Contract analysis

I. Executive Summary This memorandum provides the deal team with a comprehensive internal briefing on the proposed $500,000,000 asset-backed securities issuance to be undertaken by our client, Quorum Insurance Holdings Corp. ("QIH"). Calderwood & Harkness LLP ("C&H") was formally engaged on June 28, 2022 as issuer's counsel to QIH in connection with this transaction. The purpose of this memorandum is to brief the C&H

II. Client Overview A. Quorum Insurance Holdings Corp. (Sponsor / Parent) Quorum Insurance Holdings Corp. ("QIH") is a Delaware corporation and the ultimate parent entity and sponsor of the securitization transaction. QIH is publicly traded on the New York Stock Exchange under the ticker symbol QIHC. Its principal executive offices are located at 400 Atlantic Street, Suite 2200, Stamford, Connecticut 06901. QIH's emp

III. Transaction Structure A. Structural Overview The transaction will employ a two-tier SPV structure with an intermediate depositor entity, which is the standard market structure for insurance premium finance ABS and is designed to achieve both bankruptcy remoteness for the issuer and true sale treatment for the transfers of receivables at each level of the structure. The two-tier structure is important because it

1. Sale of Receivables — QPF to QRH. QPF (as Originator and Seller) will sell eligible insurance premium finance receivables to Quorum Receivables Holding LLC ("QRH"), a newly formed Delaware limited liability company organized as a bankruptcy-remote intermediate SPV and depositor. This sale will be effected pursuant to a Receivables Sale Agreement, which will be structured to constitute a true sale of the receivable

2. Transfer of Receivables — QRH to QRF 2022-1. QRH (as Depositor) will transfer and contribute the receivables to QRF 2022-1 (the Issuer) pursuant to a Receivables Transfer Agreement. This second transfer will also be structured to support true sale characterization, although the analysis at this level is somewhat different given that QRH is the sole member of QRF 2022-1 and the transfer may include elements of a ca

3. Note Issuance by QRF 2022-1. QRF 2022-1 (as Issuer) will issue the Class A Notes, Class B Notes, and Class C Notes to investors pursuant to an Indenture between QRF 2022-1 and Calvoneth Trust Company, N.A. ("Calvoneth Trust"), as indenture trustee. The notes will be secured by a first-priority perfected security interest in the receivables pool and all related collections, accounts, and other assets of QRF 2022-1

IV. Capital Structure A. Tranche Summary The notes will be issued in three rated tranches, plus an unrated overcollateralization/retained interest position, as summarized in the table below: All classes of notes will bear interest at a floating rate equal to the Secured Overnight Financing Rate ("SOFR") plus the applicable spread indicated in the coupon guidance column above. The interest rate will be compounded dail

V. Receivables Pool Characteristics (as of Anticipated Cut-Off Date: June 30, 2022) The following summary presents the key characteristics of the receivables pool as of the anticipated cut-off date of June 30, 2022. The data below is based on preliminary pool information provided by QPF's treasury team and has not yet been independently verified by Veristead Analytics LLC ("Veristead"), which has been engaged as the

VI. Key Structural Features A. Eligible Receivables Criteria The eligible receivables criteria define the characteristics that a receivable must satisfy in order to be included in the initial pool or to be purchased during the revolving period as a replacement receivable. These criteria serve as the primary quality filter for the collateral pool and are negotiated among the issuer, the rating agencies, and the underw

1. Payment of fees and expenses of the indenture trustee (Calvoneth Trust), including the trustee fee and any outstanding indemnification obligations;

2. Payment of the servicing fee to QPF (as Servicer), equal to 1.00% per annum on the outstanding pool balance;

3. Payment of accrued and unpaid interest on the Class A Notes;

4. Payment of accrued and unpaid interest on the Class B Notes;

5. Payment of accrued and unpaid interest on the Class C Notes;

6. Payment of principal on the Class A Notes (during the amortization period or following an early amortization event), until the Class A Notes are paid in full;

7. Payment of principal on the Class B Notes, until the Class B Notes are paid in full;

8. Payment of principal on the Class C Notes, until the Class C Notes are paid in full;

9. Replenishment of the overcollateralization amount to its target level of $15,000,000 (to the extent that losses have reduced the OC amount below target);

10. Any residual amounts to the Issuer (and, ultimately, distributed or retained by the sponsor). During the revolving period, collections that would otherwise be applied to principal payments under steps 6 through 8 will instead be used to purchase additional eligible receivables from QPF, subject to compliance with the eligible receivables criteria and concentration limits. The sequential waterfall structure ensure

VII. Transaction Parties and Their Roles A. Ridgeline Capital Markets LLC — Structuring Agent / Lead Bookrunner / Sole Placement Agent Ridgeline Capital Markets LLC ("Ridgeline") is a broker-dealer registered with the Securities and Exchange Commission and a member of the Financial Industry Regulatory Authority. Ridgeline's principal offices are located at 383 Madison Avenue, 14th Floor, New York, New York 10179. Rid

VIII. Key Financial Terms Summary The following table consolidates the principal financial terms and transaction costs for quick reference: The servicing fee of 1.00% per annum is payable monthly and is calculated on the outstanding pool balance as of the immediately preceding determination date. At the initial pool balance of $612,000,000, this equates to approximately $6,120,000 per annum, or approximately $510,000

IX. Key Workstreams for Calderwood & Harkness This section outlines the principal workstreams for the C&H deal team, organized chronologically by transaction phase. Each workstream is assigned to one or more team members as indicated in the team assignments table in Section XI below. The workstreams are designed to track the anticipated timeline set forth in Section X and to ensure that all deliverables are completed