BANK OF
AMERICA, N.A.
 
WACHOVIA BANK, NATIONAL ASSOCIATION  
RBC BANK (USA)  
SUNTRUST BANK

THIRD AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

This THIRD AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT (“Agreement”) is
entered into as of the 2nd day of May, 2008, by and among BANK OF AMERICA, N.A.,
WACHOVIA BANK, NATIONAL ASSOCIATION, RBC BANK (USA) (formerly known as RBC
CENTURA BANK), SUNTRUST BANK and PORTFOLIO RECOVERY ASSOCIATES, INC., a Delaware
corporation (“Borrower”).

RECITALS

Borrower, Bank of America, N.A. (“BOA”), Wachovia Bank, National Association
(“Wachovia”) and RBC Centura Bank (now known as RBC Bank (USA)) (“RBC”) entered
into a Second Amended and Restated Loan and Security Agreement on May 4, 2007,
which was amended by a Loan Document Modification Agreement dated October 26,
2007 and by a Second Loan Document Modification Agreement dated March 18, 2008
and the parties thereto now desire to add SunTrust Bank (“SunTrust”) as a party
thereto as one of the “Banks”, and by becoming a party hereto as one of the
Banks, SunTrust will pay to each of BOA, Wachovia and RBC an amount equal to
their respective Borrowing Percentages of SunTrust’s Borrowing Percentage of
amounts outstanding hereunder as of the date of execution of this Agreement. In
addition to adding SunTrust as a Bank, the parties hereto desire to increase the
Revolving Facility and modify certain terms. Borrower wishes to continue to
obtain credit from time to time from the Banks, and the Banks desire to extend
credit to Borrower for use by Borrower in its business. This Agreement sets
forth the terms and conditions on which the Banks will advance credit to
Borrower.

AGREEMENT

The parties agree as follows:

1. DEFINITIONS AND INTERPRETATION.

1.1 Definitions. Capitalized terms used herein and not defined in the specific
section in which they are used shall have the meanings assigned to such terms in
. Terms not defined in a specific section or in Exhibit A which are defined in
the Code shall have the meanings assigned to such terms in the Code.

1.2 Accounting Terms. All accounting terms not specifically defined in shall be
construed in accordance with GAAP and all calculations shall be made in
accordance with GAAP. The term “financial statements” shall include the
accompanying notes and schedules.

1.3 Use and Application of Terms. To the end of achieving the full realization
by the Banks of their rights and remedies under this Agreement, including
payment in full of the Obligations, in using and applying the various terms,
provisions and conditions in this Agreement, the following shall apply: (i) the
terms “hereby”, “hereof”, “herein”, “hereunder” and any similar words refer to
this Agreement; (ii) words in the masculine gender mean and include correlative
words of the feminine and neuter genders and words importing the singular
numbered meaning include the plural number, and vice versa; (iii) words
importing persons include firms, companies, associations, general partnerships,
limited partnerships, limited liability partnerships, limited liability limited
partnerships, limited liability companies, trusts, business trusts, corporations
and other registered or legal organizations, including public and quasi-public
bodies, as well as individuals; (iv) the use of the terms “including” or
“included in”, or the use of examples generally, are not intended to be
limiting, but shall mean, without limitation, the examples provided and others
that are not listed, whether similar or dissimilar; (v) the phrase “costs and
expenses”, or variations thereof, shall include, without limitation, the
reasonable fees of the following persons: attorneys, legal assistants,
accountants, engineers, surveyors, appraisers and other professionals and
service providers; (vi) as the context requires, the word “and” may have a joint
meaning or a several meaning and the word “or” may have an inclusive meaning or
an exclusive meaning; (vii) this Agreement shall not be applied, interpreted and
construed more strictly against a person because that person or that person’s
attorney drafted this Agreement; and (viii) wherever possible each provision of
this Agreement and the other Loan Documents shall be interpreted and applied in
such manner as to be effective and valid under applicable Requirements of Law,
but if any provision of this Agreement or any of the other Loan Documents shall
be prohibited or invalid under such law, or the application thereof shall be
prohibited or invalid under such law, such provision shall be ineffective to the
extent of such prohibition or invalidity without invalidating the remainder of
such provision or the remaining provisions, or the application thereof shall be
in a manner and to an extent permissible under applicable Requirements of Law.

2. CREDIT EXTENSIONS.

2.1 (a) Credit Extensions. Subject to and upon the terms and conditions of this
Agreement and provided that no Event of Default has occurred and is continuing,
the Banks shall make available to Borrower the Revolving Facility with a
non-revolving sublimit and Credit Extensions thereunder generally described as
follows: a revolving line of credit in an amount equal to Three Hundred Forty
Million Dollars ($340,000,000) (the “Revolving Facility”) with a One Hundred
Million Dollar ($100,000,000) sublimit for non-revolving fixed rate advances
(the “Non-Revolving Sublimit”) provided, however, in no event shall the
aggregate amount outstanding under the Revolving Facility and the Non-Revolving
Sublimit ever exceed thirty percent (30%) of Borrower’s and Portfolio Recovery
Associates, L.L.C.’s Estimated Remaining Collections of all Eligible Asset
Pools. The Revolving Facility and the Non-Revolving Sublimit and related Credit
Extensions which are to be made available to Borrower are more fully described
below in this Section 2.1 and unless otherwise provided in this Agreement, the
Revolving Facility and the Non-Revolving Sublimit and related Credit Extensions
shall be evidenced by one or more Promissory Notes from Borrower to the Banks
and the Credit Extensions shall bear interest, and the Credit Extensions, the
interest and the fees, charges, premiums and costs and expenses associated
therewith, shall be repayable in accordance with the terms of such Promissory
Notes and this Agreement.

(b) Revolving Facility. At any time from the date hereof through the Revolver
Maturity Date, Borrower may request and the Banks agree to make Advances under
the Revolving Facility to Borrower to finance (i) working capital needs for its
business, (ii) payments of dividends, (iii) repurchases of capital stock of
Portfolio Recovery Associates, Inc., and (iv) acquisitions permitted by
Section 7.3 – and not for any other purpose. The aggregate amount of outstanding
Advances under the Revolving Facility shall not exceed at any time the Committed
Line less Advances made under the Non-Revolving Sublimit. If no Event of Default
has occurred and is continuing, amounts borrowed under the Revolving Facility
may be repaid and reborrowed at any time prior to the Revolver Maturity Date.

(c) Non-Revolving Sublimit. At any time from the date hereof through the
Revolver Maturity Date, Advances up to the amount of the Non-Revolving Sublimit,
each in integral increments of Ten Million Dollars($10,000,000), shall be
available to be advanced to Borrower on a non-revolving basis, and the proceeds
of Advances under the Non-Revolving Sublimit shall be used by Borrower to
finance (i) working capital needs for its business, (ii) payment of dividends,
(iii) repurchases of capital stock of Portfolio Recovery Associates, Inc., and
(iv) acquisitions permitted by Section 7.3, and not for any other purpose.
Advances made under the Non-Revolving Sublimit shall reduce availability under
the Revolving Facility. Borrower may also convert amounts outstanding under the
Revolving Facility to Advances under the Non-Revolving Sublimit by giving
written notice of such conversion to each Bank. Such conversions may only be
made in integral increments of Ten Million Dollars ($10,000,000). If no Event of
Default has occurred and is continuing, each Advance made under the
Non-Revolving Sublimit and all amounts owed in connection therewith shall be
repaid on or before the Non-Revolving Maturity Date for such Advance.

2.2 Credit Extensions – Disbursements. (a) Whenever Borrower desires an Advance,
Borrower shall notify each Bank by facsimile transmission or telephone no later
than 10:00 a.m. eastern time, on the Business Day on which Borrower desires the
Advance to be made. Each notification by facsimile transmission shall include
the information requested on the form attached as Exhibit B, shall be submitted
substantially in the form of Exhibit B and shall be signed by a Responsible
Officer or a designee thereof. Each notification by telephone shall include the
information requested on the form attached as Exhibit B and each notification by
telephone shall be followed within one Business Day by a facsimile transmission
which meets the criteria regarding a facsimile transmission. Each Bank shall be
entitled to rely on any telephonic notice given by a person who such Bank
reasonably believes to be a Responsible Officer or a designee thereof. No Bank
shall have any liability to Borrower or any other person for its failure to make
an Advance on the date requested by Borrower, unless such failure is the result
of willful misconduct or gross negligence of such Bank; and if such Bank’s
failure is a result of willful misconduct or gross negligence, its liability
shall be limited to actual damages only – no Bank shall be liable for indirect,
speculative, consequential or punitive damages and losses. Where Borrower
maintains its operating deposit account with a Bank, such Bank will credit the
amount of the Advances made by such Bank to such account.

(b) Borrower shall use its best efforts to ensure that each request for an
Advance is made of all Banks, in accordance with each Bank’s Borrowing
Percentage at the time, and all payments and pre-payments to the Banks shall be
made Pro Rata.

2.3 Overadvances. If, at any time, the aggregate amount of the outstanding
principal under the Revolving Facility and the Non-Revolving Sublimit exceeds
the Committed Line, the Borrower shall immediately pay to each Bank, in cash,
its Pro Rata portion of such excess.

2.4 Charging of Payments. A Bank may, after the occurrence of an Event of
Default, at its option, set-off and apply to the Obligations and otherwise
exercise its rights of recoupment as to any and all (i) balances and deposits of
Borrower held by such Bank, (ii) indebtedness and other obligations at any time
owing to or for the credit or the account of Borrower by such Bank and by any of
such Bank’s Affiliates. A Bank may, after notice to Borrower at its option, also
charge all payments required to be made on any of the Obligations against the
Revolving Facility. If a Bank charges the aforementioned payments against the
Revolving Facility, the same shall be deemed an Advance thereunder and the
amount of the Advance shall thereafter accrue interest at the interest rate
applicable from time to time to Advances; and if a Bank charges payments as
aforesaid, such Bank may, in its discretion, limit, declare a moratorium on and
terminate Borrower’s right under this Agreement to receive additional Advances,
after notice to Borrower and each other Bank, and a Bank’s decision to do one of
the foregoing does not prevent it from later doing any one or more of the
others.

2.5 Fees. In addition to the other fees, charges, costs and expenses required to
be paid by Borrower under this Agreement and the other Loan Documents, Borrower
shall pay to the Banks the fees, charges, costs and expenses set forth in this
Section 2.5.

(a) Unused Facility Fee. Borrower shall pay to each Bank an annualized
three-tenths of one percent (0.30%) Unused Facility Fee, which shall be payable
monthly on the first day of each month, and which shall be based upon the
average amount of the Unused Facility for the preceding calendar month for each
Bank relative to each such Bank’s Commitment. The average amount of the Unused
Facility for any partial month shall be calculated based on the unused amounts
in such partial month.

(b) Bank Expenses. On the Closing Date, Borrower shall pay to the Banks all
reasonable Bank Expenses incurred through the Closing Date and shall pay, as and
when demand is so made by a Bank to Borrower, all reasonable Bank Expenses
incurred relating to completion, after the Closing Date, of matters related to
closing of this Agreement. Borrower shall be responsible for its own fees and
expenses, including its legal fees.

(c) Renewal Fee. On the Closing Date, Borrower shall pay to each Bank a renewal
fee in the amount of six (6) basis points of its Commitment.

2.6 Documentary and Intangible Taxes; Additional Costs. To the extent not
prohibited by law and notwithstanding who is liable for payment of the taxes and
fees, Borrower shall pay, on a Bank’s demand, all intangible personal property
taxes, documentary stamp taxes, excise taxes and other similar taxes assessed,
charged and required to be paid in connection with the Credit Extensions and any
extension, renewal and modification thereof, or assessed, charged and required
to be paid in connection with this Agreement, any of the other Loan Documents
and any extension, renewal and modification of any of the foregoing. If, with
respect to this Agreement or the transactions hereunder, any Requirement of Law
(i) subjects a Bank to any tax (except federal, state and local income taxes on
the overall net income of a Bank), (ii) imposes, modifies and deems applicable
any deposit insurance, reserve, special deposit or similar requirement against
assets held by, or deposits in, or loans by a Bank, or (iii) imposes upon a Bank
any other condition, and the result of any of the foregoing is to increase the
cost to such Bank, reduce the income receivable by such Bank or impose any
expense upon such Bank with respect to the Obligations, Borrower agrees to pay
to such Bank the amount of such increase in cost, reduction in income or
additional expense within thirty (30) days following presentation by such Bank
of a statement of the amount and setting forth such Bank’s calculation thereof,
all in reasonable detail, which statement shall be deemed true and correct
absent manifest error.

2.7 Term of Agreement. This Agreement shall become effective on the Closing Date
and shall continue in full force and effect until the payment in full of all of
the Obligations. Notwithstanding the foregoing, each Bank shall have the right
to limit, declare a moratorium on and terminate its obligation to make Credit
Extensions under this Agreement immediately and without notice to Borrower (but
with immediate written notice to each other Bank) upon the occurrence and during
the continuance of an Event of Default; and such action by a Bank shall not
constitute a termination of this Agreement, shall not constitute a termination
of Borrower’s obligations under this Agreement or the other Loan Documents and
shall not adversely affect or impair any Bank’s security interests in the
Collateral. A Bank’s decision to do any one of the foregoing (i.e., limit,
declare a moratorium and terminate its obligations to make Credit Extensions)
shall not prevent it from exercising any one or more of the other options
available to it at any other time. The Banks shall review the Revolver Maturity
Date annually, and shall notify Borrower (pursuant to a notice substantially in
the form of the Notice of Extension attached hereto) not less than sixty
(60) days before each anniversary of this Agreement only if they intend to
extend the Revolver Maturity Date to a date which is one year beyond the then
current Revolver Maturity Date.

3. CONDITIONS OF CREDIT EXTENSIONS.

3.1 Conditions Precedent to Initial Credit Extension. The obligation of any Bank
to make the initial Credit Extension is subject to the condition precedent that
all of the conditions and requirements set forth in this Section 3.1 and
Section 3.2 have been satisfied and completed, or the satisfaction and
completion thereof waived by the Banks. If all of the conditions are not met to
all Banks’ satisfaction, or the completion thereof waived by each Bank, each
Bank may, at its option, (i) withhold disbursement until the same are met,
(ii) close and require that any unsatisfied conditions be satisfied as a
condition subsequent to closing within such period of time as may be designated
by such Bank or (iii) terminate its obligation to make any Credit Extension and
recover from Borrower all Bank Expenses incurred by such Bank in connection with
its preparations for making the Credit Extensions, together with the fees and
other costs and expenses required to be paid by Borrower under the Commitment. A
waiver by the Banks of a condition must be in writing to be effective and a
waiver as to one or more conditions shall not constitute a waiver as to other
conditions and shall not establish a “course of dealing or practice” that would
require a waiver of the same or a similar condition at some later time. A waiver
shall not be deemed effective against the rights of a Bank unless expressly
given by such Bank.

(a) Loan Documents, etc. Each Bank shall have received an original of this
Agreement, duly executed by Borrower and any other persons who are parties
hereto, and all of the information, certifications, certificates,
authorizations, consents, approvals, title and other insurance policies and
commitments, financial statements, financing statements, agreements, documents
and records as the Banks and their counsel may deem reasonably necessary or
appropriate.

(b) Payment of Fees. Each Bank shall have received payment of the fees and Bank
Expenses then due, as specified in Section 2.

(c) No Event of Default. No Event of Default shall have occurred and be
continuing as of the Closing Date, or after giving effect to the initial Credit
Extension to be made at or immediately after closing.

(d) Additional Matters. All other legal and non-legal matters as any Bank or its
counsel deems reasonably necessary or appropriate to be satisfied, completed and
received prior to the initial Credit Extension shall be satisfied, completed and
received in form and substance satisfactory to such Bank and its counsel; and
the Bank’s counsel shall have received duly executed counterpart originals, or
certified or other such copies of all records as such counsel may reasonably
request.

3.2 Conditions Precedent to All Credit Extensions. The obligation of any Bank to
make each Credit Extension, including the initial Credit Extension, is further
subject to all of the conditions and requirements set forth in this Section 3.2
being satisfied and completed, or the satisfaction and completion thereof waived
by each Bank.

(a) Loan Payment/Advance Request Form. Each Bank shall have received, as and
when required, a completed Loan Payment/Advance Request Form in the form of
Exhibit B attached hereto.

(b) Representations and Warranties; No Event of Default. The representations and
warranties referenced in Section 5 and in the other Loan Documents shall be true
and correct on and as of the date of such Loan Payment/Advance Request Form and
on the effective date of each Credit Extension as though made at and as of each
such date, and no Event of Default shall have occurred and be continuing, or
would exist after giving effect to such Credit Extension (provided, however,
that those representations and warranties expressly referring to another date
shall be true, correct and complete as of such date). The making of each Credit
Extension shall be deemed to be a representation and warranty by Borrower on the
date of such Credit Extension as to the accuracy of the facts referred to in
this subsection.

(c) Audit of Collateral. At any Bank’s election, such Bank shall have received
from Borrower an internally prepared report of the Collateral (including,
without limitation, Borrower’s and Portfolio Recovery Associates, L.L.C.’s Asset
Pools), in a format consistent with the form included in Borrower’s quarterly
and annual public filings. In the event Borrower’s accountants make material
corrections or modifications to the report presented to them for review,
Borrower shall immediately inform each Bank of such corrections or
modifications.

4. CREATION OF SECURITY INTEREST.

4.1 Grant of Security Interest. Borrower grants and pledges to the Banks a
continuing security interest in all presently existing and hereafter acquired or
arising Collateral to secure the prompt repayment of any and all Obligations and
to secure the prompt performance by Borrower of each of its covenants, duties
and obligations under the Loan Documents. Except as set forth in the Schedule,
such security interest constitutes a valid, first priority security interest in
the presently existing Collateral, and will constitute a valid, first priority
security interest in Collateral acquired or arising after the date hereof.
Notwithstanding any limitation of, moratorium on or termination of any Bank’s
obligation to make Credit Extensions under this Agreement, the Banks’ security
interest on the Collateral shall remain in full force and effect for so long as
any Obligations are outstanding.

4.2 Delivery of Additional Documentation Required. (a) To the extent that such
documentation is physically available to Borrower; Borrower shall from time to
time execute and deliver to any Bank, at the request of such Bank, all
Negotiable Collateral, all Financing Statements and other documents and records
that such Bank may request, in form and substance satisfactory to such Bank and
its counsel, to perfect and continue perfected such Bank’s security interests in
the Collateral and in order to fully consummate all of the transactions
contemplated under the Loan Documents. Borrower hereby consents to the filing by
any Bank of Financing Statements and such other instruments and documents in any
jurisdictions or locations deemed advisable or necessary in such Bank’s
discretion to preserve, protect and perfect such Bank’s security interest and
rights in the Collateral. Borrower further consents to and ratifies the filing
of such Financing Statements and other instruments and documents prior to the
Closing Date. If Borrower has executed and delivered to any Bank a separate
security agreement or agreements in connection with any or all of the
Obligations, that security agreement or those security agreements and the
security interests created therein shall be in addition to and not in
substitution of this Agreement and the security interests created hereby, and
this Agreement shall be in addition to and not in substitution of the other
security agreement or agreements and the security interests created thereby, but
shall be subject at all times to the Intercreditor Agreement. In all cases this
Agreement and the aforesaid security agreement or agreements, as well as all
other evidences or records of any and all of the Obligations and agreements of
Borrower, the Banks and other persons who may be obligated on any of the
Obligations, shall be applied and enforced in harmony with and in conjunction
with each other to the end that each Bank realizes fully upon its rights and
remedies in each and the Liens created by each; and, to the extent conflicts
exist between this Agreement and the other security agreements and records, they
shall be resolved in favor of the Banks for the purpose of achieving the full
realization of the Banks’ collective rights and remedies thereunder and the
Liens as aforesaid.

(b) Borrower shall take reasonable steps to provide that computer or other
records representing or evidencing an Account contain (by way of stamp, legend
or other method satisfactory to the Banks) the following language: “Pledged to
Bank of America, Wachovia Bank, RBC Bank (USA) and SunTrust Bank as Collateral”
or such other language as the Banks may from time to time require. After an
Event of Default, if requested by any Bank, all contracts, documents,
instruments and chattel paper evidencing an Account shall contain (by way of
stamp, legend or other method satisfactory to such Bank) the above quoted
language. Failure to deliver physical possession of any instruments, documents,
or writings in respect of any Account to any Bank, or all of them, shall not
invalidate any such Bank’s security interest therein. To the extent that
possession may be required by applicable law for perfection of a Bank’s security
interest, the original chattel paper and instruments representing the Accounts
(to the extent available) shall be deemed to be held by such Bank, although kept
by Borrower or Guarantor as the custodial agent of such Bank(s). Borrower or
Guarantor (as the case may be) shall, at any reasonable time and at Borrower’s
or Guarantor’s own expense, upon any Bank’s reasonable request, physically
deliver to such Bank on computer disk or other electronic data storage means
which shall be machine readable in Microsoft Access or such other form as
mutually agreed upon by the parties hereto, copies of all Accounts (including
any instruments, documents or writings in respect of any Account together with
all other instruments, documents or writings in respect of any collateral
securing each Account, then in Borrower’s or Guarantor’s control) assigned to a
Bank to any reasonable place or places designated by such Bank. All Accounts
shall, regardless of their location, be deemed to be under the Banks’ dominion
and control (with both paper and computer files so labeled) and deemed to be in
the Bank or Banks’, as applicable, possession.).

(c) A copy of any notice or request by any Bank pursuant to this Section 4.2,
and any response or information provided by Borrower to any Bank pursuant to
this Section 4.2, shall be delivered to all other Banks simultaneously.

4.3 Power of Attorney. Borrower does hereby irrevocably constitute and appoint
each Bank, or any of them, its true and lawful attorney with full power of
substitution, for it and in its name, place and stead, to execute, deliver and
file such agreements, documents, notices, statements and records, to include,
without limitation, Financing Statements, and to do or undertake such other acts
as any such Bank, after notice to Borrower and each other Bank, and after
providing a copy of any such item to Borrower in its sole discretion, deems
necessary or advisable to effect the terms and conditions of this Agreement, the
other Loan Documents and to otherwise preserve, protect and perfect the security
of the security interest in the Collateral. The foregoing appointment is and the
same shall be coupled with an interest in favor of the Banks. Notwithstanding
the foregoing present grant of a power of attorney by Borrower to the Banks,
except as otherwise provided in this Agreement and except with respect to filing
of Financing Statements and other actions any Bank deems necessary or
appropriate to preserve, protect, and perfect or continue the perfection of its
security interests in the Collateral, no Bank shall exercise the rights granted
to it under this Section 4.3 until after the occurrence of an Event of Default,
or the occurrence of an event which, upon the giving of any required notice or
the lapse of any required period of time, would be an Event of Default.

4.4 Right to Inspect and Audit. Any Bank (through any of its officers,
employees, agents or other persons designated by such Bank) shall have the
right, at its own expense (except after the occurrence of an Event of Default at
Borrower’s expense and without notice) upon reasonable prior notice, from time
to time during Borrower’s usual business hours, to inspect Borrower’s Books and
to make copies thereof and to inspect, check, test, audit and appraise the
Collateral and Borrower’s business affairs in order to verify Borrower’s
financial condition or the amount, condition of, or any other matter relating to
the Collateral and Borrower’s compliance with the terms and conditions of this
Agreement and the other Loan Documents. A Bank shall make reasonable efforts to
minimize disruption of Borrower’s operations when conducting such work. Borrower
shall permit representatives of the Banks to discuss the business, operations,
properties and financial and other conditions of Borrower with its officers,
board members, executives, managers, members, partners, employees, agents,
independent certified public accountants and others, as applicable. The
representatives of the Banks will maintain the confidentiality of non-public
information obtained from such discussions or otherwise and will not trade the
Borrower’s stock based upon material, non-public information concerning the
Company that the representatives of the Banks may obtain. Notwithstanding the
foregoing provisions of this Section 4.4, the Banks shall not be required to
give prior notice or limit their inspections to normal business hours if they,
or any of them, deem an emergency or other extraordinary situation to exist with
respect to the Collateral, Borrower’s Books and their other rights hereunder.

4.5 Collection of Accounts. In addition to its other rights and remedies in this
Agreement, the Banks shall have the rights and remedies set forth in this
Section 4.5, all of which may be exercised by the Banks, or any of them, upon
the occurrence of an Event of Default, or the occurrence of an event which, upon
the giving of any required notice or the lapse of any required period of time,
would be an Event of Default.

(a) After the occurrence of an Event of Default, but subject to the terms of the
Intercreditor Agreement, or the occurrence of an event or condition which, after
the giving of any required notice and the lapse of any required period of time,
would be an Event of Default, each Bank is authorized and empowered at any time
in its sole discretion (i) to demand, collect, settle, compromise for, recover
payment of, to hold as additional security for the Obligations and to apply
against the Obligations any and all sums which are now owing and which may
hereafter arise and become due and owing upon any of said Accounts and upon any
other obligation to Borrower (to include making, settling, adjusting, collecting
and recovering payment of all claims under and decisions with respect to
Borrower’s policies of insurance); (ii) to enforce payment of any Account and
any other obligation of any person to Borrower either in its own name or in the
name of Borrower; (iii) to endorse in the name of Borrower and to collect any
instrument or other medium of payment, whether tangible or electronic, tendered
or received in payment of the Accounts that constitute Collateral and any other
obligation to Borrower; (iv) to sign Borrower’s name on any invoice or bill of
lading relating to any Account, drafts against account debtors, schedules and
assignments of Accounts, verifications of Accounts and notices to account
debtors; and (v) dispose of any Collateral constituting Accounts and to convert
any Collateral constituting Accounts into other forms of Collateral. But, under
no circumstances shall any Bank be under any duty to act in regard to any of the
foregoing matters. Without limiting the provisions of Section 4.3 hereof, but in
addition thereto, Borrower hereby appoints each Bank and any employee or
representative of each Bank as such Bank may from time to time designate, as
attorneys-in-fact for Borrower, to sign and endorse in the name of Borrower, to
give notices in the name of Borrower and to perform all other actions necessary
or desirable in the reasonable discretion of such Bank to effect these
provisions and carry out the intent hereof. Borrower hereby ratifies and
approves all lawful acts of such attorneys-in-fact and except as otherwise
provided for herein, neither any Bank nor any other such attorneys-in-fact will
be liable for any lawful acts of commission or omission nor for any error of
judgment or mistake of fact or law. The foregoing power, being coupled with an
interest, is irrevocable so long as any Account pledged and assigned to such
Bank remains unpaid and this Agreement or any other Loan Document is in force.
The costs and expenses of such collection and enforcement shall be borne solely
by Borrower whether the same are incurred by a Bank or on behalf of a Bank or
Borrower and, if paid or incurred by a Bank, the same shall be an Obligation
owing by Borrower to such Bank, payable on demand with interest at the Default
Rate, and secured by this Agreement and the other Loan Documents. Borrower
hereby irrevocably authorizes and consents to all account debtors and other
persons communicating after an Event of Default with any Bank, or its agent,
with respect to Borrower’s property, business and affairs and to all of the
foregoing persons acting after an Event of Default upon and in accordance with a
Bank’s, or its representative’s, instructions, directions and demands,
including, without limitation, such Bank’s request and demand to pay money and
deliver other property to such Bank or Bank’s representatives, all without
liability to Borrower for so doing, except as otherwise provided herein.

(b) After the occurrence of an Event of Default, or the occurrence of an event
or condition which after the giving of any required notice or the lapse of any
required period of time, would be an Event of Default, at any Bank’s request,
Borrower will forthwith upon receipt of all checks, drafts, cash and other
tangible and electronic remittances in payment or on account of Borrower’s
Accounts, deposit the same in a special bank account maintained with such Bank
or its representative, over which such Bank and its representative (as
applicable) have the sole power of withdrawal and will designate with each such
deposit the particular Account upon which the remittance was made. The funds in
said account shall be held by such Bank as security for the Obligations (and
shall be subject to the terms of the Intercreditor Agreement). Said proceeds
shall be deposited in precisely the form received except for the endorsement of
Borrower where necessary to permit collection of items, which endorsement
Borrower agrees to make, and which endorsement the Bank and its representative
(as applicable) are also hereby authorized to make on Borrower’s behalf. Pending
such deposit, Borrower agrees that it will not commingle any such checks,
drafts, cash and other remittances with any of Borrower’s funds or property, but
will hold them separate and apart therefrom and upon an express trust for the
Banks until deposit thereof is made in the special account. After the occurrence
of an Event of Default, or the occurrence of an event or condition which after
the giving of any required notice or the lapse of any required period of time,
would be an Event of Default, the Bank maintaining such account may at anytime
and from time to time, in its sole discretion but subject to the terms of the
Intercreditor Agreement, apply any part of the credit balance in the special
account to the payment of all or any of the Obligations, and to payment of any
other obligations owing to the Banks under or on account of this Agreement or
any of the other Loan Documents. On the Maturity Date and upon the full and
final payment of all of the Obligations and the other obligations as aforesaid,
together with a termination of all Bank’s obligation to make additional
Advances, each Bank will pay over to the Borrower any excess good and collected
funds received by such Bank from Borrower, whether received as a deposit in the
special account or received as a direct payment on any of the Obligations.

(c) After the occurrence of an Event of Default, or the occurrence of an event
or condition which after the giving of any required notice or the lapse of any
required period of time, would be an Event of Default, each Bank shall have the
absolute and unconditional right to apply for and to obtain the appointment of a
receiver, custodian or similar official for all or a portion of the Collateral,
including, without limitation, the Accounts, to, among other things, manage and
sell the same, or any part thereof, and to collect and apply the proceeds
therefrom to payment of the Obligations as provided in this Agreement and the
other Loan Documents. Any such receiver, custodian or similar official, if
required, shall be qualified and licensed as a collection agency in each state
or territory in which any customer Accounts may be so collected or managed. In
the event of such application, Borrower consents to the appointment of such
qualified and licensed receiver, custodian or similar official and agrees that
such receiver, custodian or similar official may be appointed without further
notice to Borrower beyond any notice required to be given to Borrower prior to
the occurrence of an Event of Default, if any, without regard to the adequacy of
any security for the Obligations secured hereby and without regard to the
solvency of Borrower or any other person who or which may be liable for the
payment of the Obligations or any other obligations of Borrower hereunder. All
costs and expenses related to the appointment of a receiver, custodian or other
similar official hereunder shall be the responsibility of Borrower, but if paid
by any Bank, Borrower hereby agrees to pay to such Bank, on demand, all such
costs and expenses, together with interest thereon from the date of payment at
the Default Rate. All sums so paid by a Bank, and the interest thereon, shall be
an Obligation owing by Borrower to such Bank, and secured by this Agreement and
the other Loan Documents. Notwithstanding the appointment of any receiver,
custodian or other similar official, each Bank shall be entitled as pledgee to
the possession and control of any cash, deposits, accounts, account receivables,
documents, chattel paper, documents of title or instruments at the present or
any future time held by, or payable or deliverable under the terms of the Loan
Documents to such Bank. If the balance of the Obligation outstanding is ZERO at
any time prior to the Maturity Date, and no Event of Default has occurred or is
continuing and the Banks have no further obligation to make Advances, the Bank
or Banks, as applicable shall terminate the appointment of any such receiver
custodian or similar official.

5. REPRESENTATIONS AND WARRANTIES.

Borrower represents and warrants to each Bank that, as of the date of this
Agreement, there are no Subsidiaries of Borrower other than the Guarantor.
Further, Borrower represents and warrants to each Bank that the certifications,
representations and warranties set forth in the Certificate of Borrower which
has been executed and delivered by Borrower to each Bank contemporaneously with
the execution and delivery of this Agreement by Borrower to each Bank are true,
correct and accurate as of the date of this Agreement or such other date as may
be specifically set forth in a particular certification, representation or
warranty. Borrower agrees that all certifications, representations and
warranties set forth herein shall be continuing certifications, representations
and warranties of Borrower to each Bank.

6. AFFIRMATIVE COVENANTS.

Borrower covenants and agrees that until the termination of the Banks’
obligations under this Agreement to make Credit Extensions and the payment in
full of the Obligations, Borrower shall do each and all of the matters set forth
in this Section 6; and Borrower acknowledges to each Bank that the breach or
default by Borrower of any of the covenants and agreements set forth below in
this Section 6 is and the same shall be material.

6.1 Good Standing and Government Compliance. Borrower shall maintain in good
standing its and each of its Subsidiaries’ organizational existence in their
respective jurisdictions of organization and maintain qualification in each
jurisdiction in which the conduct of their respective businesses or their
respective ownership of property requires that they be so qualified. Borrower
shall comply, and shall cause each Subsidiary to comply with all Requirements of
Law to which they are subject, and shall maintain, and shall cause each of its
Subsidiaries to maintain, in force all licenses, approvals and agreements, the
loss of which or failure to comply with which could have a Material Adverse
Effect, or an adverse effect in a material manner on the Collateral or the
priority of the Banks’ security interest in the Collateral.

6.2 Payment/Performance. Borrower shall pay when due all amounts owing to the
Banks under this Agreement and the other Loan Documents and promptly perform all
other obligations of Borrower thereunder and hereunder.

6.3 Use of Loan Funds. Borrower shall use all loan proceeds disbursed to
Borrower only for the purposes stated in this Agreement and the other Loan
Documents.

6.4 Financial Statements; Reports; Certificates.

(a) Borrower shall deliver to each Bank each and all of the financial
statements, reports, certificates and other records referenced under this
subsection (a) and such other statements, reports, certificates and records as
any Bank may reasonably request from time to time.

(i) As soon as available, but in any event within thirty (30) days after the end
of each calendar quarter, Borrower shall deliver to each Bank internally
prepared consolidated financial statements.

(ii) Beginning with the fiscal year ending December 31, 2005, as soon as
available, but in any event within one hundred twenty (120) days after the end
of Borrower’s fiscal year, Borrower shall deliver to each Bank audited CPA
prepared consolidated and, upon request of any Bank, internally prepared
consolidating, financial statements of Borrower (including a balance sheet, an
income statement and a statement of retained earnings, each with the related
notes and changes in the financial position for such year and setting forth in
comparative form the figures for the prior year) prepared in accordance with
GAAP, consistently applied, together with (with respect to the CPA prepared
statements) an opinion on such financial statements that is unqualified or
qualified in a manner acceptable to the Banks from an independent certified
public accounting firm reasonably acceptable to the Banks. After the occurrence
of an Event of Default, any Bank may request and Borrower shall so provide
audited CPA prepared consolidating statements which meet the foregoing
requirements established for consolidated statements.

(iii) Within thirty (30) days after the last day of each fiscal quarter,
Borrower shall deliver to each Bank a statement of Borrower’s Net Finance
Receivable prepared and presented in a manner and format consistent with past
practice and consistent with the manner and format employed in Borrower’s public
filings, and will be consistent with the information contained in Borrower’s
public filings for the same periods.

(iv) If applicable, Borrower shall deliver to each Bank copies of all
statements, reports and notices sent or made available generally by Borrower to
its security holders or to any holders of Subordinated Liabilities and all
reports on Forms 10-K and 10-Q filed with the Securities and Exchange
Commission.

(v) Within thirty (30) days after the last day of each fiscal quarter, Borrower
shall deliver to each Bank a report of any legal actions pending or threatened
against Borrower or any Subsidiary, which report shall include at a minimum the
claimant, the amount of the claim, the defendants named and the date of such
claim. Borrower agrees to cooperate in good faith with respect to any additional
information requested by any Bank with respect to such reports.

(b) Within thirty (30) days after the last day of each month, Borrower shall
deliver to each Bank a Borrowing Base Certificate dated and signed by a
Responsible Officer in substantially the form of Exhibit D hereto that provides
the required information that is current within one day.

(c) Within thirty (30) days after the last day of each month, Borrower shall
deliver to each Bank with the monthly financial statements a Compliance
Certificate signed by a Responsible Officer in substantially the form of
Exhibit E hereto.

(d) Borrower shall provide such additional statements and information as any
Bank may from time to time request, in form reasonably acceptable to the Banks.
Each Bank shall keep such information confidential which is marked
“Confidential” and which has not been disclosed to third parties, and shall not
disclose such information to any department of such Bank which provides
investment and stock brokerage services.

6.5 Taxes. Borrower shall make, and shall cause each Subsidiary to make, due and
timely payment of, or deposit or withholding of, all federal, state and local
taxes, assessments or contributions required of it by all Requirements of Law,
and will execute and deliver to each Bank, on demand, appropriate certificates
attesting to the payment, deposit or withholding thereof; provided that Borrower
or a Subsidiary need not make any payment if the amount or validity of such
payment is contested in good faith by appropriate proceedings and is reserved
against (to the extent required by GAAP) by Borrower.

6.6 Insurance.

(a) Borrower, at its expense, shall keep the Collateral insured against loss or
damage by fire, theft, explosion, sprinklers and all other hazards and risks
required by the Banks, acting reasonably and taking into account the types and
risks customarily insured against by businesses similar to Borrower’s. Unless
otherwise directed by the Banks, the insurance shall be all risk replacement
cost insurance with agreed amount endorsement, standard noncontributing
mortgagee clauses and standard waiver of subrogation clauses. Borrower shall
also maintain general liability, workmen’s compensation and other insurance in
amounts and of a type that are customary to businesses similar to Borrower’s,
unless the Banks reasonably direct otherwise, in which event Borrower shall
maintain such insurance in amounts and types as the Banks reasonably direct.

(b) All policies of insurance shall be in such form and with such companies as
may be reasonably satisfactory to the Banks. All policies of property insurance
shall contain a lender’s loss payable endorsement, in a form reasonably
satisfactory to the Banks, showing the Banks, collectively, as additional loss
payees, and all liability insurance policies shall show the Banks, collectively,
as additional insureds. All policies shall specify that the insurer must give at
least twenty (20) days’ notice to each Bank before canceling its policy for any
reason. Upon any Bank’s request, Borrower shall deliver to each Bank certified
copies of the policies of insurance and evidence of all premium payments. All
proceeds payable under any casualty policy or policies shall, at the payee
Bank’s option, be payable to such Bank to be applied on account of the
Obligations, except for casualty policies insuring loss of assets encumbered by
Permitted Liens which are prior to the Lien of such Bank.

6.7 Primary Depository. Each of Borrower and its wholly owned Subsidiaries
(excluding the operating depositing account of PRA Receivables Management, LLC,
d/b/a Anchor Receivables Management) shall maintain their primary operating
depository accounts with the Banks during the term of the Revolving Facility. At
least one operating deposit account shall be maintained with each Bank.

6.8 Financial Covenants. On a consolidated basis, Borrower shall maintain, as of
the last day of each calendar month unless stated otherwise, and Borrower shall
fully and timely comply on a consolidated basis with, each and every one of the
financial maintenance covenants set forth in this Section and others that may be
contained in this Agreement and the other Loan Documents.

(a) Funded Debt to EBITDA. A ratio not exceeding 2.0:1.0.

(b) Tangible Net Worth. Maintain on a consolidated basis Tangible Net Worth
equal to at least 100% of Tangible Net Worth reported by Borrower at
September 30, 2005, plus 25% of cumulative positive net income accrued since the
end of such fiscal quarter, plus 100% of the net proceeds from any equity
offering, calculated quarterly on the last day of each fiscal quarter. For
purposes of this covenant, Tangible Net Worth of Borrower shall be calculated
without giving effect to reductions in Tangible Net Worth due to repurchases of
up to $100,000,000 of Borrower’s capital stock by Borrower.

6.9 Maintenance of Property. Borrower shall keep and maintain the Collateral in
good working order and condition and make all needful and proper repairs,
replacements, additions, or improvements thereto as are necessary, reasonable
wear and tear excepted.

6.10 Maintain Security Interest. Borrower shall maintain, protect and preserve
the security interest of the Banks in the Collateral and the lien position of
the Banks in the Collateral, including, without limitation, (i) the filing of
“claims” under insurance policies and (ii) protecting, defending and maintain
the validity and enforceability of the Trademarks, Patents and Copyrights.

6.11 Deposit Accounts. With respect to deposit accounts that are maintained with
financial institution other than the Banks, the Banks, or any of them, may
request, and Borrower and each of its Subsidiaries shall obtain in favor of such
Bank(s), a control agreement in form and substance satisfactory to such Bank(s).

6.12 Further Assurances. At any time and from time to time, Borrower shall
execute and deliver such further instruments, agreements, documents and other
records and take such further action as may be requested by any Bank to effect
the purposes of this Agreement, including, without limitation, the perfection
and continuation of perfection of the Banks’ security interests in the
Collateral.

7. NEGATIVE COVENANTS.

Borrower covenants and agrees that until the termination of all Banks’
obligations under this Agreement to make Credit Extensions, and the payment in
full of the Obligations, Borrower shall not do or permit to be done any of the
matters set forth in this Section 7; and Borrower acknowledges to each Bank that
the breach or default by Borrower of any of the covenants and agreements set
forth below in this Section 7 is and the same shall be material.

7.1 Dispositions. Borrower shall not convey, sell, lease, transfer and otherwise
dispose of and Borrower shall not permit any of its Subsidiaries to convey,
sell, lease, transfer and otherwise dispose of (with respect to both Borrower
and Borrower’s Subsidiaries, by operation of law or otherwise) any part of and
any interest in their respective businesses and properties, including the
Collateral, other than Permitted Transfers.

7.2 Change in Business; Change in Management or Executive Office. Borrower shall
not engage in any business, or permit any of its Subsidiaries to engage in any
business, other than as reasonably related or incidental to the businesses
currently engaged in by Borrower. Borrower shall not have a Change in Management
and will not, without thirty (30) days’ prior written notification to each Bank,
relocate its chief executive office, change its state of organization or change
any other matter that will or could result in any Bank’s security interests in
the Collateral becoming unperfected.

7.3 Mergers or Acquisitions; New Subsidiary. Except for Permitted Acquisitions,
Borrower shall not merge or consolidate, or permit any of its Subsidiaries to
merge or consolidate, with or into any other business organization, or acquire,
or permit any of its Subsidiaries to acquire, all or substantially all of the
capital stock or property of another person without the prior written consent of
each Bank, which any Bank may grant or withhold in its sole and absolute
discretion. Borrower shall not create or cause to be created or to come into
existence any new Subsidiary after the Closing Date, without the prior written
consent of each Bank.

7.4 Indebtedness. Borrower shall not create, incur, assume or be or remain
liable with respect to any Indebtedness, or permit any Subsidiary so to do,
other than Permitted Indebtedness and normal and customary unsecured
indebtedness incurred in the ordinary course of business. With respect to
Indebtedness described in clause (iii) of the definition of Permitted
Indebtedness in Exhibit A, to the extent not specifically prohibited by the
terms of such Indebtedness, the Banks shall have a subordinate lien in and to
all equipment and property financed or acquired with such Indebtedness (with the
priority and allocation of such subordinate lien among the Banks to be
determined pursuant to the Intercreditor Agreement).

7.5 Encumbrances. Borrower shall not create, incur, assume or allow any Lien
with respect to the Collateral or any of its property, or assign or otherwise
convey any right to receive income, including the sale of any Accounts, or
permit any of its Subsidiaries so to do, except for Permitted Liens, or covenant
to any other person that Borrower in the future will refrain from creating,
incurring, assuming or allowing any Lien with respect to any of Borrower’s
property.

7.6 Judgments. Borrower shall not permit a judgment or judgments for the payment
of money in excess of $500,000 in the aggregate to be entered against it or any
Subsidiary which judgment Borrower permits to remain unsatisfied or unstayed for
a period of thirty (30) days after the same is entered against Borrower or a
Subsidiary.

7.7 Distributions. Except for Permitted Dividends and Permitted Investments,
Borrower shall not pay any dividends or make any other distribution or payment
on account of or in redemption, retirement or purchase of any capital stock, or
permit any of its Subsidiaries to do so.

7.8 Investments. Borrower shall not directly or indirectly acquire or own, or
make any Investment in or to any person, or permit any of its Subsidiaries so to
do, other than Permitted Investments.

7.9 Loans. Except for Permitted Investments and Permitted Acquisitions, Borrower
shall not make or commit to make, or permit any of its Subsidiaries to make or
commit to make, any advance, loan, extension of credit or capital contribution
to, or purchase of any stock, bonds, notes, debentures or other securities of
any person.

7.10 Loans to Officers. Borrower shall not make, or permit any of its
Subsidiaries to make, any loan or advance directly or indirectly for the benefit
of any past, present, or future stockholder, director, officer, executive,
manager, member, partner or employee of Borrower or a Subsidiary, as the case
may be, other than advances or loans made in the ordinary course of business
consistent with past practice, including but not limited to employee relocation
loans, employee bridge loans and other incidental loans to employees, all in the
ordinary course of business.

7.11 Compensation. Borrower shall not pay, or permit any Subsidiary to pay, any
compensation to any past, present or future shareholder, director, officer,
executive, member, manager, partner and employee, whether through salary, bonus
or otherwise, if contrary to Borrower’s compensation policies or the executive
compensation rules established by the United States Securities and Exchange
Commission or the NASDAQ Stock Exchange.

7.12 Transactions with Affiliates. Borrower shall not directly or indirectly
enter into or permit to exist, or permit any Subsidiary to directly or
indirectly enter into or permit to exist, any material transaction with any
Affiliate of Borrower or any Subsidiary except for transactions that are in the
ordinary course of Borrower’s or such Subsidiary’s business, upon fair and
reasonable terms that are no less favorable to Borrower or Subsidiary than would
be obtained in an arm’s length transaction with a non-affiliated Person.

7.13 Subordinated Liabilities. Borrower shall not make any payment in respect of
any Subordinated Liabilities, or permit any of its Subsidiaries to make any such
payment except in compliance with the terms of such Subordinated Liabilities, or
amend any provision contained in any documentation relating to the Subordinated
Liabilities without each Bank’s prior written consent.

7.14 Inventory and Equipment. Borrower shall not store, or permit any Subsidiary
to store, its Equipment with a bailee, warehouseman or similar person unless the
Banks have received a pledge of the warehouse receipt covering such Equipment.
Except for such other locations as each Bank may approve in writing, Borrower
shall not move or relocate its Equipment from the location or locations
identified in the Certificate of Borrower and such other locations of which
Borrower gives each Bank prior written notice and as to which Borrower
authorizes the filing of a Financing Statement where needed to perfect each
Bank’s security interest.

7.15 Licenses. Borrower shall not become bound by, or permit its Subsidiaries to
become bound by, any license, agreement or other record which would have a
Material Adverse Effect.

7.16 Compliance. Borrower shall not become or be controlled by an “investment
company”, within the meaning of the Investment Company Act of 1940, or become
principally engaged in, or undertake as one of its important activities, the
business of extending credit for the purpose of purchasing or carrying margin
stock, or use the proceeds of any Credit Extension for such purpose, or permit
any of its Subsidiaries to do any of the foregoing.

7.17 Negative Pledge Agreements. Borrower shall not permit the inclusion in any
contract to which it becomes a party of any provisions that could restrict or
invalidate the creation of a security interest in Borrower’s rights and
interests in any Collateral.

7.18 Third Party Agreements. Borrower shall not enter into any agreement
containing any provision that would be violated or breached by the performance
of the obligations of Borrower under this Agreement.

8. EVENTS OF DEFAULT.

The occurrence of any one or more of the events, conditions, circumstances and
matters set forth below in this Section 8 shall constitute an Event of Default
by Borrower under this Agreement and the other Loan Documents. Notwithstanding
the foregoing and anything else in this Agreement to the contrary, if any of the
Obligations are payable on demand of the Banks, or any of them, then, in such
event, there are no conditions precedent to any such Bank’s right to demand
payment of such Obligations, in whole or in part, at any time and from time to
time, without prior notice, until the entire unpaid balance outstanding under
such Obligations, including principal, interest, fees, premiums, charges and
costs and expenses are paid in full. And, there are no conditions precedent to
any Bank exercising any of and all of its other rights and remedies at such time
or times as it deems necessary or appropriate to recover full payment of the
Obligations, including, without limitation, the exercise of any of and all of
its rights and remedies set forth in Section 9 below, the exercise of any of and
all of its other rights and remedies granted to it under the Loan Documents and
the exercise of any of and all of its rights and remedies at law and in equity.
The rights and obligations of the Banks relative to each other with respect to
the priority of liens and the exercise of rights against, and the allocation of,
the Collateral, are set forth in the Intercreditor Agreement.

8.1 Default under Obligations. The occurrence of any event of default or default
condition under any of the Obligations, including, without limitation,
Borrower’s failure to pay, when due, the principal of and interest on any of the
Obligations, or Borrower’s failure to pay, when due, any and all other amounts
due under any of the Obligations, including, without limitation, any taxes,
fees, charges, premiums and costs and expenses.

8.2 Covenant Default. Borrower fails to perform or satisfy any obligation under
Section 6 or violates any of the covenants contained in Section 7 of this
Agreement, or fails or neglects to perform or observe or otherwise defaults
under any other term, provision, condition, covenant or agreement contained in
this Agreement, in any of the other Loan Documents, or in any other present or
future instrument, document, agreement or other record between Borrower and any
Bank or from Borrower to any Bank or for the benefit of any Bank, whether
monetary or non-monetary, and as to any default under such other term,
provision, condition, covenant or agreement that can be cured, has failed to
cure such default within ten (10) days after Borrower receives notice thereof or
any officer of Borrower becomes aware thereof; provided, however, that if the
default is non-monetary and cannot by its nature be cured within the ten
(10) day period or cannot after diligent attempts by Borrower be cured within
such ten (10) day period, and such default is likely to be cured within a
reasonable time, then Borrower shall have an additional reasonable period (which
shall not in any case exceed thirty (30) days) to attempt to cure such
non-monetary default, and within such reasonable time period the failure to have
cured such default shall not be deemed an Event of Default (provided that the
Banks shall not be required to make any Credit Extensions during such cure
period).

8.3 Guarantor Default. The failure of any other person obligated for the payment
of any of the Obligations, either directly or indirectly, or obligated under
this Agreement or any of the other Loan Documents to perform any of the terms
and conditions imposed upon such other person by any of said agreements, as and
when the same are required to be so performed, or the occurrence of some other
default by such other person under any of said agreements.

8.4 Termination of Supporting Obligation. The termination of or the occurrence
of an event of default or a default condition, after the expiration of any
applicable cure periods, under any guaranty agreement or other supporting
obligation (inclusive of letters of credit, third person pledge agreements and
third person security agreements) which applies to this Agreement or any of the
other Loan Documents.

8.5 Attachment. Borrower’s assets, or any part or portion thereof, are attached,
seized, subjected to a writ or distress warrant, or are levied upon, or come
into the possession of any trustee, receiver or person acting in a similar
capacity and such attachment, seizure, writ or distress warrant or levy has not
been removed, discharged or rescinded within ten (10) days, or if Borrower is
enjoined, restrained or in any way prevented by court order from continuing to
conduct all or any material part of its business affairs, or if a judgment or
other claim becomes a lien or encumbrance upon any material portion of
Borrower’s assets, or if a notice of lien, levy or assessment is filed of record
with respect to any of Borrower’s assets by the United States Government, or any
department, agency or instrumentality thereof, or by any state, county,
municipal or governmental agency, and the same is not paid within ten (10) days
after Borrower receives notice thereof, provided that none of the foregoing
shall constitute an Event of Default where such action or event is stayed or an
adequate bond has been posted pending a good faith contest by Borrower (provided
that no Credit Extensions will be required to be made during such cure period).

8.6 Insolvency. Borrower becomes insolvent, or an Insolvency Proceeding is
commenced by Borrower, or an Insolvency Proceeding is commenced against Borrower
and is not dismissed or stayed within thirty (30) days (provided that no Credit
Extensions will be required to be made prior to the dismissal of such Insolvency
Proceeding).

8.7 Other Agreements. The occurrence of a default in any agreement or agreements
to which Borrower is a party with a third person or persons which results in a
right by such third person or persons, whether or not exercised, to accelerate
the maturity of any Indebtedness in an amount in the aggregate in excess of 2%
of Borrower’s Tangible Net Worth or that could have a Material Adverse Effect.

8.8 Subordinated Liabilities. Borrower makes any payment on account of
Subordinated Liabilities, except to the extent the payment is allowed under any
subordination agreement entered into with the Banks.

8.9 Misrepresentations. Any misrepresentation or misstatement exists now or
hereafter in any warranty or representation set forth herein, in any other Loan
Document or in any certificate delivered to any Bank by any Responsible Officer
pursuant to this Agreement or any other Loan Document, or to induce any Bank to
enter into this Agreement or any other Loan Document.

8.10 ERISA. An ERISA Event occurs that will cause a Material Adverse Effect.

8.11 Subsidiary Default. Default by any of Borrower’s Subsidiaries under any
Indebtedness or other obligation now owing or which hereafter arises and is
owing to any Bank.

9. BANK’S RIGHTS AND REMEDIES UPON DEFAULT.

9.1 Rights and Remedies upon an Event of Default. If an Event of Default shall
occur under this Agreement, in addition to any other rights and remedies which
may be available to the Banks and without limiting any other rights and remedies
granted to the Banks in this Agreement, the other Loan Documents and at law and
in equity, including, without limitation, the rights and remedies provided to
the Banks under the Code, which rights and remedies are fully exercisable by
each Bank as and when provided herein and therein, the Banks shall have the
rights and remedies set forth below in this Section 9.1, any and all of which
any Bank may exercise at its election, without notice to Borrower of its
election and without demand, but subject to the rights of each other Bank under
the Intercreditor Agreement, and with immediate written notice to each other
Bank of the exercise of any such right or remedy.

(a) Acceleration of Obligations. Any Bank may, at its option, accelerate and
declare immediately due and payable the Obligations owing to it, as well as any
of and all of the other indebtedness and obligations owing under this Agreement
and the other Loan Documents that are not already due hereunder to such bank. If
there is more than one Obligation, any Bank may accelerate and declare
immediately due and payable all of the Obligations owing to it, or any Bank may
from time to time and at any number of times after the occurrence of an Event of
Default, accelerate and declare immediately due and payable any one or more of
the Obligations owing to it, as such Bank in its discretion elects to accelerate
(provided that upon the occurrence of an Event of Default described in Section 8
under the heading “Insolvency”, all Obligations shall become immediately due and
payable without any action by any Bank).

(b) Terminate Credit Extensions. Each Bank may limit Borrower’s right to receive
any and all Advances under this Agreement and under any other agreement between
such Bank and Borrower to such amounts as such Bank determines from time to time
to be appropriate under the circumstances; each Bank may impose a moratorium on
future Advances under this Agreement and under any other agreement between such
Bank and Borrower; and each Bank may terminate the right of Borrower to receive
Advances under this Agreement and under any other agreement between Borrower and
such Bank; and in all the foregoing instances, a Bank’s rights relative to
Credit Extensions may be exercised cumulatively, concurrently, alternatively and
in any other manner and at any time or times as such Bank deems appropriate, in
its discretion.

(c) Protection of Collateral. Each Bank may make such payments and do or cause
to be done such acts as such Bank considers necessary or advisable to protect
the Collateral and to preserve, protect, perfect and continue the perfection of
its security interest in the Collateral. Borrower agrees to assemble the
Collateral if any Bank so requires and to make the Collateral available to a
Bank as such Bank (subject to the Intercreditor Agreement) may designate.
Borrower authorizes each Bank and its representatives to enter the premises
where the Collateral is located, to do, among other things a Bank deems
necessary or advisable, the following: (i) take and maintain possession of the
Collateral, or any part or parts of it, (ii) pay, purchase, contest or
compromise any encumbrance, charge or lien which in a Bank’s determination
appears to be prior or superior to its security interest, and (iii) pay all
costs and expenses incurred in connection with any of the foregoing. With
respect to any of Borrower’s premises, Borrower hereby grants each Bank a
license to enter into possession of such premises and to occupy the same,
without charge, in order to exercise any of the Banks’ rights and remedies
provided herein, at law, in equity and otherwise.

(d) Sale and Disposition of Collateral Upon Default.

(i) Each Bank, directly and through others on its behalf, may ship, reclaim,
recover, store, finish, maintain, repair, prepare for sale, advertise for sale
and/or sell the Collateral, or part or parts thereof, for cash or on terms, at
one or more private or public sales held at such place or places as such Bank
determines to be commercially reasonable, after having complied with the
provisions of this Agreement, the Intercreditor Agreement, the other Loan
Documents and applicable Requirements of Law relating to sale of the Collateral,
including, without limitation, the requirements of the Code. Each Bank is hereby
irrevocably granted a license or other right, pursuant to the provisions of this
Section 9.1, to use, without charge, Borrower’s labels, patents, copyrights,
rights of use of any name, trade secrets, trade names, trademarks, service
marks, advertising matter and any property of a similar nature, together with
the right of access to all tangible or electronic media in which any of the
foregoing may be recorded or stored, in completing production of, management of,
advertising for sale and selling any Collateral and, in connection with a Bank’s
exercise of its rights under this Section 9.1, Borrower’s rights under all
licenses and all franchise agreements shall inure to the Banks’ benefit.
Borrower hereby agrees: (i) that fifteen (15) days notice of any intended sale
or disposition of any Collateral is commercially reasonable; (ii) that a shorter
period of notice of not less than ten (10) days will be commercially reasonable
if each Bank, in its opinion, deems it necessary to move more expeditiously with
disposition of the Collateral or any part thereof; and (iii) that the foregoing
shall not require a notice if no notice is required under the Code (except
immediate notice to each other Bank).

(ii) Each Bank, or any or all of them, may credit bid and purchase at any sale
or sales.

(iii) The proceeds of any sale of, or other realization upon, all or any part of
the Collateral pursuant to this Section 9.1 shall be applied by the Banks in the
following order of priorities (subject to the terms of the Intercreditor
Agreement), or such other order as the Banks, together, may determine or as may
be required under applicable Requirements of Law: first, to payment of the costs
and expenses of such sale or other realization, and all expenses, liabilities
and advances incurred or made by the Banks in connection therewith, and any
other unreimbursed costs and expenses for which the Banks are to be reimbursed
pursuant to this Agreement and the other Loan Documents; second, to the payment
of accrued but unpaid interest on the Obligations; third, to the payment of
unpaid principal of the Obligations; fourth, to the payment of all other amounts
owing or outstanding by Borrower under the Obligations, this Agreement, the
other Loan Documents and otherwise to any Bank as provided herein or therein,
until all the foregoing shall have been paid in full; finally, to payment to
Borrower or its successors or assigns, or as a court of competent jurisdiction
may direct, of any surplus then remaining from such proceeds.

(iv) Any deficiency that exists after disposition of the Collateral as provided
above will be paid immediately by Borrower, without demand by any Bank, but this
provision shall not require any Bank to first dispose of the Collateral before
attempting to recover payment of the Obligations from Borrower or any other
person and each Bank shall have the right to proceed successively, concurrently
and alternatively against the Collateral, the Borrower and any other person
obligated on any of the Obligations in any order and at any time or times as it
deems to be in its best interest.

(e) Discontinuance of Proceedings; Position of Parties Restored. If any Bank
shall have proceeded to enforce any right or remedy under the Loan Documents by
foreclosure, entry, or otherwise and such proceedings shall have been
discontinued or abandoned for any reason, or such proceedings shall have
resulted in a final determination adverse to any Bank, then and in every such
case Borrower and each Bank shall be restored to their former positions and
rights hereunder, and all rights, powers and remedies of the Banks shall
continue as if no such proceedings had occurred or had been taken.

9.2 Remedies Cumulative. Each Bank’s rights and remedies under this Agreement,
the Loan Documents and all other agreements shall be cumulative and may be
exercised successively, concurrently, alternatively and in any other order and
at such time or times as any Bank elects in its discretion. Each Bank shall have
all other rights and remedies not inconsistent herewith as provided under the
Code, by law and in equity. No exercise by any Bank of one right or remedy shall
be deemed an election, and no waiver by any Bank, or all of them, of any Event
of Default on Borrower’s part shall be deemed a continuing waiver. No delay by
any Bank, or all of them, shall constitute a waiver, election or acquiescence by
it. No waiver by any Bank shall be effective unless made in a written document
signed on behalf of such Bank and then shall be effective only in the specific
instance and for the specific purpose for which it was given. For the avoidance
of doubt, a waiver of one Bank shall not in any event constitute a waiver by any
other Bank absent its execution thereof.

10. NOTICES.

Unless otherwise provided in this Agreement, all notices or demands by any party
relating to this Agreement or any other agreement entered into in connection
herewith shall be in writing and (except for financial statements and other
informational documents which may be sent by first-class mail, postage prepaid)
shall be personally delivered or sent by a recognized overnight delivery
service, certified mail, postage prepaid, return receipt requested, or by
facsimile to Borrower or to a Bank, as the case may be, at their respective
addresses as set forth on the signature page of this Agreement. Any such notice
or demand sent by or to Borrower shall be sent simultaneously to all Banks. The
parties may change the address at which they are to receive notices hereunder by
notice in writing in the foregoing manner given to the other.

11. WAIVERS.

11.1 Waiver Of Trial By Jury. To the extent not prohibited by applicable
Requirements of Law, Borrower and each Bank hereby waive their respective rights
to a jury trial of any claim or cause of action based upon or arising out of any
of the Loan Documents or any of the transactions contemplated therein, including
contract claims, tort claims, breach of duty claims and all other common law or
statutory claims. Each party recognizes and agrees that the foregoing waiver
constitutes a material inducement for it to enter into this Agreement. Each
party represents and warrants that it has reviewed this waiver with its legal
counsel and that it knowingly and voluntarily waives its jury trial rights
following consultation with legal counsel.

11.2 Marshalling of Assets. Borrower hereby waives, to the extent permitted by
law, the benefit of all appraisal, valuation, stay, extension, reinstatement and
redemption laws now in force and those hereafter in force and all rights of
marshalling in the event of any sale hereunder of the Collateral or any part or
any interest therein.

11.3 Waiver of Action Against Third Persons. Borrower waives any right to
require any Bank to bring any action against any other person or to require that
resort be had to any security or to any balances of any deposit or other
accounts or debts or credits on the books of any such Bank in favor of any other
person.

12. GENERAL PROVISIONS.

12.1 Indemnification. Borrower hereby agrees to defend, protect, indemnify and
hold harmless each Bank, all directors, officers, employees, attorneys, agents
and independent contractors of each Bank, from and against all claims, actions,
liabilities, damages and costs and expenses asserted against, imposed upon or
incurred by such Bank or any of such other persons as a result of, or arising
from, or relating to this Agreement, the other Loan Documents or the
transactions contemplated hereby or thereby, except for losses resulting from
the gross negligence or willful misconduct of or breach of this Agreement by,
the person otherwise to be indemnified hereunder.

12.2 Choice of Law. This Agreement shall be deemed to have been executed and
delivered in the Commonwealth of Virginia regardless of where the signatories
may be located at the time of execution and shall be governed by and construed
in accordance with the substantive laws of the Commonwealth of Virginia,
excluding, however, the conflict of law provisions thereof.

12.3 Additional Lenders. Additional lenders may be added to this credit facility
upon the written consent of all parties hereto, the execution by such additional
lenders of an additional signature page to this Agreement evidencing such
lender’s agreement to be bound by the terms hereof, and the similar execution by
such lenders of the Intercreditor Agreement and such other instruments and
agreements as may be required by the Banks then party hereto. The joinder of any
such lender to this credit facility shall not in any way affect the rights or
obligations of the Banks then party hereto, except that the Commitments
hereunder shall be adjusted from the date of such joinder in such manner as all
parties may agree. Any such additional lender shall be deemed a “Bank” for
purposes of this Agreement.

12.4 Incorporation of Exhibits; Customer and Loan Numbers. All exhibits,
schedules, addenda and other attachments to this Agreement are by this reference
incorporated herein and made a part hereof as if fully set forth in the body of
this Agreement. The Customer and Loan Numbers, if any, stated in this Agreement
are for the respective Bank’s internal business use and reference only and do
not and shall not limit the scope and extent of any Bank’s rights hereunder,
including the Obligations secured hereby and the security interests of the Banks
in the Collateral.

12.5 Maintenance of Records by Banks. Borrower acknowledges and agrees that each
Bank is authorized to maintain, store and otherwise retain the Loan Documents or
any of them in their original, inscribed tangible form or a record thereof in an
electronic medium or other non-tangible medium which permits such record to be
retrieved in a perceivable form; that a record of any of the Loan Documents in a
non-tangible medium which is retrievable in a perceivable form shall be the
agreement of Borrower to the same extent as if such Loan Document was in its
original, inscribed tangible medium and such a record shall be binding on and
enforceable against Borrower notwithstanding the same is in a non-tangible form
and notwithstanding the signatures of the signatories hereof are electronic,
typed, printed, computer generated, facsimiles or other reproductions,
representations or forms; and that a Bank’s certification that a non-tangible
record of any of the Loan Documents is an accurate and complete copy or
reproduction of the original, inscribed tangible form shall be conclusive,
absent clear and convincing evidence of the incorrectness of said certification,
and such non-tangible record or a reproduction thereof shall be deemed an
original and have the same force and effect as the original, inscribed tangible
form.

12.6 Credit Investigations; Sharing of Information; Control Agreements. Each
Bank is irrevocably authorized by Borrower, during the term of this Agreement
and until the last to occur of (i) payment in full of all the Obligations and
(ii) termination of the Banks’ obligations to make Credit Extensions under this
Agreement, to make or have made such credit investigations as it deems
appropriate to evaluate Borrower’s and its Subsidiaries’ credit or financial
standing, and Borrower authorizes each Bank to share with its affiliates its
experiences with Borrower and its Subsidiaries and other information in Bank’s
possession relative to Borrower and its Subsidiaries. The Banks (i) shall not
have any obligation or responsibility to provide information to third persons
relative to any Bank’s security interest in the Collateral, this Agreement or
otherwise with respect to Borrower and its Subsidiaries and (ii) shall not have
any obligation or responsibility to subordinate its security interest in the
Collateral to the interests of any third persons or to enter into control
agreements relative to the Collateral.

12.7 Banks’ Liability for Collateral. Notwithstanding anything in this Agreement
or any of the other Loan Documents to the contrary, a Bank may at any time or
times during the term of this Agreement make such payments and do or cause to be
done such acts as a Bank considers necessary or advisable to protect the
Collateral and to preserve, protect and perfect or continue the perfection of
its security interest in the Collateral. So long as a Bank complies with
reasonable banking practices, except as may be provided herein to the contrary,
such Bank shall not in any way or manner be liable or responsible for: (i) the
safekeeping of the Collateral; (ii) any loss or damage thereto occurring or
arising in any manner or fashion from any cause; (iii) any diminution in the
value thereof; or (iv) any act or default of any carrier, warehouseman, bailee,
forwarding agency or other person whomsoever.

12.8 Bank Expenses. If Borrower fails to pay any amounts or furnish any required
proof of payment due to third persons, as required under the terms of this
Agreement and the other Loan Documents, then after ten (10) days prior written
notice to Borrower, and Borrower’s failure to pay such amounts, the Banks, or
any of them, may do or cause to be done any or all of the following: (i) make
payment of the same or any part thereof; (ii) set up such reserves as such
Bank(s) deems necessary to protect it from the exposure created by such failure;
and (iii) obtain and maintain insurance policies of the type required by this
Agreement, and take any action with respect to such policies as any Bank deems
prudent. Any amounts so paid or deposited by such Bank shall constitute Bank
Expenses, shall be immediately due and payable, shall bear interest at the
Default Rate from the date of payment or deposit and shall be secured by the
Collateral. Any payments made by a Bank shall not constitute an agreement by a
Bank to make similar payments in the future or a waiver by any Bank of any Event
of Default under this Agreement. If a Bank is requested to waive an Event of
Default or forbear taking action relative thereto, such Bank may condition any
waiver or forbearance it elects, in its discretion, to grant Borrower on payment
by Borrower of such fees to Bank as such Bank deems appropriate under the
circumstances and may condition any such waiver or forbearance on Borrower
reimbursing such Bank for all costs and expenses such Bank incurs in connection
with such waiver or forbearance.

12.9 No Waiver; No Course of Dealing. Any Bank, at any time or times, may grant
extensions of time for payment or other indulgences or accommodations to any
person obligated on any of the Obligations, or permit the renewal, amendment or
modification thereof or substitution or replacement therefor, or permit the
substitution, exchange or release of any property securing any of the
Obligations and may add or release any person primarily or secondarily liable on
any of the Obligations, all without releasing Borrower from any of its
liabilities and obligations under any of the Loan Documents and without such
Bank waiving any of its rights and remedies under any of the Loan Documents, or
otherwise, and further without effecting any release or waiver of any
liabilities, obligations, rights or remedies accruing to any other Bank. No
delay or forbearance by any Bank in exercising any or all of its rights and
remedies hereunder and under the other Loan Documents or rights and remedies
otherwise afforded by law or in equity shall operate as a waiver thereof or
preclude the exercise thereof during the continuance of any Event of Default as
set forth herein or in the event of any subsequent Event of Default hereunder.
Also, no act or inaction of any Bank under any of the Loan Documents shall be
deemed to constitute or establish a “course of performance or dealing” that
would require such Bank, or any of them, to so act or refrain from acting in any
particular manner at a later time under similar or dissimilar circumstances.

12.10 Relationship of Parties; Successors and Assigns. The relationship of the
Banks to Borrower is that of a creditor to an obligor (inclusive of a person
obligated on a supporting obligation) and a creditor to a debtor; and in
furtherance thereof and in explanation thereof, no Bank has any fiduciary,
trust, guardian, representative, partnership, joint venturer or other similar
relationship to or with Borrower and no such relationship shall be drawn or
implied from any of the Loan Documents or any actions or inactions of any Bank
hereunder or with respect hereto – and, no Bank has any obligation to Borrower
or any other person relative to administration of any of the Obligations and the
Collateral, or any part or parts thereof, except as otherwise set forth herein.
The covenants, terms and conditions herein contained shall bind, and the
benefits and powers shall inure to, the respective heirs, executors,
administrators, successors and assigns of the parties hereto, as well as any
persons who become bound hereto as a debtor. If two or more persons or entities
have joined as Borrower, each of the persons and entities shall be jointly and
severally obligated to perform the conditions and covenants herein contained.
The term “Bank” shall include any payee of the Obligations hereby secured and
any transferee or assignee thereof, whether by operation of law or otherwise,
and any Bank may transfer, assign or negotiate all or any of the Obligations
secured by this Agreement from time to time without the consent of Borrower and
without notice to Borrower (but subject to the consent of each other Bank and
the execution and delivery by any such transferee or assignee of such documents,
guaranties and agreements, including, without limitation, this Agreement and the
Intercreditor Agreement, as such other Banks may reasonably require) and any
transferee or assignee of any Bank or any transferee or assignee of another may
do the same without Borrower’s consent and without notice to Borrower. Borrower
waives and will not assert against any transferee or assignee of any Bank any
claims, defenses, set-offs or rights of recoupment which Borrower could assert
against a Bank, except defenses which Borrower cannot waive.

12.11 Time of Essence. Time is of the essence for the performance of all of
Borrower’s covenants and agreements (inclusive of the Obligations) set forth in
this Agreement and each of the Loan Documents.

12.12 Amendments in Writing; Integration. All amendments to or terminations of
this Agreement must be in writing and must be executed by each party hereto. All
prior agreements, understandings, representations, warranties and negotiations
between the parties hereto with respect to the subject matter of this Agreement,
if any, are merged into this Agreement and the Loan Documents.

12.13 Counterparts. This Agreement may be executed in any number of counterparts
and by different parties on separate counterparts, each of which, when executed
and delivered, shall be deemed to be an original, and all of which, when taken
together, shall constitute but one and the same Agreement.

12.14 Survival. All covenants, representations and warranties made in this
Agreement shall continue in full force and effect so long as any Obligations
remain outstanding. Notwithstanding anything in this Agreement or the other Loan
Documents to the contrary, the obligations of Borrower to indemnify the Banks as
described in Section 12.1 shall survive until all applicable statute of
limitations periods with respect to actions that may be brought against each
such Bank have run.

12.15 Limited License. During the term of this Agreement, Borrower hereby grants
to each Bank and its Affiliates, a non-exclusive, world-wide, non-transferable,
royalty-free irrevocable license to use the Borrower’s Marks (as herein defined)
solely for and in connection with the general marketing, promotion and
advertising activities of such Bank and its Affiliates. General marketing,
promotion and advertising activities shall include press releases, product
brochures, tombstone ads and other advertising typical in industry practice and
disclosure of Borrower’s Marks on such Bank’s website, including a link to the
Borrower’s website. “Marks” shall mean Borrower’s names, logos, Trademarks,
trade names, service marks and world wide web addresses. Bank shall use
commercially reasonable efforts to cause the appropriate designation “™” or the
registration symbol “®” to be placed adjacent to the Marks in connection with
the use thereof. Notwithstanding the foregoing, no Bank shall be under any
obligation to use any of such Marks. Any marketing, promotion, advertising or
other materials which incorporate Borrower’s Marks shall be submitted to
Borrower for approval prior to publication.

[THE NEXT PAGE IS THE SIGNATURE PAGE]

1

In witness whereof, the parties have caused this agreement to be executed with
authority duly obtained, as of the date first written above.

      PORTFOLIO RECOVERY ASSOCIATES, INC.    
By:     /s/ Steven D. Fredrickson     
Steven D. Fredrickson
President and Chief Executive Officer
Portfolio Recovery Associates, Inc.
120 Corporate Boulevard, Suite 100
Norfolk, VA 23502
 

Witness:
Attn: General Counsel
FAX: 757-554-0586
       /s/ Kevin P. Stevenson     
Print Name: Kevin P. Stevenson
WACHOVIA BANK, NATIONAL ASSOCIATION
  BANK OF AMERICA, N.A.
By: /s/ Paula Smith
  By: /s/ David Doucette
 
   
Name: Paul Smith
Title: Senior Vice President
Address for Notices:
  Name: David Doucette
Title: Senior Vice President
Address for Notices:
Wachovia Bank, National Association
101 West Main Street
Mail Code VA 5263
Norfolk, VA 23510
Attn: Paula H. Smith, Senior Vice President
FAX: (757) 640-5638
  Bank of America, N.A.
One Commercial Place
Commercial Banking, Third Floor
Norfolk, VA 23510
Attn: Peter Schleck, Senior Vice President
FAX: (757) 441-8599
RBC BANK (USA)
  SUNTRUST BANK
By: /s/ Denise M. Howard
  By: /s/ Joel S. Rhew
 
   
Name: Denise M. Howard
Title: Vice President
Address for Notices:
  Name: Joel S. Rhew
Title: Senior Vice President
Address for Notices:
RBC Bank (USA)
555 E. Main Street, Suite 1000
Norfolk, VA 23510
Attn: Denise M. Howard, Vice President
FAX: (757) 892-2045
  SunTrust Bank
150 W. Main Street, Suite 1200
Norfolk, VA 23510
Attn: Joel S. Rhew, Senior Vice President
FAX: (757) 624-5457

Each of the undersigned, having guaranteed pursuant to Unconditional Guaranty
Agreements in favor of each Bank dated May 4, 2007, (“Guarantees”), payment and
performance of the obligations of Borrower to each Bank, hereby acknowledges and
consents to the execution and delivery of this Third Amended and Restated Loan
and Security Agreement and the related Loan Documents and affirms its
obligations under the Guarantees to which it is a party.

PRA Location Services, LLC

     
By:
  /s/ Judith S. Scott
 
   
 
  Judith S. Scott
Authorized Representative of the Sole Member

PRA Holding I, LLC

     
By:
  /s/ Judith S. Scott
 
   
 
  Judith S. Scott
Authorized Representative of the Sole Member

Portfolio Recovery Associates, L.L.C.

     
By:
  /s/ Judith S. Scott
 
   
 
  Judith S. Scott
Authorized Representative of the Sole Member

PRA Receivables Management, LLC

     
By:
  /s/ Judith S. Scott
 
   
 
  Judith S. Scott
Authorized Representative of the Sole Member

PRA Government Services, LLC

     
By:
  /s/ Judith S. Scott
 
   
 
  Judith S. Scott
Authorized Representative of the Sole Member

2

EXHIBIT A

DEFINITIONS

“Accounts” shall have a broad meaning and shall include all accounts (as such
term is defined in Article 9 of the Code) owned by the Borrower and all accounts
in which the Borrower has any rights (including, without limitation, rights to
grant a security interest in accounts owned by other persons), both now existing
and hereafter owned, acquired and arising; and, to the extent not included in
the term accounts as so defined after ascribing a broad meaning thereto, all
accounts receivable, health-care-insurance receivables, credit and charge card
receivables, bills, acceptances, documents, choses in action, chattel paper
(both tangible and electronic), promissory notes and other instruments, deposit
accounts, license fees payable for use of software, commercial tort claims,
letter of credit rights and letters of credit, rights to payment for money or
funds advanced or sold other than through use of a credit card, lottery
winnings, rights to payment with respect to investment property, general
intangibles and other forms of obligations and rights to payment of any nature,
now owing to the Borrower and hereafter arising and owing to the Borrower,
together with (i) the proceeds of all of the accounts and other property and
property rights described hereinabove, including all of the proceeds of
Borrower’s rights with respect to any of its goods and services represented
thereby, whether delivered or returned by customers, and all rights as an unpaid
vendor and lienor, including rights of stoppage in transit and of recovering
possession by any proceedings, including replevin and reclamation, and (ii) all
customer lists, books and records, ledgers, account cards, and other records
including those stored on computer or electronic media, whether now in existence
or hereafter created, relating to any of the foregoing; including, without
limitation, an account established for a bank credit card, retail credit card,
consumer installment loan, defaulted auto loans or lines of credit in the name
of an Account Debtor, as set forth and described in a Purchase Agreement, and
all unpaid balances due from such Account Debtor, together with all available
documents evidencing such Account Debtor’s agreement to make payment of such
unpaid balances, including without limitation each available credit card
application or agreement, and each available promissory note, receivable,
obligation, chattel paper, payment agreement, contract, installment sale
agreement or other obligation or promise to pay of an Account Debtor, all as
described and referred to in a Purchase Agreement.

“Account Debtor” means any person or persons that are an obligor in any
contractual arrangement for amounts due to Borrower, Guarantors or any co-signor
in respect of such contractual arrangement.

“Advance” means an advance of borrowed funds made by the Banks to Borrower
pursuant to this Agreement.

“Affiliate” means, with respect to any person, any person that owns or controls
directly or indirectly such person, any person that controls or is controlled by
or is under common control with such person, and each of such person’s senior
executive officers, directors and partners.

“Agreement” means this Loan and Security Agreement, and any and all amendments,
modifications, renewals, extensions, replacements and substitutions thereof and
therefor.

“Asset Pool” means all Receivables and other Assets, as the context may require,
which Receivables shall all have been purchased from a single creditor and from
which Borrower or Guarantor have purchased such Receivables on the same Business
Day, together with (i) each and every Asset obtained in replacement or
satisfaction of or substitution for, any such Receivable so purchased, (ii) each
and every item of property obtained by Borrower or Guarantor as a result of its
collection activities with respect to any such purchased Receivable, (iii) each
and every item of collateral or security, including all security interests,
liens, guarantees and other interests securing payment of any purchased
Receivable, and all other rights and interests of Borrower or Guarantor with
respect to each purchased Receivable, (iv) each judgment rendered against a
purchased Account Debtor in respect to a Receivable, together with all lien
rights related thereto, (v) Asset Pool Proceeds derived from or paid or payable
with respect thereto, together with any and all earnings thereon, and (vi) each
and every other right, claim and interest associated therewith. With respect to
an Asset Pool: (a) the term “Receivable” shall mean a purchased account
established for a bank credit card, retail credit card, consumer installment
loan, defaulted auto loans or lines of credit in the name of an Account Debtor,
as set forth and described in a Purchase Agreement, and all unpaid balances due
from such Account Debtor, together with (to the extent available) all documents
evidencing such Account Debtor’s agreement to make payment of such unpaid
balances, including, without limitation, each credit card application or
agreement, and each promissory note, receivable, obligation, chattel paper,
payment agreement, contract, installment sale agreement or other obligation or
promise to pay of an Account Debtor, all as described and referred to in a
Purchase Agreement; and (b) the term “Asset” shall mean each purchased
Receivable and any property or other right obtained by Borrower in connection
with collection of any such purchased Receivable or in substitution therefor,
all of which constitutes part of the Asset Pool into which such purchased
Receivable was initially delivered.

“Asset Pool Proceeds” means, with respect to an Asset Pool, any and all
payments, revenues, income, receipts, collections, recoveries and other proceeds
or assets received with respect to such Asset Pool, including, without
limitation, (i) payments of principal, interest, fees, late charges,
insufficient funds charges, guaranty payments and any interest thereon, credit
insurance costs, guaranty fees and other amounts recovered on account of any
Asset in such Asset Pool, and (ii) settlements, compromises, liquidations,
foreclosure proceeds, dispositions, sales, transfers or other proceeds, whether
cash or otherwise, received as a result of or in any way in connection with
collection activities related to any Asset or in connection with the sale of any
Asset constituting a part of such Asset Pool.

“Asset Pool Report” means a report, in a form and substance acceptable to the
Banks, that sets forth each Asset Pool purchased by Borrower in a form
reasonably acceptable to the Banks and that identifies the Eligible Asset Pools.

“Asset Pool Seller” means, with respect to an Asset Pool, the party which has
agreed to sell a specified Asset Pool to Borrower or any Guarantor pursuant to
the terms of a Purchase Agreement.

“Bank Expenses” means all costs and expenses incurred and suffered by the Banks,
or any of them, in connection with the preparation, negotiation, administration
and enforcement of the Loan Documents and their rights and remedies thereunder,
including, without limitation, perfection, audit, inspection, protection and
enforcement of the Banks’ security interests in the Collateral.

“Banks” means Wachovia Bank, National Association, Bank of America, N.A., RBC
Bank (USA), SunTrust Bank, and such other lenders or financial institutions as
may become party to this Agreement as lenders pursuant to the terms hereof, and
their permitted successors, assigns, transferees and the holder of this
Agreement and the other Loan Documents, and “Bank” means any of them.

“Borrower” means Portfolio Recovery Associates, Inc., a Delaware corporation,
and its successors and permitted assigns.

“Borrower’s Books” means all of Borrower’s books and records including, without
limitation, ledgers, journals, spread sheets, business plans, business
projections, tax returns and accompanying worksheets and notes related thereto,
governmental and regulatory filings and reports and all other records concerning
Borrower’s assets and liabilities, the Collateral, business operations and
financial condition; and the term includes media on which such records are
stored or maintained, whether electronic, printed, imbedded in software or other
computer programs or on tape files, and the equipment containing such
information.

“Borrowing Base” means an amount equal to 30% of Estimated Remaining Collections
of all Eligible Asset Pools, as determined by Bank with reference to the most
recent Borrowing Base Report delivered by Borrower.

“Borrowing Percentage” means, with respect to any Bank, the ratio of such Bank’s
Commitment to the aggregate of all the Banks’ Commitments hereunder.

“Business Day” means any day that is not a Saturday, Sunday or other day on
which banks in the Commonwealth of Virginia are authorized or required to close.

“Capitalized Leases” means all leases that have been or should be, in accordance
with GAAP, recorded as capitalized leases.

“Certificate of Borrower” means that certain Certificate of Borrower dated as of
the date hereof, executed by Borrower and delivered to the Banks in connection
with this Agreement with respect to certain representations, warranties,
resolutions and organizational matters.

“Change in Management” shall mean Kevin P. Stevenson and Steven D. Fredrickson
are no longer Chief Financial Officer and President or Chief Executive Officer
of Borrower, respectively.

“Close” or “Closing” means the completion of the conditions precedent to the
initial Credit Extension.

“Closing Date” means the date of this Agreement.

“Code” means the Uniform Commercial Code as in effect, from time to time, in the
Commonwealth of Virginia.

“Collateral” means the property and property rights described on Exhibit C and
all Negotiable Collateral and Intellectual Property Collateral to the extent not
described on Exhibit C.

“Commitment” means, with respect to any Bank, the dollar amount of the
commitment made by such Bank to Borrower pursuant to this Agreement. For the
avoidance of doubt, (i) the initial Commitment of Bank of America, N.A., shall
be $130,001,000, under the Revolving Facility and $37,451,294 under the
Non-Revolving Sublimit, (ii) the initial Commitment of Wachovia Bank, National
Association, shall be $100,000,000 under the Revolving Facility and $33,039,382
under the Non-Revolving Sublimit, (iii) the initial Commitment of RBC Bank
(USA) shall be $39,999,000 under the Revolving Facility and $19,215,206 under
the Non-Revolving Sublimit, and (iv) the initial Commitment of SunTrust Bank
shall be $70,000,000 under the Revolving Facility and $10,294,118 under the
Non-Revolving Sublimit.

“Committed Line” means Credit Extensions under the Revolving Facility and the
Non-Revolving Sublimit of up to the lesser of: (i) Three Hundred Forty Million
Dollars ($340,000,000) and (ii) thirty percent (30%) of Borrower’s and Portfolio
Recovery Associates, L.L.C.’s Estimated Remaining Collections of all Eligible
Asset Pools.

“Contingent Obligation” or “Contingent Liabilities” means, as applied to any
person, any direct or indirect liability, contingent or otherwise, of that
person with respect to (i) any account, instrument, chattel paper, document,
general intangible, indebtedness, lease, dividend, letter of credit, letter of
credit right or other obligation of another person, including, without
limitation, any such obligation directly or indirectly guaranteed, endorsed,
co-made or discounted or sold with recourse by that person, or in respect of
which that person is otherwise directly or indirectly liable; (ii) any
obligations with respect to undrawn letters of credit issued for the account of
that person; and (iii) all obligations arising under any interest rate, currency
or commodity swap agreement, interest rate cap agreement, interest rate collar
agreement, or other agreement or arrangement designated to protect a person
against fluctuation in interest rates, currency exchange rates or commodity
prices; provided, however, that the term “Contingent Obligation” shall not
include endorsements for collection or deposit in the ordinary course of
business. The amount of any Contingent Obligation shall be deemed to be an
amount equal to the stated or determined amount of the primary obligation in
respect of which such Contingent Obligation is made or, if not stated or
determinable, the maximum reasonably anticipated liability in respect thereof as
determined by such person in good faith; provided, however, that such amount
shall not in any event exceed the maximum amount of the obligations under the
guarantee or other support arrangement.

“Copyrights” means any and all copyright rights, copyright applications,
copyright registrations and like protections in each work of authorship and
derivative work thereof, both published and unpublished and whether or not the
same also constitutes a trade secret, now existing and hereafter arising,
created, acquired or held.

“Credit Extension” means each Advance, or any other extension of credit by any
Bank for the benefit of Borrower hereunder.

“Default Rate” means a rate of interest per annum equal to the contract rate of
interest defined as the “Default Rate” in the Promissory Note, and if there is
more than one Promissory Note, it shall mean a rate of interest per annum equal
to the highest of the contract rates of interest defined in the Promissory Notes
as a “Default Rate”.

“EBITDA” means net income, less income or plus loss from discontinued operations
and extraordinary items, plus income taxes, plus interest expense, plus
depreciation, depletion, amortization (including payments applied to principal
on finance receivables) and other non-cash charges.

“Eligible Asset Pool” means those existing Asset Pools accepted by the Banks at
Closing and newly acquired Asset Pools of Borrower and Portfolio Recovery
Associates, L.L.C. acquired from Asset Pool Sellers not affiliated with the
Borrower or Guarantor, that in each case, meet all of the following
requirements:

(i) the Accounts in such Asset Pool, taken as a whole, comply in all material
respects with all applicable laws and regulations, including, but not limited
to, truth in lending and credit disclosure laws and regulations;

(ii) all amounts and information appearing on the applicable Asset Pool Report
furnished to the Banks in connection therewith are true and correct in all
material respects;

(iii) Borrower or Portfolio Recovery Associates, L.L.C. has good and marketable
title and has the right to pledge, assign and deliver the Assets of such Asset
Pool, free from all liens, claims, encumbrances or security interests
whatsoever;

(iv) no more than one percent (1%) of the number of Accounts in such Asset Pool
constitute Accounts with respect to which the Account Debtor thereon or any
guarantor thereof is employed by or related to Borrower or any Guarantor or is
Borrower or any Guarantor;

(v) to the best knowledge of Borrower and Guarantor no condition exists that
materially or adversely affects the Level Yield of the Asset Pool; and

(vi) since the acquisition of the Asset Pool by Borrower or Portfolio Recovery
Associates, L.L.C., no sale of any Account within the Asset Pool has occurred
except arms length sales to non-affiliated third parties.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time, and the regulations promulgated and rulings issued
thereunder.

“ERISA Affiliate” means any Person that for purposes of Title IV of ERISA is a
member of the Borrower’s controlled group, or under common control with the
Borrower, within the meaning of Section 414 of the Internal Revenue Code or
Section 4001 of ERISA.

“ERISA Event” means (a)(i) the occurrence of a reportable event, within the
meaning of Section 4043 of ERISA, with respect to any Plan unless the 30-day
notice requirement with respect to such event has been waived by the PBGC, or
(ii) the requirements of subsection (1) of Section 4043(b) of ERISA (without
regard to subsection (2) of such Section) are met with respect to a contributing
sponsor, as defined in Section 4001(a)(13) of ERISA, of a Plan, and an event
described in paragraph (9), (10), (11), (12) or (13) of Section 4043(c) of ERISA
is reasonably expected to occur with respect to such Plan within the following
30 days; (b) the application for a minimum funding waiver with respect to a
Plan; (c) the provision by the administrator of any Plan of a notice of intent
to terminate such Plan pursuant to Section 4041(a)(2) of ERISA (including any
such notice with respect to a plan amendment referred to in Section 4041(e) of
ERISA); (d) the cessation of operations at a facility of the Borrower or any
ERISA Affiliate in the circumstances described in Section 4062(e) of ERISA;
(e) the withdrawal by the Borrower or any ERISA Affiliate from a Multiple
Employer Plan during a plan year for which it was a substantial employer, as
defined in Section 4001(a)(2) of ERISA; (f) the conditions for the imposition of
a lien under Section 302 of ERISA shall have been met with respect to any Plan;
(g) the adoption of an amendment to a Plan requiring the provision of security
to such Plan pursuant to Section 307 of ERISA; (h) the institution by the PBGC
of proceedings to terminate a Plan pursuant to Section 4042 of ERISA, or the
occurrence of any event or condition described in Section 4042 of ERISA that
constitutes grounds for the termination of, or the appointment of a trustee to
administer, a Plan; or (i)(A) the IRS or the United States Department of Labor
determines that a breach of fiduciary duty under ERISA or a prohibited
transaction under ERISA or the IRC has occurred with respect to the Borrower or
any ERISA Affiliate and neither the Borrower nor any ERISA Affiliate contests
such determination, or (B) a court of competent jurisdiction enters a final,
non-appealable order determining that a breach of fiduciary duty under ERISA or
a prohibited transaction under ERISA or the IRC has occurred with respect to the
Borrower or any ERISA Affiliate.

“Estimated Remaining Collections” means the aggregate gross remaining cash
collections which Borrower or Portfolio Recovery Associates, L.L.C. anticipate
to receive from an Asset Pool or as referred to by Borrower or Portfolio
Recovery Associates, L.L.C. as the “Level Yield,” determined and reported by
Borrower or Portfolio Recovery Associates, L.L.C. pursuant to their financial
statements and other reporting to the Banks. Such remaining book balance shall
be calculated by Borrower or Portfolio Recovery Associates, L.L.C. (as the case
may be) in accordance with GAAP and in a manner consistent with past practice
and with the methodology employed in the reporting of Estimated Remaining
Collections in Borrower’s public filings. Provided, however, the manner and
method of computing Estimated Remaining Collections and all assumptions made in
connection therewith shall be explained to each Bank in full detail upon any
Bank’s request. Any deviation from the current method and assumptions used in
computing Estimated Remaining Collections must be acceptable to each Bank in its
sole and absolute discretion.

“Event of Default” has the meaning assigned in Section 8.

“Funded Debt” means all outstanding liabilities for borrowed money and other
interest-bearing liabilities, including current and long-term debt, less the
non-current portion of Subordinated Liabilities. 

“Funded Debt to EBITDA Ratio” means, on a consolidated basis, a ratio of Funded
Debt to EBITDA. This ratio will be calculated at the end of each reporting
period for which the Banks require financial statements from Borrower, using the
results of the twelve-month period ending with that reporting period. 

“GAAP” means generally accepted accounting principles and practices in effect in
the United States from time to time as promulgated by the American Institute of
Certified Public Accounts.

“Guarantor” means Portfolio Recovery Associates, L.L.C., PRA Holding I, LLC, PRA
Location Services, LLC, PRA Government Services, LLC, PRA Receivables
Management, LLC, PRA Holding II, LLC, and PRA Bankruptcy Services, LLC jointly
and severally.

“Governmental Authority” means any nation or government, any state or other
political subdivision thereof, and any organization exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.

“Indebtedness” means (a) all liabilities which would be reflected on a balance
sheet prepared in accordance with GAAP, (b) all indebtedness for borrowed money
or the deferred purchase price of property or services, including without
limitation reimbursement and other obligations with respect to surety bonds and
letters of credit, (c) all obligations evidenced by notes, bonds, debentures or
similar instruments, (d) all capital lease obligations and (e) all Contingent
Obligations.

“Insolvency Proceeding” means any proceeding commenced by or against any person
or entity under any provision of the United States Bankruptcy Code, as amended,
or under any other bankruptcy or insolvency law, including assignments for the
benefit of creditors, formal or informal moratoria, compositions, extension
generally with its creditors, or proceedings seeking reorganization, arrangement
or other relief.

“Intellectual Property Collateral” means all of Borrower’s right, title and
interest in and to its intellectual property, including without limitation, the
following: (i) Copyrights, Trademarks and Patents; (ii) any and all trade
secrets, and any and all intellectual property rights in software and software
products now or hereafter existing, created, acquired or held during the term of
this Agreement; (iii) any and all design rights which may be available to
Borrower now or hereafter existing, created, acquired or held during the term of
this Agreement; (iv) any and all mask works or similar rights now or hereafter
existing, created, acquired or held during the term of this Agreement; (v) any
and all claims for damages by way of past, present and future infringement of
any of the rights included above, with the right, but not the obligation, to sue
for and collect such damages for said use or infringement of the intellectual
property rights identified above; (vi) all licenses or other rights to use any
of the Copyrights, Patents or Trademarks, and all license fees and royalties
arising from such use to the extent permitted by such license or rights;
(vii) all amendments, renewals, re-issues, divisions, continuations and
extensions of any of the Copyrights, Trademarks or Patents; and (viii) all
proceeds and products of the foregoing, including without limitation all
payments under insurance or any indemnity or warranty payable in respect of any
of the foregoing.

“Intercreditor Agreement” means that certain Intercreditor Agreement of even
date herewith, by and between the Banks, and any successor instrument thereto
with respect to the relative rights and interests of the Banks in and to the
Collateral.

“Interest Expense” means the total of the costs of advances outstanding under
Indebtedness including (i) interest charges, (ii) capitalized interest,
(iii) the interest component of Capitalized Leases, (iv) fees payable in respect
of letters of credit and letters of guarantee, and (v) discounts incurred and
fees payable in respect of bankers’ acceptances.

“Investment” means any beneficial ownership of (including stock, membership
interest, partnership interest or other securities) any person, or any loan,
advance or capital contribution to any person.

“IRC” means the Internal Revenue Code of 1986, as amended, and the regulations
thereunder.

“IRS” means the United States Internal Revenue Service.

“Knowledge” means actual knowledge or such level of knowledge or awareness as
would be obtained or should have been known at the time by a prudent business
person under substantially similar circumstance after diligent investigation.

“Lien” means any mortgage, lien, deed of trust, deed to secure debts, charge,
pledge, security interest or other encumbrance and the term “security interest”
and Lien shall be interchangeable, as necessary or appropriate.

“Loan Documents” means, collectively, this Agreement, the Intercreditor
Agreement, any instruments, including promissory notes, executed and delivered
by Borrower to any Bank, and any one or more of the following entered into by
Borrower and any Bank, or by Borrower for the benefit of any Bank, or by another
person and any Bank or by another person for benefit of any Bank, in connection
with the Agreement or any of the Obligations, together with any and all
renewals, extensions, amendments, modifications, replacements and substitutions
thereof and therefor: mortgages, deeds to secure debt, deeds of trust, security
agreements, negative pledge agreements, pledge agreements, guaranty agreements,
control agreements, hypothecation agreements, documents, agreements and other
records.

“Material Adverse Effect” means a material adverse effect on (i) the business
operations or condition (financial or otherwise) of Borrower and its
Subsidiaries taken as a whole or (ii) the ability of Borrower to repay the
Obligations or otherwise perform its obligations under the Loan Documents as and
when required thereunder.

“Material Agreements” has the meaning assigned in the Certificate of Borrower.

“Multiple Employer Plan” means a single employer plan, as defined in Section
4001(a)(15) of ERISA, that (a) is maintained for employees of the Borrower or
any ERISA Affiliate and at least one Person other than the Borrower and the
ERISA Affiliates or (b) was so maintained and in respect of which the Borrower
or any ERISA Affiliate could have liability under Section 4064 or 4069 of ERISA
in the event such plan has been or were to be terminated.

“Negotiable Collateral” means all of Borrower’s present and future
letters-of-credit and letter-of-credit rights of which it is a beneficiary,
instruments (including promissory notes), drafts, securities, documents of title
and chattel paper (including electronic chattel paper), and Borrower’s Books
relating to any of the foregoing.

“Net Finance Receivable” means the remaining book balance of Borrower’s or a
Guarantor’s net investment in all Asset Pools or as referred to by Borrower as
the “unamortized portfolio price”, determined and reported by Borrower pursuant
to its consolidated financial statements and other reporting provided to the
Banks. Such remaining book balance shall be calculated by Borrower in accordance
with GAAP and in a manner consistent with past practice and with the manner of
calculation of Net Finance Receivable in Borrower’s public filing and such
amount shall be consistent with the amount actually reported in Borrower’s
public filings.

“Net Income” means total revenues minus total expenses.

“Non-Revolving Sublimit” means the portion of the Revolving Facility available
to Borrower for non-revolving fixed rate borrowings in the aggregate amount not
to exceed $100,000,000.00.

“Non-Revolving Maturity Date” means May 4, 2012 or such later date to which all
the Banks may agree in their sole and absolute discretion.

“Obligations” means all indebtedness, including principal, interest, fees,
premiums, penalties, charges, Bank Expenses and other amounts owed to any Bank
by Borrower pursuant to this Agreement, the other Loan Documents and any other
agreement, document and record, both absolute and contingent, due and to become
due, now existing and hereafter arising, including any interest and fees that
accrue after the commencement of an Insolvency Proceeding and including any
indebtedness, liability and obligation now owing and any indebtedness, liability
and obligation hereafter arising and owing from Borrower to others that any Bank
has obtained or may in the future obtain by assignment or otherwise.

“Patents” means all patents, patent applications and like protections including
without limitation improvements, divisions, continuations, renewals, reissues,
extensions and continuations-in-part of the same.

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

“Periodic Payments” means all installment and similar recurring payments that
Borrower may now be obligated to pay and may hereafter become obligated to pay
to the Banks, or any of them, pursuant to the terms and provisions of any
instrument, agreement, document and record now in existence and which may
hereafter come into existence between Borrower and any Bank.

“Permitted Acquisitions” means acquisitions of all or substantially all of the
assets or 100% of the capital stock of another entity (the “Acquired Business”)
(including by (i) merger of the Acquired Business with Borrower or a Subsidiary
of Borrower so long as the survivor of such merger is, or becomes at such time,
a Guarantor and pledges on a first priority basis all its assets to secure the
Obligations in the same manner as the other Guarantors, although in the case of
any such merger which involves Borrower, Borrower shall be the surviving
corporation or (ii) means of a joint venture where Borrower or a Subsidiary owns
at least fifty percent (50%) of the equity interests of such joint venture),
provided that the sum of the aggregate cash consideration plus the aggregate
fair market value of all other consideration paid by Borrower or its
Subsidiaries (including any indebtedness issued, incurred or assumed by Borrower
or any of its Subsidiaries and any capital stock, issued by Borrower) in
connection with any Permitted Acquisitions in any Borrower fiscal year shall not
exceed in the aggregate Thirty Million Dollars ($30,000,000), without the prior
written consent of all Banks.

“Permitted Dividends” means dividends lawfully declared and paid which (i) would
not cause a breach of this Agreement if paid, (ii) do not exceed in the
aggregate Twenty Million Dollars ($20,000,000) in any Borrower fiscal year, and
(iii) would not have resulted in a breach of Borrower’s Funded Debt to EBITDA
ratio or minimum Tangible Net Worth had the dividend been declared and paid on
the last day of the most recent month.

“Permitted Indebtedness” means: (i) Indebtedness of Borrower in favor of the
Banks arising under this Agreement or any other Loan Document; (ii) Indebtedness
existing on the Closing Date which is disclosed in the Schedule;
(iii) Indebtedness not to exceed in the aggregate in any fiscal year 2% of
Borrower’s Tangible Net Worth secured by a lien described in clause (iii) of the
defined term “Permitted Liens”, provided such Indebtedness does not exceed the
lesser of the cost or fair market value of the Equipment financed with such
Indebtedness and provided Borrower gives the Banks right of first refusal to
provide such financing; (iv) Subordinated Liabilities; (v) Indebtedness of
Borrower in connection with Capitalized Leases with any Bank or any Affiliate of
any Bank; and (vi) Indebtedness of Borrower owed to any Bank or any Affiliate of
any Bank in connection with any credit card, commercial paper or interest rate
protection agreement or program.

“Permitted Investment” means: (i) Investments existing on the Closing Date
disclosed in the Certificate of Borrower; (ii) (A) marketable direct obligations
issued or unconditionally guaranteed by the United States of America or any
agency or any State thereof maturing within one year from the date of
acquisition thereof, (B) commercial paper maturing no more than one year from
the date of creation thereof and currently having a rating of at least A-2 or
P-2 from either Standard & Poor’s Corporation or Moody’s Investors Service,
(C) certificates of deposit maturing no more than one year from the date of
investment therein issued by a Bank, and (D) any Bank’s money market accounts;
(iii) Investments accepted in connection with Permitted Transfers; (iv)
Investments consisting of (A) travel advances and employee relocation loans and
other employee loans and advances in the ordinary course of business, and
(B) loans to employees, officers or directors relating to the purchase of equity
securities of Borrower or its Subsidiaries pursuant to employee stock purchase
plan agreements approved by Borrower’s board of directors; (v) Investments
(including debt obligations) received in connection with the bankruptcy or
reorganization of customers or suppliers and in settlement of delinquent
obligations of, and other disputes with, customers or suppliers arising in the
ordinary course of Borrower’s business; (vi) Investments consisting of notes
receivable of, or prepaid royalties and other credit extensions, to customers
and suppliers who are not Affiliates, in the ordinary course of business; and
(vii) repurchase of stock of the Borrower, except that a repurchase shall only
be permitted if, at the time of the repurchase, such repurchase amount, when
combined with other repurchases in the prior twelve (12) month period does not
exceed One Hundred Million Dollars ($100,000,000) and if, at the time of the
repurchase, no Event of Default has occurred, is continuing or would exist after
giving effect to the repurchase.

“Permitted Liens” means the following: (i) any Liens existing on the Closing
Date and disclosed in the Schedule or arising under this Agreement or the other
Loan Documents; (ii) Liens for taxes, fees, assessments or other governmental
charges or levies, either not delinquent or being contested in good faith by
appropriate proceedings and for which Borrower maintains adequate reserves,
provided the same have no priority over any of the Banks’ security interests;
(iii) Liens securing the Indebtedness not to exceed the amount described in
(iii) of the definition of Permitted Indebtedness (A) upon or in any Equipment
acquired or held by Borrower or any of its Subsidiaries to secure the purchase
price of such Equipment or indebtedness incurred solely for the purpose of
financing the acquisition of such Equipment, or (B) existing on such Equipment
at the time of its acquisition, provided that the Lien is confined solely to the
property so acquired and improvements thereon, and the proceeds of such
Equipment, provided that, to the extent not specifically prohibited by the terms
of such financings, Borrower shall grant and pledge to the Banks a valid,
perfected security interest which is second in priority to any lien granted
under this provision; and (iv) Liens incurred in connection with the extension,
renewal or refinancing of the indebtedness secured by Liens of the type
described in clauses (i) through (iii) above, provided that any extension,
renewal or replacement Lien shall be limited to the property encumbered by the
existing Lien and the principal amount of the indebtedness being extended,
renewed or refinanced does not increase.

“Permitted Transfer” means the conveyance, sale, lease, transfer or disposition
by Borrower or any Subsidiary of: (i) Assets, Accounts or Inventory in the
ordinary course of business and in the ordinary course of portfolio management,
which may include sales from portfolios acquired under joint bids where the
Borrower is the lead purchaser; (ii) non-exclusive licenses and similar
arrangements for the use of the property of Borrower or its Subsidiaries in the
ordinary course of business; (iii) surplus, worn-out or obsolete Equipment, or
(iv) the capital stock of Borrower for fair market value.

“Plan” means a Single Employer Plan or a Multiple Employer Plan.

“Postponed Debt” means the total Indebtedness that is fully postponed and
subordinated, on terms satisfactory to the Banks, to the obligations owing to
the Banks.

“Promissory Note” means any promissory note or other instrument of Borrower in
favor of any Bank evidencing any indebtedness of Borrower to any Bank under this
Agreement or evidencing any of the other Obligations, together with any
amendments, modifications, extensions, renewals, substitutions or replacements
thereto or therefor.

“Pro Rata” means, with respect to a Bank as of any date of determination, such
Bank’s allocable portion of outstanding Credit Extensions under the Revolving
Facility and the Non-Revolving Sublimit expressed as a fraction, the numerator
of which is such Bank’s total outstanding Credit Extensions and the denominator
of which is the aggregate of all outstanding Credit Extensions under this
Agreement, as of such date of determination.

“Purchase Agreement” means the agreement between Borrower or any Guarantor and
any Asset Pool Seller for the purchase of an Asset Pool.

“Purchase Price” shall mean the actual purchase price paid by Borrower or a
Guarantor for an Asset Pool, pursuant to the terms of a Purchase Agreement.

“Requirement of Law” means as to any person, the certificate of incorporation
and by-laws or other organizational or governing documents of such person, and
any law, treaty, rule, or regulation, or determination of an arbitrator or a
court or other Governmental Authority, in each case applicable to or binding
upon such person or any of its properties or to which such person or any of its
properties is subject, either individually, or jointly or collectively with
another person or persons.

“Responsible Officer” means each of the Chief Executive Officer, the Chief
Operating Officer, the Chief Financial Officer and the Controller of Borrower.

“Revolver Maturity Date” means May 2, 2011, or any extension thereof pursuant to
Section 2.7 hereof.

“Revolving Facility” means the facility under which Borrower may request the
Banks to issue Advances, as specified in Section 2 under subsection entitled
“Revolving Facility”.

“Schedule” means the schedule of exceptions attached hereto, if any.

“Shareholders’ Equity” means the total of (i) share capital (excluding
redeemable preferred shares and treasury stock), (ii) contributed surplus,
(iii) retained earnings and (iv) Postponed Debt; and for non-corporate
organizations such as partnerships or limited liability companies, equity
accounts similar to those described herein for corporations.

“Single Employer Plan” means a single employer plan, as defined in
Section 4001(a)(15) of ERISA, that (a) is maintained for employees of the
Borrower or any ERISA Affiliate and no Person other than the Borrower and the
ERISA Affiliates or (b) was so maintained and in respect of which the Borrower
or any ERISA Affiliate could have liability under Section 4069 of ERISA in the
event such plan has been or were to be terminated.

“Software Products” and “Software” are interchangeable and mean software,
computer source codes and other computer programs.

“Subordinated Liabilities” means liabilities subordinated to Borrower’s
obligations to the Banks in a manner acceptable to the Banks in each Bank’s sole
discretion.

“Subsidiary” means any registered organization or other organization (1) the
majority (by number of votes) of the outstanding voting interests of which is at
the time owned or controlled by Borrower, or by one or more Subsidiaries of
Borrower, or Borrower and one or more Subsidiaries of Borrower, or (2) otherwise
controlled by or within the control of Borrower or any Subsidiary.

“Tangible Net Worth” means the value of Borrower’s total assets (including
leaseholds and leasehold improvements and reserves against assets but excluding
goodwill, patents, trademarks, trade names, organization expense, unamortized
debt discount and expense, capitalized or deferred research and development
costs, deferred marketing expenses, and other like intangibles, and monies due
from affiliates, officers, directors, employees, shareholders, members or
managers of Borrower) less total liabilities, including but not limited to
accrued and deferred income taxes, but excluding the non-current portion of
Subordinated Liabilities.

“Total Liabilities” or “Total Debt “ means all liabilities, including Contingent
Liabilities, exclusive of deferred tax liabilities and Postponed Debt.

“Trademarks” means any trademark and service mark rights, whether registered or
not, applications to register and registrations of the same and like
protections, and the entire goodwill of the business of Borrower connected with
and symbolized by such trademarks.

“Unused Facility” means an amount equal to the Committed Line then in effect
less the aggregate amount of Advances outstanding under the Revolving Facility
and the Non-Revolving Sublimit and any other deductions from the Committed Line
as provided in the Agreement.

3

EXHIBIT B

          LOAN PAYMENT/ADVANCE REQUEST FORM
    DEADLINE FOR SAME DAY PROCESSING IS 10:00 A.M., E.T.
   
TO:      
  and   DATE:
 
     

FAX #:     
  and   TIME:
 
       

                                     
FROM:
 
 
 
 
 

CLIENT NAME (BORROWER)
 
 
 
 
 

REQUESTED BY:
 
 
 
 
 

AUTHORIZED SIGNATURE:
 
 
 
 
 

PHONE NUMBER:
 
 
 
 
 
FROM BANK OF AMERICA ACCT #       TO ACCOUNT #                 FROM WACHOVIA
ACCT #       TO ACCOUNT #                 FROM RBC BANK (USA) ACCT #       TO
ACCOUNT #                 FROM SUNTRUST BANK ACCT#       TO ACCOUNT #          
      CHECK ONE: ?Revolving Facility   ?Non-Revolving Sublimit                
REQUESTED TRANSACTION TYPE               REQUEST DOLLAR AMOUNT              
 
  Bank of
America  
  Wachovia Bank

  RBC Bank (USA)

  SunTrust Bank

PRINCIPAL INCREASE (ADVANCE)
        $       $       $       $                                
PRINCIPAL PAYMENT (ONLY)
        $       $       $       $                                
INTEREST PAYMENT (ONLY)
        $       $       $       $                                
PRINCIPAL AND INTEREST (PAYMENT)
        $       $       $       $                                
OTHER INSTRUCTIONS:
 
 
 
 
 
All representations and warranties of Borrower stated in the Loan and Security
Agreement are true, correct and
complete in all respects as of the date of this Loan Payment/Advance Request;
provided, however, that those
representations and warranties expressly referring to another date shall be
true, correct and complete as of such

date.
 
 
 
 
 

BANK USE ONLY
 
 
 
 
 

TELEPHONE REQUEST:
 
 
 
 
 

 
 
 
 
 
 
The following person is authorized to request the loan payment transfer/loan
advance on the advance designated

account and is known to me.
 
 
 
 
 

Authorized Requester
                      Phone #  

Received By (Bank)
                      Phone #  

Authorized Signature (Bank)
 
 
 
 
 

 
 
 
 
 
 

4

EXHIBIT C

     
DEBTOR:
SECURED PARTIES:
  PORTFOLIO RECOVERY ASSOCIATES, INC.
BANK OF AMERICA, N.A. WACHOVIA BANK, NATIONAL ASSOCIATION,
RBC BANK (USA), SUNTRUST BANK

COLLATERAL DESCRIPTION ATTACHMENT TO LOAN AND SECURITY AGREEMENT

All personal property owned by Borrower and all personal property in which
Borrower has a property interest, both presently existing and hereafter created,
written, produced, developed, acquired and arising, of every nature, kind and
description, wherever located and notwithstanding in whose custody and
possession any of the foregoing may be at any time or times, including, but not
limited to:

(i)   all accounts (as such term is defined in Article 9 of the Uniform
Commercial Code in effect from time to time in the Commonwealth of Virginia)
owned by the Borrower and all accounts in which the Borrower has any rights
(including, without limitation, rights to grant a security interest in accounts
owned by other persons), both now existing and hereafter owned, acquired and
arising and, to the extent not included in the term accounts as so defined after
ascribing a broad meaning thereto, all accounts receivable,
health-care-insurance receivables, credit and charge card receivables, bills,
acceptances, documents, choses in action, chattel paper (both tangible and
electronic), promissory notes and other instruments, deposit accounts, license
fees payable for use of software, commercial tort claims, letter of credit
rights and letters of credit, rights to payment for money or funds advanced or
sold other than through use of a credit card, lottery winnings, rights to
payment with respect to investment property, general intangibles and other forms
of obligations and rights to payment of any nature, now owing to the Borrower
and hereafter arising and owing to the Borrower, together with (1) the proceeds
of all of the accounts and other property and property rights described
hereinabove, including all of the proceeds of Borrower’s rights with respect to
any of its goods and services represented thereby, whether delivered or returned
by customers, and all rights as an unpaid vendor and lienor, including rights of
stoppage in transit and of recovering possession by any proceedings, including
replevin and reclamation, and (2) all customer lists, books and records,
ledgers, account cards, and other records including those stored on computer or
electronic media, whether now in existence or hereafter created, relating to any
of the foregoing; including, without limitation, any account established for a
bank credit card, retail credit card, consumer installment loan, defaulted auto
loans or lines of credit in the name of an Account Debtor, as set forth and
described in a Purchase Agreement, and all unpaid balances due from such Account
Debtor, together with all available documents evidencing such Account Debtor’s
agreement to make payment of such unpaid balances, including without limitation
each available credit card application or agreement, and each available
promissory note, receivable, obligation, chattel paper, payment agreement,
contract, installment sale agreement or other obligation or promise to pay of an
Account Debtor, all as described and referred to in a Purchase Agreement,
together with any property or other right obtained by Borrower in connection
with collection of any account or in substitution therefor, all of which
constitutes a part of the Asset Pool into which such Account was initially
delivered;

(ii)   all now existing and hereafter acquired Asset Pools and Asset Pool
Proceeds, as defined in this Agreement;

(iii)   all rights in and to each Purchase Agreement, as defined in this
Agreement;

(iv)   all now existing and hereafter acquired software, computer source codes,
computer programs embedded in goods that consist solely of the medium in which
the program is embedded and other computer programs and supporting information
(collectively, the “Software Products”), and all common law and statutory
copyrights and copyright registrations, applications for registration, now
existing and hereafter arising, United States of America and foreign, obtained
and to be obtained on or in connection with the Software Products, and any parts
thereof and any underlying and component elements of the Software Products,
together with the right to copyright and all rights to renew and extend such
copyrights and the right (but not the obligation) of Bank to sue in its own name
and in the name of the Borrower for past, present and future infringements of
copyright;

(v)   all now existing and hereafter acquired goods, including, without
limitation, fixtures, equipment and inventory;

(vi)   all now existing and hereafter arising rights in oil, gas or other
minerals before extraction;

(vii)   all now existing and hereafter arising guarantees and other supporting
obligations, together with the security therefor;

(viii)   all now existing and hereafter arising copyrights, trade secrets,
trademarks, service marks, trade names and service names and the goodwill
associated therewith;

(ix)   all now existing and hereafter arising (a) patents and patent
applications filed in the United States Patent and Trademark Office or any
similar office of any foreign jurisdiction, and interests under patent license
agreements, including, without limitation, the inventions and improvements
described and claimed therein, (b) licenses pertaining to any patent whether
Borrower is licensor or licensee, (c) income, royalties, damages, payments,
accounts and accounts receivable now due and those hereafter arising and due
under and with respect thereto, including, without limitation, damages and
payments for past, present and future infringements thereof, (d) the right (but
not the obligation) to sue for past, present and future infringements thereof,
(e) rights corresponding thereto throughout the world in all jurisdictions in
which such patents have been issued or applied for, and (f) the reissues,
divisions, continuations, renewals, extensions and continuations-in-part with
any of the foregoing (all of the foregoing patents and applications and
interests under patent license agreements, together with the items described in
clauses (a) through (f) in this paragraph are sometimes herein individually and
collectively referred to as the “Patents”);

(x)   one hundred percent (100%)of the limited liability company membership
interests in Portfolio Recovery Associates, L.L.C., a Delaware limited liability
company, PRA Location Services, LLC, a Delaware limited liability company, PRA
Government Services, LLC, a Delaware limited liability company, PRA Receivables
Management, LLC, a Virginia limited liability company, as well as any interest
whatsoever of Debtor in any entity, regardless of the form of such entity,
whether such interest is now owned or hereafter acquired, whether certificated,
uncertificated or in some other form or evidenced in some other manner or method
or later becomes certificated, owned and held by Debtor or owned by Debtor and
held on Debtor’s behalf and for the account of Debtor by some other person or
entity, together with all now existing and hereafter arising property and
property rights and benefits accruing and payable thereunder or otherwise
arising therefrom or related thereto, including, without limitation, all general
intangibles and all payments, cash, monies, interest, payments, dividends,
distributions, insurance proceeds, condemnation proceeds and other proceeds; and

(xi)   all now existing and hereafter arising accessions, products and proceeds,
including, without limitation, insurance proceeds and condemnation proceeds, of
any and all of the foregoing property and property rights.

5

EXHIBIT D

                  Bank of America, N.A. Wachovia Bank,
  BORROWING BASE CERTIFICATE National Association   RBC   (Estimated Remaining
Collections of All Bank (USA) SunTrust Bank
  Eligible Asset Pools)                 Lenders: Bank of America, N.A.,
Borrower: Portfolio Recovery Associates,
  Wachovia Bank, National Association, Inc.       RBC Bank (USA), SunTrust Bank
Credit Line Amount:
 
 
 

[Revolving and
Non-Revolving]
 
$340,000,000  

 

ESTIMATED REMAINING COLLECTIONS
            1. Borrower’s and Portfolio Recovery Associates,
        L.L.C.’s Estimated Remaining Collections of all Eligible
        Asset Pools identified in the attached Asset Pool Report
        (a) Bank of America
            (b) Wachovia Bank
           
(c)
  RBC Bank (USA)  
 

(d)
  SunTrust Bank  
 
2. Loan Value of #1 (a) (30% of #1(a))
        Loan Value of #1 (b) (30% of #1(b))
        Loan Value of #1 (c) (30%) of #1(c))
        Loan Value of #1 (d) (30%) of #1(d))
       
BALANCES
 
 
 
3. Maximum Credit Line [Revolving and Non-Revolving]
    340,000,000  
 
                (a) Bank of America
            (b) Wachovia Bank
            (c) RBC Bank (USA)
            (d) SunTrust Bank
            4. Total Permissible Borrowings on Credit Line
        [Revolving and Non-Revolving] (Lesser of #2 or #3)
        (a) Bank of America
            (b) Wachovia Bank
            (c) RBC Bank (USA)
            (d) SunTrust Bank
            5. Present balance owing on Line of Credit [Revolving
        and Non-Revolving]
            (a) Bank of America
            (b) Wachovia Bank
            (c) RBC Bank (USA)
            (d) SunTrust Bank
            6. RESERVE POSITION (#4 minus #5)
            (a) Bank of America
            (b) Wachovia Bank
            (c) RBC Bank (USA)
            (d) SunTrust Bank
           

The undersigned represents and warrants that the foregoing is true, accurate and
complete as of the date indicated below, and that the information reflected in
this Borrowing Base Certificate complies with the representations and warranties
set forth in the Loan Agreement between the undersigned, Bank of America, N.A.,
Wachovia Bank, National Association, RBC Bank (USA), and SunTrust Bank.

          Portfolio Recovery Associates, Inc.
  Date: __________________
By:
 
 

 
  Steven D. Fredrickson
President and Chief Executive Officer  

6

EXHIBIT E

      Bank of America, N.A.     Wachovia Bank, National Association     RBC Bank
(USA)    
SunTrust Bank
  COMPLIANCE CERTIFICATE

TO: BANK OF AMERICA, N.A, WACHOVIA BANK, NATIONAL ASSOCIATION, RBC BANK (USA),
and SunTrust Bank (the “Banks”)

FROM: PORTFOLIO RECOVERY ASSOCIATES, INC.

The undersigned authorized officer of Portfolio Recovery Associates, Inc.
(“Borrower”) hereby certifies that in accordance with the terms and conditions
of the Third Amended and Restated Loan and Security Agreement between Borrower
and the Banks dated May 2, 2008 (the “Agreement”), (i) Borrower is in complete
compliance for the period ending      with all covenants set forth in the
Agreement, except as noted below and (ii) all representations and warranties of
Borrower stated in the Agreement are true, correct and accurate as of the date
hereof. Attached herewith are the required documents supporting the above
certification. The undersigned authorized officer further certifies that this
Compliance Certificate and any supporting financial documents have been prepared
in accordance with Generally Accepted Accounting Principles (GAAP) and are
consistently applied from one period to the next except as explained in an
accompanying letter or footnotes – or unless otherwise permitted in the
Agreement. Reference is made to the Agreement for the relevant meanings of the
reporting requirements and covenants which are stated below in a “short-hand”
manner.

Please indicate compliance status by circling Yes/No under “Complies” column.

              Reporting Covenant   Required   Complies
Quarterly financial statements
  Quarterly within 30 days   Yes   No
Quarterly audits of Net Financed Balances
  Quarterly within 30 days   Yes   No
Annual financial statements (Audited)
  FYE within 120 days   Yes   No
10K and 10Q
  As applicable   Yes   No
Borrowing Base Cert. – Estimated
Remaining Collections
 
Monthly within 30 days  
Yes  
No

(Continued on Next Page)

7

Compliance Certificate
(Continued from Previous Page)

                          Financial Covenant   Required   Actual   Complies
Funded Debt to EBITDA
  Not more than 2.0 to 1.0

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

      to        
_   Yes

  No

Tangible Net Worth
  Equal to at least 100%
of Tangible Net Worth
reported by Borrower at
September 30, 2005,
plus 25% of cumulative
positive net income
accrued since the end
of such fiscal quarter,
plus 100% of the net
proceeds from any
equity offering,
calculated quarterly on
the last day of each
fiscal quarter, it
being understood that
up to $100,000,000
worth of funds expended
by Borrower on the
repurchase of
Borrower’s capital
stock shall not be
deducted from Tangible
Net Worth for purposes
of this covenant.  

 

 

  Yes

  No

 
     
 
 
 
 

(Continued on Next Page)

8

Compliance Certificate

(Continued from Previous Page)

             
Comments Regarding Exceptions: See Attached.
  BANK USE ONLY  
 

 
  Received by:  
 

 
  Authorized Signer  
 

 
  Date:  
 

Authorized Signatory of Borrower
 
 
 

 
  Verified:  
 

 
  Authorized Signer  
 

Title
 
 
 

 
  Date:  
 

Date
 
 
 

 
  Compliance Status   Yes   No

9

EXHIBIT F

Form of Asset Pool Report

10

SCHEDULE OF EXCEPTIONS

Permitted Indebtedness

Indebtedness owed by Borrower or any Guarantor hereunder or to (i) Steelcase
Financial or De Lage Landen Financial Services on Capitalized Leases maturing
6/14/2008, 8/16/2008 and 1/16/2009 respectively, and (ii) USBANCORP on operating
Leases.

Permitted Investments

Investments (i) in the membership interests of each Guarantor and (ii) in
connection with any Permitted Acquisition.

Permitted Liens

Liens securing Permitted Indebtedness.

11

      Bank of America, N.A.    
Wachovia Bank, National Association
RBC Bank (USA)
SunTrust Bank
  INSURANCE CERTIFICATION
and
AGREEMENT

     
TO:
  BANK OF AMERICA, N.A., WACHOVIA BANK, NATIONAL ASSOCIATION, RBC
BANK (USA) and SUNTRUST BANK Date: May 2, 2008

From:
  PORTFOLIO RECOVERY ASSOCIATES, INC.

In consideration of a loan referenced above (“loan”), the undersigned, jointly
and severally if more than one, certifies to and agrees with Bank of America,
Wachovia Bank, RBC Bank (USA), and SunTrust Bank (the “Banks”) as follows:

(a) the insurance coverage required in connection with the loan is in place and
will remain in force during the term of the loan;

(b) the policies of insurance evidencing the insurance coverage referenced in
(a) above are listed below, which information is accurate in all material
respects as of the date of this certification;

(c) we have notified the agent and companies identified below to add “Bank of
America, N.A., Wachovia Bank, National Association, RBC Bank (USA), SunTrust
Bank and their successors and assigns” as equal lender’s loss payees/mortgagees,
as directed by the Banks, on the existing insurance policies and to add “Bank of
America, N.A., Wachovia Bank, National Association, RBC Bank (USA) and SunTrust
Bank and their successors and assigns” as equal lender’s loss payees/mortgagees
on any new policies;

(d) we have notified the agents and companies identified below to furnish the
Banks at the above addresses with copies of the policies with all endorsements,
together with any subsequent renewal policies – all of which shall reflect the
interests of the Banks as required herein or as may otherwise be directed by the
Banks; and

(e) we have notified the agents and companies identified below to provide copies
of all notices given under the insurance policies to the Banks, including copies
of all notices regarding non-payment of premiums and termination or cancellation
of the policies, or any of them.

The following is identifying information on the policies of insurance required
to be carried by us under the loan:

(Continued on Next Page)

12

                         
Casualty Insurance
  Name: Hartford Casualty   Name:        
 
  Address: 8711 University East   Address:        
 
  Dr.                
 
  Charlotte, NC 28213                
 
  Telephone: 800-448-5462   Telephone:        
General Liability
  Name: Hartford Casualty   Name:        
 
  Address: 8711 University East   Address:        
 
  Dr.                
 
  Charlotte, NC 28213                
 
  Telephone:800-448-5462   Telephone:        
Workmen’s Comp.
  Name: PMA Insurance Co.   Name:        
 
  Address: P.O. Box 3031   Address:        
 
  380 Sentry Parkway                
 
  BWE BEU, PA 19422-0754                
 
  Telephone:610-397-5000   Telephone:        
 
                  Name: AWAC
 
                  Address: 225
 
                  Franklin Street
 
                  Boston, MA
Officers’ &
                    —  
Directors’
  Name:XL Insurance   Name: Zurich North ________   Telephone:
 
                       
 
  Address: 17th Floor   Address:21st Floor        
 
  100 Constitution Plaza   1818 Market Street        
 
  Hartford, CT 06103   Philadelphia, PA 19103        
 
  Telephone:   Telephone:        
Flood Insurance
  Name: Hartford   Name: Travelers        
 
  Address: P.O. Box 2057   Address: P.O. Box 34272        
 
  Kalispell, MT 59903-2057   Bethesda, MD 20827        
 
  Telephone:800-759-8656   Telephone: 800-356-6670        
Umbrella Policy
  Name: Hartford Casualty   Name: St. Paul Travelers        
 
  Address: Hartford Plaza   Address: 111 Schilling Road        
 
  Hartford, CT 06115   Hunt Valley, MD 21031        
 
  Telephone:   Telephone:        

(Signatures on Next Page)

13

 
Portfolio Recovery Associates, Inc.
By:      /s/ Steven D. Fredrickson     
Steven D. Fredrickson
President and Chief Executive Officer

14

      Bank of America, N.A.     Wachovia Bank, National Association    
RBC Bank (USA)
SunTrust Bank
  AUTOMATIC DEBIT
AUTHORIZATION

         
To: Bank of America, N.A.
Wachovia Bank, National Association
RBC Bank (USA)
SunTrust Bank

     
You are hereby authorized and instructed to charge,
America account No.      and Wacho
      in the name of
     , RBC B
  respectively, Bank of
via Bank account No.

ank (USA) account No. _____________________ , and SunTrust Bank account No.
_____________________ for

principal, interest, fees, charges and other paymen
above-referenced loan (“loan”) as set forth below a
  ts due on the
nd credit the loan.
     Debit each interest pa
according to the terms of
agreements evidencing the
renewed, extended, amended
substituted from time to t
  yment as it becomes due
the instruments and other
loan, as the same may be
        , modified, replaced and
ime.
     Debit each principal p
according to the terms of
agreements evidencing the
renewed, extended, amended
substituted from time to t
  ayment as it becomes due
the instruments and other
loan, as the same may be
        , modified, replaced and
ime.
     Debit any fees, charge
become due according to th
and other agreements evide
may be renewed, extended,
and substituted from time
  s and other payment as they
e terms of the instruments
ncing the loan, as the same
amended, modified, replaced
to time.
This Authorization is to remain in full force and e
writing by an authorized representative of Borrower
Bank. A revocation shall be deemed delivered to a
p.m. on the calendar day which is 30 business days
revocation is deposited in the U.S. mail, postage p
Bank at such address as the Bank may designate from
  ffect until revoked in
which is delivered to each
Bank effective as of 5:00
following the date the
repaid, addressed to the
time to time.

     
Portfolio Recovery Associates, Inc.
By:     /s/ Steven D. Fredrickson     
Steven D. Fredrickson
President and Chief Executive Officer
 

Date: May 2, 2008

15

      Bank of America, N.A.     Wachovia Bank, National Association     RBC Bank
(USA)    
SunTrust Bank
  SIGNATURE AUTHORIZATION

To: Bank of America, N.A. Wachovia Bank, National Association            RBC
Bank (USA) SunTrust Bank

Address: One Commercial Place Address: 101 West Main Street Address: 555 E. Main
St. Address: 150 W. Main St.

         
Commercial Banking, 3rd Floor
  Mail Code VA 5263   Suite 1000 Suite 1200 Norfolk, VA 23510   Norfolk, VA
23510 Norfolk, VA 23510 Norfolk, VA 23510
Attn: Paula H. Smith
  Attn: Charnette Simmons,   Attn: Denise M. Howard, Attn: Joel Rhew

Senior Vice President            Vice President            Senior Vice President

This Authorization is in reference to that certain Loan and Security Agreement
(“Agreement”) executed by the undersigned borrower (“Borrower”) concerning a
loan or loans from Bank of America         ,Wachovia Bank and RBC Bank (USA),
and SunTrust Bank (each a “Bank” and collectively the “Banks”) to Borrower. Each
individual signing on behalf of the Borrower, as shown below, hereby certifies
that he/she has been authorized by Borrower to designate certain individuals who
are employees or agents of Borrower to perform such acts as are contemplated by
and in furtherance of the Agreement.

The individuals named on the next page, and any one acting alone, are hereby
authorized and appointed for and on behalf of Borrower from time to time to do
any of the following:

  (1)   To request advances of credit under the Agreement and to effect
repayment of any credit outstanding under the Agreement.

  (2)   To execute and deliver assignments, borrowing certificates, instruments,
schedules, reports, invoices, bills, shipping documents and such other documents
and certificates as may be necessary or appropriate under the Agreement and any
instruments and other agreements relating thereto, including all those executed
and delivered in connection therewith;

  (3)   To transfer and endorse to each Bank, as applicable, in payment of
Borrower’s obligations to each Bank any of Borrower’s now existing and hereafter
acquired real and personal property, including, without limitation, any goods,
monies, accounts, general intangibles, investment property, documents, chattel
paper and any checks, drafts, notes and other instruments payable to Borrower;
and

  (4)   To do and perform any and all other acts and matters in any way relating
to any or all of the foregoing.

The undersigned individuals each further certifies that the specimen signatures
below are the genuine signatures of the individuals designated herein and that
their signatures shall be binding on Borrower until the Banks receive written
notice of termination of the authority of any such designated individuals.

     
Date: May 2, 2008
  Portfolio Recovery Associates, Inc.
By:     /s/ Steven D. Fredrickson     
Steven D. Fredrickson
President and Chief Executive Officer

Authorized Individuals and Specimen Signatures On Next Page

16

Attached to Signature Authorization
for
Portfolio Recovery Associates, Inc. to Bank of America, N.A. and Wachovia Bank,
National
Association,
RBC Bank (USA), and SunTrust Bank
dated May 2, 2008

Authorized Individuals and Specimen Signatures:

     
Name (Typed or Printed)
  Signature
Steven D. Fredrickson
  /s/ Steven D. Fredrickson
 
   
Kevin P. Stevenson
  /s/ Kevin P. Stevenson
Judith S. Scott
  /s/ Judith S. Scott

17

     

      Bank of America, N.A. Wachovia Bank, National Association RBC Bank (USA)  
 
SunTrust Bank
  Notice of Extension

To: PORTFOLIO RECOVERY ASSOCIATES, INC.

Address: 120 Corporate Boulevard

Suite 100

Norfolk, VA 23502

Attn:      

Facsimile:      

This Notice of Extension is in reference to that certain Third Amended and
Restated Loan and Security Agreement dated as of May 2, 2008 (“Agreement”)
executed by Portfolio Recovery Associates, Inc. (“Borrower”) concerning a loan
or loans from Bank of America, Wachovia Bank, RBC Bank (USA), and SunTrust Bank
(each a “Bank” and collectively with any additional lenders thereunder, the
“Banks”), to Borrower.

Pursuant to Section 2.7 of the Agreement, you are hereby notified that the
Revolver Maturity Date of the Agreement (as defined therein) is hereby extended
to a date that is one year from the current Revolver Maturity Date. For
avoidance of doubt, the Revolver Maturity Date is hereby extended to May 4,
200_.

The provisions of the Agreement shall continue in full force and effect and
shall not be modified or amended in any manner except as expressly provided
above.

BANK OF AMERICA, N.A. WACHOVIA BANK, NATIONAL ASSOCIATION

By:      By:      

     
Name:
  Name:
Title:
  Title:
Date:      
  Date:      
RBC BANK (USA)
  SUNTRUST BANK

By:      By:      

     
Name:
  Names:
Title:
  Title:
Date:      
  Date:      

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