) so long as such conduct does not
violate applicable law and does not result in the Retail Borrower being entitled to
amounts (other than any benefit payable by the Life Insurance Carrier in connection
with a related Covered Policy) exceeding any such premium finance loan and the
reimbursed expenses described in provision (b) of this paragraph: (a) any
reasonable business marketing activity, event or meal conducted by any employee or
Authorized Officer of the Retail Lender or any Affiliate thereof or a Responsible
Party for the benefit of the Retail Borrower, any beneficiary of the Retail
Borrower, and/or the Underlying Life and/or the spouse or significant other of the
Underlying Life, and paid for by the Retail Lender or any Affiliate thereof or a
Responsible Party without any condition that the recipient or beneficiary thereof
purchase or finance any insurance and (b) any reimbursement of expenses incurred by
the Retail Borrower and/or the Underlying Life that relate directly to the issuance
of a Covered Loan;
	 
	 	(2)	 	in connection with the issuance of a Covered Policy by a Life Insurance
Carrier or the issuance or maintenance of a loan supported directly or indirectly
by a Covered Policy, causing any portion of the death benefit from such Covered
Policy to be paid to parties other than (a) those with an insurable interest in the
Underlying Life, (b) beneficiaries chosen by the Underlying Life or (c) the Retail
Lender in satisfaction of the related Covered Loan; provided that, the
amount collected by the Retail Lender may not exceed the outstanding loan
principal, together with related interest and reasonable and customary charges or
fees; and provided further that if (i) the aggregate amount of charges and fees
with

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

regard to such Covered Loan, other than LPIC Premium, does not exceed ten
percent (10%) of the Covered Loan Amount or (ii) no LPIC Premium is charged
directly to the Retail Borrower and identified as such under a Covered Loan, the
aggregate amount of charges and fees with regard to such Covered Loan does not
exceed the sum of ten percent (10%) of the Covered Loan Amount plus the amount of
LPIC Premium paid in connection with such Covered Loan, then such charges and
fees shall be considered reasonable and customary for purposes of this clause
(2);

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

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

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

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

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

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

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

	 	(1)	 	need not accept future Applications for Lender Protection Insurance
Coverage that relate to such Person or that relate to or involve, directly or
indirectly, such Person’s activities, and
	 
	 	(2)	 	may in its sole discretion cancel all outstanding Applications for Lender
Protection Insurance Coverage (including, for the avoidance of doubt, those
Applications for Lender Protection Insurance Coverage for which a Pre-Certificate
Review Decision Notice has been received by the Insured) that relate to such
Person.

	F.	 	The Insurer’s exercise of its rights under all or any portion of this Section VI shall
not
preclude the Insurer from exercising any other rights that it may have under any other

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

section of this Policy or under any other portion of this Section VI.

Section VII. Representations, Warranties, Covenants and Acknowledgements

	A.	 	The Insured represents, warrants and covenants to the Insurer that the Insured (i) has
conducted, and will conduct at all times prior to the termination of all coverage provided
by the Insurer under this Policy, its business relating to the transactions contemplated
by this Policy, the Master Participation Agreement and each Insurance Premium Loan and
Sale Assignment Agreement in all material respects in accordance with all state and
federal laws, statutes, rules and regulations applicable to it and (ii) has obtained all
requisite consents, approvals, authorizations and orders, and made all requisite filings
and registrations and obtained all requisite licenses, qualifications and permits of or
with any court, governmental or regulatory authority, agency or other body that is
necessary for the Insured to conduct of its business relating to the transactions
contemplated by this Policy, the Master Participation Agreement and each Insurance Premium
Loan and Sale Assignment Agreement.
	 
	B.	 	The Insured represents and warrants to the Insurer that the Insured has a place of
business in the State of Georgia at the address set forth in Item 1 of the Declarations
where the Insured administers matters relating to this Policy. The Insured covenants that
the Insured (i) will notify the Insurer promptly in writing of any change to such business
address and (ii) will not discontinue operating such business from such State without
first obtaining written consent from the Insurer.
	 
	C.	 	The Insured represents and warrants to the Insurer that, to the knowledge of the
Insured, the principal place of business of the Collateral Agent for purposes of
administering the transactions contemplated by this Policy is within the state of Oregon.
	 
	D.	 	The Insured represents and warrants to the Insurer that the Insured has obtained a
representation, warranty and covenant from each Retail Lender that all Covered Loans shall
be originated in accordance with the applicable criteria set forth in the Wholesale Loan
Agreement.
	 
	E.	 	The Insured represents and warrants to the Insurer that (i) neither the Insured nor any
Person that holds a direct or indirect voting equity interest in the Insured and (ii) to
the knowledge of the Insured, no Responsible Party or any other Person that provides
direct or indirect financial support to or for the benefit of the Insured in respect of
any Covered Loan or any Coverage Certificate and/or any Affiliate, Authorized Officer or
employee of any of the foregoing, is (x) a person or entity listed in the Annex to
Executive Order No. 13224 (2001) issued by the President of the United States (Executive
Order Blocking Property and Prohibiting Transactions with Persons Who Commit, Threaten to
Commit, or Support Terrorism) or (y) named on the List of Specially Designated Nationals
and Blocked Persons maintained by the U.S. Office of Foreign Assets Control.
	 
	F.	 	The Insured shall, upon the Insurer’s request and at the Insured’s expense, provide the
Insurer with identifying information regarding the Insured in connection with the
requirements of the Uniting and Strengthening America by Providing Appropriate Tools
Required to Intercept and Obstruct Terrorism Act of 2001, Pub. L., 107-56, 115 Stat. 380
(October 26, 2001), as amended.

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

	G.	 	The Insured represents, warrants and covenants to the Insurer that (i) the Insurer’s
identity has not been and shall not be disclosed by the Insured, any Affiliate thereof
or, to the knowledge of the Insured, any Responsible Party in any offering materials or
discussions with rating agencies or any life insurance carrier without the prior written
consent of the Insurer (which consent the Insurer can withhold in its sole and absolute
discretion), (ii) this Policy has not been and shall not be referenced by the Insured or
any Affiliate thereof or, to the knowledge of the Insured, any Responsible Party in any
offering materials or discussions with rating agencies in connection with any rated or
unrated securities offering without the prior written consent of the Insurer (which
consent the Insurer can withhold in its sole and absolute discretion) and (iii) it shall
provide written notice to the Insurer promptly (but in no event later than thirty (30)
days) following the Insured or any Affiliate thereof or any Responsible Party obtaining
actual knowledge that any Prohibited Act has been committed.

	H.	 	The Insured acknowledges that:

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

	I.	 	The Insured covenants to the Insurer that it will provide notice to the Insurer within three
(3) Business Days of obtaining knowledge that any Covered Policy is not current with
respect to the premiums required to keep the Covered Policy in force and also will
provide copies of any notices the Insured receives in that regard.
	 
	J.	 	The Insured covenants to the Insurer that if the Insured or any Affiliate thereof or a
Responsible Party obtains actual knowledge that any Covered Loan failed at any time to
comply in any material respect with any applicable laws, statutes, rules or regulations,
the Insured shall direct the Retail Lender to take all commercially reasonable action to
remedy such non-compliance.

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

Section VIII. Definitions

	A.	 	“Additional Collateral” means collateral other than a Covered Policy accepted by the
Retail Lender or the Insured as security for a related Covered Loan for all amounts in
excess of the Covered Loan Amount.

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

	B.	 	“Affiliate” of any Person means any other Person that (i) directly or
indirectly controls, is controlled by or is under common control with such Person or (ii)
is an officer or director of such Person. A Person shall be deemed to be “controlled by”
any other Person if such other Person possesses, directly or indirectly, power: (i) to
vote 10% or more of the securities (on a fully diluted basis) having ordinary voting power
for the election of directors or managing partners; or (ii) to direct or cause the
direction of the management and policies of such Person whether by contract or otherwise.
	 
	C.	 	“Aggregate Interest Amount” means, for each Covered Loan, interest on the
Covered Loan Amount (as adjusted downward, on a dollar for dollar basis, if the amount of
covered life insurance premium actually borrowed under such Covered Loan as of such
calculation date is less than the Covered Life Insurance Premium), accrued from and
including the Coverage Certificate Effective Date to but excluding the Payment Date
(adjusted, if necessary, in accordance with Section IV.C), at the per annum Loan
Rate, which interest shall be calculated based upon the actual number of days elapsed over
a 360-day year and on a compound interest basis.
	 
	D.	 	“Application For Lender Protection Insurance Coverage” means a document
substantially in the form set forth in Exhibit C attached hereto, properly
completed and duly executed by the Insured.
	 
	E.	 	“Authorized Officer” means any director, chief executive officer, president,
chief operating officer, chief financial officer, treasurer, general counsel, lead
compliance officer, vice president, or manager of the relevant Person.
	 
	F.	 	“Bankruptcy-Related Failure to Sell” means, for each Covered Policy, that such
Covered Policy could not be sold prior to the [*] ([*]th) day after the
Maturity Date as a result of (i) an Event of Bankruptcy with respect to any of the
Underlying Life, the Retail Borrower or any beneficiary of the Retail Borrower or (ii) the
automatic stay relating to such Event of Bankruptcy.
	 
	G.	 	“Beneficial Interest” means the entire beneficial interest in a Trust that holds a
Covered
Policy.
	 
	H.	 	“Business Day” means any day other than a Saturday, a Sunday or a day on which
commercial banks in New York, New York and Atlanta, Georgia are authorized or required to
be closed for business.
	 
	I.	 	“Collateral Agent” means, for each Covered Loan, the company that serves as
collateral agent for the Lender under the assignment of life insurance policy as
collateral relating to such Covered Loan, which company shall initially be Portfolio
Financial Servicing Company, having its principal place of business at 2121 S.W.
Broadway, Portland, Oregon 97201, and shall not be replaced without the prior written
consent of the Insurer.
	 
	J.	 	“Confidential Information” has the meaning set forth in Section X.A.
	 
	K.	 	“Contestability Determination Documents” means, with respect to each Covered
Policy that is Contested, any and all documentation presented to or received by the
related Trust, the Retail Borrower or the Retail Lender or an agent of any such party from
each Life Insurance Carrier that has issued such Covered Policy in connection with such
Life Insurance Carrier’s Contest of that Covered Policy, including without limitation a
death

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

certificate (if applicable), the document(s) by which such Life Insurance Carrier
informed the related Trust, the Retail Borrower or the Retail Lender of its decision
regarding such Covered Policy and any other documentation that relates to, summarizes or
supports the Life Insurance Carrier’s decision regarding that Covered Policy, which
documentation is required to be attached to the applicable Proof of Loss.

	L.	 	“Contest” or “Contested” or means, for each Covered Policy, that the
Life Insurance Carrier has rescinded or contested such Covered Policy (including without
limitation on the basis of a lack of insurable interest) pursuant to a written notice from
the Life Insurance Carrier.
	 
	M.	 	“Contingent LPIC Insurer” means the “Insurer” as defined in the Contingent LPIC
Policy.
	 
	N.	 	“Contingent LPIC Policy” means that certain Contingent Lender Protection
Insurance Policy, Policy No. 92 SRD 102507, issued to the Insured by the Contingent LPIC
Insurer, effective as of March 13, 2009.
	 
	O.	 	“Contingent LPIC Premium” means, for each Covered Loan, the amount set forth as
such in the applicable Coverage Certificate.
	 
	P.	 	“Coverage Certificate” means, for each Covered Loan, a certificate
substantially in the form set forth in Exhibit A attached hereto, issued and duly executed
by the Insurer and pursuant to which coverage under this Policy for such Covered Loan is
provided.
	 
	Q.	 	“Coverage Certificate Effective Date” means, for each Covered Loan, the date
set forth as such in the applicable Coverage Certificate.
	 
	R.	 	“Covered Expenses” means, for each Covered Loan, the amount set forth as such
in the applicable Coverage Certificate.
	 
	S.	 	“Covered Life Insurance Premium” means, for any Covered Policy, the amount set
forth as such on the applicable Coverage Certificate.
	 
	T.	 	“Covered Loan” means a loan made by the Retail Lender to a Retail Borrower (i)
in which the Insured has purchased undivided participations pursuant to the Master
Participation Agreement or (ii) that has been purchased by the Insured pursuant to an
Insurance Premium Loan Sale and Assignment Agreement and with respect to which, (x) the
amount of such participations or the portion of the Retail Loan so purchased shall be
equal to the Covered Loan Amount set forth in the applicable Coverage Certificate and (y)
the Insurer shall have issued a Coverage Certificate hereunder.
	 
	U.	 	“Covered Loan Amount” means, for each Covered Loan, the amount set forth as
such in the applicable Coverage Certificate.
	 
	V.	 	“Covered Loan Settlement-Related Amount” means, for each Covered Loan, an
amount equal to the sum of the Settlement Amounts for all Covered Policies related to such
Covered Loan plus the sum of all other amounts paid to the Retail Lender to decrease the
outstanding balance of the related Covered Loan and which the Retail Lender has not been
required to return or repay under any applicable law (including bankruptcy or insolvency
laws), but excluding amounts paid to the Retail Lender to decrease the outstanding balance
of such Covered Loan in an aggregate amount up to but not

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

exceeding the portion of such Covered Loan secured by Additional Collateral. For
purposes of clarification with respect to a Covered Loan, the surrender, transfer or
assignment of ownership of a related Covered Policy by a Retail Borrower to a related
Retail Lender for purposes of satisfying a Covered Loan shall not be considered to be an
amount paid to such Retail Lender to decrease the outstanding balance of the related
Covered Loan, even if such Retail Lender releases the Retail Borrower or the Underlying
Life from liability under the Retail Loan Documents in connection with such surrender or
assignment.

	W.	 	“Covered Policy” means, for each Covered Loan, each life insurance policy that
is identified in the applicable Coverage Certificate by its policy number, which life
insurance policy shall be issued by a Life Insurance Carrier to the applicable Retail
Borrower as owner thereof.
	 
	X.	 	“Credit Event” means the Insurer (a) is unable to pay its insurance obligations
under any insurance policy in full or admits in writing its inability generally to pay its
insurance obligations under insurance policies in full as they become due, (b) enters into
liquidation, (c) seeks or becomes subject to an insolvency proceeding in the United States
or a rehabilitator or other similar official is appointed for all or substantially all its
assets or (d) becomes subject to a corrective order or similar document issued by an
insurance regulator that cites or otherwise references its financial impairment or failure
to meet minimum levels of statutory capital or surplus and which prohibits payments of
claims as and when due.
	 
	Y.	 	“Death Benefit” means, for any Covered Policy, the amount set forth as such on
the applicable Coverage Certificate.
	 
	Z.	 	“Declarations” means the declaration pages attached to the front of this Policy.
	 
	AA.	 	“Effective Date” has the meaning set forth in Item 2 of the Declarations.
	 
	BB.	 	“Event of Bankruptcy” shall be deemed to have occurred with respect to a Person if
either:

	 	(a)	 	a case, action or other proceeding shall be commenced, without the
application or consent of such Person, in any court, seeking the liquidation,
reorganization, debt arrangement, dissolution, winding up, or composition or
readjustment of debts of such Person, the appointment of a trustee, receiver,
custodian, liquidator, assignee, sequestrator or the like for such Person or all or
substantially all of its assets, or any similar action with respect to such Person
under any law relating to bankruptcy, insolvency, reorganization, winding up or
composition or adjustment of debts; or an order for relief in respect of such
Person shall be entered in an involuntary case under the federal bankruptcy laws or
other similar laws now or hereafter in effect; or
	 
	 	(b)	 	such Person shall commence a voluntary case or other proceeding under any
applicable bankruptcy, insolvency, reorganization, debt arrangement, dissolution or
other similar law now or hereafter in effect, or shall consent to the appointment
of or taking possession by a receiver, liquidator, assignee, trustee, custodian,
sequestrator (or other similar official) for such Person or for any substantial
part

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

of its property, or shall make any general assignment for the benefit of
creditors, or shall fail to, or admit in writing its inability to, pay its debts
generally as they become due, or, if a corporation or similar entity, its board
of directors shall vote to implement any of the foregoing.

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

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

	DD.	 	“Foreclosed Policy” means, for each Covered Loan, each Covered Policy or the
related Beneficial Interest, the sale or other disposition of which is being effected
through the foreclosure process as a result of the Retail Borrower’s default under such
Covered Loan.
	 
	EE.	 	“Free Look Period” means the period during which a Retail Borrower or its assignee

may, pursuant to the terms of a Covered Policy or applicable law, cancel such Covered
Policy and receive a refund of all premiums previously paid thereunder.
	 
	FF.	 	“Insurance Premium Loan Sale and Assignment Agreement” means an Insurance
Premium Loan Sale and Assignment Agreement between the Retail Lender and the Insured, in
each case in the form provided to the Insurer on the Effective Date and as the same may
be amended, supplemented or otherwise modified from time to time in accordance with the
terms thereof.

	GG.	 	“Insured” has the meaning set forth in the preamble of this Policy.
	 
	HH.	 	“Insured’s Account” means a bank account of the Insured located in the State of Georgia
with the following account information:

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[* ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
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OF THE SECURITIES ACT OF 1933, AS AMENDED.

Bank:

ABA:

Account Number:

Account Name:

Type of Account:

	II.	 	“Insurer” has the meaning set forth in the preamble of this Policy.
	 
	JJ.	 	“Life Insurance Carrier” means, for each Covered Policy, the issuer of such Covered
Policy identified as such in the applicable Coverage Certificate.
	 
	KK.	 	“Limit of Liability” means, for each Covered Loan, the amount set forth as such in the
applicable Coverage Certificate.
	 
	LL.	 	“Loan Rate” means, for each Covered Loan, the rate set forth as such in the applicable
Coverage Certificate.
	 
	MM.	 	“Loss Notification Date” means, for any Covered Loan, the date on which the
Insured receives a notice of a loss under this Policy relating to such Covered Loan, which
date shall be:

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

	NN.	 	“LPIC Premium” means, for each Covered Loan, the amount set forth as such in
the applicable Coverage Certificate.
	 
	OO.	 	“LPIC Servicer” means the company appointed by the Insured to perform any
duties on behalf of the Insured under the Policy, and solely in such capacity, which
company shall (i) initially be Imperial Life & Annuity Services, LLC and (ii) be subject to
replacement by the Insured from time to time in its sole discretion upon delivery of a
notice to the Insurer identifying the replacement LPIC Servicer.

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

	PP.	 	“Master Participation Agreement” means the Master Participation Agreement dated
as of
the Effective Date between the Retail Lender and the Insured, in the form provided to the
Insurer on the Effective Date and as the same may be amended, supplemented or otherwise
modified from time to time in accordance with the terms thereof.
	 
	QQ.	 	“Maturity Date” means, for each Covered Loan, the date set forth as such in
the applicable Coverage Certificate.
	 
	RR.	 	“Outstanding Loan Balance” has the meaning set forth in Section I.
	 
	SS.	 	“Payment Date” means, for each Covered Loan, the date on which the Insurer pays the
Insured the related Outstanding Loan Balance, if any.
	 
	TT.	 	“Person” means any individual, corporation, partnership, joint venture, association, joint-
stock company, limited liability company, trust, unincorporated association, joint
venture, government or any agency or political subdivision thereof or any other entity.
	 
	UU.	 	“Pledge and Security Agreement” means the Pledge and Security Agreement dated
as of the Effective Date made by the Insured in favor of CTL Holdings II, LLC as collateral
agent for the agents and the lenders under the Wholesale Loan Agreement, in the form
provided to the Insurer on the Effective Date and as the same may be amended, supplemented
or otherwise modified from time to time in accordance with the terms thereof.
	 
	VV.	 	“Policy” has the meaning set forth in the preamble hereof.
	 
	WW.	 	“Pre-Certificate Review Decision Notice” means notification from the Insurer to
the Insured pursuant to the Services and Remarketing Agreement stating that either (i) the
Insurer is committed, subject to the terms of this Policy, to deliver upon the request of
the Insured a certificate evidencing coverage for such under the Policy consistent with the
terms specified in such Pre-Certificate Review Decision Notice, or (ii) the Insurer is
declining to provide coverage under the Policy and the rationale for such decline.
	 
	XX.	 	“Prohibited Act” has the meaning set forth in Section VI.B.
	 
	YY.	 	“Proof of Loss” means a certificate in the form set forth in Exhibit B attached hereto,
properly completed and duly executed by the Insured, with all required exhibits thereto
(including an exhibit, in the form set forth in Exhibit 1 to the Proof of Loss
attached hereto, reflecting the Insured’s non-binding calculation of the Outstanding Loan
Balance and, if applicable, all notices received by the Insured or any agent, servant or
employee of the Insured in connection with the lapse of any Covered Policy and/or any
Contestability Determination Documents).
	 
	ZZ.	 	“Proof of Loss Due Date” has the meaning set forth in Section IV.C.
	 
	AAA.	 	“Remarketing Agent” means the company that will act as the exclusive remarketing
agent for purposes of selling or otherwise disposing of a Covered Policy, which company
shall (i) initially be Imperial Life & Annuity Services, LLC (ii) at all times be obligated
to take instructions from and act on behalf of the Insurer with regard to the sale or other
disposition of such Covered Policy and (iii) be subject to replacement by the Insurer from
time to time in its sole discretion; provided that, any such replacement shall only be

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

	 	 	effective for purposes of this Policy upon delivery by the Insurer to the
Insured of a written notice identifying the replacement Remarketing Agent.
	 
	BBB.	 	“Responsible Party” means, any Person that provides direct or indirect financial
support to or for the benefit of the Insured in respect of any Covered Loan through the
Wholesale Loan Agreement and/or any Affiliate, Authorized Officer or employee of any such
Person; provided that, none of the Insured or its Authorized Officers or any Affiliate of
the Insured or any such Authorized Officers shall be considered a Responsible Party.
	 
	CCC.	 	“Retail Borrower” means, for each Covered Loan, the Person obligated to make
principal and interest payments to the applicable Retail Lender in connection with such
Covered Loan.
	 
	DDD.	 	“Retail Lender” means, for each Covered Loan, the company that makes such Covered
Loan to the Retail Borrower, which company shall be Imperial Premium Finance, LLC or any
other wholly-owned subsidiary of Imperial Holdings, LLC identified by the Insured to the
Insurer in writing at least ten (10) Business Days prior to such entity making its first
Covered Loan to a Retail Borrower; provided that, any such company shall have entered the
Master Participation Agreement and the appropriate Insurance Premium Loan Sale and
Assignment Agreement.
	 
	EEE.	 	“Retail Loan Documents” means, for each Covered Loan, the relevant documents
entered into in connection with the issuance of such Covered Loan, including without
limitation the relevant loan application and agreement; promissory note; escrow agreement;
beneficiary pledge agreement; assignment of life insurance policy as collateral; guaranty;
trust disclosure statement, representations and warranties, and consent; authorization and
direction to provide death certificate; limited specific power of attorney; authorization
forms for use and disclosure of health information; brokers rights of agent; limited power
of attorney; hold harmless agreement; insured disclosure statement, representations and
warranties, and consent; representations, warranties and covenants of agent; single case
agreement; contact form, notifier letter, assignment of beneficial interest; fee agreement
and the form of trust or model trust provisions, in each case in the form provided to the
Insurer on the Effective Date.
	 
	FFF.	 	“Services and Remarketing Agreement” means the LPIC Services and Remarketing
Agreement, entered into as of March 13, 2009 by and among Imperial Life & Annuity Services,
LLC, the Insurer and the Contingent Insurer, as may be amended and restated, or otherwise
modified from time to time.
	 
	GGG.	 	“Settlement Amount” means, for each Covered Policy:

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

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

	 	 	 	the permission of the Insurer, the amount payable by such Life Insurance
Carrier pursuant to the terms of such Covered Policy (without reduction due to an
Event of Bankruptcy with respect to the Life Insurance Carrier or any other
reason); or
	 
	 	(iii)	 	if such Covered Policy has been Contested, an amount equal to the sum of (a)
plus (b) all multiplied by (c), where:

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

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

	HHH.	 	“Surplus Lines Broker” has the meaning set forth in Item 6 of the
Declarations.
	 
	III.	 	“Term” has the meaning set forth in Item 3 of the Declarations.
	 
	JJJ.	 	“Total Life Insurance Premium” means, for any Covered Policy, the amount set
forth as such on the applicable Coverage Certificate.
	 
	KKK.	 	“Transaction Documents” means this Policy and any Coverage Certificates issued
under this Policy, as any of the foregoing may be amended, supplemented, amended and
restated, or otherwise modified from time to time.

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© American International Group, Inc. All rights reserved.

 

 

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

	LLL.	 	“Trust” means, for each Covered Loan, any trust that owns a Covered Policy.
	 
	MMM.	 	“Underlying Life” means, for each Covered Policy, the individual (or individuals)
specified as such (by unique identifying number or otherwise) in the applicable Coverage
Certificate and who is the measuring life (or are the measuring lives) under such Covered
Policy.
	 
	NNN.	 	“Unencumbered Covered Policy Date” has the meaning set forth in Section IV.D.
	 
	OOO.	 	“Wholesale Lender Party” means, any of the “Agents” or the “Lenders” under the
Wholesale Loan Agreement (as such terms are defined in the Wholesale Loan Agreement).
	 
	PPP.	 	“Wholesale Loan Agreement” means, the Financing Agreement dated as of March 13,
2009 between the Insured, as borrower, and CTL Holdings II LLC, as lender, together with
any Assignment and Acceptance delivered in connection therewith, as the same may be
amended, supplemented or otherwise modified in accordance with the terms thereof.

Section IX. Recovery and Subrogation

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

Section X. Confidentiality

	A.	 	Each party hereto agrees that “Confidential Information” means (i) each of the
Transaction Documents and its contents, (ii) all medical and personal information
concerning any Underlying Life and, if applicable, any Retail Borrower and (iii) all
confidential or non-public information and data in whatever form, whether written, oral,
electronic or otherwise furnished by either party in connection with this Policy in each
case to the extent, (a) not already in the receiving party’s possession, (b) not available
to the receiving party prior to its disclosure under this Policy, (c) not in the public
domain when transmitted by one party to another, (d) not published or otherwise becoming
part of the public domain (through no fault of the receiving party) prior to or after
transmission, (e) not known to the receiving party through disclosure by a third party
(and not to the knowledge of the recipient of such information bound by any duty to the
transmitting party to keep such information confidential), and (f) not independently
developed by the receiving party.
	 
	B.	 	Each party hereto shall safeguard and hold, and cause their respective officers,
directors employees, agents or representatives to safeguard and hold, as confidential all
Confidential Information, and shall use Confidential Information solely for the purposes
contemplated by the Transaction Documents unless and only to the extent (i) disclosed

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

	 	 	to such party’s (or any of its Affiliate’s) own officers, directors, employees,
agents or representatives (including attorneys and internal and outside auditors) that
have a need to know such information in connection with the underwriting or
administration of any coverage contemplated or provided under this Policy, (ii) disclosed
to the Contingent LPIC Insurer or any of its or its Affiliate’s own officers, directors,
employees, agents or representatives (including attorneys and internal and outside
auditors) that have a need to know such information in connection with the underwriting
or administration of any coverage contemplated or provided under the Contingent LPIC
Policy, (iii) disclosed to Wholesale Lender Parties or their respective officers,
directors, employees, agents or representatives (including attorneys and internal and
outside auditors) that have a need to know such information in connection with entering
into, and administering loans made pursuant to, the Wholesale Loan Agreement; provided
that, they shall have been informed of the confidential nature of the Confidential
Information and directed to treat it confidentially in accordance with the terms of this
Section X, (iv) compelled to disclose by judicial or administrative process or by
other requirements of law or regulation, (v) requested to disclose by any competent
executive, legislative, judicial, regulatory or administrative authorities with
regulatory authority over the disclosing party, or (vi) disclosed in any action or
proceeding brought by a party in pursuit of its rights or in the exercise of its remedies
under this Policy. Notwithstanding the foregoing, this Policy, the form hereof and any
other document delivered by the Insurer in connection with this Policy, shall constitute
Confidential Information of the Insurer, and the Insurer shall be entitled to use the
form of this Policy in its business with no restrictions imposed by the provisions of
this Section X.
	 
	C.	 	Notwithstanding anything to the contrary set forth in this Policy, each of the Insurer and
the Insured (and each employee, representative, or other agent of such party) may
disclose to any and all Persons, without limitation of any kind, the Tax Treatment and
Tax Structure of this Policy. For purposes of these provisions, “Tax Treatment” is
strictly limited to the purported or claimed United States federal income tax treatment
of this Policy and “Tax Structure” is strictly limited to any fact that may be relevant
to understanding the purported or claimed United States federal income tax treatment of
this Policy. These provisions are meant to be interpreted so as to prevent this Policy
from being treated as offered under “conditions of confidentiality” within the meaning of
the Internal Revenue Code and the Treasury Regulations thereunder.

Section XI. General Policy Provisions

	A.	 	Assignment: This Policy and any and all rights under this Policy may not be assigned by
either party without the prior written consent of the other party; provided,
however, that (i) while the Insurer will continue to deal solely with the Insured in
connection with all matters pertaining to this Policy, the Insured may pledge its rights
under this Policy as contemplated by the Wholesale Loan Agreement and the Pledge and
Security Agreement and (ii) the Insurer may assign this Policy and any and all rights
under this Policy to another member company of American International Group, Inc. without
the prior written consent of the Insured so long as such other member company, at the
time of transfer, has a financial strength rating from Standard & Poor’s Rating Services,
a division of the McGraw-Hill Companies, Inc. or Moody’s Investors Service, Inc. equal to
or better than that of the Insurer at the time of such assignment, and in the event of
any such assignment by the Insurer, the Insurer or the assignee shall, if practical,
endeavor to provide the Insured with prior or subsequent written notice of such
assignment. The

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© American International Group, Inc. All rights reserved.

 

 

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

	 	 	Insurer shall not be bound by any assignment or transfer of interest that takes
place without its prior written consent.
	 
	B.	 	Changes and Waivers: Notice to any representative of the Insurer or knowledge
possessed by any such representative or by any Person shall not effect a waiver or change
in any part of this Policy; nor shall the terms of this Policy be waived, changed,
modified or amended unless agreed to in writing by an authorized representative of the
Insurer. The failure of either party to enforce any provision of this Policy shall not
constitute a waiver by such party of any such provision. Any past waiver of a provision by
any party shall not constitute a course of conduct or a waiver in the future of that same
provision.
	 
	C.	 	Examination of Books And Records: The Insurer shall have the right, but not the
obligation, from time to time to examine or audit, at the Insurer’s expense, all of the
Insured’s books and records that pertain to the coverage provided by this Policy. The
Insurer shall notify the Insured of such an inspection at least five (5) Business Days in
advance. To the extent that such books and records are to be maintained by a third party
on behalf of the Insured, the Insured shall ensure that any related agreement with such
third party allows for the Insurer to examine such books and records and the Insured shall
direct such third party to allow the Insurer to examine such books and records in
accordance with this section.
	 
	D.	 	Assistance and Cooperation: The Insured shall comply with all reasonable
requests of the Insurer to assist the Insurer in verifying the validity of a loss and
securing any rights, remedies or recoveries arising out of a payment by the Insurer under
this Policy (including those relating to any Covered Policy or related Beneficial
Interest), including without limitation assisting the Insurer to obtain information
regarding any Covered Policy or the Underlying Life under any Covered Policy. In addition,
the Insured shall use commercially reasonable efforts to comply with all reasonable and
lawful requests that may be made by the Insurer in connection with keeping a Covered
Policy in force, including without limitation paying (or arranging for the payment of, or
allowing the Insurer if the Insurer so chooses to pay or arrange for the payment of)
additional premiums on such Covered Policy; it being understood that any such requests
that may be made by the Insurer, including without limitation, in connection with any
payment of additional premiums that may be required to keep a Covered Policy in force,
shall only be undertaken by or on behalf of the Insured at the expense of the Insurer.
	 
	E.	 	Third Parties: This Policy shall not be deemed to give any right or remedy
whatsoever to any third party unless said right or remedy is specifically granted to such
third party by the terms hereof.
	 
	F.	 	Entire Agreement: This Policy contains the full and complete understanding and
agreement between the parties hereto with respect to the subject matter hereof. The
parties acknowledge that neither is entering into this Policy in reliance upon any term,
condition, representation or warranty not stated herein and that this Policy replaces any
and all prior agreements whether oral or written, pertaining to the subject matter hereof.
	 
	G.	 	Construction: It is understood and agreed that this Policy is a manuscript
policy that has been negotiated at arm’s length and on equal footing as between the
Insured and Insurer, that both parties are sophisticated and that both parties fully
understand and

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

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

If to the Insurer:

Lexington Insurance Company

70 Pine Street, 5th Floor

New York, New York 10270

Facsimile: (212) 943-4054

Attention: Surveillance Department

If to the Insured:

Imperial Life Financing II, LLC

191 Peachtree Street NE, Suite 3300

Atlanta, Georgia 30303

Fax: (404) 736-3620

Attention: David Manchester

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

	 	(1)	 	It is hereby understood and agreed that all disputes or differences which may

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

	 	 	 	arise under or in connection with this Policy, including without limitation
any determination of the amount of damages and including without limitation any
disputes or differences arising and/or continuing after the termination,
cancellation or expiration of this Policy, shall be submitted to the American
Arbitration Association in New York, New York for confidential, binding
arbitration under and in accordance with its commercial arbitration rules then in
effect.
	 
	 	(2)	 	Unless the Insurer and the Insured mutually agree in writing that there
shall be one arbitrator (in which case, there shall be one arbitrator), there shall
be a total of three arbitrators in connection with any arbitration, where the
Insurer and the Insured shall each choose one arbitrator and such chosen
arbitrators shall choose a third arbitrator. In any event, each arbitrator shall be
disinterested, shall have knowledge of the legal, financial, corporate and
insurance issues relevant to the matters in dispute, and shall otherwise be chosen
in the manner provided in such commercial arbitration rules.
	 
	 	(3)	 	Any arbitration shall be subject to the Federal Arbitration Act and, to
the extent such Act is not applicable, the laws of the State of New York. The
arbitration dispute resolution mechanisms set forth in this section are intended to
be the sole and exclusive dispute resolution mechanisms for any dispute arising
between the Insurer and the Insured hereunder or relating hereto, including without
limitation any dispute relating to the validity or enforceability of this Policy or
of this Section XI.L and shall survive the termination of this Policy.
	 
	 	(4)	 	The decision of the arbitrator(s) shall be final and binding and provided
to both parties, and the arbitration award shall not include attorneys’ fees or
other costs.
	 
	 	(5)	 	Each party shall bear the expense of its own arbitration activities,
including its appointed arbitrator and its outside attorney or witness fees, and
the parties shall equally bear the expense of the third arbitrator and the common
expenses of the arbitration proceeding. The arbitration proceeding shall be held in
New York, New York.

	M.	 	Service of Suit: Subject to Section XI.L above, in the event of failure of the
Insurer to
pay any amount claimed to be due hereunder, the Insurer, at the request of the Insured,
will submit to the jurisdiction of a court of competent jurisdiction within the United
States. Nothing in this condition constitutes or should be understood to constitute a
waiver of the Insurer’s rights to commence an action in any court of competent
jurisdiction in the United States, to remove an action to a United States District Court
or to seek a transfer of a case to another court as permitted by the laws of the United
States or of any state in the United States. Service of process in such suit may be made
upon General Counsel, Lexington Insurance Company, 175 Water Street, New York, New York
10038 or his or her representatives, with a copy to Senior Division Counsel, AIG Risk
Finance, 70 Pine Street, 5th Floor, New York, New York 10270. In any suit instituted
against the Insurer upon this Policy, the Insurer shall abide by the final decision of
such court or of any appellate court in the event of any appeal.
	 
	 	 	Further, pursuant to any statute of any state, territory, or district of the United States
which makes provision therefor, the Insurer hereby designates the Superintendent,
Commissioner, or Director of Insurance, other officer specified for that purpose in the

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

	 	 	statute, or his or her successor or successors in office as its true and lawful
attorney upon whom may be served any lawful process in any action, suit, or proceeding
instituted by or on behalf of the Insured or any beneficiary hereunder arising out of
this Policy, and hereby designates the above named counsel as the individual to whom the
said officer is authorized to mail such process or a true copy thereof.
	 
	N.	 	Unwinding of Covered Policies: Notwithstanding any other provision in this
Policy, if, after the issuance of a Coverage Certificate, the applicable Retail Borrower
exercises its right to cancel a Covered Policy relating to the applicable Covered Loan
within the applicable Free Look Period, then (1) all coverage under this Policy relating
to such Coverage Certificate shall be void ab initio, (2) the Insurer shall return to the
Insured all previously received Premium relating to such Covered Loan and (3) each of the
Insurer and the Insured shall bear its own costs and expenses relating thereto, with no
rights to indemnification from the other party for such costs and expenses.
	 
	O.	 	Counterparts: This Policy may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute one and the
same document.
	 
	P.	 	Inadvertent Errors: If, after the issuance of a Coverage Certificate, the
Insurer or the Insured discovers that an inadvertent error has been made in such Coverage
Certificate, such party shall promptly notify the other party of such inadvertent error.
Following such notification, such inadvertent error may be corrected with the issuance of
a replacement Coverage Certificate, but only under one of the following circumstances: (i)
such inadvertent error was an inadvertent omission, incorrect reference, typographical
error or unintended inconsistency in any Application for Lender Protection Insurance
Coverage or any Coverage Certificate and the issuance of the revised Coverage Certificate
would not adversely affect the rights of the Insurer, the Insured or any Wholesale Lender
Party; (ii)(x) concurrently with the issuance of such revised Coverage Certificate, any
Covered Loan and any related loan made by a Wholesale Lender Party under the Wholesale
Loan Agreement is repaid to the extent necessary to restore the Insurer, the Insured and
any Wholesale Lender Party to the same position that each such Person would have occupied
had such inadvertent error not occurred and (y) the issuance of the revised Coverage
Certificate would not adversely affect the rights of the Insurer, the Insured or any
Wholesale Lender Party; or (iii) any other circumstance in which the issuance of such
revised Coverage Certificate would not adversely affect the rights of the Insurer, the
Insured or any Wholesale Lender Party.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

26

© American International Group, Inc. All rights reserved.

 

 

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

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

	 	 	 

	SECRETARY
	 	PRESIDENT

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

IN WITNESS WHEREOF, the Insured has caused this Policy to be signed by its duly authorized
representative:

	 	 	 	 	 
	 	IMPERIAL LIFE FINANCING II, LLC

 	 
	 	 	 
	 	Name:  	 	 	 
	 	Title:  	 	 	 
	 

© American International Group, Inc. All rights reserved.

27

 

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

EXHIBIT A 

FORM OF COVERAGE CERTIFICATE 

LEXINGTON INSURANCE COMPANY

(A Member Company of American International Group, Inc.)

100 Summer Street

Boston, Massachusetts 02110

THIS CONTRACT IS REGISTERED AND DELIVERED AS A SURPLUS LINE COVERAGE

UNDER THE SURPLUS LINE INSURANCE LAW O.C.G.A. CHAPTER 33-5.

COVERAGE CERTIFICATE FOR LENDER PROTECTION INSURANCE COVERAGE

POLICY NUMBER: 7113486

INSURED: IMPERIAL LIFE FINANCING II, LLC

	 	 	 	 	 

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

Information Relating to Covered Loan

	 	 	 	 	 

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

A-1

© American International Group, Inc. All rights reserved.

 

 

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

Information Relating to Covered Policies

Covered Policy #1

	 	 	 	 	 

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

Covered Policy #2 (if applicable)

	 	 	 	 	 

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

	 	 	 	 	 
	 	LEXINGTON INSURANCE COMPANY

 	 
	 	By:  	 	 
	 	 	Title: Authorized Representative 	 
	 	 	Signed on: _________________	 
	 

A-2

© American International Group, Inc. All rights reserved.

 

 

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

EXHIBIT B

FORM OF PROOF OF LOSS

IMPERIAL LIFE FINANCING II, LLC

191 Peachtree Street NE

Suite 3300

Atlanta, Georgia 30303

[INSERT DATE]

	To: 	 	Lexington Insurance Company

70 Pine Street, 5th Floor

New York, New York 10270

Facsimile: (212) 943-4054

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

     Reference is hereby made to (i) the Lender Protection Insurance Policy, Policy Number
7113486, with an effective date of March 13, 2009, issued by Lexington Insurance Company (the
“Insurer”); (ii) the Coverage Certificate, Certificate Number [•], dated as of
[DATE], issued by the Insurer; and (iii) each life insurance policy (each such policy, a
“Covered Policy”) with respect to such Coverage Certificate issued by [INSERT LIFE
INSURANCE CARRIER’S NAME] (each, a “Life Insurance Carrier”). For purposes of this
Proof of Loss, the Lender Protection Insurance Policy shall be known as the “Policy”.
Capitalized terms used in this Proof of Loss without definition shall have the meanings
specified in the Policy.

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

First Covered Policy

	 	 	 

	Policy Number:
	 	 
	 

	 	 
	Result:

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

	 	[Lapsed]
	 
	 	 
	 

	 	[Contested/Rescinded]
	 
	 	 
	 

	 	[Sold]
	 
	 	 
	 

	 	[Remains Unsold]
	 
	 	 
	 

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

	 	 
	 
	 	 
	 

	 	 

B-1

© American International Group, Inc. All rights reserved.

 

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

	 	 	 

	 

	 	 
	 
	 	 
	Date of Insured’s
Receipt of Settlement
Amount:
	 	 
	 

	 	 

Second Covered Policy (if applicable)

	 	 	 

	Policy Number:
	 	 
	 

	 	 
	Result:

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

	 	[Lapsed]
	 
	 	 
	 

	 	[Contested/Rescinded]
	 
	 	 
	 

	 	[Sold]
	 
	 	 
	 

	 	[Remains Unsold]
	 
	 	 
	 

	 	[Surrendered to the relevant Life Insurance Carrier]
	 
	 	 
	 

	 	 
	Settlement Amount:
	 	 
	 
	 	 
	 

	 	 
	 
	 	 
	Date of Insured’s Receipt
of Settlement Amount:
	 	 
	 

	 	 

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

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

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

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

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

B-2

© American International Group, Inc. All rights reserved.

 

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

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

B-3 

© American International Group, Inc. All rights reserved.

 

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

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

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

	 	 	 	 	 
	 	IMPERIAL LIFE FINANCING II, LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

B-4

© American International Group, Inc. All rights reserved.

 

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

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

Calculation of Outstanding Loan Balance

	 	 	 	 	 	 	 	 	 

	 	(1	)	 	Lesser of Covered Life Insurance Premium and the amount
of covered life insurance premium actually borrowed under
such Covered Loan as of such calculation date:
	 	 	 	 
	 	 	 	 	 
	 	 	 
	 	 	 	 	 
	 	 	 	 
	 	(2	)	 	LPIC Premium:
	 	 	 	 
	 	 	 	 	 
	 	 	 
	 	 	 	 	 
	 	 	 	 
	 	(3	)	 	Contingent LPIC Premium:
	 	 	 	 
	 	 	 	 	 
	 	 	 
	 	 	 	 	 
	 	 	 	 
	 	(4	)	 	Covered Expenses:
	 	 	 	 
	 	 	 	 	 
	 	 	 
	 	 	 	 	 
	 	 	 	 
	 	(5	)	 	Covered Loan Amount, which equals

(1) above plus (2) above plus (3) above plus (4) above:
	 	 	 	 
	 	 	 	 	 
	 	 	 
	 	 	 	 	 
	 	 	 	 
	 	(6	)	 	Coverage Certificate Effective Date:
	 	 	 	 
	 	 	 	 	 
	 	 	 
	 	 	 	 	 
	 	 	 	 
	 	(7	)	 	Maturity Date:
	 	 	 	 
	 	 	 	 	 
	 	 	 
	 	 	 	 	 
	 	 	 	 
	 	(8	)	 	Insured’s estimate of Payment Date:
	 	 	 	 
	 	 	 	 	 
	 	 	 
	 	 	 	 	 
	 	 	 	 
	 	(9	)	 	Aggregate Interest Amount

(for the period commencing on the Coverage Certificate Effective Date
and ending on the date specified in Section IV.C, calculated using the
Loan Rate set forth in the applicable Coverage Certificate):
	 	 	 	 
	 	 	 	 	 
	 	 	 
	 	 	 	 	 
	 	 	 	 
	 	(10	)	 	Sum of all Settlement Amounts:
	 	 	 	 
	 	 	 	 	 
	 	 	 
	 	 	 	 	 
	 	 	 	 
	 	(11	)	 	Sum of all other amounts paid to the Retail Lender to decrease the
outstanding balance of the related Covered Loan Amount and which the
Retail Lender has not been required to return or repay under any
applicable law (including bankruptcy or insolvency laws), but
excluding amounts paid to the Retail Lender to decrease the
outstanding loan balance of such Covered Loan in an aggregate amount
up to but not exceeding the portion of such Covered Loan secured by
Additional Collateral:
	 	 	 	 
	 	 	 	 	 
	 	 	 
	 	 	 	 	 
	 	 	 	 
	 	(12	)	 	Outstanding Loan Balance, which equals (5) above plus (9) above minus
(10) above
minus (11) above:
	 	 	 	 
	 	 	 	 	 
	 	 	 

Ex. 1-1

© American International Group, Inc. All rights reserved.

 

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

EXHIBIT C

FORM OF APPLICATION FOR LENDER PROTECTION INSURANCE COVERAGE

IMPERIAL LIFE FINANCING II, LLC

191 Peachtree Street NE

Suite 3300

Atlanta, Georgia 30303

[INSERT DATE]

	To: 	 	Lexington Insurance Company

70 Pine Street, 5th Floor

New York, New York 10270

Facsimile: (212) 943-4054

Attention: Surveillance Manager
	 
	Re: 	 	Application For Lender Protection Insurance Coverage

	1.	 	This Application For Lender Protection Insurance Coverage, pursuant to the Lender
Protection Insurance Policy, Policy Number 7113486 (the “Policy”), with an
effective date of March 13, 2009, is hereby submitted to Lexington Insurance Company.
Capitalized terms used in this Application For Lender Protection Insurance Coverage and
not otherwise defined herein shall have the meaning set forth in the Policy.
	 
	2.	 	The following information is hereby provided in connection with this
application:

General Information

	 	 	 

	Number of Covered Policies
on Covered Loan:
	 	 
	 

	 	 
	 
	 	 
	Covered Loan Number:
	 	 
	 

	 	 
	 
	 	 
	Covered Loan Amount:
	 	 
	 

	 	 
	 
	 	 
	Covered Expenses: 
	 	 
	 

	 	 
	 
	 	 
	Total Loan Amount: 
	 	 
	 

	 	 
	 
	 	 
	 Loan Rate:
	 	 
	 

	 	 
	 
	 	 
	 
	 	 
	 

	 	 
	 
	 	 
	Proposed Coverage Certificate Effective Date:
	 	 
	 

	 	 
	 
	 	 
	Proposed Maturity Date:
	 	 
	 

	 	 

C-1

 

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

	 	 	 

	 

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

	 	 

First Covered Policy

	 	 	 

	Covered Policy ID:
	 	 
	 

	 	 
	 
	 	 
	Life Insurance Carrier:
	 	 
	 

	 	 
	 
	 	 
	Covered Policy Number:
	 	 
	 

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

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

	 	 
	 
	 	 
	Proposed Total Life Insurance
Premium:
	 	 
	 

	 	 
	 
	 	 
	Proposed Covered Life 

Insurance Premium:
	 	 
	 

	 	 
	 
	 	 
	Death Benefit:
	 	 
	 

	 	 

Second Covered Policy (if applicable)

	 	 	 

	Covered Policy ID
	 	 
	 

	 	 
	 
	 	 
	Life Insurance Carrier:
	 	 
	 

	 	 
	 
	 	 
	Covered Policy Number:
	 	 
	 

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

	 	 

C-2

© American International Group, Inc. All rights reserved.

 

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

	 	 	 

	 

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

	 	 
	 
	 	 
	Proposed Total Life 

Insurance Premium:
	 	 
	 

	 	 
	 
	 	 
	Proposed Covered Life Insurance Premium:
	 	 
	 

	 	 
	 
	 	 
	Death Benefit:
	 	 
	 

	 	 

	3.	 	Imperial Life Financing II, LLC hereby represents and warrants to the Insurer, both as
of the date of this Application For Lender Protection Insurance and as of the date (if
any) on which the Insurer issues the corresponding Coverage Certificate, that it has a
place of business located within the state of Georgia.
	 
	4.	 	Imperial Life Financing II, LLC hereby represents and warrants to the Insurer, both as
of the date of this Application For Lender Protection Insurance and as of the date (if
any) on which the Insurer issues the corresponding Coverage Certificate, that to the
actual knowledge of the Insured or any of its Authorized Officers (i) no proposed Covered
Policy that is listed above has been Contested, (ii) the Life Insurance Carrier(s) that
issued or will issue each proposed Covered Policy listed above has not made any written
allegation or objection that could reasonably be expected to result in a Contest or that
could reasonably be expected to lead to questions regarding the validity of any such life
insurance policy (including without limitation questions regarding insurable interest) and
(iii) no proposed Covered Policy listed above, related Covered Loan or related premium
finance loan is the subject of a Prohibited Act.
	 
	5.	 	Imperial Life Financing II, LLC certifies that the information contained in this
Application For Lender Protection Insurance Coverage is complete, true, correct and not
misleading.
	 
	 	 	Upon your acceptance of the Covered Loan described above for coverage
under the Policy, please issue a corresponding Coverage Certificate.

	 	 	 	 	 
	 	IMPERIAL LIFE FINANCING II, LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

C-3
© American International Group, Inc. All rights reserved.

 

 

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

EXHIBIT B

COPY OF CONTINGENT POLICY

[SEE ATTACHED]

 

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

STRICTLY CONFIDENTIAL AND PROPRIETARY

Execution Copy

NATIONAL FIRE & MARINE INSURANCE COMPANY

3024 Harney Street

Omaha, Nebraska 68131

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

CONTINGENT LENDER PROTECTION INSURANCE POLICY

POLICY NUMBER: 92 SRD 102507

DECLARATIONS

	 	 	 	 	 

	Item 1.

	 	Insured’s Name:
	 	Imperial Life Financing II, LLC
	 
	 	 	 	 
	 

	 	Insured’s Address:
	 	191 Peachtree Street NE

Suite 3300

Atlanta, Georgia 30303

Attention: David Manchester
	 
	 	 	 	 
	Item 2.

	 	Effective Date:
	 	March 13, 2009
	 
	 	 	 	 
	Item 3.

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

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

	 	Contingent LPIC

Premium:
	 	For each Covered Loan, the Contingent LPIC Premium shall
be the amount set forth as such in the applicable Coverage
Certificate.
	 
	 	 	 	 
	 	 	All Contingent LPIC Premium is exclusive of any premium tax, any intermediary
commission and any other applicable taxes, fees or surcharges, all of which (if
applicable) shall be the sole responsibility of the Insured or its Surplus Lines
Broker.

	 	 	 	 	 

	Item 6.

	 	Surplus Lines Broker:

Mailing Address:
	 	William Lee Mershon

Hays Companies

80 S. 8th Street, Suite 700

Minneapolis, MN 55402
	 
	 	 	 	 
	 

	 	License No.:
	 	Georgia License No. 665715

i

 

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

STRICTLY CONFIDENTIAL AND PROPRIETARY

Execution Copy

	 	 	 	 	 
	 	NATIONAL FIRE & MARINE INSURANCE

COMPANY

 	 
	 	By:  	 	 
	 	 	Authorized Representative 	 
	 	 	Signed on March 13, 2009	 

ii

 

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

	 	 	 	 	 

NATIONAL FIRE & MARINE INSURANCE COMPANY

3024 Harney Street

Omaha, Nebraska 68131

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

CONTINGENT LENDER PROTECTION INSURANCE POLICY

POLICY NUMBER: 92 SRD 102507

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

Section I. Insuring Agreement

Upon and as of the occurrence of a Credit Event:

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

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

Section II. Contingent LPIC Premium

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

Section III. Conditions Precedent to Coverage; Confirmation

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

Section IV. Termination

This Policy shall be continuous from the Effective Date until the earlier of: (i) the date of
the second (2nd) anniversary of the Effective Date or (ii) the date this Policy is terminated
pursuant to this Section IV. The Insurer shall have the right to terminate this
Policy any time after November 1, 2009, upon 30 days written notice to the Insured.
Termination of this Policy shall

2

 

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

not affect (x) coverage in respect of any Coverage Certificate issued to the Insured
by the Original LPIC Insurer prior to the effective date of such termination or (y) the
confidentiality provisions set forth in Section VII.G. of the Original LPIC
Policy and incorporated herein by reference, which shall survive the termination of this
Policy.

Section V. Representations, Warranties, Covenants and Acknowledgements

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

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

	B.	 	The Insured hereby makes each of the representations, warranties, covenants and
acknowledgments set forth in Section VII of the Original LPIC Policy in
favor of the Insurer hereunder as of the Effective Date as if such
representations, warranties, covenants and acknowledgements were set forth in
this Policy.

Any breach of the representations, warranties or covenants made or deemed made in this
Section V. shall not expand the conditions to payment set forth in Section IV.
of the Original LPIC Policy and incorporated by reference herein or the exclusions to payment
set forth in Section V. of the Original LPIC Policy and incorporated by reference
herein. Notwithstanding the foregoing, the Insured acknowledges that the Insurer is entering
into this Policy in reliance upon the genuineness of the representations, warranties and
covenants made or deemed made in Section V.B., and the Insurer shall retain all
remedies available at law or in equity in connection with any such breach; provided that no
right of offset shall exist with regard to any amount due from the Insured to the Insurer as a
result of a breach of any representation, warranty or covenant set forth in this Section
V or Section VII of the Original LPIC Policy.

Section VI. Definitions

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

	A.	 	“Contingent LPIC Premium” means, for each Covered Loan, [*]% of the related
Limit of Liability, which amount is set forth in U.S. dollars in the applicable Coverage
Certificate.
	 
	B.	 	“Credit Event” means the Original LPIC Insurer (a) is unable to pay its insurance

3

 

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

	 	 	obligations under any insurance policy in full or admits in writing its inability
generally to pay its insurance obligations under insurance policies in full as they become
due, (b) enters into liquidation, (c) seeks or becomes subject to an insolvency proceeding
in the United States or a rehabilitator or other similar official is appointed for all or
substantially all its assets or (d) becomes subject to a corrective order or similar
document issued by an insurance regulator that cites or otherwise references its financial impairment or
failure to meet minimum levels of statutory capital or surplus and which prohibits
payments of claims as and when due.
	 
	C.	 	“Declarations” means the declaration pages attached to the front of this Policy.
	 
	D.	 	“Effective Date” has the meaning set forth in Item 2 of the Declarations.
	 
	E.	 	“Free Look Period” means the period during which a Retail Borrower or its assignee
may, pursuant to the terms of a Covered Policy or applicable law, cancel such Covered Policy
and receive a refund of all premiums previously paid thereunder.
	 
	F.	 	“Insured” has the meaning set forth in the preamble of this Policy.
	 
	G.	 	“Insured’s Account” means a bank account of the Insured located in located in the
State of Georgia with the following account information:

Bank:

ABA:

Account Number: 1

Account Name:

Type of Account:

	H.	 	“Insurer” has the meaning set forth in the preamble of this Policy.
	 
	I.	 	“LPIC Premium” means, for each Covered Loan, the amount set forth as such in
the applicable Coverage Certificate.
	 
	J.	 	“Original LPIC Policy” means, as of any date, Lender Protection Insurance Policy,
Policy No. 7113486 issued by the Original LPIC Insurer and effective March 13, 2009, as the
same may be amended, endorsed, supplemented or otherwise modified from time to time through
(i) such date or (ii) if a Credit Event shall occur, the day prior to the day on which the
Credit Event occurs.
	 
	K.	 	“Original LPIC Insurer” means Lexington Insurance Company or its successors and
permitted assigns under the Original LPIC Policy.
	 
	L.	 	“Periodic Bordereau” has the meaning set forth in Section III.C. of this
Policy.
	 
	M.	 	“Policy” has the meaning set forth in the preamble hereof.
	 
	N.	 	“Surplus Lines Broker” has the meaning set forth in Item 6 of the Declarations.
	 
	O.	 	“Term” has the meaning set forth in Item 3 of the Declarations.
	 
	P.	 	“Transaction Documents” means this Policy, the Original LPIC Policy and any Coverage
Certificates issued under the Original LPIC Policy and incorporated by reference in this
Policy, as any of the foregoing may be amended, supplemented, amended and restated,

4

 

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

	 	 	or otherwise modified from time to time.

Section VII. Confidentiality

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

Section VIII. General Policy Provisions

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

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

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

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

If to the Insurer:

National Fire & Marine Insurance Company 

100 First Stamford Place

Stamford, CT 06902

Facsimile: (203) 363-5221

Attention: General Counsel

If
to the Insured:

Imperial Life Financing II, LLC

191 Peachtree Street NE, Suite 3300

Atlanta, Georgia 30303

Facsimile: (404) 736-3620

Attention: David Manchester

	 	 	With regard to any notices or other documents referenced in this Policy that are to be
delivered to the Insured by any party other than the Insurer, such notices shall be deemed
to have been delivered to the Insured in the event that they were delivered to any named
agent, servant or employee of the Insured or any other third party appointed by the
Insured to perform any duties on behalf of the Insured in connection with this Policy.
	 
	H.	 	Governing Law: This Policy shall be interpreted and all disputes and controversies
arising under or related to this Policy shall be governed by and decided under the internal
laws of the State of New York (including without limitation Section 5-1401 of the General
Obligations Law of the State of New York), without regard to conflicts of laws principles
that would require or allow for the application of any other jurisdiction’s law.
	 
	I.	 	Service of Suit: Subject to Section XI.M. of the Original LPIC Policy and
incorporated herein by reference, in the event of failure of the Insurer to pay any amount
claimed to be due hereunder, the Insurer, at the request of the Insured, will submit to the
jurisdiction of a court of competent jurisdiction within the United States. Nothing in this
condition constitutes or should be understood to constitute a waiver of the Insurer’s rights
to commence an action in any court of competent jurisdiction in the United States, to remove
an action to a United States District Court or to seek a transfer of a case to another court
as permitted by the laws of the United States or of any state in the United

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

	 	 	States. Service of process in such suit may be made upon General Counsel, National Fire
& Marine Insurance Company, 100 First Stamford Place, Stamford, CT 06902 or his or her
representatives, with a copy to National Fire & Marine Insurance Company, 3024 Harney
Street, Omaha, NE 68131, Attention: President. In any suit instituted against the Insurer
upon this Policy, the Insurer shall abide by the final decision of such court or of any
appellate court in the event of any appeal.
	 
	 	 	Further, pursuant to any statute of any state, territory, or district of the United States
which makes provision therefor, the Insurer hereby designates the Superintendent,
Commissioner, or Director of Insurance, other officer specified for that purpose in the
statute, or his or her successor or successors in office as its true and lawful attorney
upon whom may be served any lawful process in any action, suit, or proceeding instituted
by or on behalf of the Insured or any beneficiary hereunder arising out of this Policy,
and hereby designates the above named counsel as the individual to whom the said officer
is authorized to mail such process or a true copy thereof.
	 
	J.	 	Unwinding of Covered Policies: Notwithstanding any other provision in this Policy,
if, after the issuance of a Coverage Certificate, the applicable Retail Borrower exercises its
right to cancel a Covered Policy relating to the applicable Covered Loan within the applicable
Free Look Period, then (1) all coverage under this Policy relating to such Coverage
Certificate shall be void ab initio, (2) the Insurer shall return to the Insured all
previously received Contingent LPIC Premium relating to such Covered Loan and (3) each of the
Insurer and the Insured shall bear its own costs and expenses relating thereto, with no rights
to indemnification from the other party for such costs and expenses.
	 
	K.	 	Counterparts: This Policy may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute one and the
same document.
	 
	L.	 	Validity: Notwithstanding anything to the contrary contained in this Policy or the
Original LPIC Policy, the termination of the Original LPIC Policy pursuant to Section
IV.G. thereof shall not affect the validity or enforceability of this Policy or each term,
condition, limitation and exclusion of the Original LPIC Policy incorporated by reference
herein.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

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

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

Secretary                                                             

NATIONAL FIRE & MARINE INSURANCE

COMPANY

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

IN WITNESS WHEREOF, the Insured has caused this Policy to be signed by its duly authorized
representative:

	 	 	 	 	 
	 	IMPERIAL LIFE FINANCING II, LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

8

 

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

	 	 	 	 	 

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

			
	 	 	 
	 
	 	                
                  
                              

Secretary

NATIONAL FIRE & MARINE INSURANCE

COMPANY

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

IN WITNESS WHEREOF, the Insured has caused this Policy to be signed by its duly
authorized representative:

	 	 	 	 	 
	 	IMPERIAL LIFE FINANCING II, LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

8

 

	 	 	 	 	 

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

EXHIBIT C

Local Counsel Opinion Questions

(Loan State) 

	1.	 	Does the state in which a Retail Loan will be made to a Retail Lender (the “Loan
State”) have a usury law that is applicable to the individual lending transactions in the
contemplated program; if so, what is the maximum permissible interest rate under the usury
law; and if relevant, whether any loan origination fees and any pass-through of the life
insurance policy premium and other fees to be charged would be included as part of “interest”
under such usury law?
	 
	2.	 	Does the Loan State have an insurance premium finance law and, if so, does such law apply to
the individual lending transactions in the contemplated program? If so, would the lending
transactions and the related Loan Documents be in compliance with such premium finance law? Do
the Loan State’s general consumer lending laws apply to the Retail Loans and/or to the Retail
Lender if there is not a premium finance law in effect in the Loan State or if there is not an
Imperial Party that is a licensed premium finance company in the Loan State? If so, would the
individual lending transactions and the related Loan Documents be in compliance with the
general consumer lending laws?
	 
	3.	 	Does the Loan State have a life or viatical settlement law and, if so, does it apply to the
individual lending transactions in the contemplated program? If yes, then how?
	 
	4.	 	Are life insurance policies assignable to a lender as security under the Loan State’s law?
	 
	5.	 	What are the minimum criteria needed to establish an irrevocable life insurance trust in the
Loan State?

 

 

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

	6.	 	What are the minimum criteria needed to redomicile in the Loan State an irrevocable life
insurance trust previously established under the laws of another state, and have the same
recognized as effective under the laws of the Loan State?

 

 

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

EXHIBIT D

Local Counsel Opinion Questions

(Policy State) 

	1.	 	What are the minimum criteria needed to establish an irrevocable life insurance trust in
the state where the irrevocable life insurance trust was domiciled at the time that it
purchased the policy (the “Policy State”)?
	 
	2.	 	What are the minimum criteria needed to amend the terms of the trust agreement of an
irrevocable life insurance trust validly established or existing under the laws of the Policy
State?
	 
	3.	 	What state’s insurable interest laws would a state court (or a federal court) apply to
determine whether an irrevocable life insurance trust (or its trustee) has an insurable
interest in the life of the insured (assuming that a case would be brought in and remain
in either state or federal court in the Policy State, rather than a state or federal court
in the home state of the insured)?

 

 

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

	4.	 	Will the life insurance policy issued to an irrevocable life insurance trust established in
the Policy State be supported by a valid insurable interest under the
	 
	5.	 	law of the Policy State, including, if applicable, does the Policy State’s law address or
provide that a trustee of a trust, or the trust itself, has an insurable interest in the life
of the grantor or settlor of such trust?exv10w9

Exhibit 10.9

Prepared by and return to:

Seyfarth Shaw LLP

620 Eighth Avenue

New York, New York 10018

Attention: Mitchell S. Kaplan

 

LOAN ASSUMPTION

AND

SUBSTITUTION AGREEMENT

 

Date: As of September 8, 2010

 

	 	 	 	 	 

	 

	 	Premises:
	 	2424 Erwin Road
	 

	 	 	 	Durham, North Carolina
	 
	 	 	 	 
	 

	 	Tax Parcel Id No.:
	 	0812-15-72-2463

 

 

LOAN ASSUMPTION AND SUBSTITUTION AGREEMENT

     THIS LOAN ASSUMPTION AND SUBSTITUTION AGREEMENT (this “Agreement”) is made and entered into as
of September 8, 2010, by and among Hines Global REIT Hock Plaza I LLC, having an address of 2800
Post Oak Boulevard, Suite 4800, Houston, TX 77056 (“Assuming Borrower”), Hines Global REIT
Properties LP having an address at 2800 Post Oak Boulevard, Suite 4800, Houston, TX 77056
(“Assuming Indemnitor”), Brickman Durham LLC, having an address at 712 Fifth Avenue, 6th Floor, New
York, New York 10019 (“Original Borrower”), and Bruce S. Brickman, Kathleen Corton and Roderick
O’Connor, each having an address at 712 Fifth Avenue, 6th Floor, New York, New York 10019
(individually and collectively, if more than one, “Original Indemnitor”) in favor of BANK OF
AMERICA, N.A., AS TRUSTEE FOR THE REGISTERED HOLDERS OF GS MORTGAGE SECURITIES CORPORATION II,
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2006-GG6, whose mailing address is c/o Wells
Fargo Bank, N.A., Commercial Real Estate Services, NC1075, 201 S. College Street, Charlotte, NC
28244-1075, Attn: Portfolio Manager (“Lender”). Capitalized terms used herein without definition
shall have the respective meanings ascribed thereto in the Loan Agreement (as defined below).

Recitals

     A. Greenwich Capital Financial Products, Inc. (the “Original Lender”), pursuant to the Loan
Documents (as hereinafter defined) made a loan to Original Borrower in the original principal
amount of $80,000,000.00 (the “Loan”). The Loan is evidenced and secured by, among other things,
the following documents executed in favor of Original Lender by Original Borrower and Original
Indemnitor:

	 	(1)	 	Promissory Note dated November 17, 2005, payable by Original Borrower to
Original Lender in the original principal amount of $80,000,000.00 (the “Note”);
	 
	 	(2)	 	Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture
Filing of even date with the Note, granted by Original Borrower to Lawyers Title
Insurance Corporation, as Trustee for the benefit of Original Lender, recorded in Book
5026, Page 648 in the real estate records of Durham County, North Carolina (“Recorder’s
Office”) (the “Mortgage”);
	 
	 	(3)	 	Assignment of Leases and Rents of even date with the Note granted by Original
Borrower to Original Lender, recorded in Book 5026, Page 670, in the Recorder’s Office
(the “Assignment”);
	 
	 	(4)	 	UCC-1 financing statements with Original Borrower, as debtor, and Original
Lender, as secured party, filed with the Recorder’s Office in Book 5026, Page 681 and
with the Secretary of State of Delaware as Instrument No. 53585081 (collectively, the
“UCC’s”);
	 
	 	(5)	 	Loan Agreement dated as of November 17, 2005 between Original Borrower and
Original Lender (the “Loan Agreement”);

A-1

 

	 	(6)	 	Guaranty of Recourse Obligations by and between Original Indemnitor and
Original Lender of even date with the Note (the “Indemnity Agreement”);
	 
	 	(7)	 	Clearing Account Agreement of even date with the Note by and between Original
Borrower, Original Lender and Citizens Bank of Pennsylvania (the “Clearing Account
Agreement”);
	 
	 	(8)	 	Deposit Account Agreement of even date with the Note by and between Original
Borrower, Original Lender and Wachovia Bank, National Association (the “Deposit Account
Agreement”);
	 
	 	(9)	 	Consent and Subordination of Manager of even date with the Note by and between
Original Borrower, Original Lender and Brickman Management LLC (the “Manager’s
Subordination Agreement”); and
	 
	 	(10)	 	Assignment of Agreements, Licenses, Permits and Contracts of even date with the
Note by and between Original Borrower and Original Lender (the “Assignment of
Contracts”).

The foregoing documents, together with any and all other documents executed by Original Borrower
and/or Original Indemnitor in connection with the Loan, are collectively called the “Loan
Documents.” As used herein, the term “Assuming Obligors” shall mean Assuming Borrower and Assuming
Indemnitor; and the term “Original Obligors” shall mean Original Borrower and Original Indemnitor.

     B. Original Lender assigned, sold and transferred its interest in the Loan and all Loan
Documents to Lender and Lender is the current holder of all of Original Lender’s interest in the
Loan and Loan Documents.

     C. Original Borrower continues to be the owner of the Property (as defined below).

     D. Pursuant to that certain Purchase and Sale Agreement dated effective March 5, 2010 (as
amended and as assigned to Assuming Borrower, the “Sales Agreement”), Original Borrower agreed to
sell, and Assuming Borrower agreed to purchase, that certain real property more particularly
described on Exhibit A, attached hereto, together with all other property encumbered by the
Mortgage and the other Loan Documents (collectively, the “Property”). The Sales Agreement requires
that the Assuming Borrower assume the Loan and the obligations of Original Borrower under the Loan
Documents, and conditions the closing of the sale of the Property upon the Lender’s consent to the
sale of the Property and the assumption of the Loan.

     E. Pursuant to Section 5.26.2 of the Loan Agreement, any sale or transfer of the Property
requires the Lender’s prior written consent. Original Borrower and Assuming Borrower have
requested that Lender consent to the sale, conveyance, assignment and transfer of the Property by
Original Borrower to Assuming Borrower, subject to the Mortgage and the other Loan Documents, and
to the assumption by Assuming Borrower of the Loan and the assumption by Assuming Obligors of the
obligations of Original Obligors under the Loan Documents, to the extent set forth herein (the
“Assumption”).

2

 

     F. Lender is willing to consent to the sale, conveyance, assignment and transfer of the
Property by Original Borrower to Assuming Borrower, subject to the Mortgage and the other Loan
Documents (all as modified by this Agreement), and to the Assumption of and subject to the terms
and conditions set forth in this Agreement and in the Mortgage and in the other Loan Documents.

     G. Lender, Original Obligors and Assuming Obligors, by their respective executions hereof,
evidence their consent to the transfer of the Property to Assuming Borrower and the Assumption as
hereinafter set forth.

Statement of Agreement

     In consideration of the mutual covenants and agreements set forth herein, the parties hereto
hereby agree as follows:

     1. Representations, Warranties, and Covenants of Original Obligors, Release of Lender.

          (a) Original Obligors hereby represent to Lender, as of the date hereof, that (i)
simultaneously with the execution and delivery hereof, Original Borrower has conveyed and
transferred all of the Property to Assuming Borrower; (ii) simultaneously with the execution and
delivery hereof, Original Borrower has assigned and transferred to Assuming Borrower all leases,
tenancies, security deposits and prorated rents of the Property in effect as of the date hereof
(“Leases”) retaining no rights therein or thereto; (iii) Original Borrower has not received a
mortgage from Assuming Borrower encumbering the Property to secure the payment of any sums due
Original Borrower or obligations to be performed by Assuming Borrower; (iv) the Mortgage is a valid
first lien on the Property for the full unpaid principal amount of the Loan and all other amounts
as stated therein; (v) no Event of Default (as defined in the Loan Agreement) has occurred and is
continuing; (vi) there are no defenses, set-offs or rights of defense, set-off or counterclaim
whether legal, equitable or otherwise to the obligations evidenced by or set forth in the Loan
Documents; (vii) all provisions of the Loan Documents are in full force and effect, except as
modified herein; (viii) except as may otherwise be permitted pursuant to the Loan Documents, there
are no subordinate liens of any kind covering or relating to the Property nor are there any
mechanics’ liens or liens for unpaid taxes or assessments encumbering the Property, nor has notice
of a lien or notice of intent to file a lien been received; and (ix) except as otherwise disclosed
to Lender in that certain side letter from Assuming Obligors to Lender delivered to Lender on, and
dated as of, the date hereof, the representations and warranties made by Original Obligors in the
Loan Documents or in any other documents or instruments delivered in connection with the Loan
Documents, including, without limitation, all representations and warranties with respect to
environmental matters, are true, on and as of the date hereof, with the same force and effect as if
made on and as of the date hereof.

          (b) Original Obligors hereby covenant and agree that: (i) from and after the date hereof,
Lender may deal solely with each of Assuming Obligors in all matters relating to their respective
obligations under or relating to the Loan, the Loan Documents, and the Property; (ii) Original
Obligors shall not at any time hereafter take (x) a mortgage or other lien encumbering the Property
or (y) a pledge of direct or indirect interests in Assuming Borrower or

3

 

Assuming Obligors to secure any sums to be paid or obligations to be performed by Assuming
Obligors so long as any portion of the Loan remains unpaid; and (iii) with the exception of any
notice requirements expressly set forth in the Indemnity Agreement, Lender has no further duty or
obligation of any nature relating to the Loan or the Loan Documents to Original Obligors.

Original Obligors understand and intend that Lender shall rely on the representations, warranties
and covenants contained herein.

     2. Representations, Warranties, and Covenants of Assuming Obligors.

          (a) Each Assuming Obligor hereby represents and warrants to Lender as to itself, as of the
date hereof, that: (i) simultaneously with the execution and delivery hereof, Assuming Borrower
has purchased from Original Borrower all of the Property, and has received and accepted Original
Borrower’s assignment of the Leases; (ii) Assuming Borrower has assumed the performance of Original
Borrower’s obligations under the Leases from and after the date hereof; (iii) Assuming Borrower has
not granted to Original Borrower (x) a mortgage or other lien upon the Property or (y) a pledge of
direct or indirect interests in the Assuming Borrower to secure any debt or obligations owed to
Original Borrower; (iv) to the knowledge of each Assuming Obligor, no default or Event of Default
under the Loan Documents has occurred or is continuing; (v) to the knowledge of each Assuming
Obligor, all provisions of the Loan Documents are in full force and effect; (vi) to the knowledge
of each Assuming Obligor, the representations and warranties made in the Loan Documents or in any
other documents or instruments delivered in connection with the Loan Documents are true, on and as
of the date hereof, except as such representations or warranties relate to characteristics of the
Original Borrower or Original Indemnitor; and (vii) Assuming Obligors have reviewed all of the Loan
Documents and consent to the terms thereof, as modified by this Agreement.

          (b) Assuming Borrower shall not hereafter, without Lender’s prior consent in accordance with
the terms of the Loan Documents, further encumber the Property or sell or transfer the Property or
any interest therein, except as may be permitted in the Loan Documents. Except as otherwise
disclosed to Lender in that certain side letter from Assuming Obligors to Lender delivered to
Lender on, and dated as of, the date hereof, Assuming Obligors have no knowledge that any of the
representations and warranties made by the Original Obligors herein or in the other Loan Documents
are untrue, incomplete or incorrect.

          (c) Assuming Indemnitor hereby represents and warrants to Lender that Assuming Indemnitor is
an affiliate of Assuming Borrower and Assuming Indemnitor will derive substantial economic benefit
from Lender’s consent to the Assumption. Assuming Indemnitor hereby acknowledges and agrees that
Assuming Indemnitor has executed this Agreement and agreed to be bound by the covenants and
agreements set forth herein applicable to Assuming Indemnitor in order to induce Lender to consent
to the transaction described herein. Accordingly, Assuming Indemnitor acknowledges that Lender
would not consent to the transaction described herein without the execution and delivery by
Assuming Indemnitor of this Agreement.

Assuming Obligors understand and intend that Lender shall rely on their respective representations,
warranties and covenants contained herein.

4

 

     3. Assumption of Obligations of Borrower. Assuming Borrower hereby assumes the Debt
(as defined in the Loan Agreement), and Assuming Borrower hereby assumes all the other obligations
of Original Borrower of every type and nature set forth in the Loan Documents in accordance with
their respective terms and conditions, as the same may be modified by this Agreement. Assuming
Borrower further agrees to abide by and be bound by all of the terms of the Loan Documents
applicable to the “Borrower”, “Maker”, “Assignor”, “Trustor”, “Grantor” or “Mortgagor” (as
applicable), in accordance with their respective terms and conditions, including but not limited
to, the representations, warranties, covenants, assurances and indemnifications therein, all as
though each of the Loan Documents had been made, executed, and delivered by Assuming Borrower.
Assuming Borrower agrees to pay when and as due all sums due under the Note, and agrees to pay,
perform, and discharge each and every other obligation of payment and performance of the
“Borrower”, “Maker”, “Assignor”, “Trustor”, “Grantor” or “Mortgagor” (as applicable) pursuant to
and as set forth in the Loan Documents, at the time, in the manner and otherwise in all respects as
therein provided. The foregoing assumption by Assuming Borrower is absolute and unconditional, is
not subject to any defenses, waivers, claims or offsets nor may it be affected or impaired by any
agreement, condition, statement or representation of Original Borrower or any borrower or any
failure to perform the same and that Assuming Borrower hereby relinquishes, waives and releases any
and all such defenses, claims, offsets and causes of action. Assuming Borrower hereby
acknowledges, agrees and warrants that (i) there are no rights of set-off or counterclaim, nor any
defenses of any kind, whether legal, equitable or otherwise, which would enable Assuming Borrower
to avoid or delay timely performance of its obligations under the Loan Documents, as applicable;
and (ii) there are no monetary encumbrances or liens of any kind or nature against the Property
except those created by the Loan Documents, and all rights, priorities, titles, liens and equities
securing the payment of the Note are expressly recognized as valid and are in all things renewed,
continued and preserved in force to secure payment of the Note, except as amended herein. Assuming
Borrower represents and warrants to Lender that Assuming Borrower has actual knowledge of all terms
and conditions of the Loan Documents, and agrees that, except as expressly provided herein, Lender
has no obligation or duty to provide any information to Assuming Borrower regarding the terms and
conditions of the Loan Documents.

     4. Assumption of the Obligations of the Indemnitor under the Indemnity Agreement;
Substitution of Indemnitor. From and after the date of this Agreement, Assuming Indemnitor
shall be obligated and responsible for the performance of each and all of the obligations and
agreements of the “Indemnitor”, “Guarantor” and/or “Key Principal” (collectively referred to herein
as “Indemnitor”) under the Indemnity Agreement and the other Loan Documents to which Original
Indemnitor is a party, and Assuming Indemnitor shall be liable and responsible for each and all of
the liabilities of the Indemnitor thereunder, and shall be substituted in lieu of and in place of
Original Indemnitor, as fully and completely as if Assuming Indemnitor had originally executed and
delivered such Loan Documents as Indemnitor thereunder, including, without limitation, all of those
obligations, agreements and liabilities which would have, but for the provisions of this Agreement,
been the obligations, agreements and liabilities of Original Indemnitor, without regard to when
such obligations, agreements and liabilities arise, accrue or have arisen or accrued, and without
regard to Indemnitor then responsible or liable therefor at the time of such accrual. From and
after the date hereof, Assuming Indemnitor further agrees to abide by and be bound by all of the
terms of the Loan Documents having reference to the Indemnitor, all as though each of the Loan
Documents to

5

 

which Original Indemnitor is a party had been made, executed, and delivered by Assuming
Indemnitor as the Indemnitor. From and after the date hereof, the Assuming Indemnitor hereby
agrees to pay, perform, and discharge each and every obligation of payment and performance of the
Indemnitor under, pursuant to and as set forth in the Loan Documents at the time, in the manner and
otherwise in all respects as therein provided.

Notwithstanding anything herein or in the other Loan Documents to the contrary, Assuming Guarantor
shall not be liable under the Indemnity Agreement with respect to any and all representations or
warranties (other than representations and warranties concerning Environmental Laws or Hazardous
Substances) relating to information or deliveries provided by Original Obligors in connection with
the closing of the Loan in November, 2005; provided, however, that, to the extent any such
representation or warranty would give rise to an Event of Default under Section 8.1 of the Loan
Agreement, Assuming Borrowers shall be and remain liable therefor.

     5. Notices to Indemnitor. Without amending, modifying or otherwise affecting the
provisions of the Loan Documents except as expressly set forth herein, Lender shall, from and
after the date of this Agreement, deliver any notices to the Indemnitor which are required to be
delivered pursuant to the Loan Documents, or are otherwise delivered by Lender thereunder at
Lender’s sole discretion, to Assuming Indemnitor’s address set forth above.

     6. Consent to Conveyance, Assumption and Substitution of Indemnitor; Release of Original
Obligors. Subject to the terms and conditions set forth in this Agreement, Lender consents to:
(a) the sale, conveyance, assignment and transfer of the Property by Original Borrower to Assuming
Borrower, subject to the Mortgage and the other Loan Documents; (b) the assumption by Assuming
Borrower of the Loan and the obligations of Original Borrower under the Loan Documents; and (c) the
assumption by Assuming Indemnitor of the obligations of the Original Indemnitor under the Loan
Documents. Original Obligors are hereby released from any liability to Lender under any and all of
the Loan Documents first arising or accruing subsequent to the Assumption. Lender’s consent to
such transfer and Assumption shall, however, not constitute its consent to any subsequent transfers
of the Property. Original Obligors hereby acknowledge and agree that the foregoing release shall
not be construed to release Original Obligors from any personal liability under the Note or any of
the other Loan Documents for any acts or events occurring or obligations arising prior to or
simultaneously with the closing of the transaction described herein, but such liability and any
liability under this Agreement shall be limited as and to the extent set forth in the Loan
Documents, including, without limitation, Section 10.1 of the Loan Agreement. Notwithstanding the
foregoing release or any other term contained in this Agreement, Original Obligors shall continue
to be liable for and guarantee payment to Lender of all obligations under the Note arising prior to
the closing of the Assumption in the event of the voluntary bankruptcy or insolvency proceeding of
Original Borrower and such bankruptcy or insolvency proceeding adversely impacts Lender in any
material way in respect of the Loan. Lender acknowledges and agrees that no notices of default
which have not been cured are presently outstanding with respect to the Loan and further
acknowledges and agrees that Lender, without independent investigation, does not have knowledge of
any defaults presently outstanding with respect to the Loan.

6

 

     7. Release and Covenant Not to Sue. Original Obligors and Assuming Obligors, on
behalf of themselves and their heirs, successors and assigns, hereby release and forever discharge
Lender, any trustee of the Loan, any servicer of the Loan, each of their respective predecessors in
interest and successors and assigns, together with the officers, directors, partners, employees,
investors, certificate holders, agents, attorneys and consultants of each of the foregoing
(collectively, the “Lender Parties”), from all debts, accountings, bonds, warranties,
representations, covenants, promises, contracts, controversies, agreements, claims, damages,
judgments, executions, actions, inactions, liabilities demands or causes of action of any nature,
at law or in equity, known or unknown, which Original Obligors and Assuming Obligors now have by
reason of any cause, matter, or thing through and including the date hereof, to the extent arising
out of or relating to: (a) the Loan, including, without limitation, its funding, administration
and servicing; (b) the Loan Documents; (c) the Property; (d) any reserve and/or escrow balances
related to the Loan held by Lender or any servicers of the Loan; or (e) the sale, conveyance,
assignment and transfer of the Property. Original Obligors and Assuming Obligors, on behalf of
themselves and their heirs, successors and assigns, covenant and agree never to institute or cause
to be instituted or continue prosecution of any suit or other form of action or proceeding of any
kind or nature whatsoever against any of the Lender Parties by reason of or in connection with any
of the foregoing matters, claims or causes of action.

     8. Acknowledgment of Indebtedness. This Agreement recognizes the reduction of the
principal amount of the Note, if any, and the payment of interest thereon to the extent of payments
made by Original Borrower prior to the date of execution of this Agreement. The parties
acknowledge and agree that, as of September 7, 2010, the principal balance of the Note is
$80,000,000.00 and interest on the Note is paid to September 5, 2010. Assuming Borrower
acknowledges and agrees that the Loan, as evidenced and secured by the Loan Documents, is a valid
and existing indebtedness payable by Assuming Borrower to Lender. The parties acknowledge that
Lender is holding the following escrow and/or reserve balances:

	 	 	 	 	 

	Tax Escrow:
	 	$	745,238.64	 
	Insurance Escrow:
	 	$	55,665.82	 
	Capital Expense Reserve:
	 	$	38,708.77	 
	Rollover Reserve:
	 	$	809.02	 
	Special Rollover Reserve:
	 	$	0.00	 
	Operating Expense Subaccount:
	 	$	0.00	 
	Casualty/Condemnation Subaccount:
	 	$	0.00	 
	Cash Collateral Subaccount:
	 	$	0.00	 
	Security Deposit Subaccount:
	 	$	0.00	 

The parties acknowledge and agree that Lender shall continue to hold the escrow and reserve
balances for the benefit of Assuming Borrower in accordance with the terms of the Loan Documents.
Original Obligors covenant and agree that the Lender Parties have no further duty or obligation of
any nature to Original Obligors relating to such escrow and/or reserve balances. Original Obligors
hereby release and forever discharge the Lender Parties from any obligations to Original Obligors
relating to such escrow and/or reserve balances. Assuming Obligors and Lender acknowledge and
agree that the funds listed above constitute all of the reserve and escrow funds currently held by
Lender with respect to the Loan and Assuming Obligors

7

 

authorize such funds to be transferred to an account controlled by Lender for the benefit of Lender
and Assuming Borrower.

The parties further acknowledge and agree that Lender shall direct the Deposit Bank (as defined in
the Deposit Account Agreement) and the Clearing Bank (as defined in the Clearing Account Agreement)
to continue to hold and manage the accounts established pursuant to the Loan Agreement and the
Clearing Account Agreement for the benefit of Assuming Borrower in accordance with the terms
thereof. Original Obligors covenant and agree that the Deposit Bank and Lender Parties have no
further duty or obligation of any nature to Original Obligors relating to such accounts. Original
Obligors hereby release and forever discharge the Deposit Bank and Lender Parties from any
obligations to Original Obligors relating to such accounts.

     9. Modifications of the Loan Documents. The Loan Documents are hereby modified as
follows:

          (a) Section 6.1 of the Loan Agreement is hereby deleted in its entirety and the following
substituted in its stead:

     “6.1. “Notices. All notices, demands, requests or other communications hereunder or
required by law shall be in writing and shall be deemed to have been validly given or served by
delivery of the same in person to the intended addressee, or by depositing the same with a
reputable private courier service for next business day delivery, or by depositing the same in the
United States mail, postage prepaid, registered or certified mail, return receipt requested, in any
event addressed to the intended addressee addressed as follows:

	 	 	 

	If to Borrower:

	 	Hines Global REIT Hock Plaza I LLC
	 

	 	2800 Post Oak Boulevard, Suite 4800
	 

	 	Houston, TX 77056
	 
	 	 
	With a copy to:

	 	Hines Global REIT, Inc.
	 

	 	2800 Post Oak Blvd., 48th Floor
	 

	 	Houston, Texas 77056-6118
	 

	 	Attention: Mr. Charles Hazen
	 
	 	 
	With a copy to:

	 	Hines Interests Limited Partnership
	 

	 	2800 Post Oak Blvd., 48th Floor
	 

	 	Houston, Texas 77056-6118
	 

	 	Attention: Jason P. Maxwell, Esq.
	 
	 	 
	With a copy to:

	 	Hines Interests Limited Partnership
	 

	 	1 South Dearborn Street, Suite 2000
	 

	 	Chicago, IL 60603-2302
	 

	 	Attention: C. Kevin Shannahan

8

 

	 	 	 

	With a copy to:

	 	Hines Interests Limited Partnership
	 

	 	Five Ravinia Drive
	 

	 	Atlanta, Georgia 30346-2104
	 

	 	Attention: Mr. Kurt A. Hartman
	 
	 	 
	With a copy to:

	 	King & Spalding LLP
	 

	 	1180 Peachtree Street, NE
	 

	 	Atlanta, GA 30309-3521
	 

	 	Attention: D. Clayton Howell, Esq.
	 
	 	 
	If to Lender:

	 	BANK OF AMERICA, N.A., AS TRUSTEE FOR THE REGISTERED
HOLDERS OF GS MORTGAGE SECURITIES CORPORATION II,
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES, SERIES
2006-GG6
	 

	 	c/o Wells Fargo Bank, N.A., Commercial Real Estate Services,
	 

	 	NC1075, 201 S. College Street,
	 

	 	Charlotte, NC 28244-1075
	 

	 	Attn: Portfolio Manager
	 
	With a copy to:

	 	Seyfarth Shaw LLP
	 

	 	620 Eighth Avenue
	 

	 	New York, New York 10018
	 

	 	Attn: Mitchell S. Kaplan, Esq.

All notices, demands and requests shall be effective (i) upon delivery, if delivered in person,
(ii) one (1) business day after having been deposited for overnight delivery with any reputable
overnight courier service, or (iii) three (3) business days after having been deposited in the
United States mail as provided above. Rejection or other refusal to accept or the inability to
deliver because of changed address of which no notice was given as herein required shall be deemed
to be receipt of the notice, demand or request sent. By giving to the other party hereto at least
fifteen (15) days’ prior written notice thereof in accordance with the provisions hereof, the
parties hereto shall have the right from time to time to change their respective addresses and each
shall have the right to specify as its address any other address within the United States of
America.”

          In addition, the addresses for applicable notice parties in the other Loan Documents shall be
deemed changed to reflect the changes to Section 6.1 of the Loan Agreement.

          (b) The Mortgage is hereby modified to substitute the name and address (as listed above) of
Lender, as “Beneficiary,” and Assuming Borrower, as “Trustor,” in place of the “Beneficiary” and
“Trustor” names and addresses set forth therein.

9

 

          (c) The definition of “Approved Management Fee” in the Loan Agreement is hereby amended by
inserting “(i)” between the words “not to exceed” and “one and one half percent” in the second line
thereof and by inserting the following language at the end of the first sentence thereof:

“during the continuance of a Cash Management Period triggered by the Stated
Maturity Date and/or an Event of Default or (ii) three percent (3%) of the
gross revenue of the Property during the continuance of a Cash Management
Period resulting solely from a DSCR Cash Management Period and/or a Lease
Sweep Period; provided, however, that, notwithstanding the
foregoing, upon the subsequent occurrence of the Stated Maturity Date and/or
an Event of Default while the applicable DSCR Cash Management Period and/or
a Lease Sweep Period is continuing, the Approved Management Fee shall not
exceed one and one-half percent (1.50%) of the gross revenue of the
Property.”

          (d) The term “Brickman Fund” is hereby deleted wherever used in the Loan Documents and is
hereby replaced with the term “Hines Global REIT, Inc.”.

          (e) The term “Key Principals” in the Loan Agreement shall be deleted in its entirety and
replaced with the following:

               “Key Principals: “Hines Global REIT, Inc.”

          (f) (The definition of “Manager” in the Loan Agreement is hereby amended by deleting “Brickman
Management LLC” and substituting “Hines Interests Limited Partnership” in its place.

          (g) The definition of “Permitted Transfers” is hereby deleted in its entirety and replaced
with the following:

               “Permitted Transfers:

               (i) a Lease entered into in accordance with the Loan Documents; or

               (ii) a Permitted Encumbrance; or

               (iii) a Transfer and Assumption; or

               (iv) Transfer of Equipment in Borrower’s ordinary course of business (provided that, to the
extent reasonably required for the operation of the Property, such Equipment is replaced with
Equipment of equivalent value and functionality); or

               (v) provided that no Event of Default shall then exist and be continuing, a Transfer of an
interest in Borrower (other than a Transfer of interests in Hines Global REIT Properties LP or in
Hines Global REIT, Inc. (the “REIT”)) to any Person provided that:

10

 

                    (A) such Transfer shall not (x) cause the transferee (other than Key Principal), together with
its Affiliates, to acquire Control of Borrower or to increase its direct or indirect interest in
Borrower to an amount which exceeds 49% or (y) result in Borrower no longer being Controlled by Key
Principal(s);

                    (B) after giving effect to such Transfer, the REIT shall continue to own at least fifty one
percent (51%) of all equity interests (direct or indirect) in Borrower;

                    (C) Reserved;

                    (D) Borrower shall give Lender notice of such Transfer together with copies of all instruments
effecting such Transfer not less than ten (l0) days prior to the date of such Transfer; and

                    (E) the legal and financial structure of Borrower and its members and the single purpose
nature and bankruptcy remoteness of Borrower and its members after such Transfer, shall satisfy
Lender’s then current applicable underwriting criteria and requirements; or

               (vi) provided that no Event of Default shall then exist and be continuing, a Transfer of an
interest in Borrower, which shall cause the transferee to increase its direct or indirect interest
in Borrower to an amount which exceeds 49% or which results in a change of Control of Borrower,
provided that:

                    (A) unless such Transfer is to a Key Principal, such Transfer is first approved by Lender in
its sole and absolute discretion;

                    (B) Borrower, at its sole cost and expense, shall have (1) delivered (or caused to be
delivered) to Lender and, if such Transfer occurs after a Secondary Market Transaction, the
applicable Rating Agencies, a substantive non-consolidation opinion with respect to Borrower in
form and substance satisfactory to Lender and the applicable Rating Agencies and (2) reimbursed
Lender for all reasonable expenses incurred by it in connection with such Transfer; and

                    (C) if such Transfer occurs after a Secondary Market Transaction, Borrower, at its sole cost
and expense, shall have delivered (or caused to be delivered) to Lender and the applicable Rating
Agencies, a Rating Comfort Letter; or

               (vii) a Transfer of any direct or indirect interest in Borrower related to or in connection
with the estate planning of such transferor to (1) an immediate family member of such interest
holder (or to partnerships or limited liability companies Controlled solely by one or more of such
family members) or (2) a trust established for the benefit of such immediate family member (any
such transferee permitted pursuant to this clause (vii) or clause (viii) below, a “Key Principal
Estate Planning Transferee”), provided that:

                    (A) such Transfer shall not result in Borrower no longer being Controlled by a Key Principal
(in the sense of clause (ii) of the defined term “Control”);

11

 

                    (B) such Transfer shall not otherwise result in a change of the day to day management and
operations of the Property;

                    (C) if such Transfer results in the transferee (other than Key Principal (directly or
indirectly)) obtaining Control of Borrower (only in the sense of clause (i) of the defined term
“Control”), Borrower shall give Lender notice of such Transfer not less than ten (10) days prior to
the date of such Transfer; and

                    (D) Borrower shall continue to be a Special Purpose Bankruptcy Remote Entity; or

               (viii) a Transfer of any direct or indirect interest in Borrower that occurs by devise or
bequest or by operation of law upon the death of a natural person that was the holder of such
interest to a member of the immediate family of such interest holder or a trust established for the
benefit of such immediate family member (or to partnerships or limited liability companies
Controlled solely by one or more of such family members), provided that:

                    (A) such Transfer shall not otherwise result in a change of the management and operations of
the Property;

                    (B) if such Transfer results in any transferee (other than (A) Key Principal (directly or
indirectly) or (B) the estate of a remaining Key Principal (during the pendency of the settlement
by the estate of such Key Principal and if such Transfer occurs as a result of the death of such
Key Principal) (a “Key Principal Estate”)), obtaining Control of Borrower, Borrower shall give
Lender notice of such Transfer together with copies of all instruments effecting such Transfer not
less than 10 days after the date of such Transfer;

                    (C) Borrower shall continue to be a Special Purpose Bankruptcy Remote Entity;

                    (D) if (x) any such Transfer would result in Borrower no longer being Controlled (in the sense
of clause (ii) of the defined term “Control”) by at least one of the Key Principals or a Key
Principal Estate and (y) such Transfer occurs prior to the occurrence of a Secondary Market
Transaction, then (1) such Transfer is approved by Lender in writing within 30 days after any such
Transfer, which approval shall not be unreasonably withheld or delayed, and (2) Borrower shall
reimburse Lender for all reasonable expenses incurred by Lender in connection with such Transfer;
and

                    (E) if (x) any such Transfer would result in Borrower no longer being Controlled (in the sense
of clause (ii) of the defined term “Control”) by at least one of the Key Principals or a Key
Principal Estate and (y) such Transfer occurs after the occurrence of a Secondary Market
Transaction, then Borrower, at Borrower’s sole cost and expense, shall, within 90 days after any
such Transfer (or such longer time as may reasonably be necessary for Borrower to obtain the Rating
Comfort Letters required pursuant to this clause (E) (provided Borrower is diligently pursuing
same)) (1) deliver (or cause to be delivered) the applicable Rating Comfort Letters to Lender, (2)
obtain the written consent of Lender which shall not be unreasonably withheld or delayed (provided
that Lender’s approval may be conditioned upon Borrower delivering a Rating Comfort Letter as set
forth in the previous clause (E)(l) and (3)

12

 

reimburse Lender for all reasonable expenses incurred by Lender in connection with such
Transfer; or

               (ix) provided that no Event of Default shall then exist and be continuing:

                    (A) Transfers of interests in Hines Global REIT Properties LP (the “Operating Partnership”)
(other than direct or indirect Transfers of interests in the REIT) as long as the REIT (i) Controls
the Operating Partnership and Borrower and (ii) after giving effect to such transfers, no more than
forty-nine percent (49%) of the outstanding shares or interests in the REIT are held by any Person
(or Affiliated Person) which does not hold at least forty-nine percent (49%) of the outstanding
shares or interests in the REIT as of the date hereof;

                    (B) the issuance of new shares, partnership interests, membership interests or other ownership
interests of any kind in the Operating Partnership as long as the REIT (i) Controls the Operating
Partnership and Borrower and (ii) after giving effect to such issuances, no more than forty-nine
percent (49%) of the outstanding shares or interests in the REIT are held by any Person (or
Affiliated Person) which does not hold at least forty-nine percent (49%) of the outstanding shares
or interests in the REIT as of the date hereof;

                    (C) Transfers of the interests in the REIT as long as (i) the REIT remains a publicly
reporting company and, (ii) after giving effect to such transfers, no more than forty-nine percent
(49%) of the outstanding shares or interests in the REIT are held by any Person (or Affiliated
Person) which does not hold at least forty-nine percent (49%) of the outstanding shares or
interests in the REIT as of the date hereof;

                    (D) the issuance of new shares, partnership interests, membership interests or other ownership
interests of any kind in the REIT as long as (i) the REIT remains a publicly reporting company and,
(ii) after giving effect to such issuance, no more than forty-nine percent (49%) of the outstanding
shares or interests in the REIT are held by any Person (or Affiliated Persons) which does not hold
at least forty-nine percent (49%) of the outstanding shares or interests in the REIT as of the date
hereof;

                    (E) the merger, combination, consolidation, or other reorganization of the Operating
Partnership, provided that (i) the Operating Partnership is the surviving entity, (ii) the
Operating Partnership is Controlled by the REIT following any and all such reorganizations and
(iii) after giving effect to such reorganization, no more than forty-nine percent (49%) of the
outstanding shares or interests in the Operating Partnership are held by any Person (or Affiliated
Person) which does not hold at least forty-nine percent (49%) of the outstanding shares or
interests in the Operating Partnership as of the date hereof; or

                    (F) the merger, combination, consolidation, or other reorganization of the REIT, provided that
(i) the REIT is the surviving entity, (ii) the REIT continues to Control the Operating Partnership
following any and all such reorganization and, (iii) after giving effect to such reorganization, no
more than forty-nine percent (49%) of the outstanding shares or interests in the REIT are held by
any Person (or Affiliated Person) which

13

 

does not hold at least forty-nine percent (49%) of the outstanding shares or interests in the
REIT as of the date hereof.

For purposes of clause (vii), “immediate family member” shall mean a sibling, family trust, parent,
spouse, child (or step-child), grandchild or other lineal descendant of the interest holder.

Notwithstanding anything to the contrary contained in clauses (v), (v), (vi), (vii) or (viii) of
this definition of “Permitted Transfer”, if, as a result of a Permitted Transfer under such
clauses, no direct or indirect interest in Borrower shall continue to be owned by at least one of
the Guarantors, it shall also be a condition hereunder that one or more creditworthy Persons
reasonably satisfactory to Lender that Controls Borrower or owns a direct or indirect interest in
Borrower, shall execute and deliver a guaranty of recourse obligations (in the same form as the
guaranty of recourse obligations delivered to Lender by Guarantors on the date hereof) (A) in the
case of a Permitted Transfer described in clause (v), (vi) or (vii), on or prior to the date of
such Permitted Transfer or (B) in the case of a Permitted Transfer described in clause (viii),
within thirty (30) days after the date of such Permitted Transfer, pursuant to which, in each case,
the replacement guarantor agrees to be liable under such guaranty of recourse obligations
(whereupon the previous guarantor shall be released from any further liability under the guaranty
and from and after the date of such Permitted Transfer, such replacement guarantor shall be the
“Guarantor” for all purposes set forth in this Agreement (it being agreed and understood that the
previous guarantors shall remain the “Guarantor” with respect to any and all obligations accruing
prior to the date of such Permitted Transfer)).

Notwithstanding anything in this definition of “Permitted Transfer” to the contrary, in order for a
Transfer to be deemed a Permitted Transfer, in addition to satisfying the applicable conditions set
forth above, after giving effect to such Transfer, Hines Global REIT Properties LP must also
continue to own at least fifty-one percent (51%) of all equity interests in Borrower.

It is acknowledged and agreed that Transfers of interests in the REIT occurring in the ordinary
course and otherwise in accordance with the provisions of Sections (v) and/or (ix) of this
definition of Permitted Transfers shall not, without more, be deemed Springing Recourse Events,
notwithstanding anything in clause (1) of the last sentence of Section 10.1 to the contrary and
notwithstanding that an Event of Default was continuing at the time of such Transfer.”

          (h) Section 5.12.1 of the Loan Agreement is hereby amended by deleting clause (f) in its
entirety and substituting the following in its place “(f) suffer or permit the ownership,
management or control of the Manager to be transferred to a Person other than an affiliate of
Borrower or Hines Interests Limited Partnership.”

          (i) Section 5.14 of the Loan Agreement is hereby amended by deleting the words “the date
hereof” from the third line thereof and inserting “September [        ], 2010” in its place. Section
5.14 of the Loan Agreement is further amended by inserting the words “assumption of the” between
the words “connection with the” and “Loan” in the fourth line thereof.

          (j) Lender shall waive the requirement for audited annual financial statements for Borrower
pursuant to Section 6.3.2 of the Loan Agreement and shall instead accept (i) annual

14

 

financial statements from Borrower certified by an officer of Borrower and (ii) audited annual
financial statements of Hines Global REIT, Inc.

          (k) Section 6.3.3 is amended so that Borrower must deliver to Lender the items required under
Section 6.3.3 within twenty (20) days after the end of each non-quarter-end calendar month or
within thirty (30) days after the end of each calendar quarter.

          (l) Section 10.1(a) is hereby amended by adding the words “or any assumption thereof” at the
end of such section.

     10. Interest Accrual Rate and Monthly Installment Payment Amount to Remain the Same.
The interest rate and the monthly payments set forth in the Note shall remain unchanged. Prior to
the occurrence of an Event of Default hereunder or under the Note, interest shall accrue on the
principal balance outstanding from time to time at the applicable interest rate as set forth in the
Note and principal and interest (which does not include such amounts as may be required to fund
escrow obligations under the terms of the Loan Documents) shall continue to be paid in accordance
with the provisions of the Note.

     11. Conditions. This Agreement shall be of no force and effect until each of the
following conditions has been met to the complete satisfaction of Lender:

          (a) Fees and Expenses. Original Borrower and/or Assuming Borrower shall pay, or cause
to be paid at closing: (i) all costs and expenses incident to the preparation, execution and
recordation hereof and the consummation of the transaction contemplated hereby, including, but not
limited to, recording fees, filing fees, surveyor fees, broker fees, transfer or mortgage taxes,
rating agency confirmation fees, application fees, underwriting fees, all third party fees, search
fees, transfer fees, inspection fees, title insurance policy or endorsement premiums or other
charges of any title company and escrow agent, and the fees and expenses of legal counsel to any
Lender Party and any applicable rating agency and (ii) an assumption fee to Lender in the amount of
$400,000.00 (being one half of one percent (0.50%) of the outstanding principal balance of the Note
as of the date of the transfer and assumption contemplated by this Agreement), the next regularly
scheduled monthly payment due under the Loan and the other fees and expenses outlined in the
beneficiary statement distributed to the parties by Lender. As between Original Borrower and
Assuming Borrower only (it being acknowledged and agreed that Lender shall have the rights to
require Original Borrower and/or Assuming Borrower to pay such sum), the foregoing provisions of
this Section (a) shall not be deemed to modify the allocation of costs between Original Borrower
and Assuming Borrower pursuant to the Sales Agreement.

          (b) Other Conditions. Satisfaction of all requirements under the Loan Documents and
the closing checklist for this transaction as determined by Lender and Lender’s counsel in their
sole discretion.

     12. Default.

          (a) Breach. Any breach of Assuming Obligors or Original Obligors of any of their
respective representations, warranties and covenants contained herein shall constitute a default
under the Mortgage and each other Loan Document.

15

 

          (b) Failure to Comply. Any failure of Assuming Obligors or Original Obligors to
fulfill any one of the conditions set forth in this Agreement shall constitute a default under this
Agreement and the Loan Documents.

          (c) Certain Loan Document Defaults. Notwithstanding anything herein or in the other
Loan Documents to the contrary, Assuming Obligors shall not have any duty to cure any breach by the
Original Obligors of any representation, warranty or covenant set forth in the organizational
documents of any one or more of the Original Obligors, and any such breach shall not, in and of
itself, constitute a default hereunder or under the other Loan Documents.

     13. No Further Consents. Assuming Obligors and Original Obligors acknowledge and
agree that Lender’s consent herein contained is expressly limited to the sale, conveyance,
assignment and transfer herein described, that such consent shall not waive or render unnecessary
Lender’s consent or approval of any subsequent sale, conveyance, assignment or transfer of the
Property, and that Section 5.26 of the Loan Agreement shall continue in full force and effect.

     14. Additional Representations, Warranties and Covenants of Assuming Obligors.
As a condition of this Agreement, Assuming Obligors represent and warrant to Lender as follows:

          (a) Assuming Borrower is a limited liability company duly organized, validly existing and in
good standing under the laws of the State of Delaware and is qualified to do business and in good
standing in the State of North Carolina. Assuming Borrower has full power and authority to enter
into and carry out the terms of this Agreement and to assume and carry out the terms of the Loan
Documents.

          (b) Assuming Indemnitor is a limited partnership duly organized and validly existing in good
standing under the laws of the State of Delaware and is authorized to transact business as a
foreign corporation in each jurisdiction in which such authorization is necessary for the operation
of the business or properties of Assuming Borrower. Assuming Indemnitor is, and shall remain, the
sole member of Assuming Borrower subject to any Permitted Transfers. Assuming Indemnitor has full
power and authority to execute and deliver, and carry out the terms of, this Agreement and to
assume and carry out the terms of the applicable Loan Documents.

          (c) Hines Global REIT Inc. is a corporation duly organized and validly existing in good
standing under the laws of the State of Maryland and is authorized to transact business as a
foreign corporation in each jurisdiction in which such authorization is necessary for the operation
of the business or properties of Hines Global REIT Inc.. Hines Global REIT Inc. is, and, subject to
Permitted Transfers, shall remain, the sole general partner of Assuming Indemnitor and has full
power and authority to execute and deliver, and carry out the terms of, this Agreement as general
partner on behalf of Assuming Indemnitor.

          (d) This Agreement and the Loan Documents constitute legal, valid and binding obligations of
Assuming Obligors enforceable in accordance with their respective terms. Neither the entry into
nor the assumption and performance of and compliance with this

16

 

Agreement or any of the Loan Documents has resulted or will result in any material violation
of, or a material conflict with or a default under, any judgment, decree, order, mortgage,
indenture, contract, agreement or lease by which Assuming Obligors or any property of Assuming
Obligors are bound or any statute, rule or regulation applicable to Assuming Obligors.

          (e) There is no action, proceeding or investigation pending or threatened which questions,
directly or indirectly, the validity or enforceability of this Agreement or any of the other Loan
Documents, or any action taken or to be taken pursuant hereto or thereto, or which might result in
any material adverse change in the condition (financial or otherwise) or business of either or both
of Assuming Obligors.

          (f) There has been no legislative action, regulatory change, revocation of license or right to
do business, fire, explosion, flood, drought, windstorm, earthquake, accident, other casualty or
act of God, labor trouble, riot, civil commotion, condemnation or other action or event which has
had any material adverse effect, on the business or condition (financial or otherwise) of either or
both of Assuming Obligors or any of their properties or assets, whether insured against or not,
since Assuming Obligors submitted to Lender their request to assume the Loan.

          (g) The financial statements and other data and information supplied by Assuming Obligors in
connection with Assuming Borrower’s request to assume the Loan or otherwise supplied in
contemplation of the assumption of the Loan by Assuming Obligors are correct and sufficiently
complete to give Lender accurate knowledge of their subject matter, were in all material respects
true and correct on the dates they were supplied, and since their dates no material adverse change
in the financial condition of Assuming Obligors has occurred, and there is not any pending or
threatened litigation or proceedings which might impair to a material extent the business or
financial condition of Assuming Obligors.

          (h) Without limiting the generality of the assumption of the Loan Documents by Assuming
Obligors, Assuming Obligors hereby specifically remake and reaffirm the representations, warranties
and covenants set forth in the Loan Documents to which they are a party, as such representations,
warranties and covenants are modified by this Agreement and except as such representations relate
to characteristics of Original Borrower or Original Indemnitor or as were disclosed to Lender in
that certain side letter from Assuming Obligors to Lender delivered to Lender on, and dated as of,
the date hereof.

          (i) No representation or warranty of Assuming Obligors made in this Agreement contains any
untrue statement of material fact or omits to state a material fact necessary in order to make such
representations and warranties not misleading in light of the circumstances under which they are
made.

          (j) Assuming Borrower hereby represents and warrants to Lender that Assuming Borrower will not
permit the transfer of any interest in Assuming Borrower to any person or entity (or any beneficial
owner of such entity) who is listed on the specifically Designated Nationals and Blocked Persons
List maintained by the Office of Foreign Asset Control, Department of the Treasury pursuant to
Executive Order No. 13224, 66 Fed. Reg. 49079 (Sept. 25, 2001) and/or any other list of terrorists
or terrorist organizations

17

 

maintained pursuant to any of the rules and regulations of Office of Foreign Asset Control, Department of
the Treasury or pursuant to any other applicable Executive Orders (such lists are collectively
referred to as the “OFAC Lists”), it being acknowledged and agreed that such covenant shall be
deemed satisfied solely with respect to holders of publicly traded direct or indirect interests in
Assuming Borrower so long as Assuming Borrower does not knowingly permit the transfer of any
interest in Assuming Borrower to any person or entity (or any beneficial owner of such entity) who
is listed on any OFAC list and otherwise does not violate any applicable law with respect thereto
and diligently uses commercially reasonable efforts to prevent the transfer of any such interests
to any such person or entity. Assuming Borrower will not knowingly enter into a lease with any
party who is listed on the OFAC Lists. Assuming Borrower shall immediately notify Lender if
Assuming Borrower has knowledge that any member or beneficial owner of Assuming Borrower is listed
on the OFAC Lists or (A) is indicted on or (B) arraigned and held over on charges involving money
laundering or predicate crimes to money laundering. Assuming Borrower shall immediately notify
Lender if Assuming Borrower knows that any tenant is listed on the OFAC Lists or (A) is convicted
on, (B) pleads nolo contendere to, (C) is indicted on or (D) is arraigned and held over on charges
involving money laundering or predicate crimes to money laundering. Assuming Borrower further
represents and warrants to Lender that Assuming Borrower is currently not on the OFAC List. None
of the Assuming Borrower, any subsidiary of the Assuming Borrower or any affiliate of the Assuming
Borrower or Assuming Indemnitor is (i) named on the list of Specially Designated Nationals or
Blocked Persons maintained by the U.S. Department of the Treasury’s Office of Foreign Assets
Control available at http://www.treas.gov/offices/eotffc/ofac/sdn/index.html, or (ii) (A)
an agency of the government of a country, (B) an organization controlled by a country, or (C) a
person residing in a country that is subject to a sanctions program identified on the list
maintained by the U.S. Department of the Treasury’s Office of Foreign Assets Control and available
at http://www.treas.gov/offices/eotffc/ofac/sanctions/index.html, or as otherwise published
from time to time, as such program may be applicable to such agency, organization or person, it
being acknowledged and agreed that such representation is only to Assuming Borrower’s knowledge
solely with respect to holders of publicly traded direct or indirect interests in Assuming Borrower
and/or Assuming Indemnitor.

          (k) No consent to the transfer of the Property to Assuming Borrower is required under any
agreement, including, without limitation, under any lease, operating agreement, mortgage or
security instrument (other than the Loan Documents), or if such consent is required, Assuming
Borrower has obtained all such consents.

          (l) Assuming Borrower represents and warrants that its chief executive office (or principal
residence, if applicable) is located at the address shown on page one of this Agreement. All
organizational documents of Assuming Borrower delivered to Lender are complete and accurate in
every respect. Assuming Borrower’s legal name is exactly as shown on page one of this Agreement.
Assuming Borrower covenants not to change Assuming Borrower’s name or, as applicable, Assuming
Borrower’s chief executive office, Assuming Borrower’s principal residence or the jurisdiction in
which Assuming Borrower is organized, without giving Lender at least 30 days’ prior written notice.

          (m) The fair market value of the interests in real property (within the meaning of sections
1.860G-2(a)(4) and 1.860G-2(b)(7) of the Income Tax Regulations promulgated

18

 

under the Internal Revenue Code of 1986, as amended) that secure the Loan immediately after
the closing under the Sales Agreement and this Agreement equals or exceeds the fair market value of
the interests in real property (within the meaning of sections 1.860G-2(a)(4) and 1.860G-2(b)(7) of
the Income Tax Regulations promulgated under the Internal Revenue Code of 1986, as amended) that
secured the Loan immediately before the closing under the Sales Agreement and this Agreement..

     15. Additional Representations, Warranties and Covenants of Original Obligors. As a
condition of this Agreement, Original Obligors represent and warrant to Lender as follows:

          (a) Original Borrower is a limited liability company duly organized, validly existing and in
good standing under the laws of the State of Delaware and is qualified to do business and in good
standing in the State of North Carolina. Original Borrower has full power and authority to execute
and deliver, and carry out the terms of, this Agreement and to convey the Property and assign the
Loan Documents.

          (b) No consent to the transfer of the Property to Assuming Borrower is required under any
agreement, including, without limitation, under any lease, operating agreement, mortgage or
security instrument (other than the Loan Documents), or if such consent is required, Assuming
Obligors have obtained all such consents.

          (c) Each Original Indemnitor is a resident of the State of New York and is legally competent
to execute this Agreement.

          (d) This Agreement, the Sales Agreement and all other documents executed by Original Obligors
in connection therewith, constitute legal, valid and binding obligations of Original Obligors
enforceable in accordance with their respective terms. Neither the entry into nor the performance
of and compliance with this Agreement, the Sales Agreement and all other documents executed by
Original Obligors in connection therewith has resulted or will result in any violation of, or a
conflict with or a default under, any judgment, decree, order, mortgage, indenture, contract,
agreement or lease by which Original Obligors or any property of Original Obligors are bound or any
statute, rule or regulation applicable to Original Obligors.

          (e) Original Obligors have not received any written notices from any governmental entity
claiming that either the Property or Original Obligors’ use of the Property is not presently in
compliance with any laws, ordinances, rules, and regulations bearing upon the use and operation of
the Property, including, without limitation, any notice relating to zoning laws or building code
regulations.

          (f) The certified rent roll provided to Lender of even date herewith, is a true, complete and
accurate summary of all tenant leases (“Tenant Leases” or individually, a “Tenant Lease”) affecting
the Property as of the date of this Agreement. No rent has been prepaid under any Tenant Lease
except rent for the current month. Each Tenant Lease has been duly executed and delivered by, and,
to the knowledge of Original Obligors, is a binding obligation of, the respective tenant, and each
Tenant Lease is in full force and effect. Each Tenant Lease represents the entire agreement
between the Original Borrower and the respective tenant and no Tenant Lease has been terminated,
renewed, amended, modified or otherwise changed without

19

 

the prior written consent of Lender to the extent required by the Loan Documents. The tenant
under each Tenant Lease has taken possession of and is in occupancy of the premises therein
described and is open for business. Rent payments have commenced under each Tenant Lease, and all
tenant improvements in such premises and other conditions to occupancy and/or rent commencement
have been completed by Original Borrower or its predecessor in interest. All obligations of the
landlord under the Tenant Leases have been performed, and no event has occurred and no condition
exists that, with the giving of notice or lapse of time or both, would constitute a default by
Original Borrower under any Tenant Lease. There are no offsets or defenses that any tenant has
against the full enforcement of any Tenant Lease by the Original Borrower. Each Tenant Lease is
fully and freely assignable by the Original Borrower without notice to or the consent of the tenant
thereunder.

          (g) Immediately prior to the Assumption, Original Borrower is the current owner of the
Property. There are no pending or threatened suits, judgments, arbitration proceeding,
administrative claims, executions or other legal or equitable actions or proceedings against
Original Obligors or the Property, any pending or threatened condemnation or annexation proceedings
affecting the Property, any agreements to convey any portion of the Property, or any rights
thereto, that are not disclosed in this Agreement, including, without limitation, any pending or
threatened administrative claim by any governmental agency.

          (h) The fair market value of the interests in real property (within the meaning of sections
1.860G-2(a)(4) and 1.860G-2(b)(7) of the Income Tax Regulations promulgated under the Internal
Revenue Code of 1986, as amended) that secure the Loan immediately after the closing under the
Sales Agreement and this Agreement equals or exceeds the fair market value of the interests in real
property (within the meaning of sections 1.860G-2(a)(4) and 1.860G-2(b)(7) of the Income Tax
Regulations promulgated under the Internal Revenue Code of 1986, as amended) that secured the Loan
immediately before the closing under the Sales Agreement and this Agreement.

          (i) No representation or warranty of Original Obligors made in this Agreement contains any
untrue statement of material fact or omits to state a material fact necessary in order to make such
representations and warranties not misleading in light of the circumstances under which they are
made.

     16. Incorporation of Recitals. Each of the Recitals set forth above in this Agreement
are incorporated herein and made a part hereof.

     17. Property Remains as Security for Lender. All of the Property shall remain in all
respects subject to the lien, charge or encumbrance of the Mortgage. Except as expressly set forth
in this Agreement, nothing contained herein shall affect or be construed to release or affect the
liability of any party or parties who may now or hereafter be liable under or on account of the
Note or the Mortgage, nor shall anything contained herein affect or be construed to affect any
other security for the Note held by Lender. Nothing in this Agreement shall in any way release,
diminish or affect the lien position of the Mortgage or any liens created by, or the agreements or
covenants contained in the Loan Documents or the lien priority of any such liens.

20

 

     18. No Waiver by Lender. Nothing contained herein shall be deemed a waiver of any of
Lender’s rights or remedies under any of the Loan Documents, or under applicable law.

     19. References. From and after the date hereof: (a) references in any of the Loan
Documents to any of the other Loan Documents will be deemed to be references to such other Loan
Documents as modified by this Agreement; (b) references in the Loan Documents to “Borrower,”
“Grantor,” “Assignor,” “Maker” or “Mortgagor” shall hereafter be deemed to refer to Assuming
Borrower; (c) references in the Loan Documents to the “Guarantor,” “Indemnitor” or “Key Principal”
shall hereafter be deemed to refer to Assuming Indemnitor; and (d) all references to the term “Loan
Documents” or “Security Documents” in the Loan Documents shall hereinafter refer to the Loan
Documents as defined herein, this Agreement, and all documents executed in connection with this
Agreement.

     20. Relationship with Loan Documents. To the extent that this Agreement is
inconsistent with the Loan Documents, this Agreement will control and the Loan Documents will be
deemed amended by this Agreement. Except as explicitly amended hereby, the Loan Documents shall
remain unchanged and in full force and effect.

     21. Titles and Captions. Titles and captions of sections and subsections of this
Agreement have been inserted for convenience only, and neither limit nor amplify the provisions of
this Agreement.

     22. Partial Invalidity. Any provision of this Agreement or the Loan Documents held to
be illegal, invalid or unenforceable in any jurisdiction, shall, as to such jurisdiction, be
ineffective only to the extent of such illegality, invalidity or unenforceability, without
invalidating the remainder of such provision or the remaining provision hereof or thereof or
affecting the legality, validity or enforceability of such provision in any other jurisdiction.

     23. Entire Agreement. This Agreement and the documents contemplated to be executed
herewith constitute the entire agreement among the parties hereto with respect to the assumption of
the Loan. This Agreement supersedes all prior negotiations regarding the transfer of the Property
and the Assumption. This Agreement and the Loan Documents may only be amended, revised, waived,
discharged, released or terminated by a written instrument executed by the party against which
enforcement of the amendment, revision, waiver, discharge, release or termination is asserted. Any
alleged amendment, revision, waiver, discharge, release or termination of this Agreement which is
not in writing and signed by the parties shall not be effective as to any party.

     24. Binding Effect. This Agreement and the documents contemplated to be executed in
connection herewith shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns; provided, however, that the foregoing provision shall not be a
consent by Lender to any further sale, conveyance, assignment or transfer of the Property by
Assuming Borrower.

     25. Multiple Counterparts. This Agreement may be executed in multiple counterparts,
each of which when so executed shall be deemed an original and shall be binding upon all parties
and all of which, taken together, shall constitute one and the same Agreement.

21

 

     26. Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State where the Property is located.

     27. Effective Date. This Agreement shall be effective as of the date of its execution
by the parties hereto and upon such date this Agreement shall be incorporated into the terms of the
Loan Documents.

     28. Time of Essence. Time is of the essence with respect to all provisions of this
Agreement.

     29. Cumulative Remedies. All remedies contained in this Agreement are cumulative and
Lender shall also have all other remedies provided at law and in equity contained in the Mortgage
and other Loan Documents. Such remedies may be pursued separately, successively or concurrently at
the sole discretion of Lender and may be exercised in any order and as often as occasion therefor
shall arise.

     30. Construction. Each party hereto acknowledges that it has participated in the
negotiation of this Agreement and that no provision shall be construed against or interpreted to
the disadvantage of any party. Assuming Obligors and Original Obligors have had sufficient time to
review this Agreement, have been represented by legal counsel at all times, have entered into this
Agreement voluntarily and without fraud, duress, undue influence or coercion of any kind. Lender
has not made a representation or warranty to any party except as set forth in this Agreement.

     31. WAIVER OF JURY TRIAL. ORIGINAL OBLIGORS, ASSUMING OBLIGORS AND LENDER, TO THE
FULL EXTENT PERMITTED BY LAW, HEREBY KNOWINGLY, INTENTIONALLY AND VOLUNTARILY, WITH AND UPON THE
ADVICE OF COMPETENT COUNSEL, WAIVE, RELINQUISH AND FOREVER FORGO THE RIGHT TO A TRIAL BY JURY IN
ANY ACTION OR PROCEEDING BASED UPON, ARISING OUT OF, OR IN ANY WAY RELATING TO THE LOAN DOCUMENTS
OR THIS AGREEMENT.

     32. Initialed Provisions. Any terms in the Mortgage or in any of the other Loan
Documents that make provisions for the initials of the borrower or any indemnitor or guarantor in
respect of the Loan shall be deemed to have been initialed by the applicable Assuming Obligor.

     33. Exculpation. The liability of Assuming Borrower under this Agreement and the
other Loan Documents shall be limited as and to the extent set forth in Section 10.1 of the Loan
Agreement. The liability of Assuming Indemnitor under this Agreement and the other Loan Documents
shall be limited as set forth in the Indemnity Agreement and the other Loan Documents to which
Original Indemnitor is a party (as such documents are amended by this Agreement).

     34. Attorneys’ Fees; Enforcement. If any attorney is engaged by Lender to enforce,
construe or defend any provision of this Agreement, or as a consequence of any default under or
breach of this Agreement, with or without the filing of any legal action or proceeding, Assuming
Borrower shall pay to Lender, upon demand, the amount of all attorneys’ fees and costs

22

 

reasonably incurred by Lender in connection therewith, together with interest thereon from the
date of such demand at the rate of interest applicable to the principal balance of the Note as
specified therein.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

23

 

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement to be effective as of the
date first aforesaid.

	 	 	 

	ASSUMING 
BORROWER:

	 	HINES GLOBAL REIT HOCK PLAZA I LLC,
	 

	 	
a Delaware limited liability company

	 	 	 	 	 
	 	 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

	 	 	 

	ASSUMING 
INDEMNITOR:
	 	 
	 

	 	HINES GLOBAL REIT PROPERTIES LP,
	 

	 	a Delaware limited partnership
	 
	 	 
	 

	 	By: Hines Global REIT, Inc., its general partner

	 	 	 	 	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

24

 

STATE OF                                         

COUNTY OF                                         

     I certify that the following person(s) personally appeared before me this day, each
acknowledging to me that he or she voluntarily signed the foregoing document for the purpose stated
therein and in the capacity indicated:                                          (insert name only (not title) of
individual signing document).

	 	 	 	 	 

	Date:                                         
	 	 	 	 
	 

	 	 

Official Signature of notary
	 	 
	 
	 	 	 	 
	My Commission Expires:
	 	 	 	 
	 

	 	 

Notary’s printed or typed name, Notary Public
	 	 
	                                        

	 	 	 	 
	(Official Seal)
	 	 	 	 

STATE OF                                         

COUNTY OF                                         

     I certify that the following person(s) personally appeared before me this day, each
acknowledging to me that he or she voluntarily signed the foregoing document for the purpose stated
therein and in the capacity indicated:                                          (insert name only (not title) of
individual signing document).

	 	 	 	 	 

	Date:                                         
	 	 	 	 
	 

	 	 

Official Signature of notary
	 	 
	 
	 	 	 	 
	My Commission Expires:
	 	 	 	 
	 

	 	 

Notary’s printed or typed name, Notary Public
	 	 
	                                        

	 	 	 	 
	(Official Seal)
	 	 	 	 

25

 

	 	 	 

	ORIGINAL 
BORROWER:

	 	BRICKMAN DURHAM LLC,
a Delaware limited liability company

	 	 	 	 	 
	 	By:  	 	 
	 	 	Name:  	 
	 	 	Title:  	Manager 	 
	 

	 	 	 	 	 

	ORIGINAL 
INDEMNITOR:
	 	 	 	 
	 

	 	 

Name: BRUCE S. BRICKMAN, an individual
	 	 
	 
	 	 	 	 
	 

	 	 

Name: KATHLEEN CORTON, an individual
	 	 
	 
	 	 	 	 
	 

	 	 

Name: RODERICK O’CONNOR, an individual
	 	 

STATE OF                                         

COUNTY OF                                         

     I certify that the following person(s) personally appeared before me this day, each
acknowledging to me that he or she voluntarily signed the foregoing document for the purpose stated
therein and in the capacity indicated:                                          (insert name only (not title) of
individual signing document).

	 	 	 	 	 

	Date:                                         
	 	 	 	 
	 

	 	 

Official Signature of notary
	 	 
	 
	 	 	 	 
	My Commission Expires:
	 	 	 	 
	 

	 	 

Notary’s printed or typed name, Notary Public
	 	 
	                                        

	 	 	 	 
	(Official Seal)
	 	 	 	 

26

 

STATE OF                                         

COUNTY OF                                         

     I certify that the following person(s) personally appeared before me this day, each
acknowledging to me that he or she voluntarily signed the foregoing document for the purpose stated
therein and in the capacity indicated:                                          (insert name only (not title) of
individual signing document).

	 	 	 	 	 

	Date:                                         
	 	 	 	 
	 

	 	 

Official Signature of notary
	 	 
	 
	 	 	 	 
	My Commission Expires:
	 	 	 	 
	 

	 	 

Notary’s printed or typed name, Notary Public
	 	 
	                                        

	 	 	 	 
	(Official Seal)
	 	 	 	 

STATE OF                                         

COUNTY OF                                         

     I certify that the following person(s) personally appeared before me this day, each
acknowledging to me that he or she voluntarily signed the foregoing document for the purpose stated
therein and in the capacity indicated:                                          (insert name only (not title) of
individual signing document).

	 	 	 	 	 

	Date:                                         
	 	 	 	 
	 

	 	 

Official Signature of notary
	 	 
	 
	 	 	 	 
	My Commission Expires:
	 	 	 	 
	 

	 	 

Notary’s printed or typed name, Notary Public
	 	 
	                                        

	 	 	 	 
	(Official Seal)
	 	 	 	 

27

 

STATE OF                                         

COUNTY OF                                         

     I certify that the following person(s) personally appeared before me this day, each
acknowledging to me that he or she voluntarily signed the foregoing document for the purpose stated
therein and in the capacity indicated:                                          (insert name only (not title) of
individual signing document).

	 	 	 	 	 

	Date:                                         
	 	 	 	 
	 

	 	 

Official Signature of notary
	 	 
	 
	 	 	 	 
	My Commission Expires:
	 	 	 	 
	 

	 	 

Notary’s printed or typed name, Notary Public
	 	 
	                                        

	 	 	 	 
	(Official Seal)
	 	 	 	 

28

 

	 	 	 	 	 	 	 

	LENDER:	 	BANK OF AMERICA, N.A., as trustee for the registered holders of GS
Mortgage Securities Corporation II, Commercial Mortgage
Pass-Through Certificates, Series 2006-GG6
	 
	 	 	 	 	 	 
	 	 	By:	 	WELLS FARGO BANK, N.A., as successor by merger to WACHOVIA
BANK, NATIONAL ASSOCIATION, solely in its capacity as Servicer, as
authorized under that certain Pooling and Servicing Agreement
dated as of March 1, 2006
	 
	 	 	 	 	 	 
	 

	 	 	 	                                                            	 	 
	 

	 	 	 	By:                                                             	 	 
	 

	 	 	 	Name:                                                    	 	 
	 

	 	 	 	Title:                                                    	 	 

STATE OF                                         

COUNTY OF                                         

     I certify that the following person(s) personally appeared before me this day, each
acknowledging to me that he or she voluntarily signed the foregoing document for the purpose stated
therein and in the capacity indicated:                                          (insert name only (not title) of
individual signing document).

	 	 	 	 	 

	Date:                                         
	 	 	 	 
	 

	 	 

Official Signature of notary
	 	 
	 
	 	 	 	 
	My Commission Expires:
	 	 	 	 
	 

	 	 

Notary’s printed or typed name, Notary Public
	 	 
	                                        

	 	 	 	 
	(Official Seal)
	 	 	 	 

29

 

EXHIBIT A

[TITLE COMPANY TO ATTACH EXHIBIT A LEGAL

DESCRIPTION OF THE PROPERTY]

30

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