Notes not in integral multiples of $25.00 resulting from the exercise of the over-subscription privilege will be eliminated by rounding down to the nearest integral multiple of $25.00, with the total subscription payment being adjusted accordingly.

What are the material terms of the notes?

The notes will be unsecured and issued in minimum denominations of $25.00 per note and in integral multiples of $25.00 in excess thereof. The notes are not convertible into shares of our common stock. The notes will bear interest at an annual rate equal to         %. Interest is payable         on of each year. We may redeem the notes, in whole or in part, at any time after the anniversary of the date of issuance of the notes for         , pluspay accrued and unpaid interest on all such existing notes so tendered and accepted for exchange through and excluding the settlement date of the Offer to Exchange.

The Notes were issued pursuant to an indenture (the “New Convertible Note Indenture”) between the redemption date.Company and U.S. Bank, National Association, as indenture trustee. The notesNew Convertible Note Indenture provides, among other things, that the Notes are unsecured senior obligations of the Company and will mature yearson February 15, 2023. The Notes bear interest at a rate of 5.00% per annum from the issue date, payable semi-annually in arrears on August 15 and February 15 of issuance.each year, beginning on August 15, 2017.

 serves as indenture trustee with respect to the notes pursuant to the terms

Holders of the Indenture, a copy of which is filed as an exhibit to our registration statement. See “Description of     % Senior Unsecured Notes Due             ” included in this prospectus for a complete description of the notes.

Am I required to exercise all of the rights I receive in this rights offering?

No. You may exerciseconvert their Notes at their option on any number of your subscription rights or you may choose to transfer or not exercise any subscription rights.

Are the subscription rights transferable?

The subscription rights are transferable until the expiration date, although we cannot assure you that a market will develop or be maintained for the subscription rights. Although no assurance can be given that a market for the subscription rights will develop, trading in the subscription rights will begin on a when-issued basis and may be conducted until the close of trading on the last trading day prior to the expiration date, such period to be no less than 20 days. The value of the subscription rights, if any, will be reflected by the market price. We will not be responsible if subscription rights cannot be sold and we have not guaranteed any minimum sales price for the subscription rights.

Is the Company entering into any standby purchase agreement with respect to the purchase of notes not subscribed for in this rights offering or any agreement with any shareholder regarding the exercise of rights granted to them in this rights offering?

No. We are not entering into any standby purchase agreement or similar agreement with respect to the purchase of any notes not subscribed for through the exercise by our shareholders of the basic subscription privilege or the over-subscription privilege. In addition, we are not entering into any agreements with any of our existing shareholders pursuant to which they have agreed to exercise any rights granted to them pursuant to this rights offering. Therefore, there is no certainty that any notes will be purchased pursuant to this rights offering and there is no minimum purchase requirement as a condition to accepting subscriptions.

Has our board of directors made a recommendation to our shareholders regarding the exercise of rights under this rights offering?

No. Although we expect that some or all of our directors may participate in this rights offering, our board of directors is making no recommendation regarding your exercise of the subscription rights. Shareholders who exercise their subscription rights risk investment loss on their investment. You are urged to make your decision based on your own assessment of our business and this rights offering. Please see “Risk Factors” beginning on page 16 of this prospectus for a discussion of some of the risks involved in investing in our notes.

Why are we conducting this rights offering?

The purpose of this rights offering is to raise funds to make selective investments in the life settlement asset class, to pay the premiums on certain life insurance policies that we own and for general corporate purposes, including working capital. If all of the rights are exercised, the total purchase price of the notes offered in this rights offering would be $              million.

How soon must I act to exercise my rights?

If you received a subscription form and elect to exercise any or all of your subscription rights, the subscription agent must receive your completed and signed subscription form and payment prior to the expiration of this rights offering, which is                     , 2013, at 5:00 p.m., New York City time. If you hold your shares in the name of a custodian bank, broker, dealer or other nominee, your custodian bank, broker, dealer or other nominee may establish a deadline prior to 5:00 p.m. New York City time, on                     , 2013 by which you must provide it with your instructions to exercise your subscription rights and pay for your notes.

Although we will make reasonable attempts to provide this prospectus to holders of subscription rights, this rights offering and all subscription rights will expire at 5:00 p.m., New York City time on                     , 2013 (unless extended), whether or not we have been able to locate each person entitled to subscription rights. Although we have the option of extending the expiration of this rights offering, we do not have the obligation to do so and currently do not intend to do so.

Are we requiring a minimum subscription to complete this rights offering?

No. There is no minimum subscription requirement in this rights offering. However, our board of directors reserves the right to cancel this rights offering for any reason, including if our board of directors believes that there is insufficient participation by our shareholders. If this rights offering is cancelled, all subscription payments received by the subscription agent will be returned promptly without interest.

Can the board of directors cancel, terminate, amend or extend this rights offering?

Yes. We have the option to extend this rights offering and the period for exercising your subscription rights, although we are not obligated to do so and do not presently intend to do so. Our board of directors may cancel this rights offering at any time for any reason. If this rights offering is cancelled, all subscription payments received by the subscription agent will be returned promptly without interest.

Our board of directors reserves the right to amend or modify the terms of this rights offering at any time, for any reason, including, without limitation, in order to increase participation in this rights offering. Such amendments or modifications may include a change in the subscription price although no such change is presently contemplated. If we should make any fundamental changes to the terms set forth in this prospectus, we will file a post-effective amendment to the registration statement in which this prospectus is included, and recirculate an updated prospectus after the post-effective amendment is declared effective with the SEC. Potential purchasers who have subscribed will have the right to cancel such subscriptions and receive a refund of any money advanced by such shareholder. In addition, upon such event, we may extend the expiration date of

this rights offering to allow holders of rights ample time to make new investment decisions and for us to recirculate updated documentation. Promptly following any such occurrence, we will issue a press release announcing any changes with respect to this rights offering and the new expiration date. The terms of this rights offering cannot be modified or amended after the expiration date of this rights offering.

When will I receive my subscription form?

Promptly after the date of this prospectus, the subscription agent will send a subscription form to each registered holder of our common stock as of the close of business on the recordsecond scheduled trading day immediately preceding February 15, 2023. Upon conversion, the Company will deliver shares of Common Stock, together with any cash payment for any fractional share of Common Stock. The initial conversion rate for the Notes will be (x) 500 shares of Common Stock per $1,000 principal amount of Notes (for Notes denominated in $1,000 increments) and (y) 0.5 shares of Common Stock per $1.00 principal amount of Notes (for Notes denominated in $1.00 increments). The conversion rate is subject to adjustment in certain circumstances.

8.50% Senior Unsecured Convertible Notes

As of July 28, 2017, as a consequence of the closing of the Exchange Offer, $1,194,000 of the Company’s 8.50% Senior Unsecured Convertible Notes due 2019 (the “Old Convertible Notes”) remain outstanding.  The maturity date based on our shareholder registry maintainedof the Old Convertible Notes is February 15, 2019. The Old Convertible Notes accrue interest at the transfer agent for our common stock. If you hold yourrate of 8.50% per annum on the principal amount of the Old Convertible Notes, payable semi-annually in arrears on August 15 and February 15 of each year. The Old Convertible Notes are convertible into shares of common stock throughour Common Stock at any time prior to the close of business on the second scheduled trading day immediately preceding the maturity date of the Old Convertible Notes.  Initially, the Old Convertible Notes were convertible into shares of Common Stock at a broker, dealer, custodian bankconversion rate of 147.9290 shares of Common Stock per $1,000 principal amount of Old Convertible Notes.  In the second quarter of 2015, the conversion rate was adjusted to 151.7912 shares of Common Stock per $1,000 principal amount of Old Convertible Notes in connection with an anti-dilution adjustment triggered by a rights offering that resulted in the issuance of 6,688,433 shares of Common Stock.

THE PRIVATE PLACEMENTS AND EXCHANGE OFFER

The securities offered from time to time pursuant to this prospectus and any prospectus supplement and post-effective amendment, if any, in connection herewith consist of: (i) up to an aggregate of 207,918,483 shares of our Common Stock which include (a) 115,000,000 shares issued in the Private Placement pursuant to that certain Common Stock Purchase Agreement, dated July 28, 2017, (b) an aggregate of 42,500,000 Warrant Shares issuable upon exercise of Warrants with a strike price of $0.20 per Warrant Share, (c)  37,918,483 shares of Common Stock issuable upon conversion of the Notes at an initial conversion rate of (x) 500 shares of Common Stock per $1,000 principal amount of the Notes and (y) 0.5 shares of Common Stock per $1.00 principal amount of Notes, each subject to adjustment in certain circumstances, and (d) 12,500,000 shares issued in the Additional Private Placement pursuant to that certain Securities Purchase Agreement, dated August 11, 2017; and (ii) up to $75,836,966 in aggregate principal amount of our Notes, which Notes include (a) $72,238,000 unrestricted $1,000 denominated Notes exchanged in the Exchange Offer pursuant to Rule 3(a)(9) for the Company’s previously registered $1,000 denominated 8.50% senior unsecured notes due 2019 and (b) $3,598,966 restricted $1.00 denominated Notes exchanged in the Exchange Offer pursuant to Rule 3(a)(9) for the Company’s previously privately issued $1.00 denominated 8.50% senior unsecured notes due 2019.

The Master Transaction Agreements

On or about March 15, 2017, and May 12, 2017, we entered into a series of separate master transaction agreements by and among the Company, PJC Investments, LLC, a Texas limited liability company (“PJC”), and each consenting holder of our 8.50% Senior Unsecured Convertible Notes that is a party to them (the “Consenting Holders”) regarding a series of integrated transactions with the intent to effect a recapitalization of the Company which we refer to throughout this prospectus as the Transactions (collectively, and as amended, the “Master Transaction Agreements”). The Master Transaction Agreements required us to, among other nominee, you will not receive an actual subscription form. Instead,things, enter into a

Common Stock Purchase Agreement, the Exchange Offer, a New Convertible Note Indenture providing for the issuance of the Notes, a Senior Note Exchange Offer, a New Senior Note Indenture providing for the issuance of New Senior Notes, a Senior Note Purchase Agreement, Warrants and certain other agreements and documents (each as describeddefined herein or in the Master Transaction Agreements, and together with the Master Transaction Agreements, the “Transaction Documents”). The Transactions closed on July 28, 2017.

The Common Stock Purchase Agreement

In conjunction with the consummation of the Transactions, on July 28, 2017, we entered into a Common Stock Purchase Agreement (the “Purchase Agreement”) by and between the Company and certain investors identified in this prospectus you must instruct your broker, bank or nominee whether or notunder the caption “Selling Stockholders,” whereby we issued and sold 115,000,000 shares of Common Stock for a purchase price of $23.0 million.

The Common Stock Purchase Warrants

In conjunction with the consummation of the Transactions, on July 28, 2017, we issued eight-year Common Stock Purchase Warrants (the “Warrants”) to exercisecertain investors identified in this prospectus under the caption “Selling Stockholders,” to purchase up to 42,500,000 shares of Common Stock at a per share price of $0.20, with 41% of the shares being immediately exercisable and the remaining shares exercisable upon reaching certain milestones related to the conversion of the Notes.

Exchange Offer

In conjunction with the consummation of the Transactions, on July 28, 2017, we issued $75,836,966 in Notes to certain Selling Stockholders as consideration for tendering into the Exchange Offer.  The Notes are governed by the terms and conditions of the New Convertible Note Indenture.  The New Convertible Note Indenture provides that the Company will file a registration statement with the SEC covering the resale of the Notes, and the Common Stock issuable upon conversion of the Notes, within 30 days after the last date on which any Notes are originally issued under the New Convertible Note Indenture.  The registration statement, of which this prospectus is a part, has been filed in accordance with the New Convertible Note Indenture.

Registration Rights Agreement

In conjunction with the consummation of the Transactions, we entered into a Registration Rights Agreement with certain Selling Stockholders, dated as of July 28, 2017 (the “Registration Rights Agreement”), pursuant to which we agreed to file a registration statement with the SEC covering the resale of the shares of Common Stock sold in the Private Placement and underlying the Warrants. We agreed to file such registration statement within 60 days of the closing of the Transactions. The Registration Rights Agreement includes customary indemnification rights on your behalf. If you wish to obtainin connection with the registration statement. The registration statement, of which this prospectus is a separate subscription form, you should promptly contact your broker, bank or other nomineepart, has been filed in accordance with the Registration Rights Agreement.

The foregoing summary descriptions of the Purchase Agreement, the Warrants, the Notes and request a separate subscription form. It is not necessary to have a physical subscription form to elect to exercise your rights.

What happens if I choose not to exercise my subscription rights?

Shareholders whothe Registration Rights Agreement do not exercisepurport to be complete and are qualified in their subscription rights will lose any value that may be representedentirety by reference to the rights. If youfull text of such documents, which were filed as exhibits to our Form 8-K, dated August 1, 2017 and are incorporated by reference herein.

The Additional Private Placement

On August 11, 2017, the Company entered into a Securities Purchase Agreement (the “Securities Purchase Agreement”) by and between the Company and a certain investor identified in this prospectus under the caption “Selling Stockholders,” whereby, among other things, we issued 8,750,000 shares of Common Stock on August 11, 2017 and 3,750,000 shares of Common Stock on August 14, 2017 (the “Additional Shares”) for an aggregate purchase price of $5.0 million.

In connection with the Securities Purchase Agreement, on August 11, 2017, the Company entered into a Registration Rights Agreement with a certain Selling Stockholder (the “Additional Registration Rights Agreement”),

pursuant to which the Company is required to register the resale of the Additional Shares. The Additional Registration Rights Agreement is substantially similar to the Registration Rights Agreement entered into in connection with the consummation of the Transactions.

The foregoing summary descriptions of the Securities Purchase Agreement and the Additional Registration Rights Agreement do not exercise any subscription rights,purport to be complete and are qualified in their entirety by reference to the full text of such documents, which were filed as exhibits to our Quarterly Report on Form 10-Q for the quarter ended June 30, 2017, and are incorporated by reference herein.

Principal Executive Offices

Our office is located at 5355 Town Center Road, Suite 701, Boca Raton, Florida 33486, and our telephone number is (561) 995-4200.

THE OFFERING

The number of shares of our common stock will not change.shown above to be outstanding immediately after this offering is based on 156,505,118 shares outstanding as of September 13, 2017, and excludes, as of such date:

How do I·                  an aggregate of 605,227 shares of our Common Stock issuable upon the exercise my subscription rights if I own shares in certificate form?

If you hold shares evidenced by one or more share certificates and you wish to participate in this rights offering, you must take the following steps:of options outstanding as of September 13, 2017, having a weighted-average exercise price of $8.66 per share;

Please follow the payment and delivery instructions accompanying the subscription form. Do not deliver documents to us. You are solely responsible for completing delivery to the subscription agent of your subscription documents, subscription form and payment. We urge you to allow sufficient time for delivery of your subscription materials to the subscription agent so that they are received by the subscription agent by 5:00 p.m., New York City time, on , 2013. We are not responsible for subscription materials sent directly to our offices.

If you send a payment that is insufficient to purchase the number of notes you requested, or if the number of notes you requested is not specified in the forms, the payment received will be applied to exercise your subscription rights to the full extent possible based on the amount of the payment received. Any excess subscription payments received by the subscription agent will be returned promptly, without interest, following the expiration of this rights offering.

What form of payment is required to purchase notes in this rights offering?

Payments submitted to the subscription agentclass action litigation settlement arising in connection with this rights offering must be made in full, in United States currency, in immediately available funds,the investigation by certified bank, cashiers check or wire transferthe U.S. Attorney’s Office for District of New Hampshire into the Company’s now legacy premium finance business with an exercise price of $10.75 and a term of five years from the date they were distributed to American Stock Transfer & Trust Company, LLC, as subscription agent, f/b/o Imperial Holdings, Inc., drawn upon a United States bank. You may not remit personal checks of any type.

What should I do if I want to participate in this rights offering, but my shares are held in the name of my broker, dealer, custodian bank or other nominee?

If you hold your·                  608,000 shares of commonour Common Stock held as treasury stock inas of September 13, 2017; and

·                  11,561,558 shares of our Common Stock reserved for future issuance under our equity incentive plan.

RATIO OF EARNINGS TO FIXED CHARGES

Emergent Capital, Inc.

CONSOLIDATED RATIO OF EARNINGS TO FIXED CHARGES FOR FISCAL YEARS 2012 THROUGH 2016

AND FOR THE SIX MONTHS ENDED JUNE 30, 2017 (ACTUAL AND PRO FORMA)

(1)                                 The ratio of earnings to fixed charges is computed by dividing earnings by fixed charges. The term “fixed charges” means the namesum of a broker, dealer, custodian bank orthe following: (a) interest expenses and capitalized interest, (b) amortized premiums, discounts and capitalized expenses related to indebtedness, (c) other nominee, then your broker, dealer, custodian bank or other nomineeexpenses related to indebtedness, and (d) an estimate of the interest within rental expense. The term “earnings” is the record holder ofamount resulting from adding the shares you own. You will not receive a subscription form. The record holder must exercise the subscription rights on your behalffollowing: (a) pre-tax income from continuing operations before adjustment for the notes you wish to purchase.

If you wish to purchase notes through this rights offering, please promptly contact your broker, dealer, custodian bank or other nominee as record holder of your shares. We will ask your record holder to notify you of this rights offering, but we are not responsible for the failure of your record holder to contact you. If you are not contacted by your record holder, you should promptly initiate contact with that intermediary to ensure that you will have an opportunity to participate in this rights offering. Your record holder may establish a deadline prior to the 5:00 p.m. New York City time on                 , 2013, which we established as the expiration date of this rights offering.

When will I receive my notes?

If you purchase notes in this rights offering by submitting a subscription form and payment, your notes will be issued as soon as practicable after the completion of this rights offering. The notes will be issued only in book-entry form through the facilities of DTC and will be in denominations of $25.00 and integral multiples of $25.00 in excess thereof. The notes will be represented by a Global Security (the “Global Security”) and will be registered in the name of a nominee of DTC. Until your notes have been issued, you may not be able to sell the notes acquired in this rights offering.

After I send in my payment and subscription form, may I change or cancel my exercise of rights?

No. All exercises of subscription rights are irrevocable, even if you later learn information that you consider to be unfavorable to the exercise of your subscription rights. However, if we amend this rights offering to allow for an extension of this rights offering for a period of more than 30 days or make a fundamental change to the terms set forth in this prospectus, you may cancel your subscription and receive a refund of any money you have advanced. You should not exercise your subscription rights unless you are certain that you wish to purchase the notes.

Are there risks in exercising my subscription rights?

Yes. The exercise of your subscription rights involves risks. Among other things, you should carefully consider the risks described under the heading “Risk Factors” beginning on page 16 of this prospectus and the additional risks identified in the documents and reports incorporated by reference in this prospectus.

If this rights offering is not completed, will my subscription payment be refunded to me?

Yes. The subscription agent will hold all funds it receives in a segregated bank account until completion of this rights offering. If this rights offering is not completed, all subscription payments received by the subscription agent will be returned promptly without interest. If you own shares through a broker, dealer, custodian bank or other nominee, it may take longer for you to receive payment because the subscription agent will return payments through the record holder of your shares. In such an event, you should contact the record holder directly to determine when the funds will be returned to you and to ensure that your account has been properly credited.

Will the rights and notes be listed on a stock exchange or national market?

The subscription rights are transferable. We do not plan to list the subscription rights on any stock exchange and we have no way of knowing whether a market will develop or be maintained for the subscription rights. We intend to file an application to list the notes on the NASDAQ Global Market under the symbol “        ” but we cannot assure you that the notes will be listed for trading or that a liquid market for our rights or our notes will develop. The notes are expected to trade “flat,” meaning that the purchasers will not pay and sellers will not

receive any accrued and unpaid interest on the notes that is not included in the trading price. Shares of our common stock are traded on the NYSE under the symbol “IFT.”

How do I exercise my rights if I live outside the United States?

We will not mail this prospectus or the subscription forms to shareholders whose addresses are outside the United States or who have a military or diplomatic post office or foreign post office address. The subscription agent will hold subscription forms for their account. To exercise subscription rights, our shareholders with addresses outside the United States must notify the subscription agent and timely follow other procedures as described herein.

What fees or charges apply if I purchase the notes?

We are not charging any fee or sales commission to issue subscription rights to you or to issue notes to you if you exercise your subscription rights. If you exercise your subscription rights through your broker, dealer, custodian bank or other nominee, you are responsible for paying any fees your intermediary may charge you.

What are the material United States federal income tax consequences of exercising my subscription rights?

For United States federal income tax purposes, you should not recognize income or loss upon receiptfrom equity investees; (b) fixed charges; (c) amortization of capitalized interest; (d) distributed income of equity investees; and (e) share of pre-tax losses of equity investees for which charges arising from guarantees are included in fixed charges; then subtracting from the total added items, the following: (a) interest capitalized and (b) the non-controlling interest in pre-tax income of subsidiaries that have not incurred fixed charges.

(2)                                 In 2016, 2015, 2014, and 2012, we incurred losses from operations, and as a result, our earnings were insufficient to cover our fixed charges by $49,429,000, $39,099,000, $5,026,000 and $42,058,000, respectively.

(3)                                 Pro forma for the six months ended June 30, 2017 and year ended December 2016 shows losses from operations, and as a result, our earnings were insufficient to cover our fixed charges by $15,031,000 and $65,781,000, respectively.

(4)                                 Earnings include net realized and unrealized gains or exerciselosses. Net realized and unrealized gains or losses can vary substantially from period to period. Please refer to our annual report on Form 10-K for the year ended December 31, 2016 for additional information.

(5)                                 The fixed charges used for purposes of calculating the ratio of earnings to fixed charges excludes change in fair value of the subscription rights. However, you should consult your tax advisor as to your particular tax consequences resulting from this rights offering.

To whom should I send my forms and payment?

If your shares are held in the name of a broker, dealer or other nominee, then you should send your subscription documents to the record holder following their instructions. If you received a subscription form with this prospectus and wish to purchase notes during this rights offering, you should send your properly completed and signed subscription form, any other subscription documents and payment by hand delivery, first class mail or courier service to the subscription agent, American Stock Transfer & Trust Company, LLC,our revolving credit facilities (which at the following address:relevant times included the White Eagle and Red Falcon credit facilities, loss on extinguishment of debt and change in fair value of conversion derivative liability. For the years ended December 31, 2016, 2015, 2014 and 2013, the change in fair value of such revolving credit facilities was ($1.9 million), $12.2 million, ($5.5 million) and ($9.4 million), respectively. For the year ended December 31, 2016, 2015 and 2013, the loss on extinguishment of debt was $554,000, $8.8 million and $4.0 million, respectively. For the year ended December 31, 2014, change in fair value of conversion derivative liability was $6.8 million. Calculation for the pro forma for the six months ended June 30, 2017 and the year ended December 31, 2016 period excludes loss on extinguishment of debt of $10.0 million and $12.2 million, respectively.

RISK FACTORS

You are solely responsible for completing delivery to the subscription agent of your subscription materials. The subscription materials are to be received by the subscription agent on or prior to 5:00 p.m., New York City time, on                     , 2013. We urge you to allow sufficient time for delivery of your subscription materials to the subscription agent.

Whom should I contact if I have other questions?

If you have other questions or need assistance, please contact the information agent, AST Phoenix Advisors, at (877) 478-5038 or (212) 493-3910. For questions regarding your account and/or lost shares, please contact American Stock Transfer & Trust Company, LLC at (877) 248-6417 or (718) 921-8317.

RISK FACTORS

Investing in our securities involves a high degree of risk. You should carefully consider the specific risks described below as well as the risks described in our annual report on Form 10-K for the year ended December 31, 20122016 and our subsequently filed quarterly reports on Form 10-Q, which are incorporated by reference herein, together with the other information set forth or incorporated by reference in this prospectus and any accompanying prospectus supplement, before making an investment decision. Any of the risks we describe below or in the information incorporated herein by reference could cause our business, financial condition, or operating results to suffer. You could lose all or part of your investment. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition, or operating results. Some of the statements in this section of the prospectus are forward-looking statements. For more information about forward-looking statements, please see the section of this prospectus entitled “Cautionary Note Regarding Forward-Looking Statements.”

Risks Related to this Rights Offering

If we terminate this offering for any reason, we will have no obligation other than to return subscription monies as soon as practicable.

We may decide, in our sole discretion and for any reason, to cancel or terminate the rights offering at any time prior to the expiration date. If this offering is cancelled or terminated, we will have no obligation with respect to subscription rights that have been exercised except to return as soon as practicable, without interest, the subscription payments deposited with us. If we terminate this offering and you have not exercised any subscription rights, such subscription rights will expire worthless. In addition, if you purchased subscription rights on the open market, such subscription rights may expire worthless.

If you do not act promptly and follow the subscription instructions, your exercise of subscription rights may be rejected.

Shareholders who desire to purchase notes in this rights offering must act promptly to ensure that all required forms and payments are actually received by the subscription agent before , 2013, the expiration date of this rights offering, unless extended by us. If you are a beneficial owner of shares, but not a record holder, you must act promptly to ensure that your broker, bank, custodian or other nominee acts for you and that all required forms and payments are actually received by the subscription agent before the expiration date of this rights offering. We will not be responsible if your broker, bank, custodian, or other nominee fails to ensure that all required forms and payments are actually received by the subscription agent before the expiration date of this rights offering. If you fail to complete and sign the required subscription forms, send an incorrect payment amount or otherwise fail to follow the subscription procedures that apply to your exercise in this rights offering, the subscription agent may, depending on the circumstances, reject your subscription or accept it only to the extent of the payment received. Neither we nor our subscription agent undertakes to contact you concerning an incomplete or incorrect subscription form or payment, nor are we under any obligation to correct such forms or payment. We have the sole discretion to determine whether a subscription exercise properly follows the subscription procedures.

We may use the proceeds of this rights offering in ways with which you may disagree.

We intend to use the proceeds from this rights offering to make selective investments in the life settlement asset class, to pay the premiums on certain life insurance policies that we own and for general corporate purposes, including working capital. Accordingly, we will have significant discretion in the use of the proceeds of this offering, and it is possible that we may allocate the proceeds differently than investors in this offering desire, or that we will fail to maximize our return on these proceeds. You will be relying on the judgment of our management with regard to the use of the proceeds from the rights offer, and you will not have the opportunity, as part of your investment decision, to assess whether the proceeds are being used appropriately.

We are not entering into any agreements that would obligate our existing shareholders to exercise the rights granted to them in this rights offering or obligate any other party to purchase notes not subscribed for in this rights offering, so there is no guarantee that any notes will be purchased in this rights offering.

We are not entering into any standby purchase agreement or similar agreement with respect to the purchase of any notes not subscribed for through the exercise by our shareholders of the basic subscription privilege or the over-subscription privilege. In addition, we are not entering into any agreements with any of our existing shareholders pursuant to which they have agreed to exercise any rights granted to them pursuant to this rights offering. Therefore, there is no certainty that any notes will be purchased pursuant to this rights offering and there is no minimum purchase requirement as a condition to accepting subscriptions. As a result, if you exercise your basic subscription privilege or the over-subscription privilege, you may be investing in a company that continues to need additional capital.

You may not receive all of the notes for which you subscribe pursuant to the over-subscription privilege.

Shareholders who fully exercise their basic subscription rights will be entitled to subscribe for an additional notes that are not purchased by our other holders through the exercise of their basic subscription rights. Over-subscription rights will be allocated pro-rata among shareholders who over-subscribed, based on the principal amount of notes subscribed for and elected to purchase pursuant to the basic subscription privilege. You may not receive any or all of the amount of notes for which you over-subscribed. If the prorated amount of notes allocated to you in connection with your over-subscription right is less than your over-subscription request, then the excess funds held by us on your behalf will be returned to you, without interest, as soon as practicable after the rights offering has expired and all prorating calculations and reductions contemplated by the terms of the rights offering have been effected, and we will have no further obligations to you.

If you make payment of the subscription price by uncertified check, your check may not clear in sufficient time to enable you to purchase notes in this rights offering.

Any uncertified check used to pay for notes to be issued in this rights offering must clear prior to the expiration date of this rights offering, and the clearing process may require five or more business days. If you choose to exercise your subscription rights, in whole or in part, and to pay for the notes by uncertified check and your check has not cleared prior to the expiration date of this rights offering, you will not have satisfied the conditions to exercise your subscription rights and will not receive the notes you wish to purchase.

The receipt of rights may be treated as a taxable dividend to you.

The distribution of the rights in this offering should be a non-taxable stock dividend under Section 305(a) of the Internal Revenue Code of 1986, as amended, or the Code. This position is not binding on the IRS, or the courts, however. If this offering is part of a “disproportionate distribution” under Section 305 of the Code, your receipt of rights in this offering may be treated as the receipt of a distribution equal to the fair market value of the rights. Any such distribution would be treated as dividend income to the extent of our current and accumulated earnings and profits, with any excess being treated as a return of capital to the extent thereof and then as capital gain.

Risks Related to the % Senior Unsecured Notes Due

No market currently exists for the notesNotes and an active trading market may not develop.

The notesNotes are a new issue of securities with no established trading market. We intend to apply for listing of the notes on the NASDAQ Global Market, but there can be no assurance that the notes will be approved for listing. Even if the listing of the notes on NASDAQ Global Market is approved,market and we cannot assure you that a market will develop or that you will be able to sell your notesNotes easily.

The liquidity of any market for the notesNotes will depend upon various factors, including:

Accordingly, we cannot assure you that an active trading market will develop for the notes.Notes. If the notesNotes are traded, after their initial issuance, they may trade at a discount from their initial offering price, depending upon prevailing interest rates and other factors, including those listed above.

We may not have sufficient funds to pay our debt and other obligations.

Our cash, cash equivalents, short-term investments and operating cash flows may be inadequate to meet our obligations under the notes or our other obligations. In addition, we are not able to borrow money under our Revolving Credit Facility to pay interest or principal on the notes. If we are unable to generate sufficient cash flow or otherwise obtain funds necessary to make required payments on the notes, we will be in default under the notes, which could cause defaults under any other of our indebtedness then outstanding. Any such default would have a material adverse effect on our business, prospects, financial condition and operating results. There may be other events that could hurt our financial condition that would not entitle you to have your notes repurchased by us.

The notesNotes will be effectively subordinated to the payments required under the White Eagle Revolving Credit Facility as well as any secured debt incurred in the future and the cash generated from the policies securing the White Eagle Revolving Credit Facility may not be used to pay the notes.Notes.

The lenders under our White Eagle Revolving Credit Facility may foreclose on the life insurance policies securing the facility in the event of any default under the facility and any cash generated from such policies will generally not be available to us to repay the notes.Notes. Accordingly, we may not be able to repay the notesNotes even if we experience a high number of mortalities from the insureds under the life insurance policies securing the revolving credit facility.White Eagle Revolving Credit Facility. In the event of our bankruptcy, liquidation or similar proceeding, the lenders under the White Eagle Revolving Credit Facility will be entitled to proceed against life insurance policies securing the facility and any other secured lenders will be entitled to proceed against the assets securing such debt, and such collateral will not be available for payment of our unsecured debt, including the notes.Notes. As a result, the notesNotes will be effectively subordinated to our White Eagle Revolving Credit Facility and any future secured debt to the extent of the value of the collateral securing such future secured debt. In addition, because we are a holding company which conducts substantially all of our operations through our subsidiaries, the right of us, and therefore the right of creditors of ours, including the holders of the notes,Notes, to participate in any distribution of the assets of any subsidiary

upon its liquidation or reorganization or otherwise is subject to the prior claims of creditors of the subsidiary, except to the extent that claims of us as a creditor of the subsidiary may be recognized.

The indenture under which the notes will be issued will containNew Convertible Note Indenture contains limited protection for holders of the notes.Notes.

The indenture under which the notes will be issuedNew Convertible Note Indenture offers limited protection to holders of the notes.Notes. The terms of the indentureNew Convertible Note Indenture and the notesNotes do not restrict our or any of our subsidiaries’ ability to engage in, or otherwise be a party to, a variety of corporate transactions, circumstances or events that could have a material adverse impact on your investment in the notes.Notes. In particular, the terms of the indentureNew Convertible Note Indenture do not place any restrictions on our or our subsidiaries’ ability to:

ours that is guaranteed by one or more of our subsidiaries and which therefore is structurally senior to the notes and (4) securities, indebtedness or obligations issued or incurred by our subsidiaries that would be senior to our equity interests in our subsidiaries and therefore rank structurally senior to the notes ours that is guaranteed by one or more of our subsidiaries and which therefore is structurally senior to the Notes and (4) securities, indebtedness or obligations issued or incurred by our subsidiaries that would be senior to our equity interests in our subsidiaries and therefore rank structurally senior to the Notes with respect to the assets of our subsidiaries;

In addition, the indentureNew Convertible Note Indenture will notonly require us to offer to purchase the notesNotes in connection with a change of control or any other event.fundamental change.

Furthermore, the terms of the indentureNew Convertible Note Indenture and the notesNotes do not protect holders of the notesNotes in the event that we experience changes (including significant adverse changes) in our financial condition, results of operations or credit ratings, if any, as they do not require that we or our subsidiaries adhere to any financial tests or ratios or specified levels of net worth, revenues, income, cash flow or liquidity.

Our ability to recapitalize, incur additional debt and take a number of other actions that are not limited by the terms of the notesNotes may have important consequences for you as a holder of the notes,Notes, including making it more difficult for us to satisfy our obligations with respect to the notesNotes or negatively affecting the trading value of the notes.Notes.

Other debt that we may issue or incur in the future could contain more protections for its holders than the indentureNew Convertible Note Indenture and the notes,Notes, including additional covenants and events of default. The issuance or incurrence of any such debt with incremental protections could affect the market for and trading levels and prices of the notes.Notes.

We may be unable to deduct interest payments on debt that is attributed to policies that we own, which would reduce any future income and cash flows available for the payment of interest.

Generally, under the Internal Revenue Code of 1986, as amended, interest paid or accrued on debt obligations is deductible in computing a taxpayer’s federal income tax liability. However, when the proceeds of indebtedness are used to pay premiums on life insurance policies that are owned by the entity incurring the debt or otherwise used to support the purchase or ownership of life insurance policies, the interest in respect of such proceeds is not deductible. Accordingly, so long as we use a portion of debt financing to pay the premiums on policies owned by us or to support the continued ownership of life insurance policies by us, the interest paid or accrued on that portion of the debt will not be deductible by us for federal income tax purposes. Although we have net operating losses, or NOLs, that we may be able to use to reduce a portion of our future taxable income, the inability to deduct interest accrued on debt could have a material adverse effect on our future earnings and cash flows available for the payment of interest. We are exploring alternatives that would permit us to own our policies in a more tax-advantaged manner.

The notes do not require us to achieve or maintain minimum financial results, the lack of which could negatively impact holders of the notes.

The notes do not require us to achieve or maintain any minimum financial results relating to our financial condition or results of operations. Our ability to recapitalize and take a number of other actions that are not

limited by the terms of the indenture and the notes could have the effect of diminishing our ability to make payments on the notes when due.

The notes are not rated and the issuance of a credit rating could adversely affect the market price of the notes.

At their issuance, the notes will not be rated by any credit rating agency. Following their issuance, the notes may be rated by one or more of the credit rating agencies. If the notes are rated, the rating could be lower than expected, and such a rating could have an adverse effect on the market price of the notes. Furthermore, credit rating agencies revise their ratings from time to time and could lower or withdraw any rating issued with respect to the notes. Any real or anticipated downgrade or withdrawal of any ratings of the notes could have an adverse effect on the market price or liquidity of the notes.

Ratings reflect only the views of the issuing credit rating agency or agencies and are not a recommendations to purchase, sell or hold any particular security, including the notes. In addition, ratings do not reflect market prices or suitability of a security for a particular investor, and any future rating of the notes may not reflect all risks related to the Company and its business or the structure or market value of the notes.

Changes in the credit markets could adversely affect the market price of the notes.

Following the offering, the market price for the notes will be based on a number of factors, including:

The condition of the credit markets and prevailing interest rates have fluctuated in the past and can be expected to fluctuate in the future. Fluctuations in these factors could have an adverse effect on the price and liquidity of the notes.

An increase in market interest rates could result in a decrease in the relative value of the notes.

In general, as market interest rates rise, notes bearing interest at a fixed rate generally decline in value. Consequently, if you purchase these notes and market interest rates increase, the market values of your notes may decline. We cannot predict the future level of market interest rates.

We could enter into various transactions that could increase the amount of our outstanding debt, or adversely affect our capital structure or potential credit rating, or otherwise adversely affect holders of the notes.Notes.

Subject to certain exceptions, the terms of the notesNotes do not prevent us from entering into a variety of acquisition, divestiture, refinancing, recapitalization or other highly leveraged transactions. As a result, we could enter into any such transaction even though the transaction could increase the total amount of our outstanding indebtedness, adversely affect our capital structure or potential credit rating or otherwise adversely affect the holders of the notes.

USE OF PROCEEDS

If allThe Notes are not rated and the issuance of a credit rating could adversely affect the rights are exercised, the total purchasemarket price of the notes offeredNotes.

The Notes are not rated by any credit rating agency. The Notes may be rated by one or more of the credit rating agencies after the date of this prospectus. If the Notes are rated, the rating could be lower than expected, and such a rating could have an adverse effect on the valuation of the Notes. Furthermore, credit rating agencies revise their ratings from time to time and could lower or withdraw any rating issued with respect to the Notes. Any real or anticipated downgrade or withdrawal of any ratings of the Notes could have an adverse effect on the valuation, market price or liquidity of the Notes.

Ratings reflect only the views of the issuing credit rating agency or agencies and are not recommendations to purchase, sell or hold any particular security, including the Notes. In addition, ratings do not reflect market prices or suitability of a security for a particular investor, and any future rating of the Notes may not reflect all risks related to us and our business or the structure or market value of the Notes.

Changes in this rightsthe credit markets could adversely affect the valuation, market price and liquidity of the Notes.

Following the offering, the valuation for the Notes will be based on a number of factors, including:

·                  the prevailing interest rates being paid by other companies similar to us; and

·                  the overall condition of the financial markets.

The condition of the credit markets and prevailing interest rates have fluctuated in the past and can be expected to fluctuate in the future. Fluctuations in these factors could have an adverse effect on the valuation, pricing and liquidity of the Notes.

The adjustment to the conversion rate for the Notes converted in connection with a make-whole fundamental change may not adequately compensate you for any lost value of your Notes as a result of such transaction.

If a make-whole fundamental change occurs prior to maturity, under certain circumstances, we will increase the conversion rate by a number of additional shares of Common Stock for the Notes converted in connection with such make-whole fundamental change. The increase in the conversion rate will be determined based on the date on which the make-whole fundamental change occurs or becomes effective and the gross proceedsprice paid (or deemed paid) per share of Common Stock in such fundamental change. The adjustment to the Company from this rights offering,conversion rate for the Notes converted in connection with a make-whole fundamental change may not adequately compensate you for any lost value of your Notes as a result of such fundamental change. In addition, if the price of our Common Stock in the transaction is greater than $20.00 per share or less than $0.32 per share (in each case, subject to adjustment), no additional shares will be added to the conversion rate.

Our obligation to increase the conversion rate upon the occurrence of a make-whole fundamental change could be considered a penalty, in which case the enforceability thereof would be $             million.subject to general principles of reasonableness of economic remedies.

Some significant restructuring transactions may not constitute a fundamental change or a make-whole fundamental change, in which case we would not be obligated to offer to repurchase the Notes or to increase the conversion rate of the Notes.

Upon the occurrence of a fundamental change, holders of Notes have the right to require us to repurchase the Notes at face value and may have the right to convert the Notes with an increased conversion rate. However, the actualdefinition of the terms “fundamental change” and “make-whole fundamental change” are limited to only certain transactions or events. Therefore the fundamental change and make-whole fundamental change provisions will not afford protection to holders of Notes in the event of other transactions or events that do not constitute a make-whole fundamental change but that could nevertheless adversely affect the Notes. For example, transactions such as leveraged recapitalizations, refinancings, restructurings, or acquisitions initiated by us may not constitute a fundamental change or a make-whole fundamental change requiring us to repurchase the Notes or providing you with the right to convert your Notes at an increased conversion rate. In the event of any such transaction, the holders would not have the right to require us to repurchase the Notes or to convert the Notes with an increased conversion rate, even though each of these transactions could increase the amount of proceeds raised pursuant toour indebtedness, or otherwise adversely affect our capital structure or any credit ratings or otherwise adversely affect the value of the Notes.

Valuation of the Notes could be significantly affected by the market price of our Common Stock, which may fluctuate significantly.

We expect that the market price of the Notes (if there is a market for Notes) or the value of the Notes (if there is no market for the Notes) will be significantly affected by the market price of our Common Stock. If there is a market for the Notes, this rights offering will dependmay result in greater volatility in the trading value for the Notes than would be expected for nonconvertible debt securities we may issue. Numerous factors, including many over which we have no control, may have a significant impact on the participationmarket price of our Common Stock.

You may have to pay taxes with respect to distributions on our Common Stock that you do not receive.

The conversion price of the Notes will be adjusted for certain events arising from stock splits and combinations, stock dividends, certain cash dividends and certain other actions by us that modify our capital structure. If the conversion rate is adjusted as a result of a distribution that is taxable to our common shareholders, such as a cash dividend, you may be required to include an amount in this rights offering.income for federal income tax purposes, notwithstanding the fact that you do not receive such distribution. In addition, Non-U.S. Holders (as defined below) of Notes may, in certain circumstances, be deemed to have received a distribution subject to United States federal withholding tax requirements.

Timing and character of your income is based on our treatment of the Notes as non-contingent debt instruments for U.S. federal income tax purposes, which may be different than what the Internal Revenue Service may determine.

We may be obligated to pay amounts in excess of stated interest and principal on the Notes in certain events. We intend to take the position that the Notes will not be treated as contingent payment debt instruments for federal income tax purposes because of the possibility of such additional payments is remote as defined within applicable Treasury Regulations. The Internal Revenue Service (the “IRS”), however, may take a position contrary to our position, which could affect the timing and character of your income and the timing and deductions with respect to the Notes.

The conversion rate of the Notes may not be adjusted for all dilutive events that may occur.

The conversion rate of the Notes is subject to adjustment in limited events.  However, the conversion rate will not be adjusted for other events, such as a third-party tender or exchange offer or stock issuances for cash that may adversely affect the valuation or pricing of the Notes or the Common Stock. An event that adversely affects the value of the Notes may occur, and that event may not result in an adjustment to the conversion rate.

Holders of Notes will not be entitled to any rights with respect to our Common Stock, but will be subject to all changes made with respect to our Common Stock.

Holders of Notes will not be entitled to any rights with respect to our Common Stock (including, without limitation, voting rights and rights to receive any dividends or other distributions, if any, on our Common Stock), but will be subject to all changes affecting our Common Stock. Holders of Notes will have the rights with respect to our Common Stock only when we deliver shares of Common Stock to holders upon conversion of the Notes and, in limited cases, under the conversion rate adjustments applicable to then. For example, if an amendment is proposed to our articles of incorporation or bylaws requiring shareholder approval and the record date for determining the shareholders of record entitled to vote on the amendment occurs prior to the delivery of Common Stock, if any, to holders of Notes, the holders will not be entitled to vote on the amendment, although the holders will nevertheless be subject to any changes in the powers, preferences or special rights of our Common Stock.

Risks Related to Our Common Stock

Because our Common Stock is quoted on the OTCQB marketplace, our liquidity and the price of our Common Stock are limited and our investors may be subject to significant restrictions on the resale of our securities due to state “Blue Sky” laws.

Our Common Stock is traded on the OTC Market Group’s OTCQB Venture Market marketplace quotation system, which is a FINRA-sponsored entity and operated inter-dealer automated quotation system for equity securities not included in a national exchange. Quotation of our Common Stock on the OTCQB marketplace limits the liquidity and price of our Common Stock more than if our Common Stock were quoted or listed on the NYSE or the Nasdaq Capital Market, for example, each of which is a national securities exchange. Lack of liquidity will limit the price at which you may be able to sell our Common Stock or your ability to sell our Common Stock at all.

Each state has its own securities laws, often called “blue sky” laws, which (i) limit sales of securities to a state’s residents unless the securities are registered in that state or qualify for an exemption from registration, and (ii) govern the reporting requirements for broker-dealers doing business directly or indirectly in the state. Before a security is sold in a state, there must be a registration in place to cover the transaction, or the transaction must be exempt from registration. The applicable broker must be registered in that state. We do not know whether our securities will be registered or exempt from registration under the laws of any state. Since our Common Stock is listed on the OTCQB marketplace, a determination regarding registration will be made by those broker-dealers, if any, who agree to serve as the market-makers for our securities. There may be significant state blue sky law restrictions on the ability of investors to sell, and on purchasers to buy, our securities. You should therefore consider the resale market for our securities to be limited, as you may be unable to resell your Common Stock without the significant expense of state registration or qualification.

The conversion of our Notes may also be subject to “blue sky” laws. As a result, depending on the state of residence of a holder of the New Unsecured Notes, a holder may not be able to convert unless we comply with any state securities law requirements necessary to permit such conversion or an exemption applies. Although we plan to use our reasonable efforts to assure that holders will be able to convert their New Unsecured Notes under applicable state securities laws if no exemption exists, there is no assurance that we will be able to do so. As a result, the ability to convert may be limited. The value of the Notes may be significantly reduced if holders are not able to convert their Notes under applicable state securities laws.

If our shares become subject to the penny stock rules, this may make it more difficult to sell our shares.

The SEC has adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks are generally equity securities with a price per share of less than $5.00 (other than securities registered on certain national securities exchanges or authorized for quotation on certain automated quotation systems, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system). The OTC Market Group’s OTCQB Venture Market does not meet such requirements and for so long as the price of our Common Stock is less than $5.00, our securities will be deemed penny stocks. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from those rules, to deliver a standardized risk disclosure document containing specified information. In

addition, the penny stock rules require that prior to effecting any transaction in a penny stock not otherwise exempt from those rules, a broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive (i) the purchaser’s written acknowledgment of the receipt of a risk disclosure statement; (ii) a written agreement to transactions involving penny stocks; and (iii) a signed and dated copy of a written suitability statement. These disclosure requirements may have the effect of reducing the trading activity in the secondary market for our Common Stock, and therefore security holders may have difficulty selling shares of our Common Stock listed on the OTCQB. Reduced trading activity in our Common Stock could also make it more difficult for us to raise additional capital.

Risks Related to our Business

The secondary life insurance market is highly regulated, and state or federal regulations could materially adversely affect our ability to conduct our business.

Our business is highly regulated at the state level with respect to the purchase of life insurance assets and federal laws and regulations with respect to the issuance of securities. At the state level, many states subject us to laws and regulations requiring us to obtain specific licenses or approvals to be able to purchase life insurance policies in those states. State statutes typically provide state regulatory agencies with significant powers to interpret, administer and enforce the laws relating to the purchase of life insurance policies. Under this authority, state regulators have broad discretionary power and may impose new licensing and other requirements, and interpret or enforce existing regulatory requirements in new and different ways. Any of these new requirements, interpretations or enforcement directives could be adverse to our industry, even in a material way. Furthermore, because the life insurance secondary market is relatively new and because of the history of certain abuses in the industry, we believe it is likely that state regulation will increase and grow more complex in the foreseeable future. We cannot, however, predict what any new regulation would specifically involve or how it might affect our industry or our business.

State regulation more generally affecting life insurance assets (and not necessarily directed at the life insurance secondary market itself) may also affect our industry and business in negative ways. For example, we are aware of recent legislative efforts in some states to mandate the sale or liquidation of life insurance policies as a precondition to eligibility for health care under the Patient Protection and Affordable Care Act. These kinds of laws, if passed, may adversely affect the number of life insurance policies available for purchase.

Although the federal laws and regulations do not directly affect the life insurance secondary market, the settlement (i.e., purchase) of life insurance contracts may in some cases constitute a transaction in “securities” that is governed by federal securities laws.

Such state or federal regulations could negatively affect our liquidity and increase our cost of capital and operational expenses, all of which would adversely affect our operating results.

Changes to statutory, licensing and regulatory regimes governing life settlements could have a material adverse effect on our activities and income.

Changes to statutory, licensing and regulatory regimes could result in the enforcement of stricter compliance measures or adoption of additional measures on us or on the insurance companies that stand behind the insurance policies that we own, which could have a material adverse impact on our business activities and income.

The SEC issued a task force report in July 2010 recommending that sales of life insurance policies in life settlement transactions be regulated as securities for purposes of the federal securities laws. To date, the SEC has not made such a recommendation to Congress. However, if the statutory definitions of “security” were amended to encompass life settlements, we could become subject to additional extensive regulatory requirements under the federal securities laws, including the obligation to register sales and offerings of life settlements with the SEC as public offerings under the Securities Act and, potentially, the obligation to register as an “investment company” pursuant to the Investment Company Act of 1940. Any legislation implementing such regulatory change or a change in the transactions that are characterized as life settlement transactions could lead to significantly increased

compliance costs, increased liability risk and adversely affect our ability to acquire or sell life insurance policies in the future, which could have a material adverse effect on our business, financial condition and results of operations.

Over the past years, we have seen a dramatic increase in the number of states that have adopted legislation and regulations from model laws promulgated by either the National Association of Insurance Commissioners (NAIC) or by the National Conference of Insurance Legislators (NCOIL). These laws are essentially consumer protection statutes responding to abuses that arose early in the development of our industry, some of which may persist. Today, almost every state has adopted some version of either the NAIC or NCOIL model laws, which generally require the licensing of purchasers of and brokers for life insurance policies, the filing and approval of purchase agreements, and the disclosure of transaction fees. These laws also require various periodic reporting requirements and prohibit certain business practices deemed to be abusive. State statutes typically provide state regulatory agencies with significant powers to interpret, administer, and enforce the laws relating to the purchase of life insurance policies. Under statutory authority, state regulators have broad discretionary power and may impose new licensing requirements, interpret or enforce existing regulatory requirements in different ways, or issue new administrative rules, any of which could be generally adverse to our industry. Because the life insurance secondary market is relatively new and because of the history of certain abuses in the industry, we believe it is likely that state regulation will increase and grow more complex in the foreseeable future. We cannot, however, predict what any new regulation would specifically involve.

Under the new Presidential administration and U.S. Congress, we expect that there may be many changes to existing U.S. laws, regulations, and standards. Because of the uncertainty regarding existing law, we cannot quantify or predict with any certainty the likely impact of such change on our business model, prospects, financial condition or results of operations. We cannot assure you as to the ultimate content, timing, or effect of changes, nor is it possible at this time to estimate the impact of any such potential legislation.

We may have exposure to greater than anticipated tax liabilities.

Our income tax obligations are based in part on our corporate operating structure and intercompany arrangements, including the manner that we own our life settlements and the valuations of our intercompany transactions. The tax laws applicable to our business, including the laws of the United States, Ireland and other jurisdictions, are subject to interpretation and certain jurisdictions are aggressively interpreting their laws in new ways in an effort to raise additional tax proceeds from companies. The taxing authorities of the jurisdictions in which we operate may challenge our methodologies for intercompany arrangements and ownership of life settlements, which could increase our effective tax rate and harm our financial position and results of operations. We are subject to regular review and audit by U.S. federal and state authorities and, from 2014 on, foreign tax authorities. Tax authorities may disagree with certain positions we have taken and any adverse outcome of such a review or audit could have a material negative effect on our financial position and results of operations. In addition, the determination of our provision for income taxes and other tax liabilities requires significant judgment by management, and there are many transactions where the ultimate tax determination is uncertain. Although we believe that our estimates are reasonable, the ultimate tax outcome may differ from the amounts recorded in our financial statements and may materially affect our financial results in the period or periods for which such determination is made. In addition, our future income taxes could be adversely affected by changes in tax laws, regulations, or accounting principles.

Changes in tax laws or tax rulings could materially affect our financial position and results of operations.

The U.S., Ireland and many countries in the European Union, are actively considering changes to existing tax laws. Certain proposals, including proposals with retroactive effects, could include recommendations that would significantly increase our tax obligations where we do business or where our subsidiaries own life insurance policies. Any changes in the taxation of either international business activities or ownership of life settlements may increase our effective tax rate and harm our financial position and results of operations and, under certain circumstances, may constitute an event of default under the White Eagle Revolving Credit Facility.

Our former structured settlements business may expose us to future claims or contingent liabilities.

Pursuant to the terms of the asset purchase agreement we entered into in connection with the sale of our structured settlements business, we sold substantially all of that business’ operating assets while retaining substantially all of its liabilities. In addition, we agreed to indemnify the purchaser for certain breaches of representations and warranties regarding us and various aspects of that business. Many of our indemnification obligations are subject to time and maximum liability limitations, however, in some instances our indemnification obligations are not subject to any limitations. Significant indemnification claims by the purchaser or other claims or contingent liability related to our former structured settlement business could materially and adversely affect our business, financial condition and results of operations.

Failure to maintain the security of personally identifiable and other information, non-compliance with our contractual or other legal obligations regarding such information, or a violation of our privacy and security policies with respect to such information, could adversely affect us.

In connection with our business, we collect and retain significant volumes of certain types of confidential, information, including personally identifiable and other information pertaining to insureds and counterparties. The Company retains such confidential information in various electronic systems, including computer systems, networks, data processing and administrative systems, and communication systems. The Company tries to maintain physical, administrative, and technical safeguards to protect the information, and it relies on commercial technologies to maintain the security of its systems and to maintain the security of its transmission of such information internally and externally.

An intentional or unintentional breach or compromise of the security measures of the Company or such other parties could result in the disclosure, misappropriation, misuse, alteration or destruction of the confidential information retained by or on behalf of the Company, or the inability of the Company to conduct business for an indeterminate amount of time. Any of these events or circumstances could damage the Company’s business and reputation, and adversely affect its financial condition and results of operations by, among other things, causing harm to the Company’s business operations, reputation and customers, deterring customers and others from doing business with the Company, subjecting the Company to significant regulatory, civil, and criminal liability, and requiring the Company to incur significant legal and other expenses. It is possible that we may not be able to anticipate and implement effective preventative or detective measures against security breaches of all types because the techniques used change frequently or are not recognized until launched and because cyber-attacks can originate from a wide variety of sources or parties. Those parties may also attempt to fraudulently induce employees, customers or other users of our system to deliberately or inadvertently disclose sensitive information in order to gain access to our data or that of our customers or clients.

The legal, regulatory and contractual environment surrounding information security and privacy is constantly evolving and may subject the Company to heightened legal standards, new theories of liability and material claims and penalties that we cannot currently predict or anticipate. As cyber threats and applicable legal standards continue to evolve, the Company may be required to expend significant additional resources to continue to modify or enhance our protective measures and computer systems, and to investigate and remediate any information security vulnerabilities. Also, a significant actual or potential theft, loss, fraudulent use or misuse of customer, counterparty, employee or our data by cybercrime or otherwise, non-compliance with our contractual or other legal obligations regarding such data or a violation of our privacy and security policies with respect to such data could adversely impact our reputation and could result in significant costs, fines, penalties, litigation or regulatory action.

CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS

This prospectus, any prospectus supplement or post-effective amendment we may file with the U.S. Securities and Exchange Commission (“SEC”) in the future, and the documents and reports that we have filed with the SEC that are incorporated herein by reference contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

Forward-looking statements are subject to risks and uncertainties. All statements other than statements of historical fact included or incorporated by reference in this prospectus and in any prospectus supplement or post-effective amendment we may file with the SEC in the future are forward-looking statements. Forward-looking statements give our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance and business. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. These statements may include words such as “anticipate,” “estimate,” “expect,” “project,�� “plan,” “intend,” “believe,” “may,” “will,” “should,” “can have,” “likely” and other words and terms of similar meaning in connection with any discussion of the timing or nature of future operating or financial performance or other events. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our company and our industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. Accordingly, you are cautioned that any such forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and assumptions that are difficult to predict. Although we believe that the expectations reflected in such forward-looking statements are reasonable as of the date made, results may prove to be materially different. Unless otherwise required by law, we disclaim any obligation to update our view of any such risks or uncertainties or to announce publicly the result of any revisions to the forward-looking statements made in this prospectus.

Factors that could cause our actual results to differ materially from those indicated in our forward-looking statements include, but are not limited to, the following:

·                  our ability to continue as a going concern and avoid a bankruptcy, insolvency or other court supervised or out-of-court reorganization proceeding;

·                  our ability to maintain rights offeringin the policies that serve as our primary assets and are the collateral under various debt instruments to which we are a party;

·                  our ability to continue to make selective investments inpremium payments on the life settlement asset class, to pay the premiums on certain life insurance policies that we own whether due to increases in premiums on, or the cost of insurance of, life insurance policies that we own or otherwise;

·                  inaccurate estimates regarding the likelihood and magnitude of death benefits related to life insurance policies that we own;

·                  changes in mortality rates and inaccurate assumptions about life expectancies and other changes to actuarial life expectancy tables;

·                  lack of mortalities of insureds of the life insurance policies that we own;

·                  the effect on our financial condition as a result of any lapsed of life insurance policies;

·                  our ability to sell the life insurance policies we own at favorable prices, if at all;

·                  revolving credit facility limitations and restrictions on our ability to receive distributions of life insurance policy proceeds pledged as collateral;

·                  delays in the receipt of death benefits from our portfolio of life insurance policies;

·                  increases to the discount rates used to value the life insurance policies that we own;

·                  costs related to obtaining death benefits from our portfolio of life insurance policies;

·                  deterioration of the market for life insurance policies and life settlements;

·                  increased carrier challenges to the validity of our life insurance policies;

·                  challenges to the ownership of the policies in our portfolio;

·                  deterioration in the credit worthiness of the life insurance companies that issue the policies included in our portfolio;

·                  liabilities associated with our legacy structured settlement business;

·                  our ability to meet our debt service obligations;

·                  our ability to obtain future financings on favorable terms, or at all;

·                  our ability to continue to comply with the covenants and other obligations, including the conditions precedent for additional draws under our revolving credit facility;

·                  adverse court decisions regarding insurable interest and the obligation of a life insurance carrier to pay death benefits or return premiums upon a successful rescission or contest;

·                  regulation of life settlement transactions as securities;

·                  disruption of our information technology systems;

·                  cyber security risks and the threat of data breaches including any failure to maintain the security of personally identifiable information pertaining to insureds and counterparties;

·                  our ability to maintain a listing or quotation on a national securities exchange or automated quotation system;

·                  loss of the services of any of our executive officers;

·                  our ability to manage the process of exploring strategic alternatives;

·                  adverse developments in capital markets;

·                  changes in laws and regulations;

·                  the effects of United States involvement in hostilities with other countries and large-scale acts of terrorism, or the threat of hostilities or terrorist acts; and

·                  changes in national and global macro-economic conditions including increasing inflation and increasing interest and tax rates among other conditions.

All written and oral forward-looking statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by these cautionary statements. See “Risk Factors” above and in our Annual Report on Form 10-K for the year ended December 31, 2016 and in our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2017 and June 30, 2017 as well as any periodic report, prospectus supplement or post-effective amendment we may file with the SEC in the future. You should evaluate all forward-looking statements made in this prospectus in the context of these risks and uncertainties. We caution you that the important factors referenced above may not contain all of the factors that are important to you.

DETERMINATION OF OFFERING PRICE

The Selling Stockholders will determine at what price they may sell the offered shares of Common Stock and Notes, and such sales may be made at prevailing market prices or at privately negotiated prices. See “Plan of Distribution” below for more information concerning the process by which the Selling Stockholders may make such sales and “Capitalization” for information about the capitalization of the Company which may affect the pricing of the Securities.

DESCRIPTION OF CAPITAL STOCK

As of September 13, 2017, our authorized capital stock consisted of 415,000,000 shares of common stock, par value $0.01 per share, and 40,000,000 shares of undesignated preferred stock, par value $0.01 per share, the rights and preferences of which may be established from time to time by our board of directors. As of September 13, 2017, 156,505,118 shares of common stock were issued and outstanding and no shares of preferred stock were issued and outstanding.

The following summary of certain provisions of our capital stock does not purport to be complete and is subject to and is qualified in its entirety by our amended articles of incorporation and bylaws. The following summary of certain provisions of our Notes does not purport to be complete and is subject to and is qualified in its entirety by our New Convertible Note Indenture.  This description is only a summary. For more detailed information, you should refer to the exhibits to the registration statement of which this prospectus is a part and incorporated by reference into this prospectus. See “Where You Can Find Additional Information.”

Common Stock

Each holder of our common stock is entitled to one vote for each share held by such holder on all matters to be voted upon by our shareholders, and there are no cumulative voting rights. Holders of our common stock are entitled to receive ratably the dividends, if any, as may be declared from time to time by our board of directors out of funds legally available therefor. If there is a liquidation, dissolution or winding up of the Company, holders of our common stock would be entitled to share in our assets remaining after the payment of liabilities. Holders of our common stock have no preemptive or conversion rights or other subscription rights, and there are no redemption or sinking fund provisions applicable to our common stock.

Preferred Stock

Our amended articles of incorporation authorize the issuance of shares of up to 40,000,000 shares of blank check preferred stock with such designation, rights and preferences as may be determined from time to time by our board of directors. Accordingly, our board of directors is empowered, without shareholder approval, to issue preferred stock with dividend, liquidation, conversion, voting or other rights which could adversely affect the voting power or other rights of the holders of common stock. The preferred stock could be utilized as a method of discouraging, delaying or preventing a change in control of us.

Warrants

On February 11, 2011, three shareholders received warrants that may be exercised for up to a total of 4,240,521 shares of the Company’s Common Stock at a weighted average exercise price of $14.51 per share. The warrants will expire seven years after the date of issuance and are exercisable as they fully vest. At June 30, 2017, all 4,240,521 warrants remained outstanding.

As part of the consideration to settle a class action litigation arising in connection with the investigation by the U.S. Attorney’s Office for District of New Hampshire into the Company’s now legacy premium finance business, we issued warrants to purchase up to 2,000,000 million shares of our Common Stock. The warrants were distributed in October 2014 and have a five-year term from the date they were distributed to the class participants with an exercise price of $10.75. The Company is obligated to file a registration statement to register the shares underlying the warrants with the SEC if shares of the Company’s Common Stock have an average daily trading closing price of at least $8.50 per share for a 45 day period. The warrants will be exercisable upon effectiveness of the registration statement. At June 30, 2017, all 2,000,000 warrants remained outstanding.

On July 28, 2017, we issued the Warrants to purchase 42,500,000 shares of our Common Stock at an exercise price of $0.20 per share. The Warrants expire eight years after the date of issuance, with 41% of the shares being immediately exercisable and the remaining shares exercisable upon reaching certain milestones related to the conversion of the Company’s Notes.  The number of shares is subject to anti-dilution adjustment provisions.

Anti-Takeover Effects of Florida Law and Our Articles of Incorporation and Bylaws

Certain provisions of Florida law, our articles of incorporation and our bylaws contain provisions that could have the effect of delaying, deferring or discouraging another party from acquiring control of us. These provisions, which are summarized below, are expected to discourage coercive takeover practices and inadequate takeover bids. These provisions are also designed to encourage persons seeking to acquire control of us to first negotiate with our board of directors. We believe that the benefits of increased protection of our potential ability to negotiate with an unfriendly or unsolicited acquiror outweigh the disadvantages of discouraging a proposal to acquire us because negotiation of these proposals could result in an improvement of their terms.

Requirements for Advance Notification of Shareholder Nominations and Proposals

Our bylaws establish advance notice procedures with respect to shareholder proposals and the nomination of candidates for election as directors, other than nominations made by or at the direction of the board of directors or a committee of the board of directors. The bylaws do not give the board of directors the power to approve or disapprove shareholder nominations of candidates or proposals regarding business to be conducted at a special or annual meeting of the shareholders. However, our bylaws may have the effect of precluding the conduct of certain business at a meeting if the proper procedures are not followed. Our amended articles of incorporation prohibit our shareholders from acting without a meeting by written consent. Our amended articles further require holders of not less than 50% of the voting power of our Common Stock to call a special meeting of shareholders. These provisions

may discourage or deter a potential acquiror from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of our company.

Certain Provisions of Florida Law

We are subject to anti-takeover provisions that apply to public corporations organized under Florida law unless the corporation has elected to opt out of those provisions in its articles of incorporation or its bylaws. We have not elected to opt out of these provisions.

Florida Insurance Code. One of our subsidiaries, Imperial Life Settlements, LLC, a Delaware limited liability company, is licensed as a viatical settlement provider and regulated by the Florida Office of Insurance Regulation. As a Florida viatical settlement provider, Imperial Life Settlements, LLC is subject to regulation as a specialty insurer under certain provisions of the Florida Insurance Code. Under applicable Florida law, no person can acquire, directly or indirectly, 10% or more of the voting securities of a viatical settlement provider or its controlling company, including Emergent Capital, Inc., without the written approval of the Florida Office of Insurance Regulation.

The Florida Office of Insurance Regulation may disapprove an acquisition of beneficial ownership of 10% or more of our voting securities by any person who refuses to apply for or otherwise does not obtain regulatory approval of such acquisition. In addition, if the Florida Office of Insurance Regulation determines that any person has acquired 10% or more of our voting securities without obtaining regulatory approval, it may order that person to cease the acquisition and divest itself of any shares of such voting securities which may have been acquired in violation of the applicable Florida law. The Florida Office of Insurance Regulation may also suspend or revoke Imperial Life Settlements, LLC’s license if it finds that an acquisition of our voting securities was made in violation of the applicable Florida law and would render the further transaction of its business hazardous to its customers, creditors, shareholders or the public.

Indemnification and Limitation of Liability

The Florida Business Corporation Act authorizes Florida corporations to indemnify any person who was or is a party to any proceeding other than an action by, or in the right of, the corporation, by reason of the fact that he or she is or was a director, officer, employee, or agent of the corporation. The indemnity also applies to any person who is or was serving at the request of the corporation as a director, officer, employee, or agent of another corporation or other entity. The indemnification applies against liability incurred in connection with such a proceeding, including any appeal, if the person acted in good faith and in a manner he or she reasonably believed to be in, or not opposed to, the best interests of the corporation. To be eligible for indemnity with respect to any criminal action or proceeding, the person must have had no reasonable cause to believe his or her conduct was unlawful.

In the case of an action by or on behalf of a corporation, indemnification may not be made if the person seeking indemnification is found liable, unless the court in which the action was brought determines that such person is fairly and reasonably entitled to indemnification.

The indemnification provisions of the Florida Business Corporation Act require indemnification if a director, officer, employee or agent has been successful in defending any action, suit or proceeding to which he or she was a party by reason of the fact that he or she is or was a director, officer, employee or agent of the corporation. The indemnity covers expenses actually and reasonably incurred in defending the action.

The indemnification authorized under Florida law is not exclusive and is in addition to any other rights granted to officers, directors and employees under the articles of incorporation or bylaws of the corporation or any agreement between officers and directors and the corporation.

Our bylaws provide for the indemnification of directors, officers, employees and agents and for general corporate purposes, including working capital. Pending the applicationadvancement of expenses incurred in connection with the defense of any action, suit or proceeding that the director, officer, employee or agent was a party to by reason of the net proceeds,fact that he or she is or was a director, officer, employee or agent of the Company, or at our request, a director, officer, employee or agent of another entity. Our bylaws also provide that we expectmay purchase and maintain insurance on behalf of any director, officer, employee or agent against liability asserted against the director, employee or agent in such capacity.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to investour directors, officers and controlling persons pursuant to the proceedsforegoing provisions, or otherwise, we have been advised that in investment-grade, interest-bearing instrumentsthe

opinion of the SEC such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by us of expenses incurred or paid by a director, officer or controlling person in the successful defense of any action, suit or proceeding) is asserted by a director, officer or controlling person in connection with the securities being registered, we will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by us is against public policy as expressed in the Securities Act and will be governed by the final adjudication of this issue.

Under the Florida Business Corporation Act, a director is not personally liable for monetary damages to us or to any other person for acts or omissions in his or her capacity as a director except in certain limited circumstances. Those circumstances include violations of criminal law (unless the director had reasonable cause to believe that such conduct was lawful or had no reasonable cause to believe such conduct was unlawful), transactions in which the director derived an improper personal benefit, transactions involving unlawful distributions, and conscious disregard for the best interest of the corporation or willful misconduct (only if the proceeding is by or in the right of the corporation). As a result, shareholders may be unable to recover monetary damages against directors for actions taken by them which constitute negligence or gross negligence or which are in violation of their fiduciary duties, although injunctive or other securities.

Transfer Agent and Registrar

The transfer agent and registrar for our Common Stock is American Stock Transfer & Trust Company, LLC.

Listing

Our Common Stock is listed on the OTC Market Group’s OTCQB market under the ticker symbol “EMGC.”

CAPITALIZATION

The following table sets forth our cash and cash equivalents (on a restricted and non-restricted basis) and describes our capitalization as of June 30, 2013,2017 (i) on an actual basis and (ii) on an “as adjusted” basis to give effect the entry into of the Transactions described in this prospectus including (1) the completion of the Exchange Offer, (2) the completion of the Senior Note Purchase Agreement and issuance of New Senior Secured Notes, (3) the consummation of the Common Stock Purchase Agreement, (4) the completion of the Rights Offering, (5) the issuance of the Warrants (6) the payment of a dividend and (7) the issuance of an additional 12.5 million shares of Common Stock and $5.0 million in New Senior Secured Notes on August 11, 2017. Debt is presented at the face value of the underlying debt.

You should read this table in conjunction with our audited financial statements for the year ending December 31, 2016, and related notes, as well as “Management’s Discussion and Analysis of Financial Condition and Results of Operations” each of which is incorporated by reference into this prospectus as well as the information set forth in this prospectus under the captions “Use of Proceeds,” and “Our Existing Indebtedness.”

(1) The $1.1 million is shown net of embedded conversion options in the Notes which was separately accounted for under ASC 815 as well as debt issuance cost as required by ASC 835-30.

(2)                                 The $75.8 million shown is the face value of the New Unsecured Notes. However, under ASC 470-20 and ASC 815, the bifurcation of an embedded derivative related to the saleconversion features of all $             notes offered in this rights offeringthe New Unsecured Notes may be required and, accordingly, the carrying value of the New Unsecured Notes at issuance may be less than the subscription priceface value of $25.00 per note after deducting estimated offering expenses.the New Unsecured Notes.

(3)                                 The $35.0 million shown is the face value of the New Senior Secured Notes and does not give effect to debt issuance cost as required by ASC 835-30.

CONSOLIDATED RATIO OF EARNINGS TO FIXED CHARGES

(4)The followingnumber of shares shown as issued and outstanding in the table shows our consolidated ratio of earnings to fixed charges for the periods indicated:above excludes:

THE RIGHTS OFFERING

The Subscription Rights

We are distributing, at no charge, to the holders·                  37,918,483 shares of our shares of common stock asCommon Stock issuable upon conversion of the record date, transferable subscription rights to purchaseNew Unsecured Notes;

·                  an aggregate of up to $                 % Senior Unsecured Notes Due                 , which we which we refer to as the notes. We will pay interest on the notes         on         of each year. We may redeem the notes, in whole or in part, at any time after the anniversary of the date of issuance of the notes for         , plus accrued and unpaid interest to the redemption date. The notes will be issued in minimum denominations of $25.00 and integral multiples of $25.00 in excess thereof. The notes will mature             years from the date of issuance.

You will receive one subscription right for every605,227 shares of common stock you own as of 5:00 p.m., New York City time, on             , 2013, the record date. Shareholders who own fewer than             shares do not have the right to participate in this rights offering.

Each subscription right gives eligible shareholders the opportunity purchase one note in the principal amount of $25.00 at a subscription price of $25.00 per note. You may exercise the subscription privilege with respect to any number of subscription rights, or you may choose to transfer your rights and not exercise any subscription rights at all.

The subscription rights will expire if they are not exercised by 5:00 p.m., New York City time, on                 , 2013, which we refer to as the expiration date, unless we extend the rights offering period. Our board of directors reserves the right to cancel this rights offering at any time, for any reason. If this rights offering is cancelled, all subscription payments received by the subscription agent will be returned promptly.

Basic Subscription Privilege

Pursuant to your basic subscription privilege, each subscription right entitles you to purchase one note, upon delivery of the required documents and payment of the subscription price of $25.00 per note, prior to the expiration of this rights offering. You may exercise all or a portion of your basic subscription privilege; however, if you exercise less than your full basic subscription privilege, you will not be entitled to purchase note with your over-subscription privilege.

Notes not in integral multiples of $25.00 resulting from the exercise of the basic subscription privilege will be eliminated by rounding down to the nearest integral multiple of $25.00, with the total subscription payment being adjusted accordingly. Any excess subscription payments received by the subscription agent will be returned promptly without interest.

Over-Subscription Privilege

If you purchase all of the notes available to you pursuant to your basic subscription privilege, you may also choose to purchase a portion of the notes that are not purchased by other shareholders through the exercise of their respective basic subscription privileges. If sufficient notes are available, we will seek to honor the over-subscription requests in full. If, however, over-subscription requests exceed the amount of notes available, we will allocate the available notespro rata among each shareholder exercising the over-subscription privilege in proportion to the principal amount of notes such shareholder subscribed for and elected to purchase pursuant to the basic subscription privilege up to the amount of notes subscribed for pursuant to the over-subscription privilege. The proration process will be repeated until all notes have been allocated or all over-subscription requests have been satisfied.

In order to exercise your over-subscription privilege, you must deliver the subscription payment related to your over-subscription privilege prior to the expiration of the rights offer. Because we will not know the total

number of unsubscribed notes prior to the expiration of the rights offer, if you wish to maximize the amount of notes you purchase pursuant to your over-subscription privilege, you will need to deliver payment in an amount equal to the aggregate subscription price for the maximum amount of notes that may be available to you (i.e., for the maximum amount of notes available to you, assuming you exercise all of your basic subscription privilege and are allotted the full amount of your over-subscription as elected by you).

We can provide no assurance that you will actually be entitled to purchase the amount of notesour Common Stock issuable upon the exercise of your over-subscription privilege in full at the expirationoptions outstanding as of this rights offering. We will not be able to satisfy yourJune 30, 2017, having a weighted-average exercise price of the over-subscription privilege if all$8.66 per share;

·                  an aggregate of 4,240,521 shares of our shareholders exercise their basic subscription privileges in full, and we will only honor an over-subscription privilege to the extent a sufficient amount of notes are available followingCommon Stock issuable upon the exercise of subscription rights under the basic subscription privileges.warrants outstanding as of June 30, 2017, having a weighted-average exercise price of $14.51 per share;

We will decide all questions concerning the timeliness, validity, form and eligibility of all elections to purchase notes. Our decisions will be final and binding. We, in our sole discretion, may waive any defect or irregularity, or permit a defect or irregularity to be corrected within such time as we may decide. Your election will not be deemed to have been received or accepted until all irregularities have been waived by us or cured by you in such time as we decide.

How to Exercise or Transfer Your Subscription Rights

Upon receiving this prospectus, you can do the following:

To exercise some or all of your subscription rights, you must complete and submit, and the subscription agent must receive, the attached subscription certificate before the expiration date. At the same time, you must provide payment for the principal amount of the notes. You should read the instructions for more information about how to exercise your subscription rights. Once the subscription materials have been submitted, you cannot revoke your decision to exercise your subscription rights.

The subscription rights are transferable until the expiration date, although we cannot assure you that a market will develop or be maintained for the subscription rights. Although no assurance can be given that a market for the subscription rights will develop, trading in the subscription rights will begin on the date of issuance and may be conducted until the close

of trading on the last trading day prior to the expiration date. The value of the subscription rights, if any, will be reflected by the market price. We will not be responsible if subscription rights cannot be sold and it has not guaranteed any minimum sales price for the subscription rights.

Your subscription rights will LAPSE if you do not exercise or transfer your subscription rights before 5:00 p.m., Eastern Time, on                     , 2013. Your subscription rights have no use or value after they lapse.

Material Terms of the Notes

Our $             principal amount unsecured notes will be issued in minimum denominations of $25.00 per note and in integral multiples of $25.00 in excess thereof. The notes are not convertible into shares of our common stock. The notes will bear interest at an annual rate equal to     %. We will pay interest on the notes             on             of each year. We may redeem the notes, in whole or in part, at any time after the                 anniversary of the date of issuance of the notes for         , plus accrued and unpaid interest to the redemption date. The notes will maturefive years from the date of issuance.

                    serves as indenture trustee with respectthey were distributed to the notes pursuantclass participants.

(5)                                 The amount shown does not include impact of possible bifurcation of embedded derivative of New Unsecured Notes as required by ASC 470-20 and ASC 815 and approximately $476,000 in additional interest to recognize the full value of the New Convertible Note due to interest paid-in-kind at closing of the July 28, 2017 transactions.

(6)                                 The amount includes approximately $10.0 million associated with early extinguishment of the 8.50% Senior Unsecured Convertible Notes Due 2019 and the Old Secured Notes inclusive of embedded derivative discount, debt issuance cost and prepayment penalty of 5% on the Old Secured Notes.

DESCRIPTION OF NOTES

We issued the Notes under an indenture (the “New Convertible Note Indenture”) dated as of July 28, 2017 between us and U.S. Bank National Association, as trustee, registrar, paying agent and conversion agent (the “trustee”). The terms of the Indenture, a copy of which is filed as an exhibit to our registration statement. See “Description of Notes” included in this prospectus for a complete description of the notes.

No Standby Purchase Commitment

We are not entering into any standby purchase agreement or similar agreement with respect to the purchase of any notes not subscribed for through the exercise by our shareholders of the basic subscription privilege or the over-subscription privilege.

No Agreement with Shareholders

We are not entering into any agreements with any of our existing shareholders pursuant to which they have agreed to exercise any rights granted to them pursuant to this rights offering. Therefore, there is no certainty that any notes will be purchased pursuant to this rights offering and there is no minimum purchase requirement as a condition to accepting subscriptions.

Delivery of Notes Acquired in this Rights Offering

If you purchase notes in this rights offering by submitting a subscription form and payment, your notes will be issued as soon as practicable after the completion of this rights offering. The notes will be issued only in book-entry form through the facilities of DTC and will be in denominations of $25.00 and integral multiples of $25.00 in excess thereof. The notes will be represented by a Global Security (the “Global Security”) and will be registered in the name of a nominee of DTC. Until your notes have been issued, you may not be able to sell the notes acquired in this rights offering.

Effect of Rights Offering on Existing Shareholders

The rights offering will not have any impact on the ownership interests and voting interests of our existing shareholders, although shareholders will be subordinate to the rights of the noteholders in the event of any liquidation, dissolution or winding up of the Company.

Method of Exercising Subscription Rights

The exercise of subscription rights is irrevocable and may not be cancelled or modified. However, if we amend this rights offering to allow for an extension of this rights offering for a period of more than 30 days or make a fundamental change to the terms set forth in this prospectus, you may cancel your subscription and receive a refund of any money you have advanced. You may exercise your subscription rights as follows:

Subscription by Registered Holders

If you hold certificates of shares of our common stock, the number of rights you may exercise will be indicated on the subscription form delivered to you. You may exercise your subscription rights by properly completing and executing the subscription form and forwarding it, together with your full subscription payment, to the subscription agent at the address set forth below under “Subscription Agent.”

Subscription by Beneficial Owners

If you are a beneficial owner of our shares of common stock that are registered in the name of a broker, dealer, custodian bank or other nominee, you will not receive a subscription form. Instead, one subscription right will be issued to the nominee record holder for every             shares of our common stock that you own at the record date. We will ask your record holder to notify you of this rights offering, but we are not responsible for the failure of your record holder to contact you. If you are not contacted by your broker, dealer, custodian bank or other nominee, you should promptly contact your broker, dealer, custodian bank or other nominee in order to subscribe for notes in this rights offering.

If you hold your shares of our common stock in the name of a broker, dealer, custodian bank or other nominee, your nominee will exercise the subscription rights on your behalf in accordance with your instructions. Your nominee may establish a deadline that may be before the 5:00 p.m., New York time,             , 2013 expiration date we have established for this rights offering.

Payment Method for Registered Holders

As described in the instructions accompanying the subscription form, payments must be made in full in United States currency, in immediately available funds, by certified bank, cashiers check or wire transfer payable to American Stock Transfer & Trust Company, LLC, as subscription agent, f/b/o Imperial Holdings, Inc., drawn upon a U.S. bank. Personal checks are not accepted. Payment received after the expiration of this rights offering may not be honored, and the subscription agent will return your payment to you promptly without interest.

You should read and follow the delivery and payment instructions accompanying the subscription form. Do not send subscription forms or payments directly to Imperial Holdings, Inc. We will not consider your subscription received until the subscription agent has received delivery of a properly completed and duly executed subscription form and other subscription documents and payment of the full subscription amount. The risk of delivery of all documents and payments is borne by you or your nominee, not by the subscription agent or us.

The method of delivery of subscription forms and payment of the subscription amount to the subscription agent will be at the risk of the holders of subscription rights. If sent by mail, we recommend that you send subscription materials and payments by overnight courier or by registered mail, properly insured, with return receipt requested, and that a sufficient number of days be allowed to ensure delivery to the subscription agent and clearance of payment prior to the expiration of this rights offering.

Missing or Incomplete Subscription Information

If you do not indicate the number of subscription rights being exercised, or the subscription agent does not receive the full subscription payment for the number of subscription rights that you indicate are being exercised, then you will be deemed to have exercised the maximum number of subscription rights that may be exercised with the aggregate subscription payment you delivered to the subscription agent. If the subscription agent does not apply your full subscription payment to your purchase of our notes, any excess subscription payment received by the subscription agent will be returned promptly without interest.

Expiration Date and Amendments

The subscription period, during which you may exercise your subscription rights, expires at 5:00 p.m., New York time, on                 , 2013, which is the expiration date of this rights offering. If you do not exercise your subscription rights prior to that time, your subscription rights will expire and will no longer be exercisable. We will not be required to issue notes to you if the subscription agent receives your subscription form and subscription payment after that time, regardless of when the subscription form and subscription payment were sent by you. We have the option to extend this rights offering and the period for exercising your subscription rights, although we do not have any obligation to do so and do not presently intend to do so. We may extend the expiration of this rights offering by giving oral or written notice to the subscription agent prior to the expiration of this rights offering. If we elect to extend the expiration of this rights offering, we will issue a press release announcing such extension no later than 9:00 a.m., New York time, on the next business day after the most recently announced expiration date of this rights offering.

Our board of directors reserves the right to amend or modify the terms of this rights offering at any time, for any reason, including, without limitation, in order to increase participation in this rights offering. Such amendments or modifications may include a change in the subscription price although no such change is presently contemplated. If we should make any fundamental changes to the terms set forth in this prospectus, we will file a post-effective amendment to the registration statement in which this prospectus is included, offer potential purchasers who have subscribed for rights the opportunity to cancel such subscriptions and issue a refund of any money advanced by such shareholder and recirculate an updated prospectus after the post-effective amendment is declared effective with the SEC. In addition, upon such event, we may extend the expiration date of this rights offering to allow holders of rights ample time to make new investment decisions and for us to recirculate updated documentation. Promptly following any such occurrence, we will issue a press release announcing any changes with respect to this rights offering and the new expiration date. The terms of this rights offering cannot be modified or amended after the expiration date of this rights offering.

Conditions, Withdrawal and Termination

We reserve the right to withdraw this rights offering prior to the expiration of the rights offer for any reason. If we terminate this rights offering, in whole or in part, all affected subscription rights will expire without value, and all excess subscription payments received by the subscription agent will be returned promptly without interest. If we cancel this rights offering, we will issue a press release notifying shareholders of the cancellation, and all subscription payments received by the subscription agent will be returned promptly without interest.

Subscription Agent

The subscription agent for this rights offering is American Stock Transfer & Trust Company, LLC. The address to which subscription documents, subscription forms, subscription documents, and subscription payments should be mailed or delivered is:

You are solely responsible for completing delivery to the subscription agent of your subscription materials. The subscription materials are to be received by the subscription agent on or prior to 5:00 p.m., New York City time, on                     , 2013. We urge you to allow sufficient time for delivery of your subscription materials to the subscription agent.

Information Agent

You should direct any questions or requests for assistance concerning the method of subscribing for the notes or for additional copies of this prospectus to the information agent, AST Phoenix Advisors, at (877) 478-5038 or (212) 493-3910. For questions regarding your account and/or lost shares, please contact American Stock Transfer & Trust Company, LLC at (877) 248-6417 or (718) 921-8317.

Fees and Expenses

We will pay all fees charged by the subscription agent and information agent. You are responsible for paying any commissions, fees, taxes or other expenses incurred in connection with your exercise or transfer of the subscription rights.

Beneficial Owners

If you do not hold certificates for shares of our common stock you are a beneficial owner of shares of our common stock. Instead of receiving a subscription form, you will receive your subscription rights through a broker, dealer, custodian bank or other nominee. We will ask your broker, dealer, custodian bank or other nominee to notify you of this rights offering.

You should contact your broker, dealer, custodian bank or other nominee if you do not receive information regarding this rights offering, but believe you are entitled to subscription rights. We are not responsible if you do not receive notice by your broker, dealer, custodian bank or other nominee or if you do not receive notice in time to respond to your intermediary by the deadline established by the nominee, which may be prior to 5:00 p.m. New York time, on                     , 2013.

If you wish to exercise your subscription rights, you will need to have your broker, dealer, custodian bank or other nominee act for you. If you hold certificates for shares of our common stock and received a subscription form, but would prefer to have your broker, dealer, custodian bank or other nominee act for you, you should contact your intermediary and request it to effect the transaction for you.

Notice to Record Holders

If you are a broker, dealer, custodian bank or other nominee that holds shares of our common stock as record holder for the account of others on the record date, you should notify the beneficial owners of this rights offering as soon as possible to learn their intentions with respect to exercising their subscription rights. You should obtain instructions from the beneficial owner, asthose expressly set forth in the instructions we have provided to you for your distribution to beneficial owners. If the beneficial owner so instructs, you should submit information and payment for shares. We expect that the exercise of subscription rights on behalf of beneficial owners may be made through the facilities of DTC. You may exercise individual or aggregate beneficial owner subscription rights by instructing DTC to transfer subscription rights from your account to the account of the subscription agent, together with certification as to the aggregate number of subscription rights exercised and the notes subscribed for and your full subscription payment.

Validity of Subscriptions

We will resolve all questions regarding the validity and form of the exercise of your subscription rights, including time of receipt and eligibility to participate in this rights offering. Our determination will be final and binding. Once made, subscriptions and directions are irrevocable, and we will not accept any alternative, conditional or contingent subscriptions or directions. We reserve the absolute right to reject any subscriptions or directions not properly submitted or the acceptance of which would be unlawful. You must resolve any irregularities in connection with your subscriptions before the subscription period expires, unless waived by us in our sole discretion. Neither we nor the subscription agent shall be under any duty to notify you or your representative of defects in your subscriptions. A subscription will be considered accepted, subject to our right to

withdraw or terminate this rights offering, only when a properly completed and duly executed subscription form, any other required documents, and the full subscription payment have been received by the subscription agent. Our interpretations of the terms and conditions of this rights offering will be final and binding.

Escrow Arrangements; Return of Funds

The subscription agent will hold funds received in payment for shares of the notes in a segregated account pending completion of this rights offering. The subscription agent will hold this money in escrow until this rights offering is completed or is withdrawn and canceled. If this rights offering is canceled for any reason, all subscription payments received by the subscription agent will be returned promptly without interest.

Foreign Shareholders

We will not mail this prospectus or subscription forms to shareholders with addresses that are outside the United States or that have a military or diplomatic post office or foreign post office address. The subscription agent will hold these subscription forms for their account. To exercise subscription rights, our shareholders with addresses outside the United States must notify the subscription agent prior to 12:00 p.m., New York time, at least three business days prior to the expiration of this rights offering and demonstrate to the satisfaction of the subscription agent that the exercise of such subscription rights does not violate the laws of the jurisdiction of such shareholder.

No Revocation or Change

Once you submit the form of subscription form to exercise any subscription rights, you are not allowed to revoke or change the exercise or request a refund of monies paid. All exercises of subscription rights are irrevocable, even if you learn information about us that you consider to be unfavorable. However, if we amend this rights offering to allow for an extension of this rights offering for a period of more than 30 days or make a fundamental change to the terms set forth in this prospectus, you may cancel your subscription and receive a refund of any money you have advanced. You should not exercise your subscription rights unless you are certain that you wish to purchase the notes.

Material United States Federal Income Tax Consequences

For United States federal income tax purposes, you should not recognize income or loss upon receipt or exercise of subscription rights. However, you should consult your tax advisor as to your particular tax consequences resulting from this rights offering. For a more detailed discussion, see “Material United States Federal Income Tax Consequences.”

No Recommendations to Rights Holders

Although we expect that some or all of our directors may participate in this rights offering, our board of directors is making no recommendation regarding your exercising of subscription rights. You are urged to make your decision based on your own assessment of our business and the risks involved.

Listing

The subscription rights are transferable, although we cannot assure you that a market will develop or be maintained for the subscription rights. We intend to file an application to list the notes on NASDAQ Global Market under the symbol “             ,” but we cannot assure you that the notes will be listed for trading or that a liquid market for our rights or our notes will develop. The notes are expected to trade “flat,” meaning that the purchasers will not pay and sellers will not receive any accrued and unpaid interest on the notes that is not included in the trading price. Shares of our common stock are traded on the NYSE under the symbol “IFT.”

DESCRIPTION OF    % SENIOR UNSECURED NOTES DUE

We are offering     % Senior Unsecured Notes Due                 , which have been defined herein as the notes. The notes may be purchased upon exercise of transferable subscription rights distributed to holders of our common stock.

The notes will be issued under an indenture to be dated as of the closing date, entered into between us and                 , which we refer to herein as the Indenture. The terms of the notes include those stated in theConvertible Note Indenture and those made a part of the New Convertible Note Indenture by reference to the Trust Indenture Act of 1939, as amended.amended (the “Trust Indenture Act”).

Because this section

You may request a copy of the New Convertible Note Indenture from us as described under “Where You Can Find Additional Information.”

The following description is a summary itof the material provisions of the Notes and the New Convertible Note Indenture and does not describe every aspectpurport to be complete. This summary is subject to and is qualified by reference to all the provisions of the notesNotes and the New Convertible Note Indenture, including the definitions of certain terms used in the New Convertible Note Indenture. We urge you to read the Notes and the New Convertible Note Indenture because it,they, and not this description, definesdefine your rights as a holder of the notes. Notes.

For example,purposes of this description, references to “the Company,” “Emergent,” “we,” “our” and “us” refer only to Emergent Capital, Inc. and not to any of its current or future subsidiaries.

General

The Notes are:

·                  our general unsecured, senior obligations;

·                  limited to an aggregate principal amount of $75,838,966 of which $72,238,000 are $1,000 denominated Notes and $3,598,966 are $1 denominated Notes;

·                  bear cash interest from July 28, 2017 at an annual rate of 5.00%, payable in this section, we use capitalized wordsarrears on February 15 and August 15 of each year, beginning on August 15, 2017;

·                  subject to signify terms that are specificallypurchase by us for cash at the option of the holders following a fundamental change (as defined in the Indenture. Some of the definitions are repeatedNew Convertible Note Indenture) and to redemption by us at our option on or after a specified date and subject, in this prospectus, but for the rest you will needcertain cases, to read the Indenture.

General

The notes:certain requirements;

The notes will be our direct unsecured obligations and will rank:repurchased;

With respect to any rights plan that we implement after the date of the New Convertible Note Indenture, to the extent that such rights plan is in effect upon conversion of the Notes into Common Stock, you will receive, in addition to the shares of Common Stock received in connection with such conversion, the rights under the rights plan with respect to such Common Stock, unless prior to any conversion, the rights have separated from our Common Stock, in which case, and only in such case, the conversion rate will be adjusted at the time of separation

as if we distributed to all holders of our Common Stock, shares of our capital stock, evidences of indebtedness, assets, property, rights or warrants as described in clause (3) above, subject to readjustment in the event of the expiration, termination or redemption of such rights.

Notwithstanding any of the foregoing, the applicable conversion rate will not be adjusted:

·                  upon the issuance of any shares of our Common Stock pursuant to any present or future plan providing for the reinvestment of dividends or interest payable on our securities and the investment of additional optional amounts in shares of our Common Stock under any plan;

·                  upon the issuance of any shares of our Common Stock or options or rights to purchase those shares pursuant to any present or future employee, director or consultant benefit plan or program of or assumed by us or any of our subsidiaries;

·                  upon the issuance of any shares of our Common Stock pursuant to any option, warrant, right or exercisable, exchangeable or convertible security not described in the preceding bullet and outstanding as of the date the Notes were first issued;

·                  upon the exercise of up to 2.0 million warrants to purchase shares of our Common Stock that were issued in connection with the settlement of the class actions arising in connection with the investigation by the U.S. Attorney’s Office for District of New Hampshire into the Company’s now legacy premium finance business;

·                  upon the transfer of any life settlements to a subsidiary;

·                  for a change in the par value of our Common Stock; or

·                  for accrued and unpaid interest (including additional interest, if any).

Adjustments to the applicable conversion rate will be calculated to the nearest 1/10,000th of a share. We will not be required to make an adjustment in the conversion rate unless the adjustment would require a change of at least 1% in the conversion rate. However, we will carry forward any adjustments that are less than 1% of the conversion rate and make such carried forward adjustment, regardless of whether the aggregate adjustment is less than 1%, on the conversion date for any Notes.

Recapitalizations, Reclassifications and Changes of Our Common Stock

In the case of:

·                  any recapitalization, reclassification or change of our common stock (other than changes resulting from a subdivision or combination);

·                  a consolidation, merger or combination involving us; or

·                  a sale, lease or other transfer to a third party of all or substantially all of the consolidated assets of ours and our subsidiaries (other than a transfer of any life settlements or other assets to a subsidiary), or any statutory share exchange,

in each case, the result of which shares of our common stock would be converted into, or exchanged for, stock, other securities, other property or assets (including cash or any combination thereof), then, at the effective time of the transaction, the right to convert each $1,000 principal amount of a Note, or each $1.00 denominated Note, will be changed into a right to convert it into the kind and amount of shares of stock, other securities or other property or assets (including cash or any combination thereof) that a holder of a number of shares of common stock equal to the conversion rate prior to such transaction would have owned or been entitled to receive (the “reference property”) upon such transaction. If the transaction causes our common stock to be converted into the right to receive more

than a single type of consideration (determined based in part upon any form of shareholder election), the reference property into which the Notes will be convertible will be deemed to be the weighted average of the types and amounts of consideration received by the holders of our common stock that affirmatively make such an election. We agreed in the New Convertible Note Indenture not to become a party to any such transaction unless its terms are consistent with the foregoing.

Certain Other Adjustments

Whenever any provision of the New Convertible Note Indenture requires us to calculate last reported sale prices over a span of multiple days, our board of directors will make appropriate adjustments to such prices, the conversion rate, or the amount due upon conversion to account for any adjustment to the conversion rate that becomes effective, or any event requiring an adjustment to the conversion rate where the record date of the event occurs, at any time during the period from which such prices are to be calculated.

Adjustment to Shares Delivered Upon Conversion Upon a Make-Whole Fundamental Change

If (i) a “fundamental change” (as defined below and determined after giving effect to any exceptions or exclusions to such definition, but without regard to the proviso in clause (2) of the definition thereof) or (ii) we call the Notes for redemption as described under “—Optional Redemption by the Company”(either event, a “make-whole fundamental change”) that occurs prior to maturity and a holder elects to convert its Notes in connection with such make-whole fundamental change, we will, under certain circumstances, increase the conversion rate for the Notes so surrendered for conversion by a number of additional shares of Common Stock (the “additional shares”), as described below. A conversion of Notes will be deemed for these purposes to be “in connection with” a make-whole fundamental change described in clause (i) above if the notice of conversion of the Notes is received by the conversion agent from, and including, the effective date of the make-whole fundamental change up to, and including, the business day immediately prior to the related fundamental change purchase date (or, in the case of an event that would have been a fundamental change but for the proviso in clause (2) of the definition thereof, the 35th calendar day immediately following the effective date of such make-whole fundamental change). A conversion of Notes will be deemed for these purposes to be “in connection with” a make-whole fundamental change described in clause (ii) above if the notice of conversion of the Notes is received by the conversion agent from, and including, the date of issuance of a notice of redemption as described under “—Optional Redemption by the Company—Redemption Procedures,” for a provisional redemption described under “—Optional Redemption by the Company” up to the close of business on the third business day immediately preceding the relevant redemption date. In the event that a conversion of Notes occurs in connection with two concurrent make-whole fundamental changes under clauses (i) and (ii) above, a holder of any such Notes to be converted will be entitled to an increase in the conversion rate based on the first to occur effective date of such make-whole fundamental changes.

Upon surrender of Notes for conversion in connection with a make-whole fundamental change, we will deliver shares of our common stock as described under “—Conversion Rights—Payment Upon Conversion,” calculated based on the conversion rate as adjusted by the additional shares. However, if, at the effective time of such transaction, the reference property as described under “—Conversion Rights—Recapitalizations, Reclassifications and Changes of Our Common Stock” above is comprised entirely of cash, then, for any conversion of Notes following the effective date of such make-whole fundamental change, the conversion obligation will be calculated based solely on the “stock price” (as defined below) for the transaction and will be deemed to be an amount equal to the conversion rate (including any adjustment additional shares) multiplied by such stock price. In such event, the conversion obligation will be determined and paid to holders in cash on the third business day following the conversion date. We will notify holders of the effective date of any make-whole fundamental change referred to in clause (i) above and issue a press release announcing such effective date no later than five business days after such effective date.

The number of additional shares by which the conversion rate will be increased will be determined by reference to the table below, based on the date on which the make-whole fundamental change occurs or becomes effective (the “effective date”) and the price (the “stock price”) paid (or deemed paid) per share of our common stock in the fundamental change. If the holders of our common stock receive only cash in a make-whole fundamental change described in clause (2) of the definition of fundamental change, the stock price shall be the cash amount paid per share. Otherwise, the stock price shall be the average of the last reported sale prices of our common

stock over the 10 trading-day period ending on, and including, the trading day immediately preceding the effective date of the make-whole fundamental change. In connection with a make-whole fundamental change triggered by a redemption of the Notes as described under “—Optional Redemption by the Company,” the effective date of such make-whole fundamental change will be the date on which we deliver notice of the redemption.

The stock prices set forth in the column headings of the table below will be adjusted as of any date on which the conversion rate of the Notes is otherwise adjusted. The adjusted stock prices will equal the stock prices applicable immediately prior to such adjustment, multiplied by a fraction, the numerator of which is the conversion rate immediately prior to the adjustment giving rise to the stock price adjustment and the denominator of which is the conversion rate as so adjusted. The number of additional shares will be adjusted in the same manner as the conversion rate as set forth under “—Conversion Rights—Conversion Rate Adjustments.”

The following table sets forth the number of additional shares to be received per $1,000 principal amount of Notes for each stock price and effective date set forth below:

The exact stock prices and effective dates may not be set forth in the table above, in which case:

·                  If the stock price is between two stock prices in the table or the effective date is between two effective dates in the table, the number of additional shares will be determined by a straight-line interpolation between the number of additional shares set forth for the higher and lower stock prices and the earlier and later effective dates, as applicable, based on a 365-day year.

·                  If the stock price is greater than $20.00 per share (subject to adjustment in the same manner as the stock prices set forth in the column headings of the table above), no additional shares will be added to the conversion rate.

·                  If the stock price is less than $0.32 per share (subject to adjustment in the same manner as the stock prices set forth in the column headings of the table above), no additional shares will be added to the conversion rate.

For any $1.00 denominated Note, the number of additional shares to be received per $1.00 denominated Note for each stock price and effective date will be the number corresponding to such stock price and effective date divided by 1,000.

Our subsidiariesobligation to satisfy the additional shares requirement could be considered a penalty, in which case the enforceability thereof would be subject to general principles of reasonableness and equitable remedies.

Fundamental Change Permits Holders to Require Us to Purchase Notes

If a “fundamental change” (as defined below in this section) occurs at any time, you will have the right, at your option, to require us to purchase for cash any or all of your Notes, or any portion of the principal amount thereof, that is equal to $1,000 or a multiple of $1,000 for $1,000 denominated Notes or any even dollar amount of dollar denominated Notes. The price we are separate and distinct legal entities and have no obligation, contingent or otherwise,required to pay is equal to 100% of the principal amount of the Notes to be purchased plus accrued and unpaid interest (including additional interest), if any, amounts dueto, but excluding, the fundamental change purchase date (unless the fundamental change purchase date is after a record date and on or

prior to the interest payment date to which such record date relates, in which case we will instead pay the full amount of accrued and unpaid interest (including any additional interest) to the holder of record on such record date and the fundamental change purchase price will be equal to 100% of the principal amount of the Notes to be purchased). The fundamental change purchase date will be a date specified by us that is not less than 20 or more than 35 calendar days following the date of our fundamental change notice as described below. Any Notes purchased by us will be paid for in cash.

A “fundamental change” will be deemed to have occurred at the time after the Notes are originally issued if any of the following occurs:

(1)                                 a “person” or “group” within the meaning of Section 13(d) of the Exchange Act other than us, our subsidiaries and our and their employee benefit plans, has become the direct or indirect “beneficial owner,” as defined in Rule 13d-3 under the Exchange Act, of our common equity representing more than 50% of the voting power of our common equity;

(2)                                 consummation of any share exchange, consolidation or merger of us, or any transaction or series of transactions pursuant to which our Common Stock will be converted into cash, securities or other property or any sale, lease or other transfer (other than encumbrance) in one transaction or a series of transactions of all or substantially all of the consolidated assets of us and our subsidiaries, taken as a whole, to any person other than one of our subsidiaries; provided, however, that a transaction where the holders of all classes of our common equity immediately prior to such transaction that is a share exchange, consolidation or merger own, directly or indirectly, more than 50% of all classes of common equity of the continuing or surviving corporation or transferee or the parent thereof immediately after such event shall not be a fundamental change;

(3)                                 the first day on which a majority of the members of our board of directors does not consist of “continuing directors”;

(4)                                 our shareholders approve any plan or proposal for our liquidation or dissolution; or

(5)                                 our Common Stock (or other common stock into which the Notes are then convertible) ceases to be listed or quoted on the notesNew York Stock Exchange, the NYSE MKT, the NASDAQ Global Market, the NASDAQ Global Select Market, the NASDAQ Capital Market, the OTCQX and the OTCQB (or each of their respective successors) (each such market, a “trading market”).

A fundamental change as a result of clause (2) above will not be deemed to have occurred, however, (a) if 90% of the consideration received or to makebe received by our common shareholders, excluding cash payments for fractional shares, in connection with the transaction or transactions constituting the fundamental change consists of shares of common stock traded on a trading market or which will be so traded when issued or exchanged in connection with a fundamental change (these securities being referred to as “publicly traded securities”) and as a result of this transaction or transactions the Notes become convertible into such publicly traded securities, excluding cash payments for fractional shares, and (b) as a result of the consummation of the transactions contemplated by the Master Transaction Agreements or any funds available for paymentof the other “Transaction Documents” (as defined in the Master Transaction Agreements).

“Continuing directors” means (i) individuals who on the notes,date of original issuance of the Notes constituted our board of directors (ii) any new directors whose election to our board of directors or whose nomination for election by our shareholders was approved by at least a majority of our directors then still in office (or a duly constituted committee thereof), either who were directors on the date of original issuance of the Notes or whose election or nomination for election was previously so approved.

On or before the 20th calendar day after the occurrence of a fundamental change, we will provide to all holders of the Notes and the trustee, the conversion agent and paying agent a notice of the occurrence of the fundamental change and of the resulting purchase right. Such notice shall state, among other things:

·                  the events causing a fundamental change;

·                  the date of the fundamental change;

·                  the last date on which a holder may exercise the repurchase right;

·                  the fundamental change purchase price;

·                  the fundamental change purchase date;

·                  the name and address of the paying agent and the conversion agent, if applicable;

·                  if applicable, the applicable conversion rate and any adjustments to the applicable conversion rate;

·                  if applicable, that the Notes with respect to which a fundamental change purchase notice has been delivered by a holder may be converted only if the holder withdraws the fundamental change purchase notice in accordance with the terms of the New Convertible Note Indenture; and

·                  the procedures that holders must follow to require us to purchase their Notes.

Simultaneously with providing such notice, we will publish a notice containing this information in a newspaper of general circulation in New York, New York, or publish the information on our website or through such other public medium as we may use at that time.

To exercise the purchase right, you must deliver, on or before the business day immediately preceding the fundamental change purchase date, the Notes to be purchased, duly endorsed for transfer, together with a written purchase notice and the form entitled “Form of Fundamental Change Purchase Notice” on the reverse side of the Notes duly completed, to the paying agent if the Notes are in certificated form. If the Notes are not in certificated form, you must comply with DTC’s procedures for tendering interests in global Notes. Your purchase notice must state:

·                  if certificated, the certificate numbers of your Notes to be delivered for purchase;

·                  the portion of the principal amount of Notes to be purchased, which must be $1,000 or a multiple thereof for $1,000 denominated Notes or any even dollar amount of denominated Notes; and

·                  that the Notes are to be purchased by us pursuant to the applicable provisions of the Notes and the New Convertible Note Indenture.

You may withdraw any purchase notice (in whole or in part) by a written notice of withdrawal delivered to the paying agent prior to the close of business on the business day prior to the fundamental change purchase date. The notice of withdrawal shall state:

·                  the principal amount of the withdrawn Notes;

·                  if certificated Notes have been issued, the certificate numbers of the withdrawn Notes, or if not certificated, your notice must comply with appropriate DTC procedures; and

·                  the principal amount, if any, which remains subject to the purchase notice.

We will be required to purchase the Notes on the fundamental change purchase date, subject to extension to comply with applicable law. You will receive payment of the fundamental change purchase price on the later of the fundamental change purchase date or the time of book-entry transfer or the delivery of the Notes. If the paying agent holds money or securities on the fundamental change purchase date sufficient to pay the fundamental change purchase price of Notes for which the holders have tendered and not withdrawn purchase notices, then:

·                  such Notes will cease to be outstanding and interest (including additional interest, if any) will cease to accrue (whether or not book-entry transfer of the Notes is made or whether or not the Notes are delivered to the paying agent); and

·                  all other rights of the holder will terminate (other than the right to receive the fundamental change purchase price and previously accrued and unpaid interest (including additional interest, if any) upon delivery or transfer of the Notes).

In connection with any purchase offer pursuant to a fundamental change purchase notice, we will, if required:

·                  comply with the provisions of the tender offer rules under the Exchange Act that may then be applicable; and

·                  file a Schedule TO or any other required schedule under the Exchange Act.

After a Note holder delivers a Fundamental Change Purchase Notice, Notes subject of such notice may not be converted unless either (i) such Fundamental Change Purchase Notice has first been validly withdrawn or (ii) there shall be a default in the payment of the Fundamental Change Purchase Price; provided that the conversion right with respect to such Notes shall terminate at the close of business on the date such default is cured and such Notes are purchased in accordance herewith.

No Notes may be purchased at the option of holders upon a fundamental change if there has occurred and is continuing an event of default with respect to the Notes other than an event of default that is cured by dividends, loansthe payment of the fundamental change purchase price of the Notes.

The put rights of the holders of the Notes could discourage a potential acquirer from acquiring us. The fundamental change purchase feature, however, is not the result of management’s knowledge of any specific effort to obtain control of us by any means or part of a plan by management to adopt a series of anti-takeover provisions.

The term “fundamental change” is limited to specified transactions and may not include other payments.events that might adversely affect our financial condition. In addition, the payment of dividends and the making of loans and advances to us by our subsidiaries may be subject to statutory, contractual or other restrictions, may depend on the earnings or financial condition of all of the foregoing and are subject to various business considerations. As a result, we may be unable to gain significant, if any, access to the cash flow or assets of our subsidiaries.

The Indenture does not limit the amount of debt (secured and unsecured)requirement that we and our subsidiariesoffer to purchase the Notes upon a fundamental change may incur or our ability to pay dividends, sell assets, enter into transactions with affiliates or make investments. In addition, the Indenture does not contain any provisions that would necessarily protect holders in the event of notes if we become involved in a highly leveraged transaction, reorganization, merger or other similar transaction that adversely affectsinvolving us.

The definition of fundamental change includes a phrase relating to the sale, lease or other transfer (other than encumbrance) of “all or substantially all” of our consolidated assets. There is no precise, established definition of the phrase “substantially all” under applicable law. Accordingly, the ability of a holder of the Notes to require us to purchase its Notes as a result of the conveyance, transfer, sale, lease or them.

The notesIf a fundamental change were to occur, we may not have enough funds to pay the fundamental change purchase price. If we fail to purchase the Notes when required following a fundamental change, we will be issued in fully registered form only, without coupons,default under the New Convertible Note Indenture. In addition, we have, and may in minimum denominationsthe future incur, other indebtedness with similar change in control provisions permitting holders of $25.00our debt to accelerate or to require us to purchase our indebtedness upon the occurrence of similar events or on some specific dates.

Consolidation, Merger and integral multiples thereof. Sale of Assets

The notesNew Convertible Note Indenture provides that we will be represented by one or more global notes depositednot consolidate with or on behalfmerge into any other person or convey, lease or transfer (other than encumbrance) all or substantially all of The Depository Trust Company (“DTC”),our properties and assets to any person unless:

(1)                                 the person formed by such consolidation or into which we are merged or the person which acquires by conveyance or transfer, or which leases all or substantially all of our properties and

assets, shall (i) be a nominee thereof. Except as otherwise provided insubsidiary or (ii) be a corporation organized and existing under the Indenture, the notes will be registered in the name of that depositary or its nominee, and note holders will not receive certificates for the notes. We will make payments on a global security in accordance with the applicable policieslaws of the depositary as in effect from time to time. Under those policies, we will make payments directlyUnited States of America, any state thereof or the District of Columbia, and shall expressly assume, by a supplemental indenture, executed and delivered to the depositary, or its nominee, and not to any indirect holders who own beneficial interests intrustee, all of our obligations under the global security. An indirect holder’s right to those payments will be governed by the rules and practices of the depositary and its participants.

Interest Provisions Related to the Notes

Interest on the notes will accrue at the rate of         % per annum and will be payable                  on each                 ,                 ,                 commencing on                 , 2013. The initial interest period will be the period from and including the original issue date to, but excluding, the initial interest payment date, and the subsequent interest periods will be the periods from and including an interest payment dateNew Convertible Note Indenture;

(2)                                 immediately after giving effect to but excluding, the next interest payment datesuch transaction, no default or the stated maturity date,event of default (each as the case may be. We will pay interest to those persons who were holders of record of such notes on the 1st day of the month during which each interest payment date occurs: each             , commencing             1, 2013.

Interest on the notes will accrue from the date of original issuance and will be computed on the basis of a 360-day year comprised of twelve 30-day months. We will not provide a sinking fund for the notes.

Interest payments will be made only on a business day, defined in the Indenture asNew Convertible Note Indenture) shall have occurred and be continuing; and

(3)                                 we shall have delivered to the trustee an officers’ certificate and an opinion of counsel, each Monday, Tuesday, Wednesday, Thursdaystating that such consolidation, merger, conveyance, transfer or lease and Fridaysuch supplemental indenture comply with this provision and that is not a day on which banking institutionsall conditions precedent provided for in New York Citythe indenture relating to such transaction have been complied with.

Although these types of transactions are authorized or required by law or executive order to close. If any interest payment is due on a non-business day, we will make the payment on the next day that is a business day. Payments made on the next business day in this situation will be treatedpermitted under the New Convertible Note Indenture, certain of the foregoing transactions could constitute a “fundamental change” (as defined above) permitting each holder to require us to purchase the Notes of such holder as if they were made ondescribed above.

Events of Default

Each of the original due date. Such payment will not result in afollowing is an event of default under the notes or the Indenture, and no interest will accrue on the payment amount from the original due date to the next day that is a business day.New Convertible Note Indenture:

Book-entry and other indirect holders should consult their banks or brokers for information on how they will receive payments on their notes.

Redemption and Repayment

The notes may be redeemed in whole or in part at any time or from time to time at our option on or after                 ,                 , upon not less than 30 days nor more than 60 days written notice by mail prior to the date fixed for redemption thereof, at a redemption price of         % of the outstanding principal amount thereof plus accrued and unpaid interest payments otherwise payable for the then-current quarterly interest period accrued to the date fixed for redemption.

Note holders may be prevented from exchanging or transferring the notes when they are subject to redemption. In case any notes are to be redeemed in part only, the redemption notice will provide that, upon surrender of such note, a note holder will receive, without a charge, a new note or notes of authorized denominations representing the principal amount of the remaining unredeemed notes.

If we redeem only some of the notes, the Trustee or DTC, as applicable, will determine the method for selection of the particular notes to be redeemed, in accordance with the Indenture, and in accordance with the rules of any national securities exchange or quotation system on which the notes are listed. Unless we(1)                                 default in payment of the redemption price, on and after the date of redemption, interest will cease to accrue on the notes called for redemption.

Holders will not have the option to have the notes repaid prior to the stated maturity date.

Listing

We intend to apply to list the notes on the NASDAQ Global Market under the symbol “     .” If the application is approved, we expect trading in the notes to begin within 30 days of the original issue date.

Trading Characteristics

We expect the notes to trade at a price that takes into account the value, if any, of accrued and unpaid interest. This means that purchasers will not pay, and sellers will not receive, accrued and unpaid interest on the notes that is not included in their trading price. Any portion of the trading price of a note that is attributable to accrued and unpaid interest will be treated as a payment of interest for U.S. federal income tax purposes and will not be treated as part of the amount realized for purposes of determining gain or loss on the disposition of the notes. See “Material United States Federal Tax Considerations.”

Certain Covenants

If at any time when notes are outstanding we are not subject to the reporting requirements of Sections 13 or 15(d) of the Exchange Act, we will provide to holders of the notes and the trustee, our audited annual consolidated financial statements, within 90 days of our fiscal year end, and unaudited interim consolidated financial statements, within 45 days of our fiscal quarter end (other than our fourth fiscal quarter). All such financial statements will be prepared, in all material respects, in accordance with applicable United States generally accepted accounting principles.

We have agreed to duly and punctually pay the principal of (and premium,(including additional interest, if any) and interest, on the notes in accordance with the terms of the notes.

We have agreed to maintain an office or agency where the notes may be presented or surrendered for payment, surrendered for registration of transfer or exchange and where notices in respect of the notes may be served.

We have agreed that if at any time we shall act as our own paying agent with respect to the notes, we will, on or before each due date of the principal of (or premium, if any) or interest, if any, on any of the notes, segregate and hold in trust for the holders of the notes funds sufficient to pay the principal (and premium, if any) and interest, if any, on the notes until paid.

We have agreed to deliver to the trustee, within 120 days after the end of each fiscal year an officer’s certificate stating to the knowledge of the signers thereof whether we are in default in the performance of any terms, provision orNote when the same conditions of the Indenture.

We have agreed to pay or discharge, or cause to be paid or discharged, before the same would become delinquent (unless being disputed in good faith by us), (i) all taxes, assessmentsbecomes due and governmental charges levied or imposed upon us or our income, profits or property, and (2) all lawful claims for labor, materials and supplies that may become a lien on our property except where failure to do so would not reasonably be expected to have a material adverse effect on our business, assets, financial condition or results of operations.

Events of Default

Note holders will have rights if an Event of Default occurs in respect of the notes and is not cured, as described later in this subsection.

The term “Event of Default” in respect of the notes means any of the following: