V

STATE OF MICHIGAN CIRCUIT COURT FOR THE 30TH JUDICIAL CIRCUIT

INGHAM COUNTY

ANITA G. FOX, DIRECTOR OF THE DEPARTMENT OF INSURANCE AND FINANCIAL SERVICES,

Case No. 19-504-CR Petitioner,

HON. WANDA M. STOKES

PAVONIA LIFE INSURANCE COMPANY [IN REHABILITATION] OF MICHIGAN,

Respondent.

Christopher L. Kerr (P57131) Aaron W. Levin (P81310) Assist ant Attorneys General Attorneys for Petitioner Corporate Oversight Division P . 0 . Box 30736 Lansing, MI 48909 (517) 335-7632 ________________ ./

PETITION FOR APPROVAL OF DAVIS POLK & WARDWELL LLP'S COMPENSATION AS

INVESTIGATION COMPLIANCE LEGAL COUNSEL

Anita G. Fox, Director of the Michigan Department of Insurance and

Financial Services ("DIFS"), as Reh abilitator of Pavonia Life Insurance Company of

Michigan (the "Rehabilita tor"), by and through her attorneys, Dana Nessel,

Attorney General, a nd Christopher L. Ken and Aaron W. Levin, Assist ant

Attorneys General, petitions this Cour t pursuant to MCL 500.8114(1) to approve

the compensation previously paid and to be paid to the law firm of Davis Polk a nd

Wardwell LLP ("Davis Polle") in connection with its engagement as investigation

compliance legal counsel for Pavonia Life Insurance Company of Michigan

("Pavonia" or the "Company") and its wholly-owned subsidiary, Global Bankers

Insurance Group, LLC ("ServiceCo"), in rehabilitation. In support of this Petition,

the Rehabilitator states as follows:

l. On July 9, 2019, this Court entered a Stipulated Order placing

Pavonia and its subsidiary, ServiceCo, into Rehabilitation and appointing the DIFS

Director as the Rehabilitator ("Rehabilitation Order"). The Rehabilitator further

appointed James E. Gerber, Janice Sylvertooth, and Julianne Gulliver as Special

Deputy Rehabilitators, whose compensation this Court approved.

2. MCL 500.8114(1) authorizes the Rehabilitator to "employ such counsel,

clerks, and assistants as considered necessary" to carry out her functions as

Rehabilitator and assist with the ongoing rehabilitation.

3. MCL 500.8114(1) further authorizes the Rehabilitator to fix, with the

Court's approval, the compensation of any "counsel, clerks, and assistants" that the

Rehabilitator elects to employ.

4. Pursuant to MCL 500.8114(1), any persons appointed by the

Rehabilitator under this statute "shall serve at the pleasure of' the Rehabilitator.

5. As background, and as previously explained to the Court in the

petition to place Pavonia and ServiceCo into rehabilitation, Pavonia became part of

an insurance holding company system within the meaning of Section 115(c) of the

Insurance Code, MCL 500.115(c), following the Company's acquisition by GBIG

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Holdings, Inc. ("GBIG Holdings") in December 2017. As a result of this acquisition,

Pavonia is now a wholly-owned subsidiary of GBIG Holdings and an affiliated

company (through common ownership by GBIG Holdings) of four other North

Carolina domestic insurance companies: (1) Colorado Bankers Life Insurance

Company; (2) Southland National Reinsurance Corporation; (3) Southland National

Insurance Corporation; and (4) Bankers Life Insurance Company (collectively, the

"Pavonia NC Affiliates"). ServiceCo is a wholly-owned subsidiary of Pavonia and

provides all executive management, regulatory oversight review, and

administrative services for Pavonia's and the Pavonia NC Affiliates' operations.

Completing the relevant holding company structure, GBIG Holdings is a wholly­

owned subsidiary of GBIG Capital, LLC, which in turn is wholly-owned by Greg E.

Lindberg, a North Carolina resident. Mr. Lindberg is therefore Pavonia's ultimate

upstream owner and the Company's ultimate controlling person.

6. On June 27, 2019, the North Carolina Commissioner of Insurance

("North Carolina Commissioner") placed the Pavonia NC Affiliates into court­

supervised rehabilitation. The Pavonia NC Affiliates, as well as their ultimate

controlling person Greg E. Lindberg, consented to the rehabilitation. Pursuant to

the verified petition resulting in the North Carolina order of rehabilitation, the

North Carolina Commissioner developed reasonable concerns regarding whether

the Pavonia NC Affiliates' investment activity in non-insurance affiliated companies

provided sufficient liquidity to assure the Pavonia NC Affiliates' ability to meet

their outstanding financial obligations.

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7. In April 2019, the United States Department of Justice ("DOJ'')

unsealed a federal criminal indictment in the Western District of North Carolina

charging Pavonia's ultimate owner , Greg E. Lindberg, with conspiracy to commit

wire fraud and bribery of a public official. M1·. Lindberg denied all charges and

proceeded to trial on 01· around February 18, 2020. On March 5, 2020, the jury

returned a guilty verdict against Mr. Lindberg on both counts.

8. Prior to Mr. Lindberg's criminal indictment, and therefore well before

the commencement of this rehabilitation on July 9, 2019, the DOJ served two

extensive grand jury subpoenas on ServiceCo dated August 20, 2018 and November

6, 2018. The August 20, 2018 subpoena focused on the bribery and wii-e fraud

allegations against Mr. Lindberg, while the later , November 6, 2018 subpoena

focused on the Pavonia NC Affiliates' investment activity in non-insurance affilia ted

companies. As stated, both subpoenas were broad in scope, and the November 6,

2018 subpoena in particular requested records involving the business operations of

not only Service Co, but also of Pavonia and the Pavonia NC Affiliates.

9. In response to the grand jury subpoenas, and again, prior to Pavonia

being placed into rehabilitation, ServiceCo management decided to engage the

Davis Polle law firm in September 2018 for the purpose of responding to any DOJ

subpoenas and related inquiries, as well as to conduct an internal investigation into

the matters raised by the subpoenas. (Exhibit A, Davis Polk Initial Engagement.)

10. Davis Polk is an international, full-service, New York-based law firm

that was founded in 1849. (See Exhibit B, Davis Polk firm information.) The firm

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has just under 1,000 total attorneys and business offices in 10 major cities across

t he globe. (Id.) Specific to this rehabilitation, the DOJ subpoenas, and the internal

investigation, Davis Polk is an industry "leader in representing clients in regulatory

enfo1·cement proceedings and government investigations." Specifically, among the

firm's listed expertise in the regulatory compliance area are the services of: (a)

Responding to subpoenas; and (b) Conducting internal investigations. (Id.)

Accordingly, Davis Polk is emine~tly qualified to represent Pavonia and ServiceCo

in connection with the DOJ subpoenas and intexnal investigation.

10. After this rehabilitation commenced on July 9, 2019, Special Deputy

Rehabilitator J ames Gerber and other Reh abilitator representatives met in person

with Davis Polk representatives to discuss the law firm's services being provided to

ServiceCo, Pavonia, and the Pavonia NC Affiliates. Ultima tely, the Rehabilitator

and Special Deputy Gerber dete1·mined that Davis Polk was well-qualified and best

positioned to continue providing these legal services to Pavonia and ServiceCo,

which included ongoing responses to the DOJ subpoenas and related inquiries, in­

person meetings with the DOJ to ensure compliance, and furtherance of the

internal investigation. Consequently, the Special Deputy Rehabilitator, acting in

the interest of Pavonia and Service Co, affirmed the continuance of the Davis Polk

engagement that ServiceCo had first entered into in September 2018.

11. Following the commencement of this rehabilitation, Davis Polk

continued to submit bills to the Special Deputy Rehabilitator under its existing

engagement agreement with ServiceCo, which included invoices dated March 31,

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2019 through August 31, 2019 totaling $2,628,956. (See Exhibit C, Post­

Rehabilitation Davis Polk Billings & Payments.) Pursuant to the terms of a cost­

sharing agreement between ServiceCo, Pavonia, and the Pavonia NC Affiliates,

Pavonia was initially responsible for 30% of these Davis Polk billings, which

amounted to $788,686.76. (Id.) Consistent with the existing Davis Polk

engagement and the cost-sharing agreement, the Special Deputy Rehabilitator

therefore authorized payment of this $788,686.76 as Pavonia's allocated portion of

Davis Polk's invoices through August 31, 2019, via payments made from July 18,

2019 to December 11, 2019. (Id.)

12. In or around August 2019, the Special Deputy Rehabilitator began

negotiations for a new engagement agreement with Davis Polk that more accurately

reflected the allocated portion of the firm's legal services that related to the Pavonia

NC Affiliates, on the one hand, and to Pavonia, on the other . Stated differently,

because an increasing portion of Davis Polk's legal services concerned the November

6, 2018 DOJ subpoena and related inquiries focused on the Pavonia NC Affiliates'

investment activity in non-insurance affiliated companies, the Special Deputy

Rehabilitator sought a new engagement agreement that would decrease Pavonia's

allocated responsibility for Davis Polk's legal bills.

13. Toward this end, Davis Polk and the Special Deputy Rehabilitator

entered into a new engagement agreement that was finalized and signed by the

Special Deputy Rehabilitator on December 16, 2019, but that had a retroactive

effective date of September 1, 2019. (Exhibit D, Davis Polk Replacement

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Engagement.) The new engagement provides that "[t]o ensure that the Client

[Pavonia] is paying an equitable portion of our fees, we have agreed that as of the

date of this en gagement letter [September 1, 2019], the Client will pay 20% of our

overall fees ." (Id. at p 2.) In addition, the new engagement provides that Pavonia

"will not pay for any fees of FT! Consulting"-a forensic accounting firm retained by

Davis Polk whose services are focused on the Pavonia NC Affiliates' investment

activity in non-insurance affiliated companies-without prior approval. (Id. at p 3.)

14. Under this new engagement, Davis Polk has submitted invoices to the

Special Deputy Rehabilitator dated September 30, 2019 through December 31, 2019

totaling $1,728,939.95. (See Exhibit C, Post-Rehabilitation Davis Polk Billings &

Payments.) Applying the reduced 20% allocation for Pavonia, its responsibility for

these billings amounted to $345,787.99. (Id.) Consistent with the new Davis Polk

engagement, the Special Deputy Rehabilitator therefore authorized payment of this

$345,787.99 as Pavonia's allocated portion of Davis Polk's invoices through

December 31, 2019, via payments made from December 20, 2019 to March 3, 2020.

(Id.) Notably, the reduction in Pavonia's allocated share from 30% to 20% applied to

these Davis Polk billings for September through December 2019 have saved the

Pavonia rehabilitation estate over $172,000.

15. Davis Polk's billings are justified by the firm's expertise and the

extraordinary amount of work it has completed to date. As examples, with respect

to the DOJ subpoenas, Davis Polk has now reviewed over 465,000 documents

covering specified search terms and 14 different records custodians. Davis Polk has

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made 23 separate document productions to the DOJ thus far, totaling over 136,000

documents. There are approximately 1,000 documents remaining to be reviewed,

plus a second-level privilege review of about 64,000 documents currently marked as

privileged. In addition, Davis Polk has made four separate, in-person formal

presentations to the DOJ in response to various questions raised.

16. The Rehabilitator and Special Deputy Rehabilitator J ames Gerber

have determined that the employment of Davis Polk as investigation compliance

legal counsel, together with the compensation previously paid and to be paid to

Davis Polk in exchange for its services, are necessary and appropriate for the

effective and efficient administration of this rehabilitation proceeding, are in the

interests of justice, and will promote the protection of Pavonia's policyholders,

creditors, and the public.

17. Combining the $788,686.76 that Pavonia paid Davis Polk from the

beginning of the rehabilitation through December 11, 2019 with the $345,787.99

that Pavonia paid Davis Polk from December 20, 2019 to March 3, 2020, the total

amount that Pavonia has paid Davis Polk during the rehabilitation to date is

$1,134,474.75. Due to this significant amount of Davis Polk billings a,nd payments

involved in the Pavonia rehabilitation, and pursuant to MCL 500.8114(1), the

Rehabilitator requests this Court to ratify and/or retroactively approve these

payments made by Pavonia to Davis Polk to date.

18. In addition, the Rehabilitator asks this Court to approve Davis Polk's

compensation on a going-forward basis under the terms of the engagement

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agreement attached as Exhibit D, which allocates to Pavonia 20% of the overall fees

for any future Davis Polk billings.

19. Personally serving this Petition, the Notice of Hearing, and any

resulting Order on every individual or entity that may have a general interest in

Pavonia's rehabilitation would be impractical at this time because there is no risk,

given Pavonia's solvent financial condition, that the Court's approval of Davis Polk's

compensation will negatively affect any of Pavonia's creditors, policyholders, or the

public. Moreover , attempting to identify and personally notify every individual or

entity having such a general interest would be time-intensive and costly to

Pavonia's rehabilitation estate. For these reasons, the Rehabilitator request s that

the Court authorize and ratify service of this Petition, the Notice of Hearing, and

any resulting Order by the following methods:

(a) Personally serving by regular mail both: (i) local counsel for the Seller of Pavonia (GBIG Holdings, Inc., c/o its counsel, Zachary Larsen at Clark Hill PLC); and (ii) local counsel for the prospective Buyer of Pavonia (Aspida Holdco, LLC, c/o its counsel, Lori McAllister at Dykema Gossett PLLC), which are the two parties to the existing Stock Purchase Agreement having a direct interest in this Petition; and

(b) Posting electronic copies on the DIFS website, www.michigan.gov/difs, under the section "Who We Regulate," the subsection "Receiverships," and the sub-subsection "Pavonia Life Insurance."

Service in this manner is r easonably calculated to give potentially interested

individuals and entities actual notice of these proceedings and is otherwise

reasonable under the circumstances.

20. Seller's and Buyer's counsel (along with their respective clients) are

aware and supportive of the Rehabilitator's compensation paid to Davis Polk for its

9

services as investigation compliance legal counsel. Accordingly, the Rehabilitator's

undersigned counsel does not expect Seller's and Buyer's counsel to object to this

Petition or to participate at the hearing on the Petition currently scheduled on April

2, 2020 at 8:30 a.m. Upon Seller's and Buyer's counsel filing with the Court

a statement of no ob·ection the Rehabilitator would therefore re uest that

the Court enter the attached approval Order without any hearing.

WHEREFORE, for the reasons stated above, the Rehabilitator respectfully

requests this Court to enter the Order in the form at tached as Exhibit E, which: (a)

approves the compensation previously paid and to be paid to the Davis Polk law

firm for its services as investigation compliance legal counsel; and (b) authorizes

and ratifies service of this Petition, the Notice of Hearing, and the attached Order

by personally serving Seller's and Buyer's local counsel via regular mail and by

posting electronic copies on the "Pavonia Life Insurance" section of the DIFS

website.

Respectfully submitted,

Dana Nessel Attorney General

( I \; >. ' t:.-,\ "\_ -v, '\. Christopher L. Kerr (P57131) Aaron W. Levin (P81310) Assistant Attorneys General Attorneys for Petitioner Corporate Oversight Division P. 0. Box 30736 Lansing, MI 48909 (517) 335-7632

Dated: March 23, 2020

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EXHIBIT A

New York Paris NorthOrn California Madrid Washington DC Tokyo Slio Paulo Bol)lng London Hong Kong

Davis Polk Martine M. Beamon

Davis Polk & Wardwell LLP 212 450 4262 tel 450 Lexington Avenue 212 701 5262 fax New York, NY 10017 martlne.beamon@dav!spolk.com

September 11, 2018

Re: Special Committee Matter

Mr. Tamre Edwards Chief Legal Officer Global Bankers Insurance Group 2327 Englert Drive Durham, NC 27713

Dear Mr. Edwards,

We are pleased that you have selected Davis Polk 1 to act as your special counsel in connection with the matter described below. This letter confirms the terms of, and certain additional matters with respect to, our engagement.

BASIC TERMS OF ENGAGEMENT

Scope of Services and Related Matters

Scope

Davis Polk wi ll act as special counsel to Global Bankers Insurance Group, LLC ("Global Bankers" or the ''Client"), acting at the direction of and reporting to a Special Committee of Global Bankers (the "Committee") In conducting an internal investigation and providing legal and governance advice with respect to issues raised by the United States Attorney's Office for the Western District of North Carolina and other federal and state agencies, and other matters relating thereto.

Identification of the Client

Davis Polk has been engaged to represent Global Bankers acting at the direction of and reporting to the Committee. Unless specifically agreed to in writing, Davis Polk has not been retained to represent, and does not have an attorney-client relationship with: (i) any individual officer, director, employee or agent of Global Bankers (excepting the members of the Committee in their capacity as members of the Committee, and not in their individual capacities); (ii) any parent, subsidiary, or other affiliate of Global Bankers: (Iii) any partnership of which Global

"Davis Polk ' includes Davis Polk & Wardwell LLP and its associated entities. 1

September 11, 2018

Bankers or any member of the Special Committee is a partner (general or limited) or any joinUmultiple venture or unincorporated association of which Global Bankers or any member of the Special Committee Is a member; or (iv) any fund or account managed by the Client or by any member of the Special Committee. As a consequence and as provided below, Davis Polk may, during the representation of Global Bankers, continue or take on representations of other clients which are adverse to any such individuals or entities (the "Client Affiliates").

Fee and Billing Matters

Our fees for this engagement will be based on hourly billing rates assigned to the individuals performing the work, which vary depending primari ly on seniority.

The applicable hourly rates for this engagement range from $1,270 to $1,515 for partners, $1,245 for counsel, and from $620 to $1 ,030 for associates, a category which may include law graduates who have not yet been admitted to the Bar.

These rates are subject lo adjustment from time to time. Please note that whether or not there is any adjustment to our rates generally, the rate applicable to any individual wi ll change automatically when such individual moves to the next higher level of seniority.

Non-Professional Charges and Disbursements

In addition to our fees, you will be obl igated to pay charges for non-professional support services (such as document processing, photocopying and computerized research) and to reimburse us for disbursements (such as postage, freight, travel and overtime expenses).

Non-professional charges represent charges we assess for non-professional support services where the amounts attributable to each matter cannot be determined directly from invoices. These support services may be rendered by third parties (as in the case of computerized research), in which case our charge is based on an allocation of the actual cost to us in providing lhe service, or they may be provided directly by the firm (as in the case of document processing), in which case our charge is based upon consideration of our cost as well as the customary charges of alternative providers.

Disbursements, on the other hand, represent dollar-for-dollar reimbursement of amounts paid by the firm to third parties on your behalf, where the specific amounts attributable to each matter can be determined directly from the invoices rendered by such third parties.

Unless special arrangements are made, fees and expenses of others (such as local counsel, experts, investigators, witnesses, consultants and court reporters) and other large disbursements will not be paid by our firm and will be the responsibility of, and billed directly to, the Client.

Bi/fing Frequency

Our practice is to bill clients monthly on matters of this nature. Experience has shown that bill ing on this basis keeps clients fully informed of the level of costs they are Incurring and ratlonalizes the entire billing process.

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September 11 , 2018

Terms of Payment

Our bi lls are payable upon receipt and are expected to be paid within 30 days after the bill date. The Company may find it convenient to wire transfer remittances directly to our bank account at JPMorgan Chase Bank, 500 Stanton Christiana Rd., Newark, DE 19713 (ABA #021 000 021 , Account #001533316).

The Company is obligated to pay our fees and other charges . The issue of payments or reimbursements from insurance carriers or other third parties is a matter solely between the Company and any such third party and in no way affects the Company's obligation to pay our charges when due.

Retainer

The company has agreed to pay us a retainer at the commencement of this engagement in the amount of $1,000,000. The Company has agreed that the retainer will not be used to pay our bills unless it fails to pay in a timely manner, and the Company has authorized us to apply this retalner to amounts due to us. In addition, the Company has agreed to replenish the retainer amount to the extent that it has been applied and will increase the retainer amount if additional services are requested or the volume of legal work increases significantly. Any retainer remainlng unapplied at the conclusion of the matter will be promptly returned to the Company.

Arbitration Rights

If a dispute arises with respect to our fees, the Client may have a right to have such a dispute arbitrated pursuant to Part 137 of the Rules of the Chief Administrator of the Courts of the State of New York, provided that, among other things, the amount in dispute is not greater than $50,000.

Obligation to Preserve, and to Suspend Routine Destruction or Alteration of, Documents and Other Evidence

As a general matter, litigants have an obligation to preserve evidence relating to a pending or anticipated litigation, which includes the obligation to suspend any procedures that would result in the destruction or alteration of documents or other evidence. The obligation to preserve usually will require the notification of individuals having potentially relevant documents or other Information, taking steps to preserve both hard copy and all forms of electronic inform"!tion , and taking steps to suspend procedures and programs that destroy, delete or alter electronic or other information. Failure to comply with this obligation may result in very serious sanctions or penalties.

Termination

Either the Client or Davis Polk may terminate this engagement at any time for any reason by written notice, subject on our part to applicable rules of professional responsibility. Unless previously terminated, this engagement will terminate upon the completion of our assignment. Upon termination of this engagement and unless otherwise specifically agreed in writing, Davis Polk's representation of the Client will end, and thereafter there will be no ongoing attorney-client

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September 11, 2018

relationship between Davis Polk and the Client or obligations of Davis Polk to advise you with respect to changes in law or other developments.

Governing Law and Exclusive Forum

This Agreement shall be governed by and construed in accordance with the law of the State of New York, without regard to conflict of law provisions that might provide for the application of the law of any other jurisdiction, and, to the extent not prohibited by law or rule, the state and federal courts of New York will have exclusive jurisdiction lo adjudicate any dispute arising under or in connection with this Agreement and no such dispute may be commenced in any other court.

ADDITIONAL MATTERS RELATING TO THIS ENGAGEMENT

Your instructlng us or continuing to instruct us on this matter constitutes your full acceptance of the terms set out above and below. With respect to the matters set forth below, we ask that you also confirm your agreement, after obtaining any further information you deem necessary and after such advice from other counsel as the Committee deems appropriate by signing and returning lo us a copy of this letter.

Scope Limitation

If any additional services beyond those described above in the section "Scope," are necessary or adv'isable to represent the Cl'ient adequately, you may need to retain separate counsel. The engagement does not include advice with respect to the tax consequences to the Client arising from the assignment. Accordingly, the engagement will include advice with respect to only those tax matters as to which the Client and Davis Polk subsequently agree in writing.

Conflicts and Consents

We are not aware of any other representation by Davis Polk which would preclude us from undertaking this engagement or adversely affect our ability to complete it. The Client is not aware of any information to the contrary.

We also represent and in the future will represent a large number of other clients in a wide variety of legal matters. Some such clients may be direct competitors of the Client or otherwise may have business interests that are contrary to the Client's interests. It is possible that, during the time we are working for you, an existing or future client may seek to engage us in connection with an actual or potential transaction or pending or potential litigation or other dispute resolution proceeding in which such client's interests are or potentially may become adverse to the Client's interests.

Davis Polk cannot enter into this engagement if It could interfere with our ability to represent existing or future clients who have or may in the future have relationships or interests adverse to the Client. Therefore, the Client agrees that, in matters that are not substantially related to those in which we have been or may in the future be engaged by the Client, that is, in circumstances in which any of your confidential data or information, as normally would have been obtained by us in our representation of you, would not be material to any new matter adverse to you that we might accept from another client, we may represent current or future clients in general or on specific matters where the interests of the parties are different from, inconsistent with, or adverse

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September 11, 2018

to, the Client's interests, including, without limitation, in negotiations, acquisitions, dispositions and other transactions, litigation, alternative dispute resolution and administrative proceedings, and other legal matters ("Adverse Representations"). The Client consents to, and waives any objection with respect to, such Adverse Representations, and agrees that it will not assert that our representation of the Client in this or any other matter or our possession of confidential Information obtained from the Client, provides a basis for disqualifying us from representing another party in an Adverse Representation or otherwise constitutes a breach of any obligation or duty that we may owe to the Client.

Similarly, with respect to this matter and any other current or future matters where we are asked to represent the Client, the Client consents to our representation despite the fact that one or more counterparties or other adverse parties in this or such other matters in which we are asked to represent the Client are also clients of the Firm on matters that are not substantially related to our work for the Client. We confirm that we will not disclose or use any confidential Information that we have obtained from the Client without its prior consent and will not otherwise use or disclose any such confidential information in connection with any Adverse Representation.

Further, you agree that we may continue or accept new Adverse Representations that are adverse to Client Affiliates as discussed above at the end of the section "Identification of the Client." In addition, we may consult at our own expense with lawyers at Davis Polk or elsewhere with respect to our own ethical and professional obligations with respect to our representation of you. The Client consents to such consultations, waives any conflict of interest relating thereto, and agrees that such consultations are protected by Davis Polk's own attorney-client privi lege.

You also agree that the foregoing waivers and consents apply both to this assignment and to any ongoing or future assignments.

Use of Information Obtained in Other Representations

It is possible that, in connection with its representations of other clients, Davis Polk may have obtained or may obtain in the future information with respect to the Client or other matters which Davis Polk may be prohibited from disclosing to the Client or using in connection with our representation of the Client because of obligations to such client or otherwise. The Client acknowledges and agrees that Davis Polk is not under an obligation to disclose such information to the Client or to use such information in connection with our representation of the Client and the Client further agrees that it will not assert that Davis Polk has an actual or potential conflict or has breached any duty or obligation to the Client by virtue of Davis Polk's possession of such information, our not revealing such information to the Client, and/or our not using such information in connection with our representation of the Client.

Indemnification

The Client agrees to lndemn.ify and hold harmless Davis Polk, and each of its attorneys, for any and all costs, claims, judgments, liabilities, damages and losses, including but not limited to any legal or other expenses, in connection with any claim, suit or allegation brought or made by any person or party other than directly by the Client itself, arising out of the firm's work for the Client in connection with this engagement, including for investigating or defending any matter that could give rise to such costs, claims, judgments, liabilities, damages or losses. In addition, the Client has been advised and understands that Davis Polk may be compelled by law to respond to

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September 11, 2018

requests for information, documents and testimony from regulators, law enforcement agencies or private litigants. The Client agrees to indemnify and hold harmless Davis Polk and each of its attorneys for all costs and fees incurred by Davis Polk In responding to those requests, and will pay the fees of Davis Polk incurred in responding to such requests.

Client Files

Upon completion or other termination of this engagement and payment of our fina l bill (unless otherwise required by law), your files with respect to this engagement will be delivered to you at your request. The Client acknowledges and agrees that the Client's files do not include Davis Polk accounting records, or other internal Davis Polk documents, e-mails or communications or drafts of any documents prepared by us in connection with this engagement. We will retain documents relating to this engagement only so long as we deem appropriate or as required by law and thereafter may dispose of documents or other materials.

Data Protection

Davis Polk will collect, process, store and transfer personal data disclosed to us by or on behalf of you ("Personal Information"), including (i) information from and relating to you; (ii) business, financial and accounting data relating to you; and (iii) personal data relating to any living individuals identified or identifiable as part of the matters on which you instruct us.

We collect, process, store and transfer Personal Information within the Davis Polk group (a list of our offices is set out at https://www.davispolk.com/offices) and/or to our agent(s) and seNlce providers (including any third parties retained by us, together with their successors and assigns), including to a jurisdiction outside your home jurisdiction, in accordance with relevant data protection laws and regulations, In each case as further set out in our Privacy Notice, available at https://www.davispolk.com/files/davis-polk-privacy-notice.pdf and on request. In connection with the foregoing, the Davis Polk entities have entered into a global co-operation agreement. We act as an independent data controller when processing Personal Information in the course of our work for you. You are responsible for ensuring that the provision by or on behalf of you of Personal Information to us complies with applicable data protection laws and regulations, and you will not do or omit to do anything that would cause us to be in breach of any such law or regulation. We will comply with applicable data protection laws and regulations when processing Personal Information.

If you have any questions, complaints or need further information about our privacy practices, please contact our Privacy Team at privacy.team@davispolk.com.

E-mail

Communications with Davis Polk through an e-mail system maintained by an employer other than Global Bankers may not be protected by the attorney-client privilege. When communicating with us by e-mail, we recommend that you use a Global Bankers or personal e-mail account. In our e-mail communications to you, we will continue to use the e-mail address you have previously supplied to us (Including by your electronic communications to us) unless you notify us otherwise.

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September 11, 2018

Please send, as an e-mail attachment if convenient, a countersigned copy of this letter to my attention. I will be the attorney responsible for this engagement, and I will be glad to discuss any aspect of It with you at your convenience. We look forward to working with you and the Committee.

Very truly yours,

Martine Beamon

Global Bankers Insurance Group

.r..~m:~ Chief Legal Officer

Date: q /?.. 7-/ I '?

Special Committee of Global Bankers Insurance Group

Mr. Laurence B. Deitch

Chair of the Special Committee

Date:

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EXHIBIT B

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Regulatory Enforcement and Investigations I Practices I Davis Polk & Wardwell LLP Page l of 1

Davis Polk Rcj!ulalory E111'orccmc11t llnd ln,·cstigHtions

Davis Polk is a leader In representing clients in regulatory en forcement proceedings and government investigations. As a firm at the forefront of all aspects of financial regulatory reform. we have an in-depth understanding of the critical issues that lhe financial services Industry has confronted since the financial crisis.

Our ability to advise on a full range of bank and trading and markets regulatory issues enables us to provide candid and informed assessments and proactive risk management arising from the complex problems clients face.

Our cross-border team combines years of government experience with the breadth and scope of leading practitioners in banking regulation, trading and markets regulation, enforcement and investigations, litigation, antitrust and corporate practices.

Our extensive understanding of the agencies involved in financial regulation makes us particularly suited to advise clients in connection with:

• Interacting with the various regulators In multiagency inquiries

• Responding to subpoenas

o Conducting internal investigations

• Negotiating enforcement orders across multiple jurisdictions

• Handling removal and prohibition orders and civil money penalties

o Defending corporate directors and officers, accountants and attorneys

A large part of our practice involves representing financial institutions, corporations, individuals and professional firms In nonpublic regulatory proceedings conducted by the prudential banking regulators, markets regulators and state regulators. including the slate

AGs.

We have a long history of working directly with the various agencies and understand their structure, strategic vision and priorities.

https ://www. davi spo lie com/practices/Ii ti ga ti on/regulatory-enforcement-and-investigations 3/19/2020

Davis Polk & Wardwell - Wikipedia Page I of 1

Davis Polk & Wardwell LLP

Davis Polk Headquarters

I No. of offices

I No. of attorneys

Major practice

areas

Key people

Revenue

Date founded

Company type

Website

450 Lexington Avenue

New York City, NY

10

982 (201 st1

Capital Markets

Corporate/M&A

Financial Services

Regulation

Investment Management

Private Equity

Litigation

Insolvency /Restru ctu ring

Antitrust

Credit/Financing

Tax

Neil Barr, Managing Partner

A $1.4 billion (2018)l21

1849

Limited liability partnership

www.davispolk.com

(http://www.davispolk.com)

https://en.wikipedia.org/wiki/Davis_Polk_%26_ Wardwell 3/19/2020

EXHIBIT C

Date Bill Paid Total Bill 20% - PUC 30% • PUC

03/03/20 Legal services thru 12/31/ 19 $ 310,146.86 $ 62,029.37

01/23/20 Legal services thru 11/30/19 $ 202,469.35 $ 40,493.87

12/20/19 Legal services thru 10/31/ 19 $ 556,432.45 $ 111,286.49

12/20/19 Legal services thru 09/30/19 $ 659,891.29 $ 131,978.26

12/11/19 Legal services thru 08/31/ 19 $ 478,249.07 $ 143,474.72

10/02/19 Legal services thru 07/31/ 19 $ 686,760.57 $ 206,028.17

10/02/19 Legal services thru 06/30/19 $ 413,776.48 $ 124,132.94

07/18/19 Legal services thru 03/31/19 $ 1,050,169.76 $ 315,050.93

$ 4,357,895.83 $ 345,787.99 $ 788,686.76

EXHIBIT D

New York Paris Northern Calltomla Madrid Washington DC Tokyo Sio Paulo Beijing London Hong Kong

Davis Polk Martine M. Beamon

Davis Polk & Wardwell LLP 212 450 4262 tel 450 Lexington Avenue 212 701 5262 fax New York, NY 10017 martine.beamon@davlspolk.com

September 1, 2019

Re: Global Bankers Matter

James Gerber, CFE Special Deputy Rehabllitator Pavonia Life Insurance Company of Michigan 2327 Englert Drive Durham, NC 27713

Dear Mr. Gerber,

We are pleased that you have selected Davis Polk1 to act as your special counsel in connection with the matter described below. This letter confirms the terms of, and certain additional matters with respect to, our engagement.

BASIC TERMS OF ENGAGEMENT

Scope of Services and Related Matters

Scope

Davis Polk will act as special counsel to Pavonia Life Insurance Company of Michigan ("Pavonia" or the "Client"). Pavonia has been placed into rehabilitation under Chapter 81 of the Michigan Insurance Code. As Pavonia's Special Deputy Rehabilitator, you exercise all powers of Pavonla's officers, directors and managers. As such, we will be acting at your direction and reporting to you In your capacity as Pavonia's Special Deputy Rehabilitator in conducting an internal investigation and providing legal advice and governance advice with respect to issues raised by the United Sates Attorney's Office for the Western District of North Carolina and other federal and state agencies, and other matters relating thereto.

1 "Davis Polk • Includes Davis Polk & Wardwell LLP and Its associated entitles.

#92520349v3

September 1, 2019

Identification of the Client

Davis Polk has been engaged to undertake the representation of the Client and only the Client. Unless specifically agreed to In writing, Davis Polk has not been retained to represent, and does not have an attorney-client relationship with: (i) any Individual officer, director, employee or agent of the Client or the Department of Insurance and Financial Services of the State of Michigan ("DIFS") (excepting the Special Deputy Rehabilltator or his deslgnees In their capacity as directing this engagement, and not in any other capacity); (II) any parent, subsldlary, or other affiliate of the Client or DIFS; (iii) any partnership of which the Client or DIFS or the Special Deputy Rehabllitator or his designees is a partner (general or limlted) or any joint/multiple venture or unincorporated association of which the Client or DIFS or the Special Deputy Rehabilitator or his designees ls a member; or 0v) any fund or account managed by the Client or DIFS or by the Special Deputy Rehabllltator or his deslgnees. As a consequence and as provided below, Davis Polk may, during the representation of the Client, continue or take on representations of other clients which are adverse to any such Individuals or entitles (the "Client Affiliates").

Fee and BIiiing Matters

Our fees for this engagement will be based on hourly billing rates assigned to the Individuals performing the work, which vary depending primarily on seniority.

The applicable hourly rates for this engagement range from $1,345 to $1,605 for partners, $1,320 for counsel, and from $655 to $1,090 for associates, a category which may Include law graduates who have not yet been admitted to the Bar.

These rates are subject to adjustment from time to time. Please note that whether or not there is any adjustment to our rates generally, the rate applicable to any individual will change automatically when such Individual moves to the next higher level of seniority.

As the Client Is aware, our work in responding to issues raised by the U.S. Attorney's Office Involves not only Pavonla, but also several other insurance companies domiciled in another state. To ensure that the Client is paying an eQuitable portion of our fees, we have agreed that as of the date of this engagement letter, the Client will pay 20% of our overall fees.

Non-Professional Charges and Disbursements

In addition to our fees, you will be obligated to pay charges for non-professional support services (such as document processing, photocopying and computerized research) and to reimburse us for disbursements (such as postage, freight, travel and overtlme expenses).

Non-professional charges represent charges we assess for non-professional support services where the amounts attributable to each matter cannot be determined directly from invoices. These support services may be rendered by third parties (as in the case of computerized research), in which case our charge is based on an allocation of the actual cost to us in providing the service, or they may be provided directly by the firm (as in the case of document processing), in which case our charge Is based upon consideration of our cost as well as the customary charges of altematlve providers.

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September 1 , 2019

Disbursements, on the other hand, represent dollar-for-dollar reimbursement of amounts paid by the firm to third parties on your behalf. where the specific amounts attributable to each matter can be determined directly from the invoices rendered by such third parties.

Unless special arrangements are made, fees and expenses of others (such as local counsel, experts, Investigators, witnesses, consultants and court reporters) and other large disbursements will not be paid by our firm and will be the responsibility of, and billed directly to, the Client In that regard, we have agreed with the Cllent that, as of the date of this engagement letter and to ensure an equitable allocation of costs relating to the Investigation, the Client will not pay for any fees of FTI Consulting, without prior approval, and will pay 20% of the remainder of our costs.

Billing Frequency

Our practice is to bill clients monthly on matters of this nature. Experience has shown that billing on this basis keeps clients fully Informed of the level of costs they are Incurring and rationalizes the entire billing process.

Terms of Payment

Our bills are payable upon receipt and are expected to be paid within 30 days after the bill date. The Cllent may find It convenient to wire transfer remittances directly to our bank account at JPMorgan Chase Bank, 500 Stanton Christiana Rd., Newark, DE 19713 (ABA #021 000 021, Account #001533316).

The Client Is obligated to pay our fees and other charges. The Issue of payments or reimbursements from insurance earners or other third parties Is a matter solely between the Client and any such third party and in no way affects the Client's obligation to pay our charges when due.

Arbitration Rights

If a dispute arises with respect to our fees, the Client may have a right to have such a dispute arbitrated pursuant to Part 137 of the Rules of the Chief Administrator of the Courts of the State of New York, provided that, among other things, the amount In dispute is not greater than $50,000.

Obligation to Preserve, and to Suspend Routine Destruction or Alteration of, Documents and Other Evidence

As a general matter, litigants have an obligation to preseive evidence relating to a pending or anticipated litigation. which Includes the obligation to suspend any procedures that would result in the destruction or alteration of documents or other evidence. The obligation to preserve usually will require the notification of individuals having potentially relevant documents or other Information, taking steps to preserve both hard copy and all forms of electronic information, and taking steps to suspend procedures and programs that destroy, delete or alter electronic or other Information. Failure to comply with this obligation may result In very serious sanctions or penalties.

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September 1, 2019

Termination

Either the Client or Davis Polk may tenninate this engagement at any time for any reason by written notice, subject on our part to applicable rules of professional responsibility. Unless previously terminated, this engagement will tenninate upon the completion of our assignment or the Michigan rehabilitation, whichever Is earlier. Upon termination of this engagement and unless otherwise specifically agreed in writing, Davis Polk's representation of the Client will end, and thereafter there will be no ongoing attorney-client relationship between Davis Polk and the Client or obligations of Davis Polk to advise you with respect to changes in law or other developments.

Governing Law and Exclusive Forum

This Agreement shall be governed by and construed in accordance with the law of the State of Michigan, without regard to conflict of law provisions that might provide for the application of the law of any other jurisdiction, and, to the extent not prohibited by law or rule, the Ingham County, Michigan, Circuit Court overseeing the Client's Michigan rehabilitation will have exclusive jurisdiction to adjudicate any dispute arising under or In connection with this Agreement and no such dispute may be commenced In any other court.

ADDITIONAL MATTERS RELATING TO THIS ENGAGEMENT

Your instructing us or continuing to instruct us on this matter constitutes your full acceptance of the terms set out above and below. With respect to the matters set forth below, we ask that you also confirm your agreement, after obtaining any further Information you deem necessary and after such advice from other counsel as the Client deems appropriate by signing and returning to us a copy of this letter.

Scope LlmitatJon

If any additional services beyond those described above In the section "Scope," are necessary or advisable to represent the Client adequately, you may need to retain separate counsel. The engagement does not include advice with respect to the tax consequences to the Client arising from the assignment Accordingly, the engagement will include advice with respect to only those tax matters as to which the Client and Davis Polk subsequently agree In writing.

Conflicts and Consents

We are not aware of any other representation by Davis Polk which would preclude us from undertaking this engagement or adversely affect our ability to complete il The Client is not aware of any information to the contrary.

We also represent and In the future will represent a large number of other clients In a wide variety of legal matters. Some such clients may be direct competitors of the Client or otherwise may have business Interests that are contrary to the Client's Interests. It Is possible that. during the time we are working for you, an existing or future client may seek to engage us in connection with an actual or potential transaction or pending or potential litigation or other dispute resolution proceeding In which such client's Interests are or potentially may become adverse to the Cllent's interests. In particular, and without waiving the generality of the previous sentence, as we have discussed. you are aware that we are representing Purdue Pharma LLP ("Purdue") In restructuring and other proceedings, Including in matters In which Purdue may be adverse to the

4 09282034M

September 1, 2019

State of Michigan. In addition, we represent Czech Asset Management, L.P., In connection with establishing a fund-of-one for the State of Michigan Retirement System. We also currently handle and from time to time handle criminal matters opposite Michigan law enforcement. You consent to our engagement by the Client notwithstanding the potential adversity In these matters.

Davis Polk cannot enter Into this engagement If it could Interfere with our ablllty to represent existing or future clients who have or may In the future have relatlonshlps or interests adverse to the Client. Therefore, the Client agrees that, in matters that are not substantially related to those in which we have been or may In the future be engaged by the Client, that is, in clrcumstances in which any of your confidential data or information. as normally would have been obtained by us in our representation of you, would not be material to any new matter adverse to you that we might accept from another client, we may represent current or Mure clients in general or on specific matters where the Interests of the parties are dlfferent from, inconsistent with, or adverse to, the Client's interests, Including, without limitation, in negotiations, acquisitions, dispositions and other transactions, litigation, alternative dispute resolution and administrative proceedings, and other legal matters ("Adverse Representations"). By way of example and without limitation, the Client agrees that we may be adverse to it in negotiations, claims, suits, motions or other matters arising out of or in connection with financial distress, restructuring, reorganization, workouts, Insolvency, bankruptcy, liquidation or other similar circumstances and also In negotiations, claims, suits, motions or other matters arising out of or in connection with residential mortgage-backed securities, collateralized debt obligations or other similar instruments. The Client consents to, and waives any objection with respect to, such Adverse Representations, and agrees that It will not assert that our representation of the Client in this or any other matter or our possession of confidentlal information obtained from the Client, provides a basis for disqualifying us from representing another party In an Adverse Representation or otherwise constitutes a breach of any obligation or duty that we may owe to the Client.

Similarly, with respect to this matter and any other current or future matters where we are asked to represent the Client, the Client consents to our representation despite the fact that one or more counterpartles or other adverse parties in this or such other matters in which we are asked to represent the Client are or may become clients of the Firm on matters that are not substantially related to our work for the Client We confirm that we will not disclose or use any confidential information that we have obtained from the Client without Its prior consent and will not otherwise use or disclose any such confidential Information in connection with any Adverse Representation.

Further, you agree that we may continue or accept new representations, including negotiations, acquisitions, dispositions and other transactions, litigation, alternative dispute resolution and administrative proceedings, that are adverse to Client Affiliates as discussed above at the end of the section "Identification of the Client." In addition, we may consult at our own expense with lawyers at Davis Polk or elsewhere with respect to our own ethical and professional obligations with respect to our representation of you. The Client consents to such consultations, waives any conflict of interest relating thereto, and agrees that such consultations are protected by Davis Polk's own attorney-client privilege.

You also agree that the foregoing waivers and consents apply both to this assignment and to any ongoing or future assignments.

5 1'192620349v3

September 1, 2019

Use of lnfonnatlon Obtained In Other Representations

It Is possible that, In connection with its representations of other clients, Davis Polk may have obtained or may obtain in the future information with respect to the Client or other matters which Davis Polk may be prohibited from disclosing to the Client or using in connection with our representation of the Client because of obligations to such client or otherwise. The Client acknowledges and agrees that Davis Polk is not under an obligation to disclose such information to the Client or to use such information in connection with our representation of the Client and the Client further agrees that it will not assert that Davis Polk has an actual or potential conflict or has breached any duty or obligation to the Client by virtue of Davis Polk's possession of such information, our not revealing such information to the Client, and/or our not using such information in connection with our representation of the Client.

Indemnification

The Client agrees to Indemnify and hold harmless Davis Polk. and each of its attorneys, for any and all costs, claims, judgments, liabilities, damages and losses, including but not limited to any legal or other expenses, In connection with any claim, suit or allegation brought or made by any person or party other than directly by the Client itself, arising out of the firm's work for the Client in connection with this engagement, Including for investigating or defending any matter that could give rise to such costs, claims, judgments, liabilities, damages or losses. in addition, the Client has been advised and understands that Davis Polk may be compelled by law to respond to requests for information, documents and testimony from regulators, law enforcement agencies or private litigants. The Client agrees to indemnify and hold harmless Davis Polk and each of its attorneys for all costs and fees incurred by Davis Polk in responding to those requests, and will pay the fees of Davis Polk Incurred in responding to such requests.

Client Files

Upon completion or other termination of this engagement and payment of our final bill (unless otherwise required by law), your files with respect to this engagement will be delivered to you at your request. The Client acknowledges and agrees that the Client's flies do not include Davis Polk accounting records, or other internal Davis Polk documents, e-mails or communications or drafts of any documents prepared by us in connection with this engagement. We will retain documents relating to this engagement only so long as we deem appropriate or as required by law and thereafter may dispose of documents or other materials.

Data Protection

Davis Polk will collect, process, store and transfer personal data disclosed to us by you on behalf of you ("Personal Information"). Including (i) information from and relating to you; (Ii) business, financial and accounting data relating to you; and (iii) personal data relating to any living Individuals identified or identifiable as part of the matters on which you Instruct us.

We collect, process, store and transfer Personal information within the Davis Polk group (a list of our offices is set out at https:/lwww.davispolk.com/offices) and/or to our agent(s) and service providers (including any third parties retained by us, together with their successors and assigns), including a jurisdiction outside your home jurisdiction, in accordance with relevant data protection laws and regulations, in each case as further set out in our Privacy Notice, available at

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September 1, 2019

(https://www.daylspolk.com/flles/davispolk.privacypolicy.pdf). and on request. In connection with the foregoing, the Davis Polk entities have entered into a global co-operation agreement. We act as independent data controller when processing Personal Information in the course of our work for you. You are responsible for ensuring that the provision by or on behalf of you and Personal Information to us complies with applicable data protection laws and regulations, and you will not do or omit to do anything that would cause us to be in breach of any such law or regulation. We will comply with applicable data protection laws and regulations when processing Personal Information.

If you have any questions, complaints or need further information about our privacy practices. please contact our Privacy Terms at privacy.team@davispolk.com.

Email

Communications with Davis Polk through an e-mail system maintained by an employer other than DIFS may not be protected by the attorney-client privilege. When communicating with us by e-mail, we recommend that you use a DIFS e-mail account. In our e-mail communications to you, we will continue to use the e-mail address you have previously supplied to us (Including by your electronic communications to us) unless you notify us otherwise .

. . . . . Please send, as an e-mail attachment if convenient, a countersigned copy of this letter to my attention. I will be the attorney responsible for this engagement, and I will be glad to discuss any aspect of it with you at your convenience. We look forward to working with you.

Pavonia Life Insurance Company of Michigan

By: Jal'nesGerber, CFE Special Deputy Rehabllitator

Date: ,,1 .,2 • /, .,z. o.1 'J

7 "92520349v3

EXHIBIT E

V

STATE OF MICHIGAN CIRCUIT COURT FOR THE 30TH JUDICIAL CIRCUIT

INGHAM COUNTY

ANITA G. FOX, DIRECTOR OF THE DEPARTMENT OF INSURANCE AND FINANCIAL SERVICES,

Case No. 19-504-CR Petitioner ,

HON. WANDA M. STOKES

PAVONIA LIFE INSURANCE COMPANY [IN REHABILITATION] OF MICHIGAN,

Respondent.

Christopher L. Kerr (P57131) Aaron W. Levin (P81310) Assistant Attorneys General Attorneys for Petitioner Corporate Oversight Division P. 0. Box 30736 Lansing, MI 48909 (517) 335-7632 _______________ ./

ORDER APPROVING DAVIS POLK & WARDWELL LLP'S COMPENSATION AS

INVESTIGATION COMPLIANCE LEGAL COUNSEL

At a session of said Court held in the Circuit Courtrooms

for the County of Ingham, State of Michigan, on the

__ day of _____ _, 2020.

PRESENT: HONORABLE WANDA M. STOKES, CIRCUIT COURT JUDGE

WHEREAS, Anita G. Fox, Di.rector of the Michigan Department oflnsurance

and Financial Services ("DIFS") and duly appointed Rehabilitator of Pavonia Life

Insurance Company of Michigan (the "Rehabilitator"), has filed a Petition for

Approval of Davis Polk & Wardwell LLP's Compensation as Investigation

Compliance Legal Counsel (the "Petition");

WHEREAS, MCL 500.8114(1) authorizes the Rehabilitator to "employ such

counsel, clerks, and assistants" as she considers necessary, whose compensation

shall be fixed by the Rehabilitator with the approval of the Court; and

WHEREAS, the Rehabilitator and Special Deputy Rehabilitator James

Gerber have determined that the employment of Davis Polk and Wardwell, LLP

("Davis Polk") as investigation compliance legal counsel, together with the

compensation previously paid and to be paid to Davis Polk in exchange for its

services, are necessary and appropriate for the effective and efficient administration

of this rehabilitation proceeding, are in the interests of justice, and will promote the

protection of Pavonia's policyholders, creditors, and the public;

NOW, THEREFORE, IT IS HEREBY ORDERED that the Com·t

APPROVES the compensation to be paid to Davis Polk, as fixed by the Rehabilitator

pursuant to the terms set forth in the Petition and the engagement agreement

attached thereto as Exhibit D, in connection with Davis Polk's employment as

investigation compliance legal counsel for Pavonia Life Insurance Company of

Michigan ("Pavonia") and its wholly-owned subsidia1·y, Global Bankers Insurance

Group, LLC, in rehabilitation.

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IT IS FURTHER ORDERED that the Court ratifies and/or retroactively

approves the payments tot aling $1,134,474.75 previously made by Pavonia to Davis

Polk from the beginning of this rehabilitation to March 3, 2020 as compensation for

Davis Polk's services as investigation compliance legal counsel.

IT IS FURTHER ORDERED that due to the difficulty and prohibit ive cost

associat ed with personally serving the Petition, Notice of Hearing, and this Order

on every individual or entity that may h ave a general interest in Pavonia's

rehabilitation, t he Court authorizes, apprnves, and/or ratifies the Rehabilitator's

service of the Petition, the Notice of Hearing, and this Order by the following

methods:

(a) Personally serving by regular mail both: (i) local counsel for the Seller of

Pavonia (GBIG Holdings, Inc., c/o its counsel, Zachary Larsen at Clark Hill

PLC); and (ii) local counsel for the prospective Buyer of Pavonia (Aspida

Holdco, LLC, c/o its counsel, Lori McAllister at Dykema Gossett PLLC),

which are the two parties to the existing Stock Purchase Agreement having a

direct interest in the Petition; and

(b) Posting electronic copies on the DIFS website, www.michigan.gov/difs,

under the section "Who We Regulate," the subsection "Receiverships," and

the sub-subsection "Pavonia Life Insurance."

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The Court finds that service in the foregoing manner is reasonably calculated

to give potentially interested individuals and entities actual notice of these

proceedings and is otherwise reasonable under the circumstances.

IT IS SO ORDERED.

This Order does not resolve the last pending claim and does not close this case.

Honorable Wanda M. Stokes Circuit Court Judge

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