REVISED INDICATIVE TERM SHEET (VERSION 2)

REVISED INDICATIVE TERM SHEET (VERSION 2)
$500,000,000 Asset-Backed Notes
Quorum Receivables Funding 2022-1 LLC
Insurance Premium Finance Receivables
August 15, 2022
CONFIDENTIAL — For Discussion Purposes Only. This term sheet does not constitute an offer to sell or a solicitation of an offer to buy any securities. Terms are indicative and subject to change. Distribution of this term sheet is restricted to the parties identified herein and their authorized representatives. Any reproduction, dissemination, or distribution of this term sheet, in whole or in part, to any person other than the intended recipients without the prior written consent of Ridgeline Capital Markets LLC and Calderwood & Harkness LLP is strictly prohibited.
Distribution List:
•  Quorum Insurance Holdings Corp.
•  Quorum Premium Finance LLC
•  Ridgeline Capital Markets LLC
•  Calderwood & Harkness LLP
•  Calloway & Brandt LLP
•  Brindoval Ratings Inc.
•  Pinnacle Rating Services LLC
Version History and Rating Agency Feedback:
This Revised Indicative Term Sheet (Version 2) supersedes in its entirety Version 1, dated July 18, 2022. Version 2 has been prepared to incorporate feedback received from the following rating agencies:
•  Brindoval Ratings Inc. — Meeting held August 8, 2022; preliminary ratings issued August 22, 2022; Engagement No. CR-SF-2022-08812. Changes responsive to Brindoval feedback are identified throughout this term sheet.
•  Pinnacle Rating Services LLC — Meeting held August 8, 2022; preliminary ratings pending at the time of circulation of this Version 2; Engagement No. PRS-2022-ABS-3347. Changes responsive to Pinnacle feedback are identified throughout this term sheet.
Reference Numbers:
•  Calderwood & Harkness LLP Matter No. 1025-00007
•  Ridgeline Capital Markets LLC Deal ID: RCM-IPF-2022-0041
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Section 1: Transaction Summary
The following is a summary of the principal terms and parties for the proposed issuance of $500,000,000 in aggregate principal amount of asset-backed notes by Quorum Receivables Funding 2022-1 LLC, backed by a portfolio of insurance premium finance receivables originated by Quorum Premium Finance LLC.
Transaction Type: Asset-backed securities issuance collateralized by insurance premium finance receivables originated by Quorum Premium Finance LLC in the ordinary course of its insurance premium finance lending business.
Offering Type: Private placement exempt from registration under the Securities Act of 1933, as amended (the "Securities Act"), pursuant to Rule 144A thereunder (to qualified institutional buyers within the United States) and Regulation S thereunder (to non-U.S. persons in offshore transactions). No SEC registration statement will be filed in connection with the offering.
Total Issuance Size: $500,000,000 in aggregate principal amount of notes, issued in three rated classes (Class A, Class B, and Class C) together with a retained overcollateralization interest, as more fully described in Section 2 below.
Governing Law: The State of New York, without regard to its conflicts of laws principles (other than Section 5-1401 of the New York General Obligations Law). The organizational documents of the Issuer and each intermediate special purpose entity shall be governed by the laws of the State of Delaware.
Issuer: Quorum Receivables Funding 2022-1 LLC ("QRF 2022-1"), a Delaware limited liability company organized and existing under the Delaware Limited Liability Company Act, established as a bankruptcy-remote special purpose entity for the sole purpose of acquiring the receivables, issuing the Notes, and performing related activities. QRF 2022-1 was formed on August 3, 2022, and is registered with the Delaware Secretary of State under File No. 7894231. QRF 2022-1 has no prior operating history, no employees, no assets other than the receivables and related property to be acquired in connection with this transaction, and no indebtedness other than the Notes to be issued hereunder.
Sponsor / Parent: Quorum Insurance Holdings Corp. ("QIH"), a Delaware corporation publicly traded on the New York Stock Exchange under the ticker symbol QIHC. QIH is headquartered at 400 Atlantic Street, Suite 2200, Stamford, Connecticut 06901. For the fiscal year ended December 31, 2021, QIH reported consolidated revenue of approximately $3.8 billion. QIH's unsecured long-term credit ratings are BBB by Brindoval Ratings Inc. and Baa2 by Pinnacle Rating Services LLC. QIH is the ultimate parent entity and sponsor of the transaction within the meaning of the risk retention rules promulgated under Section 941 of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
Originator / Seller / Servicer: Quorum Premium Finance LLC ("QPF"), a Delaware limited liability company and wholly owned subsidiary of QIH. QPF is engaged in the business of originating insurance premium finance loans to U.S. commercial policyholders financing property and casualty insurance premiums. As of the cut-off date (June 30, 2022), QPF's total managed insurance premium finance receivables portfolio was approximately $2.1 billion in aggregate principal balance. QPF will act as the initial servicer of the receivables pool pursuant to the terms of the Servicing Agreement.
Depositor / Intermediate SPV: Quorum Receivables Holding LLC ("QRH"), a Delaware limited liability company established as a bankruptcy-remote special purpose entity. The sole member of QRH is QPF. QRH was formed on August 3, 2022, and is registered with the Delaware Secretary of State under File No. 7894228. QRH will serve as an intermediate depositor in the transfer chain, acquiring the receivables from QPF and subsequently transferring such receivables to QRF 2022-1.
Structuring Agent / Lead Bookrunner / Sole Placement Agent: Ridgeline Capital Markets LLC ("Ridgeline"), a Delaware limited liability company and SEC-registered broker-dealer (CRD No. to be confirmed). Ridgeline is located at 383 Madison Avenue, 14th Floor, New York, New York 10179. Ridgeline will act as the sole structuring agent, lead bookrunner, and sole placement agent for the offering of the Notes.
Indenture Trustee / Paying Agent / Calculation Agent / Securities Intermediary / Custodian: Calvoneth Trust Company, N.A. ("Calvoneth Trust"), a national banking association organized under the laws of the United States, acting through its Corporate Trust Office located at 600 Travis Street, Suite 5800, Houston, Texas 77002. Calvoneth Trust will act as indenture trustee under the Indenture, paying agent for the Notes, calculation agent for purposes of determining SOFR-based interest accruals and principal distributions, securities intermediary with respect to the transaction accounts, and custodian of the receivables files.
Back-Up Servicer: Northvane Bank, N.A. ("Northvane"), a national banking association organized under the laws of the United States, with offices at 200 Vesey Street, New York, New York 10281. Northvane will serve as the back-up servicer pursuant to the terms of the Back-Up Servicing Agreement, maintaining a warm standby capability to assume full servicing responsibilities upon the occurrence of a servicer default event.
Liquidity Facility Provider: Northvane Bank, N.A., acting in its capacity as liquidity facility provider pursuant to a separate Liquidity Facility Agreement, as more fully described in Section 8 below.
Independent Manager Provider: Fortbridge Corporate Services LLC will provide the following independent managers for the bankruptcy-remote special purpose entities:
•  Timothy R. Callan — independent manager of QRF 2022-1
•  Eleanor M. Vasquez — independent manager of QRH
Issuer's Counsel: Calderwood & Harkness LLP, 601 Lexington Avenue, New York, New York 10022. Matter No. 1025-00007. Responsible Partner: Douglas Carmichael. Lead Associate: Yuki Nakamura. Tax Partner: Sylvia Hartwell.
Underwriter's Counsel: Calloway & Brandt LLP, One Liberty Plaza, 165 Broadway, New York, New York 10006. Lead Partner: Harrison Collier.
Trustee's Counsel: Ashfield & Greer LLP, One Chase Manhattan Plaza, New York, New York 10005. Lead Partner: Vivian Sato.
Auditor: Meridian Ledger LLP, 1301 Avenue of the Americas, New York, New York 10019. Engagement Partner: Robert Falcone. Meridian Ledger will provide agreed-upon procedures letters and, as applicable, comfort letters in connection with the offering.
Verification Agent: Veristead Analytics LLC, 100 Summer Street, Suite 1500, Boston, Massachusetts 02110. Managing Director: Katharine Drummond. Veristead will verify the accuracy and completeness of receivable-level data provided by QPF for purposes of the rating agency analyses and offering memorandum disclosure.
Rating Agencies: Brindoval Ratings Inc. (Engagement No. CR-SF-2022-08812) and Pinnacle Rating Services LLC (Engagement No. PRS-2022-ABS-3347).
Section 2: Capital Structure
2.1 Tranches.  The Notes will be issued in three rated classes, together with an unrated overcollateralization / retained interest position, as set forth in the table below:
The preliminary CUSIP numbers for the Notes are as follows (placeholder; not yet finalized and subject to confirmation by the CUSIP Service Bureau):
•  Class A Notes: 74892TAA3
•  Class B Notes: 74892TAB1
•  Class C Notes: 74892TAC9
The Brindoval Ratings Inc. preliminary ratings set forth above were issued on August 22, 2022, pursuant to Brindoval's structured finance rating methodology for asset-backed securities backed by short-duration consumer and commercial receivables. The Pinnacle Rating Services LLC preliminary ratings set forth above are expected to be issued by August 29, 2022, pursuant to Pinnacle's applicable rating criteria. Final ratings from both agencies are a condition precedent to closing.
All Notes will be issued in minimum denominations of $250,000 and integral multiples of $1,000 in excess thereof, in book-entry form through The Depository Trust Company ("DTC") and its participants.
2.2 Credit Enhancement
The credit enhancement supporting each class of Notes is comprised of subordination from junior classes and overcollateralization, as follows:
Class A Total Credit Enhancement: 25.0% — The Class A Notes benefit from total credit enhancement of 25.0% of the aggregate initial issuance amount, or $125,000,000, comprised of the following components:
•  Class B subordination: 15.0% ($75,000,000)
•  Class C subordination: 7.0% ($35,000,000)
•  Overcollateralization: 3.0% ($15,000,000)
Class B Total Credit Enhancement: 10.0% — The Class B Notes benefit from total credit enhancement of 10.0% of the aggregate initial issuance amount, or $50,000,000, comprised of the following components:
•  Class C subordination: 7.0% ($35,000,000)
•  Overcollateralization: 3.0% ($15,000,000)
Class C Total Credit Enhancement: 3.0% — The Class C Notes benefit from total credit enhancement of 3.0% of the aggregate initial issuance amount, or $15,000,000, comprised solely of the overcollateralization amount.
The credit enhancement levels described above were confirmed as acceptable by both Brindoval Ratings Inc. and Pinnacle Rating Services LLC during the August 8, 2022 rating agency presentations and in subsequent feedback communications. The credit enhancement levels are unchanged from Version 1 of this term sheet.
2.3 Risk Retention
QIH, as the sponsor of the transaction within the meaning of Section 941 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Dodd-Frank Act") and the implementing risk retention rules set forth in 17 C.F.R. Part 246, intends to satisfy its risk retention obligations by retaining a horizontal risk retention interest in the transaction. Specifically, QIH will retain the $15,000,000 overcollateralization / retained interest, representing 3.0% of the total issuance amount. This retained interest represents the most subordinate economic interest in the securitization and absorbs losses before any other class of Notes.
In addition to the overcollateralization interest, QIH's first-loss exposure through the credit enhancement structure is expected to satisfy the 5% risk retention requirement under the horizontal risk retention option. The precise calculations demonstrating compliance with the fair value methodology prescribed by the risk retention rules will be set forth in the offering memorandum, supported by a fair value analysis to be performed by Meridian Ledger LLP and confirmed in a risk retention compliance opinion to be delivered by Calderwood & Harkness LLP at closing.
QIH will represent and covenant that it will not hedge, transfer, pledge, or otherwise convey any interest in the retained horizontal interest during the applicable holding period, except as permitted by the risk retention rules.
Section 3: Underlying Assets — Receivables Pool
3.1 Description of Receivables
The Notes will be collateralized by a revolving pool of insurance premium finance receivables originated by QPF in the ordinary course of its business. The receivables consist of short-term loans extended to U.S. commercial policyholders for the purpose of financing the payment of premiums on property and casualty insurance policies. Premium finance receivables of this type represent a well-established asset class characterized by short tenors, predictable cash flows, and low historical loss rates.
Each receivable in the pool is secured by an assignment of the borrower's right to receive a refund of unearned premiums from the applicable insurance carrier in the event of policy cancellation. This collateral arrangement provides a built-in recovery mechanism: if a borrower defaults on a premium finance loan, the servicer initiates a cancellation of the underlying insurance policy, and the insurance carrier is required to refund the unearned portion of the premium directly to QPF (or its assignee). The unearned premium refund typically covers a substantial portion of the outstanding loan balance, resulting in high recovery rates and correspondingly low net loss rates.
All receivables in the pool are denominated in U.S. dollars. The obligors on the receivables are U.S. commercial entities, including small and medium-sized businesses, that have elected to finance their property and casualty insurance premiums through QPF rather than paying such premiums in a single lump sum.
3.2 Initial Pool Characteristics (as of Cut-Off Date: June 30, 2022)
The following table sets forth the key statistical characteristics of the initial receivables pool as of the cut-off date of June 30, 2022. These statistics are based on data provided by QPF and verified by Veristead Analytics LLC in accordance with agreed-upon procedures.
The initial pool balance of $612,000,000 exceeds the aggregate outstanding note balance of $500,000,000 by $112,000,000 (approximately 22.4%), providing substantial excess collateral coverage at closing. This excess, together with the 3.0% overcollateralization target amount, ensures that the pool balance remains at all times in excess of the aggregate note balance and the required overcollateralization.
3.3 Eligible Receivables Criteria
Each receivable included in the pool at the closing date, and each receivable added to the pool during the revolving period, must satisfy each of the following eligibility criteria at the time of its transfer to QRH and subsequently to QRF 2022-1:
(i) The receivable was originated by QPF in the ordinary course of QPF's insurance premium finance lending business in compliance with QPF's underwriting policies and procedures;
(ii) The receivable is denominated in U.S. dollars;
(iii) The receivable is secured by a valid and enforceable assignment of the related obligor's right to receive a refund of unearned premiums from the applicable insurance carrier;
(iv) The original term of the receivable does not exceed twelve (12) months from the date of origination;
(v) The obligor on the receivable is a U.S. commercial policyholder (and not a natural person acting in a personal, family, or household capacity);
(vi) The receivable is not in default at the time of transfer, and no payment on the receivable is more than sixty (60) days past due as of the applicable addition date or, in the case of the initial pool, the cut-off date; and
(vii) The receivable was originated in compliance with all applicable federal, state, and local laws, including without limitation all applicable usury laws, state insurance premium finance licensing statutes, and consumer protection laws.
The Servicing Agreement will set forth detailed representations and warranties by QPF with respect to each receivable's satisfaction of the eligible receivables criteria, together with repurchase obligations in the event that any representation or warranty proves to have been untrue in any material respect as of the relevant transfer date.
3.4 Concentration Limits
NOTE: The concentration limits set forth in this Section 3.4 have been revised from Version 1 of this term sheet to reflect specific requirements communicated by Brindoval Ratings Inc. and Pinnacle Rating Services LLC during the August 8, 2022 rating agency presentations and in subsequent follow-up discussions. All revisions are identified below with reference to the applicable agency feedback.
The receivables pool is subject to the following concentration limits, which must be satisfied at all times during the revolving period and tested on each addition date when new receivables are proposed for inclusion in the pool:
Single Obligor Concentration: No single obligor (or group of affiliated obligors) may represent more than 0.75% of the aggregate outstanding pool balance at any time. Version 1 had proposed a single obligor concentration limit of 1.00%. This limit was reduced to 0.75% at the request of both Brindoval Ratings Inc. and Pinnacle Rating Services LLC, which determined that a tighter single-name concentration limit was necessary to support the AAA(cr) and Aaa(p) target ratings on the Class A Notes, given that elevated single-obligor exposure increases idiosyncratic default risk in a granular pool of short-duration receivables.
Single State Concentration: No single state may represent more than 20% of the aggregate outstanding pool balance at any time. Version 1 had proposed a single state concentration limit of 25%. This limit was reduced to 20% at the request of Pinnacle Rating Services LLC, which applied its geographic diversification requirements for structured finance transactions backed by commercial receivables. Brindoval Ratings Inc. indicated that it was comfortable with either the 25% or 20% threshold but did not object to the tighter limit.
Single Insurance Carrier Concentration: No single insurance carrier (or group of affiliated carriers) may represent more than 15% of the aggregate outstanding pool balance at any time. Version 1 had proposed a single insurance carrier concentration limit of 20%. This limit was reduced to 15% at the request of Brindoval Ratings Inc., whose counterparty exposure model for insurance premium finance securitizations identified carrier concentration as a material risk factor in recovery analysis, given that unearned premium refunds (the primary source of loss recovery) are dependent on the financial condition of the applicable carrier.
Confirmation of Initial Pool Compliance: The parties confirm that the initial receivables pool as of the cut-off date of June 30, 2022 satisfies all revised concentration limits:
•  Largest single state concentration: Texas at 14.2% (within the 20% limit)
•  Largest single obligor concentration: 0.38% of pool (within the 0.75% limit)
•  Carrier concentration data to be confirmed in the offering memorandum (expected to be within the 15% limit based on preliminary data provided by QPF)
Compliance with the concentration limits set forth in this Section 3.4 shall be tested on each addition date during the revolving period at which new receivables are proposed for inclusion in the pool. Any receivable the addition of which would cause a breach of any concentration limit shall be deemed ineligible for inclusion in the pool, and QPF shall not transfer such receivable to QRH or QRF 2022-1.
Section 4: Transaction Structure
4.1 SPV Structure and Transfer Chain
The transaction employs a two-tier special purpose entity structure designed to achieve legal isolation of the receivables from the bankruptcy estate of the originator (QPF) and its parent (QIH). The transfer chain is as follows:
Step 1: Origination. QIH, through its wholly owned subsidiary QPF, originates insurance premium finance receivables in the ordinary course of QPF's business.
Step 2: First True Sale. QPF sells the receivables to QRH, the intermediate depositor, pursuant to a Receivables Sale Agreement. This transfer is intended to constitute a "true sale" of the receivables from QPF to QRH for legal, accounting, and federal income tax purposes.
Step 3: Second True Sale / Contribution. QRH sells or contributes the receivables to QRF 2022-1, the issuer, pursuant to a Receivables Transfer Agreement. This transfer is also intended to constitute a "true sale" (or, to the extent characterized as a capital contribution, a transfer that is beyond the reach of QPF's or QRH's creditors) for legal, accounting, and federal income tax purposes.
Step 4: Issuance. QRF 2022-1 pledges the receivables and related property to Calvoneth Trust, as indenture trustee, as security for the Notes issued to investors pursuant to the Indenture.
At each level of the transfer chain, the transferor will grant a back-up security interest in the transferred receivables to the applicable transferee, such that if a court were to recharacterize any transfer as a secured loan rather than a true sale, the transferee would hold a perfected first-priority security interest in the receivables.
UCC-1 financing statements shall be filed with the Delaware Secretary of State to perfect the security interests at each level:
•  QPF (as Debtor) / QRH (as Secured Party)
•  QRH (as Debtor) / QRF 2022-1 (as Secured Party)
•  QRF 2022-1 (as Debtor) / Calvoneth Trust Company, N.A. (as Secured Party, on behalf of the Noteholders)
4.2 Bankruptcy Remoteness
QRF 2022-1 and QRH have each been established as bankruptcy-remote special purpose entities, structured to minimize the risk that the receivables could be consolidated with the bankruptcy estate of QPF, QIH, or any other affiliate. The following bankruptcy remoteness features have been incorporated into the organizational documents and transaction agreements:
Independent Managers. Each of QRF 2022-1 and QRH has appointed an independent manager provided by Fortbridge Corporate Services LLC. Timothy R. Callan serves as the independent manager of QRF 2022-1, and Eleanor M. Vasquez serves as the independent manager of QRH. The consent of the independent manager is required for any voluntary filing for bankruptcy, insolvency, reorganization, or similar proceedings.
Separateness Covenants. The limited liability company agreements of QRF 2022-1 and QRH contain covenants requiring each entity to (a) maintain its own separate books and records, (b) maintain its own bank accounts, (c) not commingle its assets with those of any affiliate, (d) conduct its business in its own name, (e) maintain arm's-length relationships with affiliates, (f) pay its own liabilities from its own assets, (g) observe all limited liability company formalities, (h) maintain adequate capitalization, (i) hold itself out to the public as a separate legal entity, and (j) not guarantee or assume the debts of any other person.
Non-Petition Provisions. Each transaction party that is a creditor of QRF 2022-1 or QRH has agreed not to petition for, or join in any petition for, the bankruptcy, reorganization, or liquidation of QRF 2022-1 or QRH for a period of one year and one day (or, if longer, the applicable preference period) following the payment in full of all obligations under the Notes.
Non-Consolidation Opinions. Calderwood & Harkness LLP will deliver non-consolidation opinions at closing, opining that a court would not, in the event of a bankruptcy of QPF or QIH, substantively consolidate the assets and liabilities of QRF 2022-1 or QRH with those of QPF, QIH, or any other affiliate.
4.3 Revolving Period
The transaction includes a revolving period of twenty-four (24) months commencing on the closing date. During the revolving period, principal collections received on the receivables in the pool will not be used to pay down the Notes. Instead, QPF will sell additional eligible receivables to the pool (through the transfer chain described in Section 4.1) to replenish the pool as existing receivables amortize, prepay, or are charged off.
During the revolving period, the following requirements shall apply:
•  The aggregate outstanding pool balance must at all times equal or exceed $450,000,000 (the "Minimum Pool Balance").
•  The aggregate outstanding pool balance must at all times equal or exceed the sum of (a) the aggregate outstanding note balance of all classes of Notes and (b) the required overcollateralization amount of $15,000,000.
•  Each receivable added to the pool during the revolving period must satisfy all of the eligible receivables criteria set forth in Section 3.3 and must not cause a breach of any of the concentration limits set forth in Section 3.4.
The revolving period will terminate early upon the occurrence of any early amortization event described in Section 6.
4.4 Amortization Period
Following the expiration of the revolving period (whether by scheduled expiration at the end of the 24-month revolving period or by early termination upon the occurrence of an early amortization event), the transaction will enter a controlled amortization period of twelve (12) months. During the amortization period:
•  No new receivables may be added to the pool.
•  Principal collections received on the receivables will be applied to pay down the Notes in sequential order of seniority: first, to the Class A Notes until paid in full; second, to the Class B Notes until paid in full; and third, to the Class C Notes until paid in full.
•  The sequential payment structure ensures that the Class A Notes, as the most senior class, receive the benefit of all principal collections before any payments are made to the Class B or Class C Notes.
4.5 Legal Final Maturity
The legal final maturity date of all classes of Notes shall be forty-two (42) months from the closing date, calculated as follows:
•  24-month revolving period, plus
•  12-month controlled amortization period, plus
•  6-month tail period
The six-month tail period is designed to provide an additional buffer for the collection and distribution of remaining cash flows following the end of the controlled amortization period. If any Notes remain outstanding on the legal final maturity date, the failure to pay principal on such Notes at legal final maturity will constitute an event of default under the Indenture. The expected weighted average life and expected maturity of each class of Notes will be set forth in the offering memorandum based on assumed prepayment and loss rates.
Section 5: Payment Waterfall
On each monthly payment date, the Trustee shall distribute Available Funds (consisting of interest and principal collections on the receivables, net of certain adjustments) in the following order of priority:
1.  Trustee Fees and Expenses. To Calvoneth Trust Company, N.A., as indenture trustee, paying agent, calculation agent, securities intermediary, and custodian, payment of the trustee fee in the amount of $35,000 per annum (payable in monthly installments) plus a per-payment-date fee of $5,000, together with reimbursement of any reasonable out-of-pocket expenses incurred by the Trustee in the performance of its duties under the Indenture.
2.  Servicing Fee. To QPF, as servicer, payment of the servicing fee at a rate of 1.00% per annum on the aggregate outstanding pool balance, payable monthly in arrears. Based on the initial pool balance of approximately $612,000,000, the monthly servicing fee is estimated at approximately $510,000 per month.
3.  Liquidity Facility Repayment. To Northvane Bank, N.A., repayment of any outstanding draws under the Liquidity Facility, together with accrued interest thereon at the drawn rate (SOFR + 150 bps) and commitment fees due and payable.
4.  Class A Note Interest. To the holders of the Class A Notes, payment of accrued and unpaid interest on the Class A Notes at the applicable coupon rate (indicative guidance: SOFR + 125 bps) on the outstanding principal balance of $375,000,000.
5.  Class B Note Interest. To the holders of the Class B Notes, payment of accrued and unpaid interest on the Class B Notes at the applicable coupon rate (indicative guidance: SOFR + 210 bps) on the outstanding principal balance of $75,000,000.
6.  Class C Note Interest. To the holders of the Class C Notes, payment of accrued and unpaid interest on the Class C Notes at the applicable coupon rate (indicative guidance: SOFR + 375 bps) on the outstanding principal balance of $35,000,000.
7.  Class A Principal. During the amortization period, to the holders of the Class A Notes, payment of principal in an amount equal to the Class A scheduled principal distribution amount (or, following an event of default, all available principal collections), until the Class A Notes are paid in full.
8.  Class B Principal. During the amortization period and following the repayment in full of the Class A Notes, to the holders of the Class B Notes, payment of principal in an amount equal to the Class B scheduled principal distribution amount (or, following an event of default, all available principal collections), until the Class B Notes are paid in full.
9.  Class C Principal. During the amortization period and following the repayment in full of the Class A Notes and the Class B Notes, to the holders of the Class C Notes, payment of principal in an amount equal to the Class C scheduled principal distribution amount (or, following an event of default, all available principal collections), until the Class C Notes are paid in full.
10.  Overcollateralization Replenishment. To the extent the overcollateralization amount is less than the target overcollateralization amount of $15,000,000, replenishment of the overcollateralization amount to the target level.
11.  Residual. Any remaining Available Funds to the Issuer for release to the Sponsor as residual collections.
During the revolving period, principal collections (items 7, 8, and 9 above) are not distributed to Noteholders but are instead used by the Issuer to acquire additional eligible receivables from QPF (through QRH), thereby maintaining the pool balance. The waterfall for principal collections during the revolving period will be detailed in the Indenture.
Section 6: Early Amortization Events
NOTE: The early amortization triggers set forth in this Section 6 have been revised from Version 1 of this term sheet to incorporate the specific thresholds and additional triggers requested by Brindoval Ratings Inc. and Pinnacle Rating Services LLC during the August 8, 2022 rating agency presentations and in subsequent follow-up discussions. All revisions are identified below with reference to the applicable agency feedback.
The revolving period shall terminate and the amortization period shall commence immediately upon the occurrence of any of the following early amortization events:
6.1 Performance-Based Triggers
Net Loss Rate Trigger: The three-month rolling average annualized net loss rate on the receivables pool exceeds 2.00% as of any monthly determination date. Version 1 of this term sheet had proposed a net loss rate trigger of 2.50%. This threshold was tightened to 2.00% at the request of both Brindoval Ratings Inc. and Pinnacle Rating Services LLC. Brindoval's stress-scenario modeling for the AAA(cr) rating on the Class A Notes indicated that a 2.00% trigger level was necessary to ensure sufficient time for the transaction to enter amortization and pay down the senior notes before realized losses could impair credit enhancement. Pinnacle's loss-timing assumptions for the Aaa(p) rating similarly required a tighter trigger, reflecting the short-duration nature of the underlying receivables (weighted average remaining term of 5.7 months) and the observation that loss emergence in premium finance receivables occurs rapidly following initial delinquency.
Delinquency Rate Trigger: The 60+ day delinquency rate on the receivables pool exceeds 3.50% of the aggregate outstanding pool balance as of any monthly determination date. Version 1 of this term sheet had proposed a delinquency rate trigger of 4.50%. This threshold was tightened to 3.50% at the request of both Brindoval Ratings Inc. and Pinnacle Rating Services LLC. Both agencies' delinquency migration analyses demonstrated that elevated delinquency levels in insurance premium finance receivables are a strong leading indicator of near-term losses, given the short loan tenors and the fact that borrowers in delinquency on premium finance obligations are unlikely to cure (since the consequence of non-payment is cancellation of the insurance policy, which in many cases has already been initiated by the time a borrower reaches 60+ days past due).
6.2 Structural Triggers
Available Funds Cap Deficit: An available funds cap deficit (i.e., a shortfall in Available Funds to pay the sum of all items senior to and including item 6 in the payment waterfall described in Section 5 above) exists for two (2) consecutive payment periods.
Pool Balance Trigger: The aggregate outstanding pool balance falls below the Minimum Pool Balance of $450,000,000 at any time during the revolving period. This trigger is unchanged from Version 1.
6.3 Servicer-Related Triggers
Servicer Default: The occurrence of a "Servicer Default Event" under the Servicing Agreement, including without limitation:
(a) failure by QPF, as servicer, to make required remittances to the Collection Account within two (2) business days of the applicable remittance date;
(b) material breach by QPF of its servicing obligations under the Servicing Agreement that remains unremedied for a period of thirty (30) days following written notice thereof from the Trustee or the holders of a majority in aggregate principal amount of the outstanding Notes;
(c) the filing of a petition for bankruptcy, insolvency, reorganization, or similar proceedings by or against QPF or QIH, or the appointment of a receiver, conservator, or similar official for QPF or QIH; or
(d) QPF ceases to be a licensed premium finance company in any state in which it is required to hold such license in order to service the receivables in the pool.
Servicer Rating Downgrade: The unsecured long-term credit rating of QPF or QIH falls below BB(cr) as assigned by Brindoval Ratings Inc. or below Ba2(p) as assigned by Pinnacle Rating Services LLC. This trigger was not included in Version 1 of this term sheet. It has been added at the specific request of Pinnacle Rating Services LLC, which determined that the creditworthiness of the servicer is a material consideration in its rating analysis for revolving asset-backed structures, given the servicer's role in collections, loss mitigation, and the addition of new receivables during the revolving period. Brindoval Ratings Inc. did not independently request this trigger but indicated that its inclusion would be viewed favorably in its final rating analysis.
Upon the occurrence of any early amortization event, the revolving period shall terminate immediately and the amortization period shall commence on the next payment date. No new receivables may be added to the pool following the occurrence of an early amortization event. The early amortization triggers are intended to protect Noteholders by ensuring that the transaction begins paying down principal in an orderly manner if the performance of the receivables pool deteriorates beyond expected parameters or if the servicer's ability to perform its obligations is materially compromised.
6.4 Summary of Changes from Version 1
The following table summarizes the key revisions from Version 1 to Version 2 of this term sheet, reflecting rating agency feedback:
All other terms of this term sheet, including the capital structure, credit enhancement levels, payment waterfall, and structural features, remain unchanged from Version 1.
Section 7: Servicing
7.1 Servicer.  QPF shall act as the initial servicer of the receivables pool pursuant to a Servicing Agreement to be entered into among QPF (as servicer), QRF 2022-1 (as issuer), and Calvoneth Trust (as indenture trustee), in form and substance satisfactory to all parties and the rating agencies.
QPF shall be entitled to receive a servicing fee at a rate of 1.00% per annum, calculated on the aggregate outstanding pool balance as of each monthly determination date and payable monthly in arrears from Available Funds pursuant to the payment waterfall set forth in Section 5 (priority item 2). Based on the initial pool balance of approximately $612,000,000, the monthly servicing fee is estimated at approximately $510,000 per month. The servicing fee rate is intended to compensate QPF for all costs and expenses incurred in connection with its servicing duties and is consistent with market rates for premium finance receivables servicing.
As servicer, QPF shall be responsible for the following functions:
•  Collection of all payments due on the receivables, including principal, interest (finance charges), and late fees;
•  Delinquency management, including the initiation of insurance policy cancellation proceedings and the collection of unearned premium refunds from insurance carriers;
•  Loss mitigation and recovery activities, including engagement of collection agents as appropriate;
•  Monthly reporting to the Trustee, the Noteholders, the rating agencies, and the back-up servicer, including the preparation and delivery of servicer reports containing pool performance data, payment date calculations, and compliance certificates;
•  Compliance with all applicable federal, state, and local laws, including without limitation state insurance premium finance licensing statutes and regulations; and
•  Maintenance of complete and accurate records with respect to each receivable in the pool.
7.2 Back-Up Servicer
Northvane Bank, N.A. shall serve as the back-up servicer pursuant to a Back-Up Servicing Agreement to be entered into among Northvane (as back-up servicer), QPF (as servicer), QRF 2022-1 (as issuer), and Calvoneth Trust (as indenture trustee).
Northvane shall be entitled to receive a back-up servicing fee of $50,000 per annum, payable quarterly in arrears in installments of $12,500 per quarter. The back-up servicing fee shall be payable from Available Funds as an operating expense of the Issuer.
Northvane's duties as back-up servicer shall include:
•  Maintaining a warm standby capability to assume full servicing responsibilities within a specified transition period (anticipated to be no more than thirty (30) days) upon the occurrence of a servicer default;
•  Receiving and processing regular data tapes from QPF containing receivable-level information, including loan balances, payment status, delinquency status, and loss data;
•  Conducting periodic reconciliations of the data received from QPF against the Trustee's records; and
•  Being prepared to assume all servicing functions, including collections, delinquency management, loss mitigation, reporting, and compliance, upon the occurrence of a servicer default event.
The primary contact at Northvane Bank for matters relating to the back-up servicing arrangement is Diane Coletti, Managing Director, Structured Products Division.
Section 8: Liquidity Facility
A revolving liquidity facility will be established to provide temporary liquidity support for the timely payment of interest on the Notes in the event of short-term cash flow timing mismatches. The liquidity facility is not a credit enhancement facility and is not intended to cover credit losses on the receivables.
Provider: Northvane Bank, N.A.
Facility Size: $25,000,000
Commitment Fee: 0.25% per annum on the undrawn committed amount, calculated on a 360-day basis and payable quarterly in arrears. At the full committed amount of $25,000,000, the annual commitment fee is $62,500.
Drawn Rate: SOFR + 150 bps, calculated on a 360-day basis and payable monthly on each payment date.
Purpose: The liquidity facility may be drawn upon solely to cover temporary shortfalls in Available Funds necessary to make timely interest payments on the Notes. The facility may not be drawn to cover principal payments, credit losses, or any other shortfall unrelated to temporary timing mismatches in the receipt and distribution of collections.
Draw Conditions: Detailed conditions precedent to each draw under the liquidity facility shall be set forth in the Liquidity Facility Agreement to be entered into between QRF 2022-1 (as borrower) and Northvane (as liquidity facility provider), in form and substance satisfactory to the parties, the Trustee, and the rating agencies.
Repayment Priority: Outstanding draws under the liquidity facility, together with accrued interest thereon, shall be repaid from Available Funds on each payment date in accordance with the waterfall set forth in Section 5 (priority item 3). Liquidity facility repayments are senior to all Note interest and principal payments but subordinate to trustee fees and expenses and the servicing fee.
Term: The liquidity facility shall be available throughout the revolving period and the amortization period, subject to the satisfaction of applicable draw conditions. Northvane's commitment under the facility may be terminated upon the occurrence of certain specified events, including the downgrade of Northvane's own credit rating below the minimum required level.
Section 9: Accounts
The following segregated trust accounts shall be established and maintained at Calvoneth Trust Company, N.A. in connection with the transaction:
Collection Account: All collections received on the receivables in the pool, including principal payments, finance charge payments, late fees, and unearned premium refunds, shall be deposited by the servicer (QPF) into the Collection Account maintained at Calvoneth Trust. Collections shall be deposited within two (2) business days of receipt by the servicer, in accordance with the terms of the Servicing Agreement. The Collection Account shall be an eligible deposit account or securities account maintained with a qualified institution meeting the credit requirements of the rating agencies.
Payment Account: On each monthly payment date, the Trustee shall transfer funds from the Collection Account to the Payment Account in the amounts required to make distributions to the parties in accordance with the payment waterfall set forth in Section 5. All payments to Noteholders, the servicer, the back-up servicer, and other transaction parties shall be made from the Payment Account.
Reserve Account: A reserve account shall be established and funded to the required level at closing, as determined in the Indenture. The Reserve Account shall provide an additional source of funds to cover shortfalls in Available Funds, subject to the terms and conditions set forth in the Indenture. The required reserve balance and funding mechanics shall be finalized in the transaction documents.
Liquidity Reserve Account: A separate account shall be maintained for the deposit and management of proceeds received from draws under the Liquidity Facility. Funds on deposit in the Liquidity Reserve Account shall be applied solely to make timely interest payments on the Notes in accordance with the payment waterfall and shall not be available for any other purpose.
All accounts described above shall be subject to an Account Control Agreement entered into among QRF 2022-1 (as account holder), Calvoneth Trust (as securities intermediary and trustee), and QPF (as servicer). Pursuant to the Account Control Agreement, Calvoneth Trust shall have exclusive control over each account as securities intermediary within the meaning of Article 8 and Article 9 of the Uniform Commercial Code, and no withdrawals from or transfers out of any account may be made except in accordance with the terms of the Indenture and the Account Control Agreement.
Funds on deposit in the accounts shall be invested in eligible investments as specified in the Indenture. Eligible investments shall be limited to short-term, high-quality money market instruments consistent with the investment criteria of both Brindoval Ratings Inc. and Pinnacle Rating Services LLC, including without limitation U.S. Treasury securities, overnight repurchase agreements collateralized by U.S. Treasury securities, and money market funds rated in the highest short-term rating category by each of the rating agencies.
Section 10: Representations, Warranties, and Covenants
10.1 Representations and Warranties
QPF, in its capacity as seller and servicer, shall make the following customary representations and warranties in the Receivables Sale Agreement and the Servicing Agreement, as applicable, with respect to each receivable included in the pool at closing and each receivable added to the pool during the revolving period:
(a) Each receivable satisfies all of the eligible receivables criteria set forth in Section 3.3 at the time of its transfer to QRH and subsequently to QRF 2022-1;
(b) Each receivable was validly originated by QPF in the ordinary course of QPF's insurance premium finance lending business in compliance with QPF's credit and underwriting policies and procedures;
(c) The origination and servicing of each receivable is in compliance with all applicable federal, state, and local laws, including without limitation all applicable usury laws, state insurance premium finance licensing statutes, truth-in-lending laws (to the extent applicable to commercial transactions), and consumer protection laws;
(d) QPF has a valid first-priority security interest in the unearned premium refund rights securing each receivable, and such security interest has been validly assigned to QRH and subsequently to QRF 2022-1 pursuant to the applicable transfer documents;
(e) No receivable is subject to any lien, security interest, encumbrance, or other claim, other than the security interest granted to QRH and subsequently to QRF 2022-1 and the lien of the Indenture in favor of the Trustee;
(f) The receivable data provided by QPF to the Verification Agent (Veristead Analytics LLC) is true, correct, and complete in all material respects as of the applicable cut-off date or addition date;
(g) Each receivable constitutes an "account," "chattel paper," "payment intangible," or "general intangible" within the meaning of Article 9 of the Uniform Commercial Code; and
(h) QPF is the sole legal and beneficial owner of each receivable at the time of its sale to QRH, free and clear of any adverse claims.
In the event that any representation or warranty made by QPF with respect to a receivable proves to have been untrue in any material respect as of the applicable transfer date, QPF shall be required to repurchase such receivable from QRF 2022-1 (through QRH) at a price equal to the outstanding balance of such receivable plus accrued and unpaid interest thereon, within sixty (60) days following discovery or notice of such breach.
10.2 Covenants.  Each of QIH and QPF shall covenant and agree in the applicable transaction documents as follows:
(a) QIH and QPF shall maintain all required state insurance premium finance licenses and shall promptly notify the Trustee and the rating agencies of any revocation, suspension, or material modification of any such license;
(b) QPF shall continue to service the receivables in the pool in accordance with customary and prudent premium finance servicing standards, consistent with the standards employed by QPF in servicing comparable receivables in its own portfolio and in compliance with the Servicing Agreement;
(c) QRF 2022-1 and QRH shall maintain their bankruptcy-remote status and shall comply with all separateness covenants set forth in their respective limited liability company agreements;
(d) QIH shall maintain its minimum required unsecured long-term credit ratings above the early amortization trigger levels set forth in Section 6.3 (i.e., at or above BB(cr) from Brindoval Ratings Inc. and at or above Ba2(p) from Pinnacle Rating Services LLC);
(e) QPF shall comply with the concentration limits set forth in Section 3.4 on each addition date during the revolving period and shall not transfer any receivable to QRH the inclusion of which would cause a breach of any concentration limit; and
(f) QPF shall deliver to the Trustee and the back-up servicer monthly servicer reports in the form and within the time periods specified in the Servicing Agreement, and shall provide all information reasonably requested by the rating agencies in connection with their ongoing surveillance of the transaction.
Section 11: Events of Default
The following shall each constitute an "Event of Default" under the Indenture:
(a) Failure to Pay Interest. Failure by the Issuer to pay interest on any class of Notes when due and payable on any payment date, subject to a grace period of five (5) business days following the applicable payment date;
(b) Failure to Pay Principal at Maturity. Failure by the Issuer to pay the outstanding principal balance of any class of Notes on the legal final maturity date;
(c) Breach of Representation or Warranty. Any representation or warranty made by the Issuer, the Seller, or the Servicer in any transaction document proves to have been untrue or incorrect in any material respect when made or when deemed to have been made, and such breach remains unremedied for a period of sixty (60) days following written notice thereof from the Trustee or the holders of Notes representing at least 25% of the aggregate outstanding principal amount;
(d) Breach of Covenant. Failure by the Issuer, the Seller, or the Servicer to observe or perform any material covenant, obligation, or agreement set forth in the Indenture, the Servicing Agreement, or any other transaction document, and such failure remains unremedied for a period of thirty (30) days following written notice thereof from the Trustee or the holders of Notes representing at least 25% of the aggregate outstanding principal amount (or such longer cure period as may be specified in the applicable transaction document);
(e) Insolvency or Bankruptcy. The Issuer, the Seller, the Servicer, or the Sponsor (i) files a petition for bankruptcy, insolvency, reorganization, receivership, or similar proceedings, (ii) has an involuntary petition for any such proceeding filed against it that is not dismissed within sixty (60) days, (iii) makes an assignment for the benefit of creditors, or (iv) has a receiver, conservator, liquidator, or similar official appointed for all or substantially all of its assets;
(f) Servicer Default. The occurrence of a Servicer Default Event under the Servicing Agreement that has not been cured within the applicable cure period;
(g) Invalidity of Security Interest or True Sale. A court of competent jurisdiction enters a final, non-appealable judgment or order determining that (i) the transfers of receivables from QPF to QRH or from QRH to QRF 2022-1 do not constitute true sales and do not create valid first-priority security interests in favor of the applicable transferee, or (ii) the security interest of the Trustee in the receivables and related property is not a valid, perfected, first-priority security interest.
Remedies. Upon the occurrence and continuance of an Event of Default, the Trustee (acting at the direction of the holders of Notes representing at least a majority of the aggregate outstanding principal amount of Notes, or, in the case of an Event of Default under clause (a) or (b) above, the holders of the affected class) may declare the principal of and accrued interest on all outstanding Notes to be immediately due and payable, and may direct enforcement of remedies against the collateral securing the Notes, including the exercise of rights and remedies under Article 9 of the Uniform Commercial Code and any other applicable law. The Trustee shall have no obligation to exercise any remedy unless it has been indemnified to its satisfaction against any costs, expenses, and liabilities that may be incurred in connection with such exercise. The rights and remedies of the Trustee and the Noteholders shall be as set forth in the Indenture.
Section 12: Legal Opinions to Be Delivered at Closing
The following legal opinions shall be delivered at or prior to closing as conditions precedent to the issuance of the Notes:
1.  True Sale Opinions. Opinions of Calderwood & Harkness LLP (Sylvia Hartwell, Tax Partner, and Douglas Carmichael, Responsible Partner) that (a) the transfer of receivables from QPF to QRH pursuant to the Receivables Sale Agreement constitutes a "true sale" of such receivables and not a secured financing for purposes of applicable law, and (b) the transfer of receivables from QRH to QRF 2022-1 pursuant to the Receivables Transfer Agreement constitutes a "true sale" of such receivables and not a secured financing for purposes of applicable law.
2.  Non-Consolidation Opinions. Opinions of Calderwood & Harkness LLP that, in the event of a bankruptcy, insolvency, or similar proceeding involving QPF or QIH, a court applying applicable law would not substantively consolidate the assets and liabilities of QRF 2022-1 or QRH with those of QPF, QIH, or any other affiliate.
3.  Enforceability Opinion. Opinion of Calderwood & Harkness LLP that the Indenture and the Notes constitute the legal, valid, and binding obligations of QRF 2022-1, enforceable against QRF 2022-1 in accordance with their respective terms, subject to customary enforceability exceptions (including bankruptcy, insolvency, reorganization, moratorium, and other laws affecting creditors' rights generally, and general principles of equity).
4.  Security Interest Perfection Opinion. Opinion of Calderwood & Harkness LLP that the security interests granted by QRF 2022-1 in favor of the Trustee in the receivables, the proceeds thereof, and the transaction accounts constitute valid and perfected first-priority security interests under Article 9 of the Uniform Commercial Code.
5.  Tax Characterization Opinions. Opinions of Calderwood & Harkness LLP (Sylvia Hartwell, Tax Partner) that (a) the Notes will be treated as debt for U.S. federal income tax purposes, and (b) QRF 2022-1 will be treated as a disregarded entity (or qualifying SPE) for U.S. federal income tax purposes and will not be subject to entity-level taxation.
6.  No Registration Opinion. Opinion of Calderwood & Harkness LLP that the offering and sale of the Notes in the manner described in the offering memorandum are exempt from the registration requirements of the Securities Act of 1933, as amended, pursuant to Rule 144A and Regulation S thereunder.
7.  Delaware LLC Opinions. Opinions of Calderwood & Harkness LLP that each of QRF 2022-1 and QRH has been validly formed as a limited liability company under the Delaware Limited Liability Company Act, is in good standing in the State of Delaware, and has the power and authority to execute and deliver the transaction documents to which it is a party and to perform its obligations thereunder.
8.  Underwriter's Counsel Opinion. Opinion of Calloway & Brandt LLP (Harrison Collier, Lead Partner) covering such matters as are customary for the benefit of the underwriter in a Rule 144A / Regulation S asset-backed securities offering, including no registration, disclosure, and 10b-5 negative assurance.
9.  Trustee's Counsel Opinion. Opinion of Ashfield & Greer LLP (Vivian Sato, Lead Partner) covering the due authorization, execution, and delivery of the Indenture by Calvoneth Trust and the valid acceptance by Calvoneth Trust of the trust created thereunder.
All legal opinions shall be in form and substance satisfactory to Ridgeline Capital Markets LLC, the rating agencies, and the respective counsel of each party. Copies of all legal opinions shall be delivered to the rating agencies in connection with their final rating analyses.
Section 13: Placement Fees and Expenses
13.1 Placement Fees
The following placement fees shall be payable to Ridgeline Capital Markets LLC, as sole placement agent, upon the successful closing of the offering:
Placement fees are payable at closing from the proceeds of the offering or from other funds of the Sponsor. The fee schedule above reflects the differential placement effort and investor outreach required for each class of Notes, with higher fee rates for the more subordinate (and less liquid) classes.
13.2 Other Fees and Expenses
The following additional fees and expenses are expected to be incurred in connection with the transaction:
Up-front transaction costs (including legal fees, rating agency initial fees, auditor fees, verification agent fees, and Trustee acceptance fees) shall be borne by the Sponsor. Ongoing fees (including trustee fees, servicing fees, back-up servicing fees, liquidity facility commitment fees, and rating agency surveillance fees) shall be payable from Available Funds in accordance with the payment waterfall and the terms of the applicable transaction documents.
Section 14: Tax Considerations
The following is a summary of the principal U.S. federal income tax considerations relating to the proposed transaction. This summary is based on current law and practice and is subject to change. Each investor should consult its own tax advisor regarding the tax consequences of an investment in the Notes.
Treatment of Notes as Debt. The Notes are intended to be treated as indebtedness for U.S. federal income tax purposes, and not as equity interests in QRF 2022-1 or any other entity. Holders of the Notes will be required to include interest income on the Notes in their gross income in accordance with their regular method of accounting for U.S. federal income tax purposes.
Disregarded Entity Status. QRF 2022-1 is intended to be treated as a disregarded entity (or qualifying special purpose entity) for U.S. federal income tax purposes and will not be subject to entity-level federal income taxation. As a disregarded entity, the assets and liabilities of QRF 2022-1 will be treated as the assets and liabilities of its sole member (QRH, or, ultimately, QPF and QIH) for U.S. federal income tax purposes.
FATCA Compliance. The Notes will be structured to comply with the withholding requirements of the Foreign Account Tax Compliance Act ("FATCA"), as enacted in Sections 1471 through 1474 of the Internal Revenue Code of 1986, as amended. Non-U.S. holders of the Notes will be required to provide applicable W-8 documentation (including IRS Form W-8BEN, W-8BEN-E, or W-8IMY, as applicable) to the Trustee in order to establish an exemption from FATCA withholding. Payments on the Notes to holders that fail to provide the required documentation may be subject to a 30% FATCA withholding tax.
State Tax Considerations. QRF 2022-1 and QRH have been organized and will be operated in a manner intended to avoid state-level franchise, income, or other entity-level tax exposure in states other than Delaware. QRF 2022-1 and QRH will be subject to the Delaware annual limited liability company tax. Investors should consult their own tax advisors regarding any state or local tax implications of an investment in the Notes.
Tax Opinions. Tax characterization opinions (covering the debt treatment of the Notes and the disregarded entity status of QRF 2022-1) will be delivered at closing by Sylvia