Collateral Release Agreement

Effective as of October 3, 2013, this Collateral Agreement (“Agreement”) is accepted and acknowledged by PCH Financial S.à.r.l. (“PCH”) and Sundance Strategies, Inc (“SSI) collectively referred to as the “Parties”.

WHEREAS, the Parties have entered into (i) the Loan Repayment & Asset Transfer Agreement (the “PCH Transfer Agreement”), executed effective June 5, 2013 and attached hereto as Exhibit “A”, (ii) the Asset Transfer Agreement (the “DMF Transfer Agreement”) executed effective June 5, 2013 and attached hereto as Exhibit “B”, and (iii) the Pledge Agreement (the “PCH Pledge Agreement”) executed effective June 5, 2013 and attached hereto as Exhibit “C”.  Capitalized words used but not defined herein shall have the meanings set forth in the PCH Transfer Agreement;

WHEREAS, PCH transferred certain assets to Del Mar Financial, S.a.r.l. (“DMF”) under the PCH Transfer Agreement (the “Target Assets” or the “Collateral” under any agreement or Exhibit hereto);

WHEREAS, included in the Target Assets was that Secured Promissory Note dated March 11, 2013, in principal amount of U.S.$2,999,000.00 (the “Note”) attached hereto as Exhibit “D”;

WHEREAS, DMF transferred certain of the Target Assets, including the Note, to SSI under the DMF Transfer Agreement;

WHEREAS, SSI is obligated pay to PCH an aggregate amount equal to $1,717,022.37 under Sections 3.2(d) and 3.3 of the DMF Transfer Agreement and under Section 4.2(b) and 4.2(c) of the PCH Transfer Agreement no later than October 3, 2013 (the “Final Payment”);

WHEREAS, pending Final Payment to PCH, certain of the Target Assets and other assets held by SSI were pledged to PCH under the PCH Pledge Agreement;

WHEREAS, certain assets acquired by SSI under the DMF Transfer Agreement, including that Note, were not pledged to PCH under the PCH Pledge Agreement; and

WHEREAS, upon receipt of the Final Payment, PCH shall release all rights it has in an to any of the Target Assets or Collateral or otherwise in which SSI acquired or has any interest in by virtue of any agreement or Exhibit hereto or any exhibit to any agreement hereto, including the Note and any assets secured under the PCH Pledge Agreement, without qualification;

NOW THEREFORE, for good and valuable consideration, the parties agree as follows:

A.

Final Payment.  The Parties acknowledge that SSI owes PCH a Final Payment in the aggregate amount of $1,717,022.37 on October 3, 2013.  

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B.

Release of Collateral.  PCH acknowledges and agrees that effective on the receipt of the Final Payment on or before October 4th, all obligations of SSI to PCH under the PCH Pledge Agreement, the DMF Transfer Agreement and the PCH Transfer Agreement will be deemed to have been paid and satisfied in full in all respects, without qualification, and the SSI will have no further obligations whatsoever with respect to the Target Assets, the Collateral or otherwise, including the Note, or the other assets covered by the PCH Pledge Agreement and all security interests in and liens on any and all assets of the SSI, including, without limitation, the Target Assets, the Collateral and the Note, and the assets listed on Schedule A to the PCH Pledge Agreement, in favor of PCH, shall be terminated and released without recourse and without representation or warranty.  

C.

Miscellaneous.

1.

Binding upon Successors and Assigns. This Agreement shall be binding on and shall inure to the benefit of the Parties and their respective heirs, successors and assigns. The terms and provisions of this Agreement are for the purpose of defining the relative rights and obligations of the Parties with respect to the transactions contemplated hereby.  The Parties may not assign their rights or obligations hereunder without the prior written consent of the other Parties not to be unreasonably withheld.

2.

Further Assurances.  Following the execution hereof, the Parties agree to execute such documents as are reasonably necessary to effect the terms of this Agreement.

3.

Headings. Section headings in this Agreement are included herein for convenience of reference only and shall not constitute a part of this Agreement for any other purpose or be considered in interpreting any provision hereof.

4.

Counterparts; Facsimile and PDF Signatures.  This Agreement may be executed in any number of separate original counterparts and by the different parties on separate counterparts, each of which shall be deemed to be an original, but all such counterparts shall together constitute one Agreement. A party to this Agreement may execute and deliver its signature page hereto by facsimile or by email (pdf file). Each party hereto agrees to be bound by its own facsimile or pdf signature page and to accept, as if it were a fully executed manual signature page, the facsimile or pdf signature page of any other party hereto.

5.

Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of Utah.

Signature Page Follows

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SUNDANCE STRATEGIES, INC.

/s/ Randall Pearson

By: Randall Pearson

Title: President

THE PLEDGEE:  PCH Financial S.à r.l.

/s/Martin Kramer

/s/Benoit Bauduin

By: Martin Kramer

By: Benoit Bauduin

Title: Manager

Title: Manager

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Exhibit “A”

PCH Transfer Agreement

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5 June 2013

PCH Financial S.à r.l.

as Seller

and

DEL MAR FINANCIAL, S.à r.l.

as Buyer

in the presence of

SUNDANCE STRATEGIES, INC.

as the Company

Loan Repayment & Asset Transfer Agreement

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THIS LOAN REPAYMENT AND ASSET TRANSFER AGREEMENT (the “Agreement”) is made on the 5^th day of June, 2013:

BETWEEN

(1)

PCH FINANCIAL S.à.r.l., a société à responsabilité limitée incorporated and existing under the laws of the Grand Duchy of Luxembourg, registered with the Luxembourg Trade and Companies Register under number B 168291, having its registered office at 6, rue Guillaume Schneider, L-2522 Luxembourg (the “Seller”); and

(2)

DEL MAR FINANCIAL S.à r.l., a société à responsabilité limitée incorporated and existing under the laws of the Grand Duchy of Luxembourg, registered with the Luxembourg Trade and Companies Register, having its registered office at 6, rue Guillaume Schneider, L-2522 Luxembourg (the “Buyer”);

IN THE PRESENCE OF

(3)

SUNDANCE STRATEGIES, INC., a corporation incorporated under the laws of the State of Utah, USA, having its registered office at 4626 North 300 West, Suite 365, Provo, Utah 84604, USA (the “Company”).

each a “Party” and together the “Parties” to  this Agreement.

WHEREAS

(A)

The Seller owns the assets (the “Target Assets”) as set forth in Exhibit A; and

(B)

Buyer has borrowed significant funds from Seller (the “Debt”) and Seller has advanced or will advance additional amounts to pay expenses of the Buyer (the “Expenses”) as set forth in Exhibit A-1, as amended and updated from time to time as additional expenses are paid by Seller as provided herein; and

(C)

The Buyer owns the assets (the “Buyer Assets”) as set forth in Exhibit B, most of which have been pledged to secure the Debt; and

(D)

The Company is, concurrently herewith, purchasing certain assets from Buyer (1) that are pledged to Seller and (2) that are being acquired from Seller hereunder (the “Company Purchase”); and

(E)

The Company is taking the assets related to the Company Purchase subject to the obligations of Buyer under this Agreement; and

(F)

The Seller has agreed on behalf of the Buyer to sell certain assets described and designated for third party sale on Exhibit B.  Buyer and Company agree that such assets are to be sold to 3^rd parties and are not subject to any of the transactions considered in this document or the Company Purchase.  

(G)

In accordance with the terms hereof, the Buyer is willing to use the proceeds of the Company Purchase to pay off the Debt and Expenses and buy the Target Assets, and the Seller is willing to sell the Target Assets in connection with the repayment of the Debts and Expenses, effective as of the date of this Agreement (the “Effective Date”).

2

THE PARTIES HEREBY AGREE AS FOLLOWS:

1.

Construction

1.1

In this Agreement, any reference to any agreement (howsoever named) is to such agreement as it may be amended, supplemented or extended from time to time, whether before or after the date hereof.

1.2

Clause headings are for ease of reference only.

1.3

Participating debt certificates (“PDCs”) represent the net insurance benefits (the “NIBs”) from a portfolio of life settlement policies.  The Target Assets and Buyer Assets each include NIBs, as set forth in Exhibit A and Exhibit B (collectively, the “Portfolio”).  Seller has agreed to assist in the conversion of a portion of the Portfolio such that the NIBs on such portion meet the definition of Qualified NIBs as described herein.

1.4

For purposes of this Agreement and any future communications between the Parties, the term “PDCs” and “NIBs” shall be considered interchangeable and all Parties hereby acknowledge and agree to their interchangeability.

2.

Debt Repayment

2.1

The Buyer agrees to repay the Debt and Expenses set forth on Exhibit A-1, as updated from time to time, as described in Section 4, below.  In the event that Seller pays any additional expenses after the Effective Date, so long as such additional expenses have been approved by Buyer and the Company, such amounts shall be included in the Expenses being paid in Section 4, below.  Email approval shall be sufficient for this purpose.

3.

Transfer

3.1

The Seller agrees to sell and transfer to the Buyer, who accepts, all of the Target Assets (as set forth in Exhibit A), such transfer to be effective as of the Effective Date and payable as described in Section 4, below.

4.

Consideration & Payment

4.1

The total consideration from Buyer for repayment of the Debt and Expenses and the transfer of the Target Assets (the “Consideration”) shall be US $6,000,000.00, plus an amount equal to the Expenses, payable partially on the Effective Date and partially upon the satisfaction of the Conversion (defined below).

4.2

The Consideration shall be paid as follows:

(a)

Upon the satisfaction of the Closing Conditions (defined below), the Company, by and on behalf of the Buyer, shall send US $5,000,000.00 in cash by wire transfer for the benefit of Seller’s account pursuant to the wire instructions set forth in Exhibit C (the “Up Front Purchase Price”) and

(b)

An amount equal to the Expenses shall be paid to Sellers on the earlier of (i) the receipt of any reimbursement received in connection with such Expenses, up to the amount of any such reimbursement, (ii) the receipt of any proceeds related to the Target Assets or the Buyer Assets (including death benefits, loan proceeds or sale proceeds), (iii) the completion of the Conversion or (iv) 120

3

days following the Effective Date.  The payment of Expenses shall be secured as described in Section 7 below.

(c)

Upon the earlier of (i) completion of the Conversion or (ii) 120 days following the Effective Date, the Company, by and on behalf of the Buyer, shall send US $1,000,000.00, in cash by wire transfer for the benefit of Seller’s account pursuant to the wire instructions set forth in Exhibit C (the “Conversion Purchase Price”).  The Conversion Purchase Price shall be secured as described in Section 7 below.

5.

Closing Conditions.  The obligations of Buyer to consummate the transactions contemplated by this Agreement are subject to the fulfillment of each of the following conditions (any or all of which may be waived in whole or in part by Buyer):

5.1

Company Note.  The Seller shall deliver to the Company, by and on behalf of the Buyer in connection with the Company Purchase, the Promissory Note issued by Company to Seller in connection with that certain NIB Transfer Agreement dated March 11, 2013, duly endorsed over to Buyer and listed on a Bill of Sale in the form attached hereto in Exhibit D.

5.2

Miscellaneous Notes.  The Seller shall deliver to the Buyer the remaining Promissory Notes issued to the Seller as described on Exhibit A, duly endorsed over to the Buyer and listed on a Bill of Sale in the form attached hereto in Exhibit D.

5.3

Transfer of Policies.  The life insurance policies listed on Exhibit A with policy numbers 159207835 and JJ711646 are each held in a Wisconsin trust, the beneficial interests of which are held by Seller.  Seller shall transfer the beneficial interests in the Wisconsin trusts to Buyer, duly executed by the trustee, pursuant to a Bill of Sale in the form attached hereto in Exhibit D.  

5.4

NIB Registration.  The NIB issuer identified on Exhibit A shall register the Buyer as holder of the NIBs issued by it in its register of NIBs. The Parties expressly grant power to the manager of the NIB issuer, acting individually and with full power of substitution, to amend and execute the above register for and on behalf of the NIB issuer and the Buyer and to do all such acts and things as may be ancillary thereto and/or necessary and/or useful and/or desirable in the sole opinion of such manager in connection with or for the purpose of giving full effect to this Agreement.  Upon amendment and execution of the above register, the manager of the NIB issuer shall cause to be delivered to Buyer via email (to be followed by a hard copy via courier) a copy of such amended and executed register and confirm to Buyer via email (to be followed by a hard copy via courier) that the Buyer has been registered as the holder of the NIBs in its register of NIBs and is entitled to all rights and privileges of such ownership, including the right to transfer or convey such NIBs without further consent of any person, except only as may be limited by this Agreement, the Pledge or the Underlying Documents (as defined below).

5.5

Company Purchase.  The transaction contemplated by this Agreement shall be consummated concurrently with the sale of assets from the Buyer to the Company in accordance with the respective terms and conditions thereof (without the waiver of any terms or conditions thereof) (the “Company Purchase”).  If the Company Purchase agreements are not executed on or prior to the Effective Date, this Agreement shall also be terminated.  

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6.

Conversion

Seller has agreed to assist Buyer in the conversion of certain NIBs into “Qualfied NIBs” for purchase by the Company, as defined in the agreements for the Company Purchase.  Generally, Qualified NIBs are those that meet the pricing criteria of the Company and have 5 year financing for the related life insurance policies and mortality protection insurance coverage.  Seller shall use commercially reasonable efforts to assist Buyer with the conversion of any two NIBs listed on Exhibit A or Exhibit B into Qualified NIBs (the “Conversion”).  Upon the earlier of (a) 120 days following the Effective Date, or (b) the Conversion, Company, for and on behalf of Buyer, shall pay the Conversion Purchase Price to Seller as provided above.

7.

Pledge of Assets.  

Buyer shall receive the Target Assets free from any lien; provided, however, that until the Expenses and Conversion Purchase Price have been paid to Seller, Seller shall retain its lien against the Buyer Assets.  Seller agrees to assist Buyer in the completion of its obligations related to the Company Purchase and to release its lien on an asset by asset basis, as is necessary to satisfy its obligations under the Company Purchase and assist Buyer in generating the funds necessary to pay the Expenses and Conversion Purchase Price; provided, that Seller shall not be required to release any assets unless Seller is satisfied, in its sole discretion, that it is fully secured with respect to any Expenses or Conversion Purchase Price outstanding.  As soon as the total Consideration has been paid, Seller shall fully release all liens and claims against the Buyer Assets.  Furthermore, Company shall enter into a new pledge with Seller to secure outstanding Expenses and Conversion Purchase Price for any assets transferred from Buyer to the Company until such time as those amounts have been fully paid.    Once the Expenses and Conversion Purchase Price has been paid in full and Seller has fully released all liens and claims against the Buyer Assets, Seller shall have no further duties or obligations to the Buyer or the Company.

8.

Representations and Warranties

8.1

The Seller represents and warrants to the Buyer as of the Effective Date as follows:

(a)

The Seller is a validly organized and existing company under the laws of Luxembourg, and it has the corporate power and authority to enter into this Agreement and to perform its obligations hereunder;

(b)

The execution and the performance of this Agreement by the Seller have been duly authorized by its managers and/or any and all other necessary management body(ies) of the Seller and no further corporate action on the part of the Seller is necessary to authorize this Agreement and/or its performance;

(c)

This Agreement has been duly executed by the Seller, and this Agreement constitutes the valid and binding agreement of the Seller, enforceable against it in accordance with the terms hereof;

(d)

To the best of the Seller’s knowledge, the “centre of main interests” (as that term is used in the Council Regulation (EC) N° 1346/2000 of 29 May 2000 on insolvency proceedings, the “Insolvency Regulation”) of the NIB Issuer described on Exhibit A is in Luxembourg, and has no “establishment” (as that term is used in the Insolvency Regulation) outside Luxembourg;

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(e)

In respect of this Agreement and the transactions contemplated by, referred to in or provided for by this Agreement, (i) it entered into this Agreement in good faith and for the purpose of carrying out its business, (ii) it entered into this Agreement on arms’ length commercial term, and (iii) it entered into this Agreement without any intention to defraud or deprive of any legal benefit any other parties (such as third parties and in particular creditors) or to circumvent any applicable mandatory laws or regulations of any jurisdiction;

(f)

To the best of the Seller’s knowledge, no action, petition, resolution or similar order for bankruptcy (faillite), voluntary or judicial winding-up (liquidation volontaire ou judiciaire), controlled management (gestion contrôlée), suspension of payment (sursis de paiement), voluntary arrangement with creditors (concordat préventif de faillite) or similar proceedings affecting the rights of creditors generally has been taken, lodged, passed or presented with regard to the Seller;

(g)

The Seller does not meet or threatens to meet the criteria for the opening of any proceedings referred to under the above paragraph;

(h)

The Seller is the sole beneficial and legal owner of the Target Assets;

(i)

As of the Effective Date, the NIBs described on Exhibit A are validly issued and fully paid up and represent in aggregate one hundred percent (100%) of the NIBs issued by the NIB Issuer; and the Seller is not aware of any document related to the NIBs and the collateral (the “Underlying Documents”) that would preclude the Seller from consummating the transactions contemplated hereunder;

(j)

Upon the delivery of the Target Assets, the Seller shall own the Target Assets free and clear of any lien, security interest, claim, option, pledge, charge, assignment, transfer and other encumbrances of any kind other than preferential rights arising by operation of law;

(k)

As of the Effective Date, each Policy listed on Exhibit A is valid, in-force and in good-standing and has not lapsed nor is in any grace period.

(l)

In respect of this Agreement and the transactions contemplated by, referred to in or provided for by this Agreement, (i) Seller entered into this Agreement in good faith and for the purpose of carrying out their business, and (ii) they entered into this Agreement without any intention to defraud or deprive of any legal benefit any other parties (such as third parties and in particular creditors) or to circumvent any applicable mandatory laws or regulations of any jurisdiction;

(m)

There are no proceedings or litigation at law, equity or otherwise pending or, to the knowledge of the Seller, threatened against the Seller, or to which the Seller is otherwise a party before any Governmental Authority, which, if adversely determined, would reasonably be expected to have a material adverse effect on the ability of the Seller to perform its obligations under this Agreement, or to consummate the transactions contemplated hereby.  The Seller is not subject to any order of any Governmental Authority except to the extent the same would not reasonably be expected to have a material adverse effect on the ability of the Seller to perform its obligations under this Agreement or to consummate the transactions contemplated hereby

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8.2

The Buyer hereby represents and warrants to the Seller as follows:

(a)

The Buyer is a validly organized and existing company under the laws of Luxembourg, and it has the corporate power and authority to enter into this Agreement and to perform its obligations hereunder;;

(b)

The execution and the performance of this Agreement by the Buyer have been duly authorized by its managers and/or any and all other necessary management body(ies) of the Buyer and no further corporate action on the part of the Buyer is necessary to authorize this Agreement and/or its performance;

(c)

This Agreement has been duly executed by the Buyer and this Agreement constitutes the valid and binding agreement of the Buyer, enforceable against it in accordance with the terms hereof;

(a)

The Buyer acknowledges that the Debt and Expenses as valid and owing and agrees to the allocation of the Consideration as set forth on Exhibit E.

(d)

In respect of this Agreement and the transactions contemplated by, referred to in or provided for by this Agreement, (i) it entered into this Agreement in good faith and for the purpose of carrying out its business, (ii) it entered into this Agreement on arms’ length commercial terms and (iii) it entered into this Agreement without any intention to defraud or deprive of any legal benefit any other parties (such as third parties and in particular creditors) or to circumvent any applicable mandatory laws or regulations of any jurisdiction.

(e)

No action, petition, resolution or similar order for bankruptcy (faillite), voluntary or judicial winding-up (liquidation volontaire ou judiciaire), controlled management (gestion contrôlée), suspension of payment (sursis de paiement), voluntary arrangement with creditors (concordat préventif de faillite) or similar proceedings affecting the rights of creditors generally has been taken, lodged, passed or presented with regard to the Buyer; and

(f)

This Agreement does not violate any contractual or other obligation binding upon it.

8.3

The Company hereby acknowledges its understanding of the terms of this Agreement and to the payment of the Consideration as set forth herein in conjunction with the Company Purchase; provided that the Company and Seller shall owe no duties to each other beyond the Seller’s duties to provide certain assistance to the Buyer in connection with the Company Purchase as described herein and the Company’s duty to make certain payments related to the Company Purchase directly to Seller.    

9.

Right to Set-off

If Buyer obtains a final, non-appealable judgment from a court of competent jurisdiction against Seller for any violation of the representations and warranties in Section 7.1 (“Seller’s Violation”), the Buyer shall have right to set-off any amounts Seller is obligated to pay Buyer pursuant to such final, non-appealable judgment against amounts due to Seller under this Agreement, including but not limited to what is owed under the Promissory Note (“Set-Off”).  Such election to set-off costs associated with curing Seller’s Violation shall not be construed as a waiver of any

$1,000,000³

Note