SECOND AMENDED AND RESTATED AGREEMENT

by and among

GREENLIGHT REINSURANCE, LTD.,
GREENLIGHT REINSURANCE IRELAND, LTD.,
GREENLIGHT CAPITAL RE, LTD. (for limited purposes)

and

DME ADVISORS, LLC

AMENDED AND RESTATED AS OF JANUARY 1, 2014

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TABLE OF CONTENTS
 
 
 
Page
 
 
Article I Definitions
1
 
 
Article II Organization
8
 
 
2.1. Purpose of Agreement
8
2.2. Assets
8
2.3. Term of Agreement
8
2.4. Objectives
9
2.5. Actions by DME
9
2.6. Reliance by Third Parties
9
2.7. Liability of Participants
9
 
 
Article III Capital
10
 
 
3.1. Contributions to Capital
10
3.2. Rights of Participants in Capital
10
3.3. Capital Accounts
10
3.4. Allocation of Net Profits and Net Losses
11
3.5. Allocations Relating to New Issues and Designated Securities
11
3.6. Allocation of Management Fee, Withholding Taxes and Certain Other
Expenditures
12
3.7. Reserves; Adjustments for Certain Future Events
13
3.8. Performance Allocation
14
3.9. Allocations for Income Tax Purposes
14
3.10. Qualified Income Offset
14
3.11. Gross Income Allocation
15
3.12. Individual Participants’ Tax Treatment
15
3.13. Distributions
15
 
 
Article IV Management
16
 
 
4.1. Duties and Powers of the Participants
16
4.2. Expenses
17
4.3. Other Activities of Participants
17
4.4. Duty of Care; Indemnification
18
4.5. Fiduciary Duties; Discretion
21
 
 
Article V Admissions and Withdrawals
21
 
 
5.1. Admission of Participants
21
5.2. Withdrawal of Interests of Participants
22
5.3. Transfer of Interests in Participants
23

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Article VI Termination and Liquidation
24
 
 
6.1. Termination of this Agreement
24
6.2. Liquidation of the Venture
25
 
 
Article VII Accounting and Valuations; Books and Records; Board Meetings
25
 
 
7.1. Accounting and Reports
25
7.2. Valuation of Assets and Interests
27
7.3. Determinations by DME
28
7.4. Books and Records
28
7.5. Greenlight Re or GRIL Board Meeting
29
 
 
Article VIII General Provisions
29
 
 
8.1. Amendment of Agreement
29
8.2. Notices
29
8.3. Agreement Binding Upon Successors and Assigns
31
8.4. Governing Law
31
8.5. Not for Benefit of Third Parties
31
8.6. Consents
31
8.7. Miscellaneous
31
8.8. Entire Agreement
32
 
 

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THIS SECOND AMENDED AND RESTATED AGREEMENT (the “Agreement”) is made as of this
1st day of January, 2014 by and among Greenlight Reinsurance, Ltd., incorporated
under the laws of the Cayman Islands as an exempted company with limited
liability and a holder of a Class D Insurer’s license issued in accordance with
the terms of the Insurance Law, 2010, of the Cayman Islands (“Greenlight Re”),
Greenlight Reinsurance Ireland, Ltd., Incorporated under the laws of Ireland as
a non-life reinsurer in accordance with the provisions of the European
Communities (Reinsurance) Regulation 2006 (“GRIL”) and DME Advisors, LLC, a
Delaware limited liability company (“DME”), and, solely for the purposes set
forth in Section 4.1(b) and (c), Greenlight Capital Re, Ltd. incorporated under
the laws of the Cayman Islands as an exempted company with limited liability
(“Greenlight Capital Re”);
WHEREAS, on January 1, 2008, Greenlight Re, DME Advisors, LP (“DMELP”) and
Greenlight Capital Re entered into an agreement, as amended by Amendment No. 1
dated as of February 20, 2009, and as amended and restated on August 31, 2010
(the “Original Agreement”) for the purpose of creating a joint venture solely
with respect to the management of certain investable assets and to share in the
profits and losses therefrom as described in this Agreement;
WHEREAS, the parties to the Original Agreement desire to amend and restate the
Original Agreement to (a) have DME join as a Participant (as defined below) in
place of DMELP, and (b) permit the venture (as defined below), to enter into the
Investment Advisory Agreement (as defined below) with DMELP;    
WHEREAS, (a) DME is willing to become a party to the Agreement, subject to the
terms and conditions stated herein, and (b) DMELP is willing to enter into the
Investment Advisory Agreement with the venture;
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the undersigned parties agree as follows:
_____________
Article I
Definitions
_____________
For purposes of this Agreement:
“Affiliate” means with respect to any Person, a Person that, directly or
indirectly through one or more intermediaries, controls, is controlled by or is
under common control with such Person. For these purposes, the term “control”
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of a Person, whether through the
ownership of voting Securities, by contract or otherwise.
“Agreement” means this Agreement, as amended from time to time.
“Assets” has the meaning set forth in Section 2.2.

    

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“Business Day” means any day on which banks are open for business in New York,
New York, Ireland and the Cayman Islands.
“Board” means with respect to each of GRIL or Greenlight Re such party’s full
board of directors, or, if required by law, regulation or securities exchange
upon which such party’s common shares are listed, an independent committee of
the Board; provided, however, that any such independent committee shall consist
of all members of such party’s board of directors that are not expressly
prohibited by applicable law, regulation or securities exchange from
participating in an action to be taken by the Board pursuant to this Agreement.
“Capital Account” means with respect to each Participant a memorandum account
established and maintained on behalf of such Participant as described in
Section 3.3.
“Carryforward Account” means a memorandum account to be recorded by DME in the
books and records of the venture with respect to each Participant that has an
initial balance of zero and that is adjusted as follows:
As of the first day after the close of each Performance Period for such
Participant (prior to giving effect to the Performance Allocation, if any), the
balance of the Carryforward Account (a) is increased by the amount, if any,
equal to two and one half times such Participant’s Negative Performance Change
for such Performance Period and (b) is reduced (but not below zero) by the
amount, if any, of such Participant’s Positive Performance Change for such
Performance Period.
“Code” means the U.S. Internal Revenue Code of 1986, as amended and as hereafter
amended, or any successor law.
“Commencement Date” means the first date on or as of which a Participant makes a
Capital Contribution to the venture pursuant to this Agreement. The Commencement
Date with respect to Greenlight Re is January 1, 2008, with respect to GRIL is
August 31, 2010, and with respect to DME is January 1, 2014.
“Company Act” means the U.S. Investment Company Act of 1940, as amended.
“Covered Person” means DME, and its members, partners, managers, directors,
officers, employees and agents, and any Person who controls DME.
“Designated Securities” means an Asset, designated as such by DME, either at the
time of acquisition or at a later date, in which a Participant has an ownership
interest different than its Percentage, which (a) may include no interest at all
for a Participant and (b) interest may not be on a pro rata basis. An Asset may
be designated as a Designated Security due to Guideline restrictions or for such
other reason as deemed appropriate by DME in its sole discretion.
“Effective Date” means January 1, 2014.
“ERISA” means the Employee Retirement Income Security Act of 1974, as the same
may be amended from time to time.

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“Final Determination” means (1) with respect to U.S. federal income taxes, a
“determination” (as defined in Section 1313(a) of the Code) or the execution of
a settlement agreement with the Internal Revenue Service (pursuant to
Form 870-AD or otherwise) and (2) with respect to taxes other than U.S. federal
income taxes, any judicial or administrative determination or settlement that is
substantially similar to a Final Determination described in clause (1).
“FINRA” means the Financial Industry Regulatory Authority (formerly known as the
National Association of Securities Dealers, Inc.)
“FINRA Rule 5130” means Rule 5130 promulgated by FINRA.
“Fiscal Period” means each period that starts on the Commencement Date (in the
case of the initial Fiscal Period) and thereafter on the first day immediately
following the last day of the preceding Fiscal Period, and that ends on the
earliest of the following dates:
(1)
the last day of any calendar month; or

(2)
any date as of which any withdrawal or distribution of capital is made by or to
any Participant or as of which this Agreement provides for any amount to be
credited to or debited against the Capital Account of any Participant, other
than a withdrawal or distribution by or to, or an allocation to the Capital
Accounts of, all Participants that does not result in any change of any
Participant’s Percentage; or

(3)
the date that immediately precedes any day as of which a contribution to capital
is made pursuant to this Agreement, other than a capital contribution that does
not result in any change of any Participant’s Percentage; or

(4)
any other date that DME, in its reasonable discretion, selects.

“Fiscal Year” means the period commencing on January 1 of each year and ending
on December 31 of such year.
“Force Majeure” shall mean fires, floods, acts of God or the public enemy,
interference by civil or military authorities, terrorist acts, governmental
actions, orders or requests.
“Greenlight Re Cause” means (i) a material violation of applicable law relating
to DME’s or DMELP’s advisory business, (ii) DME’s or DMELP’s gross negligence,
willful misconduct or reckless disregard of any of DME’s obligations under this
Agreement or DMELP’s obligations under the Investment Advisory Agreement,
(iii) a material breach by DME or DMELP of the Greenlight Re Guidelines, if such
breach is not cured within fifteen (15) days following the earlier of (a) the
date that DME or DMELP becomes aware of such breach and (b) the date on which
DME or DMELP receives written notification of such breach from Greenlight Re, or
(iv) a material breach by DME or DMELP of Section 5.2. For the avoidance of
doubt, any termination hereof by Greenlight Re for “Greenlight Re Cause” shall
require the approval of the Greenlight Re Board. Upon any termination of this
Agreement for “Greenlight Re Cause”, DME and DMELP will use all

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commercially reasonable efforts to follow the direction of the Greenlight Re
Board with respect to the disposition of the applicable Assets necessary to
satisfy Greenlight Re’s withdrawal; provided, however, that neither DME nor
DMELP makes any guarantee that they can comply with such directions.
“Greenlight Re Guidelines” has the meaning set forth in Section 4.1(h).
“GRIL Cause” means (i) a material violation of applicable law relating to DME’s
or DMELP’s advisory business, (ii) DME’s or DMELP’s gross negligence, willful
misconduct or reckless disregard of any of DME’s obligations under this
Agreement or DMELP’s obligations under the Investment Advisory Agreement,
(iii) a material breach by DME or DMELP of the GRIL Guidelines, if such breach
is not cured within fifteen (15) days following the earlier of (a) the date that
DME or DMELP becomes aware of such breach and (b) the date on which DME or DMELP
receives written notification of such breach from GRIL, (iv) a material breach
by DME or DMELP of Section 5.2, or (v) unsatisfactory long term performance of
DME or DMELP, as determined by the sole discretion of the Board of GRIL on each
anniversary date of this Agreement. For the avoidance of doubt, any termination
hereof by GRIL for “GRIL Cause” shall require the approval of the GRIL Board.
Upon any termination of this Agreement for “GRIL Cause”, DME and DMELP will use
all commercially reasonable efforts to follow the direction of the GRIL Board
with respect to the disposition of the applicable Assets necessary to satisfy
GRIL’s withdrawal; provided, however, that neither DME nor DMELP makes any
guarantee that they can comply with such directions.
“GRIL Guidelines” has the meaning set forth in Section 4.1(e).
“Guidelines” has the meaning set forth in Section 4.1(e).
“Interest” means all of the rights, obligations and interest(s) (in their
entirety) of a Participant in the venture at the relevant time, including the
right of such Participant to any and all benefits to which a Participant may be
entitled as provided in this Agreement and the obligations of such Participant
to comply with all the terms and provisions of this Agreement.
“Investment Advisory Agreement” means the Investment Advisory Agreement, dated
as of January 1, 2014, between DMELP and the venture.
“Losses” has the meaning set forth in Section 4.4(a).
“Managed Account” means assets managed by DME, DMELP or any of their Affiliates,
whether for its own account or for the account of any third party, that are
invested or available for investment in investment or trading activities.
“Management Fee” means with respect to each Participant other than DME, an
amount per month equal to 0.125% (an annual rate of 1.5%) of the Capital Account
balance of each such Participant.

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“Negative Performance Change” has the meaning set forth in the definition of
Performance Change.
“Net Assets” means the total value, as determined by DME in accordance with
Section 7.2, of the Assets (including net unrealized appreciation or
depreciation of the assets and accrued interest and dividends receivable net of
any withholding taxes), less an amount equal to all accrued debts, liabilities
and obligations chargeable against such Assets in accordance with this Agreement
(including any reserves for contingencies accrued pursuant to Section 3.7).
Except as otherwise expressly provided herein, Net Assets as of the first day of
any Fiscal Period shall be determined on the basis of the valuation of Assets
conducted as of the close of the immediately preceding Fiscal Period but after
giving effect to any capital contributions made by any Participant subsequent to
the last day of such immediately preceding Fiscal Period and Net Assets as of
the last day of any Fiscal Period shall be determined before giving effect to
any of the following amounts payable generally or in respect of any Securities
which payments or allocations are effective as of the date on which such
determination is made:
(1)
any withdrawals or distributions payable to any Participant that are effective
as of the date on which such determination is made;

(2)
any Management Fee or Performance Allocation as of the date on which such
determination is made; and

(3)
withholding taxes, expenses of processing withdrawals and other items payable,
any increases or decreases in any reserves or other amounts recorded pursuant to
Section 3.7, and any increases or decreases in the value of any New Issues
pursuant to Section 3.5 or in the value of any Designated Securities during the
Fiscal Period ending as of the date on which such determination is made, to the
extent DME reasonably determines that, pursuant to any provisions of this
Agreement, such items should be charged to one or more individual Participants
and not charged ratably to the Capital Accounts of all Participants on the basis
of their respective Percentages as of the commencement of the Fiscal Period.

“Net Loss” means any amount by which the Net Assets as of the first day of a
Fiscal Period exceed the Net Assets as of the last day of the same Fiscal
Period.
“Net Profit” means any amount by which the Net Assets as of the last day of a
Fiscal Period exceed the Net Assets as of the first day of the same Fiscal
Period.
“New Issue” has the meaning assigned to such term in Section 3.5(a) hereof.
“Participant” means any Person (other than Greenlight Capital Re) that is or
becomes a party to this Agreement, until the entire Interest of such Person has
been withdrawn pursuant to Section 5.2 or a substitute Participant or
Participants are admitted with respect to such Person’s entire Interest, or this
Agreement is terminated pursuant to Section 6.1 and the Assets distributed or
liquidated pursuant to Section 6.2.

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“Percentage” means a percentage established for each Participant as of the first
day of each Fiscal Period representing such Participant’s share of allocations
attributable to transactions involving the Capital Account for such Fiscal
Period. The Percentage of a Participant for a Fiscal Period is determined by
dividing the amount of the Participant’s Capital Account as of the beginning of
the Fiscal Period (excluding the value of Designated Securities and after
adjustment for all net contributions or withdrawals, Management Fee and
Performance Allocations that are effective as of such date) by the aggregate
Capital Accounts of all Participants as of the beginning of the Fiscal Period
(excluding the value of Designated Securities after adjustment for all net
contributions or withdrawals and Management Fee that are effective as of such
date). The sum of the Percentages of all Participants for each Fiscal Period
must equal 100%.
“Performance Allocation” means with respect to each Participant other than DME:
(1)
10% of the portion of the Positive Performance Change for such Participant’s
Capital Account, if any, determined as of the close of each Performance Period,
that is less than or equal to the positive balance in such Participant’s
Carryforward Account as of the most recent prior date as of which adjustment has
been made thereto; plus

(2)
20% of the portion of the Positive Performance Change for such Participant’s
Capital Account, if any, determined as of the close of each Performance Period
that exceeds the positive balance in such Participant’s Carryforward Account as
of the most recent prior date as of which adjustment has been made thereto.

“Performance Change” means, with respect to each Participant for each
Performance Period, the difference between:
(1)
the sum of (a) the balance of each such Participant’s Capital Account as of the
close of the Performance Period (after giving effect to all allocations to be
made to each such Participant’s Capital Account as of such date other than any
Performance Allocation to be debited against each such Participant’s Capital
Account), plus (b) any debits to each such Participant’s Capital Account during
the Performance Period to reflect any actual or deemed distributions or
withdrawals with respect to each such Participant’s Interest, plus (c) any
debits to each such Participant’s Capital Account during the Performance Period
to reflect any items allocable to each such Participant’s Capital Account
pursuant to Section 3.6(b) or Section 3.6(c) hereof; and

(2)
the sum of (a) the balance of each such Participant’s Capital Account as of the
commencement of the Performance Period, plus (b) any credits to such
Participant’s Capital Account during the Performance Period to reflect any
contributions by such Participant pursuant to this Agreement.

If the amount specified in clause (1) exceeds the amount specified in clause (2)
such difference is a “Positive Performance Change,” and if the amount specified
in clause (2) exceeds

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the amount specified in clause (1), the absolute value of such difference is a
“Negative Performance Change.”
“Performance Period” means, with respect to a Participant, the period commencing
as of the date that such Participant becomes a party to this Agreement (in the
case of such Participant’s initial Performance Period) and thereafter each
period commencing as of the day following the last day of the preceding
Performance Period with respect to such Participant, and ending as of the close
of business on the first to occur of the following after the relevant
commencement date:
(1)
the last day of a Fiscal Year;

(2)
the withdrawal or Transfer by a Participant of its entire Interest; or

(3)
termination of this Agreement pursuant to Section 6.1(a).

“Person” means any individual, partnership, corporation, limited liability
company, trust, or other entity.
“Positive Performance Change” has the meaning set forth in the definition of
Performance Change.
“Proceeding” has the meaning set forth in Section 3.12.
“Regulations” means the regulations issued under the Code or any successor law.
“Regulation 114 Trust” means a three way investment trust that (i) involves an
agreement among a cedent, a financial institution and a non-admitted reinsurer
governed by Regulation 114 of the Official Compilation of Codes, Rules and
Regulations (11 NYCRR4) of the New York State Insurance Department, (ii) is
maintained in the United States in an approved financial institution and
(iii) is collateralized only by cash and cash equivalents, U.S. Treasury
securities and/or fixed income securities rated “A” or higher.
“Restricted Capital Accounts” has the meaning assigned to such term in
Section 3.5(a) hereof.
“Securities” means equity and debt securities (including derivatives thereon),
currencies and commodities (and options, futures, derivatives, swaps, and
forward contracts thereon), trade and other claims, arbitrages, loans,
break-ups, consolidations, reorganizations and similar securities of non-United
States issuers, and everything connected therewith in the broadest sense.
“Tax Proceeding” has the meaning set forth in Section 3.12.
“Tax Treatment” has the meaning set forth in Section 3.12.
“Transfer” means any sale, exchange, transfer, assignment or other disposition
by a Participant of his Interest to another party, whether voluntary or
involuntary, including a transfer by operation of law. Notwithstanding the
foregoing, a pledge or lien by a Participant of any or all

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of its Interest made in accordance with, and permitted by, this Agreement shall
not be deemed to be a Transfer.
“Treasury Bill Rate” means, with respect to any calendar month, a rate of
interest, determined and adjusted monthly by DME as of the fifth Business Day of
each month, equal to the annual coupon equivalent yield on 13-week U.S. Treasury
bills resulting from the most recent auction of such instruments prior to the
monthly determination date.
“venture” has the meaning set forth in Section 2.1(c).
_____________
Article II
Organization
_____________
2.1.    Purpose of Agreement
(a)    The parties hereto hereby agree to form a joint venture to jointly own
and manage certain assets and to share in net profits and net losses generated
by these assets as more particularly described herein.
(b)    Each of the Participants hereby agrees, subject to the remainder of this
Agreement, to reasonably cooperate to carry out the intent of this Agreement and
to effectuate, implement and continue the valid and subsisting existence of the
relationship created hereby.
(c)    The parties hereto acknowledge that they intend that the joint venture
created by this Agreement be taxed as a partnership and not as an association
taxable as a corporation for United States federal income tax purposes and
references herein to the “venture” are references to such joint venture and tax
partnership. No election may be made by a Participant to treat the relationship
created by this Agreement as other than a partnership for United States federal
income tax purposes.
2.2.    Assets
From and after the Effective Date, the Participants acknowledge and agree that
(i) the assets of the venture (the “Assets”) will be jointly owned but held in
segregated accounts each in the name of Greenlight Re separate from Greenlight
Re’s other assets, and (ii) all of the Assets shall be held in trust for the
benefit of all Participants in accordance with the terms of this Agreement. DME
will select one or more custodians for the Assets and will promptly notify each
Participant in writing following the selection or change of custodians
hereunder.
2.3.    Term of Agreement
The term of this Agreement commences on the Commencement Date and continues,
unless earlier terminated pursuant to Section 6.1 hereof, until December 31,
2016; provided, however, that this Agreement shall automatically continue for
additional successive three-year periods unless

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DME notifies the other Participants that it wishes to terminate this Agreement
at least 90 days prior to the end of the then current term. In the event that
any Participant (other than DME) notifies the other Participants that it wishes
to withdraw as a Participant and terminate its participation in the venture at
least 90 days prior to the end of the then current term, the electing party
shall withdraw from the venture, and shall be deemed to have elected a
withdrawal of its entire Capital Account as of the end of such term as provided
for in Section 5.2 and the provisions of this Agreement shall no longer apply to
such Participant (except those provisions which by their terms apply to
Participants following their withdrawal).
2.4.    Objectives
The object and purpose of and the nature of the business to be conducted
pursuant to this Agreement is investing, acquiring, holding, voting, disposing
and otherwise dealing with the Securities consistent with the terms of this
Agreement (including, without limitation, the applicable Guidelines) and
engaging in any and all activities necessary or incidental to the foregoing.
2.5.    Actions by DME
Subject to the limitations contained elsewhere in this Agreement, DME, on behalf
of the Participants, may execute, deliver and perform all contracts, agreements
and other undertakings and engage in all activities and transactions as may, in
the reasonable discretion of DME, be necessary or advisable to carry out the
objectives of this Agreement (including without limitation all federal
securities filings relating to any of the investment activities set forth in the
Investment Advisory Agreement), provided, however, that if a contract, agreement
or other undertaking is or is to be made by DME on behalf of Greenlight Re
and/or GRIL that could reasonably be expected to require disclosure on a Form
8-K pursuant to Section 13 or 15(d) of the United States Securities Exchange Act
of 1934, as amended, or other applicable law, DME shall promptly notify
Greenlight Re and/or GRIL and cooperate with Greenlight Re and/or GRIL to allow
a timely and proper disclosure to be made. Notwithstanding the foregoing, each
of the Participants understands, acknowledges and agrees that DME will delegate
certain of the powers and authority granted to DME pursuant to this Section 2.5
to DMELP pursuant to the Investment Advisory Agreement.
2.6.    Reliance by Third Parties
Persons dealing with any Participant, individually or in the aggregate as it
relates to the Assets or the relationship created by this Agreement, are
entitled to rely conclusively upon the power and authority of each such
Participant as herein set forth.
2.7.    Liability of Participants
In no event will any Participant (or former Participant) be obligated to make
any capital contribution in addition to its agreed capital contributions (or
other payments provided for herein) or have any liability for the repayment or
discharge of debts and obligations of the venture except to the extent provided
herein or as required by law.

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_____________
Article III
Capital
_____________
3.1.    Contributions to Capital
(a)    As of August 31, 2010, GRIL made an initial contribution to the venture.
As of the Effective Date of this Agreement, DME will become a Participant.
(b)    Each Participant, as applicable, shall make additional capital
contributions in accordance with Section 3.6(b), Section 4.1(b) and 4.1(c)
hereof. In the event that DME’s Percentage falls below 1%, it shall promptly
(and in any event within five (5) Business Days of such occurrence) make a
capital contribution necessary to increase its Percentage to at least 1%. DME
shall not be required to make any other additional capital contributions, except
as otherwise specifically contemplated by this Agreement.
3.2.    Rights of Participants in Capital
(a)    No Participant is entitled to interest on any contributions made pursuant
to this Agreement.
(b)    No Participant has the right to the return of any contribution made
pursuant to this Agreement except (i) upon a withdrawal by a Participant
pursuant to Section 5.2 or (ii) upon the termination of this Agreement pursuant
to Section 6.1. The entitlement to any such return at such time is limited to
the value of the Capital Account of the Participant.
3.3.    Capital Accounts
(a)    Each Participant shall have a separate Capital Account relating to its
Interest.
(b)    Each Participant’s Capital Account shall have an initial balance equal to
the amount of any cash and the net value, as determined in accordance with
Section 7.2 hereof, of any assets constituting such Participant’s initial
contribution.
(c)    Each Participant’s Capital Account shall be increased by the amount of
cash and the net value, as determined in accordance with Section 7.2 hereof, of
any assets constituting additional contributions by such Participant and
decreased by the amount of cash and the net value of any assets withdrawn by and
distributed to such Participant and such Participant’s pro rata portion of the
expenses allocable pursuant to Section 4.2(a).
(d)    Each Participant’s Capital Account shall be adjusted in the manner
specified in the remaining provisions of Article III.

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3.4.    Allocation of Net Profits and Net Losses
(a)    Except as otherwise expressly provided herein, all capital contributions
by a Participant shall be credited to such Participant’s Capital Account, and
all withdrawals by or distributions to such Participant shall be debited from
such Participant’s Capital Account to the extent thereof. Subject to the
remaining provisions of this Section 3.4, Section 3.5, and Section 3.8 as of the
last day of each Fiscal Period, any Net Profit or Net Loss for such Fiscal
Period shall be allocated among and credited to or debited against the Capital
Accounts of the Participants in proportion to their respective Percentages for
such Fiscal Period.
(b)    Notwithstanding Section 3.4(a), items of income, gains, losses,
deduction, credit and expenses that relate to investments in New Issues and
Designated Securities shall be allocated pursuant to Section 3.5 below. DME
acknowledges that Greenlight Re holds a Class D Insurer’s license issued in
accordance with the terms of the Insurance Law, 2010, of the Cayman Islands and
that GRIL is a non-life reinsurer in accordance with the provisions of the
European Communities (Reinsurance) Regulations 2006.
3.5.    Allocations Relating to New Issues and Designated Securities
(a)    Pursuant to FINRA Rule 5130, the venture may only acquire certain
publicly-offered securities (“New Issues”) if the Capital Accounts of
Participants connected with the securities industry (“Restricted Capital
Accounts”) are restricted from sharing a beneficial interest in such New Issues
in accordance with the provisions of FINRA Rule 5130. Notwithstanding the
provisions of Section 3.4 above, to enable investment in New Issues, DME shall
not allocate any items of income, gain, loss, deduction and credit that relate
to investments in New Issues to Restricted Capital Accounts except to the extent
permitted by FINRA Rule 5130 and shall instead allocate such items among the
other Capital Accounts on a pro rata basis. To the extent that FINRA Rule 5130
permits certain persons with Restricted Capital Accounts to participate in New
Issues, DME will allocate such New Issue among such Restricted Capital Accounts
on a pro rata basis. DME may specially allocate a carrying charge to compensate
Participants with Restricted Capital Accounts to the extent such Restricted
Capital Accounts do not participate in investments in New Issues for the use of
capital to purchase or carry such positions. To the extent consistent with FINRA
Rule 5130, as amended from time to time, DME shall determine when all Capital
Accounts may participate in the Net Profit and Net Loss from any New Issue. DME
shall value any New Issue at such time at the then-current price of the security
in the secondary market.
(b)    DME may, in its discretion, elect to designate an Asset as a Designated
Security. Notwithstanding the provisions of Section 3.4 above, items of income,
gains, losses, deduction, credit and expense that relate to a Designated
Security shall be allocated to Capital Accounts in such percentages as DME shall
reasonably determine (taking into account each Participant’s Guidelines,
regulatory restrictions and other items deemed relevant by DME). Whenever DME
makes an investment that is in a Designated Security or whenever an existing
investment is first designated as a Designated Security by DME, DME shall
establish a sub-account with respect to each Participant that participates in
such Designated Security to reflect such Participant’s Capital

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Account’s pro rata share of all allocations and distributions attributable to
transactions involving such Designated Security. If DME determines that an
investment no longer warrants treatment as a Designated Security or that a
Participant may or must participate at a different percentage, DME will either
deem such investment no longer to be a Designated Security or reallocate
interest in the Designated Security to reflect the change in ownership
percentage. In the event of a withdrawal request by a Participant pursuant to
Section 5.2, DME shall have the discretion to effect such withdrawal request
first out of the Participant’s Capital Account (excluding the Designated
Securities sub-account) and then out of the Designated Security sub-account.
3.6.    Allocation of Management Fee, Withholding Taxes and Certain Other
Expenditures
(a)    As of the first day of each month, the Management Fee for such month
shall be debited against the Capital Account of each Participant (other than
DME) and paid in cash to DMELP pursuant to the Investment Advisory Agreement.
(b)    All applicable Management Fee accrues from the Commencement Date with
respect to each Participant and is payable monthly in advance on the first day
of the month, based on the Capital Account balance of each such Participant as
of the beginning of such month (or on the Commencement Date with respect to such
Participant in the case of the first month of this Agreement). If this Agreement
is terminated in accordance with its terms as of a date other than the last day
of a month, the Management Fee for the final month shall be prorated to the date
of termination. All payments of the Management Fee to DMELP pursuant to the
Investment Advisory Agreement shall be made without any reduction, deduction or
withholding for or on account of any tax (including without limitation, any
value added tax), unless required by law. If reduction, deduction or withholding
of any tax (including without limitation, any value added tax) is required by
law from any such payment, the sum payable shall be increased as necessary so
that after making all required deductions and withholdings, DMELP receives an
amount equal to the amount that it would have received had no such deductions or
withholdings been made.
(c)    If the venture or a Participant incurs a withholding tax or other tax
obligation with respect to the share of income allocable to any Participant,
then DME, on behalf of the venture or of such Participant, shall (unless
otherwise agreed by such Participant) withhold the appropriate portion of such
Participant’s share of income, timely remit such amount to the applicable taxing
authority and cause the amount of such obligation to be debited against the
Capital Account of such Participant as of the close of the Fiscal Period during
which such obligation was paid. If the amount of such taxes is greater than such
Capital Account balance, then such Participant and any successor to such
Participant’s Interest must, in connection with this Agreement, make a capital
contribution in the amount of such excess. No one other than the Participant is
obligated to apply for or obtain a reduction of or exemption from withholding
tax on behalf of any Participant that may be eligible for such reduction or
exemption but DME will provide any assistance reasonably requested by a
Participant, at such Participant’s cost, in connection with establishing any
such reduction or exemption. Notwithstanding the foregoing, DME shall bear the
financial obligation of any withholding or other tax obligation if the venture,
Greenlight Re or GRIL incurs such withholding or other tax obligation with
respect to the share of income allocable to Greenlight Re or GRIL, as the case
may be, that (i) Greenlight Re or GRIL, as the case may be, would not have been
subject

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to but for the establishment of, and the investment by, the venture, and
(ii) increases Greenlight Re’s or GRIL’s aggregate tax liability compared to
Greenlight Re’s or GRIL’s aggregate tax liability had the investment been made
by Greenlight Re or GRIL, directly or otherwise, outside of the venture.
(d)    Except as otherwise provided for in this Agreement, any expenditures
payable by or on behalf of the venture, to the extent determined by DME to have
been paid or withheld on behalf of, or by reason of particular circumstances
applicable to, one or more but fewer than all of the Participants, are to be
charged to only those Participants on whose behalf such payments are made or
whose particular circumstances gave rise to such payments. Such charges are
debited from the Capital Accounts of such Participants as of the close of the
Fiscal Period during which any such items were accrued or paid.
3.7.    Reserves; Adjustments for Certain Future Events
(a)    Appropriate reserves may be created, accrued and charged against the Net
Assets and proportionately against the Capital Accounts of the Participants for
contingent liabilities associated with the venture, including, without
limitation, for accrued Performance Allocation amounts, such reserves to be in
the amounts that DME, in its reasonable discretion, deems necessary or
appropriate. DME may increase or reduce any such reserve from time to time by
such amounts as DME in its reasonable discretion deems necessary or appropriate.
At the reasonable discretion of DME, the amount of any such reserve, or any
increase or decrease therein, may be charged or credited, as appropriate, to the
Capital Accounts of those parties who are Participants at the time when such
reserve is created, increased, or decreased, as the case may be, or
alternatively may be charged or credited to those parties who were Participants
at the time of the act or omission giving rise to the contingent liability for
which the reserve was established.
(b)    If DME in its reasonable discretion determines that it is equitable to
treat an amount to be paid or received as being applicable to one or more prior
periods, then such amount may be proportionately charged or credited, as
appropriate, to those parties who were Participants during such prior period or
periods. If any amount is to be charged or credited to a party who is no longer
a Participant, such amount must be paid by (in the case of a charge) or to (in
the case of a credit) such party, as the case may be, in cash with interest at
the Treasury Bill Rate in effect at that time from the date on which DME
determines that such charge or credit is required. In the case of a charge, the
former Participant is obligated to pay the amount of the charge, or if another
Participant has already paid the charge, to reimburse such other Participant
promptly on demand; provided that (i) in no event is a former Participant
obligated to make a payment exceeding the amount of its Capital Account at the
time to which the charge relates, and (ii) no such demand may be made if the
applicable limitation period under applicable law, if any, has expired. To the
extent DME or the Participants fail to collect, in full, any amount required to
be charged to such former Participant pursuant to paragraph (a) or (b) of this
Section 3.7, whether due to the expiration of the applicable limitation period,
if any, or for any other reason whatsoever, the deficiency may be charged
proportionately to the Capital Accounts of the current Participants.
(c)    In the event any reserves in excess of $100,000 are created, accrued or
charged against the Net Assets of Greenlight Re’s Capital Account, or any such
reserves in excess of $100,000

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are increased or decreased, DME will promptly, within five (5) Business Days
following month end, provide written notice and a description of such event to
Greenlight Re. In the event any reserves in excess of $100,000 are created,
accrued or charged against the Net Assets of GRIL’s Capital Account, or any such
reserves in excess of $100,000 are increased or decreased, DME will promptly,
within five (5) Business Days following month end, provide written notice and a
description of such event to GRIL.
3.8.    Performance Allocation
(a)    The Performance Allocation shall be debited against the Capital Account
of each Participant (other than DME) as of the last day of each Performance
Period with respect to such Participant, and the amount so debited shall be
simultaneously credited to the Capital Account of DME.
(b)    DME, in its sole discretion, may waive or reduce the Performance
Allocation.
3.9.    Allocations for Income Tax Purposes
(a)    Except as otherwise required by Code Section 704(c), items of income,
gain, deduction, loss, or credit that are recognized for income tax purposes in
each Fiscal Year shall be allocated among the Participants, in such manner as to
reflect equitably amounts credited to or debited against each Participant’s
Capital Account, whether in such Fiscal Year or in prior Fiscal Years. To this
end, DME shall establish and maintain records that show the extent to which the
Capital Account of each Participant, as of the last day of each Fiscal Year,
consists of amounts that have not been reflected in the taxable income of such
Participant. To the extent deemed by DME, in its reasonable discretion, to be
feasible and equitable, taxable income and gains in each Fiscal Year shall be
allocated among the Participants who have enjoyed the related credits to their
Capital Accounts, and items of deduction, loss and credit in each Fiscal Year
shall be allocated among the Participants who have borne the burden of the
related debits to their Capital Accounts.
(b)    To the extent an adjustment to the adjusted tax basis of any Asset or any
Capital Account pursuant to Code Section 734(b) is required under Regulations
Sections 1.704-1(b)(2)(iv)(m)(4) and (5) to be taken into account in determining
Capital Accounts, the amount of such adjustment to the Capital Accounts shall be
treated as an item of gain (if the adjustment increases the basis of the asset)
or loss (if the adjustment decreases such basis) and such gain or loss shall be
specially allocated to the Participants in the same manner that the gain or loss
displaced by such basis adjustment would have been allocated had the assets in
question been sold.
3.10.    Qualified Income Offset
In the event any Participant receives any adjustments, allocations, or
distributions described in Section 1.704-1(b)(2)(ii)(d)(4),
1.704-1(b)(2)(ii)(d)(5), or 1.704 1(b)(2)(ii)(d)(6) of the Regulations, items of
income and gain will be specially allocated to each such Participant in an
amount and manner sufficient to eliminate, to the extent required by the
Regulations, the deficit balance in the Capital Account of such Participant as
quickly as possible, provided that an allocation pursuant to this Section 3.10
may be made only if and to the extent that such Participant would have

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a deficit balance in its Capital Account after all other allocations provided
for in this Article III have been tentatively made as if this Section 3.10 were
not in the Agreement. This Section 3.10 is intended to constitute a “qualified
income offset” within the meaning of Regulations Section 1.704-1(b)(2)(ii), and
must be interpreted consistently therewith.
3.11.    Gross Income Allocation
In the event any Participant has a deficit Capital Account at the end of any
Fiscal Year that is in excess of the sum of (i) the amount such Participant is
obligated to restore pursuant to any provision of this Agreement and (ii) the
amount such Participant is deemed to be obligated to restore pursuant to the
penultimate sentences of Regulations Section 1.704-2(g)(1) and 1.704-2(i)(5),
each such Participant will be specially allocated items of income and gain in
the amount of such excess as quickly as possible, provided that an allocation
pursuant to this Section 3.11 may be made only if and to the extent that such
Participant would have a deficit Capital Account in excess of such sum after all
other allocations provided for in this Article III have been made as if
Section 3.10 hereof and this Section 3.11 were not in the Agreement.
3.12.    Individual Participants’ Tax Treatment
(a)    Except with regard to the treatment of the venture as a partnership for
U.S. tax purposes and the treatment of the Performance Allocation as
contemplated by this Agreement (“Tax Treatment”), each Participant agrees not to
treat, on any income tax return or in any claim for a refund, any item of
income, gain, loss, deduction or credit in a manner inconsistent with the
treatment of such item pursuant to the terms of this Agreement unless otherwise
required by a Final Determination after such Participant uses its commercially
reasonable efforts to uphold the treatment of the item in a manner consistent
with the terms of this Agreement.
(b)    Notwithstanding the foregoing, the parties shall not take any position
inconsistent with the Tax Treatment. If a claim, action or proceeding (a “Tax
Proceeding”) is brought by the Internal Revenue Service or other taxing
authority against a Participant or the venture challenging the Tax Treatment,
such Participant shall provide prompt written notice to DME of such Tax
Proceeding and DME shall be entitled to assume the defense of, and control all
matters with regard to, such Tax Proceeding as it relates to the Tax Treatment
in accordance with the procedures set forth in Section 4.4(e). DME shall
indemnify such Participant for any losses, damages, costs and expenses
associated with any such Tax Proceeding in accordance with Section 4.4 of this
Agreement whether or not it assumes the defense. DME shall use reasonable
efforts to keep such Participant apprised of the status of such Tax Proceeding.
No Participant may settle a Tax Proceeding inconsistent with the Tax Treatment
contemplated by this Agreement unless DME fails to assume or maintain the
defense of the Tax Proceeding as contemplated by this Section 3.12(b) and
Section 4.4(e), or DME provides express prior written consent.
3.13.    Distributions
(a)    Subject to Section 5.2, the amount, form and timing of any distributions
pursuant to this Agreement are determined by DME.

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(b)    Notwithstanding any provision to the contrary contained in this
Agreement, DME may not make a distribution to any Participant on account of such
Participant’s Interest if such distribution would violate any applicable law.
_____________
Article IV
Management
_____________
4.1.    Duties and Powers of the Participants
(a)    Notwithstanding anything to the contrary in this Agreement, DME shall use
commercially reasonable efforts to avoid engaging in any activity or taking any
action that would cause Greenlight Re or GRIL to be treated as engaged in a U.S.
trade or business for U.S. federal income tax purposes, including investing in
any asset that (i) does not qualify for the trading safe harbor provided in
Section 864(b)(2) of the Code and the Treasury Regulations promulgated
thereunder, or (ii) would be considered a United States real property interest
for purposes of Section 897 of the Code.
(b)    During the term of this Agreement none of Greenlight Capital Re,
Greenlight Re or GRIL shall engage a person or entity, other than DME or DMELP
or, with the prior written consent of DME, a DME Affiliate, to act as its
investment advisor or in a similar capacity. In furtherance of the foregoing,
during the term of this Agreement, each of Greenlight Re and GRIL shall use its
respective commercially reasonable efforts to cause substantially all of its
investable assets to be contributed to the venture as soon as reasonably
practicable; provided, however, that the term “investable assets” shall not be
deemed to include (i) any assets of Greenlight Re which are, in the good faith
determination of the Board of Greenlight Re, necessary for the operation of
Greenlight Re’s business; (ii) up to 10% (20% if approved by the Board of
Greenlight Re, and communicated in writing to DME) of Greenlight Re’s assets
that are available for investment that are used to collateralize Regulation 114
Trusts; (iii) any assets of GRIL which are, in the good faith determination of
the Board of GRIL, necessary for the operation of GRIL’s business; and (iv) up
to 10% (20% if approved by the Board of GRIL, and communicated in writing to
DME) of GRIL’s assets that are available for investment that are used to
collateralize Regulation 114 Trusts.
(c)    During the term hereof (including, for the avoidance of doubt, during any
renewal term), Greenlight Re, GRIL and Greenlight Capital Re shall, and shall
use their respective commercially reasonable efforts to cause any of their
respective subsidiaries that are formed before or after the date hereof to
(i) become a Participant or (ii) enter into an agreement similar to this
Agreement, in each case relating to the investment of substantially all of their
investable assets.
(d)    DME shall be the tax matters partner for purposes of this Agreement and
Section 6231(a)(7) of the Code. The tax matters partner has the exclusive
authority and discretion to make any elections required or permitted to be made
by the venture under any provisions of the Code or any other applicable laws.

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(e)    Notwithstanding any provision of this Agreement to the contrary, DME
hereby agrees to follow (i) the investment guidelines of Greenlight Re attached
hereto as Exhibit A-1 (the “Greenlight Re Guidelines”), solely with respect to
Assets in which Greenlight Re has an interest, and only to the extent of
Greenlight Re’s interest in each such Asset, as the Greenlight Re Guidelines may
be amended from time to time by the Board of Greenlight Re, and provided in
writing to DME or DMELP, and (ii) the investment guidelines of GRIL attached
hereto as Exhibit A-2 (the “GRIL Guidelines”, and together with the Greenlight
Re Guidelines, the “Guidelines”), solely with respect to Assets in which GRIL
has an interest, and only to the extent of GRIL’s interest in each such Asset,
as the GRIL Guidelines may be amended from time to time by the Board of GRIL and
provided in writing to DME or DMELP. For the avoidance of doubt, the Parties
hereby acknowledge and agree that (x) the Greenlight Re Guidelines do not apply
to any Assets in which Greenlight Re does not have an interest, and (y) the GRIL
Guidelines do not apply to any Assets in which GRIL does not have an interest.
DME shall not, except as otherwise approved by Greenlight Re or GRIL in writing,
effect any investment transactions for the accounts of such Participant that are
inconsistent with the Guidelines applicable to such Participant or other
investment restrictions from time to time imposed by applicable regulation (as
determined in good faith by the applicable Board) or adopted by the applicable
Board; provided that such Guidelines and investment restrictions are
communicated in writing to DME or DMELP. DME may designate certain investments
as Designated Securities in order to comply with the applicable Guidelines and
investment restrictions.
4.2.    Expenses
(a)    DMELP shall be entitled to reimbursement of expenses as provided in the
Investment Advisory Agreement. Expenses generally will be borne pro rata by the
Participants in accordance with the balances in their respective Capital
Accounts, except as provided elsewhere in this Agreement, including
Sections 3.4, 3.5, 3.6, and 3.9.
(b)    The venture does not have its own separate employees or office, and no
Participant is entitled to reimbursement for salaries, office rent and other
general overhead costs of such Participant in connection with this Agreement.
4.3.    Other Activities of Participants
(a)    DME is not required to devote its full time to its duties under this
Agreement, but must devote such of its time to such duties as it, in its
discretion exercised in good faith, determines to be necessary to conduct the
affairs contemplated by this Agreement.
(b)    This Agreement shall not restrict in any way the ability of DME or its
Affiliates to engage in any other business or investment activities. It is
expressly understood that DME and its Affiliates may effect investment
transactions for their own account and for Managed Accounts which may or may not
be affiliated with any Participant, and the Participants further understand and
agree that nothing herein shall restrict the ability of DME or its Affiliates to
engage in any such transactions notwithstanding the fact that the Participants
may have, by virtue of this Agreement or otherwise, or may take a position of
any kind; provided, however, that DME shall not, without the prior written
consent of the applicable Board, purchase pursuant to this Agreement any Asset
from, or sell pursuant to this Agreement, any Asset to, DME or any Managed
Account which DME

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or an Affiliate is the investment advisor to or is otherwise a beneficial owner
of; provided further, however, that failure to obtain such prior written consent
shall not be deemed a breach of this Agreement if the applicable Board ratifies
such purchase or sale after the fact. Notwithstanding the foregoing, DME may
cause the venture and Managed Accounts that invest in parallel therewith to
enter into book account trades in the ordinary course of business transferring
portions of investments among the venture and all such Managed Accounts in order
to reflect changes in the size of the venture relative to the size of such
Managed Accounts without the need for consent or ratification by the Board of
any such trades.
(c)    It is understood that when DME determines that it would be appropriate
for the venture and one or more of DME’s (or its Affiliates’) other Managed
Accounts to participate in an investment opportunity, DME will seek to execute
orders for, or otherwise allocate such opportunities to, the venture and such
Managed Accounts on an equitable basis. In such situations, DME may place orders
for the venture and each Managed Account simultaneously and if all such orders
are not filled at the same price, DME may cause the venture and each Managed
Account to pay or receive the average of the prices at which such orders were
filled for the venture and all other Managed Accounts. If all such orders cannot
be fully executed under prevailing market conditions, DME may allocate among the
venture and the Managed Accounts the securities traded in a manner which DME
considers in its reasonable discretion equitable, taking into account the size
of the order placed for the venture and each such Managed Account as well as any
other factors which DME deems relevant. However, DME is not obligated to devote
any specific amount of time to its duties under this Agreement and is not
required to accord exclusivity or priority to the venture or the Participants in
the event of limited investment opportunities arising from the application of
speculative position limits or other factors.
4.4.    Duty of Care; Indemnification
(a)    Each Participant agrees that no Covered Person shall be liable to the
venture or to any of the Participants or their shareholders for any liabilities,
obligations, losses, costs, damages, expenses, claims, judgments and reasonable
attorney’s fees and expenses (collectively, “Losses”) occasioned by any act or
omission of any Covered Person in connection with the performance of such
Covered Person’s services hereunder, except that DME shall be liable to the
Participants: (i) for any misstatement or omission of material fact contained in
a filing made by or on behalf of a Participant under the United States
Securities and Exchange Act of 1934 or other federal law or other public
disclosure in so far as such losses, damages, expenses or claims arise out of or
are based upon any written information provided by such Covered Person regarding
the Participants or the venture expressly for use in such filing or other public
disclosure, to the extent (and only to the extent) that such misstatement or
omission of a material fact contained in such filing occurs in reliance upon and
in conformity with the written information furnished by the Covered Person;
(ii) for acts or omissions by it which constitute gross negligence, willful
misconduct or reckless disregard of DME’s obligations under this Agreement,
(iii) for breaches of the applicable Guidelines by DME which are not cured
within 15 days of the earlier of (x) the date on which DME becomes aware of such
breach, and (y) the date on which DME receives a written notice of such breach
from a Participant or an authorized representative of a Participant; or (iv) for
breaches of Section 5.2

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hereof, in each case as finally determined by a court having proper jurisdiction
and after all appeals are resolved or exhausted.
(b)    Each Participant, to the extent of its interest in the Assets only, shall
indemnify and hold harmless each Covered Person from and against any Losses
arising out of any claim asserted or threatened to be asserted in connection
with any matter arising out of or in connection with this Agreement or the
venture’s business or affairs; provided, however, that no Covered Person shall
be entitled to any such indemnification with respect to any expense, loss,
liability or damage which was caused by (i) any misstatement or omission of
material fact contained in a filing made by or on behalf of a Participant under
the United States Securities and Exchange Act of 1934 or other federal law or
other public disclosure in so far as such losses, damages, expenses or claims
arise out of or are based upon any written information provided by such Covered
Person regarding the Participants or the venture expressly for use in such
filing or other public disclosure, to the extent (and only to the extent) that
such misstatement or omission of a material fact contained in such filing occurs
in reliance upon and in conformity with the written information furnished by the
Covered Person, (ii) any Covered Person’s gross negligence, willful misconduct
or reckless disregard of any of the its obligations under this Agreement,
(iii) for breaches of the applicable Guidelines by DME in connection with its
actions under this Agreement which breaches are not cured within 15 days of the
earlier of (x) the date on which DME becomes aware of such breach, and (y) the
date on which DME receives a written notice of such breach from a Participant;
or (iv) for breaches of Section 5.2 hereof. The venture shall advance to any
Covered Person the reasonable costs and expenses of investigating and/or
defending such claim subject to receiving a written undertaking from the Covered
Person to repay such amounts if and to the extent of any subsequent
determination by a court or other tribunal of competent jurisdiction that the
Covered Person was not entitled to indemnification hereunder. Notwithstanding
the foregoing, no Participant shall be liable hereunder for any settlement of
any action or claim effected without its consent thereto, which will not be
unreasonably withheld.
(c)    All transactions effected pursuant to this Agreement by DME shall be for
the Participants’ accounts and risk. DME has not made and makes no guarantee
whatsoever as to the success or profitability of DME’s trading methods and
strategies, and the Participants each acknowledge that it has received no such
guarantee from DME or any Covered Person, and has not entered into this
Agreement in consideration of or in reliance upon any such guarantee or similar
representation from DME or any Covered Person.
(d)    DME shall indemnify and hold harmless each of the Participants against
any Losses which were caused by: (i) any misstatement or omission of material
fact contained in a filing made by or on behalf of a Participant under the
United States Securities and Exchange Act of 1934 or other federal law or other
public disclosure in so far as such losses, damages, expenses or claims arise
out of or are based upon any written information provided by DME regarding the
Participants or the venture expressly for use in such filing or other public
disclosure, to the extent (and only to the extent) that such misstatement or
omission of a material fact contained in such filing occurs in reliance upon and
in conformity with the written information furnished by DME; (ii) DME’s fraud,
gross negligence, willful misconduct or reckless disregard of any of DME’s
obligations under this Agreement; (iii) for breaches of the applicable
Guidelines by DME in connection with its duties

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under this Agreement which breaches are not cured within 15 days of the earlier
of (x) the date on which DME becomes aware of such breach, and (y) the date on
which DME receives a notice of such breach from a Participant; or (iv) for
breaches of Section 5.2 hereof; or (v) any Tax Proceeding.
(e)    If a Participant shall receive notice of or has actual knowledge of any
Tax Proceeding, such Participant shall give DME written notice of such Tax
Proceeding; provided, however, that failure to notify DME shall not relieve DME
from any liability which it may have on account of the Tax Proceeding except to
the extent that DME shall have been materially prejudiced by such failure. DME
shall be entitled to assume control of the defense or settlement of such matter.
If DME elects to assume such control, the Participant being indemnified and its
counsel shall be entitled to consult with DME and its counsel and participate in
the defense or settlement of such matter at its own cost; provided, however,
that DME shall bear the costs and expenses of such Participant’s counsel (from
one law firm) if, in the reasonable opinion of counsel mutually acceptable to
the parties hereto, use of such Participant’s counsel is necessary as a result
of a conflict of interest between the Participant, on the one hand, and DME, on
the other hand. In any event, DME shall indicate in writing to the Participant
being indemnified within 10 calendar days after such Participant has given DME
written notice whether DME intends to pay the claim or assume control of the
defense or settlement of such matter.
In the event DME exercises its right to assume control of the defense, the
Participant being indemnified shall reasonably cooperate with DME in such
defense and make available to DME witnesses, pertinent records, materials and
information in its possession or under its control relating thereto as are
reasonably requested by DME. No claim may be settled by DME without the written
consent of such Participant, which consent shall not be unreasonably withheld or
delayed; provided, however, that DME may settle such claim without the consent
of such Participant so long as the settlement (x) includes an unconditional
release of such Participant, in form and substance reasonably satisfactory to
such Participant, from the claimant, (y) does not impose any liabilities or
obligations on such Participant, and (z) with respect to any non-monetary
provision of any settlement of a claim, does not impose and conditions upon such
Participant.
(f)    The amount which any indemnifying party is required to pay to, or for the
benefit of, an indemnified person under this Section 4.4 will be reduced
(including, without limitation, retroactively) by any insurance proceeds which
are actually paid by, or on behalf of, the indemnified party in reduction of the
related Losses.
(g)    If the indemnity provided for in Section 4.4 and to which an Covered
Person is otherwise entitled is unavailable to such Covered Person in respect of
any Losses referred to therein, then each Participant, to the extent of its
interest in the Assets only, in lieu of indemnifying such Covered Person, shall
contribute to the amount paid or payable by such Covered Person as a result of
such Losses in the proportion the total capital of the Participants in the
venture (exclusive of the balance in the Covered Person’s Capital Account (or
the Capital Account of DME if the Covered Person is not DME)) bears to the total
capital of the venture (including the balance in Covered Person’s Capital
Account (or the Capital Account of DME if the Covered Person is not DME), which
contribution shall be treated as an expense of the venture calculated as if the
DME’s Capital Account balance was equal to zero.

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4.5.    Fiduciary Duties; Discretion
(a)    To the extent that, at law or in equity, a Covered Person has duties
(including fiduciary duties) and liabilities relating thereto to the venture or
to any Participant, such Covered Person acting under this Agreement is not
liable to the venture or to any Participant for its good faith reliance on the
provisions of this Agreement. The provisions of this Agreement, to the extent
that they restrict the duties and liabilities of a Covered Person otherwise
existing at law or in equity, are agreed by the parties hereto to replace such
other duties and liabilities of such Covered Person.
(b)    To the fullest extent permitted by law, unless otherwise expressly
provided for herein, (i) whenever a conflict of interest exists or arises
between a Participant or any of its Affiliates, on the one hand, and the venture
or any of the other Participants on the other hand, or (ii) whenever this
Agreement or any other agreement contemplated herein or therein provides that a
Participant must act in a manner which is, or provide terms which are, fair and
reasonable, the Participant must resolve such conflict of interest, take such
action or provide such terms, considering in each case the relative interest of
each party, including its own interest, to such conflict, agreement, transaction
or situation and the benefits and burdens relating to such interests, any
customary or accepted industry practices, and any applicable generally accepted
accounting practices or principles. In the absence of bad faith by the
Participant, the resolution, action or terms so made, taken or provided by the
Participant do not constitute a breach of this Agreement or any other agreement
contemplated herein or of any duty or obligation of the Participant at law or in
equity or otherwise.
(c)    To the fullest extent permitted by law, except as provided elsewhere in
this Agreement, whenever in this Agreement a Person is permitted or required to
make a decision (i) in its “sole discretion” or under a grant of similar
authority or latitude, such Person is entitled to consider only such interests
and factors as it desires, including its own interests, and has no duty or
obligation to give any consideration to any interest of or factors affecting the
venture or the Participants, or (ii) in its “good faith” or under another
express standard, then such Person acts under such express standard and is not
subject to any other or different standards imposed by this Agreement or any
other agreement contemplated herein or by relevant provisions of law or in
equity or otherwise.
_____________
Article V
Admissions and Withdrawals
_____________
5.1.    Admission of Participants
The Participants may by unanimous written consent, on the first day of any
calendar month, or at such other times as the Participants may determine, admit
any Person who executes this Agreement or any other writing evidencing the
intent of such Person to become a Participant, unless the participation by such
Participant would have any of the effects described in clauses (i) through (vi)
of Section 5.3(c).

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5.2.    Withdrawal of Interests of Participants
(a)    The Interest of a Participant may not be withdrawn prior to termination
of this Agreement except as provided in this Section 5.2.
(b)    Subject, in the case of DME, to its requirement to maintain at least a 1%
interest pursuant to Section 3.1 hereof and subject to the obligations of the
other Participants set forth in Section 4.1(b), a Participant may voluntarily
withdraw all or part of its Capital Account as of the close of business on any
Business Day. If a Participant wishes to withdraw funds, it must give written
notice to DME at least 3 Business Days prior to the proposed withdrawal date
indicating the amount to be withdrawn from such Participant’s Capital Account in
such notice. DME may with respect to such request, in its reasonable discretion,
waive the foregoing notice requirement. DME shall not be liable for failure to
perform or delay in performing under this Section 5.2 when such failure or delay
is due to Force Majeure, so long as DME uses its commercially reasonable efforts
to cure such event or occurrence as soon as practicably as possible. Upon
receipt by DME of a Participant’s notice of intention to withdraw assets from
the venture, DME shall have the discretion to manage the Assets in a manner that
would provide for cash being available to satisfy such Participant’s request for
withdrawal. DME may effect withdrawal payments (i) in cash, (ii) in kind, or
(iii) in any combination of the foregoing; provided that the DME will use its
commercially reasonable efforts to make any such settlement in cash unless
otherwise requested by the Participant. Notwithstanding the foregoing, each of
the Participants acknowledges that a substantial amount of withdrawals by one or
more Participants could require DME to liquidate positions in order to raise
cash necessary to fund the withdrawals at a time when market conditions are
adverse or when such liquidations are otherwise not in the best interests of
non-withdrawing Participants.
(c)    The right of any Participant to withdraw or of any Participant to have
distributed an amount from his Capital Account pursuant to the provisions of
this Section 5.2 is subject to the provision by DME, on behalf of the
Participants, for all of the venture’s liabilities and for reserves for
contingencies provided for in Section 3.7 and Section 4.4 herein.
(d)    With respect to any amounts withdrawn, a withdrawing Participant does not
share in the income, gains and losses resulting from the venture or have any
other rights or obligations as a Participant after the effective date of its
withdrawal except as provided in Section 3.7 and Section 4.4.
(e)    Notwithstanding any provision of this Agreement to the contrary (i)
Greenlight Re may withdraw as a Participant and fully withdraw all of its
Capital Account from the venture (x) on 3 Business Days notice if Greenlight Re
Cause exists or (y) at the end of the then current term of the Agreement if
Greenlight Re elects not to renew the term of the Agreement pursuant to Section
2.3, and (ii) GRIL may withdraw as a Participant and fully withdraw all of the
GRIL Assets from the venture (x) on 3 Business Days notice if GRIL Cause exists
or (y) at the end of the then current term of the Agreement if GRIL elects not
to renew the term of the Agreement pursuant to Section 2.3.
(f)    In the event that a Participant shall have withdrawn from the venture
pursuant to Section 5.2(e), (i) such Participant shall no longer be considered a
Participant from and after the

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date of such complete withdrawal, and (ii) the provisions of this Agreement
shall no longer apply to such Participant (except those provisions which by
their terms apply to Participants following their withdrawal).

5.3.    Transfer of Interests in Participants
(a)    Each Participant agrees that it will not make or attempt to make any
Transfer of its Interest that would violate this Section 5.3. In the event of
any attempted Transfer of any Participant’s Interest in violation of the
provisions of this Section 5.3, without limiting any other rights of DME under
this Agreement or otherwise, such attempted transfer shall be void ab initio and
DME (or, in the case of a transfer by DME, the other Participants) shall have
the right to require the withdrawal of such Participant’s Interest.
(b)    No Transfer of any Participant’s Interest, whether voluntary or
involuntary, is valid or effective, and no transferee becomes a substituted
Participant, unless the prior written consent of DME (or, in the case of a
transfer by DME, a majority in interest) of the other Participants has been
obtained, which consent may be withheld for any reason or for no reason in the
sole discretion of DME or such Participants; provided, however, that in the case
of DME, DME may make an assignment in a transaction that does not result in a
change of its actual control or management. In the event of any Transfer, all of
the conditions of the remainder of this Section 5.3 must also be satisfied.
(c)    No Transfer of any Participant’s Interest, whether voluntary or
involuntary, is valid or effective unless DME (or, in the case of a transfer by
DME, a majority in interest of the other Participants) in its or their sole
discretion determines, after consultation with legal counsel, that such Transfer
will not:
(i)
require registration of any Interest under any securities laws of the United
States of America, any state thereof or any other jurisdiction;

(ii)
subject the venture or the Participants to a requirement to register under any
securities or commodities laws of the United States of America, any state
thereof or any other jurisdiction;

(iii)
cause the venture to be treated as a “publicly traded partnership” for U.S.
federal income tax purposes under Section 7704(b) of the Code;

(iv)
result in the venture being considered an investment company under the Company
Act;

(v)
violate or be inconsistent with any representation or warranty made by the
transferring Participant at the time the Participant purchased an Interest; or

(vi)
result in Assets being considered “plan assets” for purposes of ERISA.

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(d)    The transferring Participant must give the other Participants written
notice before making any voluntary Transfer and after any involuntary Transfer
and must provide sufficient information to allow DME to make the determination
that the proposed Transfer will not result in any of the consequences referred
to in clauses (i) through (vi) above.
(e)    Any other provision of this Agreement to the contrary notwithstanding,
any successor to any Participant’s Interest is bound by the provisions hereof.
Prior to recognizing any Transfer in accordance with this Section 5.3, the other
Participants in their sole discretion may require the transferring Participant
to execute and acknowledge an instrument of transfer in form and substance
satisfactory to the Participants, and may require the transferee to make certain
representations and warranties to the Participants and to accept, adopt and
approve in writing all of the terms and provisions of this Agreement. A
transferee becomes a substituted Participant and succeeds to the portion of the
transferor’s Capital Account relating to the Interest transferred effective upon
the satisfaction of all of the conditions for such Transfer contained in this
Section 5.3.
(f)    Notwithstanding the foregoing, the Participants acknowledge that
Greenlight Re or GRIL has or may in the future enter into financing arrangements
pursuant to which it may grant to lenders a security interest in its rights to
its portion of the Assets. DME agrees to reasonably cooperate with Greenlight Re
or GRIL to effect the granting of such security interests, including without
limitation, executing a pledge agreement or similar agreement on reasonably
acceptable terms including if possible the right to foreclose on a portion of
those Assets equal to the Participant’s percentage interest in the Assets
(taking into account that a Participant may not participate fully in certain
Designated Securities or New Issues), after accounting for liabilities and
reserves. Each of Greenlight Re and GRIL agrees not to pledge more than its
percentage interest in any Assets.
_____________
Article VI
Termination and Liquidation
_____________
6.1.    Termination of this Agreement
(a)    Subject to applicable law, this Agreement will terminate and its affairs
must be wound up upon the earliest of:
(i)
the end of the term of this Agreement, as determined pursuant to Section 2.3
hereof; and

(ii)
the date on which only one Participant remains.

(b)    Except as provided in Section 6.1(a) or applicable law, the death, mental
illness, dissolution, termination, liquidation, bankruptcy, reorganization,
merger, sale of substantially all of the stock or assets of or other change in
the ownership or nature of a Participant, the execution of a joinder agreement
to this Agreement by a new Participant, the withdrawal of a Participant, or the
transfer by a Participant of its Interests to a third party does not cause this
Agreement to terminate.

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6.2.    Liquidation of the Venture
(a)    Upon termination of this Agreement pursuant to Section 6.1(a), DME shall
promptly liquidate the Assets, except that if DME is unable to perform this
function, a liquidator elected by Participants whose Percentages represent more
than fifty percent (50%) of the aggregate Percentages of all Participants shall
liquidate the Assets.
(b)    Net profit and net loss attributable to a Capital Account during the
Fiscal Periods that include the period of liquidation shall be allocated
pursuant to Article III. The proceeds from liquidation shall be divided in the
following manner, subject to applicable law:
(i)
the debts, liabilities and obligations of the venture, other than debts to the
Participants as Participants, and the expenses of liquidation (including legal
and accounting expenses incurred in connection therewith), up to and including
the date that distribution of the Assets to the Participants has been completed,
shall be first satisfied (whether by payment or the making of reasonable
provision for payment thereof);

(ii)
such debts as are owing to the Participants as Participants shall be next paid;
and

(iii)
the Participants shall be next paid liquidating distributions (in cash,
securities, or other assets, whether or not readily marketable) pro rata in
accordance with, and up to the positive balances of their respective Capital
Accounts, as adjusted pursuant to Article III to reflect allocations for the
Fiscal Period ending on the date of the distributions under this
Section 6.2(b)(iii).

(c)    Notwithstanding anything in this Section 6.2 to the contrary and subject
to the priorities set forth in applicable law, DME, the liquidator or the
trustee, as the case may be, may distribute ratably in-kind rather than in cash,
upon termination, any Assets, provided, however, that if any in-kind
distribution is to be made, (i) the assets distributed in kind must be valued
pursuant to Section 7.2 as of the actual date of their distribution, and charged
as so valued and distributed against amounts to be paid under Section 6.2(b)
above and (ii) any gain or loss (as computed for book purposes) attributable to
property distributed in-kind must be included in the net profit or net loss
attributable to the Capital Account for the Fiscal Period ending on the date of
such distribution.
_____________
Article VII
Accounting and Valuations;
Books and Records;
Board Meetings
_____________
7.1.    Accounting and Reports

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(a)    DME may adopt, on behalf of the venture, for tax accounting purposes any
accounting method that DME decides in its reasonable discretion is in the best
interests of the venture and that is permissible for U.S. federal income tax
purposes and that does not prejudice any other Participant. DME will promptly
notify each Participant in writing of any change.
(b)    At the request of a Participant received at least 30 days prior to the
end of the Fiscal Year, as soon as practicable after the end of such Fiscal
Year, DME shall cause an audit of the financial statements of the venture in
accordance with U.S. generally accepted accounting principles as of the end of
each such Fiscal Year to be made by a firm of certified public accountants
selected by DME, which is reasonably acceptable to Greenlight Re and GRIL; and
as soon as is practicable thereafter but subject to Section 7.5, a copy of a set
of financial statements prepared on a basis that uses United States generally
accepted accounting principles as a guideline (with such adjustments thereto as
the Participants determine appropriate), including the report of such certified
public accountants, is furnished to each Participant. For purposes of this
Section 7.1(b) the accounting firm of Ernst & Young, LLP shall be deemed
acceptable to Greenlight Re and GRIL.
(c)    Promptly after each calendar month end, DME shall arrange for the
preparation and delivery to each Participant of an interim statement of its
respective Capital Account valued as set forth in Section 7.2, including, but
not limited to, balance sheet, income statement, trial balance and detailed
holdings report of a Participant’s Capital Account, and other information that
the Participant may reasonably request.
(d)    As soon as practicable after the end of each taxable year, DME shall
furnish each Participant such information as may be required to enable each
Participant properly to report for United States federal, state and local income
tax purposes, as applicable, its distributive share of each Participant’s item
of income, gain, loss, deduction or credit for such year.
(e)    DME shall arrange for the preparation and delivery to each Participant a
statement setting forth the computation of (i) the Management Fee within 10
Business Days following the beginning of each month and (ii) Performance
Allocation within 30 days after the close of each Performance Period.
(f)    DME shall provide a draft of any tax return required to be filed by the
venture (together with schedules, statement or attachments thereto) to
Greenlight Re and GRIL no later than ten (10) Business Days prior to the due
date (including extensions) of such tax return for their review and comment. DME
shall consult with Greenlight Re and GRIL and in good faith consider any
comments provided by Greenlight Re and GRIL within five (5) Business Days of
their receipt of such tax returns.
(g)    DME shall, or shall cause DMELP to, timely prepare and file on behalf of
Greenlight Re, GRIL or the venture any filings under Section 13 or 16 of the
Exchange Act with the U.S. Securities and Exchange Commission resulting from any
investment made by the venture.
(h)    DME will, and will cause DMELP to, use commercially reasonable efforts to
assist Greenlight Re and GRIL in any required internal control or compliance
matters applicable to Greenlight Re and GRIL and related to this Agreement,
including preparing any internal control

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reviews that are reasonably deemed necessary by Greenlight Re and GRIL. DME
acknowledges that (i) Greenlight Re is subject to the reporting requirements of,
among others, the Securities Exchange Act of 1934, as amended, the listing
requirements of the Nasdaq Stock Market and the regulatory and information
requirements of the Cayman Islands Monetary Authority and A.M Best & Co., and
(ii) GRIL is subject to the regulatory and information requirements of the
Insurance Supervision Department of the Irish Financial Regulator and A.M. Best
& Co. Furthermore, DME will use commercially reasonable efforts to give access
to the venture’s books and records related to GRIL in case requested by the
Insurance Supervision Department of the Irish Financial Regulator.
(i)    Notwithstanding anything herein to the contrary, all expenses incurred
directly in connection with the creation and maintenance of the accounting
records for the venture shall be paid for or reimbursed by DME.
7.2.    Valuation of Assets and Interests
(a)    DME shall value or have valued the Securities and other Assets as of the
close of business on the last day of each month, at the end of each Performance
Period and on any other date selected by DME or reasonably selected by
Greenlight Re or GRIL, as the case may be. In addition, in good faith, DME shall
value Securities that are being distributed in kind as of their date of
distribution in accordance with Section 6.2(c). In determining the value of the
Assets, no value is placed on the goodwill, if any, created by this Agreement,
or the office records, files, statistical data or any similar intangible assets
relating to the Assets not normally reflected in the venture’s accounting
records, but there must be taken into consideration any related items of income
earned but not received, expenses incurred but not yet paid, liabilities fixed
or contingent, prepaid expenses to the extent not otherwise reflected in the
books of account, and the value of options or commitments to purchase or sell
Securities pursuant to agreements entered into on or prior to such valuation
date. Valuation of Securities made pursuant to this Section 7.2 must be based on
all relevant factors and is expected to comply generally with the following
guidelines:
(i)
The market value of each Security listed or traded on any recognized national
securities exchange shall be the last reported sale price at the relevant
valuation date on the composite tape or on the principal exchange on which such
Security is traded. If no such sale of such Security was reported on that date,
the market value is the last reported bid price (in the case of Securities held
long), or last reported ask price (in the case of Securities sold short).

(ii)
Dividends declared but not yet received, and rights in respect of Securities
that are quoted ex-dividend or ex-rights, shall be recorded at the fair value
thereof, as determined by DME, which may (but need not) be the value so
determined on the day such Securities are first quoted ex-dividend or ex-rights.

(iii)
Listed options, or over-the-counter options for which representative brokers’
quotations shall be available, are valued in the same manner as listed or
over-the-counter Securities as hereinabove provided.

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(b)    The fair value of any assets not referred to in paragraph (a) (or the
valuation of any assets referred to therein in the event that DME determines in
its reasonable discretion that market prices or quotations do not fairly
represent the value of particular assets) shall be determined by or at the
direction of DME; but may be audited by Greenlight Re, GRIL or any of their
representatives or agents, at Greenlight Re’s or GRIL’s cost and expense, as
applicable, at any time upon reasonable notice. In these circumstances, DME will
attempt to use consistent and fair valuation criteria and may (but is not
required to) obtain independent appraisals, which shall be considered an expense
under Section 4.2.
(c)    Except as otherwise reasonably determined by DME, investment and trading
transactions shall be accounted for on the trade date. Accounts shall be
maintained in U.S. dollars and except as otherwise determined by or at the
direction DME: (i) assets and liabilities denominated in currencies other than
U.S. dollars shall be translated at the rates of exchange in effect at the close
of the relevant valuation period (and exchange adjustments shall be recorded in
the results of operations); and (ii) investment and trading transactions and
income and expenses shall be translated at the rates of exchange in effect at
the time of each transaction.
(d)    The value of each Security and other Asset and the net worth of the
Capital Accounts as a whole determined pursuant to this Section 7.2 shall be, in
the absence of bad faith or manifest error and/or subject to any audit
verification, conclusive and binding on all of the Participants and all parties
claiming through or under them.
7.3.    Determinations by DME
(a)    All matters concerning the determination and allocation among the
Participants of the amounts to be determined and allocated pursuant to Sections 
3.4 through 3.9 hereof, including any taxes thereon and accounting procedures
applicable thereto, are and will be determined by DME in good faith unless
specifically and expressly otherwise provided for by the provisions of this
Agreement, and such determinations and allocations are final and binding on all
the Participants.
(b)    DME may make such adjustments to the computation of any of the memorandum
accounts maintained pursuant to this Agreement or any component items comprising
any of the foregoing as it considers reasonably appropriate to reflect the
financial results of the Assets and the intended allocation thereof among the
Participants in a reasonably accurate, fair and efficient manner.
7.4.    Books and Records
(a)    DME shall maintain (or arrange for the maintenance) and keep (or cause to
be kept) books and records of the venture showing all assets and liabilities,
receipts and disbursements, gains and losses, Participants’ Capital Accounts and
all transactions entered into in connection with the Assets and this Agreement.
Such books and records shall be kept at DME’s office.
(b)    DME shall retain, or arrange for the retention, for a period of at least
five (5) years, copies of any documents it deems pertinent generated or received
by DME in the ordinary course of business pertaining to the Assets or to the
compensation payable to DME. DME shall afford to Greenlight Re’s or GRIL’s
independent auditors reasonable access to such documents during

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customary business hours and shall permit Greenlight Re’s and/or GRIL’s auditors
to make copies thereof or extracts therefrom at the expense of Greenlight Re or
GRIL, as the case may be.
7.5.    Greenlight Re or GRIL Board Meeting
At the request of Greenlight Re or GRIL, as applicable, and subject to
reasonable prior notice, DME shall endeavor to make one of DME’s or DMELP’s
representatives available to attend the meetings of such party’s Board, or
meetings with such party’s management (in either case in person or
telephonically) to report on the ventures’ activities and on other matters
pertaining to this Agreement.
_____________
Article VIII
General Provisions
_____________
8.1.    Amendment of Agreement
This Agreement may be amended, in whole or in part, with the written consent of
all of the Participants.
8.2.    Notices
Unless otherwise provided, all notices and other communications required or
permitted under this Agreement shall be in writing and shall be sent by
facsimile, sent by electronic mail, or delivered personally by hand or by an
internationally recognized overnight courier addressed to the party to be
notified at the address, facsimile number or e-mail address indicated for such
party set forth below, or at such other address, facsimile number or e-mail
address as such party may designate by ten days advance written notice to the
other parties hereto. All such notices shall be effective upon receipt. Unless
otherwise provided in writing to the other parties, all notices shall be sent to
the following addresses, facsimile numbers or e-mail addresses:

If to DME:
DME Advisors, LLC
140 East 45th Street, 24th Floor
New York, NY 10017
Attention: Daniel Roitman
Facsimile No.: 212-973-9219
E-Mail: droitman@greenlightcapital.com

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With a copy to (which shall not constitute notice):
DME Advisors, LLC
140 East 45th Street, 24th Floor
New York, NY 10017
Attention: Harry Brandler
Facsimile No.: 212-973-9219
E-Mail: HBrandler@greenlightcapital.com
If to Greenlight Re or to Greenlight Capital Re:
Greenlight Reinsurance, Ltd.
65 Market Street, Suite 1207
Camana Bay
P.O. Box 31110
Grand Cayman, KY 1-1205
Cayman Islands
Attention: Tim Courtis
Facsimile No.: 345-745-4576
E-Mail: Tim@greenlightre.ky

With a copy to (which shall not constitute notice):
Akin Gump Strauss Hauer & Feld LLP
One Bryant Park
New York, New York 10036
Attention: Kerry E. Berchem, Esq.
Facsimile No.: 212-872-1002
E-Mail: kberchem@akingump.com
If to GRIL:
Greenlight Reinsurance Ireland, Ltd.
Ground Floor, La Touche House
IFSC
Dublin 1, Ireland
Attention: Eamon Brady
Email: Eamon@greenlightre.ie

With a copy to (which shall not constitute notice):
Greenlight Reinsurance Ireland, Ltd.
c/o 65 Market Street, Suite 1207
Camana Bay
P.O. Box 31110
Grand Cayman, KY 1-1205
Cayman Islands
Attention: Tim Courtis

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Facsimile: 345-745-4576
Email: Tim@greenlightre.ky

8.3.    Agreement Binding Upon Successors and Assigns
This Agreement shall be binding upon and inures to the benefit of the parties
hereto and their respective successors and permitted assigns as set forth in
Section 5.3 hereof.
8.4.    Governing Law
(a)    This Agreement and the rights of the Participants hereunder shall be
governed by and construed in accordance with the laws of the State of New York,
without regard to the conflict of laws rules thereof. The parties acknowledge
that the venture is formed under the laws of the State of New York.
(b)    Each party hereto submits to the jurisdiction of any state or federal
court sitting in New York, New York in any action arising out of or relating to
this Agreement and agrees that all claims in respect of any such action may be
heard and determined in any such court. Each party hereto agrees that a final
judgment in any action so brought will be conclusive and may be enforced by
action on the judgment or in any other manner provided at law or in equity. Each
party hereto waives any defense of inconvenient forum to the maintenance of any
action so brought and waives any bond, surety, or other security that might be
required of any other party with respect thereto.
8.5.    Not for Benefit of Third Parties
The provisions of this Agreement are intended only for the regulation of
relations among Participants and between Participants and former or prospective
Participants. This Agreement is not intended for the benefit of non-Participants
and no rights are granted to non-Participants under this Agreement.
8.6.    Consents
Any and all consents, agreements or approvals provided for or permitted by this
Agreement must be in writing and a signed copy thereof must be filed and kept
with the books of each Participant.
8.7.    Miscellaneous
(a)    The captions and titles preceding the text of each section hereof shall
be disregarded in the construction of this Agreement.
(b)    This Agreement may be executed in counterparts, each of which is deemed
to be an original hereof.
(c)    The Participants have participated jointly in the negotiation and
drafting of this Agreement. In the event an ambiguity or question of intent or
interpretation arises, the Participants intend that this Agreement be construed
as if drafted jointly by the Participants and that no presumption or burden of
proof arise favoring or disfavoring any Participant by virtue of the

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authorship of any of the provisions of this Agreement. Any reference to any
federal, state, local, or foreign statute or law is deemed also to refer to all
rules and regulations promulgated thereunder, unless the context requires
otherwise. The word “including” means including without limitation. The word
“or” is not exclusive. All words used in this Agreement shall be construed to be
of such gender or number as the circumstances require.
(d)    The Participants intend that each representation, warranty, and covenant
contained herein has independent significance. If any Participant has breached
any representation, warranty, or covenant contained herein in any respect, the
fact that there exists another representation, warranty, or covenant relating to
the same subject matter (regardless of the relative levels of specificity) that
such Participant has not breached does not detract from or mitigate the fact
that such Participant is in breach of the first representation, warranty, or
covenant.
(e)    If any provision of this Agreement is held invalid or unenforceable by
any court of competent jurisdiction, the other provisions of this Agreement
shall remain in full force and effect. Any provision of this Agreement held
invalid or unenforceable only in part or degree shall remain in full force and
effect to the extent not held invalid or unenforceable.
(f)    Each party hereto hereby agrees that the other would be damaged
irreparably if any provision of this Agreement were not performed in accordance
with the specific terms or were otherwise breached and each party hereto agrees
that any party shall be entitled to seek equitable relief, including, without
limitation, any injunction or injunctions, to prevent breaches or threatened
breaches of this Agreement by the other parties or any of their representatives
and to specifically enforce the terms and provisions of this Agreement.
8.8.    Entire Agreement
This Agreement contains the entire understanding of the parties hereto with
respect to the subject matter hereof and supersedes all prior agreements and
understandings between the parties hereto relating to the subject matter hereof,
and each of the parties hereto agrees that each and every such prior agreement
is terminated and replaced in its entirety by the rights created by this
Agreement.
[SIGNATURE PAGE FOLLOWS]

32

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first-above written.
GREENLIGHT REINSURANCE, LTD.
By: /s/ Barton Hedges
 
By: /s/ Tim Courtis
Name: Barton Hedges
 
Name: Tim Courtis
Title: CEO
 
Title: CFO

GREENLIGHT REINSURANCE IRELAND, LTD.
By: /s/ Barton Hedges
 
By: /s/ Tim Courtis
Name: Barton Hedges
 
Name: Tim Courtis
Title: CEO
 
Title: CFO

DME ADVISORS, LLC
By: /s/ Harry Brandler
 
By: /s/ Daniel Roitman
Name: Harry Brandler
 
Name: Daniel Roitman
Title: CFO
 
Title: COO

GREENLIGHT CAPITAL RE, LTD.
solely for the purpose of Section 4.1 (b) and (c)
By: /s/ Barton Hedges
 
By: /s/ Tim Courtis
Name: Barton Hedges
 
Name: Tim Courtis
Title: CEO
 
Title: CFO

[Signature Page – JV Agreement]

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Exhibit A-1
GREENLIGHT RE GUIDELINES
•
Composition of Investments: At least 80% of the assets in the investment
portfolio will be held in debt or equity securities (including swaps) of
publicly traded companies (or their subsidiaries) and governments of the
Organization of Economic Co-operation and Development (the “OECD”), high income
countries, cash, cash equivalents and gold. No more than 10% of the assets in
the investment portfolio will be held in private equity securities.

•
Concentration of Investments: Other than cash, cash equivalents and United
States government obligations and gold, no single investment in the investment
portfolio will constitute more than 20% of the portfolio.

•
Liquidity: Assets will be invested in such fashion that Greenlight Re has a
reasonable expectation that it can meet any of its liabilities as they become
due. Greenlight Re will review with the investment advisor the liquidity of the
portfolio on a periodic basis.

•
Monitoring: Greenlight Re will require the investment advisor to re-evaluate
each position in the investment portfolio and to monitor changes in intrinsic
value and trading value and provide monthly reports on the investment portfolio
to Greenlight Re as Greenlight Re may reasonably determine.

•
Leverage: The investment portfolio may not employ greater than 15% indebtedness
for borrowed money, including net margin balances, for extended time periods.
The investment advisor may employ, in the normal course of business, up to 30%
indebtedness for periods of less than 30 days.

A-1

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Exhibit A-2
GRIL GUIDELINES
•
Composition of Investments: At least 80% of the assets in the investment
portfolio will be held in debt or equity securities (including swaps) of
publicly traded companies (or their subsidiaries) and governments of OECD (the
Organization of Economic Co-operation and Development) high income countries,
cash, cash equivalents and gold. No more than 10% of the assets in the
investment portfolio will be held in private equity securities.

•
Concentration of Investments: Other than cash or cash equivalents and United
States government obligations, (1) no single investment in the investment
portfolio will constitute more than 10% of the portfolio, (2) the 10 largest
investments shall not constitute greater than 50% of the total investment
portfolio, and (3) the investment portfolio shall at all times be comprised of a
minimum of 50 debt or equity securities of publicly traded companies (or their
subsidiaries).

•
Liquidity: Assets will be invested in such fashion that GRIL has a reasonable
expectation that it can meet any of its liabilities as they become due. GRIL
will review with the investment advisor the liquidity of the portfolio on a
periodic basis.

•
Monitoring: GRIL will require the investment advisor to re-evaluate each
position in the investment portfolio and to monitor changes in intrinsic value
and trading value and provide monthly reports on the investment portfolio to
GRIL as GRIL may reasonably determine.

•
Leverage: The investment portfolio may not employ greater than 5% indebtedness
for borrowed money, including net margin balances, for extended time periods.
The investment advisor may use, in the normal course of business, an aggregate
of up to 20% net margin leverage for periods of less than 30 days.

A-2