(Multicurrency — Cross Border)

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MASTER AGREEMENT

dated as of July 15, 2003

Hub International Limited and Bank of Montreal

have entered and/or anticipate entering into one or more transactions (each a
“Transaction”) that are or will be governed by this Master Agreement, which
includes the schedule (the “Schedule”), and the documents and other confirming
evidence (each a “Confirmation”) exchanged between the parties confirming those
Transactions.

Accordingly, the parties agree as follows: —

 

1. Interpretation

(a)   Definitions. The terms defined in Section 14 and in the Schedule will have
the meanings therein specified for the purpose of this Master Agreement.   (b) 
Inconsistency. In the event of any inconsistency between the provisions of the
Schedule and the other provisions of this Master Agreement, the Schedule will
prevail. In the event of any inconsistency between the provisions of any
Confirmation and this Master Agreement (including the Schedule), such
Confirmation will prevail for the purpose of the relevant Transaction.   (c)  
Single Agreement. All Transactions are entered into in reliance on the fact that
this Master Agreement and all Confirmations form a single agreement between the
parties (collectively referred to as this “Agreement”), and the parties would
not otherwise enter into any Transactions.

 

2. Obligations

(a)  General Conditions.

  (i) Each party will make each payment or delivery specified in each
Confirmation to be made by it, subject to the other provisions of this
Agreement.     (ii) Payments under this Agreement will be made on the due date
for value on that date in the place of the account specified in the relevant
Confirmation or otherwise pursuant to this Agreement, in freely transferable
funds and in the manner customary for payments in the required currency. Where
settlement is by delivery (that is, other than by payment), such delivery will
be made for receipt on the due date in the manner customary for the relevant
obligation unless otherwise specified in the relevant Confirmation or elsewhere
in this Agreement.     (iii) Each obligation of each party under Section 2(a)(i)
is subject to (1) the condition precedent that no Event of Default or Potential
Event of Default with respect to the other party has occurred and is continuing,
(2) the condition precedent that no Early Termination Date in respect of the
relevant Transaction has occurred or been effectively designated and (3) each
other applicable condition precedent specified in this Agreement.

 

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(b)  Change of Account. Either party may change its account for receiving a
payment or delivery by giving notice to the other party at least five Local
Business Days prior to the scheduled date for the payment or delivery to which
such change applies unless such other party gives timely notice of a reasonable
objection to such change.   (c)   Netting. If on any date amounts would
otherwise be payable: —

  (i) in the same currency; and     (ii) in respect of the same Transaction,

by each party to the other, then, on such date, each party’s obligation to make
payment of any such amount will be automatically satisfied and discharged and,
if the aggregate amount that would otherwise have been payable by one party
exceeds the aggregate amount that would otherwise have been payable by the other
party, replaced by an obligation upon the party by whom the larger aggregate
amount would have been payable to pay to the other party the excess of the
larger aggregate amount over the smaller aggregate amount.

The parties may elect in respect of two or more Transactions that a net amount
will be determined in respect of all amounts payable on the same date in the
same currency in respect of such Transactions, regardless of whether such
amounts are payable in respect of the same Transaction. The election may be made
in the Schedule or a Confirmation by specifying that subparagraph (ii) above
will not apply to the Transactions identified as being subject to the election,
together with the starting date (in which case subparagraph (ii) above will not,
or will cease to, apply to such Transactions from such date). This election may
be made separately for different groups of Transactions and will apply
separately to each pairing of Offices through which the parties make and receive
payments or deliveries.

(d)  Deduction or Withholding for Tax.

  (i)   Gross-Up. All payments under this Agreement will be made without any
deduction or withholding for or on account of any Tax unless such deduction or
withholding is required by any applicable law, as modified by the practice of
any relevant governmental revenue authority, then in effect. If a party is so
required to deduct or withhold, then that party (“X”) will: —

  (1) promptly notify the other party (“Y”) of such requirement;     (2) pay to
the relevant authorities the full amount required to be deducted or withheld
(including the full amount required to be deducted or withheld from any
additional amount paid by X to Y under this Section 2(d)) promptly upon the
earlier of determining that such deduction or withholding is required or
receiving notice that such amount has been assessed against Y;     (3) promptly
forward to Y an official receipt (or a certified copy), or other documentation
reasonably acceptable to Y, evidencing such payment to such authorities; and    
(4) if such Tax is an Indemnifiable Tax, pay to Y, in addition to the payment to
which Y is otherwise entitled under this Agreement, such additional amount as is
necessary to ensure that the net amount actually received by Y (free and clear
of Indemnifiable Taxes, whether assessed against X or Y) will equal the full
amount Y would have received had no such deduction or withholding been required.
However, X will not be required to pay any additional amount to Y to the extent
that it would not be required to be paid but for: —

  (A) the failure by Y to comply with or perform any agreement contained in
Section 4(a)(i), 4(a)(iii) or 4(d); or     (B) the failure of a representation
made by Y pursuant to Section 3(f) to be accurate and true unless such failure
would not have occurred but for (I) any action taken by a taxing authority, or
brought in a court of competent jurisdiction, on or after the date on which a
Transaction is entered into (regardless of whether such action is taken or
brought with respect to a party to this Agreement) or (II) a Change in Tax Law.

 
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     (ii)  Liability. If: —

  (1) X is required by any applicable law, as modified by the practice of any
relevant governmental revenue authority, to make any deduction or withholding in
respect of which X would not be required to pay an additional amount to Y under
Section 2(d)(i)(4);     (2) X does not so deduct or withhold; and     (3) a
liability resulting from such Tax is assessed directly against X,

  then, except to the extent Y has satisfied or then satisfies the liability
resulting from such Tax, Y will promptly pay to X the amount of such liability
(including any related liability for interest, but including any related
liability for penalties only if Y has failed to comply with or perform any
agreement contained in Section 4(a)(i), 4(a)(iii) or 4(d)).

(e) Default Interest; Other Amounts. Prior to the occurrence or effective
designation of an Early Termination Date in respect of the relevant Transaction,
a party that defaults in the performance of any payment obligation will, to the
extent permitted by law and subject to Section 6(c), be required to pay interest
(before as well as after judgment) on the overdue amount to the other party on
demand in the same currency as such overdue amount, for the period from (and
including) the original due date for payment to (but excluding) the date of
actual payment, at the Default Rate. Such interest will be calculated on the
basis of daily compounding and the actual number of days elapsed. If, prior to
the occurrence or effective designation of an Early Termination Date in respect
of the relevant Transaction, a party defaults in the performance of any
obligation required to be settled by delivery, it will compensate the other
party on demand if and to the extent provided for in the relevant Confirmation
or elsewhere in this Agreement.

 

3. Representations

Each party represents to the other party (which representations will be deemed
to be repeated by each party on each date on which a Transaction is entered into
and, in the case of the representations in Section 3(f), at all times until the
termination of this Agreement) that: —

(a)  Basic Representations.

  (i) Status. It is duly organised and validly existing under the laws of the
jurisdiction of its organisation or incorporation and, if relevant under such
laws, in good standing;     (ii) Powers. It has the power to execute this
Agreement and any other documentation relating to this Agreement to which it is
a party, to deliver this Agreement and any other documentation relating to this
Agreement that it is required by this Agreement to deliver and to perform its
obligations under this Agreement and any obligations it has under any Credit
Support Document to which it is a party and has taken all necessary action to
authorise such execution, delivery and performance;     (iii) No Violation or
Conflict. Such execution, delivery and performance do not violate or conflict
with any law applicable to it, any provision of its constitutional documents,
any order or judgment of any court or other agency of government applicable to
it or any of its assets or any contractual restriction binding on or affecting
it or any of its assets;     (iv) Consents. All governmental and other consents
that are required to have been obtained by it with respect to this Agreement or
any Credit Support Document to which it is a party have been obtained and are in
full force and effect and all conditions of any such consents have been complied
with; and     (v) Obligations Binding. Its obligations under this Agreement and
any Credit Support Document to which it is a party constitute its legal, valid
and binding obligations, enforceable in accordance with their respective terms
(subject to applicable bankruptcy, reorganisation, insolvency, moratorium or
similar laws affecting creditors’ rights generally and subject, as to
enforceability, to equitable principles of general application (regardless of
whether enforcement is sought in a proceeding in equity or at law)).

 
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  (b) Absence of Certain Events. No Event of Default or Potential Event of
Default or, to its knowledge, Termination Event with respect to it has occurred
and is continuing and no such event or circumstance would occur as a result of
its entering into or performing its obligations under this Agreement or any
Credit Support Document to which it is a party.     (c) Absence of Litigation.
There is not pending or, to its knowledge, threatened against it or any of its
Affiliates any action, suit or proceeding at law or in equity or before any
court, tribunal, governmental body, agency or official or any arbitrator that is
likely to affect the legality, validity or enforceability against it of this
Agreement or any Credit Support Document to which it is a party or its ability
to perform its obligations under this Agreement or such Credit Support Document.
    (d) Accuracy of Specified Information. All applicable information that is
furnished in writing by or on behalf of it to the other party and is identified
for the purpose of this Section 3(d) in the Schedule is, as of the date of the
information, true, accurate and complete in every material respect.     (e)
Payer Tax Representation. Each representation specified in the Schedule as being
made by it for the purpose of this Section 3(e) is accurate and true.     (f)
Payee Tax Representations. Each representation specified in the Schedule as
being made by it for the purpose of this Section 3(f) is accurate and true.

4.  Agreements

Each party agrees with the other that, so long as either party has or may have
any obligation under this Agreement or under any Credit Support Document to
which it is a party: —

  (a) Furnish Specified Information. It will deliver to the other party or, in
certain cases under subparagraph (iii) below, to such government or taxing
authority as the other party reasonably directs: —

  (i) any forms, documents or certificates relating to taxation specified in the
Schedule or any Confirmation;     (ii) any other documents specified in the
Schedule or any Confirmation; and     (iii) upon reasonable demand by such other
party, any form or document that may be required or reasonably requested in
writing in order to allow such other party or its Credit Support Provider to
make a payment under this Agreement or any applicable Credit Support Document
without any deduction or withholding for or on account of any Tax or with such
deduction or withholding at a reduced rate (so long as the completion, execution
or submission of such form or document would not materially prejudice the legal
or commercial position of the party in receipt of such demand), with any such
form or document to be accurate and completed in a manner reasonably
satisfactory to such other party and to be executed and to be delivered with any
reasonably required certification,

  in each case by the date specified in the Schedule or such Confirmation or, if
none is specified, as soon as reasonably practicable.

  (b) Maintain Authorisations. It will use all reasonable efforts to maintain in
full force and effect all consents of any governmental or other authority that
are required to be obtained by it with respect to this Agreement or any Credit
Support Document to which it is a party and will use all reasonable efforts to
obtain any that may become necessary in the future.     (c) Comply with Laws. It
will comply in all material respects with all applicable laws and orders to
which it may be subject if failure so to comply would materially impair its
ability to perform its obligations under this Agreement or any Credit Support
Document to which it is a party.     (d) Tax Agreement. It will give notice of
any failure of a representation made by it under Section 3(f) to be accurate and
true promptly upon learning of such failure.

 
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  (e) Payment of Stamp Tax. Subject to Section 11, it will pay any Stamp Tax
levied or imposed upon it or in respect of its execution or performance of this
Agreement by a jurisdiction in which it is incorporated, organised, managed and
controlled, or considered to have its seat, or in which a branch or office
through which it is acting for the purpose of this Agreement is located (“Stamp
Tax Jurisdiction”) and will indemnify the other party against any Stamp Tax
levied or imposed upon the other party or in respect of the other party’s
execution or performance of this Agreement by any such Stamp Tax Jurisdiction
which is not also a Stamp Tax Jurisdiction with respect to the other party.

 

5. Events of Default and Termination Events

(a) Events of Default. The occurrence at any time with respect to a party or, if
applicable, any Credit Support Provider of such party or any Specified Entity of
such party of any of the following events constitutes an event of default (an
“Event of Default”) with respect to such party: —

  (i) Failure to Pay or Deliver. Failure by the party to make, when due, any
payment under this Agreement or delivery under Section 2(a)(i) or 2(e) required
to be made by it if such failure is not remedied on or before the third Local
Business Day after notice of such failure is given to the party;     (ii) Breach
of Agreement. Failure by the party to comply with or perform any agreement or
obligation (other than an obligation to make any payment under this Agreement or
delivery under Section 2(a)(i) or 2(e) or to give notice of a Termination Event
or any agreement or obligation under Section 4(a)(i), 4(a)(iii) or 4(d)) to be
complied with or performed by the party in accordance with this Agreement if
such failure is not remedied on or before the thirtieth day after notice of such
failure is given to the party;     (iii) Credit Support Default.

  (1) Failure by the party or any Credit Support Provider of such party to
comply with or perform any agreement or obligation to be complied with or
performed by it in accordance with any Credit Support Document if such failure
is continuing after any applicable grace period has elapsed;     (2) the
expiration or termination of such Credit Support Document or the failing or
ceasing of such Credit Support Document to be in full force and effect for the
purpose of this Agreement (in either case other than in accordance with its
terms) prior to the satisfaction of all obligations of such party under each
Transaction to which such Credit Support Document relates without the written
consent of the other party; or     (3) the party or such Credit Support Provider
disaffirms, disclaims, repudiates or rejects, in whole or in part, or challenges
the validity of, such Credit Support Document;

  (iv) Misrepresentation. A representation (other than a representation under
Section 3(e) or (f)) made or repeated or deemed to have been made or repeated by
the party or any Credit Support Provider of such party in this Agreement or any
Credit Support Document proves to have been incorrect or misleading in any
material respect when made or repeated or deemed to have been made or repeated;
    (v) Default under Specified Transaction. The party, any Credit Support
Provider of such party or any applicable Specified Entity of such party
(1) defaults under a Specified Transaction and, after giving effect to any
applicable notice requirement or grace period, there occurs a liquidation of, an
acceleration of obligations under, or an early termination of, that Specified
Transaction, (2) defaults, after giving effect to any applicable notice
requirement or grace period, in making any payment or delivery due on the last
payment, delivery or exchange date of, or any payment on early termination of, a
Specified Transaction (or such default continues for at least three Local
Business Days if there is no applicable notice requirement or grace period) or
(3) disaffirms, disclaims, repudiates or rejects, in whole or in part, a
Specified Transaction (or such action is taken by any person or entity appointed
or empowered to operate it or act on its behalf);     (vi) Cross Default. If
“Cross Default” is specified in the Schedule as applying to the party, the
occurrence or existence of (1) a default, event of default or other similar
condition or event (however described) in

 
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  respect of such party, any Credit Support Provider of such party or any
applicable Specified Entity of such party under one or more agreements or
instruments relating to Specified Indebtedness of any of them (individually or
collectively) in an aggregate amount of not less than the applicable Threshold
Amount (as specified in the Schedule) which has resulted in such Specified
Indebtedness becoming, or becoming capable at such time of being declared, due
and payable under such agreements or instruments, before it would otherwise have
been due and payable or (2) a default by such party, such Credit Support
Provider or such Specified Entity (individually or collectively) in making one
or more payments on the due date thereof in an aggregate amount of not less than
the applicable Threshold Amount under such agreements or instruments (after
giving effect to any applicable notice requirement or grace period);     (vii) 
Bankruptcy. The party, any Credit Support Provider of such party or any
applicable Specified Entity of such party: —

  (1) is dissolved (other than pursuant to a consolidation, amalgamation or
merger); (2) becomes insolvent or is unable to pay its debts or fails or admits
in writing its inability generally to pay its debts as they become due;
(3) makes a general assignment, arrangement or composition with or for the
benefit of its creditors; (4) institutes or has instituted against it a
proceeding seeking a judgment of insolvency or bankruptcy or any other relief
under any bankruptcy or insolvency law or other similar law affecting creditors’
rights, or a petition is presented for its winding-up or liquidation, and, in
the case of any such proceeding or petition instituted or presented against it,
such proceeding or petition (A) results in a judgment of insolvency or
bankruptcy or the entry of an order for relief or the making of an order for its
winding-up or liquidation or (B) is not dismissed, discharged, stayed or
restrained in each case within 30 days of the institution or presentation
thereof; (5) has a resolution passed for its winding-up, official management or
liquidation (other than pursuant to a consolidation, amalgamation or merger);
(6) seeks or becomes subject to the appointment of an administrator, provisional
liquidator, conservator, receiver, trustee, custodian or other similar official
for it or for all or substantially all its assets; (7) has a secured party take
possession of all or substantially all its assets or has a distress, execution,
attachment, sequestration or other legal process levied, enforced or sued on or
against all or substantially all its assets and such secured party maintains
possession, or any such process is not dismissed, discharged, stayed or
restrained, in each case within 30 days thereafter; (8) causes or is subject to
any event with respect to it which, under the applicable laws of any
jurisdiction, has an analogous effect to any of the events specified in
clauses (1) to (7) (inclusive); or (9) takes any action in furtherance of, or
indicating its consent to, approval of, or acquiescence in, any of the foregoing
acts; or

  (viii)  Merger Without Assumption. The party or any Credit Support Provider of
such party consolidates or amalgamates with, or merges with or into, or
transfers all or substantially all its assets to, another entity and, at the
time of such consolidation, amalgamation, merger or transfer: —

  (1) the resulting, surviving or transferee entity fails to assume all the
obligations of such party or such Credit Support Provider under this Agreement
or any Credit Support Document to which it or its predecessor was a party by
operation of law or pursuant to an agreement reasonably satisfactory to the
other party to this Agreement; or     (2) the benefits of any Credit Support
Document fail to extend (without the consent of the other party) to the
performance by such resulting, surviving or transferee entity of its obligations
under this Agreement.

(b) Termination Events. The occurrence at any time with respect to a party or,
if applicable, any Credit Support Provider of such party or any Specified Entity
of such party of any event specified below constitutes an Illegality if the
event is specified in (i) below, a Tax Event if the event is specified in
(ii) below or a Tax Event Upon Merger if the event is specified in (iii) below,
and, if specified to be applicable, a Credit Event Upon Merger if the event is
specified pursuant to (iv) below or an Additional Termination Event if the event
is specified pursuant to (v) below: —

 
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  (i) Illegality. Due to the adoption of, or any change in, any applicable law
after the date on which a Transaction is entered into, or due to the
promulgation of, or any change in, the interpretation by any court, tribunal or
regulatory authority with competent jurisdiction of any applicable law after
such date, it becomes unlawful (other than as a result of a breach by the party
of Section 4(b)) for such party (which will be the Affected Party): —

  (1) to perform any absolute or contingent obligation to make a payment or
delivery or to receive a payment or delivery in respect of such Transaction or
to comply with any other material provision of this Agreement relating to such
Transaction; or     (2) to perform, or for any Credit Support Provider of such
party to perform, any contingent or other obligation which the party (or such
Credit Support Provider) has under any Credit Support Document relating to such
Transaction;

  (ii) Tax Event. Due to (x) any action taken by a taxing authority, or brought
in a court of competent jurisdiction, on or after the date on which a
Transaction is entered into (regardless of whether such action is taken or
brought with respect to a party to this Agreement) or (y) a Change in Tax Law,
the party (which will be the Affected Party) will, or there is a substantial
likelihood that it will, on the next succeeding Scheduled Payment Date (1) be
required to pay to the other party an additional amount in respect of an
Indemnifiable Tax under Section 2(d)(i)(4) (except in respect of interest under
Section 2(e), 6(d)(ii) or 6(e)) or (2) receive a payment from which an amount is
required to be deducted or withheld for or on account of a Tax (except in
respect of interest under Section 2(e), 6(d)(ii) or 6(e)) and no additional
amount is required to be paid in respect of such Tax under Section 2(d)(i)(4)
(other than by reason of Section 2(d)(i)(4)(A) or (B));     (iii) Tax Event Upon
Merger. The party (the “Burdened Party”) on the next succeeding Scheduled
Payment Date will either (1) be required to pay an additional amount in respect
of an Indemnifiable Tax under Section 2(d)(i)(4) (except in respect of interest
under Section 2(e), 6(d)(ii) or 6(e)) or (2) receive a payment from which an
amount has been deducted or withheld for or on account of any Indemnifiable Tax
in respect of which the other party is not required to pay an additional amount
(other than by reason of Section 2(d)(i)(4)(A) or (B)), in either case as a
result of a party consolidating or amalgamating with, or merging with or into,
or transferring all or substantially all its assets to, another entity (which
will be the Affected Party) where such action does not constitute an event
described in Section 5(a)(viii);     (iv) Credit Event Upon Merger. If “Credit
Event Upon Merger” is specified in the Schedule as applying to the party, such
party (“X”), any Credit Support Provider of X or any applicable Specified Entity
of X consolidates or amalgamates with, or merges with or into, or transfers all
or substantially all its assets to, another entity and such action does not
constitute an event described in Section 5(a)(viii) but the creditworthiness of
the resulting, surviving or transferee entity is materially weaker than that of
X, such Credit Support Provider or such Specified Entity, as the case may be,
immediately prior to such action (and, in such event, X or its successor or
transferee, as appropriate, will be the Affected Party); or     (v) Additional
Termination Event. If any “Additional Termination Event” is specified in the
Schedule or any Confirmation as applying, the occurrence of such event (and, in
such event, the Affected Party or Affected Parties shall be as specified for
such Additional Termination Event in the Schedule or such Confirmation).

(c) Event of Default and Illegality. If an event or circumstance which would
otherwise constitute or give rise to an Event of Default also constitutes an
Illegality, it will be treated as an Illegality and will not constitute an Event
of Default.

 

6. Early Termination

(a) Right to Terminate Following Event of Default. If at any time an Event of
Default with respect to a party (the “Defaulting Party”) has occurred and is
then continuing, the other party (the “Non-defaulting Party”) may, by not more
than 20 days notice to the Defaulting Party specifying the relevant Event of
Default, designate a

 
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day not earlier than the day such notice is effective as an Early Termination
Date in respect of all outstanding Transactions. If, however, “Automatic Early
Termination” is specified in the Schedule as applying to a party, then an Early
Termination Date in respect of all outstanding Transactions will occur
immediately upon the occurrence with respect to such party of an Event of
Default specified in Section 5(a)(vii)(1), (3), (5), (6) or, to the extent
analogous thereto, (8), and as of the time immediately preceding the institution
of the relevant proceeding or the presentation of the relevant petition upon the
occurrence with respect to such party of an Event of Default specified in
Section 5(a)(vii)(4) or, to the extent analogous thereto, (8).   (b) Right to
Terminate Following Termination Event.

  (i) Notice. If a Termination Event occurs, an Affected Party will, promptly
upon becoming aware of it, notify the other party, specifying the nature of that
Termination Event and each Affected Transaction and will also give such other
information about that Termination Event as the other party may reasonably
require.     (ii) Transfer to Avoid Termination Event. If either an Illegality
under Section 5(b)(i)(1) or a Tax Event occurs and there is only one Affected
Party, or if a Tax Event Upon Merger occurs and the Burdened Party is the
Affected Party, the Affected Party will, as a condition to its right to
designate an Early Termination Date under Section 6(b)(iv), use all reasonable
efforts (which will not require such party to incur a loss, excluding
immaterial, incidental expenses) to transfer within 20 days after it gives
notice under Section 6(b)(i) all its rights and obligations under this Agreement
in respect of the Affected Transactions to another of its Offices or Affiliates
so that such Termination Event ceases to exist.

  If the Affected Party is not able to make such a transfer it will give notice
to the other party to that effect within such 20 day period, whereupon the other
party may effect such a transfer within 30 days after the notice is given under
Section 6(b)(i).     Any such transfer by a party under this Section 6(b)(ii)
will be subject to and conditional upon the prior written consent of the other
party, which consent will not be withheld if such other party’s policies in
effect at such time would permit it to enter into transactions with the
transferee on the terms proposed.

  (iii) Two Affected Parties. If an Illegality under Section 5(b)(i)(1) or a Tax
Event occurs and there are two Affected Parties, each party will use all
reasonable efforts to reach agreement within 30 days after notice thereof is
given under Section 6(b)(i) on action to avoid that Termination Event.     (iv)
Right to Terminate. If: —

  (1) a transfer under Section 6(b)(ii) or an agreement under Section 6(b)(iii),
as the case may be, has not been effected with respect to all Affected
Transactions within 30 days after an Affected Party gives notice under
Section 6(b)(i); or     (2) an Illegality under Section 5(b)(i)(2), a Credit
Event Upon Merger or an Additional Termination Event occurs, or a Tax Event Upon
Merger occurs and the Burdened Party is not the Affected Party,

  either party in the case of an Illegality, the Burdened Party in the case of a
Tax Event Upon Merger, any Affected Party in the case of a Tax Event or an
Additional Termination Event if there is more than one Affected Party, or the
party which is not the Affected Party in the case of a Credit Event Upon Merger
or an Additional Termination Event if there is only one Affected Party may, by
not more than 20 days notice to the other party and provided that the relevant
Termination Event is then continuing, designate a day not earlier than the day
such notice is effective as an Early Termination Date in respect of all Affected
Transactions.

(c) Effect of Designation.

  (i) If notice designating an Early Termination Date is given under
Section 6(a) or (b), the Early Termination Date will occur on the date so
designated, whether or not the relevant Event of Default or Termination Event is
then continuing.

 
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  (ii) Upon the occurrence or effective designation of an Early Termination
Date, no further payments or deliveries under Section 2(a)(i) or 2(e) in respect
of the Terminated Transactions will be required to be made, but without
prejudice to the other provisions of this Agreement. The amount, if any, payable
in respect of an Early Termination Date shall be determined pursuant to
Section 6(e).

(d) Calculations.

  (i) Statement. On or as soon as reasonably practicable following the
occurrence of an Early Termination Date, each party will make the calculations
on its part, if any, contemplated by Section 6(e) and will provide to the other
party a statement (1) showing, in reasonable detail, such calculations
(including all relevant quotations and specifying any amount payable under
Section 6(e)) and (2) giving details of the relevant account to which any amount
payable to it is to be paid. In the absence of written confirmation from the
source of a quotation obtained in determining a Market Quotation, the records of
the party obtaining such quotation will be conclusive evidence of the existence
and accuracy of such quotation.     (ii) Payment Date. An amount calculated as
being due in respect of any Early Termination Date under Section 6(e) will be
payable on the day that notice of the amount payable is effective (in the case
of an Early Termination Date which is designated or occurs as a result of an
Event of Default) and on the day which is two Local Business Days after the day
on which notice of the amount payable is effective (in the case of an Early
Termination Date which is designated as a result of a Termination Event). Such
amount will be paid together with (to the extent permitted under applicable law)
interest thereon (before as well as after judgment) in the Termination Currency,
from (and including) the relevant Early Termination Date to (but excluding) the
date such amount is paid, at the Applicable Rate. Such interest will be
calculated on the basis of daily compounding and the actual number of days
elapsed.

(e) Payments on Early Termination. If an Early Termination Date occurs, the
following provisions shall apply based on the parties’ election in the Schedule
of a payment measure, either “Market Quotation” or “Loss”, and a payment method,
either the “First Method” or the “Second Method”. If the parties fail to
designate a payment measure or payment method in the Schedule, it will be deemed
that “Market Quotation” or the “Second Method”, as the case may be, shall apply.
The amount, if any, payable in respect of an Early Termination Date and
determined pursuant to this Section will be subject to any Set-off.

  (i) Events of Default. If the Early Termination Date results from an Event of
Default: —

  (1) First Method and Market Quotation. If the First Method and Market
Quotation apply, the Defaulting Party will pay to the Non-defaulting Party the
excess, if a positive number, of (A) the sum of the Settlement Amount
(determined by the Non-defaulting Party) in respect of the Terminated
Transactions and the Termination Currency Equivalent of the Unpaid Amounts owing
to the Non-defaulting Party over (B) the Termination Currency Equivalent of the
Unpaid Amounts owing to the Defaulting Party.     (2) First Method and Loss. If
the First Method and Loss apply, the Defaulting Party will pay to the
Non-defaulting Party, if a positive number, the Non-defaulting Party’s Loss in
respect of this Agreement.     (3) Second Method and Market Quotation. If the
Second Method and Market Quotation apply, an amount will be payable equal to (A)
the sum of the Settlement Amount (determined by the Non-defaulting Party) in
respect of the Terminated Transactions and the Termination Currency Equivalent
of the Unpaid Amounts owing to the Non-defaulting Party less (B) the Termination
Currency Equivalent of the Unpaid Amounts owing to the Defaulting Party. If that
amount is a positive number, the Defaulting Party will pay it to the
Non-defaulting Party; if it is a negative number, the Non-defaulting Party will
pay the absolute value of that amount to the Defaulting Party.     (4) Second
Method and Loss. If the Second Method and Loss apply, an amount will be payable
equal to the Non-defaulting Party’s Loss in respect of this Agreement. If that
amount is a positive number,

 
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  the Defaulting Party will pay it to the Non-defaulting Party; if it is a
negative number, the Non-defaulting Party will pay the absolute value of that
amount to the Defaulting Party.

  (ii) Termination Events. If the Early Termination Date results from a
Termination Event: —

  (1) One Affected Party. If there is one Affected Party, the amount payable
will be determined in accordance with Section 6(e)(i)(3), if Market Quotation
applies, or Section 6(e)(i)(4), if Loss applies, except that, in either case,
references to the Defaulting Party and to the Non-defaulting Party will be
deemed to be references to the Affected Party and the party which is not the
Affected Party, respectively, and, if Loss applies and fewer than all the
Transactions are being terminated, Loss shall be calculated in respect of all
Terminated Transactions.     (2) Two Affected Parties. If there are two Affected
Parties: —

  (A) if Market Quotation applies, each party will determine a Settlement Amount
in respect of the Terminated Transactions, and an amount will be payable equal
to (I) the sum of (a) one-half of the difference between the Settlement Amount
of the party with the higher Settlement Amount (“X”) and the Settlement Amount
of the party with the lower Settlement Amount (“Y”) and (b) the Termination
Currency Equivalent of the Unpaid Amounts owing to X less (II) the Termination
Currency Equivalent of the Unpaid Amounts owing to Y; and     (B) if Loss
applies, each party will determine its Loss in respect of this Agreement (or, if
fewer than all the Transactions are being terminated, in respect of all
Terminated Transactions) and an amount will be payable equal to one-half of the
difference between the Loss of the party with the higher Loss (“X”) and the Loss
of the party with the lower Loss (“Y”).

  If the amount payable is a positive number, Y will pay it to X; if it is a
negative number, X will pay the absolute value of that amount to Y.

  (iii) Adjustment for Bankruptcy. In circumstances where an Early Termination
Date occurs because “Automatic Early Termination” applies in respect of a party,
the amount determined under this Section 6(e) will be subject to such
adjustments as are appropriate and permitted by law to reflect any payments or
deliveries made by one party to the other under this Agreement (and retained by
such other party) during the period from the relevant Early Termination Date to
the date for payment determined under Section 6(d)(ii).     (iv) Pre-Estimate.
The parties agree that if Market Quotation applies an amount recoverable under
this Section 6(e) is a reasonable pre-estimate of loss and not a penalty. Such
amount is payable for the loss of bargain and the loss of protection against
future risks and except as otherwise provided in this Agreement neither party
will be entitled to recover any additional damages as a consequence of such
losses.

 

7. Transfer

Subject to Section 6(b)(ii), neither this Agreement nor any interest or
obligation in or under this Agreement may be transferred (whether by way of
security or otherwise) by either party without the prior written consent of the
other party, except that: —

  (a) a party may make such a transfer of this Agreement pursuant to a
consolidation or amalgamation with, or merger with or into, or transfer of all
or substantially all its assets to, another entity (but without prejudice to any
other right or remedy under this Agreement); and     (b) a party may make such a
transfer of all or any part of its interest in any amount payable to it from a
Defaulting Party under Section 6(e).

Any purported transfer that is not in compliance with this Section will be void.

 
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8.  Contractual Currency

(a) Payment in the Contractual Currency. Each payment under this Agreement will
be made in the relevant currency specified in this Agreement for that payment
(the “Contractual Currency”). To the extent permitted by applicable law, any
obligation to make payments under this Agreement in the Contractual Currency
will not be discharged or satisfied by any tender in any currency other than the
Contractual Currency, except to the extent such tender results in the actual
receipt by the party to which payment is owed, acting in a reasonable manner and
in good faith in converting the currency so tendered into the Contractual
Currency, of the full amount in the Contractual Currency of all amounts payable
in respect of this Agreement. If for any reason the amount in the Contractual
Currency so received falls short of the amount in the Contractual Currency
payable in respect of this Agreement, the party required to make the payment
will, to the extent permitted by applicable law, immediately pay such additional
amount in the Contractual Currency as may be necessary to compensate for the
shortfall. If for any reason the amount in the Contractual Currency so received
exceeds the amount in the Contractual Currency payable in respect of this
Agreement, the party receiving the payment will refund promptly the amount of
such excess.   (b) Judgments. To the extent permitted by applicable law, if any
judgment or order expressed in a currency other than the Contractual Currency is
rendered (i) for the payment of any amount owing in respect of this Agreement,
(ii) for the payment of any amount relating to any early termination in respect
of this Agreement or (iii) in respect of a judgment or order of another court
for the payment of any amount described in (i) or (ii) above, the party seeking
recovery, after recovery in full of the aggregate amount to which such party is
entitled pursuant to the judgment or order, will be entitled to receive
immediately from the other party the amount of any shortfall of the Contractual
Currency received by such party as a consequence of sums paid in such other
currency and will refund promptly to the other party any excess of the
Contractual Currency received by such party as a consequence of sums paid in
such other currency if such shortfall or such excess arises or results from any
variation between the rate of exchange at which the Contractual Currency is
converted into the currency of the judgment or order for the purposes of such
judgment or order and the rate of exchange at which such party is able, acting
in a reasonable manner and in good faith in converting the currency received
into the Contractual Currency, to purchase the Contractual Currency with the
amount of the currency of the judgment or order actually received by such party.
The term “rate of exchange” includes, without limitation, any premiums and costs
of exchange payable in connection with the purchase of or conversion into the
Contractual Currency.   (c) Separate Indemnities. To the extent permitted by
applicable law, these indemnities constitute separate and independent
obligations from the other obligations in this Agreement, will be enforceable as
separate and independent causes of action, will apply notwithstanding any
indulgence granted by the party to which any payment is owed and will not be
affected by judgment being obtained or claim or proof being made for any other
sums payable in respect of this Agreement.   (d) Evidence of Loss. For the
purpose of this Section 8, it will be sufficient for a party to demonstrate that
it would have suffered a loss had an actual exchange or purchase been made.

 

9. Miscellaneous

(a) Entire Agreement. This Agreement constitutes the entire agreement and
understanding of the parties with respect to its subject matter and supersedes
all oral communication and prior writings with respect thereto.   (b)
Amendments. No amendment, modification or waiver in respect of this Agreement
will be effective unless in writing (including a writing evidenced by a
facsimile transmission) and executed by each of the parties or confirmed by an
exchange of telexes or electronic messages on an electronic messaging system.  
(c) Survival of Obligations. Without prejudice to Sections 2(a)(iii) and
6(c)(ii), the obligations of the parties under this Agreement will survive the
termination of any Transaction.

 
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(d) Remedies Cumulative. Except as provided in this Agreement, the rights,
powers, remedies and privileges provided in this Agreement are cumulative and
not exclusive of any rights, powers, remedies and privileges provided by law.  
(e) Counterparts and Confirmations.

  (i) This Agreement (and each amendment, modification and waiver in respect of
it) may be executed and delivered in counterparts (including by facsimile
transmission), each of which will be deemed an original.     (ii) The parties
intend that they are legally bound by the terms of each Transaction from the
moment they agree to those terms (whether orally or otherwise). A Confirmation
shall he entered into as soon as practicable and may he executed and delivered
in counterparts (including by facsimile transmission) or be created by an
exchange of telexes or by an exchange of electronic messages on an electronic
messaging system, which in each case will be sufficient for all purposes to
evidence a binding supplement to this Agreement. The parties will specify
therein or through another effective means that any such counterpart, telex or
electronic message constitutes a Confirmation.

(f) No Waiver of Rights. A failure or delay in exercising any right, power or
privilege in respect of this Agreement will not be presumed to operate as a
waiver, and a single or partial exercise of any right, power or privilege will
not be presumed to preclude any subsequent or further exercise, of that right,
power or privilege or the exercise of any other right, power or privilege.   (g)
Headings. The headings used in this Agreement are for convenience of reference
only and are not to affect the construction of or to be taken into consideration
in interpreting this Agreement.

 

10. Offices; Multibranch Parties

(a) If Section 10(a) is specified in the Schedule as applying, each party that
enters into a Transaction through an Office other than its head or home office
represents to the other party that, notwithstanding the place of booking office
or jurisdiction of incorporation or organisation of such party, the obligations
of such party are the same as if it had entered into the Transaction through its
head or home office. This representation will be deemed to be repeated by such
party on each date on which a Transaction is entered into.   (b) Neither party
may change the Office through which it makes and receives payments or deliveries
for the purpose of a Transaction without the prior written consent of the other
party.   (c) If a party is specified as a Multibranch Party in the Schedule,
such Multibranch Party may make and receive payments or deliveries under any
Transaction through any Office listed in the Schedule, and the Office through
which it makes and receives payments or deliveries with respect to a Transaction
will be specified in the relevant Confirmation.

 

11. Expenses

A Defaulting Party will, on demand, indemnify and hold harmless the other party
for and against all reasonable out-of-pocket expenses, including legal fees and
Stamp Tax, incurred by such other party by reason of the enforcement and
protection of its rights under this Agreement or any Credit Support Document to
which the Defaulting Party is a party or by reason of the early termination of
any Transaction, including, but not limited to, costs of collection.

12. Notices

(a)   Effectiveness. Any notice or other communication in respect of this
Agreement may be given in any manner set forth below (except that a notice or
other communication under Section 5 or 6 may not be given by

 
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facsimile transmission or electronic messaging system) to the address or number
or in accordance with the electronic messaging system details provided (see the
Schedule) and will be deemed effective as indicated: —

  (i) if in writing and delivered in person or by courier, on the date it is
delivered;     (ii) if sent by telex, on the date the recipient’s answerback is
received;     (iii) if sent by facsimile transmission, on the date that
transmission is received by a responsible employee of the recipient in legible
form (it being agreed that the burden of proving receipt will be on the sender
and will not be met by a transmission report generated by the sender’s facsimile
machine);     (iv) if sent by certified or registered mail (airmail, if
overseas) or the equivalent (return receipt requested), on the date that mail is
delivered or its delivery is attempted; or     (v) if sent by electronic
messaging system, on the date that electronic message is received,

unless the date of that delivery (or attempted delivery) or that receipt, as
applicable, is not a Local Business Day or that communication is delivered (or
attempted) or received, as applicable, after the close of business on a Local
Business Day, in which case that communication shall be deemed given and
effective on the first following day that is a Local Business Day.

(b) Change of Addresses. Either party may by notice to the other change the
address, telex or facsimile number or electronic messaging system details at
which notices or other communications are to be given to it.

 

13. Governing Law and Jurisdiction

(a) Governing Law. This Agreement will be governed by and construed in
accordance with the law specified in the Schedule.   (b) Jurisdiction. With
respect to any suit, action or proceedings relating to this Agreement
(“Proceedings”), each party irrevocably: —

  (i) submits to the jurisdiction of the English courts, if this Agreement is
expressed to be governed by English law, or to the non- exclusive jurisdiction
of the courts of the State of New York and the United States District Court
located in the Borough of Manhattan in New York City, if this Agreement is
expressed to be governed by the laws of the State of New York; and     (ii)
waives any objection which it may have at any time to the laying of venue of any
Proceedings brought in any such court, waives any claim that such Proceedings
have been brought in an inconvenient forum and further waives the right to
object, with respect to such Proceedings, that such court does not have any
jurisdiction over such party.

Nothing in this Agreement precludes either party from bringing Proceedings in
any other jurisdiction (outside, if this Agreement is expressed to be governed
by English law, the Contracting States, as defined in Section 1(3) of the Civil
Jurisdiction and Judgments Act 1982 or any modification, extension or
re-enactment thereof for the time being in force) nor will the bringing of
Proceedings in any one or more jurisdictions preclude the bringing of
Proceedings in any other jurisdiction.

(c) Service of Process. Each party irrevocably appoints the Process Agent (if
any) specified opposite its name in the Schedule to receive, for it and on its
behalf, service of process in any Proceedings. If for any reason any party’s
Process Agent is unable to act as such, such party will promptly notify the
other party and within 30 days appoint a substitute process agent acceptable to
the other party. The parties irrevocably consent to service of process given in
the manner provided for notices in Section 12. Nothing in this Agreement will
affect the right of either party to serve process in any other manner permitted
by law.   (d) Waiver of Immunities. Each party irrevocably waives, to the
fullest extent permitted by applicable law, with respect to itself and its
revenues and assets (irrespective of their use or intended use), all immunity on
the grounds of sovereignty or other similar grounds from (i) suit,
(ii) jurisdiction of any court, (iii) relief by way of injunction, order for
specific performance or for recovery of property, (iv) attachment of its assets
(whether

 
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before or after judgment) and (v) execution or enforcement of any judgment to
which it or its revenues or assets might otherwise be entitled in any
Proceedings in the courts of any jurisdiction and irrevocably agrees, to the
extent permitted by applicable law, that it will not claim any such immunity in
any Proceedings.

14. Definitions

As used in this Agreement: —

  “Additional Termination Event” has the meaning specified in Section 5(b).    
“Affected Party” has the meaning specified in Section 5(b).     “Affected
Transactions” means (a) with respect to any Termination Event consisting of an
Illegality, Tax Event or Tax Event Upon Merger, all Transactions affected by the
occurrence of such Termination Event and (b) with respect to any other
Termination Event, all Transactions.     “Affiliate” means, subject to the
Schedule, in relation to any person, any entity controlled, directly or
indirectly, by the person, any entity that controls, directly or indirectly, the
person or any entity directly or indirectly under common control with the
person. For this purpose, “control” of any entity or person means ownership of a
majority of the voting power of the entity or person.     “Applicable Rate”
means: —

  (a) in respect of obligations payable or deliverable (or which would have been
but for Section 2(a)(iii)) by a Defaulting Party, the Default Rate;     (b) in
respect of an obligation to pay an amount under Section 6(e) of either party
from and after the date (determined in accordance with Section 6(d)(ii)) on
which that amount is payable, the Default Rate;     (c) in respect of all other
obligations payable or deliverable (or which would have been but for
Section 2(a)(iii)) by a Non-defaulting Party, the Non-default Rate; and     (d)
in all other cases, the Termination Rate.

  “Burdened Party” has the meaning specified in Section 5(b).     “Change in Tax
Law” means the enactment, promulgation, execution or ratification of, or any
change in or amendment to, any law (or in the application or official
interpretation of any law) that occurs on or after the date on which the
relevant Transaction is entered into.     “consent” includes a consent,
approval, action, authorisation, exemption, notice, filing, registration or
exchange control consent.     “Credit Event Upon Merger” has the meaning
specified in Section 5(b).     “Credit Support Document” means any agreement or
instrument that is specified as such in this Agreement.     “Credit Support
Provider” has the meaning specified in the Schedule.     “Default Rate” means a
rate per annum equal to the cost (without proof or evidence of any actual cost)
to the relevant payee (as certified by it) if it were to fund or of funding the
relevant amount plus 1% per annum.     “Defaulting Party” has the meaning
specified in Section 6(a).     “Early Termination Date” means the date
determined in accordance with Section 6(a) or 6(b)(iv).     “Event of Default”
has the meaning specified in Section 5(a) and, if applicable, in the Schedule.  
  “Illegality” has the meaning specified in Section 5(b).     “Indemnifiable
Tax” means any Tax other than a Tax that would not be imposed in respect of a
payment under this Agreement but for a present or former connection between the
jurisdiction of the government or

 
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  taxation authority imposing such Tax and the recipient of such payment or a
person related to such recipient (including, without limitation, a connection
arising from such recipient or related person being or having been a citizen or
resident of such jurisdiction, or being or having been organised, present or
engaged in a trade or business in such jurisdiction, or having or having had a
permanent establishment or fixed place of business in such jurisdiction, but
excluding a connection arising solely from such recipient or related person
having executed, delivered, performed its obligations or received a payment
under, or enforced, this Agreement or a Credit Support Document).     “law”
includes any treaty, law, rule or regulation (as modified, in the case of tax
matters, by the practice of any relevant governmental revenue authority) and
“lawful” and “unlawful” will be construed accordingly.     “Local Business Day”
means, subject to the Schedule, a day on which commercial banks are open for
business (including dealings in foreign exchange and foreign currency deposits)
(a) in relation to any obligation under Section 2(a)(i), in the place(s)
specified in the relevant Confirmation or, if not so specified, as otherwise
agreed by the parties in writing or determined pursuant to provisions contained,
or incorporated by reference, in this Agreement, (b) in relation to any other
payment, in the place where the relevant account is located and, if different,
in the principal financial centre, if any, of the currency of such payment,
(c) in relation to any notice or other communication, including notice
contemplated under Section 5(a)(i), in the city specified in the address for
notice provided by the recipient and, in the case of a notice contemplated by
Section 2(b), in the place where the relevant new account is to be located and
(d) in relation to Section 5(a)(v)(2), in the relevant locations for performance
with respect to such Specified Transaction.     “Loss” means, with respect to
this Agreement or one or more Terminated Transactions, as the case may be, and a
party, the Termination Currency Equivalent of an amount that party reasonably
determines in good faith to be its total losses and costs (or gain, in which
case expressed as a negative number) in connection with this Agreement or that
Terminated Transaction or group of Terminated Transactions, as the case may be,
including any loss of bargain, cost of funding or, at the election of such party
but without duplication, loss or cost incurred as a result of its terminating,
liquidating, obtaining or reestablishing any hedge or related trading position
(or any gain resulting from any of them). Loss includes losses and costs (or
gains) in respect of any payment or delivery required to have been made
(assuming satisfaction of each applicable condition precedent) on or before the
relevant Early Termination Date and not made, except, so as to avoid
duplication, if Section 6(e)(i)(1) or (3) or 6(e)(ii)(2)(A) applies. Loss does
not include a party’s legal fees and out-of-pocket expenses referred to under
Section 11. A party will determine its Loss as of the relevant Early Termination
Date, or, if that is not reasonably practicable, as of the earliest date
thereafter as is reasonably practicable. A party may (but need not) determine
its Loss by reference to quotations of relevant rates or prices from one or more
leading dealers in the relevant markets.     “Market Quotation” means, with
respect to one or more Terminated Transactions and a party making the
determination, an amount determined on the basis of quotations from Reference
Market-makers. Each quotation will be for an amount, if any, that would be paid
to such party (expressed as a negative number) or by such party (expressed as a
positive number) in consideration of an agreement between such party (taking
into account any existing Credit Support Document with respect to the
obligations of such party) and the quoting Reference Market-maker to enter into
a transaction (the “Replacement Transaction”) that would have the effect of
preserving for such party the economic equivalent of any payment or delivery
(whether the underlying obligation was absolute or contingent and assuming the
satisfaction of each applicable condition precedent) by the parties under
Section 2(a)(i) in respect of such Terminated Transaction or group of Terminated
Transactions that would, but for the occurrence of the relevant Early
Termination Date, have been required after that date. For this purpose, Unpaid
Amounts in respect of the Terminated Transaction or group of Terminated
Transactions are to be excluded but, without limitation, any payment or delivery
that would, but for the relevant Early Termination Date, have been required
(assuming satisfaction of each applicable condition precedent) after that Early
Termination Date is to be included. The Replacement Transaction would be subject
to such documentation as such party and the Reference Market-maker may, in good
faith, agree. The party making the determination (or its agent) will request
each Reference Market-maker to provide its quotation to the extent reasonably
practicable as of the same day and time (without regard to different time zones)
on or as

 
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  soon as reasonably practicable after the relevant Early Termination Date. The
day and time as of which those quotations are to be obtained will be selected in
good faith by the party obliged to make a determination under Section 6(e), and,
if each party is so obliged, after consultation with the other. If more than
three quotations are provided, the Market Quotation will be the arithmetic mean
of the quotations, without regard to the quotations having the highest and
lowest values. If exactly three such quotations are provided, the Market
Quotation will be the quotation remaining after disregarding the highest and
lowest quotations. For this purpose, if more than one quotation has the same
highest value or lowest value, then one of such quotations shall be disregarded.
If fewer than three quotations are provided, it will be deemed that the Market
Quotation in respect of such Terminated Transaction or group of Terminated
Transactions cannot be determined.     “Non-default Rate” means a rate per annum
equal to the cost (without proof or evidence of any actual cost) to the
Non-defaulting Party (as certified by it) if it were to fund the relevant
amount.     “Non-defaulting Party” has the meaning specified in Section 6(a).  
  “Office” means a branch or office of a party, which may be such party’s head
or home office.     “Potential Event of Default” means any event which, with the
giving of notice or the lapse of time or both, would constitute an Event of
Default.     “Reference Market-makers” means four leading dealers in the
relevant market selected by the party determining a Market Quotation in good
faith (a) from among dealers of the highest credit standing which satisfy all
the criteria that such party applies generally at the time in deciding whether
to offer or to make an extension of credit and (b) to the extent practicable,
from among such dealers having an office in the same city.     “Relevant
Jurisdiction” means, with respect to a party, the jurisdictions (a) in which the
party is incorporated, organised, managed and controlled or considered to have
its seat, (b) where an Office through which the party is acting for purposes of
this Agreement is located, (c) in which the party executes this Agreement and
(d) in relation to any payment, from or through which such payment is made.    
“Scheduled Payment Date” means a date on which a payment or delivery is to be
made under Section 2(a)(i) with respect to a Transaction.     “Set-off” means
set-off, offset, combination of accounts, right of retention or withholding or
similar right or requirement to which the payer of an amount under Section 6 is
entitled or subject (whether arising under this Agreement, another contract,
applicable law or otherwise) that is exercised by, or imposed on, such payer.  
  “Settlement Amount” means, with respect to a party and any Early Termination
Date, the sum of: —

  (a) the Termination Currency Equivalent of the Market Quotations (whether
positive or negative) for each Terminated Transaction or group of Terminated
Transactions for which a Market Quotation is determined; and     (b) such
party’s Loss (whether positive or negative and without reference to any Unpaid
Amounts) for each Terminated Transaction or group of Terminated Transactions for
which a Market Quotation cannot be determined or would not (in the reasonable
belief of the party making the determination) produce a commercially reasonable
result.

  “Specified Entity” has the meanings specified in the Schedule.     “Specified
Indebtedness” means, subject to the Schedule, any obligation (whether present or
future, contingent or otherwise, as principal or surety or otherwise) in respect
of borrowed money.     “Specified Transaction” means, subject to the Schedule,
(a) any transaction (including an agreement with respect thereto) now existing
or hereafter entered into between one party to this Agreement (or any Credit
Support Provider of such party or any applicable Specified Entity of such party)
and the other party to this Agreement (or any Credit Support Provider of such
other party or any applicable Specified Entity of such other party) which is a
rate swap transaction, basis swap, forward rate transaction, commodity swap,
commodity option, equity or equity index swap, equity or equity index option,
bond option, interest rate option, foreign

 
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  exchange transaction, cap transaction, floor transaction, collar transaction,
currency swap transaction, cross-currency rate swap transaction, currency option
or any other similar transaction (including any option with respect to any of
these transactions), (b) any combination of these transactions and (c) any other
transaction identified as a Specified Transaction in this Agreement or the
relevant confirmation.     “Stamp Tax” means any stamp, registration,
documentation or similar tax.     “Tax” means any present or future tax, levy,
impost, duty, charge, assessment or fee of any nature (including interest,
penalties and additions thereto) that is imposed by any government or other
taxing authority in respect of any payment under this Agreement other than a
stamp, registration, documentation or similar tax.     “Tax Event” has the
meaning specified in Section 5(b).     “Tax Event Upon Merger” has the meaning
specified in Section 5(b).     “Terminated Transactions” means with respect to
any Early Termination Date (a) if resulting from a Termination Event, all
Affected Transactions and (b) if resulting from an Event of Default, all
Transactions (in either case) in effect immediately before the effectiveness of
the notice designating that Early Termination Date (or, if “Automatic Early
Termination” applies, immediately before that Early Termination Date).    
“Termination Currency” has the meaning specified in the Schedule.    
“Termination Currency Equivalent” means, in respect of any amount denominated in
the Termination Currency, such Termination Currency amount and, in respect of
any amount denominated in a currency other than the Termination Currency (the
“Other Currency”), the amount in the Termination Currency determined by the
party making the relevant determination as being required to purchase such
amount of such Other Currency as at the relevant Early Termination Date, or, if
the relevant Market Quotation or Loss (as the case may be), is determined as of
a later date, that later date, with the Termination Currency at the rate equal
to the spot exchange rate of the foreign exchange agent (selected as provided
below) for the purchase of such Other Currency with the Termination Currency at
or about 11:00 a.m. (in the city in which such foreign exchange agent is
located) on such date as would be customary for the determination of such a rate
for the purchase of such Other Currency for value on the relevant Early
Termination Date or that later date. The foreign exchange agent will, if only
one party is obliged to make a determination under Section 6(e), be selected in
good faith by that party and otherwise will be agreed by the parties.    
“Termination Event” means an Illegality, a Tax Event or a Tax Event Upon Merger
or, if specified to be applicable, a Credit Event Upon Merger or an Additional
Termination Event.     “Termination Rate” means a rate per annum equal to the
arithmetic mean of the cost (without proof or evidence of any actual cost) to
each party (as certified by such party) if it were to fund or of funding such
amounts.     “Unpaid Amounts” owing to any party means, with respect to an Early
Termination Date, the aggregate of (a) in respect of all Terminated
Transactions, the amounts that became payable (or that would have become payable
but for Section 2(a)(iii)) to such party under Section 2(a)(i) on or prior to
such Early Termination Date and which remain unpaid as at such Early Termination
Date and (b) in respect of each Terminated Transaction, for each obligation
under Section 2(a)(i) which was (or would have been but for Section 2(a)(iii))
required to be settled by delivery to such party on or prior to such Early
Termination Date and which has not been so settled as at such Early Termination
Date, an amount equal to the fair market value of that which was (or would have
been) required to be delivered as of the originally scheduled date for delivery,
in each case together with (to the extent permitted under applicable law)
interest, in the currency of such amounts, from (and including) the date such
amounts or obligations were or would have been required to have been paid or
performed to (but excluding) such Early Termination Date, at the Applicable
Rate. Such amounts of interest will be calculated on the basis of daily
compounding and the actual number of days elapsed. The fair market value of any
obligation referred to in clause (b) above shall be reasonably determined by the
party obliged to make the determination under Section 6(e) or, if each party is
so obliged, it shall be the average of the Termination Currency Equivalents of
the fair market values reasonably determined by both parties.

 
17

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IN WITNESS WHEREOF the parties have executed this document on the respective
dates specified below with effect from the date specified on the first page of
this document.

        HUB INTERNATIONAL LIMITED

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

  BANK OF MONTREAL

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

(Name of Party)
  (Name of Party)  
By:  Dennis J. Pauls

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

  By:  R.J. Mailloux

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

   Name: Dennis J. Pauls
     Name: R.J. Mailloux
   Title:   Vice President and Chief Financial Officer
     Title:   Senior Manager Documentation
   Date:   April 28, 2004
     Date:   April 19, 2004

 
18

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(Multicurrency — Cross Border)
ISDA

SCHEDULE

to the

MASTER AGREEMENT
dated as of July 15, 2003
between
HUB INTERNATIONAL LIMITED (“Party A”)
and
BANK OF MONTREAL (“Party B”)

PART 1

TERMINATION PROVISIONS

(a)   “Specified Entity” means in relation to Party A for the purpose of:–

     Section 5(a)(v), Section 5(a)(vi), Section 5(a)(vii), and Section 5(b)(iv),
each Material Subsidiary (as such term is defined in the Private Placement
Memorandum dated June 10, 2003)

     and in relation to Party B for the purpose of:-

  Section 5(a)(v), Not Applicable   Section 5(a)(vi), Not Applicable  
Section 5(a)(vii), Not Applicable   Section 5(b)(iv), Not Applicable

(b)  “Specified Transaction” will have the meaning specified in Section 14 of
this Agreement.

(c) The “Cross Default” provisions of Section 5(a)(vi) will apply to Party A and
Party B.

  “Specified Indebtedness” will have the meaning specified in Section 14,
provided that it will also include any obligation (whether present or future,
contingent or otherwise, as principal or surety or otherwise) in respect of any
Derivative Transaction and will not include (i) indebtedness in respect of
deposits received or (ii) any payment not made because of an intervening change
in law making such payment illegal, Force Majeure or act of state, provided that
the party had available sufficient funds to make such payment at the time of
non-payment.     “Threshold Amount” shall have the meaning set forth below; for
purposes of “Threshold Amount”, “Equity” means the stockholders’ equity
including retained earnings, total partnership capital, net assets, or total
capital and reserves, as the case may be, of the Party or its Credit Support
Provider.     “Threshold Amount” means in relation to Party A or any Credit
Support Provider of Party A, (i) zero with respect to Specified Indebtedness to
Party B or any Affiliate of Party B and (ii) CAD 100,000 with respect to other
Specified Indebtedness.     “Threshold Amount” means, with respect to Party B,
2% of the Equity of Party B.

(d) The “Credit Event Upon Merger” provisions of Section 5(b)(iv) will apply to
Party A and Party B.   (e) The “Automatic Early Termination” provisions of
Section 6(a) will not apply to Party A and will not apply to Party B.   (f)
Payments on Early Termination. For the purpose of Section 6(e) of this
Agreement:–

  (i) Market Quotation will apply.

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

 

     (ii)  The Second Method will apply.

(g)  “Termination Currency” means Canadian Dollars.

(h) Additional Termination Event will apply. The following shall constitute an
Additional Termination Event as to which Party A shall be the Affected Party:

  (i) if the Notes (as defined in the Private Placement Memorandum) issued under
the Private Placement Memorandum dated June 10, 2003 are cancelled or prepaid on
the part of Party A.

PART 2

TAX REPRESENTATIONS

(a)   Payer Representation. For the purpose of Section 3(e) of this Agreement,
Party A and Party B will each make the following representation:-

  It is not required by any applicable law, as modified by the practice of any
relevant governmental revenue authority, of any Relevant Jurisdiction to make
any deduction or withholding for or on account of any Tax from any payment
(other than interest under Section 2(e), 6(d)(ii) or 6(e) of this Agreement) to
be made by it to the other party under this Agreement. In making this
representation, it may rely on:-

  (i) the accuracy of any representations made by the other party pursuant to
Section 3(f) of this Agreement;     (ii) the satisfaction of the agreement
contained in Section 4(a)(i) or 4(a)(iii) of this Agreement and the accuracy and
effectiveness of any document provided by the other party pursuant to
Section 4(a)(i) or 4(a)(iii) of this Agreement; and     (iii) the satisfaction
of the agreement of the other party contained in Section 4(d) of this Agreement;

  provided that it shall not be a breach of this representation where reliance
is placed on clause (ii) and the other party does not deliver a form or document
under Section 4(a)(iii) by reason of material prejudice to its legal or
commercial position.

(b)  Payee Representations. For the purpose of Section 3(f) of this Agreement,
Party A and Party B make the representations specified below, if any:-

  (i) The following representation will apply to Party A and will apply to Party
B when Party B is acting through its Toronto office:-

  It is fully eligible for the benefits of the “Business Profits” or “Industrial
and Commercial Profits” provision, as the case may be, the “Interest” provision
or the “Other Income” provision (if any) of the Specified Treaty with respect to
any payment described in such provisions and received or to be received by it in
connection with this Agreement and no such payment is attributable to a trade or
business carried on by it through a permanent establishment in the Specified
Jurisdiction.     “Specified Treaty” means with respect to Party B or Party A as
Payee, the income tax convention between Canada and the United States of
America.     “Specified Jurisdiction” means the United States of America.

  (ii) The following representation will not apply to Party A and will apply to
Party B when Party B is acting through its Chicago office:-

  Each payment received or to be received by it in connection with this
Agreement will be effectively connected with its conduct of a trade or business
in the United States of America.

  (iii) The following representation will not apply to Party A and will apply to
Party B when Party B is acting through its London office:-

  It is a party to the Transaction other than as agent or nominee for another
person and will be taxed in the United Kingdom on profits earned in the United
Kingdom.

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

 

PART 3

AGREEMENT TO DELIVER DOCUMENTS

For the purpose of Sections 4(a)(i) and (ii) of this Agreement, each party
agrees to deliver the following documents, as applicable:

  (a) Each party shall, as soon as practicable after demand, deliver to the
other Party any form or document reasonably requested by the other party,
including without limitation, any form or document required to enable such other
party to make payments hereunder without withholding for or on account of Taxes
or with such withholding at a reduced rate. Without limiting the generality of
the foregoing:

                      Covered by Party required to Date by which Section 3(d)
deliver document Form/Document/Certificate to be delivered Representation    
Party A     Form W-8-ECI with respect to Transactions entered into by Party A’s
U.S. Office.   Upon execution of this Agreement     Yes       Party A    
Form W-8-BEN with respect to Transactions entered into by Party A’s
non-U.S. Offices   Upon execution of this Agreement     Yes       Party B    
Form W-8-ECI, with respect to Transactions entered into by Party B’s Chicago
Office   Upon execution of this Agreement     Yes       Party B     Form W-8-BEN
with respect to Transactions entered into by Party B’s London and Toronto
Offices   Upon execution of this Agreement     Yes  

  Other documents to be delivered by each party concurrently with the execution
and delivery of this Agreement are:

                      Covered by Party Required to Date by which Section 3(d)
deliver document Form/Document/Certificate to be Delivered Representation    
Party A & B     Incumbency Certificate   Execution and delivery of Agreement    
Yes       Party A and Party B     Resolution or other documents evidencing the
authority of the party entering into this Agreement and the persons acting on
behalf of such party.   Upon execution of this Agreement, and if requested, each
Confirmation     Yes       Party A     Each Credit Support Document of such
party listed in Part 4(f) of this Schedule   Upon execution of this Agreement  
  Yes       Party A     Legal Opinion in Substantially the form appended as
Exhibit I   Execution and delivery of Agreement     No       Party A     Legal
Opinions concerning Party A’s Credit Support Providers, substantially in the
form of Exhibit II   Upon execution of this Agreement     No  

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

 

PART 4

MISCELLANEOUS

(a)  Addresses for Notices. For the purpose of Section 12(a) of this Agreement:-

     Address(es) for notices or communications to Party A:-

  Address:  Hub International Limited

  55 East Jackson Blvd.   Chicago, Illinois 60604     Attention:  Kirk James  
Facsimile:  312-279-4981   Telephone: 312-279-4881

     Address(es) for notices or communications to Party B:–

     With respect to Transactions:

  Address:  Bank of Montreal

  130 Adelaide Street West, Suite 500   Toronto, Ontario M5H 4E1   Canada  
Attention:  Manager, Confirmations   Facsimile:  (416) 867-4778/6827  
Telephone: (416) 867-7173

Any other notice sent to Party B (including without limitation, any notice in
connection with Section 5, 6 or 9(b)) shall be copied to the following address:

  Address:  Bank of Montreal

  Treasury Credit, 24th Floor   First Canadian Place   Toronto, Ontario M5X 1A1
  Canada   Attention:  Senior Manager, Documentation   Telephone: (416) 867-4178

(b) Process Agent. For purposes of Section 13(c) of this Agreement:-

  Party A appoints as its Process Agent: Not Applicable.     Party B appoints as
its Process Agent: Not Applicable.     (c)  Offices. The provisions of
Section 10(a) will apply to this Agreement.     (d) Multibranch Party. For the
purpose of Section 10(c) of this Agreement:-     Party A is not a Multibranch
Party.     Party B is a Multibranch Party and, for purposes of this Agreement
and each Transaction entered into pursuant hereto, may act through its Toronto,
Chicago or London Offices.

(e) Calculation Agent. The Calculation Agent is Party B, unless otherwise
specified in a Confirmation in relation to the relevant Transaction.   (f)
Credit Support Document(s). With respect to Party A, means the Guarantees from
each Material Subsidiary of Party A for the obligations of Party A under this
Agreement.   (g) Credit Support Provider. With respect to Party A, means each
Material Subsidiary of Party A.

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

 

(h) Governing Law. This Agreement will be governed by and construed in
accordance with the laws of the Province of Ontario and the laws of Canada
applicable therein.   (i) Netting of Payments. Subparagraph (ii) of Section 2(c)
shall apply to all Transactions.   (j) “Affiliate” will have the meaning
specified in Section 14 of this Agreement.

PART 5

OTHER PROVISIONS

(a) 2000 ISDA Definitions. The provisions of the 2000 ISDA Definitions (the
“Definitions”), published by the International Swaps and Derivatives
Association, Inc., are incorporated by reference in, and will be deemed to be
part of, this Agreement and each Confirmation as if set forth in full in this
Agreement or in such Confirmation, without regard to any revision or subsequent
edition thereof. In the event of any inconsistency between the provisions of
this Agreement and the Definitions, this Agreement will prevail. In the event of
any inconsistency between the provisions of any Confirmation and this Agreement
or the Definitions, such Confirmation will prevail for the purpose of the
relevant transaction.   (b) Illegality or Force Majeure. As contemplated by
Section 6 of this Agreement, while neither party shall be obligated to violate
any applicable law by reason of Section 6 or this Part 5(b), each party shall
retain its right to payment pursuant to Section 6(e) if the other party does not
perform because of Illegality or Force Majeure.   (c) Set-off. Any amount (the
“Early Termination Amount”) payable to one party (the “Payee”) by the other
party (the “Payer”) under Section 6(e), in circumstances where there is a
Defaulting Party or one Affected Party in the case where a Termination Event
under Section 5(b)(iv) or 5(b)(v) has occurred, will, at the option of the party
(“X”) other than the Defaulting Party or the Affected Party (and without prior
notice to the Defaulting Party or the Affected Party), be reduced by its set-off
against any amount(s) (the “Other Agreement Amount”) payable (whether at such
time or in the future or upon the occurrence of a contingency) by the Payee to
the Payer (irrespective of the currency, place of payment or booking office of
the obligation) under any other agreement(s) between the Payee and the Payer or
instrument(s) or undertaking(s) issued or executed by one party to, or in favour
of, the other party (and the Other Agreement Amount will be discharged promptly
and in all respects to the extent it is so set-off). X will give notice to the
other party of any set-off effected under this Section.

  For this purpose, either the Early Termination Amount or the Other Agreement
Amount (or the relevant portion of such amounts) may be converted by X into the
currency in which the other is denominated at the rate of exchange at which such
party would be able, acting in a reasonable manner and in good faith, to
purchase the relevant amount of such currency.     If an obligation is
unascertained, X may in good faith estimate that obligation and set-off in
respect of the estimate, subject to the relevant party accounting to the other
when the obligation is ascertained.     Nothing in this Section shall be
effective to create a charge or other security interest. This Section shall be
without prejudice and in addition to any right of set-off, combination of
accounts, lien or other right to which any party is at any time otherwise
entitled (whether by operation of law, contract or otherwise).

(d) Conditions to Certain Payments. Notwithstanding the provision of
Section 6(e)(i)(3) and (4), as applicable, if the amount referred to therein is
a positive number, the Defaulting Party will pay such amount to the
Non-defaulting Party, and if the amount referred to therein is a negative
number, except to the extent set out below, the Non-defaulting Party shall have
no obligation to pay any amount thereunder to the Defaulting Party unless and
until the conditions set forth in (i) and (ii) below have been satisfied, at
which time there shall arise an obligation of the Non-defaulting Party to pay to
the Defaulting Party an amount equal to the absolute value of such negative
number less any and all amounts which the Defaulting Party may be obligated to
pay under Section 11 (the “Conditional Payment Amount”):

  (i) the Non-defaulting Party shall have received confirmation satisfactory to
it in its sole discretion (which may include an unqualified opinion of its
counsel) that (x) no further payments or deliveries under Section 2(a)(i) or
2(e) in respect of Terminated Transactions will be required to be made in
accordance with Section 6(c)(ii) and (y) each Specified Transaction shall have
terminated pursuant to its specified

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

 

  termination date or through the exercise by a party of a right to terminate
and all obligations owing under each such Specified Transaction shall have been
fully and finally performed;     (ii) all obligations (contingent or absolute,
matured or unmatured) of the Defaulting Party and any Affiliate of the
Defaulting Party to make any payment or delivery to the Non-defaulting Party or
any Affiliate of the Non-defaulting Party shall have been fully and finally
performed;

  provided that if the Conditional Payment Amount exceeds the aggregate amount
of the obligations owing to the Non-defaulting Party and Affiliates of the
Non-defaulting Party by the Defaulting Party and Affiliates of the Defaulting
Party (including without limitation all obligations owing under each Specified
Transaction), the Non-defaulting Party shall pay the amount of the excess to the
Defaulting Party.

(e) Relationship between the Parties. Each party will be deemed to represent to
the other party on the date on which it enters into a Transaction that (absent a
written agreement between the parties that expressly imposes affirmative
obligations to the contrary for that Transaction):

  (i) Non-Reliance. It is acting for its own account, and it has made its own
independent decision to enter into that Transaction and as to whether that
Transaction is appropriate or proper for it based upon its own judgment and upon
advice from such advisors as it has deemed necessary. It is not relying on any
communication (written or oral) of the other Party as investment advice or as a
recommendation to enter into that Transaction; it being understood that
information and explanations related to the terms and conditions of a
Transaction shall not be considered investment advice or a recommendation to
enter into that Transaction. No communication (written or oral) received from
the other party shall be deemed to be an assurance or guarantee as to the
expected results of that Transaction.     (ii) Assessment and Understanding. It
is capable of assessing the merits of and understanding (on its own behalf or
through independent professional advice), and understands and accepts the terms,
conditions and risks of that Transaction. It is also capable of assuming, and
assumes, the risks of that Transaction.     (iii) Status of Parties. The other
party is not acting as a fiduciary for or an advisor to it in respect of that
Transaction.

(f) Telephone Recording. Each party (i) consents to the recording of telephone
conversations of trading and marketing personnel of the parties in connection
with this Agreement or any potential or actual Transaction hereunder;
(ii) agrees to obtain any necessary consent of and give notice of such recording
to its trading and marketing personnel; and (iii) agrees that such recordings
may be submitted in evidence in any proceeding relating to this Agreement,
subject to applicable rules of discovery and evidence.   (g) Additional
Definitions. The following definition shall be added to Section 14 in its
appropriate alphabetical place:

  “Derivative Transaction” means (a) any transaction which is a rate swap
transaction, basis swap, forward rate transaction, commodity swap, commodity
option, equity or equity index swap, equity or equity index option, bond option,
interest rate option, foreign exchange transaction, cap transaction, floor
transaction, collar transaction, currency swap transaction, cross-currency rate
swap transaction, currency option or any other similar transaction (including
any option with respect to any of these transactions) and (b) any combination of
these transactions.     “Force Majeure” is a natural or man-made disaster, armed
conflict, riot, civil disturbance, or similar event that materially disrupts
transportation or communication facilities in the relevant city where the party
is to make payment, or otherwise prevents the personnel of the party from
performing their duties in connection with such payment, and is beyond the
control of the party.

(h) Equivalency Clause. For the purpose of disclosure pursuant to the Interest
Act (Canada), the yearly rate of interest to which any rate of interest payable
under this Agreement, which is to be calculated on any basis other than a full
calendar year, is equivalent, may be determined by multiplying such rate by a
fraction, the numerator

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

 

of which is the actual number of days in the calendar year in which the period
for which interest at such rate is payable ends and the denominator of which is
the number of days of such other basis.   (i) Submission to Jurisdiction. In
substitution for the provisions of Section 13(b)(i) of this Agreement, each
party irrevocably submits to the non-exclusive jurisdiction of the court of
competent jurisdiction of the Province of Ontario, without reference to the
choice of law doctrine.   (j) WAIVER OF JURY TRIAL: EACH PARTY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING RELATING TO THIS AGREEMENT,
ANY CREDIT SUPPORT DOCUMENT OR ANY TRANSACTION. EACH PARTY ACKNOWLEDGES THAT IT
AND THE OTHER PARTY HAVE ENTERED INTO THIS AGREEMENT AND ANY CREDIT SUPPORT
DOCUMENT, AS APPLICABLE, IN RELIANCE ON, AMONG OTHER THINGS, THE MUTUAL WAIVERS
IN THIS SECTION.   (k) Right to Terminate. Either party (the “Terminating
Party”) may, provided that no Event of Default or Potential Event of Default
exists with respect to that party , elect to terminate any Transaction under
this Agreement on the fourth (4th) anniversary of the Effective Date of such
Transaction or every four (4) years thereafter, (the “Optional Termination
Date”), by providing at least thirty (30) days prior notice to the other party
(the “Other Party”). Notice may be provided by telephone but is to be followed
up with a written notice to be received by the Other Party prior to the Optional
Termination Date. In the event the Terminating Party elects to terminate a
Transaction pursuant to the foregoing, the Terminating Party shall at or prior
to 2:00 p.m. Toronto time on the Optional Termination Date, determine the amount
payable in respect of the terminated Transaction (the “Market Value”) by making
the calculations required by Section 6(e)(i) of the Agreement as if the Optional
Termination Date were an Early Termination Date designated as a result of the
occurrence of an Event of Default with respect to the Terminating Party and the
parties had specified Loss and the Second Method for that purpose. The Market
Value will be paid by the relevant party on the second Business Day following
the Optional Termination Date.

  If there is a dispute between the parties as to the calculation of the Market
Value,

  (a) the parties will consult with each other in an attempt to resolve the
dispute; and     (b) if the parties fail to resolve the dispute prior to
3:00 p.m. Toronto time on the Optional Termination Date, then Bank of Montreal
shall recalculate the Market Value by making calculations required by
Section 6(e)(i) of the Agreement as if the Optional Termination Date were an
Early Termination Date designated as a result of the occurrence of an Event of
Default with respect to the Terminating Party and the parties had specified
Market Quotation and the Second Method for that purpose.

  Promptly following a resolution pursuant to this paragraph, the Market Value
will be paid by the relevant party on the second Business Day following the
Optional Termination Date.     Upon payment of such sum as provided herein, the
obligations of both parties with respect to this Transaction shall be discharged
in full.

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

 

(l) Commodity Exchange Act. Each party represents to the other party on and as
of the date hereof and on each date on which a Transaction is entered into among
them that:

  (i) such party is an “eligible contract participant” as defined in the
U.S. Commodity Exchange Act, as amended (the “CEA”).

 

              HUB INTERNATIONAL LIMITED   BANK OF MONTREAL  
By:
  /s/  Dennis J. Pauls   By:   /s/  R. J. Mailloux  
Name:
  Dennis J. Pauls   Name:   R. J. Mailloux  
Title:
  VP and Chief Financial Officer   Title:   Senior Manager Documentation  
Date:
  April 28, 2004   Date:   April 19, 2004

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

 

EXHIBIT I

LETTERHEAD OF COUNTERPARTY’S COUNSEL

Date

Bank of Montreal

First Canadian Place
Toronto, Ontario
M5X 1A1

Dear Sirs:

     This opinion is furnished to you in connection with the ISDA Master
Agreement dated as of July 15, 2003 (the “Agreement”) and the Confirmation dated
July 15, 2003 between Hub International Limited (the “Counterparty”) and Bank of
Montreal (the “Bank”). Terms defined in the Agreement and used but not defined
herein have the meanings given to them in the Agreement.

     We have acted as counsel to the Counterparty in connection with the
execution and delivery of the Agreement. We have examined the Agreement, the
Counterparty’s constating documents and such other documents as we have deemed
necessary or appropriate for purposes of the opinions expressed herein. We have
also made such investigations and considered such questions of law as we have
considered necessary for the purpose of rendering this opinion. In such
examination we have assumed the genuineness of all signatures, the authenticity
of all documents submitted to us as originals and the conformity to original
documents of all documents submitted to us as copies, certified or otherwise.

     We express no opinion with respect to the laws of any jurisdiction other
than the laws of Ontario and the laws of Canada applicable therein.

     Based on the foregoing we are of the opinion that:

  1.  The Counterparty has been duly incorporated and is validly existing and in
good standing under the laws of Ontario.     2.  The execution and delivery of
the Agreement and each Confirmation entered into by the parties on or prior to
the date hereof and the performance by the Counterparty of its obligations
thereunder have been duly authorized by the Counterparty, are within the
corporate power of the Counterparty and do not conflict with, or result in a
breach of, (i) the constating documents of the Counterparty, (ii) any law or
regulation, or (iii) any agreement, decree, order, judgment, injunction or other
instrument binding on or affecting the Counterparty.     3.  The Agreement and
each Confirmation entered into by the parties on or prior to the date hereof
have been duly authorized, executed and delivered by the Counterparty to the
Bank.     4.  No action by, notice to or filing with, or consent, authorization
or approval of, any governmental authority or regulatory body is required in
connection with the Counterparty’s execution, delivery and performance of the
Agreement or any Confirmation entered into by the parties on or prior to the
date hereof.     5.  The Agreement and each Transaction evidenced by a
Confirmation outstanding as of the date of execution of the Master Agreement
constitutes a legal, valid and binding obligation of the Counterparty
enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium, and other similar laws and equitable
principles of general application affecting the rights of creditors or limiting
the availability of specific performance, injunctive relief or any other
equitable remedy.

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This opinion is provided solely for your benefit and is not to be relied upon
for any purpose other than in respect of the Agreement or by any other person.

  Yours very truly,     W. Kirk James   Executive Vice President,   Secretary
and General Counsel   Hub International Limited

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EXHIBIT II

Date

Bank of Montreal

First Canadian Place
Toronto, Ontario
M5X 1A1

Dear Sirs:

This opinion is furnished to you in connection with the ISDA Master Agreement
dated as of July 15, 2003 (the “Agreement”) between Hub International Limited
(“Counterparty”) and Bank of Montreal (the “Bank”), in respect of which each
Material Subsidiary (the “Credit Support Provider”) has provided credit support
in the form of a Guarantee dated July 15, 2003 (the “Credit Support Documents”)
covering the obligations of the Counterparty. Terms defined in the Agreement and
used but not defined herein have the meanings given to them in the Agreement.

We have acted as counsel to each Credit Support Provider in connection with the
execution and delivery of the Credit Support Documents. We have examined the
Agreement, the Credit Support Documents, the Credit Support Provider’s
constating documents and such other documents as we have deemed necessary or
appropriate for purposes of the opinions expressed herein. We have also made
such investigations and considered such questions of law as we have considered
necessary for the purpose of rendering this opinion. In such examination we have
assumed the genuineness of all signatures, the authenticity of all documents
submitted to us as originals and the conformity to original documents of all
documents submitted to us as copies, certified or otherwise.

We express no opinion with respect to the laws of any jurisdiction other than
the laws of the respective jurisdiction of organization of each Credit Support
Provider as listed on Exhibit A attached hereto and the laws of federal
jurisdiction applicable therein.

Based on the foregoing we are of the opinion that:

  1.  Each Credit Support Provider has been duly incorporated and is validly
existing and in good standing under the laws of its respective jurisdiction of
organization.     2.  The execution and delivery of each Credit Support Document
and the performance by the respective Credit Support Provider of its obligations
thereunder have been duly authorized by the Credit Support Provider, are within
the corporate power of the Credit Support Provider and do not conflict with, or
result in a breach of, (i) the constating documents of the Credit Support
Provider, (ii) any law or regulation, or (iii) any agreement, decree, order,
judgment, injunction or other instrument binding on or affecting the Credit
Support Provider.     3.  The Credit Support Documents have been duly
authorized, executed and delivered by each Credit Support Provider to the Bank.
    4.  No action by, notice to or filing with, or consent, authorization or
approval of, any governmental authority or regulatory body is required in
connection with any Credit Support Provider’s execution, delivery and
performance of the Credit Support Documents.     5.  The governing law clause,
subjecting the Credit Support Document to the laws of the Province of Ontario is
valid under the laws of the respective jurisdiction of organization of each
Credit Support Provider. Under the laws of the respective jurisdiction of
organization of each Credit Support Provider, the laws of the Province of
Ontario will be applied to the Credit Support Document, provided that such
choice of law is bona fide and provided that such choice of law is not contrary
to public policy, as that term is understood under the laws of the respective
jurisdiction of organization of each Credit Support Provider. To the best of our
knowledge, having made due inquiry, the public policy of the respective
jurisdiction of organization of each Credit Support Provider would not be
breached by application of the chosen law.     6.  A final and conclusive
judgment for sum certain in personam and rendered by a court of competent
jurisdiction in the Province of Ontario with respect to the obligations of each
Credit Support Provider under

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  the respective Credit Support Document would be recognized and enforceable by
a court in the respective jurisdiction of organization of each Credit Support
Provider.     7.  Each Credit Support Document constitutes a legal, valid and
binding obligation of each Credit Support Provider enforceable in accordance
with its terms, subject to applicable bankruptcy, insolvency, reorganization,
moratorium, and other similar laws and equitable principles of general
application affecting the rights of creditors, or limiting the availability of
specific performance, injunctive relief or any other equitable remedy.

This opinion is provided solely for your benefit and is not to be relied upon
for any purpose other than in respect of the Agreement or by any other person.

  Yours very truly,     W. Kirk James   Executive Vice President,   Secretary
and General Counsel   Hub International Limited

 

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EXHIBIT A

      Credit Support Provider Jurisdiction of Organization

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Barton Insurance Brokers Ltd.
  British Columbia, Canada
Martin Assurance & Gestion de Risques Inc.
  Quebec, Canada
TOS Insurance Services Ltd.
  British Columbia, Canada

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EXHIBIT II

LETTERHEAD OF CREDIT SUPPORT PROVIDER’S COUNSEL

Date

Bank of Montreal

First Canadian Place
Toronto, Ontario
M5X 1A1

Dear Sirs:

This opinion is furnished to you in connection with the ISDA Master Agreement
dated as of July 15, 2003 (the “Agreement”) between Hub International Limited
(“Counterparty”) and Bank of Montreal (the “Bank”), in respect of which each
Material Subsidiary (the “Credit Support Provider”) has provided credit support
in the form of a Guarantee dated July 15, 2003 (the “Credit Support Documents”)
covering the obligations of the Counterparty. Terms defined in the Agreement and
used but not defined herein have the meanings given to them in the Agreement.

We have acted as counsel to each Credit Support Provider in connection with the
execution and delivery of the Credit Support Documents. We have examined the
Agreement, the Credit Support Documents, the Credit Support Provider’s
constating documents and such other documents as we have deemed necessary or
appropriate for purposes of the opinions expressed herein. We have also made
such investigations and considered such questions of law as we have considered
necessary for the purpose of rendering this opinion. In such examination we have
assumed the genuineness of all signatures, the authenticity of all documents
submitted to us as originals and the conformity to original documents of all
documents submitted to us as copies, certified or otherwise.

We express no opinion with respect to the laws of any jurisdiction other than
the laws of the respective jurisdiction of organization of each Credit Support
Provider as listed on Exhibit A attached hereto and the laws of federal
jurisdiction applicable therein.

Based on the foregoing we are of the opinion that:

  1.  Each Credit Support Provider has been duly incorporated and is validly
existing and in good standing under the laws of its respective jurisdiction of
organization.     2.  The execution and delivery of each Credit Support Document
and the performance by the respective Credit Support Provider of its obligations
thereunder have been duly authorized by the Credit Support Provider, are within
the corporate power of the Credit Support Provider and do not conflict with, or
result in a breach of, (i) the constating documents of the Credit Support
Provider, (ii) any law or regulation, or (iii) any agreement, decree, order,
judgment, injunction or other instrument binding on or affecting the Credit
Support Provider.     3.  The Credit Support Documents have been duly
authorized, executed and delivered by each Credit Support Provider to the Bank.
    4.  No action by, notice to or filing with, or consent, authorization or
approval of, any governmental authority or regulatory body is required in
connection with any Credit Support Provider’s execution, delivery and
performance of the Credit Support Documents.     5.  The governing law clause,
subjecting the Credit Support Document to the laws of the Province of Ontario is
valid under the laws of the respective jurisdiction of organization of each
Credit Support Provider. Under the laws of the respective jurisdiction of
organization of each Credit Support Provider, the laws of the Province of
Ontario will be applied to the Credit Support Document, provided that such
choice of law is bona fide and provided that such choice of law is not contrary
to public policy, as that term is understood under the laws of the respective
jurisdiction of organization of each Credit Support Provider. To the best of our
knowledge, having made due inquiry, the public policy of the respective
jurisdiction of organization of each Credit Support Provider would not be
breached by application of the chosen law.

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

 

  6.  A final and conclusive judgment for sum certain in personam and rendered
by a court of competent jurisdiction in the Province of Ontario with respect to
the obligations of each Credit Support Provider under the respective Credit
Support Document would be recognized and enforceable by a court in the
respective jurisdiction of organization of each Credit Support Provider.     7. 
Each Credit Support Document constitutes a legal, valid and binding obligation
of each Credit Support Provider enforceable in accordance with its terms,
subject to applicable bankruptcy, insolvency, reorganization, moratorium, and
other similar laws and equitable principles of general application affecting the
rights of creditors, or limiting the availability of specific performance,
injunctive relief or any other equitable remedy.

This opinion is provided solely for your benefit and is not to be relied upon
for any purpose other than in respect of the Agreement or by any other person.

  YOURS VERY TRULY,     ANGELA M. YAZVAC   ASSISTANT GENERAL COUNSEL   HUB
INTERNATIONAL LIMITED

 

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Exhibit A

      Credit Support Provider Jurisdiction of Incorporation

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Hub International of Indiana Limited
  Indiana
C.J. McCarthy Insurance Agency
  Massachusetts
Mack and Parker Inc.
  Illinois
Kaye Group Inc.
  New York