Exhibit 10.1

 

 

THIRD AMENDED AND RESTATED FUNDS AT LLOYD’S
LETTER OF CREDIT AGREEMENT

AMONG

THE NAVIGATORS GROUP, INC.,

as Borrower,

THE LENDERS NAMED HEREIN,

and

ING BANK N.V., LONDON BRANCH,

as Administrative Agent and Letter of Credit Agent

DATED AS OF

NOVEMBER 7, 2016

ING BANK, N.V., LONDON BRANCH,

as Lead Arranger and Sole Bookrunner

 

 

 

 

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TABLE OF CONTENTS

 

Page

ARTICLE I

DEFINITIONS

1

ARTICLE II

THE LETTER OF CREDIT FACILITY

22

2.1

Issuance of Letters of Credit

22

2.2

Conversion Principles

24

2.3

Reductions in Commitments

24

2.4

Reimbursement Obligations

24

2.5

Procedure for Issuance

26

2.6

Nature of the Agent and Lenders’ Obligations

27

2.7

Notification of Issuance Requests

28

2.8

Fees, Interest and Payments Generally

29

2.9

Collateralization Events

31

2.10

Collateral Account

32

ARTICLE III

YIELD PROTECTION; TAXES

33

3.1

Yield Protection

33

3.2

Changes in Capital Adequacy Regulations

34

3.3

Taxes

35

3.4

Lender Statements; Survival of Indemnity

38

ARTICLE IV

CONDITIONS PRECEDENT

39

4.1

The Lenders Obligation to Issue

39

4.2

Each Letter of Credit

41

ARTICLE V

REPRESENTATIONS AND WARRANTIES

41

5.1

Existence and Standing

41

5.2

Authorization and Validity

42

5.3

No Conflict; Government Consent

42

5.4

Financial Statements

42

5.5

Statutory Financial Statements

43

5.6

Material Adverse Change

43

5.7

Taxes

43

5.8

Litigation and Contingent Obligations

43

5.9

Subsidiaries

43

5.10

ERISA

44

5.11

Defaults

44

5.12

Accuracy of Information

44

5.13

Regulation U

44

 

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TABLE OF CONTENTS

(continued)

Page

5.14

Material Agreements

44

5.15

Compliance With Laws

44

5.16

Ownership of Properties

45

5.17

Plan Assets; Prohibited Transactions

45

5.18

Environmental Matters

45

5.19

Investment Company Act

45

5.20

Solvency

45

5.21

Insurance Licenses

46

5.22

Partnerships

46

5.23

Lines of Business

46

5.24

Reinsurance Practices

46

5.25

Security

46

5.26

Disclosure

46

5.27

Anti-Money Laundering and Anti-Terrorism Finance Laws

47

5.28

Anti-Corruption Laws

47

5.29

Sanctions Laws

47

ARTICLE VI

COVENANTS

48

6.1

Financial Reporting

48

6.2

Purpose

52

6.3

Notice of Material Events

52

6.4

Conduct of Business

52

6.5

Taxes

53

6.6

Insurance

53

6.7

Compliance with Laws

53

6.8

Maintenance of Properties

53

6.9

Inspection; Maintenance of Books and Records

53

6.10

Dividends and Stock Repurchases

54

6.11

Indebtedness

54

6.12

Merger

54

6.13

Sale of Assets

54

6.14

Investments and Acquisitions

55

6.15

Contingent Obligations

56

6.16

Liens

56

6.17

Affiliates

57

 

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TABLE OF CONTENTS

(continued)

Page

6.18

Amendments to Agreements

57

6.19

Change in Fiscal Year

57

6.20

Inconsistent Agreements

57

6.21

Reinsurance

58

6.22

Stock of Subsidiaries

58

6.23

Financial Covenants

58

6.24

Additional Pledge

59

6.25

Primary FAL

59

6.26

Syndicate Business Forecasts

59

6.27

Anti-Money Laundering and Anti-Terrorism Finance Laws; Foreign Corrupt Practices
Act; Sanctions Laws; Restricted Person

59

ARTICLE VII

DEFAULTS

60

ARTICLE VIII

ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES

62

8.1

Acceleration

62

8.2

Amendments

63

8.3

Preservation of Rights

64

8.4

Application of Funds

64

ARTICLE IX

GENERAL PROVISIONS

65

9.1

Survival of Representations

65

9.2

Governmental Regulation

65

9.3

Headings

65

9.4

Entire Agreement

66

9.5

Numbers of Documents

65

9.6

Several Obligations; Benefits of this Agreement

65

9.7

Expenses; Indemnification

66

9.8

Accounting

66

9.9

Severability of Provisions

66

9.10

Nonliability of Lenders

67

9.11

Confidentiality

67

9.12

Nonreliance

67

9.13

Disclosure

67

9.14

USA Patriot Act Notification

67

 

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TABLE OF CONTENTS

(continued)

Page

ARTICLE X

THE AGENT

68

10.1

Appointment; Nature of Relationship

68

10.2

Powers

68

10.3

General Immunity

68

10.4

No Responsibility for Recitals, etc

69

10.5

Action on Instructions of Lenders

69

10.6

Employment of Administrative Agent and Counsel

69

10.7

Reliance on Documents; Counsel

69

10.8

Administrative Agent’s Reimbursement and Indemnification

70

10.9

Notice of Default

70

10.10

Rights as a Lender

70

10.11

Lender Credit Decision

71

10.12

Successor Administrative Agent

71

10.13

Administrative Agents’ Fees

71

10.14

Delegation to Affiliates

72

10.15

Security Trustee

72

ARTICLE XI

SETOFF; RATABLE PAYMENTS

72

11.1

Setoff

72

11.2

Ratable Payments

72

ARTICLE XII

BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS

73

12.1

Successors and Assigns

73

12.2

Participations

73

12.3

Assignments

74

12.4

Dissemination of Information

75

12.5

Tax Treatment

75

ARTICLE XIII

NOTICES

76

13.1

Notices

76

13.2

Change of Address

76

ARTICLE XIV

COUNTERPARTS

77

 

Acknowledgement and Consent to Bail-In of EEA Financial Institutions

77

 

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TABLE OF CONTENTS

(continued)

Page

ARTICLE XVI

CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL

78

16.1

CHOICE OF LAW

78

16.2

CONSENT TO JURISDICTION

78

16.3

WAIVER OF JURY TRIAL

78

16.4

REAFFIRMATION

79

 

 

SCHEDULES

Schedule 1

Commitments

 

Schedule 1.1

Eligible Collateral

 

Schedule 1.2

Existing Letters of Credit

 

Schedule 5.9

Subsidiaries

 

Schedule 5.22

Partnerships

 

Schedule 5.23

Existing Lines of Business

 

Schedule 6.16

Liens

 

Schedule 6.21

Reinsurance Guidelines

 

 

EXHIBITS

Exhibit A

Compliance Certificate

 

Exhibit B

Assignment Agreement

 

Exhibit C

Letter of Credit Application

 

Exhibit D

Borrowing Base Certificate

 

Exhibit E

Security Agreement

 

Exhibit F

Fixed Charge

 

Exhibit G

Letter of Credit

 

Exhibit H

Lloyd’s Comfort Letter

 

Exhibit I

Confirmation of Primary FAL

 

Exhibit J-1

Deposit Account Control Agreement

 

Exhibit J-2

Securities Account Control Agreement

 

 

 

 

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THIRD AMENDED AND RESTATED FUNDS AT LLOYD’S
LETTER OF CREDIT AGREEMENT

This Third Amended and Restated Funds at Lloyd’s Letter of Credit Agreement,
dated as of November 7, 2016, is among THE NAVIGATORS GROUP, INC., a Delaware
corporation, the Lenders and ING BANK, N.V., London Branch, individually and as
Administrative Agent, Letter of Credit Agent and Lead Arranger and Sole
Bookrunner.

R E C I T A L S:

A.The Borrower, the Lenders, and ING Bank, N.V., London Branch, as
administrative agent, letter of credit agent and lead arranger, entered into
that Second Amended and Restated Funds at Lloyd’s Letter of Credit Agreement,
dated as of November 24, 2014 (as amended and in effect on the date hereof, the
“Existing Credit Agreement).

B.The parties wish to amend and restate the Existing Credit Agreement in its
entirety for the purpose of issuing Letters of Credit to provide Funds at
Lloyd’s to support underwriting capacity provided by the Corporate Member to the
Supported Syndicate for the 2017 and 2018 underwriting years of account (and
prior open years).

C.The parties hereto intend that this Agreement and any Facility Documents
executed in connection herewith not effect a novation of the obligations of the
Borrower under the Existing Credit Agreement but merely a restatement, and where
applicable, an amendment to the terms governing said obligations.

NOW, THEREFORE, in consideration of the mutual covenants and undertakings herein
contained and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Borrower, the Lenders and the
Administrative Agent hereby agree as follows:

ARTICLE I

DEFINITIONS

As used in this Agreement:

“Account Bank” means (i) with respect to funds in the United Kingdom, ING Bank,
N.V., London Branch and (b) with respect to funds in the United States, any
“bank” within the meaning of Section 9-102(a)(8) of the UCC at which any deposit
account constituting a Collateral Account is held, which shall be reasonably
acceptable to the Administrative Agent.

“Acquisition” means any transaction, or any series of related transactions,
consummated on or after the date of this Agreement, by which the Borrower or any
of its Subsidiaries (a) acquires any on-going business or all or substantially
all of the assets of any firm, corporation or limited liability company, or
division thereof, whether through purchase of assets, merger, amalgamation or
otherwise or (b) directly or indirectly acquires (in one transaction or as the
most recent transaction in a series of transactions) at least a majority (in
number of votes) of the securities of a corporation which have ordinary voting
power for the election of directors (other

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than securities having such power only by reason of the happening of a
contingency) or a majority (by percentage or voting power) of the outstanding
ownership interests of a partnership or limited liability company.

“Adjusted Fair Market Value” means with respect to any Cash Equivalent
Investment held in a Collateral Account an amount equal to the product of the
Fair Market Value of such Cash Equivalent Investment and the applicable
percentage with respect to such Cash Equivalent Investment as set forth on
Schedule 1.1.

“Adjusted Primary FAL” means, as of any date, (i) Primary FAL minus (ii) the NFS
Deficiency as of the most recent date such amount has been reported by Lloyd’s
plus (iii) the Solvency Surplus as of the most recent date such amount has been
reported by Lloyd’s.

“Administrative Agent” means ING Bank, N.V. London Branch, in its capacity as
Administrative Agent pursuant to Article X and not in its individual capacity as
a Lender or as Letter of Credit Agent and any successor Administrative Agent
appointed pursuant to Article X.

“Affiliate” of any Person means any other Person directly or indirectly
controlling, controlled by or under common control with such Person.  A Person
shall be deemed to control another Person if the controlling Person owns 10% or
more of any class of voting securities (or other ownership interests) of the
controlled Person or possesses, directly or indirectly, the power to direct or
cause the direction of the management or policies of the controlled Person,
whether through ownership of stock, by contract or otherwise.

“Aggregate Commitment” means the aggregate of the Tranche A Commitments and the
Tranche B Commitments.  A Lender’s Aggregate Commitment means such Lender’s
aggregate Tranche A Commitment and Tranche B Commitment.

“Agreement” means this Amended and Restated Funds at Lloyd’s Letter of Credit
Agreement.

“Agreement Accounting Principles” means generally accepted accounting principles
as in effect from time to time, applied in a manner consistent with those used
in preparing the financial statements referred to in Section 5.4; provided,
however, that (a) for purposes of all computations required to be made with
respect to compliance by the Borrower with Section 6.23, such term shall mean
generally accepted accounting principles as in effect on the Amendment Effective
Date, applied in a manner consistent with those used in preparing the financial
statements referred to in Section 5.4 and (b) for purposes of the financial
statements required under Sections 6.1(f) and (g), such term shall mean the
generally accepted accounting principles as in effect from time to time in the
United Kingdom.

“A.M. Best Rating” means, as to any insurance company, its financial strength
rating assigned by The A.M. Best Company, Inc.

“Amendment Effective Date” means November 7, 2016.

“Annual Statement” means the annual statutory financial statement of any
Insurance Subsidiary required to be filed with the insurance commissioner (or
similar authority) of its

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jurisdiction of incorporation, which statement shall be in the form required by
such Insurance Subsidiary’s jurisdiction of incorporation or, if no specific
form is so required, in the form of financial statements permitted by such
insurance commissioner (or such similar authority) to be used for filing annual
statutory financial statements and shall contain the type of information
permitted by such insurance commissioner (or such similar authority) to be
disclosed therein, together with all exhibits or schedules filed therewith.

“Anti-Corruption Laws” is defined in Section 5.28.

“Anti-Terrorism Laws” is defined in Section 5.27.

“Applicable Letter of Credit Fee Rate” means, at any time, the per annum rate at
which Letter of Credit Fees are accruing on the Letters of Credit at such time
as set forth below:

Applicable Letter of Credit Fee Rate

 

A+ Financial Strength Rating of Navigators

A Financial Strength Rating of Navigators

A- or below

Financial Strength

Rating of Navigators or no Financial Strength Rating

 

Adjusted Primary FAL < 75% of the aggregate stated amount of outstanding Letters
of Credit

 

1.15%

1.35%

1.60%

Adjusted Primary FAL ≥ 75% but < 100% of the aggregate stated amount of
outstanding Letters of Credit

 

1.05%

1.25%

1.50%

Adjusted Primary FAL ≥ 100% of the aggregate stated amount of outstanding
Letters of Credit

 

0.95%

1.15%

1.40%

 

The Adjusted Primary FAL on any date shall be based on the most recently
delivered Compliance Certificate delivered pursuant to Section 6.1(i); provided,
however that if a Compliance Certificate has not been delivered when required
pursuant to Section 6.1(i), the Adjusted Primary FAL shall be deemed to be less
than 75% until such Compliance Certificate has been delivered.  The Financial
Strength Rating on any day shall be based on Navigator’s then-current A.M. Best
Rating and S&P Rating; provided that if the A.M. Best Rating and the S&P Rating
are not the same, the better Rating shall apply except that if the Ratings
differ by more than one level than the level above the lower Rating shall
apply.  The Rating in effect on

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any date for the purposes of this Schedule is that in effect at the close of
business on such date.  If at any time Navigators has only an A.M. Best Rating
or a S&P Rating, the Letter of Credit Fee Rate shall be determined based on the
current A.M. Best Rating or S&P Rating, as the case may be.  

Notwithstanding the foregoing, (i) in the event the Borrower has posted
Collateral (other than Collateral which has been posted pursuant to Section
2.9), the Applicable Letter of Credit Fee Rate shall be (x) with respect to an
amount of the outstanding Letters of Credit supported by Eligible Collateral,
0.50%, and (y) with respect to the remaining amount of outstanding Letters of
Credit, the rate then in effect pursuant to the table above, (ii) in the event
the Borrower has posted Collateral pursuant to Sections 2.9(c), (d), (e) or (f),
the Applicable Letter of Credit Fee Rate shall be (x) with respect to an amount
of the outstanding Letters of Credit supported by Eligible Collateral, 0.70%,
and (y) with respect to the remaining amount of outstanding Letters of Credit,
the rate then in effect pursuant to the table above, and (iii) in the event that
an Event of Default has occurred and is continuing, the Applicable Letter of
Credit Fee shall be the Default Rate.

“Applicable Percentage” means with respect to any Lender at any time, (i) in
connection with the Tranche A Commitment, the percentage (carried out to the
ninth decimal place) of the Tranche A Commitments represented by such Lender’s
Tranche A Commitment at such time, (ii) in connection with the Tranche B
Commitment, the percentage (carried out to the ninth decimal place) of the
Tranche B Commitments represented by such Lender’s Tranche B Commitment at such
time and (iii) in all other cases, the percentage (carried out to the ninth
decimal place) of the Aggregate Commitments represented by such Lender’s Tranche
A Commitment and Tranche B Commitment at such time.  If the Aggregate
Commitments of each Lender to issue Letters of Credit have been terminated
pursuant to Section 8.1 or if the Aggregate Commitments have expired, then the
Applicable Percentage of each Lender shall be determined based on the percentage
such Lender’s Letter of Credit Obligations are of all Letter of Credit
Obligations.  The initial Applicable Percentage of each Lender is set forth
opposite the name of such Lender on Schedule 1 or in the Notice of Assignment
pursuant to which such Lender becomes a party hereto, as applicable.  The
Applicable Percentage “of” a particular amount may also refer to the value
obtained by multiplying the Applicable Percentage times such amount.

“Applicable Unused Fee Rate” means 0.375%.

“Approved Reinsurer” means a reinsurer which satisfies the criteria set forth in
the Reinsurance Guidelines for entering into reinsurance or retrocession
agreements with the Borrower and its Insurance Subsidiaries

“Arranger” means ING Bank N.V., London Branch and its successors.

“Article” means an article of this Agreement unless another document is
specifically referenced.

“Authorized Officer” means any of the president, chief financial officer or
treasurer of the Borrower, acting singly.

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“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by
the applicable EEA Resolution Authority in respect of any liability of an EEA
Financial Institution.

“Bail-In Legislation” means, with respect to any EEA Member Country implementing
Article 55 of Directive 2014/59/EU of the European Parliament and of the Council
of the European Union, the implementing law for such EEA Member Country from
time to time that is described in the EU Bail-In Legislation Schedule.

“Bankruptcy Code” means Title 11, United States Code, sections 1 et seq., as the
same may be amended from time to time and any successor thereto or replacement
therefor which may be hereafter enacted.

“Basel III” means (a)the agreements on capital requirements, a leverage ratio
and liquidity standards contained in "Basel III: A global regulatory framework
for more resilient banks and banking systems", "Basel III: International
framework for liquidity risk measurement, standards and monitoring" and
"Guidance for national authorities operating the countercyclical capital buffer"
published by the Basel Committee on Banking Supervision in December 2010, each
as amended, supplemented or restated;  (b) the rules for global systemically
important banks contained in "Global systemically important banks: assessment
methodology and the additional loss absorbency requirement – Rules text"
published by the Basel Committee on Banking Supervision in November 2011, as
amended, supplemented or restated; and (c) any further guidance or standards
published by the Basel Committee on Banking Supervision relating to "Basel III".

 

“Borrower” means The Navigators Group, Inc., a Delaware corporation and its
successors and assigns.

“Borrowing Base” means on any date of determination, an amount equal to the sum
of the Adjusted Fair Market Value of all Eligible Collateral.

“Borrowing Base Certificate” means a certificate substantially in the form of
Exhibit D with such changes therein as the Administrative Agent may reasonably
request from time to time.

“Business Day” means a day (other than a Saturday or Sunday) on which banks
generally are open in New York and London for the conduct of substantially all
of their commercial lending activities.

“Capitalized Lease” of a Person means any lease of Property by such Person as
lessee which would be capitalized on a balance sheet of such Person prepared in
accordance with Agreement Accounting Principles.

“Capitalized Lease Obligations” of a Person means the amount of the obligations
of such Person under Capitalized Leases which would be shown as a liability on a
balance sheet of such Person prepared in accordance with Agreement Accounting
Principles.

“Cash Equivalent Investments” means (a) short-term obligations of, or fully
guaranteed by, the United States of America, (b) commercial paper rated A-1 or
better by S&P or P1 or

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better by Moody’s, (c) demand deposit accounts maintained in the ordinary course
of business and (d) certificates of deposit issued by and time deposits with
commercial banks (whether domestic or foreign) having capital and surplus in
excess of $500,000,000.

“Change” is defined in Section 3.2.

“Change in Control” means (a) the acquisition by any Person, or two or more
Persons acting in concert of beneficial ownership (within the meaning of Rule
13d‑3 of the Securities and Exchange Commission under the Securities Exchange
Act of 1934) of (i) 20% or more of the outstanding shares of voting stock of the
Borrower or (ii) if less, a percentage of such stock, greater than the
percentage owned by members of the Terence Deeks Family, or (b) the members of
the Terence Deeks Family shall cease to own, in the aggregate, free and clear of
all Liens and other encumbrances, at least 10% of the outstanding shares of
voting stock of the Borrower on a fully diluted basis.

“Code” means the Internal Revenue Code of 1986, as amended or otherwise modified
from time to time, and the Treasury Regulations promulgated thereunder.

“Collateral” means any property or asset in which the Borrower has granted a
security interest to the Administrative Agent or the Security Trustee for the
benefit of the Secured Parties.

“Collateral Account” means each of (a) the UK Collateral Account, (b) account
number 6255582 titled “ Navigators Group – Securities” and account number
6255590 titled
“Navigators Group – Cash”, in each case held at Brown Brothers & Harriman & Co.
and (c) any other “demand deposit account” or “securities account” (as such
terms are defined in the UCC) maintained by the Administrative Agent or any
Financial Intermediary which is subject to a Control Agreement into which
Eligible Collateral is deposited from time to time pursuant to the terms of this
Agreement.  Each Collateral Account and the related Eligible Collateral shall be
subject to documentation satisfactory to the Administrative Agent and the taking
of all steps required to give the Administrative Agent a perfected security
interest in such Collateral Account and the Eligible Collateral therein.  Once
opened a Collateral Account can only be closed with the consent of the
Administrative Agent.

“Collateralization Event” means the occurrence of any of (a) an Event of Default
or (b) any of the events set forth in Sections 2.9(c) through (f).

“Collateral Excess” is defined in Section 2.10(d).

“Collateral Shortfall” is defined in Section 2.10(a).

“Collateral Value” means, on any date, an amount equal to the sum of the
Adjusted Fair Market Value of all Eligible Collateral in all Collateral
Accounts.

“Commitment” means, for each Lender, the amount set forth on Schedule 1 or as
set forth in any Notice of Assignment relating to any assignment that has become
effective pursuant to Section 12.3(b), as such amount may be modified from time
to time pursuant to the terms hereof.

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“Compliance Certificate” means a certificate substantially in the form of
Exhibit A with such changes therein as may be satisfactory to the Administrative
Agent.

“Condemnation” is defined in Section 7.8.

“Confirmation of Primary FAL” means the letter substantially in the form of
Exhibit I

“Consolidated” or “consolidated”, when used in connection with any calculation,
means a calculation to be determined on a consolidated basis for the Borrower
and its Consolidated Subsidiaries in accordance with Agreement Accounting
Principles.

“Consolidated Net Income” means, for any period, the net income (or loss) of the
Borrower and its Consolidated Subsidiaries calculated on a consolidated basis
for such period, all as determined in accordance with Agreement Accounting
Principles.

“Consolidated Net Worth” means, for any period, the sum of the consolidated
stockholders’ equity of the Borrower and its Consolidated Subsidiaries
calculated on a consolidated basis for such period, all as determined in
accordance with Agreement Accounting Principles (excluding the effect of any
unrealized gain or loss reported under Statement of Financial Accounting
Standards No. 115).

“Consolidated Person” means, for the taxable year of reference, each Person
which is a member of the affiliated group of the Borrower if Consolidated
returns are or shall be filed for such affiliated group for federal income tax
purposes or any combined or unitary group of which the Borrower is a member for
state income tax purposes.

“Consolidated Subsidiaries” means all Subsidiaries of the Borrower which should
be included in the Borrower’s consolidated financial statements, all as
determined in accordance with Agreement Accounting Principles.

“Consolidated Tangible Net Worth means Consolidated Net Worth minus Consolidated
Total Intangible Assets.

“Consolidated Total Assets” means, at any time, the total assets of the Borrower
and its Consolidated Subsidiaries calculated on a consolidated basis as of such
time, all as determined in accordance with Agreement Accounting Principles.

“Consolidated Total Intangible Assets” means, at any time, the total intangible
assets of the Borrower and its Consolidated Subsidiaries calculated on a
consolidated basis as of such time including, but not limited to, goodwill,
patents, trademarks, tradenames, copyrights and franchises and excluding
deferred policy acquisition costs.

“Contingent Obligation” of a Person means any agreement, undertaking or
arrangement by which such Person assumes, guarantees, endorses, contingently
agrees to purchase or provide funds for the payment of, or otherwise becomes or
is contingently liable upon, the obligation or liability of any other Person, or
agrees to maintain the net worth or working capital or other financial condition
of any other Person, or otherwise assures any creditor of such other Person
against loss, including, without limitation, any comfort letter, operating
agreement, take‑or‑pay

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contract or the obligations of any such Person as general partner of a
partnership with respect to the liabilities of the partnership.  The term
“Contingent Obligation” shall not include (a) the obligations of any Insurance
Subsidiary arising under any insurance policy or reinsurance agreement entered
into in the ordinary course of business or (b) operating leases.

“Control Agreement” means (a) the Deposit Account Control Agreement dated as of
March 28, 2011 among the Administrative Agent, the Borrower and Brown Brothers
Harriman & Co. attached hereto as Exhibit J-1, (b) the Securities Account
Control Agreement dated as of March 28, 2011 among the Administrative Agent, the
Borrower and Brown Brothers Harriman & Co. attached hereto as Exhibit J-2, and
(c)  any other agreement (in form and substance acceptable to the Administrative
Agent) among the Borrower, the applicable Financial Institution and the
Administrative Agent with respect to any “deposit account” or “securities
account” (as such terms are defined in the UCC) of the Borrower pursuant to
which the Administrative Agent has “control” (as such term is defined in the
UCC).

“Controlled Group” means all members of a controlled group of corporations or
other business entities and all trades or businesses (whether or not
incorporated) under common control which, together with the Borrower or any of
its Subsidiaries, are treated as a single employer under Section 414 of the
Code.

“Conversion Differential” is defined in Section 2.9(b).

“Conversion Rate” means the spot rate of exchange between Dollars and Pounds as
determined by the Administrative Agent on the Reuters WRLD Page as of the time
of determination on such date.  In the event that such rate does not appear on
any Reuters WRLD Page, the exchange rate shall be determined by reference to
such other publicly available service for displaying exchange rates as may be
agreed upon by the Administrative Agent and the Borrower, or, in the absence of
such an agreement, such exchange rate shall instead be the arithmetic average of
the spot rates of exchange of the Administrative Agent in London at or about
such time between Dollars and Pounds for delivery two Business Days later;
provided that if at the time of any such determination, for any reason, no such
spot rate is being quoted, the Administrative Agent may use any reasonable
method it deems appropriate to determine such rate and such determination shall
be presumed correct absent manifest error.

“Corporate Member” means Navigators Corporate Underwriters Limited, which entity
is a corporate name with limited liability at Lloyd’s of London and a
Wholly-Owned Subsidiary of the Borrower.

“CRD IV” means Directive 2013/36/EU of the European Parliament and of the
Council of 26 June 2013 on access to the activity of credit institutions and the
prudential supervision of credit institutions and investment firms, amending
Directive 2002/87/EC and repealing Directives 2006/48/EC and 2006/49/EC.

“CRR” means Regulation (EU) No 575/2013 of the European Parliament and of the
Council of 26 June 2013 on prudential requirements for credit institutions and
investment firms.

“Default” means an event described in Article VII.

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“Default Rate” means as of any day (a) with respect to fees payable under
Section 2.8, an amount equal to the Applicable Letter of Credit Rate or the
Applicable Unused Fee Rate, as the case may be, plus 2% and (b) with respect to
Reimbursement Obligations and all other Obligations, an amount equal to the
Eurocurrency Rate plus 2%.

“Defaulting Lender” means any Lender that (i) has not funded such Lender’s
Applicable Percentage of the amount of any draw under a Letter of Credit within
three (3) Business Days after the date due therefor in accordance with Section
2.4(b), (ii) has notified the Borrower or the Administrative Agent, or has made
a public statement to the effect, that it does not intend to comply with (x) its
obligations under Section 2.1 (unless such notice or public statement indicates
that such position is based on such Lender’s good faith determination that a
condition precedent (specifically identified and including the particular
default, if any) to issue a Letter of Credit under this Agreement cannot be
satisfied) or its obligations under Section 2.4(b) or generally under other
agreements in which it commits to extend credit,  (iii) becomes the subject of a
Bail-In Action or (iv) is the subject of a bankruptcy, insolvency or similar
receivership proceeding;  provided that a Lender shall not be a Defaulting
Lender solely by virtue of the ownership or acquisition of any equity interest
in that Lender or any direct or indirect parent company thereof by a
Governmental Authority or  in the case of a solvent Lender, the precautionary
appointment of an administrator, guardian, custodian or other similar official
by a Government Authority under or based on the law of the country where such
Lender is subject to home jurisdiction supervision if applicable law requires
that such appointment not be publicly disclosed, in any such case where such
action does not result in or provide such Lender with immunity from the
jurisdiction of courts within the United States or from the enforcement of
judgments or writs of attachment on its assets or permit such Lender (or such
Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts
or agreements made with such Lender.

“Defeased Indebtedness” means Indebtedness which has been defeased or for which
an amount has been deposited in a sinking fund, a redemption fund or an escrow
account for the sole purpose of repaying such Indebtedness on or before the due
date thereof.

“Department” is defined in Section 5.5.

“Dollars” and the sign “$” mean lawful money of the United States of America.

“Drawing Request” is defined in Section 2.4(a).

“EEA Financial Institution” means (a) any credit institution or investment firm
established in any EEA Member Country which is subject to the supervision of an
EEA Resolution Authority, (b) any entity established in an EEA Member Country
which is a parent of an institution described in clause (a) of this definition,
or (c) any financial institution established in an EEA Member Country which is a
subsidiary of an institution described in clause (a) or (b) of this definition
and is subject to consolidated supervision with its parent.

“EEA Member Country” means any of the member states of the European Union from
time to time, Iceland, Liechtenstein, Norway and any other country that the
Lenders (acting reasonably) consider to be an EEA Member Country.

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“EEA Resolution Authority” means any public administrative authority or any
Person entrusted with public administrative authority of any EEA Member Country
(including any delegee) having responsibility for the resolution of any EEA
Financial Institution.

“Eligible Collateral” means (a) obligations of, or fully guaranteed by, the
United States of America and UK Gilts, (b) commercial paper rated A-1 or better
by S&P or P1 or better by Moody’s, (c) cash and (d) certificates of deposit
issued by and time deposits with commercial banks organized in a country which
is a member of the Organization of Economic Co-operation and Development which
(i) are rated of AA- or better from S&P or Aa3 or better from Moody’s and (ii)
have a maturity of not more than two years; provided that all Eligible
Collateral must be  denominated in Dollars or Pounds.  

“Environmental Laws” means any and all federal, state, local and foreign
statutes, laws, judicial decisions, regulations, ordinances, rules, judgments,
orders, decrees, plans, injunctions, permits, concessions, grants, franchises,
licenses, agreements and other governmental restrictions relating to (a) the
protection of the environment, (b) the effect of the environment on human
health, (c) emissions, discharges or releases of pollutants, contaminants,
hazardous substances or wastes into surface water, ground water or land or (d)
the manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of pollutants, contaminants, hazardous substances or
wastes or the clean-up or other remediation thereof.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time and any rule or regulation issued thereunder.  

“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule
published by the Loan Market Association (or any successor person), as in effect
from time to time.

“Eurocurrency Rate” means the London interbank offered rate administered by ICE
Benchmark Administration Limited (or any other Person which takes over the
administration of that rate) for the relevant currency  having a maturity of a
one month period, on pages LIBOR01 or LIBOR02 of the Thomson Reuters screen (or
any replacement Thomson Reuters page which displays that rate) or, in each case,
on the appropriate page of such other information service which publishes that
rate from time to time in place of Thomson Reuters at 11:00 A.M. (London time)
two Business Days prior to the first day of such applicable period. If such page
or service ceases to be available, the Administrative Agent may specify another
page or service displaying the relevant rate or another method of determination
after consultation with the Borrower and (ii) in either case if the Eurocurrency
Rate shall be less than zero, such rate shall be deemed to be zero for purposes
of this Agreement.

“Excluded Taxes” means, in the case of each Lender or applicable Lending
Installation, the Administrative Agent or any other recipient of any payment to
be made by or on account of any obligation of the Borrower hereunder, (a)
income, franchise or similar taxes imposed on (or measured by) its overall net
income by (i) the United States of America, or (ii) the jurisdiction (or any
political subdivision thereof) under the laws of which such Lender or the
Administrative Agent or other recipient is incorporated or organized, or (iii)
the jurisdiction (or any political subdivision thereof) in which the
Administrative Agent’s or such Lender’s or such other recipient's principal
executive office or, in the case of any Lender, in which such Lender’s

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applicable Lending Installation, is located, or, in the case of a jurisdiction
(or any political subdivision thereof) that imposes taxes on the basis of
management or control or other concept or principle of residence, the
jurisdiction (or any political subdivision thereof) in which such Lender or the
Administrative Agent or other recipient is so resident, (b) taxes imposed by
reason of any present or former connection between such recipient and the
jurisdiction (or any political subdivision thereof) imposing such taxes, other
than solely as a result of the execution and delivery of this Agreement or the
performance of any action provided for hereunder, (c) any branch profits taxes
imposed by the United States of America, (d) any backup withholding tax imposed
by the United States of America or any similar taxes imposed by any other
jurisdiction (other than backup withholding tax imposed on the Administrative
Agent in such capacity), (e) in the case of a Non-U.S. Lender, any U.S. Federal
withholding taxes (i) resulting from any law in effect on the date such Non-U.S.
Lender becomes a party to this Agreement (or designates a new Lending
Installation), except to the extent that such Non-U.S. Lender was entitled, at
the time of designation of a new Lending Installation, to receive additional
amounts from the Borrower with respect to such withholding tax pursuant to
Section 3.3(a), or (ii) attributable to such Non-U.S. Lender's failure to comply
with Section 3.3(e) (including as a result of any inaccurate or incomplete
documentation), and (f) any taxes imposed on any “withholdable payment” payable
to a Non-U.S. Lender as a result of its failure to comply with the applicable
requirements of FATCA.  

“Exhibit” refers to an exhibit to this Agreement, unless another document is
specifically referenced.

“Existing Credit Agreement” has the meaning assigned thereto in the recitals.

“Existing Letters of Credit” means the Letters of Credit outstanding under the
Existing Credit Agreement on the Closing Date as shown on Schedule 1.2 which
Existing Letters of Credit shall be a Tranche A Letter of Credit or Tranche B
Letter of Credit as indicated on such Schedule.

“Existing Lines of Business” is defined in Section 5.23.

“Expiry Notice” means written notice from the Letter of Credit Agent to the
beneficiary of any Letter of Credit stating that such Letter of Credit shall
expire four (4) years from the date of such notice.

“Facility Documents” means this Agreement, the Security Documents, the Control
Agreements, the Letter of Credit Applications and the other documents and
agreements contemplated hereby and executed by the Borrower in favor of the
Administrative Agent or any Lender as each such Facility Document may be
amended, modified or restated and in effect from time to time.

“Fair Market Value” means (a) with respect to any Eligible Collateral described
in clauses (a) or (b) of the definition thereof, the closing price for such
security on Bloomberg, Inc. or, if Bloomberg, Inc. is not available, another
quotation service reasonably acceptable to the Administrative Agent, and (b)
with respect to any Eligible Collateral described in clauses (c) or

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(d) of the definition thereof, the amounts thereof.  Fair Market Value of
non-Dollar denominated Eligible Collateral shall be determined in accordance
with Section 2.2(a).  

“FATCA” means:

(a)Sections 1471 to 1474 of the Code  (or any amended or successor version that
is substantively comparable and not materially more onerous to comply with) and
any associated regulations or other official guidance or interpretations
thereof;

(b)any treaty, law, regulation or other official guidance enacted in any other
jurisdiction, or relating to an intergovernmental agreement between the US and
any other jurisdiction, which (in either case) facilitates the implementation of
paragraph (a) above; or

(c)any agreement pursuant to the implementation of paragraphs (a) or (b) above
with the US Internal Revenue Service, the US government or any governmental or
taxation authority in any other jurisdiction.

“FATCA Deduction” means a deduction or withholding from a payment under a
Facility Document required by FATCA.

“FATCA Exempt Party” means a Party that is entitled to receive payments free
from any FATCA Deduction.

“Fee Letter” is defined in Section 9.4.

“Financial Institution” means the Securities Intermediary or Account Bank, as
applicable, with respect to any Collateral Account.

“Fiscal Quarter” means one of the four three-month accounting periods comprising
a Fiscal Year.

“Fiscal Year” means the twelve-month accounting period commencing on January 1
and ending December 31 of each year.

“Fixed Charge” means (a) the Deed of Charge dated March 28, 2011 among the
Borrower, the Administrative Agent, the Security Trustee and the other parties
thereto and the Deed of Consent and Confirmation dated among the Borrower, The
Administrative Agent and the Security Trustee attached hereto as Exhibit F and
(b) any other debenture, deed or charge or other document which the
Administrative Agent and the Borrower may enter into with respect to Collateral
located in the United Kingdom.

“Governmental Authority” means any government (foreign or domestic) or any state
or other political subdivision thereof or any governmental body, agency,
authority, department or commission (including without limitation any taxing
authority or political subdivision) or any instrumentality or officer thereof
(including without limitation any court or tribunal and any board of insurance,
insurance department or insurance commissioner) exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government and

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any corporation, partnership or other entity directly or indirectly owned or
controlled by or subject to the control of any of the foregoing.

“Honor Date” is defined in Section 2.4(a).

“Indebtedness” of a Person means such Person’s (a) obligations for borrowed
money, (b) obligations representing the deferred purchase price of Property or
services (other than accounts payable arising in the ordinary course of such
Person’s business payable on terms customary in the trade), (c) obligations,
whether or not assumed, secured by Liens or payable out of the proceeds or
production from Property now or hereafter owned or acquired by such Person, (d)
obligations which are evidenced by notes, acceptances, or other instruments, (e)
obligations of such Person to purchase securities or other Property arising out
of or in connection with the sale of the same or substantially similar
securities or Property, (f) Capitalized Lease Obligations, (g) Contingent
Obligations, (h) actual and contingent reimbursement obligations in respect of
letters of credit, (i) any other obligation for borrowed money or other
financial accommodation which in accordance with Agreement Accounting Principles
would be shown as a liability on the consolidated balance sheet of such Person,
(j) any liability under any financing lease or so-called “synthetic lease”
transaction entered into by such Person and (k) any obligation arising with
respect to any other transaction which is the functional equivalent of or takes
the place of borrowing but which does not constitute a liability on the
consolidated balance sheet of such Person.

“ING Bilateral Facility” means that Funds at Lloyd’s Letter of Credit Agreement,
dated as of November 20, 2015, between The Navigators Group, Inc., as Borrower,
and ING Bank N.V., London Branch, as Letter of Credit Issuer, as such agreement
may be amended, restated or otherwise modified from time to time.

“Insurance Subsidiary” means each of Navigators, NSIC and any other United
States domestic Subsidiary acquired or formed after the Amendment Effective Date
which is an insurer or is authorized to act as an insurer.  For the avoidance of
doubt, Navigators Management Company, Inc. is not a Insurance Subsidiary.

“Investment” of a Person means (a) any loan, advance (other than commission,
travel and similar advances to officers and employees made in the ordinary
course of business), extension of credit (other than accounts receivable arising
in the ordinary course of business on terms customary in the trade) or
contribution of capital by such Person, (b) stocks, bonds, mutual funds,
partnership interests, membership interests, notes, debentures or other
securities owned by such Person, (c) any deposit accounts and certificate of
deposit owned by such Person and (d) structured notes, derivative financial
instruments and other similar instruments or contracts owned by such Person.

“Issuance Request” is defined in Section 2.5.

“Issue Date” means a date on which a Letter of Credit is issued hereunder.

“Lender Affiliates” means, with respect to any Lender or the Administrative
Agent, such Person’s Lending Installation, its Subsidiaries, its holding company
and Subsidiaries of its holding company.

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“Lenders” means the lending institutions listed on the signature pages of this
Agreement and their respective successors and assigns.

“Lending Installation” means, with respect to a Lender or the Administrative
Agent, the office, branch, subsidiary or affiliate of such Lender or the
Administrative Agent listed on the signature pages hereof or on a Schedule or
otherwise selected by such Lender or the Administrative Agent.

“Letter of Credit” means (a) the Existing Letters of Credit and (b) any letter
of credit issued pursuant to Article II and shall include all of the Tranche A
Letters of Credit and the Tranche B Letters of Credit.  Each Letter of Credit
shall be substantially in the form of Exhibit G.

“Letter of Credit Advance Date” is defined in Section 2.4(b).

“Letter of Credit Agent” means ING Bank N.V. located at 8-10 Moorgate,
London  EC2R 6DA, as Letter of Credit Agent for the Lenders, together with any
replacement Letter of Credit Agent arising under Article X.

“Letter of Credit Application” means “a letter of credit application
substantially in the form of Exhibit C or such other form as the Letter of
Credit Agent may from time to time employ in the ordinary course of business.

“Letter of Credit Availability Termination Date” means July 31, 2018 or any
earlier date on which the Aggregate Commitment is reduced to zero or otherwise
terminated pursuant to the terms hereof.

“Letter of Credit Fee” means the letter of credit fees payable pursuant to
Section 2.8(b).

“Letter of Credit Obligations” means, at the time of determination thereof, the
sum of (a) the Reimbursement Obligations then outstanding and (b) the aggregate
then undrawn face amount of the then outstanding Letters of Credit.

“Leverage Ratio” means, at any time, the ratio of (a) the consolidated
Indebtedness of the Borrower and its Consolidated Subsidiaries (with respect to
letters of credit obligations, only unreimbursed drawings shall be included) at
such time to (b) the sum of (i) the consolidated Indebtedness of the Borrower
and its Consolidated Subsidiaries (with respect to letters of credit
obligations, only unreimbursed drawings shall be included) plus (ii)
Consolidated Net Worth at such time.  

“License” means any license, certificate of authority, permit or other
authorization which is required to be obtained from any Governmental Authority
in connection with the operation, ownership or transaction of insurance
business.

“Lien” means any security interest, lien (statutory or other), mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance or preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever (including,

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without limitation, the interest of a vendor or lessor under any conditional
sale, Capitalized Lease or other title retention agreement).

“Lloyd’s” means The Society and Council of Lloyd’s.

“Lloyd’s Approved Bank” means any bank approved by Lloyd’s to provide Funds at
Lloyd’s letters of credit.

“Lloyd’s Comfort Letter” means a letter substantially in the form of Exhibit H.

“Loss Reserves” means, with respect to any Insurance Subsidiary at any time, the
sum of (a) all losses, including incurred losses of such Insurance Subsidiary at
such time shown on page 3, line 1 of the Annual Statement of such Insurance
Subsidiary plus (b) all loss adjustment expenses of such Insurance Subsidiary at
such time shown on page 3, line 3 of the Annual Statement of such Insurance
Subsidiary, as determined in accordance with SAP.

“Managing Agent” means Navigators Underwriting Agency Limited, a company
organized under the laws of England and Wales.

“Margin Stock” has the meaning assigned to that term under Regulation U.

“Material Adverse Effect” means a material adverse effect on (a) the business,
Property, condition (financial or otherwise) or results of operations of any of
(i) the Borrower or (ii) the Subsidiaries taken as a whole, (b) the ability of
the Borrower to perform its obligations under the Facility Documents, or (c) the
validity or enforceability of any of the Facility Documents or the rights or
remedies of the Administrative Agent or the Lenders thereunder.  Any current
examination by the Internal Revenue Service with respect to the Borrower’s Plans
will not constitute a Material Adverse Effect;  provided, however, a Material
Adverse Effect may result from any payments made or Plan changes required as a
result of such audit.

“Moody’s” means Moody’s Investors Service, Inc. or any successor thereto.

“Multiemployer Plan” means a Plan of the type described in Section 4001(a)(3) of
ERISA to which the Borrower or any member of the Controlled Group is obligated
to make contributions, or during the preceding five plan years, has made or been
obligated to make contributions.

“NAIC” means the National Association of Insurance Commissioners or any
successor thereto, or in lieu thereof, any other association, agency or other
organization performing advisory, coordination or other like functions among
insurance departments, insurance commissioners and similar Governmental
Authorities of the various states of the United States toward the promotion of
uniformity in the practices of such Governmental Authorities.

“Navigators” means Navigators Insurance Company, a New York corporation.

“NFS Deficiency” is defined in Section 2.9(e).

“Non-U.S. Lender” is defined in Section 3.3(e).

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“Notice of Assignment” is defined in Section 12.3(b).

“NSIC” means Navigators Specialty Insurance Company, a New York corporation.

“Obligations” means the Letter of Credit Obligations and all other liabilities
(if any), whether actual or contingent, of the Borrower with respect to Letters
of Credit, all accrued and unpaid fees and all expenses, reimbursements,
indemnities and other obligations of the Borrower to the Lenders or to any
Lender, the Administrative Agent, the Letter of Credit Agent or any indemnified
party hereunder arising under any of the Facility Documents.

“OFAC” is defined in Section 5.29.

“Other Taxes” is defined in Section 3.3(b).

“Participant” is defined in Section 12.2(a).

“Participant Register” is defined in Section 12.2(a).

“PATRIOT ACT” is defined in Section 9.14.

“Payment Date” means the first day of each April, July, October and January.

“PBGC” means the Pension Benefit Guaranty Corporation or any successor thereto.

“Person” means any natural person, corporation, firm, joint venture,
partnership, association, enterprise, limited liability company, trust or other
entity or organization, or any government or political subdivision or any
agency, department or instrumentality thereof.

“Plan” means an employee pension benefit plan (including a Multiemployer Plan)
which is covered by Title IV of ERISA or subject to the minimum funding
standards under Section 412 of the Code as to which the Borrower or any member
of the Controlled Group may have any liability.

“Pounds” and the sign “£” mean lawful money of the United Kingdom.

“Primary FAL” means funds at Lloyd’s in the form of (i) cash and/or investment
assets held directly at Lloyd’s and/or (ii) collateralised letters of credit
(other than Letters of Credit issued under this Agreement), which will be
immediately available to cover losses in the Supported Syndicate and which will
be utilised ahead of the Letters of Credit issued hereunder in the event that
the Lloyd’s is required to draw on the funds at Lloyd’s of the Supported
Syndicate.

“Property” of a Person means any and all property, whether real, personal,
tangible, intangible, or mixed, of such Person, or other assets owned, leased or
operated by such Person.

“Purchasers” is defined in Section 12.3(a).

“RDS” means realistic disaster scenarios as such term is used by Lloyd’s and in
respect of which, pursuant to Lloyd’s rules, the Managing Agent is obligated to
prepare and submit to Lloyd’s a report.

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“Regulation D” means Regulation D of the Board of Governors of the Federal
Reserve System as from time to time in effect and shall include any successor
thereto or other regulation or official interpretation of said Board of
Governors relating to reserve requirements applicable to member banks of the
Federal Reserve System.

“Regulation T” means Regulation T of the Board of Governors of the Federal
Reserve System as from time to time in effect and shall include any successor
thereto or other regulation or official interpretation of such Board of
Governors relating to the extension of credit by securities brokers and dealers
for the purpose of purchasing or carrying margin stocks applicable to such
Persons.

“Regulation U” means Regulation U of the Board of Governors of the Federal
Reserve System as from time to time in effect and shall include any successor
thereto or other regulation or official interpretation of said Board of
Governors relating to the extension of credit by banks for the purpose of
purchasing or carrying margin stocks applicable to member banks of the Federal
Reserve System.

“Regulation X” means Regulation X of the Board of Governors of the Federal
Reserve Systems from time to time in effect and shall include any successor
thereto or other regulation or official interpretation of said Board of
Governors relating to the extension of credit by the specified lenders for the
purpose of purchasing or carrying margin stocks applicable to such Persons.

“Reimbursement Obligations” means, at any time, the aggregate (without
duplication) of the Obligations of the Borrower to the Lenders and/or the
Administrative Agent in respect of all unreimbursed payments or disbursements
made by the Lenders and/or the Administrative Agent under or in respect of draws
made under the Letters of Credit.

“Reinsurance Guidelines” is defined in Section 6.21(c).

“Release” is defined in the Comprehensive Environmental Response, Compensation
and Liability Act, as amended, 42 U.S.C. 39601 et seq.

“Reportable Event” means a reportable event as defined in Section 4043 of ERISA
and the regulations issued under such section, with respect to a Plan,
excluding, however, such events as to which the PBGC has by regulation waived
the requirement of Section 4043(a) of ERISA that it be notified within 30 days
of the occurrence of such event; provided, however, that a failure to meet the
minimum funding standard of Section 412 of the Code and of Section 302 of ERISA
shall be a Reportable Event regardless of the issuance of any such waiver of the
notice requirement in accordance with either Section 4043(a) of ERISA or
Section 412(d) of the Code.

“Required Amount” means the aggregate amount required to be deposited and held
in Collateral Accounts pursuant to Sections 2.9 and 8.1 hereof.

“Required Lenders” means Lenders in the aggregate having at least 66⅔% of the
Aggregate Commitment or, if the Aggregate Commitment has been terminated, the
aggregate amount of the outstanding Letter of Credit Obligations; provided,
however, the Aggregate

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Commitment or outstanding Letter of Credit Obligations of any Defaulting Lender
shall be deemed to be zero.

“Restricted Person” is defined in Section 5.29.

“S&P” means Standard and Poor’s Ratings Services, a division of The McGraw Hill
Companies, Inc. or any successor thereto.

“S&P Rating” means, as to any insurance company, its financial strength rating
assigned by S&P.

“Sanctions” means all economic or financial trade embargoes or sanctions
imposed, administered or enforced by (a) the U. S. Government, including those
administered by OFAC, (b) the U.S. Department of State, (c) the United Nations
Security Council, (d) the European Union, (e) Her Majesty’s Treasury, (f) any
other sanctions authority that has jurisdictional authority over the Borrower or
any of its Subsidiaries or (g) any other sanctions authority that has
jurisdictional authority over a Lender, so long as such Lender has advised the
Borrower of same.

“SAP” means, with respect to any Insurance Subsidiary, the statutory accounting
practices prescribed or permitted by the insurance commissioner (or other
similar authority) in the jurisdiction of such Person for the preparation of
annual statements and other financial reports by insurance companies of the same
type as such Person in effect from time to time, applied in a manner consistent
with those used in preparing the Statutory Financial Statements referred to in
Section 5.5.

“Schedule” refers to a specific schedule to this Agreement, unless another
document is specifically referenced.

“SEC Reports” means the reports filed by the Borrower with the Securities and
Exchange Commission on Form 8-K, Form 10-Q or Form 10-K.

“Section” means a numbered section of this Agreement, unless another document is
specifically referenced.

“Secured Parties” means the Administrative Agent, the Letter of Credit Agent,
the Security Trustee under each Fixed Charge and the Lenders.

“Security Agreement” means (a) the security agreement dated as of March 28, 2011
between the Borrower and the Administrative Agent attached hereto as Exhibit E
and (b) any other security agreement or other document which may be entered into
by the Administrative Agent and the Borrower with respect to the Collateral
located in the United States.

“Security Documents” means each Security Agreement, each Control Agreement and
each Fixed Charge.

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“Security Trustee” means ING Bank N.V., London Branch, as security trustee for
the Secured Parties and appointed under the Fixed Charges together with any
successor appointed pursuant to the terms thereof.

“Securities Intermediary” means any “securities intermediary” within the meaning
of Section 8.102(a)(14) of the UCC at which any securities account constituting
a Collateral Account is held, which shall be (a) located in the United States
and (b) reasonably acceptable to the Administrative Agent.

“Significant Insurance Subsidiary” means a Significant Subsidiary which is a
Insurance Subsidiary.  For the avoidance of doubt, Navigators Management
Company, Inc. shall not be a Significant Insurance Subsidiary.

“Significant Subsidiary” means, at any time, a direct United States domestic
Subsidiary of the Borrower the assets of which are greater than or equal to five
percent (5%) of the Consolidated Total Assets of the Borrower and its
Consolidated Subsidiaries.

“Single Employer Plan” means a Plan maintained by the Borrower or any member of
the Controlled Group for employees of the Borrower or any member of the
Controlled Group.

“Solvency Surplus” means the solvency surplus, if any,  on any open years of
account for the Supported Syndicate, as reported in the solvency statements
prepared by Lloyd’s.

“Statutory Financial Statements” is defined in Section 5.5.

“Statutory Surplus” means, with respect to any Insurance Subsidiary at any time,
the statutory capital and surplus of such Insurance Subsidiary at such time, as
determined in accordance with SAP (“Liabilities, Surplus and Other Funds”
statement, page 3, line 35 of the Annual Statement).

“Subsidiary” of a Person means (a) any corporation more than 50% of the
outstanding securities having ordinary voting power of which shall at the time
be owned or controlled, directly or indirectly, by such Person or by one or more
of its Subsidiaries or by such Person and one or more of its Subsidiaries or (b)
any partnership, association, joint venture, limited liability company or
similar business organization more than 50% of the ownership interests having
ordinary voting power of which shall at the time be so owned or
controlled.  Unless otherwise expressly provided, all references herein to a
“Subsidiary” shall mean a Subsidiary of the Borrower.

“Substantial Portion” means, with respect to the Property of the Borrower and
its Consolidated Subsidiaries, Property which (a) represents more than 10% of
the Consolidated Total Assets of the Borrower and its Consolidated Subsidiaries,
as would be shown in the consolidated financial statements of the Borrower and
its Consolidated Subsidiaries as at the end of the quarter next preceding the
date on which such determination is made or (b) is responsible for more than 10%
of the consolidated premiums or of the Consolidated Net Income of the Borrower
and its Consolidated Subsidiaries for the 12-month period ending as of the end
of the quarter next preceding the date of determination.

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“Supported Syndicate” means Lloyd’s Syndicate 1221 underwriting insurance
business at Lloyd’s through the Managing Agent.

“Taxes” means any and all present or future taxes, duties, levies, imposts,
deductions, charges or withholdings and any and all liabilities with respect to
the foregoing, but excluding Excluded Taxes.

“Terence Deeks Family” means, collectively, Terence N. Deeks; his spouse; any
natural person who is a lineal descendant of Terence N. Deeks; the spouse,
children, or grandchildren of any such natural person; any trust of which any of
the foregoing is or are the sole beneficiary or beneficiaries; or the estate,
executor, administrator, or legal guardian of any of the foregoing.

“Termination Event” means, with respect to a Plan which is subject to Title IV
of ERISA, (a) a Reportable Event, (b) the withdrawal of the Borrower or any
other member of the Controlled Group from such Plan during a plan year in which
the Borrower or any other member of the Controlled Group was a “substantial
employer” as defined in Section 4001(a)(2) of ERISA or was deemed such under
Section 4068(f) of ERISA, (c) the termination of such Plan, the filing of a
notice of intent to terminate such Plan or the treatment of an amendment of such
Plan as a termination under Section 4041 of ERISA, (d) the institution by the
PBGC of proceedings to terminate such Plan or (e) any event or condition which
might constitute grounds under Section 4042 of ERISA for the termination of, or
appointment of a trustee to administer, such Plan.

“Tranche A Commitment” means, as to any Lender, the commitment of such Lender
pursuant to Section 2.1(a) to issue Tranche A Letters of Credit for the Borrower
in an aggregate principal amount at any one time outstanding not to exceed the
Dollar amount set forth opposite such Lender’s name on Schedule 1 or in the
Assignment and Assumption pursuant to which such Lender becomes a party hereto,
as applicable, as such amount may be adjusted from time to time in accordance
with this Agreement. The initial amount of the Tranche A Commitment of each
Lender is set forth on Schedule 1.

“Tranche A L/C Obligations” means, at any time, the Letter of Credit Obligations
with respect to Tranche A Letters of Credit.

“Tranche A Letter of Credit” means a Letter of Credit issued pursuant to the
Tranche A Commitment.

“Tranche B Commitment” means, as to any Lender, the commitment of such Lender
pursuant to Section 2.1(b) to issue Tranche B Letters of Credit for the Borrower
in an aggregate principal amount at any one time outstanding not to exceed the
Pound amount set forth opposite such Lender’s name on Schedule 1 or in the
Assignment and Assumption pursuant to which such Lender becomes a party hereto,
as applicable, as such amount may be adjusted from time to time in accordance
with this Agreement. The initial amount of the Tranche B Commitment of each
Lender is set forth on Schedule 1.

“Tranche B L/C Obligations” means, at any time, the Letter of Credit Obligations
with respect to Tranche B Letters of Credit.

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“Tranche B Letter of Credit” means a Letter of Credit issued pursuant to the
Tranche A Commitment.

“Transferee” is defined in Section 12.4.

“Total Investment Portfolio” means, as of any date, the “Total Investments and
Cash” of the Borrower and its Consolidated Subsidiaries as shown on the
Borrower’s financial statements.

“UCC” means the Uniform Commercial Code as in effect in the State of New York or
the State of Delaware, as applicable, from time to time.

“UK Collateral Account” means account nos. ending 20505406 and 20505305 and each
other account held at ING Bank N.V., London Branch, and subject to a Fixed
Charge.

“Unfunded Liabilities” means the amount (if any) by which the present value of
all vested and unvested accrued benefits under all Single Employer Plans exceeds
the fair market value of all such Plan assets allocable to such benefits, all
determined as of the then most recent valuation date for such Plans using PBGC
actuarial assumptions for single employer plan terminations.

“Unmatured Default” means an event which but for the lapse of time or the giving
of notice, or both, would constitute a Default.

“Unreimbursed Amount” is defined in Section 2.4(b).

“Unused Fees” means the fees payable pursuant to Section 2.8(a).

“Wholly‑Owned Subsidiary” of a Person means (a) any Subsidiary all (or, in the
case of Navigators N.V., all but one) of the outstanding voting securities of
which shall at the time be owned or controlled, directly or indirectly, by such
Person or one or more Wholly‑Owned Subsidiaries of such Person, or by such
Person and one or more Wholly‑Owned Subsidiaries of such Person, or (b) any
partnership, limited liability company, association, joint venture or similar
business organization 100% of the ownership interests having ordinary voting
power of which shall at the time be so owned or controlled.

“Write-Down and Conversion Powers” means, with respect to any EEA Resolution
Authority, the write-down and conversion powers of such EEA Resolution Authority
from time to time under the Bail-In Legislation for the applicable EEA Member
Country, which write-down and conversion powers are described in the EU Bail-In
Legislation Schedule.

The foregoing definitions shall be equally applicable to both the singular and
plural forms of the defined terms.

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ARTICLE II

THE LETTER OF CREDIT FACILITY

2.1Issuance of Letters of Credit.

(a)Tranche A Letters of Credit.  From and after the date hereof to but excluding
the Letter of Credit Availability Termination Date, each Lender severally
agrees, upon the terms and conditions set forth in this Agreement, to issue at
the request and for the account of the Borrower, such Lender’s Applicable
Percentage of the Tranche A Commitment, one or more Tranche A Letters of Credit
denominated in Dollars for the account of the Borrower to support the
obligations of the Corporate Member with respect to the Supported Syndicate and
to increase the stated amount of any Tranche A Letters of Credit issued
hereunder;  provided, however, that no Lender shall be under any obligation to
issue or increase, and the Letter of Credit Agent shall not issue or increase,
any Tranche A Letter of Credit if: (i) the expiry date of such Tranche A Letter
of Credit would be after December 31, 2021, (ii) any order, judgment or decree
of any Governmental Authority or other regulatory body with jurisdiction over
any Lender shall purport by its terms to enjoin or restrain any Lender from
issuing or increasing such Tranche A Letter of Credit, or any law or
governmental rule, regulation, policy, guideline or directive (whether or not
having the force of law) from any Governmental Authority or other regulatory
body with jurisdiction over any Lender prohibit, or request that any Lender
refrain from, the issuance of Tranche A Letters of Credit in particular or shall
impose upon any Lender with respect to any Tranche A Letter of Credit any
restriction or reserve or capital requirement (for which such Lender is not
otherwise compensated) or any unreimbursed loss, cost or expense which was not
applicable, in effect and known to such Lender as of the date of this Agreement
and which such Lender in good faith deems material to it, (iii) one or more of
the conditions to such issuance or increase contained in Section 4.2 is not then
satisfied; (iv) after giving effect to such issuance or increase, any Lender’s
aggregate outstanding amount of the Tranche A L/C Obligations would exceed such
Lender’s Tranche A Commitment; or (v) there is a Defaulting Lender.  

(b)Tranche B Letters of Credit.  From and after the date hereof to but excluding
the Letter of Credit Availability Termination Date, each Lender severally
agrees, upon the terms and conditions set forth in this Agreement, to issue at
the request and for the account of the Borrower, such Lender’s Applicable
Percentage of the Tranche B Commitment, one or more Tranche B Letters of Credit
denominated in Pounds for the account of the Borrower to support the obligations
of the Corporate Member with respect to the Supported Syndicate and to increase
the stated amount of any Tranche B Letters of Credit issued
hereunder;  provided, however, that no Lender shall be under any obligation to
issue or increase, and the Letter of Credit Agent shall not issue or increase,
any Tranche B Letter of Credit if: (i) the expiry date of such Tranche B Letter
of Credit would be after December 31, 2021, (ii) any order, judgment or decree
of any Governmental Authority or other regulatory body with jurisdiction over
any Lender shall purport by its terms to enjoin or restrain any Lender from
issuing or increasing such Tranche B Letter of Credit, or any law or
governmental rule, regulation, policy, guideline or directive (whether or not
having the force of law) from any Governmental Authority or

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other regulatory body with jurisdiction over any Lender prohibit, or request
that any Lender refrain from, the issuance of Tranche B Letters of Credit in
particular or shall impose upon any Lender with respect to any Tranche B Letter
of Credit any restriction or reserve or capital requirement (for which such
Lender is not otherwise compensated) or any unreimbursed loss, cost or expense
which was not applicable, in effect and known to such Lender as of the date of
this Agreement and which such Lender in good faith deems material to it, (iii)
one or more of the conditions to such issuance or increase contained in Section
4.2 is not then satisfied; (iv) after giving effect to such issuance or
increase, any Lender’s aggregate outstanding amount of the Tranche B L/C
Obligations would exceed such Lender’s Tranche B Commitment; or (v) there is a
Defaulting Lender.  

(c)In no event shall the expiration date of any Letter of Credit or the date for
payment of any draft presented thereunder and accepted by the Lender, be later
than the earlier of (A) December 31, 2021 or (B) four (4) years after the date
of the related Expiry Notice.  The Letter of Credit Agent shall not issue a
Letter of Credit except with Lloyd’s as the beneficiary thereof.  The Letter of
Credit Agent shall not (x) permit the renewal or extension of any Letter of
Credit at any time (A) during the continuation of a Default or Unmatured Default
or (B) after December 31, 2017 or (y) permit the increase of any Letter of
Credit  at any time (A) during the continuation of a Default or Unmatured
Default or (B) after the Letter of Credit Availability Termination Date.

(d)If it becomes unlawful in any applicable jurisdiction for any Lender to
perform any of its obligations as contemplated by this Agreement or to maintain
or to allow to remain outstanding any Letter of Credit: (i) such Lender shall
notify the Borrower and the Letter of Credit Agent and shall not thereafter be
obliged to issue any Letter of Credit; and(ii) if such Lender so requires, the
Borrower shall on such date as such Lender specifies to the Borrower and the
Letter of Credit Agent which, if allowed by law, is on no less than 30 days’
notice, ensure that the Letter of Credit Obligations of such Lender under or in
respect of each outstanding Letter of Credit are reduced to zero or repaid in
full.

(e)The Letter of Credit Agent (i) shall issue an Expiry Notice no later than
December 31, 2017 for outstanding Letters of Credit and (ii) may, and upon the
request of the Required Lenders shall, issue an Expiry Notice when a Default has
occurred and is continuing; provided, however, that upon the occurrence of an
Unmatured Default pursuant to Sections 7.6 and 7.7, the Letter of Credit Agent
shall immediately issue an Expiry Notice.

(f)At the request of the Borrower, Letters of Credit may be issued with the
Corporate Member as a co-applicant, so long as the Borrower is also a
co-applicant under the applicable Letter of Credit Application.  The fact that
the Corporate Member is an applicant shall not affect the obligations of the
Borrower with respect to such Letters of Credit hereunder or under any Facility
Document in any way.  Any Letter of Credit Application for a Letter of Credit
with respect to which the Corporate Member is a co-applicant shall include
language substantially similar to that set forth in Exhibit C or otherwise
acceptable to the Letter of Credit Agent.

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(g)Each Lender’s obligation to pay its Applicable Percentage of all draws under
the Letters of Credit, absent gross negligence or willful misconduct by Letter
of Credit Agent in honoring any such draw, shall be absolute, unconditional and
irrevocable and in each case shall be made without counterclaim or set-off by
such Lender.

(h)On and after the Closing Date, the Existing Letters of Credit shall be deemed
to be Tranche A Letters of Credit or Tranche B Letters of Credit as indicated on
Schedule 1.2, issued under this Agreement for all purposes, including for
purposes of the fees to be collected pursuant to Section 2. 8.

2.2Conversion Principles.  

(a)For purposes of determining the (i) Collateral Value as of any date, (ii)
Fair Market Value on any date or  (iii) Required Amount on any date,   Eligible
Collateral and Letter of Credit Obligations denominated in Pounds will be
converted to Dollars at the Conversion Rate as of the date of determination (and
in the event of a disagreement as to such Fair Market Value between the Borrower
and the Administrative Agent, the determination of the Administrative Agent
shall control).

(b)For purposes of determining a Lender’s Applicable Percentage of the Aggregate
Commitment, the Tranche B Commitment or, if the Tranche B Commitment has been
terminated,  the Tranche B L/C Obligations,  shall be converted to
Dollars at the Conversion Rate as of the date of determination.

2.3Reductions in Commitments.  (a) The Borrower may permanently reduce the
Tranche A Commitment or the Tranche B Commitment in whole, or in part ratably
among the Lenders in integral multiples of $5,000,000, upon at least five (5)
Business Days’ written notice to the Administrative Agent, which notice shall
specify the amount of such reduction; provided, however, that (i) the amount of
the Tranche A Commitment may not be reduced below the aggregate amount of the
outstanding Tranche A L/C Obligations and (ii) the amount of the Tranche B
Commitment may not be reduced below the aggregate amount of the outstanding
Tranche B L/C Obligations.

2.4Reimbursement Obligations.  (a) Upon receipt from the beneficiary of any
Letter of Credit or any notice of a drawing under such Letter of Credit (a
“Drawing Request”), the Letter of Credit Agent shall notify the Administrative
Agent and the Borrower of the receipt of such Drawing Request and of the date
the Letter of Credit Agent will honor such request (each such date, an “Honor
Date”).  Not later than 10:00 a.m. (London time) on such Honor Date or the
following Business Day in the event that the Borrower shall not have received at
least twenty-four hours notice of such Honor Date, the Borrower shall provide
the Letter of Credit Agent the amount of the Drawing Request in the currency in
which the applicable Letter of Credit was issued.  Any notice given by the
Letter of Credit Agent or the Administrative Agent pursuant to this Section
2.4(a) may be given by telephone if immediately confirmed in writing; provided
that the lack of such an immediate confirmation shall not affect the
conclusiveness or binding effect of such notice.

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(b)(i) With respect to any Drawing Request, if funds are not received by the
Letter of Credit Agent from the Borrower prior to 11:00 a.m. (London time) on
the Honor Date or the following Business Day in the event that the Borrower
shall not have received at least twenty-four hours notice of such Honor Date in
the amount and currency of such Drawing Request, the Administrative Agent shall
promptly notify each Lender of such Drawing Request, the amount of the
unreimbursed drawing (the “Unreimbursed Amount”) and such Lender’s Applicable
Percentage of such Unreimbursed Amount.  Each Lender shall make funds available
in the applicable currency to the Letter of Credit Agent in an amount equal to
its Applicable Percentage of the Unreimbursed Amount not later than 1:00 p.m.
(London time) on the Business Day specified in such notice by the Administrative
Agent (the “Letter of Credit Advance Date”).  To the extent that funds are
received by the Letter of Credit Agent from the Lenders prior to 2:00 p.m.
(London time) on the Letter of Credit Advance Date, the Letter of Credit Agent
shall promptly make such funds available to the beneficiary of such Letter of
Credit on such date.  To the extent that the Letter of Credit Agent has not
delivered funds to any beneficiary of a Letter of Credit on behalf of a Lender
on the Letter of Credit Advance Date, if funds are received by the Letter of
Credit Agent from such Lender: (i) after 2:00 p.m. (London time) on the Letter
of Credit Advance Date, the Letter of Credit Agent shall make such funds
available to such beneficiary on the next Business Day; (ii) prior to 2:00 p.m.
(London time) on any Business Day after the Letter of Credit Advance Date, the
Letter of Credit Agent shall make those funds available to such beneficiary on
such Business Day; and (iii) after 2:00 p.m. (London time) on any Business Day
after the Letter of Credit Advance Date, the Letter of Credit Agent shall make
those funds available to such beneficiary on the next Business Day following
such Business Day.

(ii) Notwithstanding any provisions to the contrary in any Letter of Credit
Application, the Borrower agrees to pay the Letter of Credit Agent for the
benefit of the Lenders no later than the time specified in this Agreement.

(iii)With respect to any Unreimbursed Amount, the Borrower shall have a
Reimbursement Obligation in the amount of the Unreimbursed Amount from the
Lenders to the extent that they have provided funds with respect to such Letter
of Credit pursuant to Section 2.4(b)(i).  Reimbursement Obligations shall be due
and payable in the applicable currency on demand (together with interest) and
shall bear interest at the Default Rate.  Any payment by the Borrower in respect
of such Reimbursement Obligation shall be made to the Administrative Agent and
upon receipt applied by the Administrative Agent in accordance with Section
2.4(c).

(c)At any time after the Letter of Credit Agent has made a payment under any
Letter of Credit and has received from any Lender such Lender’s Letter of Credit
Advance in respect of such payment in accordance with Section 2.4(b), if the
Letter of Credit Agent or Administrative Agent receives any payment in respect
of the related Reimbursement Obligation or interest thereon (whether directly
from the Borrower or otherwise, including proceeds of Collateral applied thereto
by the Administrative Agent), the Administrative Agent will distribute to such
Lender its Applicable Percentage thereof

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in the same funds as those received by the Letter of Credit Agent or the
Administrative Agent, as the case may be.

(d)If any payment received by the Letter of Credit Agent or the Administrative
Agent pursuant to Section 2.4(b) (including any payment under Article XI) and
such payment or the proceeds of such setoff or any part thereof is subsequently
invalidated, declared to be fraudulent or preferential, set aside or required
(including pursuant to any settlement entered into by the Letter of Credit
Agent, the Administrative Agent or such Lender in its discretion) to be repaid
to a trustee, receiver or any other party, in connection with any insolvency
proceeding or otherwise, then (x) to the extent of such recovery, the obligation
or part thereof originally intended to be satisfied shall be revived and
continued in full force and effect as if such payment had not been made or such
setoff had not occurred, and (y) each Lender shall pay to the Letter of Credit
Agent or the Administrative Agent, as applicable, its Applicable Percentage
thereof on demand of the Letter of Credit Agent or the Administrative Agent, as
applicable, plus interest thereon from the date of such demand to the date such
amount is returned by such Lender, at a rate per annum equal to the Eurocurrency
Rate from time to time in effect.  The obligations of the Lenders under this
clause shall survive the payment in full of the Obligations and the termination
of this Agreement.

2.5Procedure for Issuance. (a)  Prior to the issuance of each new Letter of
Credit and as a condition of such issuance, the Borrower shall deliver to the
Letter of Credit Agent a Letter of Credit Application signed by the Borrower,
together with such other documents or items as may be required pursuant to the
terms thereof, and the proposed form and content of such Letter of Credit shall
be reasonably satisfactory to the Letter of Credit Agent.  Each Letter of Credit
shall be issued no earlier than two (2) Business Days after delivery of the
foregoing documents, which delivery may be by the Borrower to the Letter of
Credit Agent by telecopy, telex or other electronic means followed by delivery
of executed originals within five (5) days thereafter.  The documents so
delivered shall be in compliance with the requirements set forth in
Section 2.1(c), and shall specify therein (a) the stated amount of the Letter of
Credit requested, (b) the effective date of issuance of such requested Letter of
Credit, which shall be a Business Day, (c) whether the Letter of Credit is to be
a Tranche A Letter of Credit or a Tranche B Letter of Credit and (d) the
aggregate amount of Tranche A L/C Obligations or Tranche B L/C Obligations, as
applicable, which are outstanding and which will be outstanding after giving
effect to the requested Letter of Credit issuance.  The delivery of the
foregoing documents and information shall constitute an “Issuance Request” for
purposes of this Agreement.  Subject to the terms and conditions of Section 2.1
and provided that the applicable conditions set forth in Section 4.2 hereof have
been satisfied, the Letter of Credit Agent (on behalf of the Lenders) shall, on
the requested date, issue a Letter of Credit on behalf of the Borrower in
accordance with the Letter of Credit Agent’s usual and customary business
practices.  In addition, any amendment of an existing Letter of Credit shall be
deemed to be an issuance of a new Letter of Credit and shall be subject to the
requirements set forth above.  The Administrative Agent shall give the Lenders
prompt written notice of the issuance of any Letter of Credit.

(b)The Letter of Credit Agent is hereby authorized to execute and deliver each
Letter of Credit and each amendment to a Letter of Credit on behalf of each
Lender.  The Letter of Credit Agent shall use the Applicable Percentage of each
Lender under

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each Letter of Credit as its “Commitment”.  The Letter of Credit Agent shall not
amend any Letter of Credit to change the “Commitment” of a Lender or add or
delete a Lender liable thereunder unless such amendment is done in connection
with an assignment in accordance with Section 12.3.  Each Lender hereby
irrevocably constitutes and appoints the Letter of Credit Agent its true and
lawful attorney-in-fact for and on behalf of such Lender with full power of
substitution and revocation in its own name or in the name of the Letter of
Credit Agent to issue, execute and deliver, as the case may be, each Letter of
Credit and each amendment to a Letter of Credit and to carry out the purposes of
this Agreement with respect to Letters of Credit.  Upon request, each Lender
shall execute such powers of attorney or other documents as any beneficiary of
any Letter of Credit may reasonably request to evidence the authority of the
Letter of Credit Agent to execute and deliver such Letter of Credit and any
amendment or other modification thereto on behalf of the Lenders.

(c)The Letter of Credit Agent shall act on behalf of the Lenders with respect to
any Letters of Credit and the documents associated therewith, and the Letter of
Credit Agent shall have all of the benefits and immunities (A) provided to the
Administrative Agent in Article X with respect to any acts taken or omissions
suffered by the Letter of Credit Agent in connection with Letters of Credit
issued by it or proposed to be issued by it and Letter of Credit Applications
pertaining to such Letters of Credit as fully as if the term “Administrative
Agent” as used in Article X includes the Letter of Credit Agent as with respect
to such acts or omissions, and (B) as additionally provided herein with respect
to the Letter of Credit Agent.

2.6Nature of the Agent and Lenders’ Obligations.  (a)  Each Lender and the
Borrower agree that, in paying any drawing under a Letter of Credit, the Letter
of Credit Agent shall not have any responsibility to obtain any document (other
than any sight draft, certificates and documents expressly required by the
Letter of Credit) or to ascertain or inquire as to the validity or accuracy of
any such document or the authority of the Person executing or delivering any
such document.  Neither the Letter of Credit Agent nor any of its respective
Affiliates shall be liable to for (i) any action taken or omitted in connection
herewith at the request or with the approval of the Lenders or the Required
Lenders, as applicable; (ii) any action taken or omitted in the absence of gross
negligence or willful misconduct; or (iii) the due execution, effectiveness,
validity or enforceability of any document or instrument related to any Letter
of Credit or Letter of Credit Application.

(b)As between the Borrower and the Lenders and the Letter of Credit Agent, the
Borrower assumes all risks of the acts and omissions of, or misuse of the
Letters of Credit by, the respective beneficiaries of the Letters of Credit;
provided, however, that the Borrower may have a claim against the Letter of
Credit Agent and the Letter of Credit Agent may be liable to the Borrower, to
the extent, but only to the extent, of any direct (as opposed to consequential
or exemplary) damages suffered by the Borrower which the Borrower proves were
caused by the willful misconduct or gross negligence in determining whether
documents presented under a Letter of Credit comply with the terms of such
Letter of Credit.  In furtherance and not in limitation of the foregoing,
neither the Letter of Credit Agent nor the Lenders shall be responsible for: (i)
the form, validity, sufficiency, accuracy, genuineness or legal effect of any
document submitted by any

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party in connection with the application for an issuance of a Letter of Credit,
even if it should in fact prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent or forged, (ii) the validity or sufficiency
of any instrument transferring or assigning or purporting to transfer or assign
a Letter of Credit or the rights or benefits thereunder or proceeds thereof, in
whole or in part, which may prove to be invalid or ineffective for any reason,
(iii) the failure of the beneficiary of a Letter of Credit to comply fully with
conditions required to be satisfied by any Person other than the Letter of
Credit Agent in order to draw upon such Letter of Credit, (iv) errors,
omissions, interruptions or delays in transmission or delivery of any messages,
by mail, cable, telegraph, telex or otherwise, (v) errors in the interpretation
of technical terms, (vi) the misapplication by the beneficiary of a Letter of
Credit of the proceeds of any drawing under such Letter of Credit or (vii) any
consequences arising from causes beyond control of the Letter of Credit Agent or
the Lenders.

(c)In furtherance and extension and not in limitation of the specific provisions
hereinabove set forth, any action taken or omitted by the Letter of Credit Agent
under or in connection with the Letters of Credit or any related certificates,
if taken or omitted in good faith, shall not put the Letter of Credit Agent or
any Lender under any resulting liability to the Borrower or relieve the Borrower
of any of its obligations hereunder to the Lenders or any such Person.

(d)The Borrower agrees to pay to the Letter of Credit Agent for the benefit of
the Lenders the amount of all Reimbursement Obligations owing in respect of any
Letter of Credit immediately when due, under all circumstances, including,
without limitation, any of the following circumstances:  (w) any lack of
validity or enforceability of this Agreement or any of the other Facility
Documents, (x) the existence of any claim, set-off, defense or other right which
the Borrower or any account party may have at any time against a beneficiary
named in a Letter of Credit, any transferee of any Letter of Credit (or any
Person for whom any such transferee may be acting), any Lender or any other
Person, whether in connection with this Agreement, any Letter of Credit, the
transactions contemplated herein or any unrelated transactions (including any
underlying transaction between the Borrower or any account party and the
beneficiary named in any Letter of Credit), (y) the validity, sufficiency or
genuineness of any document which the Letter of Credit Agent has determined in
good faith complies on its face with the terms of the applicable Letter of
Credit, even if such document should later prove to have been forged,
fraudulent, invalid or insufficient in any respect or any statement therein
shall have been untrue or inaccurate in any respect or (z) the surrender or
impairment of any security for the performance or observance of any of the terms
hereof.

(e)Each Lender acknowledges that any Letter of Credit issued pursuant to this
Agreement will be drawn by Lloyd’s ahead of any letters of credit issued
pursuant to the ING Bilateral Facility.

2.7Notification of Issuance Requests.  Promptly after receipt thereof, the
Letter of Credit Agent will notify each Lender of the contents of each Issuance
Request received by it hereunder.

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2.8Fees, Interest and Payments Generally.

(a)Unused Fee.  

(i)  The Borrower agrees to pay to the Administrative Agent for the account of
each Lender with respect to its Tranche A Commitment an Unused Fee at a rate per
annum equal to the Applicable Unused Fee Rate on the daily unused portion of
such Lender’s Tranche A Commitment from the last “Payment Date” under and as
defined in the Existing Credit Agreement to and including the Letter of Credit
Availability Termination Date, calculated with respect to actual days elapsed on
the basis of a 360-day year and payable in Dollars on each Payment Date
hereafter and on the Letter of Credit Availability Termination Date or, if
later, upon receipt of a bill from the Administrative Agent.  During the
continuance of a Default, the Required Lenders may, at their option, by notice
to the Borrower, declare that the Applicable Unused Fee Rate shall accrue at the
Default Rate; provided, that during the continuance of a Default under
Section 7.6 or 7.7, the Applicable Unused Fee Rate shall accrue at the Default
Rate without any election or action on the part of the Administrative Agent or
any Lender.

(ii) The Borrower agrees to pay to the Administrative Agent for the account of
each Lender with respect to its Tranche B Commitment an Unused Fee at a rate per
annum equal to the Applicable Unused Fee Rate on the daily unused portion of
such Lender’s Tranche B Commitment from the last “Payment Date” under and as
defined in the Existing Credit Agreement to and including the Letter of Credit
Availability Termination Date, calculated with respect to actual days elapsed on
the basis of a 365-day year and payable in Pounds on each Payment Date hereafter
and on the Letter of Credit Availability Termination Date or, if later, upon
receipt of a bill from the Administrative Agent.  During the continuance of a
Default, the Required Lenders may, at their option, by notice to the Borrower,
declare that the Applicable Unused Fee Rate shall accrue at the Default Rate;
provided, that during the continuance of a Default under Section 7.6 or 7.7, the
Applicable Unused Fee Rate shall accrue at the Default Rate without any election
or action on the part of the Administrative Agent or any Lender.

(iii)The accrued and unpaid Unused Fee due under the Existing Credit Agreement
shall be paid within five (5) Business Days of the Amendment Effective Date.

(b)Letter of Credit Fee.

(i) The Borrower agrees to pay to the Administrative Agent for the pro-rata
account of the Lenders in Dollars a Letter of Credit Fee with respect to each
Tranche A Letter of Credit from and including the date of issuance thereof until
the date such Tranche A Letter of Credit is fully drawn, canceled or expired, in
an amount equal to the Applicable Letter of Credit Fee Rate on the aggregate
amount from time to time available to be drawn on such Tranche A Letter of
Credit, calculated with respect to actual days elapsed on the basis of a 360-day
year and

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payable quarterly in arrears on each Payment Date in each year and upon the
expiration, cancellation or utilization in full of such Tranche A Letter of
Credit.  During the continuance of a Default, the Required Lenders may, at their
option, by notice to the Borrower, declare that the Applicable Letter of Credit
Fee Rate shall accrue at the Default Rate; provided, that during the continuance
of a Default under Section 7.6 or 7.7, the Applicable Letter of Credit Fee Rate
shall accrue at the Default Rate without any election or action on the part of
the Administrative Agent or any Lender.

(ii) The Borrower agrees to pay to the Administrative Agent for the pro-rata
account of the Lenders in Pounds a Letter of Credit Fee with respect to each
Tranche B Letter of Credit from and including the date of issuance thereof until
the date such Tranche B Letter of Credit is fully drawn, canceled or expired, in
an amount equal to the Applicable Letter of Credit Fee Rate on the aggregate
amount from time to time available to be drawn on such Tranche B Letter of
Credit, calculated with respect to actual days elapsed on the basis of a 365-day
year and payable quarterly in arrears on each Payment Date in each year and upon
the expiration, cancellation or utilization in full of such Tranche B Letter of
Credit.  During the continuance of a Default, the Required Lenders may, at their
option, by notice to the Borrower, declare that the Applicable Letter of Credit
Fee Rate shall accrue at the Default Rate; provided, that during the continuance
of a Default under Section 7.6 or 7.7, the Applicable Letter of Credit Fee Rate
shall accrue at the Default Rate without any election or action on the part of
the Administrative Agent or any Lender.

(iii)The accrued and unpaid Letter of Credit Fees due under the Existing Credit
Agreement shall be paid within five (5) Business Days of the Amendment Effective
Date.

(c)Interest.  Interest shall be calculated on the basis of (i) a 365-day year in
the case of interest on Tranche B L/C Obligations and (ii) a 360-day year in the
case of interest on all other Obligations and in each case shall be payable at
the time the Obligation which accrued such interest is paid and
upon  demand.  Interest on Tranche A L/C Obligations shall be payable in
Dollars.  Interest on Tranche B L/C Obligations shall be payable in
Pounds.  Interest on all other Obligations shall be payable in Dollars.

(d)Payments Generally.  All payments to be made by the Borrower shall be made
without condition or deduction for any counterclaim, defense, recoupment or
setoff, including any reduction or withholding for taxes (except as otherwise
provided in Section 3.3).   The Borrower shall make each payment hereunder on
the date due in the applicable currency, in immediately available funds, to such
account and at such location as the Letter of Credit Agent or Administrative
Agent, as applicable, may from time to time specify.  

(e)Defaulting Lender.  If at any time a Lender is a Defaulting Lender, then, to
the extent permitted by applicable law (and notwithstanding any other provision
of this Agreement), (i) any payment of Reimbursement Obligations with respect to
Letters of

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Credit (including through sharing of payments pursuant to Section 11.2, but
excluding any payment pursuant to Section 2.4(b)) shall, if the Borrower so
directs at the time of making such payment, be applied first to amounts owed to
Lenders other than such Defaulting Lender, as if the amount owed to such
Defaulting Lender hereunder in respect of Reimbursement Obligations were zero,
and then to amounts owed to such Defaulting Lender; (ii) such Defaulting
Lender’s Applicable Percentage of the Letter of Credit Obligations shall be
excluded for purposes of calculating Unused Fees pursuant to Section 2.8(a) in
respect of each day on which such Lender is a Defaulting Lender, and such
Defaulting Lender shall not be entitled to receive any Unused Fees for any such
day and (iii) such Defaulting Lender’s Applicable Percentage shall be deemed to
be zero for purposes of calculating Letter of Credit Fees pursuant to Section
2.8(b) in respect of each day on which such Lender is a Defaulting Lender, and
such Defaulting Lender shall not be entitled to receive any Letter of Credit
Fees for any such day.  Any payment made pursuant to this Section shall be taken
into account for purposes of calculating the Unused Fee and Letter of Credit
Fee.  The provisions of this Section 2.8(e) do not limit, but are in addition
to, any other claim or right that the Borrower, the Administrative Agent, the
Letter of Credit Agent or any other Lender may have against a Defaulting Lender.

2.9Collateralization Events.

(a)The Borrower agrees that, if at any time as a result of reductions in the
Tranche A Commitment pursuant to Section 2.3 or otherwise the aggregate balance
of the Tranche A L/C Obligations exceeds the Tranche A Commitment, the Borrower
shall promptly, but in any event within five (5) Business Days, collateralize
the Tranche A L/C Obligations by depositing into a Collateral Account Eligible
Collateral with a Collateral Value equal to the product of one hundred and two
percent (102%) of the amount as may be necessary to eliminate such excess.  The
Borrower agrees that, if at any time as a result of reductions in the Tranche B
Commitment pursuant to Section 2.3 or otherwise the aggregate balance of the
Tranche B L/C Obligations exceeds the Tranche B Commitment, the Borrower shall
promptly, but in any event within five (5) Business Days, collateralize the
Tranche B L/C Obligations by depositing into a Collateral Account Eligible
Collateral with a Collateral Value equal to the product of one hundred and two
percent (102%) of the amount as may be necessary to eliminate such excess.  

(b)Notwithstanding any other provisions of this Agreement, if at any time, after
giving effect to the conversion of Pounds into Dollars as set forth in Section
2.2, the aggregate face amount of all outstanding Letters of Credit is greater
than the Aggregate Commitment (the “Conversion Differential”), then the Borrower
shall promptly, but in any event within five (5) Business Days, collateralize
the Letter of Credit Obligations by depositing into a Collateral Account
Eligible Collateral with a Collateral Value equal to the product of one hundred
and two percent (102%) of the Conversion Differential.

(c)If the A.M. Best Rating or the S&P Rating of Navigators falls below “A-” the
Borrower shall promptly, but in any event within five (5) Business Days,
collateralize the Letter of Credit Obligations by depositing into a Collateral
Account Eligible

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Collateral with a Collateral Value equal to the product of one hundred and two
percent (102%) of the Letter of Credit Obligations.

(d)If the forecast underwriting losses based on mid-points stated in the
Franchise Performance Management Quarterly Monitoring Returns for the Supported
Syndicate exceed 20% of capacity for any year supported by a Letter of Credit,
the Borrower shall promptly, but in any event within five (5) Business Days,
collateralize the Letter of Credit Obligations by depositing into a Collateral
Account Eligible Collateral with a Collateral Value equal to one hundred and two
percent (102%) of the Letter of Credit Obligations with respect to all
outstanding Letters of Credit.

(e)In the event that any net unfunded solvency deficit on any open years of
account for the Supported Syndicate (as reported in the solvency statements
prepared by Lloyd’s) (a “NFS Deficiency”) is not funded directly at Lloyd’s by
depositing cash or similar assets into the Supported Syndicate’s personal
reserves, promptly, but in any event within 10 Business Days after the Borrower
has knowledge of such deficiency, the Borrower shall collateralize the Letter of
Credit Obligations by depositing, into a Collateral Account, Eligible Collateral
with a Collateral Value equal to the one hundred and two percent (102%) of the
NFS Deficiency after giving effect to any amount funded directly at Lloyd’s as
set forth above.

(f)In the event that an Expiry Notice is given with respect to any Letter of
Credit, the Borrower shall, within five (5) Business Days after December 31 of
the last year of account supported by the such Letter of Credit pursuant to
Section 6.2, collateralize the Letter of Credit Obligation by depositing into a
Collateral Account Eligible Collateral with a Collateral Value equal to one
hundred and two percent (102%) of the such Letter of Credit.

(g) Upon the occurrence of an Event of Default, the Borrower shall promptly
deposit in a Collateral Account Eligible Collateral with a Collateral Value
equal to the product of one hundred and two percent (102%) of the aggregate
undrawn face amount of all outstanding Letters of Credit and all fees and other
amounts due or which may become due with respect thereto.

2.10Collateral Account.

(a)The Borrower shall at all times maintain Eligible Collateral in Collateral
Accounts with a Collateral Value of not less than the Required Amount.  If at
any time the Required Amount shall exceed (the amount of such excess, the
“Collateral Shortfall”) the Collateral Value for three (3) consecutive Business
Days, the Administrative Agent shall provide the Borrower notice, by telephone
or in writing, of such Collateral Shortfall and it shall be a Default unless
within three (3) Business Days of the Borrower’s receipt of such notice, no
Collateral Shortfall exists as a result of (i) a change in the Collateral Value
due to market fluctuations and/or (ii) a deposit by the Borrower of additional
Eligible Collateral in a Collateral Account.

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(b)Eligible Collateral held in a Collateral Account (other than the UK
Collateral Account) shall be invested (i) so long as no Default has occurred, at
the direction of the Borrower, provided that all such Eligible Collateral must
be reasonably acceptable to the Administrative Agent and otherwise permitted by
this Agreement, and (ii) following the occurrence and continuation of a Default,
at the direction of the Administrative Agent.  All income from such Eligible
Collateral shall be retained in a Collateral Account and added to the
Collateral.

(c)So long as no Default has occurred and is continuing, if at any time the
Obligations become due and payable hereunder, the Borrower may request that
funds in a Collateral Account be applied to the amount which is due and payable,
including with respect to any Reimbursement Obligations and the Administrative
Agent shall apply such funds (in the case of the UK Collateral Account) or
consent to such release (in the case of any other Collateral Account) provided,
in each case, after giving effect to such application the Borrower is in
compliance with Section 2.10(a); provided, however, the Administrative Agent
shall have the right, upon five (5) days’ prior notice to the Borrower, to apply
all or any part of the Eligible Collateral held in a Collateral Account for the
amount which is due and payable unless the Borrower shall object in writing and
otherwise pay the amount due and payable within such five (5) day period.  Upon
the occurrence and continuation of a Default, the Administrative Agent may apply
(without prior notice to the Borrower) all or any part of the Eligible
Collateral held in a Collateral Account pursuant to and in accordance with
Section 8.4.

(d)So long as no Default or Unmatured Default under Section 7.2 has occurred, at
any time the Collateral Value exceeds (the amount of such excess, the
“Collateral Excess”) the Required Amount, the Borrower can request to the
release of such Collateral Excess and the Administrative Agent shall release
such funds from the UK Collateral or consent to such release with respect to any
other Collateral Account; provided, however, upon the occurrence and
continuation of a Default, the Administrative Agent shall have no obligation to
release or consent to any such release and shall have sole control over any such
Collateral Excess, including the application of such amount pursuant to and in
accordance with Section 8.4.

ARTICLE III

YIELD PROTECTION; TAXES

3.1 Yield Protection.  Without prejudice to the generality of Section 3.2, if,
on or after the Amendment Effective Date, any Change affecting such Lender or
any of its Lender Affiliates

(a)subjects any Lender or any of its Lender Affiliates to any Taxes, or changes
the basis of taxation of payments (other than with respect to Excluded Taxes) to
any Lender in respect of its interest in the Letters of Credit,

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(b)imposes or increases or deems applicable any reserve, assessment, insurance
charge, special deposit or similar requirement against assets of, deposits with
or for the account of, or credit extended by, any Lender or r any of its Lender
Affiliates, or

(c)imposes any other condition the result of which is to increase the cost to
any Lender or any of its Lender Affiliates of making, funding or issuing Letters
of Credit or reduces any amount receivable by any Lender or any applicable
Lender Affiliate in connection with any Letter of Credit, or requires any Lender
or any applicable Lender Affiliate to make any payment calculated by reference
to the amount of Letters of Credit issued or participated in or interest
received by it, by an amount deemed material by such Lender,

and the result of any of the foregoing is to increase the cost to such Lender or
applicable Lender Affiliate of making or maintaining its Commitment or its
interest in the Letters of Credit or to reduce the return received by such
Lender or applicable Lender Affiliate in connection with such Commitment or
interest in Letters of Credit, then, within fifteen (15) days of demand by such
Lender, the Borrower shall pay such Lender such additional amount or amounts as
will compensate such Lender for such increased cost or reduction in amount
received.

3.2Changes in Capital Adequacy Regulations.  If any Lender determines that any
Change affecting such Lender or any of its Lender Affiliates, if any, regarding
capital or liquidity requirements, has or would have the effect of reducing the
rate of return on such Lender’s capital or on the capital of any of its Lender
Affiliates, if any, as a consequence of this Agreement, the Commitment of such
Lender or the Letters of Credit issued by such Lender, to a level below that
which such Lender or any of its Lender Affiliates could have achieved but for
such Change (taking into consideration such Lender’s policies and the policies
of its Lender Affiliates with respect to capital adequacy and liquidity), then
within fifteen (15) days of demand by such Lender, the Borrower will pay to such
Lender the amount necessary to compensate such Lender or such Lender Affiliate
for any such reduction suffered.  “Change” means the occurrence, after the date
of this Agreement, of any of the following: (a) the adoption or taking effect of
any law, rule, regulation or treaty, (b) any change in any law, rule, regulation
or treaty or in the administration, interpretation, implementation or
application thereof by any Governmental Authority or (c) the making or issuance
of any request, rule, guideline or directive (whether or not having the force of
law) by any Governmental Authority; provided that notwithstanding anything
herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer
Protection Act and all requests, rules, guidelines or directives thereunder or
issued in connection therewith, (y) the implementation or application of or
compliance with Basel III, CRR or CRD IV or any law or regulation that
implements or applies Basel III, CRD or CRD IV, and (z) requests, rules,
guidelines or directives promulgated by the Bank for International Settlements,
the Basel Committee on Banking Supervision (or any successor or similar
authority) or the United States or United Kingdom regulatory authorities, shall
in each case be deemed to be a “Change”, regardless of the date enacted,
adopted, implemented or issued.  

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3.3Taxes.  

(a)All payments by the Borrower to or for the account of any Lender, the
Administrative Agent or the Security Trustee hereunder or under any Letter of
Credit Application shall be made free and clear of and without deduction for any
and all Taxes.  If the Borrower shall be required by law to deduct any Taxes
from or in respect of any sum payable hereunder to any Lender, the
Administrative Agent or the Security Trustee, (i) the sum payable shall be
increased as necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this Section 3.3) such
Lender, the Administrative Agent or the Security Trustee (as the case may be)
receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower shall make such deductions, (iii) the
Borrower shall pay the full amount deducted to the relevant authority in
accordance with applicable law and (iv) the Borrower shall furnish to the
Administrative Agent the original copy of a receipt evidencing payment thereof
within thirty (30) days after such payment is made.

(b)In addition, the Borrower hereby agrees to pay any present or future stamp or
documentary taxes and any other excise or property taxes, charges or similar
levies which arise from any payment made hereunder or under any other Facility
Document or from the execution or delivery of, or otherwise with respect to,
this Agreement or any other Facility Document (“Other Taxes”).

(c)Without duplication of amounts paid by the Borrower under Section 3.3(a) or
(b), the Borrower hereby agrees to indemnify the Administrative Agent and each
Lender for the full amount of Taxes or Other Taxes (including, without
limitation, any Taxes or Other Taxes imposed on amounts payable under this
Section 3.3) paid by the Administrative Agent or such Lender and any liability
(including penalties, interest and expenses) arising therefrom or with respect
thereto; provided, however, that the Borrower shall not be required to indemnify
the Administrative Agent or such Lender, as the case may be, for any penalties,
interest or expenses arising therefrom or imposed with respect thereto to the
extent that such penalties, interest, or expenses are attributable to the
failure of the Administrative Agent or such Lender, as the case may be, to pay
over any amounts paid to the Administrative Agent or such Lender by the Borrower
(for Taxes or Other Taxes) to the relevant Governmental Authority within twenty
(20) days after receipt of such payment from the Borrower.  Payments due under
this indemnification shall be made within thirty (30) days of the date the
Administrative Agent or such Lender makes demand therefor pursuant to
Section 3.4.

(d)Each Lender shall severally indemnify the Administrative Agent, within ten
days after demand therefor, for (i) any Taxes or Other Taxes attributable to
such Lender (but only to the extent that the Borrower has not already
indemnified such Agent for such Taxes or Other Taxes and without limiting the
obligation of the Borrower to do so), (ii) any Taxes attributable to such
Lender’s failure to comply with the provisions of Section 12.2(a) relating to
the maintenance of a Participant Register and (iii) any Excluded Taxes
attributable to such Lender, in each case, that are payable or paid by the
Administrative Agent in connection with any Facility Document, and any
reasonable expenses arising therefrom or with respect thereto, whether or not
such Taxes were

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correctly or legally imposed or asserted by the relevant Governmental
Authority.  A certificate as to the amount of such payment or liability
delivered to any Lender by the Administrative Agent shall be conclusive absent
manifest error.  Each Lender hereby authorizes the Administrative Agent to set
off and apply any and all amounts at any time owing to such Lender under any
Facility Document or otherwise payable by the Administrative Agent to the Lender
from any other source against any amount due to the Administrative Agent under
this clause (d).

(e)Each Lender that is not incorporated under the laws of the United States of
America or a state thereof (each a “Non-U.S. Lender”) agrees that it will, not
less than ten (10) Business Days after the date of this Agreement, deliver to
each of the Borrower and the Administrative Agent such properly completed and
executed documentation prescribed by applicable law or reasonably requested by
the Borrower, certifying that such Lender is entitled to receive payments under
this Agreement without deduction or withholding of any United States federal
income taxes.  In addition, each Lender that is not a Non-U.S. Lender will, not
less than ten (10) Business Days after the date of this Agreement, deliver to
each of the Borrower and the Administrative Agent such other documentation
prescribed by law or reasonably requested by the Borrower or the Administrative
Agent as will enable the Borrower or the Administrative Agent to determine
whether or not such Lender is subject to backup withholding and information
reporting requirements. Each Lender further undertakes to deliver to each of the
Borrower and the Administrative Agent (x) renewals or additional copies of such
form (or any successor form) on or before the date that such form expires or
becomes obsolete and (y) after the occurrence of any event requiring a change in
the most recent forms so delivered by it, such additional forms or amendments
thereto as may be reasonably requested by the Borrower or the Administrative
Agent.  All forms or amendments described in the preceding sentence shall
certify that such Lender is entitled to receive payments under this Agreement
without deduction or withholding of any United States federal income taxes,
unless an event (including without limitation any change in treaty, law or
regulation) has occurred prior to the date on which any such delivery would
otherwise be required which renders all such forms inapplicable or which would
prevent such Lender from duly completing and delivering any such form or
amendment with respect to it and such Lender advises the Borrower and the
Administrative Agent that it is not capable of receiving payments without any
deduction or withholding of United States federal income tax.  

(f)Any Lender that is entitled to an exemption from or reduction of withholding
Tax with respect to payments made under any Facility Document shall deliver to
the Borrower and the Administrative Agent, at the time or times reasonably
requested by the Borrower the Administrative Agent, such properly completed and
executed documentation reasonably requested by the Borrower the Administrative
Agent as will permit such payments to be made without withholding or at a
reduced rate of withholding.  In addition, any Lender, if reasonably requested
by the Borrower or the Administrative Agent, shall deliver such other
documentation prescribed by Applicable Law or reasonably requested by the
Borrower or the Administrative Agent as will enable the Borrower or the
Administrative Agent to determine whether or not such Lender is subject to
backup withholding or information reporting requirements.  Notwithstanding

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anything to the contrary in the preceding two sentences, the completion,
execution and submission of such documentation (other than such documentation
set forth in Sections 3.3(e) and 3.3(g)) shall not be required if, in the
Lender’s reasonable judgment, such completion, execution or submission would
subject such Lender to any material unreimbursed cost or expense or would
materially prejudice the legal or commercial position of such Lender.

(g)Thereafter:

(i)Subject to paragraph (iii) below, each Party shall, within ten Business Days
of a reasonable request by another Party confirm to that other Party whether it
is or is not a FATCA Exempt Party and supply to that other Party such forms,
documentation and other information relating to its status under FATCA
(including its applicable passthru percentage or other information required
under the Treasury Regulations or other official guidance including
intergovernmental agreements) as that other Party reasonably requests for the
purposes of that other Party's compliance with FATCA;  provided that no Party
shall be obliged to do anything which would or might in its reasonable opinion
constitute a breach of any law or regulation, any policy of such Party, any
fiduciary duty or any duty of confidentiality.

(ii)If a Party confirms to another Party pursuant to Section 3.3(g)(i) above
that it is a FATCA Exempt Party and it subsequently becomes aware that it is
not, or has ceased to be a FATCA Exempt Party, that Party shall notify that
other Party reasonably promptly.

(iii)If a Party fails to confirm its status or to supply forms, documentation or
other information requested in accordance with paragraph (a) above (including,
for the avoidance of doubt, where a Party determines that providing the other
Party with any of the information requested under Section 3.3(g)(i) will or may
in its reasonable opinion constitute a breach of any law or regulation, any
policy of such Party, any fiduciary duty or any duty of confidentiality), then
(x) if that Party failed to confirm whether it is (and/or remains) a FATCA
Exempt Party then such Party shall be treated for the purposes of the Facility
Documents as if it is not a FATCA Exempt Party and (y)  if that Party failed to
confirm its applicable passthru percentage then such Party shall be treated for
the purposes of the Facility Documents (and payments made thereunder) as if its
applicable passthru percentage is 100%,  until (in each case) such time as the
Party in question provides the requested confirmation, forms, documentation or
other information.  

(h)For any period during which a Non-U.S. Lender has failed to provide the
Borrower with an appropriate form pursuant to paragraph (e) above (unless such
failure is due to a change in treaty, law or regulation, or any change in the
interpretation or administration thereof by any Governmental Authority,
occurring subsequent to the date on which a form originally was required to be
provided), such Non-U.S. Lender shall not be entitled to indemnification under
this Section 3.3 with respect to Taxes imposed by the

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United States; provided that, should a Non-U.S. Lender which is otherwise exempt
from or subject to a reduced rate of withholding tax become subject to Taxes
because of its failure to deliver a form required under paragraph (e) above, the
Borrower shall take such steps as such Non-U.S. Lender shall reasonably request
to assist such Non-U.S. Lender to recover such Taxes.

(i)If the U.S. Internal Revenue Service or any other Governmental Authority of
the United States or any other country or any political subdivision thereof
asserts a claim that the Administrative Agent did not properly withhold tax from
amounts paid to or for the account of any Lender (because the appropriate form
was not delivered or properly completed, because such Lender failed to notify
the Administrative Agent of a change in circumstances which rendered its
exemption from withholding ineffective, or for any other reason), such Lender
shall indemnify the Administrative Agent fully for all amounts paid, directly or
indirectly, by the Administrative Agent as tax, withholding therefor, or
otherwise, including penalties and interest, and including taxes imposed by any
jurisdiction on amounts payable to the Administrative Agent under this
subsection, together with all costs and expenses related thereto (including
attorneys fees and time charges of attorneys for the Administrative Agent, which
attorneys may be employees of the Administrative Agent).  The obligations of the
Lenders under this Section 3.3(g) shall survive the payment of the Obligations
and termination of this Agreement.

(j)If the Administrative Agent or any Lender receives a refund of any Taxes or
Other Taxes as to which it has been indemnified by the Borrower, it shall pay to
the Borrower an amount equal to such refund (but only to the extent of indemnity
payments made, or additional amounts paid, by the Borrower under this Section
3.3 with respect to Taxes or Other Taxes giving rise to such refund), net of all
reasonable out-of-pocket expenses incurred by the Administrative Agent or the
Lender, as the case may be, and without interest (other than any interest paid
by the relevant Governmental Authority with respect to such refund), provided
that the Borrower, upon the request of the Administrative Agent or the Lender
agrees to repay the amount paid over to the Borrower (plus any penalties,
interest or other charges imposed by the relevant Governmental Authority) to the
Administrative Agent or the Lender in the event the Administrative Agent or the
Lender is required to repay such refund to such Governmental Authority.

3.4Lender Statements; Survival of Indemnity.  To the extent reasonably possible,
each Lender shall designate an alternate Lending Installation to reduce any
liability of the Borrower to such Lender under Sections 3.1, 3.2 and 3.3 so long
as such designation is not, in the judgment of such Lender, disadvantageous to
such Lender.  Each Lender shall deliver a written statement of such Lender to
the Borrower (with a copy to the Administrative Agent) as to the amount due, if
any, under Section 3.1, 3.2 or 3.3.  Such written statement shall set forth in
reasonable detail the calculations upon which such Lender determined such amount
and shall be final, conclusive and binding on the Borrower in the absence of
manifest error.  The obligations of the Borrower under Section 3.1, 3.2 and 3.3
shall survive payment of the Obligations and termination of this Agreement.

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ARTICLE IV

CONDITIONS PRECEDENT

4.1The Lenders Obligation to Issue. The obligation of the Letter of Credit Agent
and each Lender to issue the initial Letter of Credit hereunder is subject to
satisfaction of the following conditions precedent:

(a)The Administrative Agent’s receipt of the following, each of which shall be
originals or facsimiles or sent by electronic mail (followed promptly by
originals) unless otherwise specified, each properly executed by an Authorized
Officer of the Borrower, each dated the Amendment Effective Date (or, in the
case of certificates of governmental officials, a recent date before the
Amendment Effective Date) and each in form and substance satisfactory to the
Administrative Agent and its counsel:

(i)Charter Documents; Good Standing Certificates.  Copies of the articles or
certificate of incorporation of the Borrower, together with all amendments, and
a certificate of good standing, each certified by the appropriate governmental
officer in its jurisdiction of incorporation.

(ii)By-Laws and Resolutions.  Copies, certified by the Secretary or Assistant
Secretary of the Borrower, of its by‑laws and of its Board of Directors’
resolutions and of resolutions or actions of any other body authorizing the
execution of the Facility Documents to which the Borrower is a party.

(iii)Secretary’s Certificate.  An incumbency certificate, executed by the
Secretary or Assistant Secretary of the Borrower, which shall identify by name
and title and bear the signature of the officers of the Borrower authorized to
sign the Facility Documents, upon which certificate the Administrative Agent and
the Lenders shall be entitled to rely until informed of any change in writing by
the Borrower.

(iv)Officer’s Certificate.  A certificate, signed by an Authorized Officer of
the Borrower, stating that:  (A) on the Amendment Effective Date no Default or
Unmatured Default has occurred and is continuing, (B) each of the
representations and warranties set forth in Article V of this Agreement is true
and correct on and as of the Amendment Effective Date (provided, that solely for
purposes of this Section 4.1(a)(iv)(B), the representation and warranty in
Section 5.6 shall be deemed to contain a reference to “prospects” of the
Borrower) and (C) the A.M. Best Rating and the S&P Rating for Navigators.

(v)Legal Opinion.  A written opinion of Drinker Biddle & Reath LLP, New York
counsel to the Borrower regarding US matters addressed to the Administrative
Agent and the Lenders and in form and substance acceptable to the Administrative
Agent and its counsel.

(vi)Facility Documents.  Executed originals of this Agreement.

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(vii)Financial Statements.  The financial statements described in Section 6.1(b)
and the statutory statements described in Section 6.1(e), in each case for the
fiscal quarter ending June 30, 2016.

(viii)RDS.  A summary of the RDS calculations (including the information
necessary to calculate the covenants in Section 6.23(f)) for the Supported
Syndicate prepared in accordance with the definitions and reporting requirements
of Lloyd’s as in effect on the Amendment Effective Date for the applicable
account years to be covered by the Letters of Credit to be issued hereunder.

(ix)Lloyd’s Letters.  The Lloyd’s Comfort Letter duly executed by Lloyds and a
substitution letter in form and substance satisfactory to the Letter of Credit
Agent in respect of cancellation of the existing letter of credit issued under
ING Bilateral Facility upon receipt of the new or amended Letters of Credit
issued under this Agreement.

(x)Confirmation of Primary FAL.  The Confirmation of Primary FAL duly executed
by a director of the Managing Agent.

(xi)Compliance Certificate.  A Compliance Certificate duly completed and
executed based on the June 30, 2016 financial statements and the 2016 Year of
Account.

(xii)Know your Customer.  All documentation and other information required by
bank regulatory authorities under applicable “know your customer” and anti-money
laundering rules and regulations, including the PATRIOT Act.

(xiii)Other.  Such other documents as the Administrative Agent, any Lender or
their counsel may have reasonably requested.

(b)The A.M. Best Rating and the S&P Rating for Navigators shall be not less than
“A-”.

(c)All fees due under the Fee Letter shall have been paid to the Administrative
Agent.

(d)Unless waived by the Administrative Agent, the Borrower shall have paid all
fees, charges and disbursements of counsel to the Administrative Agent (directly
to such counsel if requested by the Administrative Agent) to the extent invoiced
prior to or on the Amendment Effective Date, plus such additional amounts of
such fees, charges and disbursements as shall constitute its reasonable estimate
of such fees, charges and disbursements incurred or to be incurred by it through
the closing proceedings (provided that such estimate shall not thereafter
preclude a final settling of accounts between Borrower and the Administrative
Agent).

Without limiting the generality of Section 10.4, for purposes of determining
compliance with the conditions specified in this Section 4.1, each Lender that
has signed this Agreement shall be

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deemed to have consented to, approved or accepted or to be satisfied with, each
document or other matter required thereunder to be consented to or approved by
or acceptable or satisfactory to a Lender unless the Administrative Agent shall
have received notice from such Lender prior to the proposed Amendment Effective
Date specifying its objection thereto.

4.2Each Letter of Credit.  The Letter of Credit Agent, on behalf of the Lenders,
shall not be obligated to issue or increase the stated amount of any Letter of
Credit, unless on the applicable Issue Date:

(a)There exists no Default or Unmatured Default and none would result from such
issuance of such Letter of Credit.

(b)The representations and warranties contained in Article V are true and
correct as of such Issue Date except to the extent any such representation or
warranty is stated to relate solely to an earlier date, in which case such
representation or warranty shall have been true and correct on and as of such
earlier date.

(c)An Issuance Request, as applicable, shall have been properly submitted.

(d)All legal matters incident to the issuance of such Letter of Credit shall be
satisfactory to the Lenders and their counsel.

(e)If a Collateralization Event has occurred, the Required Amount shall have
been deposited as required under Section 2.9 and the Administrative Agent shall
have received a Borrowing Base Certificate calculated as of the most recent
Business Day in accordance with the requirements hereof and demonstrating
compliance with Section 2.10 after giving effect to the issuance of the
requested Letter of Credit.

(f)Each Issuance Request with respect to each such Letter of Credit shall
constitute a representation and warranty by the Borrower that the conditions
contained in Section 4.2(a) and (b) have been satisfied.  Any Lender may require
a duly completed Compliance Certificate as a condition to issuing a Letter of
Credit.

ARTICLE V

REPRESENTATIONS AND WARRANTIES

The Borrower represents and warrants to the Lenders that:

5.1Existence and Standing .  Each of the Borrower and its Subsidiaries is duly
and properly formed, validly existing and in good standing under the laws of its
jurisdiction of incorporation or organization and, except as could not
reasonably be expected to have a Material Adverse Effect, has all requisite
authority to conduct its business in each jurisdiction in which its business is
conducted.

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5.2Authorization and Validity.  The Borrower has the corporate power and
authority and legal right to execute and deliver the Facility Documents and to
perform its obligations thereunder.  The execution and delivery by the Borrower
of the Facility Documents and the performance of its obligations thereunder have
been duly authorized by proper corporate proceedings, and the Facility Documents
to which the Borrower is a party constitute legal, valid and binding obligations
of the Borrower enforceable against the Borrower in accordance with their terms,
except as enforceability may be limited by bankruptcy, insolvency or similar
laws affecting the enforcement of creditors’ rights generally.

5.3No Conflict; Government Consent.  Neither the execution and delivery by the
Borrower of the Facility Documents, nor the consummation of the transactions
therein contemplated, nor compliance with the provisions thereof will violate
(a) any law, rule, regulation, order, writ, judgment, injunction, decree or
award binding on the Borrower or any of its Subsidiaries or (b) the Borrower’s
or any Subsidiary’s articles or certificate of incorporation, partnership
agreement, certificate of partnership, articles or certificate of organization,
by‑laws, or operating or other management agreement, as the case may be, or (c)
the provisions of any indenture, instrument or agreement to which the Borrower
or any of its Subsidiaries is a party or is subject, or by which it, or its
Property, is bound, or conflict with or constitute a default thereunder, or
result in, or require, the creation or imposition of any Lien in, of or on the
Property of the Borrower or a Subsidiary pursuant to the terms of any such
indenture, instrument or agreement.  No order, consent, adjudication, approval,
license, authorization, or validation of, or filing, recording or registration
with, or exemption by, or other action in respect of any governmental or public
body or authority, or any subdivision thereof, which has not been obtained by
the Borrower or any of its Subsidiaries, is required to be obtained by the
Borrower or any of its Subsidiaries in connection with the execution and
delivery of the Facility Documents, the extensions of credit under this
Agreement, the payment and performance by the Borrower of the Obligations or the
legality, validity, binding effect or enforceability of any of the Facility
Documents, except that approval of the New York Insurance Department and/or one
or more other state insurance departments would be required in order for the
Lenders to acquire control of Navigators and NSIC.  Neither the Borrower nor any
Subsidiary is in default under or in violation of any foreign, federal, state or
local law, rule, regulation, order, writ, judgment, injunction, decree or award
binding upon or applicable to the Borrower or such Subsidiary, in each case the
consequences of which default or violation could reasonably be expected to have
a Material Adverse Effect.

5.4Financial Statements. (a) (i)  The consolidated balance sheets of the
Borrower and the Consolidated Subsidiaries as of December 31, 2015, the related
consolidated statements of income, consolidated statements of stockholders’
equity, and consolidated statements of cash flows of the Borrower and such
Consolidated Subsidiaries for the Fiscal Year then ended, and the accompanying
footnotes, together, with the opinion thereon, of KPMG LLP, independent
certified public accountants, copies of which have been furnished to the
Lenders, fairly present the financial condition of the Borrower and the
Consolidated Subsidiaries as at such dates and the results of the operations of
the Borrower and Consolidated Subsidiaries for the periods covered by such
statements, all in accordance with Agreement Accounting Principles consistently
applied and (ii) the unaudited consolidated balance sheets of the Borrower and
the Consolidated Subsidiaries as of June 30, 2016, the related consolidated
statements of income, consolidated statements of stockholders’ equity, and
consolidated statements of cash flows of the

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Borrower and such Consolidated Subsidiaries for the fiscal quarter then
ended,  fairly present the financial condition of the Borrower and the
Consolidated Subsidiaries as at such dates and the results of the operations of
the Borrower and Consolidated Subsidiaries for the periods covered by such
statements, all in accordance with Agreement Accounting Principles consistently
applied (subject to year-end adjustments and the absence of footnotes).

(b)There are no liabilities of the Borrower or any of the Consolidated
Subsidiaries, fixed or contingent, which are material but are not reflected in
the most recent financial statements referred to above or in the notes thereto,
other than liabilities arising in the ordinary course of business since December
31, 2015.

5.5Statutory Financial Statements. The Annual Statement of each of the Insurance
Subsidiaries (including, without limitation, the provisions made therein for
investments and the valuation thereof, reserves, policy and contract claims and
statutory liabilities) as filed with the appropriate Governmental Authority of
its state of domicile (the “Department”) as of and for the 2015 Fiscal Year  and
the quarterly SAP statements for the fiscal quarter ended June 30, 2016
delivered to each Lender prior to the execution and delivery of this Agreement
(collectively, the “Statutory Financial Statements”), have been prepared in
accordance with SAP applied on a consistent basis (except as noted
therein).  Each such Statutory Financial Statement was in material compliance
with applicable law when filed.

5.6Material Adverse Change.  Other than as disclosed in any SEC Report filed
prior to November 4, 2016, since December 31, 2015 there has been no change in
the business, Property, condition (financial or otherwise), prospects or results
of operations of the Borrower and its Subsidiaries which could reasonably be
expected to have a Material Adverse Effect.

5.7Taxes.  The Borrower and its Subsidiaries have filed all United States
federal tax returns and all other tax returns which are required to be filed and
have paid all taxes due pursuant to said returns or pursuant to any assessment
received by the Borrower or any of its Subsidiaries, except such taxes, if any,
as are being contested in good faith and as to which adequate reserves have been
provided in accordance with Agreement Accounting Principles and as to which no
Lien exists.  No tax liens have been filed and no claims are being asserted with
respect to any such taxes.  The charges, accruals and reserves on the books of
the Borrower and its Subsidiaries in respect of any taxes or other governmental
charges are adequate.

5.8Litigation and Contingent Obligations.  There is no litigation, arbitration,
governmental investigation, proceeding or inquiry pending or, to the knowledge
of any of their officers, threatened against or affecting the Borrower or any of
its Subsidiaries which could reasonably be expected to have a Material Adverse
Effect or which seeks to prevent, enjoin or delay the issuance of any Letter of
Credit.  Other than any liability incident to any litigation, arbitration or
proceeding which could not reasonably be expected to have a Material Adverse
Effect, the Borrower has no material contingent obligations not provided for or
disclosed in the SEC Reports or in the financial statements referred to in
Section 5.4.

5.9Subsidiaries.  Schedule 5.9 contains an accurate list of all Subsidiaries of
the Borrower as of the date of this Agreement, setting forth their respective
jurisdictions of organization and the percentage of their respective capital
stock or other ownership interests

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owned by the Borrower or other Subsidiaries and indicating which Subsidiaries
are Significant Subsidiaries and which Subsidiaries are Insurance
Subsidiaries.  All of the issued and outstanding shares of capital stock or
other ownership interests of such Subsidiaries have been (to the extent such
concepts are relevant with respect to such ownership interests) duly authorized
and issued and are fully paid and non‑assessable.

5.10ERISA.  The Unfunded Liabilities of all Single Employer Plans is $0 except
that funding of any money purchase pension plan may be delayed each Fiscal Year
until the end of the first Fiscal Quarter of the following year.  Neither the
Borrower nor any other member of the Controlled Group has incurred, or is
reasonably expected to incur, any withdrawal liability to any Multiemployer
Plan.  Each Plan complies in all material respects with all applicable
requirements of law and regulations, no Reportable Event has occurred with
respect to any Plan, neither the Borrower nor any other member of the Controlled
Group has withdrawn from any Plan or initiated steps to do so, and no steps have
been taken to reorganize or terminate any Plan.  There are no pending or, to the
best knowledge of the Borrower, threatened claims, actions or lawsuits, or
action by any Government Authority, with respect to any Plan that could
reasonably be expected to have a Material Adverse Effect.

5.11Defaults.  No Default or Unmatured Default has occurred and is continuing.

5.12Accuracy of Information.  No information, exhibit or report furnished by the
Borrower or any of its Subsidiaries to the Administrative Agent or to any Lender
in connection with the negotiation of, or compliance with, the Facility
Documents contained any material misstatement of fact or omitted to state a
material fact or any fact necessary to make the statements contained therein not
misleading.

5.13Regulation U.  Margin Stock (as defined in Regulation U) constitutes less
than 25% of the value of those assets of the Borrower and its Subsidiaries which
are subject to any limitation on sale, pledge, or other restriction
hereunder.  Neither the issuance of any Letters of Credit hereunder nor the use
of the proceeds thereof, will violate or be inconsistent with the provisions of
Regulation T, Regulation U or Regulation X.

5.14Material Agreements.  Neither the Borrower nor any Subsidiary is a party to
any agreement or instrument or subject to any charter or other corporate
restriction which could reasonably be expected to have a Material Adverse
Effect.  Neither the Borrower nor any Subsidiary is in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in (a) any agreement to which it is a party which default
could reasonably be expected to have a Material Adverse Effect or (b) any
agreement or instrument evidencing or governing Indebtedness.

5.15Compliance With Laws.  The Borrower and its Subsidiaries have complied with
all applicable statutes, rules, regulations, orders and restrictions of any
domestic or foreign government or any instrumentality or agency thereof having
jurisdiction over the conduct of their respective businesses or the ownership of
their respective Property, except where the failure to comply could not
reasonably be expected to have a Material Adverse Effect.

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5.16Ownership of Properties.  The Borrower and each of its Subsidiaries has good
title, free of all Liens other than those permitted by Section 6.16, to all of
the Property and assets reflected in the Borrower’s most recent consolidated
financial statements filed with the Securities and Exchange Commission as owned
by the Borrower and its Subsidiaries.

5.17Plan Assets; Prohibited Transactions.  The Borrower is not an entity deemed
to hold “plan assets” within the meaning of 29 C.F.R. § 2510.3-101 of an
employee benefit plan (as defined in Section 3(3) of ERISA) which is subject to
Title I of ERISA or any plan (within the meaning of Section 4975 of the Code),
and neither the execution of this Agreement nor the issuance of Letters of
Credit hereunder gives rise to a prohibited transaction within the meaning of
Section 406 of ERISA or Section 4975 of the Code.

5.18Environmental Matters.  In the ordinary course of its business, the officers
of the Borrower consider the effect of Environmental Laws on the business of the
Borrower and its Subsidiaries, in the course of which they identify and evaluate
potential risks and liabilities accruing to the Borrower due to Environmental
Laws.  On the basis of this consideration, the Borrower has concluded that
Environmental Laws cannot reasonably be expected to have a Material Adverse
Effect.  Neither the Borrower nor any Subsidiary has received any notice to the
effect that its operations are not in material compliance with any of the
requirements of applicable Environmental Laws or are the subject of any federal
or state investigation evaluating whether any remedial action is needed to
respond to a release of any toxic or hazardous waste or substance into the
environment, which non‑compliance or remedial action could reasonably be
expected to have a Material Adverse Effect.

5.19Investment Company Act.  Neither the Borrower nor any Subsidiary is an
“investment company” or a company “controlled” by an “investment company”,
within the meaning of the Investment Company Act of 1940, as amended.

5.20Solvency.  Immediately after the consummation of the transactions to occur
on the date hereof and immediately following each issuance of a Letter of Credit
(including the Existing Letters of Credit) hereunder on the date hereof and
after giving effect to the application of the proceeds of such Letters of
Credit, (a) the fair value of the assets of the Borrower and its Subsidiaries on
a consolidated basis, at a fair valuation, will exceed the debts and
liabilities, subordinated, contingent or otherwise, of the Borrower and its
Subsidiaries on a consolidated basis, (b) the present fair saleable value of the
Property of the Borrower and its Subsidiaries on a consolidated basis will be
greater than the amount that will be required to pay the probable liability of
the Borrower and its Subsidiaries on a consolidated basis on their debts and
other liabilities, subordinated, contingent or otherwise, as such debts and
other liabilities become absolute and matured, (c) the Borrower and its
Subsidiaries on a consolidated basis will be able to pay their debts and
liabilities, subordinated, contingent or otherwise, as such debts and
liabilities become absolute and matured and (d) the Borrower and its
Subsidiaries on a consolidated basis will not have unreasonably small capital
with which to conduct the businesses in which they are engaged as such
businesses are now conducted and are proposed to be conducted after the date
hereof.

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5.21Insurance Licenses.  To the extent required by applicable law, each
Insurance Subsidiary holds a License and is authorized to transact insurance
business in (i) the line or lines of insurance and (ii) the state, states or
jurisdictions it is engaged in, except to the extent that the failure to have
such a License or authority could not reasonably be expected to have a Material
Adverse Effect.  No such License, the loss of which could reasonably be expected
to have a Material Adverse Effect, is the subject of a proceeding for
suspension, limitation or revocation.  To the Borrower’s knowledge, there is not
a sustainable basis for such suspension, limitation or revocation, and no such
suspension, limitation or revocation has been threatened by any Governmental
Authority.  The Insurance Subsidiaries do not transact any business, directly or
indirectly, requiring any license, permit, governmental approval, consent or
other authorization other than those currently obtained, except to the extent of
which could not reasonably be expected to have a Material Adverse Effect.

5.22Partnerships.  Except as disclosed in Schedule 5.22, neither the Borrower
nor any of its Subsidiaries is a partner of any partnership.

5.23Lines of Business.  Schedule 5.23 sets forth a complete statement of each
material line of business conducted as of the date hereof by the Borrower and
each of its Subsidiaries (the “Existing Lines of Business”).

5.24Reinsurance Practices. The business of each Insurance Subsidiary is being
conducted in all material respects in accordance with the Reinsurance
Guidelines.

5.25Security. Each Security Document is effective to create and give the
Administrative Agent, for the benefit of the Secured Parties, as security for
the repayment of the obligations secured thereby, a legal, valid, perfected and
enforceable first priority Lien upon and security interest in the Collateral in
which a security interest is granted thereby except for the Permitted Liens (as
defined in the Security Agreement) and except that approval of the New York
Insurance Department and/or one or more other state insurance departments would
be required in order for the Lenders to acquire control of Navigators or NSIC.

5.26Disclosure.  None of the (a) information, exhibits or reports furnished or
to be furnished by the Borrower or any Subsidiary to the Administrative Agent or
to any Lender in connection with the negotiation of the Facility Documents or
(b) representations or warranties of the Borrower or any Subsidiary contained in
this Agreement, the other Facility Documents or any other document, certificate
or written statement furnished to the Administrative Agent or the Lenders by or
on behalf of the Borrower or any Subsidiary for use in connection with the
transactions contemplated by this Agreement or the Facility Documents contained,
contains or will contain any untrue statement of a material fact or omitted,
omits or will omit to state a material fact necessary in order to make the
statements contained herein or therein not misleading in light of the
circumstances in which the same were made.  There is no fact known to the
Borrower (other than matters of a general economic nature) that has had or could
reasonably be expected to have a Material Adverse Effect and that has not been
disclosed herein or in such other documents, certificates and statements
furnished to the Lenders for use in connection with the transactions
contemplated by this Agreement.

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5.27Anti-Money Laundering and Anti-Terrorism Finance Laws.  To the extent
applicable, the Borrower is in compliance, in all material respects, with
anti-money laundering laws and anti-terrorism finance laws of any jurisdiction
applicable to the Borrower or its Subsidiaries, including the Bank Secrecy Act
and the PATRIOT Act (the “Anti-Terrorism Laws”).

5.28Anti-Corruption Laws.  No Letter of Credit shall be requested and no part of
the proceeds of the Letters of Credit shall be used, directly or, to the
knowledge of the Borrower, indirectly: (a) to offer or give anything of value to
any official or employee of any foreign government department or agency or
instrumentality or government-owned entity, to any foreign political party or
party official or political candidate or to any official or employee of a public
international organization, or to anyone else acting in an official capacity
(collectively, “Foreign Official”), in order to obtain, retain or direct
business by (i) influencing any act or decision of such Foreign Official in his
official capacity, (ii) inducing such Foreign Official to do or omit to do any
act in violation of the lawful duty of such Foreign Official, (iii) securing any
improper advantage or (iv) inducing such Foreign Official to use his influence
with a foreign government or instrumentality to affect or influence any act or
decision of such government or instrumentality; (b) to cause any Lender to
violate the U.S. Foreign Corrupt Practices Act of 1977; or (c) to cause any
Lender to violate any other anti-corruption law applicable to such Lender (all
laws referred to in clauses (b) and (c) being “Anti-Corruption Laws”).

5.29Sanctions Laws.  Neither the Borrower nor its Subsidiaries and to the
knowledge of the Borrower, no other Affiliate or broker or other agent of the
Borrower acting or benefiting in any capacity in connection with the Letters of
Credit, is any of the following (a “Restricted Person”): (a) a Person that is
listed in the annex to, or is otherwise subject to the provisions of, Executive
Order No. 13224 on Terrorist Financing, effective September 24, 2001 (the
“Executive Order”); (b) a Person that is named as a “specially designated
national and blocked person” on the most current list published by the U.S.
Treasury Department Office of Foreign Assets Control (“OFAC”) at its official
website or any replacement website or other replacement official publication of
such list or similarly named by any similar foreign governmental authority; (c)
a Person that is owned 50 percent or more by any Person described in Section
5.29(b); (d) any other Person with which any Lender is prohibited from dealing
under any Sanctions laws; or (e) a Person that derives more than 10% of its
annual revenue from investments in or transactions with any Person described in
Section 5.29 (a), (b), (c) or (d).  Further, no Letter of Credit shall be
requested, and none of the proceeds from the Letters of Credit shall be used to
finance or facilitate, directly or, to the Borrower’s or any Subsidiaries’
knowledge, indirectly, any transaction with, investment in, or any dealing for
the benefit of, any Restricted Person or any transaction, investment or dealing
in which the benefit is received in a country for which such benefit is
prohibited by any Sanctions laws.  The Borrower will maintain in effect and
enforce policies and procedures designed to ensure compliance by the Borrower,
its Subsidiaries and their respective directors, officers, employees and agents
with Anti-Corruption Laws and applicable Sanctions.

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ARTICLE VI

COVENANTS

Until the date that no Letters of Credit are outstanding and all Letter of
Credit Obligations have been indefeasibly paid in full, unless the Lenders shall
otherwise consent in writing:

6.1Financial Reporting.  The Borrower will maintain, for itself and each
Subsidiary, a system of accounting established and administered in accordance
with generally accepted accounting principles, consistently applied, and will
furnish to the Lenders:

(a)As soon as practicable and in any event within seventy (70) days after the
close of each of its Fiscal Years, an unqualified audit report certified by
independent certified public accountants acceptable to the Required Lenders,
prepared in accordance with Agreement Accounting Principles on a consolidated
and consolidating basis and setting forth in comparative form figures for the
preceding Fiscal Year for itself and its Consolidated Subsidiaries and on a
stand alone basis for the Borrower, including balance sheets as of the end of
such period and related statements of income, stockholders’ equity and cash
flows accompanied by any management letter prepared by said accountants;
provided that no annual report other than the report on Form 10-K needs to be
delivered.

(b)As soon as practicable and in any event within fifty (50) days after the
close of the first three Fiscal Quarters of each of its Fiscal Years, for itself
and its Subsidiaries, consolidated and consolidating unaudited balance sheets as
at the close of each such period and consolidated and consolidating statement of
income, stockholders’ equity and cash flows for the period from the beginning of
such Fiscal Year to the end of such quarter setting forth in each case in
comparative form figures for the corresponding period in the prior Fiscal Year,
all prepared in accordance with Agreement Accounting Principles and in
reasonable detail, and all signed by its chief financial officer.

(c)As soon as available and in any event (i) within seventy (70) days after the
close of each Fiscal Year of each Insurance Subsidiary, the Annual Statement of
such Insurance Subsidiary for such Fiscal Year as filed with the insurance
commissioner (or similar authority) in such Insurance Subsidiary’s state of
domicile, together with the signature thereof of the chief financial officer of
the Borrower stating that such Annual Statement presents the financial condition
and results of operations of such Insurance Subsidiary in accordance with SAP,
(ii) on or prior to each June 1 after the close of each Fiscal Year of each
Insurance Subsidiary, the opinion of a firm of certified public accountants
reasonably satisfactory to the Required Lenders, who shall have examined such
Annual Statement and whose opinion shall not be qualified as to the scope of
audit or as to the status of such Insurance Subsidiary as a going concern, and
(iii) within one hundred twenty (120) days after the close of each Fiscal Year
of each Insurance Subsidiary, a written review of and opinion of an accounting
or actuarial firm or internal actuary, as delivered to the Department,
reasonably satisfactory to the Required Lenders on the methodology and
assumptions used to calculate the Loss Reserves of such

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Insurance Subsidiary at the end of such Fiscal Year (as shown on the Annual
Statement of such Insurance Subsidiary prepared in accordance with SAP).  

(d)As soon as available and in any event on or prior to each May 1 after the
close of each Fiscal Year of the Insurance Subsidiaries, the Consolidated Annual
Statement of the Insurance Subsidiaries for such Fiscal Year, prepared in
accordance with SAP and filed with the New York Insurance Department.  

(e)As soon as available and in any event within fifty (50) days after the close
of each of the first three Fiscal Quarters in each Fiscal Year of each Insurance
Subsidiary, quarterly financial statements of such Insurance Subsidiary
(prepared in accordance with SAP) for such Fiscal Quarter and as filed with the
insurance commissioner (or similar authority) in such Insurance Subsidiary’s
state of domicile, together with the signature thereon of the chief financial
officer of the Borrower stating that such financial statements present the
financial condition and results of operations of such Insurance Subsidiary in
accordance with SAP.

(f)As soon as practicable and in any event within ninety (90) days after the
close of each Fiscal Year of the Supported Syndicate, an unqualified audit
report certified by independent certified public accountants acceptable to the
Required Lenders, prepared in accordance with Agreement Accounting Principles
setting forth in comparative form figures for the preceding Fiscal Year for the
Supported Syndicate, including balance sheets as of the end of such period and
related statements of income and stockholders’ equity accompanied by any
management letter prepared by said accountants.  

(g)As soon as practicable and in any event within one hundred and eighty (180)
days after the close of each Fiscal Year of the Corporate Member, an unqualified
audit report certified by independent certified public accountants acceptable to
the Required Lenders, prepared in accordance with Agreement Accounting
Principles setting forth in comparative form figures for the preceding Fiscal
Year for the Corporate Member, including balance sheets as of the end of such
period and related statements of income and stockholders’ equity accompanied by
any management letter prepared by said accountants.

(h)As soon as available, but in any event within one hundred twenty (120) days
after the beginning of each Fiscal Year, a copy of the plan and forecast of the
Borrower and its Subsidiaries for such Fiscal Year in the form customarily
prepared by the Borrower.

(i)Together with the financial statements required by clauses (b) and (c) above,
a Compliance Certificate signed by its chief financial officer showing the
calculations necessary to determine compliance with this Agreement and stating
that no Default or Unmatured Default exists, or if any Default or Unmatured
Default exists, stating the nature and status thereof and updating Schedule 5.9.

(j)As soon as possible and in any event within ten (10) days after the Borrower
knows that any Termination Event has occurred with respect to any Plan, a

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statement, signed by the chief financial officer of the Borrower, describing
said Termination Event and the action which the Borrower proposes to take with
respect thereto.  

(k)As soon as possible and in any event within ten (10) days after receipt by
the Borrower, a copy of (i) any notice or claim to the effect that the Borrower
or any of its Subsidiaries is or may be liable to any Person as a result of the
release by the Borrower, any of its Subsidiaries or any other Person of any
toxic or hazardous waste or substance into the environment, and (ii) any notice
alleging any violation of any federal, state or local environmental, health or
safety law or regulation by the Borrower or any of its Subsidiaries.  

(l)As soon as possible and in any event within ten (10) days after the Borrower
learns thereof, notice of the assertion or commencement of any claims, action,
suit or proceeding against or affecting the Borrower or any Subsidiary which may
reasonably be expected to have a Material Adverse Effect.

(m)Promptly upon the furnishing thereof to the shareholders of the Borrower,
copies of all financial statements, reports and proxy statements so furnished;
provided that no annual report other than the report on Form 10-K needs to be
delivered.

(n)Promptly upon the filing thereof, copies of all registration statements and
annual, quarterly, monthly or other regular reports which the Borrower or any of
its Subsidiaries files with the Securities and Exchange Commission.

(o)Promptly and in any event within ten (10) days after learning thereof,
notification of (i) any tax assessment, demand, notice of proposed deficiency or
notice of deficiency received by the Borrower or any Consolidated Person or (ii)
the filing of any tax Lien or commencement of any judicial proceeding by or
against any such Consolidated Person, if any such assessment, demand, notice,
Lien or judicial proceeding relates to tax liabilities in excess of
$2,500,000.  

(p)Promptly, and in any event within five (5) days after (i) learning thereof,
notification of any changes after the date hereof in the Borrower’s S&P Rating
or Borrower’s Moody’s Rating or in the A.M. Best Rating in respect of any
Insurance Subsidiary and (ii) receipt thereof, copies of any ratings analysis by
A.M. Best & Co. relating to any Insurance Subsidiary.

(q)Copies of any actuarial certificates prepared with respect to any Insurance
Subsidiary, promptly after the receipt thereof, and not later than ninety (90)
days after each Fiscal Year, an actuarial opinion with respect to each Insurance
Subsidiary in form and substance reasonably satisfactory to the Administrative
Agent and the Required Lenders from an accounting or actuarial firm or internal
actuary, as delivered to the Department, reasonably satisfactory to the
Administrative Agent and the Required Lenders.

(r)Promptly upon the filing thereof, copies of all filings and annual,
quarterly, monthly or other regular reports which the Borrower or any of its
Subsidiaries

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files with the NAIC or any insurance commission or department or analogous
Governmental Authority (including, without limitation, any filing made by the
Borrower or any Subsidiary pursuant to any insurance holding company act or
related rules or regulations), but excluding routine or non-material filings
with the NAIC, any insurance commissioner or department or analogous
Governmental Authority.  

(s)In addition to the requirements of clause (c)(iii) above, as promptly as
reasonably practicable following the request of the Required Lenders, a report
prepared by an accounting or actuarial firm or internal actuary, as delivered to
the Department, reviewing the adequacy of Loss Reserves of each Insurance
Subsidiary, which firm shall be provided access to or copies of all reserve
analyses and valuations relating to the insurance business of each Insurance
Subsidiary in the possession of or available to the Borrower or its
Subsidiaries; provided, that, in the event that the written review required to
be provided to the Lenders in respect of any Fiscal Year pursuant to clause
(c)(iii) above is provided by an independent actuarial consulting firm
reasonably satisfactory to the Administrative Agent, or a written review of an
independent actuarial consulting firm reasonably satisfactory to the
Administrative Agent satisfying the requirements set forth in clause (c)(iii) is
otherwise delivered to the Lenders at any time other than pursuant to such
clause, then the Required Lenders may not request a report pursuant to this
clause (s) until one year after the delivery date of such report unless, at the
time of such request, a Default is in existence.

(t)If a Collateralization Event has occurred, (i) as soon as available, but in
any event within 10 days after the end of each calendar month of each fiscal
year (x) a report listing the Eligible Collateral and (y) a Borrowing Base
Certificate executed by a Authorized Officer.  For purposes of such report and
of completing the Borrowing Base Certificate required under this Section 6.1(t),
Eligible Collateral shall be valued based on the Fair Market Value as at the
last Business Day of the calendar month for which such report or Borrowing Base
Certificate is being delivered and (ii) promptly, at the request of the
Administrative Agent, a Borrowing Base Certificate for any given Business Day
executed by a Authorized Officer.

(u)As soon as possible and in any event within five (5) days of delivery to
Lloyds, the Franchise Performance Management Quarterly Monitoring Reports for
the Supported Syndicate.

(v)As soon as possible and in any event within five (5) days of receipt from
Lloyds, copies of the annual solvency statements prepared by Lloyd’s for the
Supported Syndicate.

(w)As soon as possible and in any event within five (5) days of delivery to
Lloyds, the Syndicate Business Forecast of the Supported Syndicate which for the
avoidance of doubt shall included full RDS details and a syndicate reinsurance
summary.

(x)As soon as possible and in any event within thirty (30) days of receipt from
Lloyds, a summary of any material change in Lloyd’s RDS definitions or reporting
requirements as well as the impact that such changes may have on the
calculations

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provided pursuant to Section 4.1(a)(viii) and compliance with the covenant set
forth in Section 6.23(f).

(y)As soon as possible and in any event within five (5) days of the occurrence
thereof, notice of a distribution or withdrawal of any Solvency Surplus then
included  in the calculation of the Adjusted Primary FAL together with a
calculation of Adjusted Primary FAL (and, if the Borrower has been required to
post Collateral, a Borrowing Base Certificate) after giving effect to such
distribution or withdrawal

(z)As soon as possible and in any event within five (5) days of delivery of the
same to Lloyd’s or any other insurance regulator or Governmental Authority, all
other ad hoc or exceptional financial reports provided by the Supported
Syndicate or the Borrower.

6.2Purpose.  Letters of Credit will be issued to provide Funds at Lloyd’s to
support underwriting capacity provided by the Corporate Member to the Supported
Syndicate for the 2017 and 2018 underwriting years of account (and prior open
years).

6.3Notice of Material Events.  The Borrower will, promptly after becoming aware
of the occurrence of any of the following, give notice in writing to the Lenders
of the occurrence of (a) any Default or Unmatured Default, (b) the existence of
an NSF Deficiency, (c) of any other event or development, financial or otherwise
which could reasonably be expected to have a Material Adverse Effect, (d) the
receipt of any notice from any Governmental Authority or Lloyd’s of the
expiration without renewal, revocation or suspension of, or the institution of
any proceedings to revoke or suspend, any License now or hereafter held by any
Insurance Subsidiary which is required to conduct insurance business in
compliance with all applicable laws and regulations and the expiration,
revocation or suspension of which could reasonably be expected to have a
Material Adverse Effect, (e) the receipt of any notice from any Governmental
Authority or Lloyd’s of the institution of any disciplinary proceedings against
or in respect of any Insurance Subsidiary, or the issuance of any order, the
taking of any action or any request for an extraordinary audit for cause by any
Governmental Authority which, if adversely determined, could reasonably be
expected to have a Material Adverse Effect, (f) any material judicial or
administrative order limiting or controlling the business of any Subsidiary (and
not the industry in which such Subsidiary is engaged generally) which has been
issued or adopted or (g) the commencement of any litigation which could
reasonably be expected to result in a Material Adverse Effect.

6.4Conduct of Business.  The Borrower will, and will cause each Subsidiary to,
(a) carry on and conduct its business only in the Existing Lines of Business or
in other lines of the insurance business or in activities reasonably incidental
to the insurance business, (b) do all things necessary to remain duly
incorporated or organized, validly existing and (to the extent such concept
applies to such entity) in good standing in its jurisdiction of incorporation
and its jurisdiction of incorporation or organization, as the case may be, and
maintain all requisite authority to conduct its business in each other
jurisdiction in which such qualification is required and (c) do all things
necessary to renew, extend and continue in effect all Licenses material to its
business which may at any time and from time to time be necessary for any
Insurance Subsidiary to operate its business in compliance with all applicable
laws and regulations.  No Insurance

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Subsidiary shall change its state of domicile or incorporation without the prior
written consent of the Required Lenders.  The Borrower will not become an entity
deemed to hold “plan assets” within the meaning of 29 C.F.R. § 2510.3-101 of an
employee benefit plan (as defined in Section 3(3) of ERISA) which is subject to
Title I of ERISA or any plan (within the meaning of Section 4975 of the Code).

6.5 Taxes.  The Borrower will, and will cause each Subsidiary to, timely file
United States federal and applicable foreign, state and local tax returns
required by applicable law complete and correct in all material respects and pay
when due all material taxes, assessments and governmental charges and levies
upon it or its income, profits or Property, except those which are being
contested in good faith by appropriate proceedings and with respect to which
adequate reserves have been set aside in accordance with Agreement Accounting
Principles and SAP, as applicable.

6.6Insurance.  The Borrower will, and will cause each Subsidiary to, maintain
with financially sound and reputable insurance companies insurance on all their
Property in such amounts and covering such risks as is consistent with sound
business practice, and the Borrower will furnish to the Administrative Agent and
any Lender upon request full information as to the insurance carried.

6.7Compliance with Laws.  The Borrower will, and will cause each Subsidiary to,
comply with all laws, rules, regulations, orders, writs, judgments, injunctions,
decrees or awards to which it may be subject, including, without limitation, all
Environmental Laws, the noncompliance with which could reasonably be expected to
have a Material Adverse Effect.  The Borrower will maintain in effect and
enforce policies and procedures designed to ensure compliance by the Borrower,
its Subsidiaries and their respective directors, officers, employees and agents
with Anti-Corruption Laws, Anti-Corruption Laws and applicable Sanctions

6.8Maintenance of Properties.  The Borrower will, and will cause each Subsidiary
to, do all things necessary to maintain, preserve, protect and keep its Property
in good repair, working order and condition, and make all necessary and proper
repairs, renewals and replacements so that its business carried on in connection
therewith may be properly conducted at all times in all material respects.

6.9Inspection; Maintenance of Books and Records.  The Borrower will, and will
cause each Subsidiary to, permit the Administrative Agent and the Lenders, by
their respective representatives and agents, to inspect any of the Property,
books and financial records of the Borrower and each Subsidiary, to examine and
make copies of the books of accounts and other financial records of the Borrower
and each Subsidiary, and to discuss the affairs, finances and accounts of the
Borrower and each Subsidiary with, and to be advised as to the same by, their
respective officers at such reasonable times and intervals, during normal
business hours and upon reasonable prior notice to the Borrower, as the
Administrative Agent or any Lender may designate.  The Borrower will keep or
cause to be kept, and cause each Subsidiary to keep or cause to be kept,
appropriate records and books of account in which complete entries are to be
made reflecting its and their business and financial transactions, such entries
to be made in accordance with Agreement Accounting Principles and SAP, as
applicable, consistently applied.

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6.10Dividends and Stock Repurchases.  The Borrower will not, nor will it permit
any Subsidiary to, declare or pay any dividends or make any distributions on its
capital stock (other than dividends payable in its own capital stock) or redeem,
repurchase or otherwise acquire or retire any of its capital stock or any
options or other rights in respect thereof at any time outstanding, except that
(a) any Subsidiary may declare and pay dividends or make distributions to the
Borrower or to a Wholly-Owned Subsidiary of the Borrower and (b) the Borrower
may repurchase capital stock and may pay dividends provided after giving effect
thereto (i) Borrower would be in pro forma compliance with the terms of this
Agreement and (ii) no Default shall have occurred.

6.11Indebtedness.  The Borrower will not, nor will it permit any Subsidiary to,
create, incur or suffer to exist any Indebtedness, except:

(a)the Obligations;

(b)Indebtedness of the Borrower in connection with senior unsecured notes in an
aggregate amount not at any time exceeding $300,000,000. For purposes of
calculating Indebtedness under this clause (b), the principal amount of any such
Indebtedness which constitutes Defeased Indebtedness shall not be included;

(c)guaranties permitted under Section 6.15;

(d)capital leases in amounts not in excess of $2,500,000 at any time
outstanding;

(e)up to $50,000,000 of Indebtedness issued in the ordinary course of business
in support of insurance and reinsurance operations of the Company or any of its
Subsidiaries;

(f)up to $25,000,000 of Indebtedness of the Borrower under the ING Bilateral
Facility; and

(g)other Indebtedness, in addition to the Indebtedness listed above, in an
aggregate amount not at any time exceeding $50,000,000; provided that such other
Indebtedness shall (i) have a maturity date after the Letter of Credit
Availability Termination Date and (ii) be pari passu or subordinated to the
Obligations.

6.12Merger.  The Borrower will not, nor will it permit any Subsidiary to, merge
or consolidate with or into any Person, except that (a) a Subsidiary may merge
into the Borrower or any Wholly-Owned Subsidiary and (b) the Borrower may merge
with or consolidate with any Person, provided that (i) the Borrower is the
surviving entity, (ii) no Default or Unmatured Default has occurred or will
occur as a result of such merger or consolidation and (iii) the Administrative
Agent has received a certificate from the Borrower showing that the Borrower
would be in pro forma compliance with the terms of this Agreement after giving
effect to such merger or consolidation.

6.13Sale of Assets.  The Borrower will not, nor will it permit any Subsidiary
to, lease, sell, transfer or otherwise dispose of its Property, to any other
Person except:

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(a)sales of inventory in the ordinary course of business; and

(b)leases, sales, transfers or other dispositions of its Property that, together
with all other Property of the Borrower and its Subsidiaries previously leased,
sold or disposed of (other than inventory or Investments (other than Investments
in Subsidiaries) sold in the ordinary course of business) as permitted by this
Section 6.13 since the Amendment Effective Date, do not constitute a Substantial
Portion of the Property of the Borrower and its Subsidiaries.

6.14Investments and Acquisitions.  The Borrower will not, nor will it permit any
Subsidiary to, make or suffer to exist any Investment (including, without
limitation, loans and advances to, and other Investments in, Subsidiaries), or
commitments therefor, or to create any Subsidiary or to become or remain a
partner in any partnership or joint venture, or to make any Acquisitions,
except:

(a)Cash Equivalent Investments;

(b)Investments in debt securities rated A- or better by S&P, A3 or better by
Moody’s or NAIC-1 or better by the NAIC;

(c)existing Investments in Subsidiaries and other Investments in existence on
the Amendment Effective Date;

(d)Investments in debt securities rated less than A- by S&P, A3 by Moody’s or
NAIC-1 by the NAIC but BBB- or better by S&P, Baa3 or better by Moody’s or
NAIC-2 or better by the NAIC; provided, that all such Investments under this
clause (d) do not exceed, in the aggregate at any one time outstanding, 20% of
the Total Investment Portfolio; provided, further, that if any such Investment
ceases to meet such ratings requirements, then such Investment shall be
permitted hereby for a period of one hundred and eighty (180) days after the
date on which such ratings requirement is no longer satisfied;

(e)Investments in debt securities not satisfying any of the standards, including
the percentage limitations, set forth in clauses (b) or (d) above in an
aggregate amount not exceeding 5% of the Total Investment Portfolio;

(f)Investments by the Borrower (not including Investments in Subsidiaries) in
equity securities in an aggregate amount not to exceed 20% of the Total
Investment Portfolio; provided that no single Investment in equity securities
(excluding investments in diversified mutual funds and investments in passively
managed ETF Shares tracking bond indices (which shall be treated as debt
securities for purposes of clauses (b), (d) and (e) above)) shall be in an
amount in excess of 20% of the total aggregate investments in equity securities;

(g)other Investments after the Amendment Effective Date in an aggregate amount
not to exceed 1% of the Total Investment Portfolio;

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(h)Acquisitions in an aggregate amount not to exceed 5% of Consolidated Net
Worth of the Borrower and its Consolidated Subsidiaries in any Fiscal Year; and

(i)Investments by Navigators in Wholly-Owned Subsidiaries of Navigators
(including new Wholly-Owned Subsidiaries of Navigators);

provided that the Borrower will not, and will not permit any Subsidiary to, make
any Investments not in conformity with its then applicable investment
guidelines.

6.15Contingent Obligations.  The Borrower will not, nor will it permit any
Subsidiary to, make or suffer to exist any Contingent Obligation (including,
without limitation, any Contingent Obligation with respect to the obligations of
a Subsidiary), except (a) by endorsement of instruments for deposit or
collection in the ordinary course of business, (b) Contingent Obligations in
respect of Letters of Credit and letters of credit issued under the Indebtedness
permitted under Section 6.11(f), (c) obligations with respect to letters of
credit not issued pursuant to this Agreement with the Corporate Member as
applicant so long as none of the Borrower or its Subsidiaries is a co-applicant
with respect thereto or otherwise guaranties such obligations, and (d)
Contingent Obligations with respect to letters of credit issued in the ordinary
course of certain Wholly-Owned Subsidiaries with respect to marine insurance
policies issued thereby; provided, however, that the Borrower or any of its
Wholly-Owned Subsidiaries may guarantee (i) the obligations of any Person that
is its or its Subsidiary’s employee so long as the aggregate amount of all such
guaranteed obligations, taken together with the aggregate amount of any and all
loans to such Persons by the Borrower in accordance with Section 6.14
outstanding at any time do not in the aggregate exceed $500,000 and (ii) the
obligations of any Wholly-Owned Subsidiary under office space leases for space
used by such Wholly-Owned Subsidiary.

6.16Liens. The Borrower will not, nor will it permit any Subsidiary to, create,
incur, or suffer to exist any Lien in, of or on the Property of the Borrower or
any of its Subsidiaries, except:

(a)Liens for taxes, assessments or governmental charges or levies on its
Property if the same shall not at the time be delinquent or thereafter can be
paid without penalty, or are being contested in good faith and by appropriate
proceedings and for which adequate reserves in accordance with Agreement
Accounting Principles shall have been set aside on its books;

(b)Liens imposed by law, such as carriers’, warehousemen’s and mechanics’ Liens
and other similar Liens arising in the ordinary course of business which secure
the payment of obligations not more than sixty (60) days past due or which are
being contested in good faith by appropriate proceedings and for which adequate
reserves shall have been set aside on its books;

(c)Liens arising out of pledges or deposits under worker’s compensation laws,
unemployment insurance, old age pensions, or other social security or retirement
benefits, or similar legislation;

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(d)Utility easements, building restrictions and such other encumbrances or
charges against real property as are of a nature generally existing with respect
to properties of a similar character and which do not in any material way affect
the marketability of the same or interfere with the use thereof in the business
of the Borrower or its Subsidiaries;

(e)Liens existing on the Amendment Effective Date and described in Schedule 6.16
hereto;

(f)Liens in favor of the Administrative Agent, for the benefit of the Secured
Parties, granted pursuant to the Security Documents;

(g)Deposits of cash or securities with or on behalf of state insurance
departments reflected in the Insurance Subsidiaries’ Statutory Financial
Statements;

(h)Deposits of cash or securities by the Borrower with Lloyd’s;

(i)Liens on assets subject to capital leases permitted under Section 6.11(d);

(j)Liens securing Indebtedness permitted under Section 6.11(f); and

(k)Liens, in addition to the Liens listed above, securing Indebtedness in an
aggregate amount at any time not exceeding $10,000,000.

6.17Affiliates.  The Borrower will not, and will not permit any Subsidiary to,
enter into any transaction (including, without limitation, the purchase or sale
of any Property or service) with, or make any payment or transfer to (other than
dividends and stock repurchases permitted under Section 6.10), any Affiliate
except in the ordinary course of business and pursuant to the reasonable
requirements of the Borrower’s or such Subsidiary’s business and upon fair and
reasonable terms no less favorable to the Borrower or such Subsidiary than the
Borrower or such Subsidiary would obtain in a comparable arms‑length
transaction.

6.18Amendments to Agreements.  The Borrower will not, and will not permit any
Subsidiary to, amend, waive, modify or terminate any of its constituent
documents in any manner that could be expected to have a negative effect in any
material respect on the Secured Parties.

6.19Change in Fiscal Year. The Borrower shall not, nor shall it permit any
Subsidiary to, change its Fiscal Year to end on any date other than December 31
of each year.

6.20Inconsistent Agreements.  The Borrower shall not, nor shall it permit any
Subsidiary to, enter into any indenture, agreement, instrument or other
arrangement which, (a) directly or indirectly prohibits or restrains, or has the
effect of prohibiting or restraining, or imposes materially adverse conditions
upon, the incurrence of the Obligations, the granting of Liens to secure the
Obligations, the amending of the Facility Documents or the ability of any
Subsidiary to (i) pay dividends or make other distributions on its capital
stock, (ii) make loans or advances to the Borrower or (iii) repay loans or
advances from the Borrower or (b) contains any provision which would be violated
or breached by the issuance of Letters of Credit or by the

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performance by the Borrower or any Subsidiary of any of its Obligations under
any Facility Document.

6.21Reinsurance.  (a)  The Borrower shall cause each Insurance Subsidiary to
maintain reinsurance protection with respect to each individual insurance policy
written by such Insurance Subsidiary which reinsurance protection, in the event
of a loss, limits the net loss of such Insurance Subsidiary under such insurance
policy to 2.5% or less of the Statutory Surplus of such Insurance
Subsidiary.  For purposes of this Section 6.21(a), the term “net loss” shall
mean the loss and loss adjustment expenses incurred by the Insurance Subsidiary
under an insurance policy net of any amounts recoverable or recovered from
reinsurers with respect to such loss and loss adjustment expenses without regard
to any reinstatement premiums paid or payable to such reinsurer.

(b)The Borrower shall not cause or permit an Insurance Subsidiary to enter into
or maintain, as a cedent, reinsurance agreements or retrocession agreements with
any Person other than an Approved Reinsurer; provided, however, that the
foregoing shall not require an Insurance Subsidiary to terminate a reinsurance
agreement or retrocession agreement if such Person ceases to be an Approved
Reinsurer due to a downgrade by The A.M. Best Company, Inc. or S&P and such
reinsurance or retrocession agreement cannot be replaced on commercially
reasonable terms.

(c)The Borrower shall not cause or permit an Insurance Subsidiary to enter into
or maintain, as a cedent, reinsurance agreements or retrocession agreements with
any Person which do not comply with the guidelines for reinsurance by Insurance
Subsidiaries set forth on Schedule 6.21 hereto, as amended with the consent of
the Lenders (the “Reinsurance Guidelines”); provided, however, that the
foregoing shall not require an Insurance Subsidiary to terminate a reinsurance
agreement or retrocession agreement if such Person ceases to be an Approved
Reinsurer due to a downgrade by The A.M. Best Company, Inc. or S&P and such
reinsurance or retrocession agreement cannot be replaced on commercially
reasonable terms.

6.22Stock of Subsidiaries.  The Borrower shall not sell or otherwise dispose of
(including the granting of any security interest in) any shares of capital stock
of any Subsidiary other than pursuant to the Security Agreement, or permit any
Subsidiary to issue additional shares of its capital stock, except the minimum
number of directors’ qualifying shares required by applicable law.

6.23Financial Covenants.

(a)Minimum Consolidated Tangible Net Worth.  The Borrower will at all times
maintain Consolidated Tangible Net Worth of not less than $882,458,226.

(b)Minimum Statutory Surplus.  The Borrower will at all time cause Navigators
Insurance Subsidiaries to maintain an aggregate Statutory Surplus of not less
than $773,593,050.  

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(c)Leverage Ratio.  The Borrower will not permit the Leverage Ratio to exceed
0.30 to 1.0 at any time.  For purposes of calculating the Leverage Ratio,
Defeased Indebtedness shall not be included.

(d)Minimum Risk-Based Capital.  The Borrower will at all times cause each
Significant Insurance Subsidiary to maintain a ratio of (a) Total Adjusted
Capital (as defined in the Risk-Based Capital Act or in the rules and procedures
prescribed from time to time by the NAIC with respect thereto) to (b) the
Company Action Level RBC (as defined in the Risk-Based Capital Act or in the
rules and procedures prescribed from time to time by the NAIC with respect
thereto) of at least 150%.

(e)Adjusted Primary FAL.  Adjusted Primary FAL shall not be less than 40% of the
Letter of Credit Obligations at any time.

(f)RDS.  The highest net loss from a single Lloyd’s specified RDS for the
Supported Syndicate shall not at any time exceed 30% of the approved Syndicate
Economic Capital Assessment plus profit for any Year of Account.

6.24Additional Pledge.  Effective upon any Person becoming a Significant
Subsidiary, the parent thereof shall pledge the stock or other equity interests
thereof to the Administrative Agent for the benefit of the Secured Parties
pursuant to documentation reasonably acceptable to the Administrative Agent
provided that no pledge of the stock of NSIC shall be required so long as NSIC
is not a direct Subsidiary of the Borrower.

6.25Primary FAL . Subject to the duties of Lloyd’s as trustee of all such Funds
at Lloyd’s and to any conditions and requirements prescribed under the
Membership Byelaw which are applicable, the Borrower will cause the Corporate
Member and the Managing Agent to use their best efforts to cause the Primary FAL
of the Supported Syndicate to be applied to its obligations and only after such
Primary FAL has been exhausted, to draw under the Letters of Credit.

6.26Syndicate Business Forecasts. The Borrower shall (a) cause the Corporate
Member and the Supported Syndicate to continue to operate at all times and in
all respects within the requirements of the most recent Syndicate Business
Forecasts submitted to Lloyd’s and (b) for any Year of Account, not permit the
Supported Syndicate to underwrite on terms that fall outside the Syndicate
Business Forecasts approved by Lloyd’s for the Years of Account supported by
Letters of Credit.

6.27Anti-Money Laundering and Anti-Terrorism Finance Laws; Foreign Corrupt
Practices Act; Sanctions Laws; Restricted Person.  The Borrower shall not, and
shall not permit any Subsidiary to, (a) engage in or conspire to engage in any
transaction that evades or avoids, or has the purpose of evading or avoiding, or
otherwise violates, any Anti-Terrorism Law, Anti-Corruption Law or Sanctions
law, (b) knowingly cause or permit any of the funds that are used to repay the
Obligations to be derived from any unlawful activity with the result that the
Administrative Agent, the Letter of Credit Agent, any Lender or the Borrower
would be in violation of any Anti-Terrorism Law, Anti-Corruption Law or
Sanctions law or (c) use any part of the proceeds of the Letters of Credit,
directly or, to the knowledge of the Borrower, indirectly,

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for any conduct that would cause the representations and warranties in Sections
5.28 and 5.29 to be untrue as if made on the date any such conduct occurs.

ARTICLE VII

DEFAULTS

The occurrence of any one or more of the following events shall constitute a
Default:

7.1Any representation or warranty made or deemed made by or on behalf of the
Borrower or any of its Subsidiaries to the Lenders or the Administrative Agent
under or in connection with this Agreement, any other Facility Document, any
Letter of Credit or any certificate or information delivered in connection with
this Agreement or any other Facility Document shall be false in any material
respect on the date as of which made or deemed made.

7.2Nonpayment of (a) any principal of any Reimbursement Obligation when due, or
(b) any interest, Unused Fee, Letter of Credit Fee or other fee or obligations
under any of the Facility Documents within five (5) days after written notice
from the Administrative Agent or any Lender.

7.3The breach by the Borrower of any of the terms or provisions of Sections 2.8,
6.2, 6.3, Sections 6.10 through 6.13, Sections 6.15 through 6.20 or
Sections 6.22 through 6.23 or 6.26.

7.4The breach by the Borrower (other than a breach which constitutes a Default
under Sections 7.1, 7.2 or 7.3) of any of the terms or provisions of this
Agreement which is not remedied within thirty (30) days (or in the case of
Section 6.14, ten (10) days) after the Borrower has knowledge thereof or written
notice from the Administrative Agent or any Lender.

7.5Failure of the Borrower or any of its Subsidiaries to pay any Indebtedness
aggregating in excess of $2,500,000 when due; or the default by the Borrower or
any of its Subsidiaries in the performance of any term, provision or condition
contained in any agreement under which any such Indebtedness was created or is
governed, or the occurrence of any other event or existence of any other
condition, the effect of any of which is to cause, or to permit the holder or
holders of such Indebtedness to cause, such Indebtedness to become due prior to
its stated maturity; or any such Indebtedness of the Borrower or any of its
Subsidiaries shall be declared to be due and payable or required to be prepaid
(other than by a regularly scheduled payment) prior to the stated maturity
thereof.

7.6The Borrower or any of its Subsidiaries shall (a) have an order for relief
entered with respect to it under the Federal bankruptcy laws as now or hereafter
in effect, (b) make an assignment for the benefit of creditors, (c) apply for,
seek, consent to, or acquiesce in, the appointment of a receiver, custodian,
trustee, examiner, liquidator or similar official for it or any Substantial
Portion of its Property, (d) institute any proceeding seeking an order for
relief under the Federal bankruptcy laws as now or hereafter in effect or
seeking to adjudicate it a bankrupt or insolvent, or seeking dissolution,
winding up, liquidation, reorganization, arrangement, adjustment or composition
of it or its debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors or fail to file an answer or other pleading
denying the material

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allegations of any such proceeding filed against it, (e) take any corporate
action to authorize or effect any of the foregoing actions set forth in this
Section 7.6, (f) fail to contest in good faith any appointment or proceeding
described in Section 7.7 or (g) become unable to pay, not pay, or admit in
writing its inability to pay, its debts generally as they become due.

7.7Without the application, approval or consent of the Borrower or any of its
Subsidiaries, a receiver, trustee, examiner, liquidator or similar official
shall be appointed for the Borrower or any of its Subsidiaries or any
Substantial Portion of its Property, or a proceeding described in Section 7.6(d)
shall be instituted against the Borrower or any of its Subsidiaries and such
appointment continues undischarged or such proceeding continues undismissed or
unstayed for a period of thirty (30) consecutive days.

7.8Any court, government or governmental agency shall condemn, seize or
otherwise appropriate, or take custody or control of (each a “Condemnation”),
all or any portion of the Property of the Borrower and its Subsidiaries which,
when taken together with all other Property of the Borrower and its Subsidiaries
so condemned, seized, appropriated, or taken custody or control of, during the
twelve‑month period ending with the month in which any such Condemnation occurs,
constitutes a Substantial Portion.

7.9The Borrower or any of its Subsidiaries shall fail within thirty (30) days to
pay, bond or otherwise discharge one or more (a) final, nonappealable judgments
or orders for the payment of money in excess of $2,500,000 (or the equivalent
thereof in currencies other than U.S. Dollars) in the aggregate, or (b) final,
nonappealable nonmonetary judgments or orders which, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect, which
judgment(s), in any such case, is/are not stayed on appeal or otherwise being
appropriately contested in good faith.

7.10Any Reportable Event shall occur in connection with any Plan.

7.11The Borrower or any other member of the Controlled Group shall have been
notified by the sponsor of a Multiemployer Plan that it has incurred withdrawal
liability to such Multiemployer Plan in an amount which, when aggregated with
all other amounts required to be paid to Multiemployer Plans by the Borrower or
any other member of the Controlled Group as withdrawal liability (determined as
of the date of such notification), exceeds $2,500,000.

7.12The Borrower or any other member of the Controlled Group shall have been
notified by the sponsor of a Multiemployer Plan that such Multiemployer Plan is
in reorganization or is being terminated, within the meaning of Title IV of
ERISA, if as a result of such reorganization or termination the aggregate annual
contributions of the Borrower and the other members of the Controlled Group
(taken as a whole) to all Multiemployer Plans which are then in reorganization
or being terminated have been or will be increased over the amounts contributed
to such Multiemployer Plans for the respective plan years of each such
Multiemployer Plan immediately preceding the plan year in which the
reorganization or termination occurs by an amount exceeding $2,500,000.

7.13The Borrower or any of its Subsidiaries shall (a) be the subject to any
proceeding or investigation pertaining to the release by the Borrower, any of
its Subsidiaries or any other

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Person of any toxic or hazardous waste or substance into the environment, or
(b) violate any Environmental Law, which, in the case of an event described in
clause (a) or (b), could reasonably be expected to have a Material Adverse
Effect.

7.14Any Change in Control shall occur.

7.15The occurrence of any “default”, as defined in any Facility Document (other
than this Agreement) or the breach of any of the terms or provisions of any
Facility Document (other than this Agreement), which default or breach continues
beyond any period of grace therein provided.

7.16There shall occur a change in the business, Property, condition (financial
or otherwise) or results of operations of the Borrower and its Subsidiaries
which has a Material Adverse Effect.

7.17The Borrower or any of its Subsidiaries incurs or becomes subject to action
or threatened action of any Governmental Authority, including, without
limitation, a fine, penalty, cease and desist order or revocation, suspension or
limitation of a License, the effect of which could reasonably be expected to
have a Material Adverse Effect.

7.18Any Security Document shall for any reason fail to create a valid and
perfected, first priority security interest in any Collateral purported to be
covered thereby, except as permitted by the terms of such Security Document, or
any Facility Document, once executed, shall fail to remain in full force or
effect or any action shall be taken to discontinue or to assert the invalidity
or unenforceability of any Facility Document.

7.19Lloyd’s shall draw under a Letter of Credit except as permitted by the terms
of the Lloyd’s Comfort Letter or Lloyd’s shall advise that it will not abide by
the terms of the Lloyd’s Comfort Letter.

ARTICLE VIII

ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES

8.1Acceleration.  If any Default described in Section 7.6 or 7.7 occurs with
respect to the Borrower, the obligations of the Letter of Credit Agent and the
Lenders to issue or increase Letters of Credit hereunder shall automatically
terminate and the Obligations shall immediately become due and payable without
any election or action on the part of the Letter of Credit Agent, the
Administrative Agent or any Lender.  If any other Default occurs, the Required
Lenders (or the Administrative Agent with the consent of the Required Lenders)
may terminate or suspend the obligations of the Letter of Credit Agent and the
Lenders to issue or increase   Letters of Credit hereunder, or declare the
Obligations to be due and payable, or both, whereupon the Obligations shall
become immediately due and payable, without presentment, demand, protest or
notice of any kind, all of which the Borrower hereby expressly waives.  In
addition to the foregoing, following the occurrence and during the continuance
of a Default, so long as any Letter of Credit has not been fully drawn and has
not been canceled or expired by its terms, upon demand by the Administrative
Agent (which demand shall be made upon the request of the Required Lenders), the
Borrower shall deposit Collateral as required by Section 2.9(g).

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If, within thirty (30) days after acceleration of the maturity of the
Obligations or termination of the obligations of the Letter of Credit Agent and
the Lenders to issue and increase Letters of Credit hereunder as a result of any
Default (other than any Default as described in Section 7.6 or 7.7 with respect
to the Borrower) and before any judgment or decree for the payment of the
Obligations due shall have been obtained or entered, the Required Lenders (in
their sole discretion) may direct the Administrative Agent to rescind and annul
such acceleration and/or termination.

8.2Amendments.  Subject to the provisions of this Article VIII, the Required
Lenders (or the Administrative Agent with the consent of the Required Lenders)
and the Borrower may enter into agreements supplemental hereto for the purpose
of adding or modifying any provisions to the Facility Documents or changing in
any manner the rights of the Lenders or the Borrower hereunder or waiving any
Default hereunder; provided, however, that no such supplemental agreement shall,
without the consent of each Lender:

(a)Extend the final maturity of any Obligations or forgive all or any portion of
the Reimbursement Obligations, or reduce the rate or extend the time of payment
of interest or fees (including without limitation Letter of Credit Fees)
hereunder;

(b)Reduce or modify the percentage specified in the definition of Required
Lenders;

(c)Reduce the amount of or extend the date for payment of Reimbursement
Obligations under Section 2.4, or increase the amount of the Commitment of any
Lender hereunder;

(d)Extend the Letter of Credit Availability Termination Date; permit any Letter
of Credit to have an expiry date beyond four years after the Expiry Notice is
issued;

(e)Permit any amendment of Section 8.4;

(f) Release any guarantor of any Obligations or, except as provided in the
Security Agreement, release any of the Collateral for the Obligations or
decrease the amount of Collateral required under Sections 2.9 or 8.1;

(g)Permit any assignment by the Borrower of its Obligations or its rights
hereunder; or

(h)Permit any amendment of the Reinsurance Guidelines;

provided, further, that no such supplemental agreement shall, without the
consent of each Lender, amend this Section 8.2.  No amendment of any provision
of this Agreement relating to the Administrative Agent or the Letter of Credit
Agent shall be effective without the written consent of the Administrative Agent
or the Letter of Credit Agent, as applicable.  The Administrative Agent may
waive payment of the fee required under Section 12.3(b) without obtaining the
consent of any other party to this Agreement.  Notwithstanding anything to the
contrary herein, no Defaulting Lender shall have any right to approve or
disapprove any

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amendment, waiver or consent hereunder, except that the Commitment of such
Lender may not be increased or extended without the consent of such Lender.

8.3Preservation of Rights.  No delay or omission of the Lenders, the Letter of
Credit Agent or the Administrative Agent to exercise any right under the
Facility Documents shall impair such right or be construed to be a waiver of any
Default or an acquiescence therein, and the issuance of a Letter of Credit
notwithstanding the existence of a Default or the inability of the Borrower to
satisfy the conditions precedent to such Letter of Credit shall not constitute
any waiver or acquiescence.  Any single or partial exercise of any such right
shall not preclude other or further exercise thereof or the exercise of any
other right, and no waiver, amendment or other variation of the terms,
conditions or provisions of the Facility Documents whatsoever shall be valid
unless in writing signed by the Lenders required pursuant to Section 8.2, and
then only to the extent in such writing specifically set forth.  All remedies
contained in the Facility Documents or by law afforded shall be cumulative and
all shall be available to the Administrative Agent and the Lenders until the
Obligations have been paid in full.

8.4Application of Funds.  After the occurrence of a Default, any amounts
received on account of the Obligations (including proceeds of Collateral) shall
be applied by the Administrative Agent in the following order:

First, to payment of that portion of the Obligations constituting fees,
indemnities, expenses and other amounts (including fees, charges and
disbursements of counsel to the Administrative Agent and amounts payable under
Article III) payable to the Administrative Agent and the Letter of Credit Agent
in its capacity as such;

Second, to payment of that portion of the Obligations constituting fees,
indemnities and other amounts (other than Reimbursement Obligations, interest
and Letter of Credit Fees) payable to the Lenders (including fees, charges and
disbursements of counsel to the respective Lenders (including, without
duplication, fees and time charges for attorneys who may be employees of any
Lender) and amounts payable under Article III), ratably among them in proportion
to the respective amounts described in this clause Second payable to them;

Third, to payment of that portion of the Obligations constituting accrued and
unpaid Letter of Credit Fees and interest on the Reimbursement Obligations and
other Obligations, ratably among the Lenders in proportion to the respective
amounts described in this clause Third payable to them;

Fourth, to payment of that portion of the Obligations constituting unpaid
Reimbursement Obligations, ratably among the Lenders in proportion to the
respective amounts described in this clause Fourth held by them;

Fifth, to the Administrative Agent for the account of the Lenders to be held as
Collateral for that portion of the Letter of Credit Obligations comprised of the
aggregate undrawn amount of Letters of Credit; and

Last, the balance, if any, after all of the Obligations have been indefeasibly
paid in full and the Aggregate Commitment has been terminated, to the Borrower
or as otherwise required by Law.

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Amounts held as Collateral for the aggregate undrawn amount of Letters of Credit
pursuant to clause Fifth above shall be applied to satisfy drawings under such
Letters of Credit as they occur.  If any Collateral remains after all Letters of
Credit have either been fully drawn or expired, such remaining amount shall be
applied to the other Obligations, if any, in the order set forth above.

ARTICLE IX

GENERAL PROVISIONS

9.1Survival of Representations.  All representations and warranties of the
Borrower contained in this Agreement or in any Facility Document shall survive
the issuance of the Letters of Credit herein contemplated.

9.2Governmental Regulation.  Anything contained in this Agreement to the
contrary notwithstanding, no Lender shall be obligated to extend credit to the
Borrower in violation of any limitation or prohibition provided by any
applicable statute or regulation.

9.3Headings.  Section headings in the Facility Documents are for convenience of
reference only, and shall not govern the interpretation of any of the provisions
of the Facility Documents.

9.4Entire Agreement.  The Facility Documents embody the entire agreement and
understanding among the Borrower, the Administrative Agent, and the Lenders and
supersede all prior agreements and understandings among the Borrower, the
Administrative Agent, and the Lenders relating to the subject matter thereof
other than the fee letter dated November 7, 2016 in favor of ING Bank N.V.,
London Branch (the “Fee Letter”).

9.5Numbers of Documents.  All statements, notices, closing documents, and
requests hereunder shall be furnished to the Administrative Agent with
sufficient counterparts so that the Administrative Agent may furnish one to each
of the Lenders.

9.6Several Obligations; Benefits of this Agreement.  The respective obligations
of the Lenders hereunder are several and not joint and no Lender shall be the
partner or Administrative Agent of any other (except to the extent to which the
Administrative Agent is authorized to act as such).  The failure of any Lender
to perform any of its obligations hereunder shall not relieve any other Lender
from any of its obligations hereunder.  This Agreement shall not be construed so
as to confer any right or benefit upon any Person other than the parties to this
Agreement and their respective successors and assigns, provided, however, that
the parties hereto expressly agree that the Arranger shall enjoy the benefits of
the provisions of Sections 9.7, 9.11 and 10.12 to the extent specifically set
forth therein and shall have the right to enforce such provisions on its own
behalf and in its own name to the same extent as if it were a party to this
Agreement.

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9.7Expenses; Indemnification. (a) The Borrower shall reimburse the
Administrative Agent, the Security Trustee and the Arranger for any costs,
internal charges and out‑of‑pocket expenses (including reasonable attorneys’
fees and time charges of attorneys for the Administrative Agent) paid or
incurred by the Administrative Agent, the Security Trustee or the Arranger in
connection with the preparation, negotiation, execution, delivery, syndication,
review, amendment, modification, and administration of the Facility
Documents.  The Borrower also agrees to reimburse the Administrative Agent, the
Security Trustee, the Arranger and the Lenders for any costs, internal charges
and out‑of‑pocket expenses (including reasonable attorneys’ fees and time
charges of attorneys for the Administrative Agent, the Arranger and the
Lenders), paid or incurred by the Administrative Agent, the Security Trustee,
the Arranger or any Lender in connection with the investigation, collection and
enforcement of the Facility Documents.

(b)The Borrower hereby further agrees to indemnify the Administrative Agent, the
Security Trustee, the Arranger, each Lender, each Affiliate of a Lender, and the
directors, officers, partners and employees of any of the foregoing against all
losses, claims, damages, penalties, judgments, liabilities and expenses
(including, without limitation, all expenses of litigation or preparation
therefor whether or not the Administrative Agent, the Security Trustee, the
Arranger or any Lender is a party thereto) which any of them may pay or incur
arising out of or relating to this Agreement, the other Facility Documents, the
transactions contemplated hereby or the direct or indirect application or
proposed application of the proceeds of any Letter of Credit hereunder except to
the extent that they have resulted from the gross negligence or willful
misconduct of the party seeking indemnification.  The obligations of the
Borrower under this Section 9.7 shall survive the termination of this Agreement.

9.8Accounting.  Except as provided to the contrary herein, all accounting terms
used herein shall be interpreted and all accounting determinations hereunder
shall be made in accordance with Agreement Accounting Principles.  In the event
the pages, columns, lines or sections of the Annual Statement referenced herein
are changed or renumbered, all such references shall be deemed references to
such page, column, line or section as so renumbered or changed.

9.9Severability of Provisions.  Any provision in any Facility Document that is
held to be inoperative, unenforceable, or invalid in any jurisdiction shall, as
to that jurisdiction, be inoperative, unenforceable, or invalid without
affecting the remaining provisions in that jurisdiction or the operation,
enforceability, or validity of that provision in any other jurisdiction, and to
this end the provisions of all Facility Documents are declared to be severable.

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9.10Nonliability of Lenders.  The relationship between the Borrower on the one
hand and the Lenders and the Administrative Agent on the other hand shall be
solely that of borrower and lender.  Neither the Administrative Agent, the
Arranger, any bookrunner nor any Lender shall have any fiduciary
responsibilities to the Borrower.  Neither the Administrative Agent, the
Arranger, any bookrunner nor any Lender undertakes any responsibility to the
Borrower to review or inform the Borrower of any matter in connection with any
phase of the Borrower’s business or operations.  The Borrower agrees that
neither the Administrative Agent, the Arranger nor any Lender shall have
liability to the Borrower (whether sounding in tort, contract or otherwise) for
losses suffered by the Borrower in connection with, arising out of, or in any
way related to, the transactions contemplated and the relationship established
by the Facility Documents, or any act, omission or event occurring in connection
therewith, unless it is determined in a final non-appealable judgment by a court
of competent jurisdiction that such losses resulted from the gross negligence or
willful misconduct of the party from which recovery is sought.  Neither the
Administrative Agent, the Arranger nor any Lender shall have any liability with
respect to, and the Borrower hereby waives, releases and agrees not to sue for,
any special, indirect, punitive or consequential damages suffered by the
Borrower in connection with, arising out of, or in any way related to the
Facility Documents or the transactions contemplated thereby.

9.11Confidentiality.  Each Lender agrees to hold any confidential information
which it may receive from the Borrower pursuant to this Agreement in confidence,
except for disclosure (a) to its Affiliates and to other Lenders and their
respective Affiliates, (b) to legal counsel, accountants, and other professional
advisors to such Lender or to a Transferee, (c) to regulatory officials, (d) to
any Person as requested pursuant to or as required by law, regulation, or legal
process, (e) to any Person in connection with any legal proceeding to which such
Lender is a party, (f) to such Lender’s direct or indirect contractual
counterparties in swap agreements or to legal counsel, accountants and other
professional advisors to such counterparties and (g) permitted by Section 12.4;
it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such information and instructed to keep
such information confidential.

9.12Nonreliance.  Each Lender hereby represents that it is not relying on or
looking to any margin stock (as defined in Regulation U of the Board of
Governors of the Federal Reserve System) for the repayment of the Obligations
provided for herein.

9.13Disclosure.  The Borrower and each Lender hereby (a) acknowledge and agree
that ING Bank N.V., London Branch and/or its Affiliates from time to time may
hold other investments in, make other loans to or have other relationships with
the Borrower, and (b) waive any liability of ING Bank N.V., London Branch or
such Affiliate to the Borrower or any Lender, respectively, arising out of or
resulting from such investments, loans or relationships other than liabilities
arising out of the gross negligence or willful misconduct of ING Bank N.V.,
London Branch or its Affiliates.

9.14USA Patriot Act Notification.  Each Lender hereby notifies the Borrower that
pursuant to the requirements of the USA Act (Title III of Pub. L. 107-56 (signed
into law on October 26, 2001)) (the “PATRIOT Act”), it is required to obtain,
verify and record information that identifies the Borrower, which information
includes the name and address of the Borrower

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and other information that will allow such Lender to identify the Borrower in
accordance with the PATRIOT Act.  The Borrower agrees to cooperate with each
Lender and provide true, accurate and complete information to such Lender in
response to any such request.  

ARTICLE X

THE AGENT

10.1Appointment; Nature of Relationship.  ING Bank N.V., London Branch is hereby
appointed by each of the Lenders as Administrative Agent (herein referred to as
the “Administrative Agent”) hereunder and under each other Facility Document,
and each of the Lenders irrevocably authorizes the Administrative Agent to act
as the Administrative Agent of such Lender with the rights and duties expressly
set forth herein and in the other Facility Documents.  The Administrative Agent
agrees to act as such Administrative Agent upon the express conditions contained
in this Article X.  Notwithstanding the use of the defined term “Administrative
Agent,” it is expressly understood and agreed that the Administrative Agent
shall not have any fiduciary responsibilities to any Lender by reason of this
Agreement or any other Facility Document and that the Administrative Agent is
merely acting as the Administrative Agent of the Lenders with only those duties
as are expressly set forth in this Agreement and the other Facility
Documents.  In its capacity as the Lenders’ Administrative Agent, the
Administrative Agent (a) does not hereby assume any fiduciary duties to any of
the Lenders, (b) is a “representative” of the Lenders within the meaning of
Section 9‑105 of the Uniform Commercial Code and (c) is acting as an independent
contractor, the rights and duties of which are limited to those expressly set
forth in this Agreement and the other Facility Documents.  Each of the Lenders
hereby agrees to assert no claim against the Administrative Agent on any agency
theory or any other theory of liability for breach of fiduciary duty, all of
which claims each Lender hereby waives.

10.2Powers.  The Administrative Agent shall have and may exercise such powers
under the Facility Documents as are specifically delegated to the Administrative
Agent by the terms of each thereof, together with such powers as are reasonably
incidental thereto.  The Administrative Agent shall have no implied duties to
the Lenders, or any obligation to the Lenders to take any action thereunder
except any action specifically provided by the Facility Documents to be taken by
the Administrative Agent.

10.3General Immunity.  Neither the Administrative Agent nor any of its
directors, officers, agents or employees shall be liable to the Borrower, the
Lenders or any Lender for any action taken or omitted to be taken by it or them
hereunder or under any other Facility Document or in connection herewith or
therewith except to the extent such action or inaction is determined in a final
non-appealable judgment by a court of competent jurisdiction to have arisen from
the gross negligence or willful misconduct of such Person.

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10.4No Responsibility for Recitals, etc.  Neither the Administrative Agent nor
any of its directors, officers, agents or employees shall be responsible for or
have any duty to ascertain, inquire into, or verify:  (a) any statement,
warranty or representation made in connection with any Facility Document or any
borrowing hereunder, (b) the performance or observance of any of the covenants
or agreements of any obligor under any Facility Document, including, without
limitation, any agreement by an obligor to furnish information directly to each
Lender, (c) the satisfaction of any condition specified in Article IV, except
receipt of items required to be delivered solely to the Administrative Agent,
(d) the existence or possible existence of any Default or Unmatured Default,
(e) the validity, enforceability, effectiveness, sufficiency or genuineness of
any Facility Document or any other instrument or writing furnished in connection
therewith, (f) the value, sufficiency, creation, perfection or priority of any
Lien in any Collateral or (g) the financial condition of the Borrower or any
guarantor of any of the Obligations or of any of the Borrower’s or any such
guarantor’s respective Subsidiaries.  The Administrative Agent shall have no
duty to disclose to the Lenders information that is not required to be furnished
by the Borrower to the Administrative Agent at such time, but is voluntarily
furnished by the Borrower to the Administrative Agent (either in its capacity as
Administrative Agent or in its individual capacity).

10.5Action on Instructions of Lenders.  The Administrative Agent shall in all
cases be fully protected in acting, or in refraining from acting, hereunder and
under any other Facility Document in accordance with written instructions signed
by the Required Lenders, and such instructions and any action taken or failure
to act pursuant thereto shall be binding on all of the Lenders.  The Lenders
hereby acknowledge that the Administrative Agent shall be under no duty to take
any discretionary action permitted to be taken by it pursuant to the provisions
of this Agreement or any other Facility Document unless it shall be requested in
writing to do so by the Required Lenders.  The Administrative Agent shall be
fully justified in failing or refusing to take any action hereunder and under
any other Facility Document unless it shall first be indemnified to its
satisfaction by the Lenders pro-rata against any and all liability, cost and
expense that it may incur by reason of taking or continuing to take any such
action.

10.6Employment of Administrative Agent and Counsel.  The Administrative Agent
may execute any of its duties as Administrative Agent hereunder and under any
other Facility Document by or through employees, agents, and attorneys‑in‑fact
and shall not be answerable to the Lenders, except as to money or securities
received by it or its authorized agents, for the default or misconduct of any
such agents or attorneys‑in‑fact selected by it with reasonable care.  The
Administrative Agent shall be entitled to advice of counsel concerning the
contractual arrangement between the Administrative Agent and the Lenders and all
matters pertaining to the Administrative Agent’s duties hereunder and under any
other Facility Document.

10.7Reliance on Documents; Counsel.  The Administrative Agent shall be entitled
to rely upon any notice, consent, certificate, affidavit, letter, telegram,
statement, paper or document believed by it to be genuine and correct and to
have been signed or sent by the proper person or persons, and, in respect to
legal matters, upon the opinion of counsel selected by the Administrative Agent,
which counsel may be employees of the Administrative Agent.

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10.8 Administrative Agent’s Reimbursement and Indemnification.  The Lenders
agree to reimburse and indemnify the Administrative Agent ratably in proportion
to their Applicable Percentage of the Aggregate Commitments (a) for any amounts
not reimbursed by the Borrower for which the Administrative Agent is entitled to
reimbursement by the Borrower under the Facility Documents, (b) for any other
expenses incurred by the Administrative Agent on behalf of the Lenders, in
connection with the preparation, execution, delivery, administration and
enforcement of the Facility Documents (including, without limitation, for any
expenses incurred by the Administrative Agent in connection with any dispute
between the Administrative Agent and any Lender or between two or more of the
Lenders) and (c) for any liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind and
nature whatsoever which may be imposed on, incurred by or asserted against the
Administrative Agent in any way relating to or arising out of the Facility
Documents or any other document delivered in connection therewith or the
transactions contemplated thereby (including, without limitation, for any such
amounts incurred by or asserted against the Administrative Agent in connection
with any dispute between the Administrative Agent and any Lender or between two
or more of the Lenders), or the enforcement of any of the terms of the Facility
Documents or of any such other documents; provided that (i) no Lender shall be
liable for any of the foregoing to the extent any of the foregoing is found in a
final non-appealable judgment by a court of competent jurisdiction to have
resulted from the gross negligence or willful misconduct of the Administrative
Agent and (ii) any indemnification required pursuant to Section 3.3(d) shall,
notwithstanding the provisions of this Section 10.8, be paid by the relevant
Lender in accordance with the provisions thereof.  The obligations of the
Lenders under this Section 10.8 shall survive payment of the Obligations and
termination of this Agreement.

10.9Notice of Default.  The Administrative Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Unmatured Default
hereunder unless the Administrative Agent has received written notice from a
Lender or the Borrower referring to this Agreement describing such Default or
Unmatured Default and stating that such notice is a “notice of default”.  In the
event that the Administrative Agent receives such a notice, the Administrative
Agent shall give prompt notice thereof to the Lenders.

10.10Rights as a Lender.  In the event the Administrative Agent is a Lender, the
Administrative Agent shall have the same rights and powers hereunder and under
any other Facility Document with respect to its Commitment, and any Letters of
Credit in which it has an interest as any Lender and may exercise the same as
though it were not the Administrative Agent, and the term “Lender” or “Lenders”
shall, at any time when the Administrative Agent is a Lender, unless the context
otherwise indicates, include the Administrative Agent in its individual
capacity.  The Administrative Agent and its Affiliates may accept deposits from,
lend money to, and generally engage in any kind of trust, debt, equity or other
transaction, in addition to those contemplated by this Agreement or any other
Facility Document, with the Borrower or any of its Subsidiaries in which the
Borrower or such Subsidiary is not restricted hereby from engaging with any
other Person.  The Administrative Agent, in its individual capacity, is not
obligated to remain a Lender.

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10.11Lender Credit Decision.  Each Lender acknowledges that it has,
independently and without reliance upon the Administrative Agent, the Arranger
or any other Lender and based on the financial statements prepared by the
Borrower and such other documents and information as it has deemed appropriate,
made its own credit analysis and decision to enter into this Agreement and the
other Facility Documents.  Each Lender also acknowledges that it will,
independently and without reliance upon the Administrative Agent, the Arranger
or any other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under this Agreement and the other Facility Documents.

10.12Successor Administrative Agent.  The Administrative Agent may resign at any
time by giving written notice thereof to the Lenders and the Borrower, such
resignation to be effective upon the appointment of a successor Administrative
Agent or, if no successor Administrative Agent has been appointed, forty-five
days after the retiring Administrative Agent gives notice of its intention to
resign.  The Administrative Agent may be removed at any time with or without
cause by written notice received by the Administrative Agent from the Required
Lenders, such removal to be effective on the date specified by the Required
Lenders.  Upon any such resignation or removal, the Required Lenders shall have
the right to appoint, on behalf of the Borrower and the Lenders, a successor
Administrative Agent.  If no successor Administrative Agent shall have been so
appointed by the Required Lenders within thirty days after the resigning
Administrative Agent’s giving notice of its intention to resign, then the
resigning Administrative Agent may appoint, on behalf of the Borrower and the
Lenders, a successor Administrative Agent.  Notwithstanding the previous
sentence, the Administrative Agent may at any time without the consent of the
Borrower or any Lender, appoint any of its Affiliates which is a commercial bank
as a successor Administrative Agent hereunder.  If the Administrative Agent has
resigned or been removed and no successor Administrative Agent has been
appointed, the Lenders may perform all the duties of the Administrative Agent
hereunder and the Borrower shall make all payments in respect of the Obligations
to the applicable Lender and for all other purposes shall deal directly with the
Lenders.  No successor Administrative Agent shall be deemed to be appointed
hereunder until such successor Administrative Agent has accepted the
appointment.  Any such successor Administrative Agent shall be a commercial bank
having capital and retained earnings of at least $100,000,000.  Upon the
acceptance of any appointment as Administrative Agent hereunder by a successor
Administrative Agent, such successor Administrative Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the resigning or removed Administrative Agent.  Upon the effectiveness of the
resignation or removal of the Administrative Agent, the resigning or removed
Administrative Agent shall be discharged from its duties and obligations
hereunder and under the Facility Documents.  After the effectiveness of the
resignation or removal of an Administrative Agent, the provisions of this
Article X shall continue in effect for the benefit of such Administrative Agent
in respect of any actions taken or omitted to be taken by it while it was acting
as the Administrative Agent hereunder and under the other Facility
Documents.  The resignation or removal of the Administrative Agent shall also
constitute a resignation or removal of the Letter of Credit Agent unless the
Letter of Credit Agent agrees otherwise.

10.13Administrative Agents’ Fees.  The Borrower agrees to pay to the
Administrative Agent, for its own account, the fees agreed to by the Borrower
and the Administrative Agent pursuant to the Fee Letter.

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10.14Delegation to Affiliates.  The Borrower and the Lenders agree that the
Administrative Agent may delegate any of its duties under this Agreement to any
of its Affiliates.  Any such Affiliate (and such Affiliate’s directors,
officers, agents and employees) which performs duties in connection with this
Agreement shall be entitled to the same benefits of the indemnification, waiver
and other protective provisions to which the Administrative Agent is entitled
under Articles IX and X.

10.15Security Trustee.  The Security Trustee shall act on behalf of the Lenders
with respect to any Fixed Charge and the documents associated therewith, and
Security Trustee shall have all of the benefits and immunities (A) provided to
the Administrative Agent in this Article X with respect to any acts taken or
omissions suffered by the Security Trustee in connection with it capacity as
Security Trustee as fully as if the term “Administrative Agent” as used in this
Article X includes the Security Trustee as with respect to such acts or
omissions, and (B) as additionally provided herein with respect to Security
Trustee.  The Lenders agree to execute such documents as the Security Trustee
may reasonably request to give effect to any assignment pursuant to Section 12.3
or to enable any Assignee to have the benefits of the lien granted under the
Fixed Charge.

ARTICLE XI

SETOFF; RATABLE PAYMENTS

11.1Setoff.  In addition to, and without limitation of, any rights of the
Lenders under applicable law, if the Borrower becomes insolvent, however
evidenced, or any Default occurs, any and all deposits (including all account
balances, whether provisional or final and whether or not collected or
available) and any other Indebtedness at any time held or owing by any Lender to
or for the credit or account of the Borrower may be offset and applied toward
the payment of the Obligations owing to such Lender, whether or not the
Obligations, or any part hereof, shall then be due.

11.2Ratable Payments.  If any Lender, whether by setoff or otherwise, has
payment made to it upon its Reimbursement Obligations (other than payments
received pursuant to Section 3.1, 3.2 or 3.3) in a greater proportion than that
received by any other Lender, such Lender agrees, promptly upon demand, to
purchase a participation interests in Letters of Credit, as the case may be,
held by the other Lenders so that after such purchase each Lender will hold its
ratable proportion of such participation interests in Letters of Credit.  If any
Lender, whether in connection with setoff or amounts which might be subject to
setoff or otherwise, receives collateral or other protection for its Obligations
or such amounts which may be subject to setoff, such Lender agrees, promptly
upon demand, to take such action necessary such that all Lenders share in the
benefits of such collateral ratably in proportion to their Commitments.  In case
any such payment is disturbed by legal process, or otherwise, appropriate
further adjustments shall be made.

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ARTICLE XII

BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS

12.1Successors and Assigns.  The terms and provisions of the Facility Documents
shall be binding upon and inure to the benefit of the Administrative Agent, the
Borrower and the Lenders and their respective successors and assigns, except
that (a) the Borrower shall not have the right to assign its rights or
obligations under the Facility Documents and (b) any assignment by any Lender
must be made in compliance with Section 12.3.  Notwithstanding clause (b) of the
foregoing sentence, any Lender may at any time, without the consent of the
Borrower or the Administrative Agent, assign all or any portion of its rights
under this Agreement to a Federal Reserve Bank or other central bank; provided,
however, that no such assignment to a Federal Reserve Bank shall release the
transferor Lender from its obligations hereunder.  The Administrative Agent may
treat the Person which issued any Letter of Credit as the Person who has the
Commitment hereunder for all purposes hereof unless and until such Person
complies with Section 12.3 in the case of an assignment thereof or, in the case
of any other transfer, a written notice of the transfer is filed with the
Administrative Agent.  Any assignee or transferee of the rights to any Letter of
Credit agrees by acceptance of such transfer or assignment to be bound by all
the terms and provisions of the Facility Documents.  Any request, authority or
consent of any Person, who at the time of making such request or giving such
authority or consent is the owner of the rights to any Letter of Credit, shall
be conclusive and binding on any subsequent holder, transferee or assignee of
the rights to such Letter of Credit, as the case may be.

12.2Participations.

(a)Permitted Participants; Effect.  Any Lender may, in the ordinary course of
its business and in accordance with applicable law, at any time sell to one or
more banks or other entities (each a “Participant”) participating interests in
any Commitment of such Lender, any interest of such Lender in any Letters of
Credit or any other interest of such Lender under the Facility Documents.  In
the event of any such sale by a Lender of participating interests to a
Participant, such Lender’s obligations under the Facility Documents shall remain
unchanged, such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations, such Lender shall remain the
owner of its interest in any Letters of Credit issued to it in evidence thereof
for all purposes under the Facility Documents, all amounts payable by the
Borrower under this Agreement shall be determined as if such Lender had not sold
such participating interests, and the Borrower and the Administrative Agent
shall continue to deal solely and directly with such Lender in connection with
such Lender’s rights and obligations under the Facility Documents. Each Lender
that sells a participation shall, acting solely for this purpose as a
non-fiduciary agent of the Borrower, maintain a register on which it enters the
name and address of each Participant and the principal amounts (and stated
interest) of each Participant’s interest in the Letter of Credit Obligations or
other obligations under the Facility Documents (the “Participant Register”);
provided that no Lender shall have any obligation to disclose all or any portion
of the Participant Register (including the identity of any Participant or any
information relating to a Participant’s interest in any commitments, loans,
letters of credit or its other obligations under any Facility

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Document) to any Person except to the extent that such disclosure is necessary
to establish that such letter of credit or other obligation is in registered
form under Section 5f.103-1(c) of the United States Treasury Regulations.  The
entries in the Participant Register shall be conclusive absent manifest error,
and such Lender shall treat each Person whose name is recorded in the
Participant Register as the owner of such participation for all purposes of this
Agreement notwithstanding any notice to the contrary.  For the avoidance of
doubt, neither the Administrative Agent nor the Letter of Credit Agent (in its
capacity as Agent) shall have any responsibility for maintaining a Participant
Register.

(b)Voting Rights.  Each Lender shall retain the sole right to approve, without
the consent of any Participant, any amendment, modification or waiver of any
provision of the Facility Documents, except to the extent such amendment,
modification or waiver would require the unanimous consent of the Lenders as
described in Section 8.2.

(c)Benefit of Setoff.  The Borrower agrees that each Participant shall be deemed
to have the right of setoff provided in Section 11.1 in respect of its
participating interest in amounts owing under the Facility Documents to the same
extent as if the amount of its participating interest were owing directly to it
as a Lender under the Facility Documents, provided that each Lender shall retain
the right of setoff provided in Section 11.1 with respect to the amount of
participating interests sold to each Participant.  The Lenders agree to share
with each Participant, and each Participant, by exercising the right of setoff
provided in Section 11.1, agrees to share with each Lender, any amount received
pursuant to the exercise of its right of setoff, such amounts to be shared in
accordance with Section 11.2 as if each Participant were a Lender.

12.3Assignments.

(a)Permitted Assignments.  Any Lender may, in the ordinary course of its
business and in accordance with applicable law, at any time assign to one or
more banks or other entities (“Purchasers”) all or any part of its rights and
obligations under the Facility Documents provided (i) such Purchasers are
Lloyd’s Approved Banks and (ii) such assignment is of a pro rata amount of both
its Tranche A Commitment and Tranche B Commitment.  Such assignment shall be
substantially in the form of Exhibit B or in such other form as may be agreed to
by the parties thereto.  The consent of the Borrower and the Administrative
Agent shall be required prior to an assignment becoming effective with respect
to a Purchaser which is not a Lender or an Affiliate thereof; provided, however,
that if a Default has occurred and is continuing, the consent of the Borrower
shall not be required; provided, further, that the Borrower shall be deemed to
have consented to any such assignment unless it shall object thereto by written
notice to the Administrative Agent within five (5) Business Days after having
received notice thereto.  Such consent shall not be unreasonably withheld or
delayed.  Each such assignment shall (unless it is to a Lender or an Affiliate
thereof or the Administrative Agent otherwise consents) be in an amount not less
than the lesser of (a) $5,000,000 or (b) the remaining amount of the assigning
Lender’s Commitment (calculated as at the date of such assignment).

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(b)Effect; Effective Date.  A Lender shall notify the Administrative Agent in
the event it wishes to transfer any of its Commitment.  Upon receipt of such
notice, the Administrative Agent shall verify that the beneficiaries of the
outstanding Letters of Credit will accept an amendment to or replacement of the
outstanding Letters of Credit to reflect such assignment and the change in the
“Commitments” as reflected in such outstanding Letters of Credit (a “Transfer
Amendment”).  The Administrative Agent shall advise the Lender whether such
Transfer Amendment is acceptable (the “Advisement Date”) and the Lender shall
advise the Administrative Agent of the proposed assignment date (which date
shall be not less than ten (10) Business Days after the Advisement Date).  Upon
(i) delivery to the Administrative Agent and the Borrower of a notice of
assignment, substantially in the form attached as Exhibit I to Exhibit B (a
“Notice of Assignment”), together with any consents required by Section 12.3(a),
(ii) payment of a $3,500 fee to the Administrative Agent by the assigning Lender
or the Purchaser for processing such assignment, the Administrative Agent shall
prepare the necessary Transfer Amendments and coordinate with the beneficiaries
a date to effectuate such Transfer Amendment.  Upon acceptance of the Transfer
Amendment by the beneficiaries, such assignment shall become effective.  The
Notice of Assignment shall contain a representation by the Purchaser to the
effect that none of the consideration used to make the purchase of the
participation interests in the Letters of Credit under the applicable assignment
agreement are “plan assets” as defined under ERISA and that the rights and
interests of the Purchaser in and under the Facility Documents will not be “plan
assets” under ERISA.  On and after the effective date of such assignment, such
Purchaser shall for all purposes be a Lender party to this Agreement and any
other Facility Document executed by or on behalf of the Lenders and shall have
all the rights and obligations of a Lender under the Facility Documents, to the
same extent as if it were an original party hereto, and no further consent or
action by the Borrower, the Lenders or the Administrative Agent shall be
required to release the transferor Lender with respect to the percentage of the
Aggregate Commitment, Tranche A Commitment and Tranche B Commitment and the
participation interests in Letters of Credit assigned to such Purchaser.

12.4Dissemination of Information.  The Borrower authorizes each Lender to
disclose to any Participant or Purchaser or any other Person acquiring an
interest in the Facility Documents by operation of law (each a “Transferee”) and
any prospective Transferee any and all information in such Lender’s possession
concerning the creditworthiness of the Borrower and its Subsidiaries; provided
that each Transferee and prospective Transferee agrees in writing to provisions
at least as restrictive as those in Section 9.11 of this Agreement.

12.5Tax Treatment.  If any interest in any Facility Document is transferred to
any Transferee which is organized under the laws of any jurisdiction other than
the United States or any State thereof, the transferor Lender shall cause such
Transferee, concurrently with the effectiveness of such transfer, to comply with
the provisions of Section 3.3(e).

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ARTICLE XIII

NOTICES

13.1Notices.  All notices, requests and other communications to any party
hereunder shall be in writing (including electronic transmission, facsimile
transmission or similar writing) and shall be given to such party: (a) in the
case of the Borrower or the Administrative Agent, at its address or facsimile
number set forth on the signature pages hereof, (b) in the case of any Lender,
at its address or facsimile number set forth below its signature hereto or (c)
in the case of any party, at such other address or facsimile number as such
party may hereafter specify for the purpose by notice to the Administrative
Agent and the Borrower in accordance with the provisions of this
Section 13.1.  Each such notice, request or other communication shall be
effective (i) if given by facsimile transmission, when transmitted to the
facsimile number specified in this Section and confirmation of receipt is
received, (ii) if given by mail, seventy-two (72) hours after such communication
is deposited in the mails with first class postage prepaid, addressed as
aforesaid, or (iii) if given by any other means, when delivered (or, in the case
of electronic transmission, received) at the address specified in this Section;
provided that notices to the Administrative Agent under Article II shall not be
effective until received.

13.2Change of Address.  The Borrower, the Administrative Agent and any Lender
may each change the address for service of notice upon it by a notice in writing
to the other parties hereto.

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ARTICLE XIV

COUNTERPARTS

This Agreement may be executed in any number of counterparts, all of which taken
together shall constitute one agreement, and any of the parties hereto may
execute this Agreement by signing any such counterpart.  Except as provided in
Section 4.1, this Agreement shall be effective when it has been executed by the
Borrower, the Administrative Agent and the Lenders.  Delivery of an executed
counterpart of a signature page of this Agreement by telecopy or in electronic
(i.e., “pdf” or “tif”) format shall be effective as delivery of a manually
executed counterpart of this Agreement.

ARTICLE XV

Acknowledgement and Consent to Bail-In of EEA Financial Institutions

Solely to the extent any Lender that is an EEA Financial Institution is a party
to this Agreement and notwithstanding anything to the contrary in any Facility
Document or in any other agreement, arrangement or understanding among any such
parties, each party hereto acknowledges that any liability of any Lender that is
an EEA Financial Institution arising under any Facility Document, to the extent
such liability is unsecured, may be subject to the write-down and conversion
powers of an EEA Resolution Authority and agrees and consents to, and
acknowledges and agrees to be bound by:

(a)the application of any Write-Down and Conversion Powers by an EEA Resolution
Authority to any such liabilities arising hereunder which may be payable to it
by any Lender or L/C Issuer that is an EEA Financial Institution; and

(b)the effects of any Bail-In Action on any such liability, including, if
applicable:

(i)      a reduction in full or in part or cancellation of any such liability;

(ii)     a conversion of all, or a portion of, such liability into shares or
other instruments of ownership in such EEA Financial Institution, its parent
undertaking, or a bridge institution that may be issued to it or otherwise
conferred on it, and that such shares or other instruments of ownership will be
accepted by it in lieu of any rights with respect to any such liability under
this Agreement or any other Facility Document; or

(iii)    the variation of the terms of such liability in connection with the
exercise of the write-down and conversion powers of any EEA Resolution
Authority.

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ARTICLE XVI

CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL

16.1CHOICE OF LAW.  THE FACILITY DOCUMENTS (OTHER THAN THOSE CONTAINING A
CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN ACCORDANCE WITH
AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARDS TO THE
CONFLICT OF LAW PROVISIONS THEREOF OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE
NEW YORK GENERAL OBLIGATIONS LAW, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE
TO NATIONAL BANKS.

16.2CONSENT TO JURISDICTION.  THE BORROWER HEREBY IRREVOCABLY SUBMITS TO THE
EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR STATE COURT SITTING IN
NEW YORK, NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO ANY
FACILITY DOCUMENTS AND THE BORROWER HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN
RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH
COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO
THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT
SUCH COURT IS AN INCONVENIENT FORUM.  NOTHING HEREIN SHALL LIMIT THE RIGHT OF
THE ADMINISTRATIVE AGENT, THE LETTER OF CREDIT AGENT OR ANY LENDER TO BRING
PROCEEDINGS AGAINST THE BORROWER IN THE COURTS OF ANY OTHER JURISDICTION.  ANY
JUDICIAL PROCEEDING BY THE BORROWER AGAINST THE ADMINISTRATIVE AGENT, THE LETTER
OF CREDIT AGENT OR ANY LENDER OR ANY AFFILIATE OF THE ADMINISTRATIVE AGENT, THE
LETTER OF CREDIT AGENT OR ANY LENDER INVOLVING, DIRECTLY OR INDIRECTLY, ANY
MATTER IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY FACILITY
DOCUMENT SHALL BE BROUGHT ONLY IN A COURT IN NEW YORK, NEW YORK.

16.3WAIVER OF JURY TRIAL.  THE BORROWER, THE ADMINISTRATIVE AGENT, THE LETTER OF
CREDIT AGENT AND EACH LENDER HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL
PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN
TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED
WITH ANY FACILITY DOCUMENT OR THE RELATIONSHIP ESTABLISHED THEREUNDER.

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16.4REAFFIRMATION .  This Agreement amends, restates and replaces in its
entirety the Existing Credit Agreement.  All rights, benefits, indebtedness,
interest, liabilities and obligations of the parties to the Existing Credit
Agreement are hereby amended, restated, replaced and superseded in their
entirety according to the terms and provisions set forth herein (except that any
provision of the Existing Credit Agreement that by its terms survives
termination of the Existing Credit Agreement shall continue in full force and
effect for the benefit of the applicable parties to the Existing Credit
Agreement).  All outstanding Obligations (as defined in the Existing Credit
Agreement)  under the Existing Credit Agreement shall, from and after the
Amendment Effective Date, be deemed outstanding under, and governed by this
Agreement and the Facility Documents.  This Agreement and any Facility Documents
executed in connection herewith do not effect a novation of the obligations of
the Borrower under the Existing Credit Agreement and the other Facility
Documents but are merely a restatement, and where applicable, an amendment to
the terms governing said obligations.  The Borrower hereby reaffirms each of the
Security Documents attached hereto as Exhibits E, F, J-1 and J-2.  All
references to the Credit Agreement in the Security Documents or in any other
document, instrument, agreement or writing shall be deemed to refer to this
Agreement..

 

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IN WITNESS WHEREOF, the Borrower, the Lenders, the Letter of Credit Agent and
the Administrative Agent have executed this Agreement as of the date first above
written.

 

THE NAVIGATORS GROUP, INC.

 

 

By:

___/s/___ Ciro M. DeFalco ________

Name:

Ciro M. DeFalco

Title:

Senior Vice President and Chief Financial Officer

 

Address:  

 

400 Atlantic Street Stamford, Connecticut 06901

 

Attn:

 

Ciro M. DeFalco

 

Telephone: (203) 905-6343
Fax:  (203) 658-1821
Email:  cdefalco@navg.com

 

Signature Page to Third Amended and Restated Funds
at Lloyd’s Letter of Credit Agreement

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ING BANK N.V., LONDON BRANCH,
individually, as Administrative Agent and Letter of Credit Agent

 

 

By:

___/s/ Nick Marchant ________

Name:

Nick Marchant

Title:

Director

 

By:

 

___/s/_ Alan Prosser________

Name:

Alan Prosser

Title:

Vice President

 

 

 

Address:  

 

ING Bank N.V., London Branch

8-10 Moorgate
London EC2R 6DA
United Kingdom

 

Attention:

 

Nick Marchant

 

Telephone:  +44 (0)20 7767 5920
Fax:  +44 (0)20 7767 7507
Email:  nick.marchant@uk.ing.com

 

Signature Page to Third Amended and Restated Funds
at Lloyd’s Letter of Credit Agreement

721957545 11052467

--------------------------------------------------------------------------------

 

 

JPMORGAN CHASE BANK, N.A.,

 

 

By:

___/s/ Hector Varona ________

Name:

Hector Varona

Title:

Executive Director

 

Address:  

 

270 Park Ave, 41st Floor
Suite NY1-K769
New York, NY 10017

 

Attention:

 

Hector Varona

 

Telephone:  (212) 622-6936
Fax:             (646) 534-2235
Email: hector.varona@jpmorgan.com

 

Signature Page to Third Amended and Restated Funds
at Lloyd’s Letter of Credit Agreement

721957545 11052467

--------------------------------------------------------------------------------

 

 

BARCLAYS BANK PLC

 

 

By:

___/s/ James Colano________

Name:

James Colano

Title:

Vice President

 

Address:  

 

745 7th Avenue
New York, NY, USA 10019

 

Attention:

 

Benjamin James

 

Telephone: (212) 526-0057
Email:  ben.x.james@barclays.com

  

 

 

Signature Page to Third Amended and Restated Funds
at Lloyd’s Letter of Credit Agreement

721957545 11052467

--------------------------------------------------------------------------------

 

SCHEDULE 1

COMMITMENTS

Lender

Tranche A Commitment

 

Tranche A Applicable Percentage

Tranche B Commitment

Tranche B Applicable Percentage

 

Aggregate Commitment Applicable Percentage

ING Bank N.V., London Branch

$66,668,000

  

47.62%

£28,572,000

47.62%

 

47.62%

JPMorgan Chase Bank N.A.

$36,666,000

 

26.19%

£15,714,000

26.19%

 

26.19%

Barclays Bank PLC

$36,666,000

 

26.19%

£15,714,000

26.19%

 

26.19%

 

 

 

 

 

 

 

 

TOTAL:

$140,000,000

 

100%

£60,000,000

100%

 

100%

 

 

 

Schedule 1

721957545 11052467

--------------------------------------------------------------------------------

 

SCHEDULE 1.1

ELIGIBLE COLLATERAL AND APPLICABLE ADVANCE RATES

 

Collateral Description

Advance Rate

 

Matching Currency (with respect to outstanding Letters of Credit)

Non-Matching Currency

(with respect to outstanding Letters of Credit)

Cash held with ING:

100%

90%

Cash held with a Financial Institution (subject to a Control Agreement):

95%

85%

US Dollar and/or Pound Time Deposits, CDs and Money Market Deposits:

 

Time deposits, certificates of deposit and money market deposits of any OECD
incorporated bank with a rating of at least (i) AA- from S&P and (ii) Aa3 from
Moody’s and maturing within two years from the date of determination.

95%

 

85%

US and/or UK Government Securities:

 

Securities issued or directly and fully guaranteed or insured by the United
States Government or any agency or instrumentality thereof (provided that the
full faith and credit of the United States is pledged in support thereof) or UK
Gilts, with maturities of:

 

less than five years from the date of determination

 

more than five years from the date of determination

 

 

 

 

 

 

 

90%

 

85%

 

 

 

 

 

 

 

80%

 

75%

Commercial paper rated A-1 by S&P or P1 or better by Moody’s  

85%

75%

 

 

 

 

 

 

 

Schedule 1.1

721957545 11052467

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SCHEDULE 1.2

EXISTING LETTERS OF CREDIT

 

Applicant

Reference No.

Amount

Tranche

Navigators Corporate Underwriting Ltd

DTGBLG404774

GBP 52,479,664

Tranche B Letter of Credit

Navigators Corporate Underwriting Ltd

DTGBLG404775

USD 95,000,000

Tranche A Letter of Credit

 

 

 

 

Schedule 1.2

721957545 11052467

--------------------------------------------------------------------------------

 

Schedule 5.9

 

Subsidiaries

 

 

 

Subsidiary

 

State of Incorporation

% ownership by the Borrower or a Subsidiary as otherwise indicated

Insurance

Company

Significant Subsidiary

 

 

 

 

 

Navigators Insurance Company

New York

100%

Yes

Yes

Navigators Specialty Insurance Company

New York

100% Navigators Insurance Company

Yes

 

Navigators Management Company, Inc.

New York

100%

 

 

Navigators International Insurance Company Ltd.

U.K.

100%

 

 

Navigators Corporate Underwriters Ltd.

U.K.

100% Navigators Holdings (UK) Ltd.

 

 

Navigators Management (UK) Ltd.

U.K.

100% Navigators Holdings (UK) Ltd.

 

 

Navigators Holdings (UK) Ltd.

U.K.

100%

 

 

Navigators Underwriting Agency Ltd.

U.K.

100% Navigators Holdings  (UK) Ltd.

 

 

Millennium Underwriting Ltd.

U.K.

100% Navigators Underwriting Agency Ltd.

 

 

Navigators Underwriting Ltd.

U.K.

100% Navigators Underwriting Agency Ltd.

 

 

Navigators NV

Belgium

100% Navigators Underwriting Agency Ltd.

 

 

NUAL AB

Sweden

100% Navigators Underwriting Agency Ltd.

 

 

Navigators A/S

Denmark

100% Navigators Holdings (UK) Ltd.

 

 

NIC Investments (Chile) SpA

Chile

100%

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

Schedule 5.22

 

Partnerships

 

None

 

 

 

--------------------------------------------------------------------------------

 

Schedule 5.23

 

 

Lines of Business

 

 

The Borrower and its Subsidiaries are active in the following lines of business:

 

Accident

Health

Reinsurance

Property

Commercial Multi Peril

Ocean Marine

Inland Marine

Other Liability

Commercial Auto Liability

Auto Physical Damage

Aircraft

Surety

Multiple Peril Crop

Burglary and Theft

Medical Professional Liability

 

 

 

--------------------------------------------------------------------------------

 

Schedule 6.16

 

Liens

 

 

UCC-1 in favor of Dell Financial Services L.L.C. (f/k/a Dell Financial Services
L.P.) filed in the Division of Corporations of the Delaware Secretary of State
on 9/18/01 (and continued on 8/25/06, 8/15/11 and 8/17/16) under File No.
11180202 covering leased equipment.

 

UCC-1 in favor of ING Bank N.V., London Branch filed in the Division of
Corporations of the Delaware Secretary of State on 11/23/15 under File No.
5555114 covering the collateral described therein.

 

 

 

--------------------------------------------------------------------------------

 

Schedule 6.21

 

 

Reinsurance Guidelines

 

 

●

Minimum A.M. Best rating of “A-” and

●

Policyholders’ surplus of (i) US $250 million or (ii) US $200 and part of a
group with combined statutory surplus of $350 million

●

Or, if not rated by A.M. Best, an equivalent rating from a major rating agency
along with the following:

 

○

Shareholder’s funds must be in excess of US $250 million

For purpose of this Credit Agreement, the following applies, net of any
collateral from the reinsurers:

1.

Reinsurers constituting the lessor of $10,000,000 or 25% of the credit risk on
any reinsurance program can be outside of the above guidelines.

1.

Any reinsurer, falling within the Reinsurance Guidelines, rated A- or below
cannot exceed an aggregate exposure across all programs of 66 2/3% of the
Consolidated Surplus of the Insurance Subsidiaries.

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

EXHIBIT A

COMPLIANCE CERTIFICATE

 

To:

The Lenders parties to the

 

Letter of Credit Agreement Described Below

This Compliance Certificate is furnished pursuant to that certain Third Amended
and Restated Funds at Lloyd’s Letter of Credit Agreement, dated as of November
7, 2016 (as amended, modified, renewed or extended from time to time, the
“Agreement”), among The Navigators Group, Inc. (the “Borrower”), the lenders
party thereto, and ING Bank N.V., London Branch, as Administrative Agent and
Letter of Credit Agent.  Unless otherwise defined herein, capitalized terms used
in this Compliance Certificate have the meanings ascribed thereto in the
Agreement.

THE UNDERSIGNED HEREBY CERTIFIES THAT:

1.I am the duly elected ___________ of the Borrower;

2.I have reviewed the terms of the Agreement and I have made, or have caused to
be made under my supervision, a detailed review of the transactions and
conditions of the Borrower and its Subsidiaries during the accounting period
covered by the attached financial statements;

3.The examinations described in paragraph 2 did not disclose, and I have no
knowledge of, the existence of any condition or event which constitutes a
Default or Unmatured Default during or at the time of the accounting period
covered by the attached financial statements or as of the date of this
Certificate, except as set forth below; and

4.Schedule I attached hereto sets forth financial data and computations
evidencing the Borrower’s compliance with certain covenants of the Agreement,
all of which data and computations are true, complete and correct.

Described below are the exceptions, if any, to paragraph 3 by listing, in
detail, the nature of the condition or event, the period during which it has
existed and the action which the Borrower has taken, is taking, or proposes to
take with respect to each such condition or event:

 

 

 

 

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

The foregoing certifications, together with the computations set forth in
Schedule I hereto and the financial statements delivered with this Certificate
in support hereof, are made and delivered this ___ day of ______, ____.

 

 

                                                                          

Name:

Title:

 

--------------------------------------------------------------------------------

 

SCHEDULE I TO COMPLIANCE CERTIFICATE

Compliance as of _________, ____ with
Provisions of Sections 6.14 and 6.23 of
the Agreement

Section 6.14 – Investments and Acquisitions

 

1.

Clause (d)

 

 

 

 

 

(a)

Maximum:

 

 

 

 

 

 

 

(i)

Total Investment Portfolio on the date of determination:

$__________

 

 

 

 

 

 

 

(ii)

20% of (a)(i):

$__________

 

 

 

 

 

 

(b)

Actual:

 

 

 

 

 

 

 

 

Investments in debt securities rated less than A- by S&P, A3 by Moody’s or
NAIC-1 by the NAIC but rated BBB- or better by S&P, Baa3 or better by Moody’s or
NAIC-2 or better by the NAIC on the date of determination (or downgraded from
such ratings within the last 180 days):

$__________

 

 

 

 

 

 

 

Is (a)(ii) greater than (b)?

Yes/No

 

 

 

 

 

2.

Clause (e)

 

 

 

 

 

 

 

(a)

Maximum:

 

$__________

 

 

 

 

 

 

 

(i)

Total Investment Portfolio on the date of determination:

$__________

 

 

 

 

 

 

 

(ii)

5% of (a)(i)

$__________

 

 

 

 

 

 

(b)

Actual:

 

$__________

 

 

 

 

 

 

 

Aggregate Investment in debt securities not satisfying standards set forth in
clause (b) or (d) of Section 6.14:

 

 

 

 

 

 

 

Is (a)(ii) greater than (b)

Yes/No

 

 

 

 

--------------------------------------------------------------------------------

 

3.

Clause (f)

 

 

 

 

 

 

 

(a)

Aggregate Investments in equity securities:

 

 

 

 

 

 

 

 

(i)

Maximum:

 

 

 

 

 

 

 

 

 

(A)

Total Investment Portfolio on the date of determination:

$__________

 

 

 

 

 

 

 

 

 

(B)

20% of (a)(i)(A):

$__________

 

 

 

 

 

 

 

 

(ii)

Actual:

 

 

 

 

 

 

 

 

 

 

Aggregate Investments by the Borrower in equity securities on the date of
determination:

$__________

 

 

 

 

 

 

 

 

Is (a)(i)(B) greater than (a)(ii)?

Yes/No

 

 

 

 

 

 

 

(b)

Individual Investments in equity securities:

 

 

 

 

 

 

 

 

 

(i)

Maximum:

 

 

 

 

 

 

 

 

 

 

(A)

100% of (a)(ii):

$__________

 

 

 

 

 

 

 

 

 

(B)

20% of (b)(i)(A):

$__________

 

 

 

 

 

 

 

 

(ii)

Actual:

 

 

 

 

 

 

 

 

 

 

Largest single equity securities investment by the Borrower and its Subsidiaries
on the date of determination:

$__________

 

 

 

 

 

 

 

 

Is (b)(i)(B) greater than (b)(ii)?

Yes/No

 

 

 

 

 

 

4.

Clause (g)

 

 

 

 

 

 

 

 

(a)

Maximum:

 

 

 

 

 

 

 

 

 

(i)

Total Investment Portfolio on the date of determination:

$__________

 

 

 

 

 

 

 

 

(ii)

1% of (a)(i):

 

 

 

 

 

 

 

 

(b)

Actual:

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

Other Investments on date of determination:

$__________

 

 

 

 

 

 

 

 

Is (a)(ii) greater than (b)?

Yes/No

 

 

 

 

 

 

5.

Clause (h)

 

 

 

 

 

 

 

 

(a)

Maximum:

 

 

 

 

 

 

 

 

 

(i)

Consolidated Net Worth of the Borrower and its Consolidated Subsidiaries on the
date of determination:

 

 

 

 

$__________

 

 

 

 

 

 

 

 

(ii)

5% of (a)(i):

 

 

 

 

 

 

 

 

(b)

Actual:

 

 

 

 

 

 

 

 

 

Amount of Acquisitions from beginning of Fiscal Year through date of
determination:

$__________

 

 

 

 

 

 

Is (a)(ii) greater than (b)?

Yes/No

 

 

 

 

 

--------------------------------------------------------------------------------

 

Section 6.23(a) – Minimum Consolidated Tangible Net Worth

 

 

 

 

 

 

 

Period:

Fiscal Quarter ended _____________, _______

 

 

 

 

 

 

 

1.

Minimum: $[]

$

 

 

 

 

 

 

2.

Actual:

 

 

 

 

 

 

 

 

Consolidated Tangible Net Worth (excluding the effect of unrealized gain or loss
under SFAS 115):

$__________

 

 

 

 

 

 

 

Is (2) greater than (1)?

Yes/No

 

 

 

 

 

 

Section 6.23(b) – Minimum Statutory Surplus of Navigators

 

 

 

 

 

 

 

Period:

Fiscal Quarter ended _____________, _______

 

 

 

 

 

 

 

1.

Minimum:  $[]

$

 

 

 

 

 

 

2.

Actual:

 

 

 

 

 

 

 

 

Statutory Surplus of Navigators:

$__________

 

 

 

 

 

 

 

Is (2) greater than (1)?

Yes/No

 

 

 

 

 

 

Section 6.23(c) – Leverage Ratio

 

 

 

 

 

 

 

1.

Maximum:

0.30:1.0

 

 

 

 

 

 

2.

Actual:

 

 

 

 

 

 

 

 

(a)

Consolidated Indebtedness of the Borrower and its Consolidated Subsidiaries
(excluding Indebtedness with respect to undrawn letters of credit) on date of
determination:

$__________

 

 

 

 

 

 

 

(b)

Consolidated Net Worth on date of determination:

$__________

 

 

 

 

 

 

 

(c)

(a) plus (b):

$__________

 

 

 

 

 

 

 

(d)

Ratio of (a) to (c):

     :1.0

 

 

 

 

 

 

 

Is the ratio of (a) to (c) less than 0.30:1?

Yes/No

 

--------------------------------------------------------------------------------

 

Section 6.23(d) – Minimum Risk-Based Capital1

 

 

 

 

 

 

 

1.

Minimum:

150%

 

 

 

 

 

 

2.

Actual:

 

 

 

 

 

 

 

 

(a)

Total Adjusted Capital on date of determination:

$__________

 

 

 

 

 

 

 

(b)

Company Action Level RBC on date of determination:

$__________

 

 

 

 

 

 

 

(c)

Ratio of (a) to (b) (expressed as a percentage):

______%

 

 

 

 

 

 

 

Is the ratio of (a) to (b) greater than 150%?

Yes/No

 

 

Section 6.23(e) – Adjusted Primary FAL for Year of Account 201[]

 

 

 

 

 

 

 

1.

Minimum:

 

 

 

 

 

 

 

 

(a)

Total Letter of Credit Obligations (using Dollar Equivalent of Tranche B Letter
of Credit Obligations)

$__________

 

 

 

 

 

 

 

(b)

40% of (1)(a)

 

 

 

 

 

 

 

2.

Actual:

 

 

 

 

 

 

 

 

(a)

Amount of Primary FAL provided by the Corporate Member on the date of
determination:

 

 

 

(1)  Cash/investment assets at Lloyd’s

$__________

 

 

(2)  Undistributed profits for closed years

$                    

 

 

(3)  Collateralized letters of credit available to cover losses in the Supported
Syndicate that will be utilized prior to the Letters of Credit

$__________

 

 

(4)  Sum of (a)(1) plus (a)(2) plus (a)(3)

$__________

 

(b)

NDS Deficiency as of ([insert most recent determination date]):

$__________

 

(c)

Solvency Surplus as of ([insert most recent determination date]:

$__________

 

(d)

Adjusted Primary FAL ((a)(4) minus ((b) plus (c))

$                    

 

 

 

 

 

 

 

Is (2)(d) greater than (1)(b)?

Yes/No

 

 

 

 

1 To be completed for each Significant Domestic Insurance Subsidiary.

 

--------------------------------------------------------------------------------

 

 

Section 6.23(f) – RDS for Year of Account 201[]

 

 

 

 

 

 

Maximum:  Highest net loss from a single Lloyd’s specified RDS shall not at any
time exceed 30% of the approved Syndicate Economic Capital Assessment (ECA) plus
profit for any Year of Account

30%

 

 

 

 

 

 Actual:

 

 

 

 

 

 

 (a)

Highest net loss from a single Lloyd’s specified RDS:

$__________

 

 

 

 

 

 (b)

Approved Syndicate Economic Capital Assessment plus profit for such Year of
Account:

$__________

 

 

 

 

 

 (c)

Ratio of (a) to (b) (expressed as a percentage):

______%

 

 

 

 

 

 

Is (c) less than 30%?

Yes/No

 

 

--------------------------------------------------------------------------------

 

EXHIBIT B

ASSIGNMENT AGREEMENT

This Assignment Agreement (this “Assignment Agreement”) between __________ (the
“Assignor”) and _____________ (the “Assignee”) is dated as of
________________.  The parties hereto agree as follows:

1.PRELIMINARY STATEMENT.  The Assignor is a party to a Credit Agreement (which,
as it may be amended, modified, renewed or extended from time to time is herein
called the “Credit Agreement”) described in Item 1 of Schedule 1 attached hereto
(“Schedule 1”).  Capitalized terms used herein and not otherwise defined herein
shall have the meanings attributed to them in the Credit Agreement.

2.ASSIGNMENT AND ASSUMPTION.  The Assignor hereby sells and assigns to the
Assignee, and the Assignee hereby purchases and assumes from the Assignor, an
interest in and to the Assignor’s rights and obligations under the Credit
Agreement such that after giving effect to such assignment the Assignee shall
have purchased pursuant to this Assignment Agreement the percentage interest
specified in Item 3 of Schedule 1 of all outstanding rights and obligations
under the Credit Agreement relating to the loans listed in Item 3 of Schedule 1
and the other Facility Documents.  

3.EFFECTIVE DATE.  The effective date of this Assignment Agreement (the
“Effective Date”) shall be the later of the date specified in Item 5 of Schedule
1 or the date the Administrative Agent advises that the beneficiaries of Letters
of Credit have accepted the amendments or replacements of the Letters of Credit
to reflect such assignment and a Notice of Assignment substantially in the form
of Exhibit I attached hereto has been delivered to the Administrative
Agent.  Such Notice of Assignment must include any consents required to be
delivered to the Administrative Agent by Section 12.3(a) of the Credit
Agreement.  In no event will the Effective Date occur if the payments required
to be made by the Assignee to the Assignor on the Effective Date under Sections
4 and 5 hereof are not made on the proposed Effective Date or if any other
condition precedent agreed to by the Assignor and the Assignee has not been
satisfied.  The Assignor will notify the Assignee of the proposed Effective Date
not later than the Business Day prior to the proposed Effective Date.  As of the
Effective Date, (i)the Assignee shall have the rights and obligations of a
Lender under the Facility Documents with respect to the rights and obligations
assigned to the Assignee hereunder and (ii)the Assignor shall relinquish its
rights and be released from its corresponding obligations under the Facility
Documents with respect to the rights and obligations assigned to the Assignee
hereunder.

4.PAYMENT OBLIGATIONS.  On and after the Effective Date, the Assignee shall be
entitled to receive from the Administrative Agent all payments of principal,
interest and fees with respect to the interest assigned hereby.  The Assignee
shall advance funds directly to the Administrative Agent with respect to all
reimbursement payments made on or after the Effective Date with respect to the
interest assigned hereby.  In the event that either party hereto receives any
payment to which the other party hereto is entitled under this Assignment
Agreement, then the party receiving such amount shall promptly remit it to the
other party hereto.

 

--------------------------------------------------------------------------------

 

5.FEES PAYABLE BY THE ASSIGNEE.  The Assignee agrees to pay the $3,500
processing fee required to be paid to the Administrative Agent in connection
with this Assignment Agreement.

6.REPRESENTATIONS OF THE ASSIGNOR; LIMITATIONS ON THE ASSIGNOR’S LIABILITY.  The
Assignor represents and warrants that it is the legal and beneficial owner of
the interest being assigned by it hereunder and that such interest is free and
clear of any adverse claim created by the Assignor.  It is understood and agreed
that the assignment and assumption hereunder are made without recourse to the
Assignor and that the Assignor makes no other representation or warranty of any
kind to the Assignee.  Neither the Assignor nor any of its officers, directors,
employees, agents or attorneys shall be responsible for (i)the due execution,
legality, validity, enforceability, genuineness, sufficiency or collectability
of any Facility Document, including without limitation, documents granting the
Assignor and the other Lenders a security interest in assets of the Borrower or
any guarantor, (ii)any representation, warranty or statement made in any
Facility Document or in connection with any of the Facility Documents, (iii)the
financial condition or creditworthiness of the Borrower or any guarantor,
(iv)the performance of or compliance with any of the terms or provisions of any
of the Facility Documents, (v)inspecting any of the Property, books or records
of the Borrower, (vi)the validity, enforceability, perfection, priority,
condition, value or sufficiency of any collateral securing or purporting to
secure the Reimbursement Obligations or (vii)any mistake, error of judgment, or
action taken or omitted to be taken in connection with the Letters of Credit or
the Facility Documents.

7.REPRESENTATIONS OF THE ASSIGNEE.  The Assignee (i)confirms that it has
received a copy of the Credit Agreement, together with copies of the financial
statements requested by the Assignee and such other documents and information as
it has deemed appropriate to make its own credit analysis and decision to enter
into this Assignment Agreement, (ii)agrees that it will, independently and with
reliance upon the Administrative Agent, the Assignor or any other Lender and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under the Facility Documents, (iii)appoints and authorizes the Administrative
Agent to take such action as agent on its behalf and to exercise such powers
under the Facility Documents as are delegated to the Administrative Agent by the
terms thereof, together with such powers as are reasonably incidental thereto,
(iv)agrees that it will perform in accordance with their terms all of the
obligations which by the terms of the Facility Documents are required to be
performed by it as a Lender, (v)agrees that its payment instructions and notice
instructions are as set forth in the attachment to Schedule 1, (vi)confirms that
none of the funds, monies, assets or other consideration being used to make the
purchase and assumption hereunder are “plan assets” as defined under ERISA and
that its rights, benefits and interests in and under the Facility Documents will
not be “plan assets” under ERISA, [and (vii)attaches the forms prescribed by the
Internal Revenue Service of the United States certifying that the Assignee is
entitled to receive payments under the Facility Documents without deduction or
withholding of any United States federal income taxes].

8.INDEMNITY.  The Assignee agrees to indemnify and hold the Assignor harmless
against any and all losses, costs and expenses (including, without limitation,
reasonable attorneys’ fees) and liabilities incurred by the Assignor in
connection with or arising in any

 

--------------------------------------------------------------------------------

 

manner from the Assignee’s non-performance of the obligations assumed under this
Assignment Agreement.

9.SUBSEQUENT ASSIGNMENTS.  After the Effective Date, the Assignee shall have the
right pursuant to Section 12.3(a) of the Credit Agreement to assign the rights
which are assigned to the Assignee hereunder to any entity or person, provided
that (i)any such subsequent assignment does not violate any of the terms and
conditions of the Facility Documents or any law, rule, regulation, order, writ,
judgment, injunction or decree and that any consent required under the terms of
the Facility Documents has been obtained and (ii)unless the prior written
consent of the Assignor is obtained, the Assignee is not hereby released from
its obligations to the Assignor hereunder, if any remain unsatisfied, including,
without limitation, its obligations under Sections 4, 5 and 8 hereof.

10.REDUCTIONS OF AGGREGATE COMMITMENT.  If any reduction in the Letter of Credit
Commitment occurs between the date of this Assignment Agreement and the
Effective Date, the percentage interest specified in Item 3 of Schedule 1 shall
remain the same, but the dollar amount purchased shall be recalculated based on
the reduced Letter of Credit Commitment, as the case may be.

11.ENTIRE AGREEMENT.  This Assignment Agreement and the attached Notice of
Assignment embody the entire agreement and understanding between the parties
hereto and supersede all prior agreements and understandings between the parties
hereto relating to the subject matter hereof.

12.GOVERNING LAW.  This Assignment Agreement shall be governed by the internal
law, and not the law of conflicts, of the State of New York, without regards to
the conflict of law provisions thereof other than Sections 5-1401 and 5-1402 of
the New York General Obligations Laws, but giving effect to Federal laws
applicable to national banks.

13.NOTICES.  Notices shall be given under this Assignment Agreement in the
manner set forth in the Credit Agreement.  For the purpose hereof, the addresses
of the parties hereto (until notice of a change is delivered) shall be the
address set forth in the attachment to Schedule 1.

[signature page follows]

 

 

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the parties hereto have executed this Assignment Agreement
by their duly authorized officers as of the date first above written.

 

[NAME OF ASSIGNOR]

 

 

 

By:

 

 

 

Title:

 

 

 

Address:

 

 

 

 

 

 

 

 

 

 

[NAME OF ASSIGNEE]

 

 

 

By:

 

 

 

Title:

 

 

 

Address:

 

 

 

 

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

SCHEDULE 1

TO ASSIGNMENT AGREEMENT

2.

Description and Date of Credit Agreement:

 

That certain Third Amended and Restated Funds at Lloyd’s Letter of Credit
Agreement, dated as of November 7, 2016, among the Navigators Group, Inc., the
financial institutions named therein, and ING Bank N.V., London Branch, as
Administrative Agent and Letter of Credit Agent.

3.

Date of Assignment Agreement:      ______________________

4.

Amounts (As of Date of Item 2 above):

 

 

 

Letter of Credit
Facility

 

(a)

Aggregate and Letter of Credit Commitment (total outstanding Letter of Credit
Obligations)* under Credit Agreement

$___________

 

(b)

Assignee’s Percentage of Facility purchased under the Assignment Agreement
(taken to five decimal places);

_____%

 

(c)

Amount of Assigned Share in Facility purchased under the Assignment Agreement:

$___________

5.

Total of Letter of Credit Participation Amount (outstanding Letter of Credit
Obligations)* purchased hereunder:

 

6.

Proposed Effective Date:

___________

*

If the Letter of Credit Commitment has been terminated, insert total outstanding
Letter of Credit Obligations in place of Letter of Credit Commitment or Letter
of Credit Participation Amount, as the case may be.

 

 

--------------------------------------------------------------------------------

 

Accepted and Agreed:

 

 

 

[NAME OF ASSIGNOR]

 

By:                                                      
Title:                                                   

[NAME OF ASSIGNEE]

 

By:                                                      
Title:                                                   

 

 

 

--------------------------------------------------------------------------------

 

ATTACHMENT TO SCHEDULE 1 to ASSIGNMENT AGREEMENT

 

ADMINISTRATIVE INFORMATION SHEET

 

Attach Assignor’s Administrative Information Sheet, which must
include notice addresses for the Assignor and the Assignee
(Sample form shown below)

 

ASSIGNOR INFORMATION

 

Contact:

Name:

 

Telephone

No.:

 

Fax No.:

 

 

 

 

Payment Information:

 

 

 

Name & ABA # of Destination Bank:

 

 

 

 

 

Account Name & Number for Wire Transfer:

 

 

 

 

 

Other Instructions:

 

 

 

 

 

 

Address for Notices for Assignee:

 

 

 

 

 

 

 

 

 

ASSIGNEE INFORMATION

Credit Contact:

 

 

Name:____________________________ Telephone No.: ____________________________

Fax No.:__________________________

 

 

 

 

 

--------------------------------------------------------------------------------

 

Key Operations Contacts:

Booking Installation:

 

 Booking Installation:

 

 

Name:

 

 Name:

 

 

Telephone No.:

 

Telephone No.:

 

 

Fax No.:

 

Fax No.:

 

 

Payment Information:

Name & ABA # of Destination Bank:

 

 

 

 

Account Name & Number for Wire Transfer:

 

 

 

 

Other Instructions:

 

 

 

 

Address for Notices for Assignor:

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

EXHIBIT I

TO ASSIGNMENT AGREEMENT

NOTICE
OF ASSIGNMENT

                ,          

 

To:

The Navigators Group, Inc.

 

ING Bank N.V., London Branch, as Administrative Agent and Letter of Credit Agent

From:

[NAME OF ASSIGNOR] (the “Assignor”)

 

[NAME OF ASSIGNEE] (the “Assignee”)

1.We refer to that certain Credit Agreement (the “Credit Agreement”) described
in Item 1 of Schedule 1 attached hereto (“Schedule 1”).  Capitalized terms used
herein and not otherwise defined herein shall have the meanings attributed to
them in the Credit Agreement.

2.This Notice of Assignment (the “Notice of Assignment”) is given and delivered
to [the Borrower and] the Administrative Agent pursuant to Section 12.3(b) of
the Credit Agreement.

3.The Assignor and the Assignee have entered into an Assignment Agreement, dated
as of ___________, _____ (the “Assignment Agreement”), pursuant to which, among
other things, the Assignor has sold, assigned, delegated and transferred to the
Assignee, and the Assignee has purchased, accepted and assumed from the Assignor
the percentage interest specified in Item 3 of Schedule 1 of all outstandings,
rights and obligations under the Credit Agreement relating to the facilities
listed in Item 3 of Schedule 1.  The Effective Date of the Assignment Agreement
shall be the later of the date specified in Item 5 of Schedule 1 or two Business
Days (or such shorter period as agreed to by the Administrative Agent) after
this Notice of Assignment and any consents and fees required by Sections 12.3(a)
and 12.3(b) of the Credit Agreement have been delivered to the Administrative
Agent; provided that the Effective Date shall not occur if any condition
precedent agreed to by the Assignor and the Assignee has not been satisfied.

4.The Assignor and the Assignee hereby give to the Borrower and the
Administrative Agent notice of the assignment and delegation referred to
herein.  The Assignor will confer with the Administrative Agent before the date
specified in Item 5 of Schedule 1 to determine if the Assignment Agreement will
become effective on such date pursuant to Section 3 hereof, and will confer with
the Administrative Agent to determine the Effective Date pursuant to Section 3
hereof if it occurs thereafter.  The Assignor shall notify the Administrative
Agent if the Assignment Agreement does not become effective on any proposed
Effective Date as a result of the failure to satisfy the conditions precedent
agreed to by the Assignor and the Assignee.  At the request of the
Administrative Agent, the Assignor will give the Administrative Agent written
confirmation of the satisfaction of the conditions precedent.

 

--------------------------------------------------------------------------------

 

5.The Assignor or the Assignee shall pay to the Administrative Agent on or
before the Effective Date the processing fee of $3,500 required by Section
12.3(b) of the Credit Agreement.

6.The Assignee advises the Administrative Agent that notice and payment
instructions are set forth in the attachment to Schedule 1.

7.The Assignee hereby represents and warrants that none of the funds, monies,
assets or other consideration being used to make the purchase pursuant to the
Assignment Agreement are “plan assets” as defined under ERISA and that its
rights, benefits, and interests in and under the Facility Documents will not be
“plan assets” under ERISA.

8.The Assignee authorizes each of the Administrative Agent and the Letter of
Credit Agent to act as its agent under the Facility Documents in accordance with
the terms thereof.  The Assignee acknowledges that the Administrative Agent has
no duty to supply information with respect to the Borrower or the Facility
Documents to the Assignee until the Assignee becomes a party to the Credit
Agreement.

9.Pursuant to Clause 16 (Security Trustee provisions) of the deed of charge
dated on or about 28 March 2011 and made between (amongst others) (1) the
Borrower as chargor and ING Bank, N.V. in its capacity as security trustee (the
“Deed of Charge”), the Assignee confirms its agreement to (a) irrevocably
appoint the Security Trustee (as that term is defined in the Credit Agreement)
as trustee under the Security Documents (as that term is defined in the Deed of
Charge) in its capacity as a Secured Party (as that term is defined in the Deed
of Charge) and (b) to be bound by the terms of the Deed of Charge as if it had
been a Secured Party from the date of the Deed of Charge.  By countersigning
this Assignment Agreement, the Security Trustee hereby accepts the appointment
by the Assignee as its trustee under the Deed of Charge and this paragraph shall
be governed by, and construed in accordance with, English law and shall take
effect and be binding on all parties notwithstanding that neither the Assignee
nor the Security Trustee have, as a matter of English law, executed this
Assignment Agreement as a deed.

[NAME OF ASSIGNOR]

 

[NAME OF ASSIGNEE]

 

By:________________________________

 

By:_________________________________

 

Title:______________________________

 

Title:_______________________________

 

--------------------------------------------------------------------------------

 

ACKNOWLEDGED AND CONSENTED TO BY ING Bank N.V., London Branch, as Administrative
Agent, Letter of Credit Agent and Security Trustee

 

 

 

ACKNOWLEDGED AND CONSENTED TO BY THE NAVIGATORS GROUP, INC.

 

 

 

By:________________________________

 

Title:______________________________

 

By:_________________________________

 

Title:_______________________________

 

[Attach photocopy of Schedule 1 to Assignment Agreement]

 

 

 

--------------------------------------------------------------------------------

 

EXHIBIT C

FORM OF APPLICATION

 

From:

 

To:  ING Bank N.V., London Branch

 

Dated:

 

Dear Sirs,

 

 

1.

This request to [issue a Letter of Credit][amend the stated amount of Letter of
Credit No. []] is made under, and is subject to the terms and conditions of,
that certain Third Amended and Restated Funds at Lloyd’s Letter of Credit
Agreement, dated as of November 7, 2016, as amended, among The Navigators Group,
Inc., a Delaware corporation, certain financial institutions and ING Bank N.V.,
London Branch, as Administrative Agent and Letter of Credit Agent (the “Credit
Agreement”).  In the event of a conflict between the terms and conditions of
this letter of credit application and those of the Credit Agreement, the terms
and conditions of the Credit Agreement shall govern.

 

2.

This notice is irrevocable.

 

3.

We hereby give you notice that, pursuant to the Credit Agreement and upon the
terms and subject to the conditions contained therein, we wish ING Bank N.V.,
London Branch to [issue/ amend] on our behalf a Letter of Credit as follows:

Applicant:

Beneficiary

Beneficiary address

[•]

[•]

[•]

[New] LOC Amount:

[•]

Utilization Date:

[•]

Commencement Date:

[•]

Currency

[•]

Expiry Date:

[•]

 

 

 

 

 

4.

We confirm that the conditions of Section 4.2(a) and (b) of the Credit Agreement
are fully complied with.

Yours faithfully

 

..................………..…..

Authorized Signatory

for and on behalf of

The Navigators Group, Inc.

 

 

--------------------------------------------------------------------------------

 

EXHIBIT D

 

FORM OF BORROWING BASE CERTIFICATE

To:

ING, N.V. London Branch,
as Administrative Agent
60 London Wall
London  EC2M 5TQ
United Kingdom

 

Re:

The Navigators Group, Inc.

 

Ladies and Gentlemen:

 

Please refer to that certain Third Amended and Restated Funds at Lloyd’s Letter
of Credit Agreement, dated as of November 7, 2016 (as amended, modified, renewed
or extended from time to time, the “Agreement”), among The Navigators Group,
Inc. (the “Borrower”), the lenders party thereto, and ING Bank N.V., London
Branch, as Administrative Agent and Letter of Credit Agent..  This Certificate,
together with supporting calculations attached hereto set forth in reasonable
detail, is delivered to you pursuant to the terms of the Credit
Agreement.  Capitalized terms used but not otherwise defined herein shall have
the same meanings herein as in the Credit Agreement.

We hereby certify and warrant to the Administrative Agent, Letter of Credit
Agent and the Lenders that at the close of business on ________, ____ (the
“Borrowing Base Calculation Date”), the Borrowing Base for the undersigned was
$__________ and the outstanding Letters of Credit Obligations was
$_________________

We hereby further certify and warrant to the Administrative Agent, the Letter of
Credit Agent and the Lenders that the information and computations contained
herein are true and correct in all material respects as of the Borrowing Base
Calculation Date.

IN WITNESS WHEREOF, the Borrower has caused this Certificate to be executed and
delivered by an authorized office this ____ day of ________, ____.

 

THE NAVIGATORS GROUP, INC.

 

 

By:

 

Title:

 

 

 

--------------------------------------------------------------------------------

 

SCHEDULE I TO BORROWING BASE CERTIFICATE

DATED AS OF:_____________

 

[FORM TO BE AGREED UPON BY ADMINISTRATIVE AGENT AND NAVIGATORS]

 

 

 

 

 

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

EXHIBIT E

 

SECURITY AGREEMENT

 

 

[OMITTED]

 

 

--------------------------------------------------------------------------------

 

EXHIBIT F

 

FIXED CHARGE

 

 

 

[OMITTED]

 

 

--------------------------------------------------------------------------------

 

EXHIBIT G

 

FORM OF LETTER OF CREDIT

 

 

To:    

The Society and Council of Lloyd's,

c/o The Manager, Market Services,

Fidentia House

Walter Burke Way

Chatham,

Kent  ME4 4RNDate:

 

 

Dear Sirs,

 

Irrevocable Standby Letter of Credit No. xxxxxxxxxxxx

 

Re:  xxxxxxxxxxxxx (the ‘Applicant’)

 

This Clean Irrevocable Standby Letter of Credit (the ‘Credit’) is issued by the
banks whose names are set out in Schedule 1 hereto (the ‘Issuing Lenders’, and
each an ‘Issuing Lender’) in favour of the Society of Lloyd’s (‘Lloyd’s’) on the
following terms:

 

1.

Subject to the terms hereof, the Issuing Lenders shall make payments within two
business days of demand on ING Bank N.V., London Branch (the 'Agent’) in
accordance with paragraph 4 below.

 

2.

Upon a demand being made by Lloyd’s pursuant to paragraph 4 below each Issuing
Lender shall pay that proportion of the amount demanded which is equal to the
proportion which its Commitment set out in Schedule 1 hereto bears to the
aggregate Commitments of all the Issuing Lenders set out in Schedule 1 hereto
provided that the obligations of the Issuing Lenders under this Credit shall be
several and no Issuing Lender shall be required to pay an amount exceeding its
Commitment set out in Schedule 1 hereto and the Issuing Lenders shall not be
obliged to make payments hereunder in aggregate exceeding a maximum amount of
xxxxx (figures and words). Any payment by an Issuing Lender hereunder shall be
made in US Dollars to Lloyd’s account specified in the demand made by Lloyd’s
pursuant to paragraph 4 below.

 

3.

This Credit is effective from xxxxxxxxxxx (the ‘Commencement Date’) and will
expire on the Final Expiration Date. This Credit shall remain in force until we
give you not less than four years notice in writing terminating the same on the
fourth anniversary of the Commencement Date or on any date subsequent thereto as
specified in such notice (the ‘Final Expiration Date’), our notice to be sent by
registered mail for the attention of the Manager, Market Services, at the above
address.

 

--------------------------------------------------------------------------------

 

4.

Subject to paragraph 3 above, the Issuing Lenders shall pay to Lloyd’s under
this Credit upon presentation of a demand by Lloyd’s on the Agent, ING Bank
N.V., 60 London Wall, London, EC2M 5TQ, marked ‘For the attention of Documentary
Credits/Agency Department’ substantially in the form set out in Schedule 2
hereto the amount specified therein (which amount shall not, when aggregated
with all the other amounts paid by the Issuing Lenders to Lloyd’s under this
Credit, exceed the maximum amount referred to in paragraph 2 above).

 

5.

The Agent has signed this Credit as agent for disclosed principals and
accordingly shall be under no obligation to Lloyd’s hereunder other than in its
capacity as an Issuing Bank.

 

6.

All charges are for the Applicants account.

 

7.

Subject to any contrary indication herein, this Credit is subject to the
International Standby Practices- ISP98 (1998 Publication International Chamber
of Commerce Publication No. 590).

 

8.

This Credit shall be governed by and interpreted in accordance with English Law
and the Issuing Lenders hereby irrevocably submit to the jurisdiction of the
High Court of Justice in England.

 

9.

Each of the Issuing Lenders engages with Lloyd’s that demands made under and in
compliance with the terms and conditions of this Credit shall be duly honoured
on presentation.

 

Yours faithfully

 

ING Bank N.V., London Branch, as Agent:

for and on behalf of

ING Bank N.V., London Branch

xxxxxxxxxxxxxxxx

 

For and on behalf of

ING Bank N.V., London Branch

 

Name:

Name:

Title:    Authorised signatory

Title:    Authorised signatory

 

 

--------------------------------------------------------------------------------

 

Attaching to and forming an integral part of Irrevocable Standby Letter of
Credit No. xxxxxxxxxx dated xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx.

 

 

 

Schedule 1

 

 

Issuing Lenders Commitments

 

Name and address of Issuing Lender

Commitment (USD)

 

 

Total Value

USD

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

Attaching to and forming an integral part of Irrevocable Standby Letter of
Credit No. xxxxxxxxxxx dated xxxxxxxxxxxx.

 

 

 

Schedule 2

 

 

Form of Demand

[on Lloyd’s letterhead]

 

 

Dear Sir/Madam,

 

The Society of Lloyd’s

Trustee of

Letter of credit No. xxxxxxxxxxxx dated xxxxxxxxxxxxx

 

 

With reference to the above, we enclose for your attention a Bill of Exchange,
together with the respective Letter of Credit. Payment should be made by way of
CHAPS. The account details are as follows:

 

National Westminster Bank Plc

City of London Office

P.O. Box 12258

Sort Code 60.00.01

Account 13637444

1 Princes Street

 

London EC2R 8AP

 

 

Please quote Member Code:

 

Yours faithfully

 

For Manager

Market Services

 

By:

 

Name:

 

Title:                                                                                                                

 

 

--------------------------------------------------------------------------------

 

Attaching to and forming an integral part of Irrevocable Standby Letter of
Credit No. xxxxxxxxxxx dated xxxxxxxxxxxxxxxxxxxxxxx.

 

 

Schedule 2                              

Page 2                              

 

 

 

Your ref:

Our ref:MEM/   /   /   /C911f

Extn:

 

 

 

BILL OF EXCHANGE

The Society of Lloyd’s

 

Trustee of

Letter of Credit No xxxxxxxxxxxxxx dated xxxxxxxxxxxxxxxxx.

 

 

Please pay in accordance with the terms of the Letter of Credit to our order the
amount of USD…….

 

For and on behalf of

 

Authorised Signatory

Market Services

 

 

 

To:

ING Bank N.V.,

 

London Branch,

 

as the Agent

 

 

 

--------------------------------------------------------------------------------

 

EXHIBIT H

 

FORM OF LLOYD’S COMFORT LETTER

 

 

[On Lloyd’s Letterhead]

Letter of Comfort

Our ref

Your ref

Date[***]

To:

The Navigators Group, Inc. (the “Company”)

ING Bank N.V., London Branch (the “Agent”)

For and on behalf of ING Bank N.V., London Branch (the “Issuer”)

 

Dear Sirs

Funds at Lloyd’s – Navigators Corporate Underwriters Ltd (the “Corporate
Member”)

I understand that the Corporate Member is about to procure the provision to
Lloyd’s of bank letters of credit from the Issuer (the “Banks’ Letters of
Credit”) to form part of the Corporate Member’s Funds at Lloyd’s in respect of
their participation in Syndicate 1221 for the 2017 and 2018 underwriting years
of account (including any prior open years of account for the Syndicate). You
have asked whether, in the event of monies having to be applied out of the
Corporate Member’s Funds at Lloyd’s, the Banks’ Letters of Credit and other
Funds at Lloyd’s of the Corporate Member may be drawn down in a pre-determined
order whereby any draw down on the Banks’ Letters of Credit would not be made
until such time as all other Funds at Lloyd’s supporting the underwriting of the
Corporate Member have been exhausted.

As you are aware, the Banks’ Letters of Credit are held by Lloyd’s in its
capacity as trustee under the terms of the Security & Trust Deed (substantially
in the form (STD GEN/10)) entered into by the Corporate Member. Any decision to
draw down on any Funds at Lloyd’s involves an exercise of discretion in the
light of the circumstances prevailing at the relevant time, and thus no binding
undertaking can be given now.

 

--------------------------------------------------------------------------------

 

However, I can confirm that at the time of considering the drawdown of the
Corporate Member’s Funds at Lloyd’s, Lloyd’s would take into account the request
that the Banks’ Letters of Credit shall be drawn down only after all other Funds
at Lloyd’s supporting the underwriting of Corporate Member have been exhausted.

Yours faithfully,

 

_______________________

Signed for The Society of Lloyd’s

By:

Authorised Signatory

 

 

 

 

 

--------------------------------------------------------------------------------

 

EXHIBIT I

 

FORM OF CONFIRMATION OF PRIMARY FAL

 

[On the Managing Agent’s letterhead]

 

 

To:

ING Bank N.V., London Branch,

 

as Administrative Agent

 

60 London Wall

 

London EC2M 5TQ

 

Attention:  Nick Marchant

 

Re: The Navigators Group, Inc.

 

Dated:[●]

 

 

 

Ladies and Gentlemen:

 

 

The Navigators Group, Inc. – Confirmation of Primary Funds at Lloyd's

1.

We understand that pursuant to a Third Amended and Restated Funds at Lloyd’s
Letter of Credit Agreement (the “LOC Agreement”; capitalized terms used herein
without definition have the meaning given such terms in the LOC Agreement),
dated as of November 7, 2016, among the Navigators Group, Inc., the financial
institutions named therein, and ING Bank N.V., London Branch, as Administrative
Agent and Letter of Credit Agent, you as agent for and on behalf of yourself, JP
Morgan Chase Bank, N.A. and Barclays Bank plc, have agreed to issue standby
letters of credit in favour of Lloyd's (the “ING FAL”) to support the
underwriting capacity of Navigators Corporate Underwriters Limited (the
“Corporate Member”), as a member of Lloyd's Syndicate 1221 for the 2017 and 2018
underwriting years of account (including any prior open years of account of such
Syndicate).

 

2.

We confirm to you that, as of the date of this letter, the following Primary FAL
(in the form and amounts specified below) is available in respect of both
underwriting years of account for application (excluding any ING FAL):

 

a)

[•];

 

b)

[•]; and  

 

c)

[•]

For the avoidance of doubt, the Primary FAL referred to above shall not include
any sum covering the solvency deficit of the Corporate Member in its individual
open year of account which is reported in its solvency statements prepared by
Lloyd's.

 

--------------------------------------------------------------------------------

 

3.

We confirm that:

 

(a)

it is our understanding that the Primary FAL set out in paragraph 2 above will
be applied by Lloyd's in full prior to any application of the ING FAL; and

 

(b)

we will not do or permit to be done anything incompatible or inconsistent with
the order of priority set out in paragraph (a) above.

 

4.

We acknowledge that it is a requirement under paragraph 4.1(a)(ix) of the LOC
Agreement that we issue this written confirmation.

 

5.

This letter and any non-contractual obligations arising out of or in connection
with it are governed by English law.

 

 

 

Yours faithfully,

For and on behalf of

Navigators Underwriting Agency Limited

 

 

--------------------------------------------------------------------------------

 

EXHIBIT J-1

DEPOSIT ACCOUNT CONTROL AGREEMENT

 

[OMITTED]

 

 

--------------------------------------------------------------------------------

 

 

EXHIBIT J-2

SECURITIES ACCOUNT CONTROL AGREEMENT

[OMITTED]