EXHIBIT 10(s) – Credit Agreement dated as of December 11, 2003 among

Lincoln National Corporation, as Borrower, the Banks Party Hereto and JPMorgan
Chase Bank,

as Administrative Agent

 

EXECUTION COPY

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THIRD AMENDED AND RESTATED

 

LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT

 

dated as of

 

December 11, 2003

 

among

 

LINCOLN NATIONAL CORPORATION,

as an Account Party and Guarantor

 

The SUBSIDIARY ACCOUNT PARTIES,

as additional Account Parties

 

The BANKS Party Hereto

 

and

 

JPMORGAN CHASE BANK,

as Administrative Agent

 

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$550,000,000

 

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J.P. MORGAN SECURITIES INC.,

as Sole Advisor, Sole Lead Arranger and Sole Bookrunner

 

THE BANK OF NEW YORK, CITICORP USA, INC.,

WACHOVIA BANK, NATIONAL ASSOCIATION and MELLON BANK, N.A.,

as Syndication Agents

 

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TABLE OF CONTENTS1

 

          Page

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ARTICLE I DEFINITIONS

    

SECTION 1.01.

  

Definitions

    

SECTION 1.02.

  

Accounting Terms and Determinations

    

ARTICLE II THE CREDITS

    

SECTION 2.01.

  

The Commitments

    

SECTION 2.02.

  

Issuance and Administration of Committed Letters of Credit

    

SECTION 2.03.

  

Reimbursement for LC Disbursements, Cover, Etc.

    

SECTION 2.04.

  

Termination, Reduction and Increase of the Commitments

    

SECTION 2.05.

  

Fees

    

SECTION 2.06.

  

Payments Generally; Pro Rata Treatment

    

SECTION 2.07.

  

Alternative Currency Letters of Credit

    

ARTICLE III CONDITIONS

    

SECTION 3.01.

  

Each Credit Event

    

SECTION 3.02.

  

Effectiveness

    

ARTICLE IV REPRESENTATIONS AND WARRANTIES

    

SECTION 4.01.

  

Corporate Existence and Power

    

SECTION 4.02.

  

Corporate and Governmental Authorization; Contravention

    

SECTION 4.03.

  

Binding Effect

    

SECTION 4.04.

  

Financial Information

    

SECTION 4.05.

  

Litigation

    

SECTION 4.06.

  

Compliance with ERISA

    

SECTION 4.07.

  

Taxes

    

SECTION 4.08.

  

Subsidiaries

    

SECTION 4.09.

  

Not an Investment Company

    

SECTION 4.10.

  

Obligations to be Pari Passu

    

SECTION 4.11.

  

No Default

    

SECTION 4.12.

  

Restricted Subsidiaries

    

SECTION 4.13.

  

Environmental Matters

    

SECTION 4.14.

  

Full Disclosure

    

SECTION 4.15.

  

Separate Representations of Subsidiary Account Parties

    

ARTICLE V COVENANTS

    

SECTION 5.01.

  

Information

    

SECTION 5.02.

  

Payment of Obligations

    

SECTION 5.03.

  

Conduct of Business and Maintenance of Existence

    

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1 The Table of Contents is not a part of this Agreement.

 

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SECTION 5.04.

  

Maintenance of Property; Insurance

    

SECTION 5.05.

  

Compliance with Laws

    

SECTION 5.06.

  

Inspection of Property, Books and Records

    

SECTION 5.07.

  

Minimum Adjusted Consolidated Net Worth

    

SECTION 5.08.

  

Adjusted Debt to Total Capitalization Ratio

    

SECTION 5.09.

  

Negative Pledge

    

SECTION 5.10.

  

Consolidations, Mergers and Sales of Assets

    

SECTION 5.11.

  

Use of Credit

    

SECTION 5.12.

  

Obligations to be Pari Passu

    

ARTICLE VI DEFAULTS

    

SECTION 6.01.

  

Events of Default

    

SECTION 6.02.

  

Notice of Default

    

SECTION 6.03.

  

Alternative Currency Letters of Credit

    

ARTICLE VII THE ADMINISTRATIVE AGENT

    

SECTION 7.01.

  

Appointment and Authorization

    

SECTION 7.02.

  

Agent’s Fee

    

SECTION 7.03.

  

Agent and Affiliates

    

SECTION 7.04.

  

Action by Agent

    

SECTION 7.05.

  

Consultation with Experts

    

SECTION 7.06.

  

Liability of Agent

    

SECTION 7.07.

  

Indemnification

    

SECTION 7.08.

  

Credit Decision

    

SECTION 7.09.

  

Successor Agent

    

SECTION 7.10.

  

Delegation to Affiliates

    

SECTION 7.11.

  

Lead Arranger and Other Agents

    

ARTICLE VIII CHANGE IN CIRCUMSTANCES

    

SECTION 8.01.

  

Increased Cost and Reduced Return

    

SECTION 8.02.

  

Taxes

    

ARTICLE IX GUARANTY

    

SECTION 9.01.

  

The Guaranty

    

SECTION 9.02.

  

Guaranty Unconditional

    

SECTION 9.03.

  

Discharge Only Upon Payment In Full; Reinstatement In Certain Circumstances

    

SECTION 9.04.

  

Waiver by the Company

    

SECTION 9.05.

  

Subrogation

    

ARTICLE X MISCELLANEOUS

    

SECTION 10.01.

  

Notices

    

SECTION 10.02.

  

No Waivers

    

SECTION 10.03.

  

Expenses; Indemnification; Non-Liability of Banks

    

SECTION 10.04.

  

Sharing of Set-Offs

    

SECTION 10.05.

  

Amendments and Waivers

    

 

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SECTION 10.06.

  

Successors and Assigns

    

SECTION 10.07.

  

Collateral

    

SECTION 10.08.

  

New York Law

    

SECTION 10.09.

  

Judicial Proceedings

    

SECTION 10.10.

  

Counterparts; Integration

    

SECTION 10.11.

  

Confidentiality

    

SECTION 10.12.

  

WAIVER OF JURY TRIAL

    

SECTION 10.13.

  

Joinder and Termination of Subsidiary Account Party

    

SECTION 10.14.

  

Judgment Currency

    

 

Schedule I

  

Commitments

Schedule II

  

List of Restricted Subsidiaries

EXHIBIT A

  

Form of Assignment and Assumption

EXHIBIT B

  

Form of Confirming Bank Agreement

EXHIBIT C

  

Form of Subsidiary Joinder Agreement

EXHIBIT D

  

Opinion of Dennis L. Schoff, Esq., General Counsel of the Company

EXHIBIT E

  

Opinion of Milbank, Tweed, Hadley & McCloy LLP, Special New York Counsel to
JPMCB

EXHIBIT F

  

Form of Acceptance by CT Corporation System

EXHIBIT G

  

Subsidiary Termination Notice

 

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THIRD AMENDED AND RESTATED LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT dated as
of December 11, 2003 among: LINCOLN NATIONAL CORPORATION, the SUBSIDIARY ACCOUNT
PARTIES party hereto, the BANKS party hereto and JPMORGAN CHASE BANK, as
Administrative Agent.

 

The Account Parties (as hereinafter defined), certain banks party thereto and
JPMorgan Chase Bank, as the administrative agent thereunder are parties to the
Second Amended and Restated Letter of Credit and Reimbursement Agreement dated
as of December 12, 2002 (as amended and in effect immediately prior to the
effectiveness of this Agreement, the “Existing LC Agreement”);

 

The Account Parties and certain of the banks party to the Existing LC Agreement
desire to amend the Existing LC Agreement in certain respects, including the
extension of the availability of the commitments thereunder, and to restate in
its entirety the Existing LC Agreement, as so amended, and, accordingly, the
Account Parties and such banks hereby agree to amend the Existing LC Agreement
and the parties hereto hereby agree to restate the Existing LC Agreement, as so
amended, in its entirety, effective as of the Effective Date (as defined below),
and otherwise agree, as follows:

 

ARTICLE I

 

DEFINITIONS

 

SECTION 1.01. Definitions. The following terms, as used herein, have the
following meanings:

 

“Account Party” means any of the Company and the Subsidiary Account Parties, as
the context may require, and “Account Parties” means all of the foregoing.

 

“Adjusted Consolidated Net Worth” means, at any date, the sum of (a) the
consolidated shareholders’ equity of the Company and its Consolidated
Subsidiaries, plus (b) any unrealized losses (or less any unrealized gains) (in
each case to the extent reflected in the determination of such consolidated
shareholders’ equity) related, directly or indirectly, to securities
available-for-sale, as determined in accordance with Statement of Financial
Accounting Standards No. 115 (or any successor statements or amendments thereto)
(in each case as affected by any subsequent relevant pronouncements of the FASB
or, if, and to the extent applicable, the Securities and Exchange Commission),
plus (c) the Hybrid Security Amount; provided that in calculating Adjusted
Consolidated Net Worth on any date the impact thereon of FIN 46 and DIG B36
shall be excluded.

 

“Adjusted Total Indebtedness” means, at any date, the sum of (i) short-term debt
and long-term debt in the amount that would be reflected on a balance sheet of
the Company prepared as of such date on a consolidated basis in accordance with
GAAP plus (ii) the Hybrid

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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Security Amount on such date; provided that in calculating Adjusted Total
Indebtedness on any date the impact thereon of FIN 46 and DIG B36 shall be
excluded.

 

“Administrative Agent” means JPMCB, in its capacity as agent for the Banks
hereunder, and its successors in such capacity.

 

“Administrative Questionnaire” means, with respect to each Bank, an
administrative questionnaire in the form prepared by the Administrative Agent
and submitted to the Administrative Agent (with a copy to the Company) duly
completed by such Bank.

 

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

 

“Agreement” means this Third Amended and Restated Letter of Credit and
Reimbursement Agreement, as it may be amended or modified and in effect from
time to time.

 

“Alternative Currency” means any currency other than Dollars (a) that is freely
transferable and convertible into Dollars in the London foreign exchange market
and (b) for which no central bank or other governmental authorization in the
country of issue of such currency is required to permit use of such currency by
any Bank for issuing, renewing, extending or amending letter of credits or
funding or making drawings thereunder and/or to permit any Account Party to pay
the reimbursement obligations and interest thereon, unless such authorization
has been obtained and is in full force and effect.

 

“Alternative Currency LC Exposure” means, at any time, the sum of (a) the
aggregate undrawn amount of all outstanding Alternative Currency Letters of
Credit at such time plus (b) the aggregate amount of all LC Disbursements under
Alternative Currency Letters of Credit that have not been reimbursed by or on
behalf of the Account Parties at such time. The Alternative Currency LC Exposure
of any Bank shall at any time be such Bank’s share of the total Alternative
Currency LC Exposure at such time.

 

“Alternative Currency Letter of Credit” means a letter of credit issued by a
Bank in an Alternative Currency pursuant to Section 2.07.

 

“Alternative Currency Letter of Credit Report” has the meaning set forth in
Section 2.07(b).

 

“Applicable Credit Office” means, as to each Bank, the office at which such Bank
shall issue Committed Letters of Credit hereunder as designated in its
Administrative Questionnaire or such other office as such Bank may hereafter
designate as its Applicable Credit Office by notice to the Company and the
Administrative Agent.

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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“Applicable Percentage” means, with respect to any Bank, the percentage of the
total Commitments represented by such Bank’s Commitment. If the Commitments have
terminated or expired, the Applicable Percentages shall be determined based upon
the Commitments most recently in effect, giving effect to any assignments.

 

“Applicable Rate” means, for any day, with respect to the commitment fees or
letter of credit fees payable hereunder, as the case may be, the applicable rate
per annum set forth below under the caption “Commitment Fee” or “Letter of
Credit Fee”, respectively, based upon the ratings by Moody’s and S&P,
respectively, applicable on such date to the Index Debt:

 

    

Index Debt

Ratings

(S&P/Moody’s)

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Commitment

Fee

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Letter of

Credit Fee

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  Category 1    ³ A / A2    0.08 %   0.45 % Category 2       A - / A3    0.10 %
  0.55 % Category 3       BBB+ / Baa1    0.125 %   0.70 % Category 4    £ BBB /
Baa2    0.175 %   0.95 %

 

For purposes of the foregoing, (a) if the ratings established or deemed to have
been established by Moody’s and S&P for the Index Debt shall fall within
different Categories that are one Category apart, the Applicable Rate shall be
determined by reference to the Category of the higher of the two ratings; (b) if
the ratings established or deemed to have been established by Moody’s and S&P
for the Index Debt shall fall within different Categories that are more than one
Category apart, the Applicable Rate shall be determined by reference to the
Category next below that of the higher of the two ratings; (c) if only one of
Moody’s and S&P shall have in effect a rating for the Index Debt, the Applicable
Rate shall be determined by reference to the Category of such rating; (d) if
neither Moody’s nor S&P shall have in effect a rating for the Index Debt (other
than by reason of the circumstances referred to in the last sentence of this
definition), then the applicable rating shall be determined by reference to
Category 4; and (e) if the ratings established or deemed to have been
established by Moody’s and S&P for the Index Debt shall be changed (other than
as a result of a change in the rating system of Moody’s or S&P), such change
shall be effective as of the date on which it is first announced by the
applicable rating agency, irrespective of when notice of such change shall have
been furnished by the Company to the Administrative Agent and the Banks pursuant
to Section 5.01 or otherwise. Each change in the Applicable Rate shall apply
during the period commencing on the effective date of such change and ending on
the date immediately preceding the effective date of the next such change. If
the rating system of Moody’s or S&P shall change, or if either such rating
agency shall cease to be in the business of rating corporate debt obligations,
the Company and the Banks shall negotiate in good faith to amend this definition
to reflect such changed rating system or the unavailability of ratings from such
rating agency and, pending the effectiveness of any such amendment, the

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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Applicable Rate shall be determined by reference to the rating of Moody’s and/or
S&P, as the case may be, most recently in effect prior to such change or
cessation.

 

“Assignee” has the meaning set forth in Section 10.06(c).

 

“Assignment and Assumption” means an assignment and assumption entered into by a
Bank and an assignee (with the consent of any party whose consent is required by
Section 10.06), and accepted by the Administrative Agent, in the form of Exhibit
A or any other form approved by the Administrative Agent.

 

“Bank” means each Person listed under the caption “BANKS” on the signature pages
hereof, and each other Person that shall become a party hereto as a Supplemental
Bank pursuant to Section 2.04(e) or as an assignee Bank pursuant to Section
2.01(g) or 10.06 (other than any such Person that ceases to be a Bank by means
of assignment pursuant to Section 10.06), together with its successors.

 

“Base Rate” means, for any day, a rate per annum equal to the higher of (i) the
Prime Rate for such day and (ii) the sum of 1/2 of 1% plus the Federal Funds
Rate for such day.

 

“Benefit Arrangement” means at any time an employee benefit plan within the
meaning of Section 3(3) of ERISA which is not a Plan or a Multiemployer Plan and
which is maintained or otherwise contributed to by any member of the ERISA
Group.

 

“Business Day” means any day except a Saturday, Sunday or other day on which
commercial banks in New York City are authorized by law to close.

 

“Code” means the Internal Revenue Code of 1986, as amended, or any successor
statute.

 

“Collateral Account” has the meaning set forth in Section 2.03(e).

 

“Commitment” means, with respect to each Bank, the amount set forth opposite the
name of such Bank on Schedule I hereto (or in the Assignment and Assumption, or
in any agreement entered into by such Bank pursuant to Section 2.04(e), in each
case pursuant to which such Bank shall have assumed its Commitment, as
applicable), as such amount may from time to time be reduced pursuant to Section
2.04 or Section 10.06 or increased pursuant to Section 2.04(e) or 10.06. The
initial aggregate amount of the Banks’ Commitment is $550,000,000.

 

“Commitment Availability Period” means the period from and including the
Effective Date to but excluding earlier of the Commitment Termination Date and
the date of termination of the Commitments.

 

“Commitment Termination Date” means February 15, 2007 or, if such day is not a
Business Day, the next preceding Business Day.

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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“Committed LC Exposure” means, at any time, the sum of (a) the aggregate undrawn
amount of all outstanding Committed Letters of Credit at such time plus (b) the
aggregate amount of all LC Disbursements under Committed Letters of Credit that
have not yet been reimbursed by or on behalf of the Account Parties at such
time. The Committed LC Exposure of any Bank shall at any time be its Applicable
Percentage of the total Committed LC Exposure at such time.

 

“Committed Letters of Credit” means Letters of Credit issued under Section 2.01.

 

“Company” means Lincoln National Corporation, an Indiana corporation, and its
successors.

 

“Company’s 2002 Form 10-K” means the Company’s annual report on Form 10-K for
2002, as filed with the Securities and Exchange Commission pursuant to the
Securities Exchange Act of 1934, as amended.

 

“Confirming Bank” means, with respect to any Bank, any other bank that has
agreed, by delivery of a Confirming Bank Agreement in substantially the form of
Exhibit B, that such other bank will itself honor the obligations of such Bank
in respect of a draft complying with the terms of a Letter of Credit as if, and
to the extent, such other bank were the “Issuing Bank” named in such Letter of
Credit.

 

“Consolidated Subsidiary” means at any date any Subsidiary or other entity the
accounts of which would be consolidated with those of the Company in its
consolidated financial statements if such statements were prepared as of such
date.

 

“Credit Documents” means (a) this Agreement, (b) with respect to any Subsidiary
Account Party, the Subsidiary Joinder Agreement to which it is a party and (c)
with respect to any Letter of Credit, collectively, any application therefor and
any other agreements, instruments, guarantees or other documents (whether
general in application or applicable only to such Letter of Credit) governing or
providing for (i) the rights and obligations of the parties concerned or at risk
with respect to such Letter of Credit or (ii) any collateral security for any of
such obligations, each as the same may be modified and supplemented and in
effect from time to time.

 

“Debt” of any Person means at any date, without duplication, (i) all obligations
of such Person for borrowed money, (ii) all obligations of such Person evidenced
by bonds, debentures, notes or other similar instruments, (iii) all obligations
of such Person to pay the deferred purchase price of property or services,
except trade accounts payable arising in the ordinary course of business, (iv)
all obligations of such Person as lessee under capital leases, (v) all
non-contingent obligations of such Person to reimburse any bank or other Person
in respect of amounts paid under a letter of credit or similar instrument, (vi)
all Debt of others secured by a Lien on any asset of such Person, whether or not
such Debt is assumed by such Person, and (vii) all Debt of others Guaranteed by
such Person (it being understood that the definition of “Debt” does not include
any obligations of such Person (i) to purchase securities (or other property)
which arise out of or in connection with the sale of the same or substantially

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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similar securities (or other property) or (ii) to return collateral consisting
of securities arising out of or in connection with the loan of the same or
substantially similar securities).

 

“Default” means any condition or event which constitutes an Event of Default or
which with the giving of notice or lapse of time or both would, unless cured or
waived, become an Event of Default.

 

“Derivative Financial Products” of any Person means all obligations (including
whether pursuant to any master agreement or any particular agreement or
transaction) of such Person in respect of any rate swap transaction, basis swap,
forward rate transaction, interest rate future, 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 future, currency option or any other similar
transaction (including any option with respect to any of the foregoing) or any
combination thereof.

 

“DIG B36” means Statement 133 Implementation Issue No. B36 issued by the
Derivative Implementation Group of FASB in April 2003.

 

“Dollar Equivalent” means, as used in each Alternative Currency Letter of Credit
Report and in respect of any Alternative Currency Letter of Credit, the amount
of Dollars obtained by converting the LC Exposure with respect to such
Alternative Currency Letter of Credit, as specified in such Alternative Currency
Letter of Credit Report, into Dollars at the spot rate for the purchase of
Dollars with such currency as quoted by the Administrative Agent at
approximately 11:00 a.m. (London time) on the second Business Day before the
date of such Alternative Currency Letter of Credit Report (unless another rate
or time is agreed to by the Company and the Administrative Agent).

 

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

 

“Effective Date” means the date this Agreement becomes effective in accordance
with Section 3.02.

 

“Environmental Laws” means any and all federal, state, local and foreign
statutes, laws, regulations, ordinances, rules, judgments, orders, decrees,
permits, concessions, grants, franchises, licenses, agreements or other
governmental restrictions relating to the environment or to emissions,
discharges or releases of pollutants, contaminants, petroleum or petroleum
products, chemicals or industrial, toxic or hazardous substances or wastes into
the environment including, without limitation, ambient air, surface water,
ground water or land, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
pollutants, contaminants, petroleum or petroleum products, chemicals or
industrial, toxic or hazardous substances or wastes or the clean-up or other
remediation thereof.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended,
or any successor statute.

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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“ERISA Group” means the Company and all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with the Company, are treated as a single
employer under Section 414(b) or 414(c) of the Code.

 

“Event of Default” has the meaning set forth in Section 6.01.

 

“Existing LC Agreement” has the meaning assigned thereto in the above recital of
the parties hereto.

 

“FASB” means the Financial Accounting Standards Board or any entity or body
succeeding to any or all of its functions.

 

“Federal Funds Rate” means, for any day, the rate per annum (rounded upward, if
necessary, to the nearest 1/100th of 1%) equal to the weighted average of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers on such day, as published by
the Federal Reserve Bank of New York on the Business Day next succeeding such
day, provided that (i) if such day is not a Business Day, the Federal Funds Rate
for such day shall be such rate on such transactions on the next preceding
Business Day as so published on the next succeeding Business Day, and (ii) if no
such rate is so published on such next succeeding Business Day (as provided in
clause (i)), the Federal Funds Rate for such day shall be the average rate
quoted to the Person serving as Administrative Agent on such day on such
transactions as determined by the Administrative Agent.

 

“FIN 46” means Interpretation No. 46, “Consolidation of Variable Interest
Entities”, issued by FASB in January 2003.

 

“Guarantee” by any Person means any obligation, contingent or otherwise, of such
Person directly or indirectly guaranteeing any Debt of any other Person and,
without limiting the generality of the foregoing, any obligation, direct or
indirect, contingent or otherwise, of such Person (i) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Debt (whether
arising by virtue of partnership arrangements, by agreement to keep-well, to
purchase assets, goods, securities or services, to take-or-pay, or to maintain
financial statement conditions or otherwise) or (ii) entered into for the
purpose of assuring in any other manner the obligee of such Debt of the payment
thereof or to protect such obligee against loss in respect thereof (in whole or
in part), provided that the term “Guarantee” shall not include endorsements for
collection or deposit in the ordinary course of business. The term “Guarantee”
used as a verb has a corresponding meaning.

 

“Guarantor” means the Company in its capacity as guarantor of the obligations of
each other Account Party pursuant to the provisions of Article IX.

 

“Hybrid Security Amount” means, at any date, an amount equal to 50% of the
aggregate stated redemption price of the Redeemable Preferred Securities of the
Company outstanding on such date.

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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“Index Debt” means senior, unsecured, long-term indebtedness for borrowed money
of the Company that is not guaranteed by any other Person or subject to any
other credit enhancement.

 

“Insurance Subsidiary” means any Restricted Subsidiary which is subject to the
regulation of, and is required to file statements with, any governmental body,
agency or official in any State or territory of the United States or the
District of Columbia which regulates insurance companies or the doing of an
insurance business therein.

 

“Investment” means any investment in any Person, whether by means of share
purchase, capital contribution, loan, time deposit or otherwise.

 

“JPMCB” means JPMorgan Chase Bank.

 

“LC Disbursement” means a payment made by a Bank pursuant to a Letter of Credit.

 

“LC Exposure” means, with respect to any Bank, the Committed LC Exposure and the
Alternative Currency LC Exposure (if any) of such Bank.

 

“Letter of Credit” means any of the Committed Letters of Credit and Alternative
Currency Letters of Credit, and “Letters of Credit” means all of the foregoing.

 

“Lien” means, with respect to any asset, any mortgage, lien, pledge, charge,
security interest or encumbrance of any kind in respect of such asset. For the
purposes of this Agreement, the Company or any Subsidiary shall be deemed to own
subject to a Lien any asset which it has acquired or beneficially holds subject
to the interest of a vendor or lessor under any conditional sale agreement,
capital lease or other title retention agreement relating to such asset.

 

“Material Plan” means at any time a Plan or Plans having aggregate Unfunded
Liabilities in excess of $25,000,000.

 

“Moody’s” means Moody’s Investors Service, Inc.

 

“Multiemployer Plan” means at any time an employee pension benefit plan within
the meaning of Section 4001(a)(3) of ERISA to which any member of the ERISA
Group is then making or accruing an obligation to make contributions or has
within the preceding five plan years made contributions, including for these
purposes any Person which ceased to be a member of the ERISA Group during such
five-year period.

 

“NAIC” means the National Association of Insurance Commissioners and any
successor thereto.

 

“NAIC Approved Bank” means (a) any Bank that is a bank listed on the most
current Bank List (the “NAIC Bank List”) of banks determined by the Securities
Valuation Office of the NAIC and approved by the NAIC or (b) any Bank as to
which its Confirming Bank is a bank listed on the NAIC Bank List.

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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“Newly Acquired Subsidiary” means any Subsidiary that is not a Subsidiary on the
date hereof but that becomes a Subsidiary after the date hereof, but only during
the 180 days after the first date on which such Subsidiary became a Subsidiary.

 

“Parent” means, with respect to any Bank, any Person controlling such Bank.

 

“Participant” has the meaning set forth in Section 10.06(b).

 

“Payment Account” means an account designated by the Administrative Agent in a
notice to the Account Parties and the Banks to which payments hereunder are to
be made.

 

“PBGC” means the Pension Benefit Guaranty Corporation or any entity succeeding
to any or all of its functions under ERISA.

 

“Person” means an individual, a corporation, a partnership, an association, a
trust or any other entity or organization, including a government or political
subdivision or an agency or instrumentality thereof.

 

“Plan” means at any time an employee pension benefit plan (other than a
Multiemployer Plan) which is covered by Title IV of ERISA or subject to the
minimum funding standards under Section 412 of the Code and either (i) is
maintained, or contributed to, by any member of the ERISA Group for employees of
any member of the ERISA Group or (ii) has at any time within the preceding five
years been maintained, or contributed to, by any Person which was at such time a
member of the ERISA Group for employees of any Person which was at such time a
member of the ERISA Group.

 

“Prime Rate” means the rate of interest publicly announced from time to time by
JPMCB as its prime rate as in effect at its principal office in New York City;
each change in the Prime Rate shall be effective from and including the date
such change is publicly announced as being effective.

 

“Quarterly Dates” means the last day of March, June, September and December in
each year, the first of which shall be the first such day after the date hereof.

 

“Ratings Event” has the meaning set forth in Section 5.08.

 

“Redeemable Preferred Securities” means the securities described on the balance
sheet contained in the Company’s 2002 Form 10-K as “Company-obligated
mandatorily redeemable preferred securities of subsidiary trusts holding solely
junior subordinated debentures” and all equivalent securities, however
described.

 

“Regulations T, U and X” means Regulations T, U and X, respectively, of the
Board of Governors of the Federal Reserve System, in each case as in effect from
time to time.

 

“Related Parties” means, with respect to any specified Person, such Person’s
Affiliates and the respective directors, officers, employees, agents and
advisors of such Person and such Person’s Affiliates.

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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“Required Banks” means at any time Banks (a) having more than 50% of the
aggregate amount of the Commitments or (b) if the Commitments shall have been
terminated, holding more than 50% of the aggregate LC Exposure of the Banks at
such time.

 

“Restricted Subsidiary” means, as of any date, a Subsidiary which meets the
definitional requirements of a “significant subsidiary”, as such term is defined
in the rules set forth in Regulation S-X under the Securities Exchange Act of
1934, as amended (applying the tests set forth in such rules with reference to
the consolidated balance sheets and related consolidated statements of income of
the Company and its Consolidated Subsidiaries as of the last day of its most
recently completed fiscal quarter and for the twelve-month period then ended).

 

“S&P” means Standard and Poor’s Ratings Services.

 

“Secured Obligations” has the meaning set forth in Section 2.03(e).

 

“Subsidiary” means any corporation or other entity of which securities or other
ownership interests having ordinary voting power to elect a majority of the
board of directors or other persons performing similar functions are at the time
directly or indirectly owned by the Company.

 

“Subsidiary Account Parties” means each Subsidiary of the Company that is listed
on the signature pages hereof under the caption “SUBSIDIARY ACCOUNT PARTIES” and
each other Subsidiary of the Company that shall become a Subsidiary Account
Party pursuant to Section 10.13, so long as such Subsidiary shall remain a
Subsidiary Account Party hereunder.

 

“Supplemental Bank” has the meaning set forth in Section 2.04(e).

 

“Supplemental Commitment Date” has the meaning set forth in Section 2.04(e).

 

“Unfunded Liabilities” means, with respect to any Plan at any time, the amount
(if any) by which (i) the present value of all benefits under such Plan exceeds
(ii) the fair market value of all Plan assets allocable to such benefits
(excluding any accrued but unpaid contributions), all determined as of the then
most recent valuation date for such Plan, but only to the extent that such
excess represents a potential liability of a member of the ERISA Group to the
PBGC or any other Person under Title IV of ERISA.

 

SECTION 1.02. Accounting Terms and Determinations. Unless otherwise specified
herein, all accounting terms used herein shall be interpreted, all accounting
determinations hereunder shall be made and all financial statements required to
be delivered hereunder shall be prepared in accordance with generally accepted
accounting principles as in effect from time to time, applied on a basis
consistent (except for changes concurred in by the Company’s independent public
accountants) with the most recent audited consolidated financial statements of
the Company and its Consolidated Subsidiaries delivered to the Banks; provided
that if the Company notifies the Administrative Agent that the Company wishes to
amend any covenant in Article V to eliminate the effect of any change in
generally accepted accounting principles on the operation of such covenant (or
if the Administrative Agent notifies the

 

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Company that the Required Banks wish to amend Article V for such purpose), then
the Company’s compliance with such covenant shall be determined on the basis of
generally accepted accounting principles in effect immediately before the
relevant change in generally accepted accounting principles became effective,
until either such notice is withdrawn or such covenant is amended in a manner
satisfactory to the Company and the Required Banks.

 

ARTICLE II

 

THE CREDITS

 

SECTION 2.01. The Commitments.

 

(a) General. Subject to the terms and conditions set forth herein, at the
request of any Account Party the Banks agree at any time and from time to time
during the Commitment Availability Period to issue Committed Letters of Credit
for account of such Account Party in an aggregate amount that will not result in
the aggregate LC Exposures exceeding the Commitments. Each Committed Letter of
Credit shall be a standby letter of credit in such form as the relevant Account
Party shall request and which (i) the Administrative Agent shall determine in
good faith does not contain any obligations, or diminish any rights, of any Bank
with respect thereto that are inconsistent with the terms hereof or (ii) the
Required Banks shall approve; provided that, without the prior consent of each
Bank, no Committed Letter of Credit may be issued that would vary the several
and not joint nature of the obligations of the Banks thereunder as provided in
the next succeeding sentence. Each Committed Letter of Credit shall be issued by
all of the Banks having Commitments at the time of issuance as a single
multi-bank letter of credit, but the obligation of each Bank thereunder shall be
several and not joint, based upon its Applicable Percentage and the aggregate
undrawn amount of such Committed Letter of Credit.

 

(b) Notice of Issuance, Amendment, Renewal or Extension. To request the issuance
of a Committed Letter of Credit (or the amendment, renewal or extension of an
outstanding Committed Letter of Credit), an Account Party shall hand deliver or
telecopy (or transmit by electronic communication, if arrangements for doing so
have been approved by the Administrative Agent) to the Administrative Agent (if
by hand delivery or telecopy, not later than noon (New York City time) on the
Business Day prior to, and if by approved electronic communication, not later
than 10:00 a.m. (New York City time) on the date of, the requested date of
issuance, amendment, renewal or extension) a notice requesting the issuance of a
Committed Letter of Credit, or identifying the Committed Letter of Credit to be
amended, renewed or extended, and specifying the date of issuance, amendment,
renewal or extension, as the case may be (which shall be a Business Day), the
date on which such Committed Letter of Credit is to expire (which shall comply
with Section 2.01(d)), the amount of such Committed Letter of Credit, the name
and address of the beneficiary thereof and the terms and conditions of (and such
other information as shall be necessary to prepare, amend, renew or extend, as
the case may be) such Committed Letter of Credit. If any Committed Letter of
Credit shall provide for the automatic extension of the expiry date thereof
unless the Administrative Agent gives notice that such expiry date shall not be
extended, then the Administrative Agent will give such notice if requested to do
so in a notice given to the Administrative Agent, not more than 60 days, and

 

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not less than 45 days, prior to the current expiry date of such Committed Letter
of Credit, by (i) Required Banks or (ii) the applicable Account Party or the
Company, provided that upon or at any time following the Commitment Termination
Date any Bank may request the Administrative Agent to seek instructions from the
Required Banks as to whether the then existing Committed Letters of Credit
should be non-renewed pursuant to the terms thereof, in which case the
Administrative Agent promptly shall do so and, upon receiving instructions of
the Required Banks with respect thereto, shall act in accordance therewith. If
requested by the Administrative Agent, such Account Party also shall submit a
letter of credit application on standard form of the Person that is serving as
Administrative Agent in connection with any request for a Committed Letter of
Credit. In the event of any inconsistency between the terms and conditions of
this Agreement and the terms and conditions of any form of letter of credit
application or other agreement submitted by any Account Party to, or entered
into by any Account Party with, the Person that is serving as Administrative
Agent relating to any Committed Letter of Credit, the terms and conditions of
this Agreement shall control.

 

(c) Limitations on Amounts and Daily Transactions. Each Committed Letter of
Credit shall be issued, amended, renewed or extended if and only if (and upon
such issuance, amendment, renewal or extension of each Committed Letter of
Credit the Account Parties shall be deemed to represent and warrant that), after
giving effect to such issuance, amendment, renewal or extension, (A) the
aggregate LC Exposure of the Banks shall not exceed the aggregate amount of the
Commitments and (B) the Committed LC Exposure of each Bank shall not exceed the
Commitment of such Bank. In no event may more than 25 issuances, amendments,
renewals and/or extensions of Committed Letters of Credit occur on any day,
unless the Administrative Agent shall otherwise agree.

 

(d) Expiry Date. Each Committed Letter of Credit shall expire at or prior to the
close of business on the earlier of (i) the date one year after the date of the
issuance of such Letter of Credit or (ii) the date five Business Days prior to
the Commitment Termination Date; provided that such Committed Letter of Credit
may contain “evergreen” provisions for the renewal or extension thereof to a
date one year after the then current expiry date thereof.

 

(e) Obligation of Banks. The obligation of any Bank under any Committed Letter
of Credit shall be several and not joint and shall at any time be in an amount
equal to such Bank’s Applicable Percentage of the aggregate undrawn amount of
such Committed Letter of Credit, and each Committed Letter of Credit shall
expressly so provide.

 

(f) Adjustment of Applicable Percentages. Upon the occurrence of any of the
following events: (i) the addition of a Supplemental Bank or increase in the
amount of the Commitment of a Bank pursuant to Section 2.04(e) or (ii) the
assignment of Commitment and interest in outstanding Committed Letters of Credit
pursuant to Section 10.06, then the Administrative Agent shall promptly notify
each beneficiary under an outstanding Committed Letter of Credit of the Banks
that are parties to such Committed Letter of Credit, after giving effect to such
event, and their respective Applicable Percentages as of the effective date of
such event.

 

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(g) Replacement of Banks. If any Bank defaults in its obligation to fund any LC
Disbursement hereunder, or if any Bank ceases at any time to be an NAIC Approved
Bank, then the Company may, at its sole expense and effort, upon notice to such
Bank and the Administrative Agent, require such Bank to assign and delegate,
without recourse (in accordance with and subject to the restrictions contained
in Section 10.06), all its interests, rights and obligations under this
Agreement and the Committed Letters of Credit and the Alternative Currency
Letters of Credit issued by such Bank to an assignee that shall assume such
obligations (which assignee may be another Bank, if it accepts such assignment);
provided that (i) the Company shall have received the prior written consent of
the Administrative Agent, which consent shall not unreasonably be withheld and
(ii) such Bank shall have received payment of an amount equal to the outstanding
amount of its LC Disbursements, accrued interest thereon, accrued fees and all
other amounts payable to it hereunder, from the assignee (to the extent of such
outstanding LC Disbursements and accrued interest and fees) or the applicable
Account Parties (in the case of all other amounts). A Bank shall not be required
to make any such assignment and delegation if, prior thereto the circumstances
entitling the Account Parties to require such assignment and delegation cease to
apply.

 

(h) Existing Letters of Credit. Upon the occurrence of the Effective Date, each
of the Committed Letters of Credit and Alternative Currency Letters of Credit
outstanding on the Effective Date under the Existing LC Agreement shall be
automatically continued as a Committed Letter of Credit or Alternative Currency
Letter of Credit, respectively, under this Agreement; provided that the
Administrative Agent shall promptly notify each beneficiary of a Committed
Letter of Credit that is outstanding under the Existing LC Agreement and
continued hereunder of (i) the Banks that as of the Effective Date are parties
thereto and (ii) such Banks’ respective Applicable Percentages with respect
thereto.

 

SECTION 2.02. Issuance and Administration of Committed Letters of Credit. Each
Committed Letter of Credit shall be executed and delivered by the Administrative
Agent in the name and on behalf of, and as attorney-in-fact for, the Banks party
to such Committed Letter of Credit, and the Administrative Agent shall act under
each Committed Letter of Credit, and each Committed Letter of Credit shall
expressly provide that the Administrative Agent shall act as the agent of each
such Bank to (a) receive drafts, other demands for payment and other documents
presented by the beneficiary under such Committed Letter of Credit, (b)
determine whether such drafts, demands and documents are in compliance with the
terms and conditions of such Committed Letter of Credit and (c) to notify such
Bank, the Company and the applicable Account Party that a valid drawing has been
made and the date that the related LC Disbursement is to be made; provided that
the Administrative Agent shall have no obligation or liability for any LC
Disbursement under such Committed Letter of Credit, and each Committed Letter of
Credit shall expressly so provide. Each Bank hereby irrevocably appoints and
designates the Administrative Agent as its attorney-in-fact, acting through any
duly authorized officer of the Person that is serving as the Administrative
Agent, to execute and deliver in the name and on behalf of such Bank each
Committed Letter of Credit to be issued by the Banks hereunder. Promptly upon
the request of the Administrative Agent, each Bank will furnish to the
Administrative Agent such powers of attorney or other evidence as any
beneficiary of any Committed Letter of Credit may reasonably request in order to
demonstrate that the Administrative Agent has the power to act as
attorney-in-fact for such Bank to execute and

 

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deliver such Committed Letter of Credit. The Administrative Agent has no
responsibility hereunder with respect to the issuance, renewal, extension,
amendment or other administration of any Alternative Currency Letters of Credit,
except as expressly set forth in Section 2.07.

 

SECTION 2.03. Reimbursement for LC Disbursements, Cover, Etc.

 

(a) Reimbursement. If any Bank shall make any LC Disbursement in respect of any
Letter of Credit, the Account Party with respect to such Letter of Credit shall
reimburse such Bank in respect of any such LC Disbursement (i) under a Committed
Letter of Credit, by paying to the Administrative Agent an amount equal to such
LC Disbursement not later than noon, New York City time, on (A) the Business Day
that the Company and such Account Party receive notice of such LC Disbursement,
if such notice is received prior to 10:00 a.m., New York City time, or (B) the
Business Day immediately following the day that the Company and such Account
Party receive such notice, if such notice is received on a day which is not a
Business Day or is not received prior to 10:00 a.m., New York City time, on a
Business Day and (ii) under an Alternative Currency Letter of Credit, by paying
such Bank on the date, in the currency and amount thereof, together with
interest thereon (if any), and in the manner as such Bank and such Account Party
shall have separately agreed pursuant to Section 2.07.

 

(b) Reimbursement Obligations Absolute. The Account Parties’ obligations to
reimburse LC Disbursements as provided in Section 2.03(a) shall be absolute,
unconditional and irrevocable, and shall be performed strictly in accordance
with the terms of this Agreement under any and all circumstances whatsoever and
irrespective of (i) any lack of validity or enforceability of any Letter of
Credit, or any term or provision therein, (ii) any draft or other document
presented under a Letter of Credit proving to be forged, fraudulent or invalid
in any respect or any statement therein being untrue or inaccurate in any
respect, (iii) payment under a Letter of Credit against presentation of a draft
or other document that does not comply strictly with the terms of such Letter of
Credit, (iv) at any time or from time to time, without notice to any Account
Party, the time for any performance of or compliance with any of such
reimbursement obligations of any other Account Party shall be waived, extended
or renewed, (v) any of such reimbursement obligations of any other Account Party
shall be amended or otherwise modified in any respect, or the Guarantee of any
of such reimbursement obligations or any security therefor shall be released,
substituted or exchanged in whole or in part or otherwise dealt with, (vi) any
lien or security interest granted to, or in favor of, the Administrative Agent
or any of the Banks as security for any of such reimbursement obligations shall
fail to be perfected, (vii) the occurrence of any Default, (viii) the existence
of any proceedings of the type described in Section 6.01(g) or (h) with respect
to any other Account Party or the Guarantor of any of such reimbursement
obligations, (ix) any lack of validity or enforceability of any of such
reimbursement obligations against any other Account Party or the Guarantor of
any of such reimbursement obligations, or (x) any other event or circumstance
whatsoever, whether or not similar to any of the foregoing, that might, but for
the provisions of this Section 2.03, constitute a legal or equitable discharge
of the obligations of any Account Party hereunder.

 

Neither the Administrative Agent, nor any Bank nor any of their Related Parties
shall have any liability or responsibility by reason of or in connection with
the issuance or transfer of any Letter of Credit or any payment or failure to
make any payment thereunder

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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(irrespective of any of the circumstances referred to in the preceding
sentence), or any error, omission, interruption, loss or delay in transmission
or delivery of any draft, notice or other communication under or relating to any
Letter of Credit (including any document required to make a drawing thereunder),
any error in interpretation of technical terms or any consequence arising from
causes beyond their control; provided that the foregoing shall not be construed
to excuse the Administrative Agent or a Bank from liability to any Account Party
to the extent of any direct damages (as opposed to consequential damages, claims
in respect of which are hereby waived by the Account Parties to the extent
permitted by applicable law) suffered by any Account Party that are caused by
(x) the gross negligence or willful misconduct of the Administrative Agent or
such Bank, as the case may be, or (y) in the case of any Bank, its failure to
make an LC Disbursement in respect of any drawing properly made under a Letter
of Credit as provided in Section 2.03(c). The parties hereto expressly agree
that:

 

(i) the Administrative Agent may accept documents that appear on their face to
be in substantial compliance with the terms of a Letter of Credit without
responsibility for further investigation, regardless of any notice or
information to the contrary, and may make payment upon presentation of documents
that appear on their face to be in substantial compliance with the terms of such
Letter of Credit;

 

(ii) the Administrative Agent shall have the right, in its sole discretion, to
decline to accept such documents and to make such payment if such documents are
not in strict compliance with the terms of such Letter of Credit; and

 

(iii) this sentence shall establish the standard of care to be exercised by the
Administrative Agent when determining whether drafts and other documents
presented under a Letter of Credit comply with the terms thereof (and the
parties hereto hereby waive, to the extent permitted by applicable law, any
standard of care inconsistent with the foregoing).

 

(c) Disbursement Procedures. The Administrative Agent shall, within a reasonable
time following its receipt thereof, examine all documents purporting to
represent a demand for payment under any Letter of Credit. The Administrative
Agent shall promptly after such examination (i) notify each of the Banks, the
Company and the Account Party by telephone (confirmed by telecopy) of such
demand for payment and (ii) deliver to each Bank a copy of each document
purporting to represent a demand for payment under such Letter of Credit. With
respect to any drawing properly made under a Letter of Credit, each Bank will
make an LC Disbursement in respect of such Letter of Credit in accordance with
its liability under such Letter of Credit and this Agreement, such LC
Disbursement to be made to the account of the Administrative Agent most recently
designated by it for such purpose by notice to the Banks. The Administrative
Agent will make any such LC Disbursement available to the beneficiary of such
Letter of Credit by promptly crediting the amounts so received, in like funds,
to the account identified by such beneficiary in connection with such demand for
payment. Promptly following any LC Disbursement by any Bank in respect of any
Letter of Credit, the Administrative Agent will notify the Company and the
applicable Account Party of such LC Disbursement; provided that any failure to
give or delay in giving such notice shall not relieve such Account Party of its

 

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obligation to reimburse the Banks with respect to any such LC Disbursement or
the Guarantor of its guarantee of such obligation.

 

(d) Interim Interest. If any LC Disbursement is made, then, unless the Account
Parties shall reimburse such LC Disbursement in full on the date such LC
Disbursement is made (without regard for when notice thereof is given), the
unpaid amount thereof shall bear interest, for each day from and including the
date such LC Disbursement is made to but excluding the date that the applicable
Account Party reimburses such LC Disbursement, at the rate per annum equal to
(i) 1% plus the Base Rate to but excluding the date three Business Days after
such LC Disbursement and (ii) from and including the date three Business Days
after such LC Disbursement, 3% plus the Base Rate.

 

(e) Provision of Cover. In the event the Company and the Account Parties shall
have provided cover for outstanding Committed Letters of Credit pursuant to
Section 6.01, the Administrative Agent will establish a separate cash collateral
account (the “Collateral Account”), which may be a “securities account” (as
defined in Section 8-501 of the Uniform Commercial Code as in effect in New York
(the “NY UCC”)), in the name and under the sole dominion and control of the
Administrative Agent (and, in the case of a securities account, in respect of
which the Administrative Agent is the “entitlement holder” (as defined in
Section 8-102(a)(7) of the NY UCC)) into which there shall be deposited from
time to time such amounts paid to the Administrative Agent as cover for such LC
Exposure. As collateral security for the prompt payment in full when due of all
reimbursement obligations in respect of LC Disbursements, all interest thereon,
and all other obligations of the Account Parties under the Credit Documents
(other than reimbursement obligations, interest thereon and fees in respect of
Alternative Currency Letters of Credit) whether or not then outstanding or due
and payable (such obligations being herein collectively called the “Secured
Obligations”), each of the Company and the other Account Parties hereby pledges
and grants to the Administrative Agent, for the benefit of the Banks and the
Administrative Agent as provided herein, a security interest in all of its
right, title and interest in and to the Collateral Account and the balances from
time to time in the Collateral Account (including the investments and
reinvestments therein provided for below). The balances from time to time in the
Collateral Account shall not constitute payment of any Secured Obligations until
applied by the Administrative Agent as provided herein. Anything in this
Agreement to the contrary notwithstanding, funds held in the Collateral Account
shall be subject to withdrawal only as provided in this Section 2.03(e). Amounts
on deposit in the Collateral Account shall be invested and reinvested by the
Administrative Agent in such short-term Investments as the Administrative Agent
shall determine in its sole discretion. All such investments and reinvestments
shall be held in the name and be under the sole dominion control of the
Administrative Agent and shall be credited to the Collateral Account. At any
time, and from time to time, while an Event of Default has occurred and is
continuing or at any time following the Commitment Termination Date, the
Administrative Agent shall, if instructed by the Required Banks in their sole
discretion, liquidate any such investments and reinvestments and credit the
proceeds thereof to the Collateral Account and apply or cause to be applied such
proceeds and any other balances in the Collateral Account to the payment of any
of the Secured Obligations due and payable. At any time prior to the Commitment
Termination Date, if (i) no Default has occurred and is continuing and (ii) all
of the Secured Obligations then due have been paid in full but Committed Letters
of Credit remain outstanding, the Administrative Agent shall,

 

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from time to time, at the request of the Company, deliver to the Company,
against receipt but without any recourse, warranty or representation whatsoever,
such of the balances in the Collateral Account as exceed the aggregate undrawn
face amount of all outstanding Committed Letters of Credit. When all of the
Secured Obligations shall have been paid in full and all Committed Letters of
Credit have expired or been terminated, the Administrative Agent shall promptly
deliver to the Company, for account of the Company and the other Account
Parties, as applicable, against receipt but without any recourse, warranty or
representation whatsoever, the balances remaining in the Collateral Account.

 

SECTION 2.04. Termination, Reduction and Increase of the Commitments.

 

(a) Unless previously terminated, the Commitments shall automatically terminate
on the Commitment Termination Date.

 

(b) The Company may at any time terminate, or from time to time reduce, the
Commitments; provided that (i) each reduction of the Commitments shall be in an
amount that is $10,000,000 or a larger multiple of $5,000,000 and (ii) the
Company shall not terminate or reduce the Commitments if the aggregate LC
Exposures would exceed the Commitments.

 

(c) The Company shall notify the Administrative Agent of any election to
terminate or reduce the Commitments under Section 2.04(b) at least three
Business Days prior to the effective date of such termination or reduction,
specifying such election and the effective date thereof. Promptly following
receipt of any notice, the Administrative Agent shall advise the Banks of the
contents thereof. Each notice delivered by the Company pursuant to this Section
2.04 shall be irrevocable.

 

(d) Any termination or reduction of the Commitments shall be permanent. Each
reduction of the Commitments shall be made ratably among the Banks in accordance
with their respective Commitments.

 

(e) The Company shall have the right at any time prior to the date that is 30
days prior to the Commitment Termination Date to increase the aggregate
Commitments hereunder up to an aggregate amount not exceeding $800,000,000 by
adding to this Agreement one or more other NAIC Approved Banks (which may
include any existing Bank, with the consent of such Bank in it sole discretion)
(each such bank, a “Supplemental Bank”)) with the approval of the Administrative
Agent (which approval shall not be unreasonably withheld), provided that (i)
each Supplemental Bank shall have entered into an agreement in form and
substance satisfactory to the Company and the Administrative Agent pursuant to
which such Supplemental Bank shall undertake a Commitment (or, if such
Supplemental Bank is an existing Bank, pursuant to which its Commitment shall be
in increased), (ii) such Commitment of any Supplemental Bank that is not an
existing Bank shall be in an amount of at least $25,000,000 and (iii) such
Commitment (together with the increased Commitment(s) of all other Supplemental
Banks being provided at such time shall be in an amount of at least $25,000,000.
Each such Supplemental Bank shall enter into an agreement in form and substance
satisfactory to the Company and the Administrative Agent pursuant to which such
Supplemental Bank shall, effective as of the date of effectiveness thereof
(which shall be a Business Day and, unless the

 

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Administrative Agent otherwise agrees, on which no issuance, amendment, renewal
or extension of any Committed Letter of Credit is scheduled to occur, each a
“Supplemental Commitment Date”), undertake a Commitment (or, if any such
Supplemental Bank is an existing Bank, its Commitment shall be in addition to
such Bank’s Commitment hereunder on such date) and such Supplemental Bank shall
thereupon become (or continue to be) a “Bank” for all purposes hereof.
Notwithstanding the foregoing, no increase in the aggregate Commitments
hereunder pursuant to this Section shall be effective unless:

 

(i) the Company shall have given the Administrative Agent notice of any such
increase at least three Business Days prior to the relevant Supplemental
Commitment Date;

 

(ii) no Default shall have occurred and be continuing on the applicable
Supplemental Commitment Date; and

 

(iii) each of the representations and warranties each Account Party contained in
this Agreement (other than the representations and warranties set forth in
Sections 4.04(e) and 4.05 as to any matter which has theretofore been disclosed
in writing by the Account Parties to the Banks) shall be true on and as of the
applicable Supplemental Commitment Date with the same force and effect as if
made on and as of such date (or, if any such representation or warranty is
expressly stated to have been made as of a specific date, as of such specific
date).

 

Each notice under clause (i) above shall be deemed to constitute a
representation and warranty by the Company and the Subsidiary Account Parties as
to the matters specified in clauses (ii) and (iii) above.

 

SECTION 2.05. Fees.

 

(a) The Company agrees to pay to the Administrative Agent for account of each
Bank a commitment fee, which shall accrue at the Applicable Rate on the average
daily unutilized amount of the Commitment of such Bank (provided that the
issuance, renewal or extension of Alternative Currency Letters of Credit shall
not be a utilization of any Bank’s Commitment for purposes of this Section),
during the period from and including the Effective Date to but excluding the
date that the Commitments terminate. Commitment fees accrued through and
including each Quarterly Date shall be payable on the third Business Day
following such Quarterly Date and on the date the Commitments terminate,
commencing on the first such Business Day to occur. Commitment fees shall be
computed on the basis of a year of 360 days and shall be payable for the actual
number of days elapsed (including the first day but excluding the last day).

 

(b) The Company agrees to pay to the Administrative Agent for account of each
Bank a letter of credit fee with respect to Committed Letters of Credit, which
shall accrue at the Applicable Rate on the average daily aggregate undrawn
amount of all outstanding Committed Letters of Credit during the period from and
including the Effective Date to but excluding the later of the date on which
such Bank’s Commitment terminates and the date on which such Bank ceases to have
any Committed LC Exposure. Letter of credit fees accrued

 

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through and including each Quarterly Date shall be payable on the third Business
Day following such Quarterly Date, commencing on the first such Business Day to
occur; provided that all such fees shall be payable on the date on which the
Commitments terminate and any such fees accruing after the date on which the
Commitments terminate shall be payable on demand. Letter of credit fees shall be
computed on the basis of a year of 360 days and shall be payable for the actual
number of days elapsed (including the first day but excluding the last day).

 

(c) The Account Parties agree to pay, on demand, to the Administrative Agent for
its own account all commissions, charges, costs and expenses with respect to the
issuance, amendment, renewal and extension of each Committed Letter of Credit
and drawings and other transactions relating thereto in amounts customarily
charged from time to time in like circumstances by the Person that is serving as
the Administrative Agent or, as may be separately agreed from time to time by
the Company on behalf of the Account Parties and the Administrative Agent for
its own account.

 

(d) All fees payable hereunder shall be paid on the dates due, in immediately
available funds, to the Administrative Agent for distribution, in the case of
commitment fees and letter of credit fees, to the Banks entitled thereto. Fees
paid hereunder shall not be refundable under any circumstances.

 

SECTION 2.06. Payments Generally; Pro Rata Treatment.

 

(a) Each Account Party shall make each payment required to be made by it
hereunder (whether reimbursement of LC Disbursements, interest or fees or under
Article VIII, or otherwise) or under any other Credit Document (except to the
extent otherwise provided therein) prior to not later than 1:00 p.m., New York
City time, on the date when due, in immediately available funds, without set-off
or counterclaim. Any amounts received after such time on any date may, in the
discretion of the Administrative Agent, be deemed to have been received on the
next succeeding Business Day for purposes of calculating interest thereon. All
such payments shall be made to the Administrative Agent at its Payment Account,
except as otherwise expressly provided in the relevant Credit Document, and
except that payments pursuant to Sections 2.07 and 10.03 and Article VIII shall
be made directly to the Persons entitled thereto. The Administrative Agent shall
distribute any such payments received by it for account of any other Person to
the appropriate recipient promptly following receipt thereof. If any payment
hereunder shall be due on a day that is not a Business Day, the date for payment
shall be extended to the next succeeding Business Day and, in the case of any
payment accruing interest, interest thereon shall be payable for the period of
such extension. All payments hereunder or under any other Credit Document
(except to the extent otherwise provided herein or therein with respect to
Alternative Currency Letters of Credit) shall be made in Dollars.

 

(b) If at any time insufficient funds are received by and available to the
Administrative Agent to pay fully all amounts of unreimbursed LC Disbursements
in respect of Committed Letters of Credit, interest and fees then due hereunder,
such funds shall be applied (i) first, to pay interest and fees then due
hereunder, ratably among the parties entitled thereto in accordance with the
amounts of interest and fees then due to such parties, and (ii) second, to pay
such unreimbursed LC Disbursements then due hereunder, ratably among the parties
entitled

 

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thereto in accordance with the amounts of unreimbursed LC Disbursements then due
to such parties.

 

(c) Except to the extent otherwise provided herein: (i) each reimbursement of LC
Disbursements in respect of Committed Letters of Credit and each payment of
commitment fee under Section 2.05(a) shall be for account of the Banks, and each
termination or reduction of the amount of the Commitments under Section 2.04
shall be applied to the respective Commitments of the Banks, pro rata according
to the amounts of their respective Commitments; (ii) each payment of letter of
credit fee under Section 2.05(b) shall be for account of the Banks, pro rata
according to the amounts of their respective Applicable Percentages under the
Committed Letters of Credit; (iii) each reimbursement of LC Disbursements under
any Alternative Currency Letter of Credit by the Account Parties shall be made
for account of the Banks party to such Alternative Currency Letter of Credit pro
rata in accordance with the respective unreimbursed LC Disbursements owing to
them; and (iv) each payment of interest shall be made for account of the Banks
pro rata in accordance with the amounts of interest then due and payable to the
respective Banks.

 

(d) Unless the Administrative Agent shall have received notice from the Company
or the applicable Account Party prior to the date on which any payment is due to
the Administrative Agent for account of the Banks hereunder that neither the
Company nor such Account Party will make such payment, the Administrative Agent
may assume that the Company or such Account Party made such payment on such date
in accordance herewith and may, in reliance upon such assumption, distribute to
the Banks the amount due. In such event, if the Company or such Account Party
has not in fact made such payment, then each of the Banks severally agrees to
repay to the Administrative Agent forthwith on demand the amount so distributed
to such Bank with interest thereon, for each day from and including the date
such amount is distributed to it to but excluding the date of payment to the
Administrative Agent, at the Federal Funds Rate.

 

SECTION 2.07. Alternative Currency Letters of Credit.

 

(a) Requests for Offers. From time to time during the Commitment Availability
Period an Account Party may request any or all of the Banks to make offers to
issue an Alternative Currency Letter of Credit for account of such Account
Party. Each Bank may, but shall have no obligation to, make such offers on terms
and conditions that are satisfactory to such Bank, and such Account Party may,
but shall have no obligation to, accept any such offers. The issuance of each
Alternative Currency Letter of Credit shall be subject to the conditions of
Section 3.01 and to such other conditions as are agreed upon by such Account
Party and the Bank issuing such Alternative Currency Letter of Credit, and the
issuance of any Alternative Currency Letter of Credit shall be deemed to be a
representation and warranty by such Account Party on the date thereof as to the
facts specified in Section 3.01(b), Section 3.01(c) and Section 3.01(d). Each
such Alternative Currency Letter of Credit shall be issued, and subsequently,
renewed, extended, amended and confirmed, on such terms as the Company, the
applicable Account Party and such Bank shall agree, including, without
limitation, expiry, drawing conditions, reimbursement, interest, fees and
provision of cover; provided that the expiry of any Alternative Currency Letter
of Credit shall not be later than the close of business

 

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on the earlier of (i) the date one year after the date of the issuance of such
Alternative Currency Letter of Credit or (ii) the date five Business Days prior
to the Commitment Termination Date; provided, further, that such Alternative
Currency Letter of Credit may contain “evergreen” provisions for the renewal or
extension thereof to a date one year after the then current expiry date thereof.

 

(b) Reports to Administrative Agent. The Company shall deliver to the
Administrative Agent and each of the Banks a report in respect of each
Alternative Currency Letter of Credit (an “Alternative Currency Letter of Credit
Report”) on and as of the date on which (i) such Alternative Currency Letter of
Credit is issued, (ii) the issuance, renewal, extension or amendment of a
Committed Letter of Credit, if any Alternative Currency Letter of Credit is then
outstanding and (iii) the Commitments are to be reduced pursuant to Section
2.04, specifying for each such Alternative Currency Letter of Credit (after
giving effect to issuance thereof, as applicable):

 

(A) the date on which such Alternative Currency Letter of Credit was or is being
issued;

 

(B) the Alternative Currency of such Alternative Currency Letter of Credit;

 

(C) the aggregate undrawn amount of such Alternative Currency Letter of Credit
(in such Alternative Currency);

 

(D) the aggregate unpaid amount of LC Disbursements under such Alternative
Currency Letter of Credit (in such Alternative Currency);

 

(E) the Dollar Equivalent of the Alternative Currency LC Exposure in respect of
such Alternative Currency Letter of Credit; and

 

(F) the Dollar Equivalent of the aggregate amount of Alternative Currency LC
Exposures.

 

Each Alternative Currency Letter of Credit Report shall be delivered to the
Administrative Agent and each of the Banks by 10:00 a.m. (New York City time) on
the date on which it is required to be delivered.

 

ARTICLE III

 

CONDITIONS

 

SECTION 3.01. Each Credit Event. The obligation of each Bank to issue, amend,
renew or extend any Letter of Credit is subject to the satisfaction of the
following conditions:

 

(a) in the case of a Committed Letter of Credit, receipt by the Administrative
Agent of a notice of issuance, amendment, renewal or extension, as the case may
be, with respect to such Committed Letter Credit, as required by Section 2.01(b)
and, in the case

 

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of an Alternative Currency Letter of Credit, receipt by the Administrative Agent
of a request for offers as required by Section 2.07(a);

 

(b) the fact that, immediately after such issuance, amendment, renewal or
extension of such Letter Credit, the sum of (i) the aggregate outstanding amount
of Committed LC Exposure plus (ii) the Dollar Equivalent of the aggregate
outstanding amount of Alternative Currency LC Exposure will not exceed the
aggregate amount of the Commitments;

 

(c) the fact that, immediately before and after issuance, amendment, renewal or
extension of such Letter Credit, no Default shall have occurred and be
continuing; and

 

(d) the fact that the representations and warranties of each Account Party
contained in this Agreement (other than the representations and warranties set
forth in Sections 4.04(e) and 4.05 as to any matter which has theretofore been
disclosed in writing by the Account Parties to the Banks) shall be true on and
as of the date of such issuance, amendment, renewal or extension of such Letter
Credit (or, if any such representation or warranty is expressly stated to have
been made as of a specific date, as of such specific date), provided that the
exception in the first parenthetical phrase in this clause shall not apply in
the case of any issuance, amendment, renewal or extension of a Letter of Credit
on the Effective Date or with respect to the certificate under clause (d) of
Section 3.02.

 

Each issuance, amendment, renewal or extension of a Letter Credit hereunder
shall be deemed to be a representation and warranty by the applicable Account
Party on the date of such issuance, amendment, renewal or extension, as the case
may be, as to the facts specified in clauses (b), (c) and (d) of this Section.

 

SECTION 3.02. Effectiveness. This Agreement (and the amendment and restatement
of the Existing LC Agreement provided for hereby) shall become effective on the
first date that all of the following conditions shall have been satisfied (or
waived in accordance with Section 10.05):

 

(a) receipt by the Administrative Agent of counterparts hereof signed by each of
the Persons listed on the signature pages hereto (or, in the case of any Bank as
to which an executed counterpart shall not have been received, receipt by the
Administrative Agent in form satisfactory to it of telegraphic, telex or other
written confirmation from such Bank of execution and delivery of a counterpart
hereof by such Bank);

 

(b) receipt by the Administrative Agent of an opinion of Dennis L. Schoff, Esq.,
General Counsel of the Company, substantially in the form of Exhibit D hereto;

 

(c) receipt by the Administrative Agent of an opinion of Milbank, Tweed, Hadley
& McCloy LLP, special New York counsel to JPMCB, substantially in the form of
Exhibit E hereto;

 

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(d) receipt by the Administrative Agent of a certificate, dated the Effective
Date and signed by a senior financial officer of the Company, certifying as to
clauses (c) and (d) of Section 3.01;

 

(e) receipt by the Administrative Agent of a copy of the resolutions of the
Board of Directors of the Company, in form and substance satisfactory to the
Administrative Agent, authorizing the execution, delivery and performance of
this Agreement;

 

(f) receipt by the Administrative Agent of a certificate of a senior financial
officer of the Company stating that the Company has paid in full all accrued
fees and other amounts payable under the Existing LC Agreement;

 

(g) receipt by the Administrative Agent of all documents, opinions and
instruments as it may reasonably request relating to the existence of each
Account Party, the corporate authority for and the validity and enforceability
of this Agreement, and any other matters related hereto, all in form and
substance satisfactory to the Administrative Agent; and

 

(h) receipt by the Administrative Agent for account of itself, the Banks and the
Lead Arranger listed on the cover page of this Agreement, as the case may be, of
all fees required to be paid, and all expenses required to be paid or reimbursed
for which invoices have been presented (including, without limitation, fees and
disbursements of counsel to JPMCB), on or before the Effective Date;

 

provided that this Agreement shall not become effective or be binding on any
party hereto unless all of the foregoing conditions are satisfied not later than
3:00 p.m. (New York City time) December 11, 2003 or such later date as may be
agreed in writing by the Company and all of the Banks. The Administrative Agent
shall promptly notify the Company and the Banks of the Effective Date, and such
notice shall be conclusive and binding on all parties hereto.

 

ARTICLE IV

 

REPRESENTATIONS AND WARRANTIES

 

Each of the Company (other than with respect to Section 4.15) and the Subsidiary
Account Parties (with respect to Section 4.15 only) represents and warrants
that:

 

SECTION 4.01. Corporate Existence and Power. The Company is a corporation duly
incorporated and validly existing under the laws of the State of Indiana, and
has all corporate power and all material governmental licenses, authorizations,
consents and approvals required to carry on its business as now conducted.

 

SECTION 4.02. Corporate and Governmental Authorization; Contravention. The
execution, delivery and performance by the Company of this Agreement and the
other Credit Documents to which it is a party are within the Company’s corporate
powers, have been duly

 

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authorized by all necessary corporate action, require no action by or in respect
of, or filing with, any governmental body, agency or official and do not
contravene, or constitute a default under, any provision of applicable law or
regulation or of the articles of incorporation or by-laws of the Company or of
any material agreement, judgment, injunction, order, decree or other instrument
binding upon the Company or any of its Restricted Subsidiaries or result in the
creation or imposition of any Lien on any asset of the Company or any of its
Restricted Subsidiaries.

 

SECTION 4.03. Binding Effect. This Agreement and the other Credit Documents to
which it is a party constitute the legal, valid and binding obligations of the
Company, in each case enforceable in accordance with their respective terms,
except as the same may be limited by bankruptcy, insolvency or similar laws
affecting creditors’ rights generally and by general principles of equity.

 

SECTION 4.04. Financial Information.

 

(a) The consolidated balance sheets of the Company and its Consolidated
Subsidiaries as of December 31, 2002 and the related consolidated statements of
income, cash flows and shareholders’ equity for the fiscal year then ended,
reported on by Ernst & Young LLP and set forth in the Company’s 2002 Form 10-K,
a copy of which has been delivered to the Administrative Agent on behalf of each
of the Banks, fairly present, in conformity with generally accepted accounting
principles, the consolidated financial position of the Company and its
Consolidated Subsidiaries as of such date and their consolidated results of
operations and changes in financial position for such fiscal year.

 

(b) The unaudited consolidated balance sheets of the Company and its
Consolidated Subsidiaries as of September 30, 2003 and the related unaudited
consolidated statements of income, cash flows and shareholders’ equity for the
nine months then ended, set forth in the Company’s quarterly report for the
fiscal quarter ended September 30, 2003 as filed with the Securities and
Exchange Commission on Form l0-Q, a copy of which has been delivered to the
Administrative Agent on behalf of each of the Banks, fairly present, in
conformity with generally accepted accounting principles applied on a basis
consistent with the financial statements referred to in subsection (a) of this
Section, the consolidated financial position of the Company and its Consolidated
Subsidiaries as of such date and their consolidated results of operations and
changes in financial position for such nine month period (subject to normal
year-end adjustments).

 

(c) A copy of a duly completed and signed Annual Statement or other similar
report of or for each Insurance Subsidiary in the form filed with the
governmental body, agency or official which regulates insurance companies in the
jurisdiction in which such Insurance Subsidiary is domiciled for the year ended
December 31, 2002 has been delivered to the Administrative Agent on behalf of
each of the Banks and fairly presents, in accordance with statutory accounting
principles, the information contained therein.

 

(d) A copy of a duly completed and signed Quarterly Statement or other similar
report of or for each Insurance Subsidiary in the form filed with the
governmental body, agency or official which regulates insurance companies in the
jurisdiction in which such

 

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Insurance Subsidiary is domiciled for the quarter ended September 30, 2003 has
been delivered to the Administrative Agent on behalf of each of the Banks and
fairly presents, in accordance with statutory accounting principles, the
information contained therein.

 

(e) Since December 31, 2002 and as of the Effective Date, there has been no
material adverse change in the business, financial condition, results of
operations or prospects of the Company and its Consolidated Subsidiaries,
considered as a whole.

 

SECTION 4.05. Litigation. As of the Effective Date, there is no action, suit or
proceeding pending against, or to the knowledge of the Company threatened
against, the Company or any of its Subsidiaries before any court or arbitrator
or any governmental body, agency or official (a) in which there is a reasonable
possibility of an adverse decision in an amount in excess of $100,000,000
(exclusive of reserves and insurance recoveries relating thereto) which could
materially adversely affect the business, consolidated financial position or
consolidated results of operations of the Company and its Consolidated
Subsidiaries, considered as a whole, or (b) which in any manner draws into
question the validity or enforceability of this Agreement or any other Credit
Document.

 

SECTION 4.06. Compliance with ERISA. Each member of the ERISA Group has
fulfilled its obligations under the minimum funding standards of ERISA and the
Code with respect to each Plan and is in compliance in all material respects
with the presently applicable provisions of ERISA and the Code with respect to
each Plan. No member of the ERISA Group has (i) sought a waiver of the minimum
funding standard under Section 412 of the Code in respect of any Plan, (ii)
failed to make any contribution or payment to any Plan or Multiemployer Plan or
in respect of any Benefit Arrangement, or made any amendment to any Plan or
Benefit Arrangement, which has resulted or could result in the imposition of a
Lien or the posting of a bond or other security under ERISA or the Code or (iii)
incurred any liability under Title IV of ERISA other than a liability to the
PBGC for premiums under Section 4007 of ERISA.

 

SECTION 4.07. Taxes. United States Federal income tax returns of the Company and
its Subsidiaries have been examined and closed through the fiscal year ended
December 31, 1995. The Company and its Subsidiaries have filed all income tax
returns and all other material tax returns which are required to be filed by
them and have paid all taxes due pursuant to such returns or, except for any
such taxes that are being contested in good faith by appropriate proceedings and
for which adequate reserves have been made, pursuant to any assessment received
by the Company or any Subsidiary. The charges, accruals and reserves on the
books of the Company and its Subsidiaries in respect of taxes are, in the
opinion of the Company, adequate.

 

SECTION 4.08. Subsidiaries. Each of the Company’s Restricted Subsidiaries is a
corporation duly incorporated, validly existing and (except where such concept
is not applicable) in good standing under the laws of its jurisdiction of
incorporation, and has all corporate powers and all material governmental
licenses, authorizations, consents and approvals required to carry on its
business as now conducted.

 

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SECTION 4.09. Not an Investment Company. The Company is not an “investment
company” within the meaning of the Investment Company Act of 1940, as amended.

 

SECTION 4.10. Obligations to be Pari Passu. The Company’s obligations under this
Agreement and each other Credit Document to which it is a party rank pari passu
as to priority of payment and in all other respects with all other unsecured and
unsubordinated Debt of the Company.

 

SECTION 4.11. No Default. No event has occurred and is continuing which
constitutes, or which, with the passage of time or the giving of notice or both,
would constitute, a default under or in respect of any material agreement,
instrument or undertaking to which the Company or any Restricted Subsidiary is a
party or by which either the Company or any Restricted Subsidiary or any of
their respective assets is bound.

 

SECTION 4.12. Restricted Subsidiaries. Set forth as Schedule II hereto is a
true, correct and complete list of each Restricted Subsidiary as of the date
hereof.

 

SECTION 4.13. Environmental Matters. The Company has reasonably concluded that
Environmental Laws are unlikely to have a material adverse effect on the
business, consolidated financial condition, consolidated results of operations
or prospects of the Company and its Consolidated Subsidiaries, considered as a
whole.

 

SECTION 4.14. Full Disclosure. All written information heretofore furnished by
the Company to the Administrative Agent or any Bank for purposes of or in
connection with this Agreement or any transaction contemplated hereby is, and
all such information hereafter furnished by the Company to the Administrative
Agent or any Bank will be, true and accurate in all material respects on the
date as of which such information is stated or certified. To the best of its
knowledge, the Company has disclosed to the Banks in writing any and all facts
which materially and adversely affect or may materially and adversely affect (to
the extent the Company can now reasonably foresee) the business, consolidated
financial condition or consolidated results of operations of the Company and its
Consolidated Subsidiaries, taken as a whole, or the ability of each Account
Party to perform its obligations under the Credit Documents to which it is a
party.

 

SECTION 4.15. Separate Representations of Subsidiary Account Parties. Each of
the Subsidiary Account Parties represents and warrants that:

 

(a) Such Subsidiary Account Party is a company duly organized and validly
existing under the laws of the jurisdiction of its organization, and has all
corporate power and all material governmental licenses, authorizations, consents
and approvals required to carry on its business as now conducted.

 

(b) The execution, delivery and performance by such Subsidiary Account Party of
this Agreement and each other Credit Document to which it is a party are within
such Subsidiary Account Party’s corporate powers, have been duly authorized by
all necessary corporate action, require no action by or in respect of, or filing
with, any governmental body, agency or official and do not contravene, or
constitute a default

 

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under, any provision of applicable law or regulation or of any organizational
document of such Subsidiary Account Party or of any material agreement,
judgment, injunction, order, decree or other instrument binding upon such
Subsidiary Account Party or result in the creation or imposition of any Lien on
any asset of such Subsidiary Account Party.

 

(c) The Credit Documents (including this Agreement) to which such Subsidiary
Account Party is a party constitute the legal, valid and binding obligations of
such Subsidiary Account Party, in each case enforceable in accordance with their
respective terms, except as the same may be limited by bankruptcy, insolvency or
similar laws affecting creditors’ rights generally and by general principles of
equity.

 

(d) Such Subsidiary Account Party is not an “investment company” within the
meaning of the Investment Company Act of 1940, as amended.

 

(e) Such Subsidiary Account Party’s obligations under this Agreement to which it
is a party rank pari passu as to priority of payment and in all other respects
with all other unsecured and unsubordinated Debt of such Subsidiary Account
Party with the exception of those obligations that are mandatorily preferred by
law and not by contract.

 

(f) No event has occurred and is continuing which constitutes or which, with the
passage of time or the giving of notice or both, would constitute, a default
under or in respect of any material agreement, instrument or undertaking to
which such Subsidiary Account Party is a party or by which either such
Subsidiary Account Party or any of its assets is bound.

 

(g) Such Subsidiary Account Party is not the subject of (i) any winding up
(whether compulsory or otherwise) or any other corporate, judicial or
administrative proceeding or action which could result in the winding up of such
Subsidiary Account Party or (ii) any other proceeding or action relating to the
insolvency, bankruptcy, liquidation, moratorium on the payment of obligations or
any other similar condition of or relating to such Subsidiary Account Party, and
such Subsidiary Account Party has taken no action in furtherance of any of the
foregoing.

 

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ARTICLE V

 

COVENANTS

 

Until all Commitments have expired or been terminated and all fees payable
hereunder shall have been paid in full and all Letters of Credit shall have
expired or terminated and all LC Disbursements shall have been reimbursed, the
Company and (in the case of Sections 5.01(l), 5.02, 5.03, 5.04, 5.05, 5.06,
5.09, 5.11 and 5.12) the Subsidiary Account Parties agree that:

 

SECTION 5.01. Information. The Company (and, in the case of Section 5.01(l),
each Subsidiary Account Party, but only as to information concerning such
Subsidiary Account Party and its Subsidiaries) will deliver to each of the
Banks:

 

(a) within 90 days after the end of each fiscal year of the Company, if and only
to the extent not duplicative of information otherwise provided pursuant to
clause (i) below, the consolidated balance sheet of the Company and its
Consolidated Subsidiaries as of the end of such fiscal year and the related
consolidated statements of income, cash flows and shareholders’ equity for such
fiscal year, setting forth in each case in comparative form the figures for the
previous fiscal year, all reported on in a manner acceptable to the Securities
and Exchange Commission by Ernst & Young LLP or other independent public
accountants of nationally recognized standing;

 

(b) within 60 days after the end of each of the first three quarters of each
fiscal year of the Company, if and only to the extent not duplicative of
information otherwise provided pursuant to clause (i) below, the consolidated
balance sheet of the Company and its Consolidated Subsidiaries as of the end of
such quarter and the related consolidated statements of income, cash flows and
shareholders’ equity for such quarter and for the portion of the Company’s
fiscal year ended at the end of such quarter, setting forth in each case in
comparative form the figures for the corresponding quarter and the corresponding
portion of the Company’s previous fiscal year, all certified (subject to normal
year-end adjustments) as to fairness of presentation, generally accepted
accounting principles and consistency with the most recent audited consolidated
financial statements of the Company and its Consolidated Subsidiaries delivered
to the Banks (except for changes concurred in by the Company’s independent
public accountants) by the chief financial officer or the chief accounting
officer of the Company;

 

(c) simultaneously with the delivery of each set of financial statements
referred to in clauses (a) and (b) above (whether delivered as provided therein
or pursuant to clause (i) below), a certificate of the chief financial officer
or the chief accounting officer of the Company (i) setting forth in reasonable
detail the calculations required to establish whether the Company (and, in the
case of Section 5.09, the Subsidiary Account Parties and the Restricted
Subsidiaries) was in compliance with the requirements of Sections 5.07, 5.08 and
5.09 on the date of such financial statements and (ii) stating that such chief
financial officer or chief accounting officer, as the case may be, has no
knowledge of any Default existing on the date of such certificate or, if such
chief

 

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financial officer or chief accounting officer has knowledge of the existence on
such date of any Default, setting forth the details thereof and the action which
the Company or the applicable Subsidiary Account Party, as the case may be is
taking or proposes to take with respect thereto;

 

(d) simultaneously with the delivery of each set of financial statements
referred to in clause (a) above (whether delivered as provided therein or
pursuant to clause (i) below), a statement of the firm of independent public
accountants which reported on such statements (i) as to whether anything has
come to their attention to cause them to believe that any Default existed on the
date of such statements and (ii) confirming the calculations set forth in the
officer’s certificate delivered simultaneously therewith pursuant to clause (c)
above;

 

(e) within 120 days after the end of each fiscal year of each Insurance
Subsidiary, a copy of a duly completed and signed Annual Statement (or any
successor form thereto) required to be filed by such Insurance Subsidiary with
the governmental body, agency or official which regulates insurance companies in
the jurisdiction in which such Insurance Subsidiary is domiciled, in the form
submitted to such governmental body, agency or official;

 

(f) within 60 days after the end of each of the first three fiscal quarters of
each Insurance Subsidiary, a copy of a duly completed and signed Quarterly
Statement (or any successor form thereto) required to be filed by such Insurance
Subsidiary with the governmental body, agency or official which regulates
insurance companies in the jurisdiction in which such Insurance Subsidiary is
domiciled, in the form submitted to such governmental body, agency or official;

 

(g) forthwith upon learning of the occurrence of any Default, a certificate of
the chief financial officer or the chief accounting officer of the Company
setting forth the details thereof and the action which the Company is taking or
proposes to take with respect thereto;

 

(h) promptly upon the mailing thereof to the shareholders of the Company
generally, if and only to the extent not duplicative of information otherwise
provided pursuant to clause (i) below, copies of all financial statements,
reports and proxy statements so mailed;

 

(i) promptly upon the filing thereof, copies of all registration statements
(other than the exhibits thereto and any registration statements on Form S-8 or
its equivalent) and reports on Forms 10-K, 10-Q and 8-K (or their equivalents)
which any Account Party shall have filed with the Securities and Exchange
Commission;

 

(j) if and when any member of the ERISA Group (i) gives or is required to give
notice to the PBGC of any “reportable event” (as defined in Section 4043 of
ERISA) with respect to any Plan which might constitute grounds for a termination
of such Plan under Title IV of ERISA, or knows that the plan administrator of
any Plan has given or is required to give notice of any such reportable event, a
copy of the notice of such

 

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reportable event given or required to be given to the PBGC; (ii) receives notice
of complete or partial withdrawal liability under Title IV of ERISA or notice
that any Multiemployer Plan is in reorganization, is insolvent or has been
terminated, a copy of such notice; (iii) receives notice from the PBGC under
Title IV of ERISA of an intent to terminate, impose liability (other than for
premiums under Section 4007 of ERISA) in respect of, or appoint a trustee to
administer, any Plan, a copy of such notice; (iv) applies for a waiver of the
minimum funding standard under Section 412 of the Code, a copy of such
application; (v) gives notice of intent to terminate any Plan under Section
4041(c) of ERISA, a copy of such notice and other information filed with the
PBGC; (vi) gives notice of withdrawal from any Plan pursuant to Section 4063 of
ERISA, a copy of such notice; or (vii) fails to make any payment or contribution
to any Plan or Multiemployer Plan or in respect of any Benefit Arrangement or
makes any amendment to any Plan or Benefit Arrangement which has resulted or
could result in the imposition of a Lien or the posting of a bond or other
security, a certificate of the chief financial officer or the chief accounting
officer of the Company setting forth details as to such occurrence and action,
if any, which the Company or applicable member of the ERISA Group is required or
proposes to take;

 

(k) promptly after Moody’s or S&P shall have announced a change in the rating
established or deemed to have been established for the Index Debt, written
notice of such rating change; and

 

(l) from time to time such additional information regarding the financial
position or business of any Account Party as the Administrative Agent, at the
request of any Bank, may reasonably request.

 

SECTION 5.02. Payment of Obligations. The Company will pay and discharge, and
will cause each Restricted Subsidiary and Subsidiary Account Party to pay and
discharge, at or before maturity, all their respective material obligations and
liabilities, including, without limitation, tax liabilities, except where the
same may be contested in good faith by appropriate proceedings, and will
maintain, and will cause each Restricted Subsidiary to maintain, in accordance
with generally accepted accounting principles, appropriate reserves for the
accrual of any of the same.

 

SECTION 5.03. Conduct of Business and Maintenance of Existence. The Company will
continue, and will cause each Restricted Subsidiary and Subsidiary Account Party
to continue, to engage in business of the same general type as conducted by the
Company and its Restricted Subsidiaries, taken as a whole, on the date hereof
and will preserve, renew and keep in full force and effect, and will cause each
Restricted Subsidiary to preserve, renew and keep in full force and effect,
their respective corporate existence and their respective rights, privileges,
licenses and franchises which, in the judgment of the Board of Directors of the
Company, are necessary or desirable in the normal conduct of business.

 

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SECTION 5.04. Maintenance of Property; Insurance.

 

(a) The Company will keep, and will cause each Restricted Subsidiary and
Subsidiary Account Party to keep, all property useful and necessary in its
business in good working order and condition, ordinary wear and tear excepted.

 

(b) The Company will maintain, and will cause each of its Restricted
Subsidiaries to maintain (either in the name of the Company or in such
Subsidiary’s own name) with financially sound and responsible insurance
companies, insurance on all their respective properties and against at least
such risks, in each case in at least such amounts (and with such risk
retentions) as are usually insured against in the same general area by companies
of established repute engaged in the same or a similar business; and the Company
will furnish to the Banks, upon request from the Administrative Agent,
information presented in reasonable detail as to the insurance so carried.

 

SECTION 5.05. Compliance with Laws. The Company will comply, and will cause each
Subsidiary to comply, in all material respects with all applicable laws,
ordinances, rules, regulations and requirements of governmental authorities
(including, without limitation, Environmental Laws and ERISA and the rules and
regulations thereunder) except where the necessity of compliance therewith is
contested in good faith by appropriate proceedings.

 

SECTION 5.06. Inspection of Property, Books and Records. The Company will keep,
and will cause each Restricted Subsidiary and Subsidiary Account Party to keep,
proper books of record and account in which full, true and correct entries shall
be made of all dealings and transactions in relation to its business and
activities; and, subject in all cases to Section 10.11, will permit, and will
cause each Restricted Subsidiary and Subsidiary Account Party to permit,
representatives of any Bank to visit and inspect any of their respective
properties, to examine and make abstracts from any of their respective books and
records and to discuss their respective affairs, finances and accounts with
their respective officers, employees, actuaries and independent public
accountants, all upon reasonable notice, at such reasonable times during
ordinary business hours and as often as may reasonably be desired; provided that
neither the Company nor any of its Subsidiaries shall be required to disclose
any information subject to its attorney-client privilege.

 

SECTION 5.07. Minimum Adjusted Consolidated Net Worth. The Company will not
permit at any time Adjusted Consolidated Net Worth to be less than the sum of
(i) $3,500,000,000 plus (ii) 50% of the consolidated net income of the Company
and its Consolidated Subsidiaries for each fiscal quarter ending on or after
December 31, 2002: provided that in calculating such consolidated net income for
any fiscal quarter the impact thereon of FIN 46 and DIG B36 shall be excluded.
For purposes of this Section, if, for any such quarter, consolidated net income
of the Company and its Consolidated Subsidiaries shall be less than zero, the
amount calculated pursuant to clause (ii) above for such fiscal quarter shall be
zero.

 

SECTION 5.08. Adjusted Debt to Total Capitalization Ratio. The Company will not
permit, at any time that a Ratings Event shall have occurred and be continuing,
Adjusted Total Indebtedness to exceed 35% of the sum of (i) Adjusted Total
Indebtedness plus

 

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(ii) Adjusted Consolidated Net Worth. For purposes of this Section, a “Ratings
Event” shall have occurred if the Company’s senior unsecured and non-credit
enhanced long-term debt is not rated at least A- from S&P or A3 from Moody’s.

 

SECTION 5.09. Negative Pledge. Neither the Company nor any Restricted Subsidiary
will create, assume or suffer to exist any Lien on any asset now owned or
hereafter acquired by it, except:

 

(a) Liens existing on the date of this Agreement securing Debt outstanding on
the date of this Agreement in an aggregate principal amount not exceeding
$15,000,000;

 

(b) any Lien existing on any asset of any Person at the time such Person becomes
a Restricted Subsidiary and not created in contemplation or as a result of such
event;

 

(c) any Lien on any asset securing Debt incurred or assumed for the purpose of
financing all or any part of the cost of acquiring such asset, provided that
such Lien attaches to such asset concurrently with or within 90 days after the
acquisition thereof;

 

(d) any Lien on any asset of any Person existing at the time such Person is
merged or consolidated with or into the Company or another Restricted Subsidiary
and not created in contemplation or as a result of such event;

 

(e) any Lien existing on any asset prior to the acquisition thereof by the
Company or Restricted Subsidiary and not created in contemplation or as a result
of such acquisition;

 

(f) any Lien arising out of the refinancing, extension, renewal or refunding of
any Debt secured by any Lien permitted by any of the foregoing clauses of this
Section, provided that such Debt is not increased beyond the then outstanding
principal amount thereof and is not secured by any additional assets;

 

(g) Liens incidental to the conduct of its business or the ownership of its
assets which (i) do not secure Debt, (ii) do not secure any obligation in an
amount exceeding $10,000,000 and (iii) do not in the aggregate materially
detract from the value of its assets or materially impair the use thereof in the
operation of its business;

 

(h) Liens created by any Restricted Subsidiary as security for Debt owing to the
Company;

 

(i) Liens created by the Company as security for Debt owing to Subsidiaries, but
only if the only security for such Debt consists of Investments acquired by the
Company solely from the proceeds of such Debt;

 

(j) Liens on cash and cash equivalents securing Derivative Financial Products,
provided that the aggregate amount of cash and cash equivalents subject to such
Liens may at no time exceed $100,000,000;

 

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(k) in addition to the Liens permitted by clauses (a) through (j), inclusive,
and (1) and (m) of this Section, a Lien on any asset securing Debt of the
Company or Restricted Subsidiary, in an aggregate outstanding principal amount
at no time exceeding $10,000,000;

 

(1) in addition to the Liens permitted by clauses (a) through (k) and (m) and
(n) of this Section, any Lien on real property leased by the Company or any
Restricted Subsidiary pursuant to a capital lease (which capital lease was
entered into in connection with a sale leaseback transaction whereby the Company
or such Restricted Subsidiary, as the case may be, was the seller) securing Debt
of the Company or such Restricted Subsidiary, as the case may be, in an
aggregate outstanding principal amount at no time exceeding $50,000,000;

 

(m) Liens in favor of UNUM Life Insurance Company or First UNUM Life Insurance
Company on up to $4,500,000,000 of assets transferred to Subsidiaries in
connection with the purchase by such Subsidiaries of the tax sheltered annuity
business of UNUM Life Insurance Company and First UNUM Life Insurance Company;
and

 

(n) Liens created under this Agreement.

 

SECTION 5.10. Consolidations, Mergers and Sales of Assets. The Company will not
(i) consolidate or merge with or into any other Person or (ii) sell, lease or
otherwise transfer, directly or indirectly, all or substantially all of the
assets of the Company and its Subsidiaries, taken as a whole, to any other
Person; provided that the Company may merge with another Person if (A) the
Company is the corporation surviving such merger and (B) immediately after
giving effect to such merger, no Default shall have occurred and be continuing.

 

SECTION 5.11. Use of Credit. Each Account Party shall use each Letter of Credit
issued under this Agreement to support its insurance or reinsurance business. No
Letter of Credit will be used, directly or indirectly, for the purpose, whether
immediate, incidental or ultimate, of buying or carrying any “margin stock”
within the meaning of Regulations T, U and X.

 

SECTION 5.12. Obligations to be Pari Passu. Each Account Party’s obligations
under this Agreement to which it is a party will rank at all times pari passu as
to priority of payment and in all other respects with all other unsecured and
unsubordinated Debt of such Account Party with the exception of those
obligations that are mandatorily preferred by law and not by contract.

 

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ARTICLE VI

 

DEFAULTS

 

SECTION 6.01. Events of Default. If one or more of the following events (“Events
of Default”) shall have occurred and be continuing:

 

(a) (x) any Account Party shall fail to pay when due any reimbursement
obligation in respect of an LC Disbursement or (y) any Account Party shall fail
to pay when due any interest on any LC Disbursement or any fees or any other
amounts payable hereunder and such failure under this clause (y) shall continue
for four Business Days;

 

(b) any Account Party shall fail to observe or perform any covenant contained in
Sections 5.07 through 5.12, inclusive;

 

(c) any Account Party shall fail to observe or perform any covenant or agreement
contained in this Agreement (other than those covered by clause (a) or (b)
above) for 30 days after written notice thereof has been given to the Company by
the Administrative Agent at the request of any Bank;

 

(d) any representation, warranty, certification or statement made by any Account
Party in this Agreement or in any certificate, financial statement or other
document delivered pursuant to this Agreement shall prove to have been incorrect
in any material respect when made (or deemed made);

 

(e) the Company or any Subsidiary (other than a Newly Acquired Subsidiary) shall
fail to make any payment in respect of any Debt (other than any Debt solely of a
Newly Acquired Subsidiary existing at the time such Person becomes a Subsidiary
and not created in contemplation of such event (“Newly Acquired Subsidiary
Debt”)) having a principal amount then outstanding of not less than $25,000,000
when due and such failure shall continue beyond any applicable grace period or
the Company or any Subsidiary (other than a Newly Acquired Subsidiary) shall
fail to make any payment in an amount at least equal to $25,000,000 in respect
of any Derivative Financial Product when due and such failure shall continue
beyond any applicable grace period;

 

(f) any event or condition shall occur which results in the acceleration of the
maturity of any Debt (other than Newly Acquired Subsidiary Debt) having a
principal amount then outstanding of not less than $25,000,000 of the Company or
any Subsidiary or enables (or, with the giving of notice or lapse of time or
both, would enable) the holder of such Debt or any Person acting on such
holder’s behalf to accelerate the maturity thereof;

 

(g) any Account Party or Restricted Subsidiary (other than a Newly Acquired
Subsidiary) shall commence a voluntary case or other proceeding seeking
rehabilitation, dissolution, conservation, liquidation, reorganization or other
relief with respect to itself or its debts under any bankruptcy, insolvency or
other similar law now or hereafter in effect or seeking the appointment of a
trustee, receiver, liquidator, rehabilitator, dissolver,

 

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conservator, custodian or other similar official of it or any substantial part
of its property, or shall consent to any such relief or to the appointment of or
taking possession by any such official in an involuntary case or other
proceeding commenced against it, or shall make a general assignment for the
benefit of creditors, or shall fail generally to pay its debts as they become
due, or shall take any corporate action to authorize any of the foregoing;

 

(h) an involuntary case or other proceeding shall be commenced against any
Account Party or Restricted Subsidiary (other than a Newly Acquired Subsidiary)
seeking rehabilitation, dissolution, conservation, liquidation, reorganization
or other relief with respect to it or its debts under any bankruptcy, insolvency
or other similar law now or hereafter in effect or seeking the appointment of a
trustee, receiver, liquidator, rehabilitator, dissolver, conservator, custodian
or other similar official of it or any substantial part of its property, and
such involuntary case or other proceeding shall remain undismissed and unstayed
for a period of 60 days; or an order for relief shall be entered against any
Account Party or such Restricted Subsidiary under the federal bankruptcy laws as
now or hereafter in effect; or any governmental body, agency or official shall
apply for, or commence a case or other proceeding to seek, an order for the
rehabilitation, conservation, dissolution or other liquidation of Account Party
or Restricted Subsidiary or of the assets or any substantial part thereof of any
Account Party or Restricted Subsidiary or any other similar remedy;

 

(i) any member of the ERISA Group shall fail to pay when due an amount or
amounts aggregating in excess of $25,000,000 which it shall have become liable
to pay under Title IV of ERISA; or notice of intent to terminate a Material Plan
shall be filed under Title IV of ERISA by any member of the ERISA Group, any
plan administrator or any combination of the foregoing; or the PBGC shall
institute proceedings under Title IV of ERISA to terminate, to impose liability
(other than for premiums under Section 4007 of ERISA) in respect of, or to cause
a trustee to be appointed to administer, any Material Plan; or a condition shall
exist by reason of which the PBGC would be entitled to obtain a decree
adjudicating that any Material Plan must be terminated; or there shall occur a
complete or partial withdrawal from, or a default, within the meaning of Section
4219(c)(5) of ERISA, with respect to, one or more Multiemployer Plans which
could cause one or more members of the ERISA Group to incur a current payment
obligation in excess of $50,000,000;

 

(j) a judgment or order for the payment of money in excess of the greater of (i)
$100,000,000 or (ii) 3% of the consolidated shareholders’ equity of the Company
and its Consolidated Subsidiaries (after (without duplication) the actual
amounts of insurance recoveries, offsets and contributions received and amounts
thereof not yet received but which the insurer thereon has acknowledged in
writing its obligation to pay) shall be rendered against any Account Party or
Restricted Subsidiary and such judgment or order shall continue unsatisfied and
unstayed for a period of 90 days after entry of such judgment (and, for purposes
of this clause, a judgment shall be stayed if, among other things, an appeal is
timely filed and such judgment cannot be enforced);

 

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(k) any person or group of persons (within the meaning of Section 13 or 14 of
the Securities Exchange Act of 1934, as amended) shall have acquired beneficial
ownership (within the meaning of Rule 13d-3 promulgated by the Securities and
Exchange Commission under said Act) of 20% or more of the outstanding shares of
common stock of the Company; or, during any period of 12 consecutive calendar
months, individuals who were directors of the Company on the first day of such
period shall cease to constitute a majority of the board of directors of the
Company; or

 

(l) any Subsidiary Account Party shall cease for any reason to be a Consolidated
Subsidiary, unless (i) such Subsidiary Account Party shall have been
consolidated or merged with or into a wholly owned Subsidiary or the Company or
(ii) Subsidiary Account Party shall have been terminated as an Account Party
hereunder pursuant to Section 10.13;

 

then, and in every such event, and at any time thereafter during the continuance
of such event, the Administrative Agent shall, if requested by the Required
Banks, by notice to the Company take any or all of the following actions, at the
same or different times: (i) terminate the Commitments and they shall thereupon
terminate, (ii) declare that all fees and other obligations of the Account
Parties accrued hereunder shall become due and payable immediately, without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by each Account Party and the Guarantor, (iii) notify each
beneficiary of an outstanding Committed Letters of Credit of the Event of
Default and cause a drawing of the aggregate undrawn amount thereunder (if such
Letters of Credit so permit) and (iv) demand provision of cover from the Account
Parties and the Guarantor in immediately available funds in an amount equal to
the then aggregate undrawn amount of all Committed Letters of Credit pursuant to
Section 2.03(e); provided that, in the case of any of the Events of Default
specified in clause (g) or (h) above (A) with respect to the Company, without
any notice to any Account Party or the Guarantor or any other act by the
Administrative Agent or the Banks, the Commitments shall thereupon terminate and
all fees and other obligations of the Account Parties accrued hereunder shall
automatically become due and payable without presentment, demand, protest or
notice of any kind, all of which are hereby waived by each Account Party and the
Guarantor and (B) with respect to any Subsidiary Account Party, without any
notice to any Account Party or the Guarantor or any other act by the
Administrative Agent or the Banks, the Commitments to issue Letters of Credit
for account of such Account Party shall thereupon terminate and all fees and
other obligations of such Account Party shall become immediately due and payable
without presentment, demand, protest or notice of any kind, all of which are
hereby waived by the Account Parties and the Guarantor; provided, further, that,
in the case of an Event of Default under Section 6.01(b) resulting from a
default by any Subsidiary Account Party under Section 5.09, 5.11 or 5.12 or
under Section 6.01(c) or (d) (in the latter case, resulting from a default by
any Subsidiary Account Party under Section 4.15), the termination of the
Commitments, the acceleration of all fees and other obligations of the Account
Parties accrued hereunder and the causing of drawings under Committed Letters of
Credit shall apply only to the Commitments, fees, obligations in respect of such
Subsidiary Account Party and to the Letters of Credit with respect to which it
is the Account Party. In addition, in the event that Committed Letters of Credit
are outstanding on the Commitment Termination Date, the Administrative Agent
shall, if requested by the Required Banks, by notice to the Company demand cover
from

 

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the Account Parties and the Guarantor in immediately available funds in an
amount equal to the then aggregate undrawn amount of all Committed Letters of
Credit pursuant to Section 2.03(e).

 

SECTION 6.02. Notice of Default. The Administrative Agent shall give notice to
the Company under Section 6.01(c) promptly upon being requested to do so by any
Bank and shall thereupon notify all the Banks thereof.

 

SECTION 6.03. Alternative Currency Letters of Credit. Each Account Party agrees,
in addition to the provisions of Section 6.01, that upon the occurrence and
during the continuance of any Event of Default any Bank which has issued any
Alternative Currency Letter of Credit may, by notice to the Company and the
Administrative Agent: (a) declare that all fees and other obligations of the
Account Parties accrued in respect of Alternative Currency Letters of Credit
with respect to which it is the Account Party and issued by such Bank shall
become due and payable immediately, without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by each Account Party
and the Guarantor, (b) notify each beneficiary of each such outstanding
Alternative Currency Letter of Credit of the Event of Default, (c) cause a
drawing of the aggregate undrawn amount thereunder, provided that such
Alternative Currency Letters of Credit so permit, and (d) demand cover from the
Account Parties in immediately available funds an amount equal to the then
aggregate undrawn face amount of all such Alternative Currency Letters of
Credit; provided that, in the case of any of the Events of Default specified in
clause (g) or (h) of Section 6.01, (a) with respect to the Company, without any
notice to any Account Party or the Guarantor or any other act by the
Administrative Agent or the Banks, all fees and other obligations of the Account
Parties accrued in respect of all Alternative Currency Letters of Credit shall
become due and payable immediately, without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by each Account Party
and the Guarantor and (b) with respect to any Subsidiary Account Party, without
any notice to any Account Party or the Guarantor or any other act by the
Administrative Agent or the Banks, all fees and other obligations of such
Subsidiary Account Party accrued in respect of Alternative Currency Letters of
Credit with respect to which it is the Account Party and issued by such Bank
shall become due and payable immediately, without presentment, demand, protest
or other notice of any kind, all of which are hereby waived by each Account
Party and the Guarantor; provided, further, that, in the case of an Event of
Default under Section 6.01(b) resulting from a default by any Subsidiary Account
Party under Section 5.09, 5.11 or 5.12 or under Section 6.01(c) or (d) (in the
latter case, resulting from a default by any Subsidiary Account Party under
Section 4.15), the acceleration of all fees and other obligations of the Account
Parties accrued hereunder and the causing of drawings under Alternative Currency
Letters of Credit shall apply only to fees and obligations in respect of such
Subsidiary Account Party and to the Alternative Currency Letters of Credit with
respect to which it is the Account Party. If the Administrative Agent receives
any notice from a Bank pursuant to the previous sentence, then it will promptly
give notice thereof to the other Banks. In addition, in the event that any
Alternative Currency Letter of Credit is outstanding on the Commitment
Termination Date, the Bank which has issued such Alternative Currency Letter of
Credit may, by notice to the Company and the Administrative Agent demand cover
from the Account Parties in immediately available funds an amount equal to the
then aggregate undrawn face amount of all such Alternative Currency Letters of
Credit.

 

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ARTICLE VII

 

THE ADMINISTRATIVE AGENT

 

SECTION 7.01. Appointment and Authorization. Each Bank irrevocably appoints and
authorizes the Administrative Agent to take such action as agent on its behalf
and to exercise such powers under this Agreement as are delegated to the
Administrative Agent by the terms hereof, together with all such powers as are
reasonably incidental thereto.

 

SECTION 7.02. Agent’s Fee. The Company shall pay to the Administrative Agent for
its own account fees in the amounts and at the times previously agreed upon
between the Company and the Administrative Agent.

 

SECTION 7.03. Agent and Affiliates. JPMCB shall have the same rights and powers
under this Agreement as any other Bank and may exercise or refrain from
exercising the same as though it were not the Administrative Agent, and JPMCB
and its Affiliates may accept deposits from, lend money to, and generally engage
in any kind of business with the Company or any Subsidiary or Affiliate of any
thereof as if it were not the Administrative Agent hereunder.

 

SECTION 7.04. Action by Agent. The obligations of the Administrative Agent
hereunder are only those expressly set forth herein. The Administrative Agent
shall not have any duty to take any discretionary action permitted to be taken
by it pursuant to the provisions of this Agreement unless it shall be requested
in writing to do so by the Required Banks. Without limiting the generality of
the foregoing, the Administrative Agent shall not be required to take any action
with respect to any Default, except as expressly provided in Article VI. The
Administrative Agent shall have no duty to disclose to the Banks information
that is not required to be furnished by an Account Party to the Administrative
Agent at such time, but is voluntarily furnished by an Account Party to the
Administrative Agent (either in its capacity as Administrative Agent or in its
individual capacity).

 

SECTION 7.05. Consultation with Experts. The Administrative Agent may consult
with legal counsel (who may be counsel for any Account Party), independent
public accountants and other experts selected by it and shall not be liable for
any action taken or omitted to be taken by it in good faith in accordance with
the advice of such counsel, accountants or experts.

 

SECTION 7.06. Liability of Agent. Neither the Administrative Agent nor any of
its directors, officers, agents or employees shall be liable to any Bank for any
action taken or not taken by it in connection herewith (i) with the consent or
at the request of the Required Banks or (ii) in the absence of its own gross
negligence or willful misconduct. The Administrative Agent shall be deemed not
to have knowledge of any Default unless and until written notice thereof is
given to the Administrative Agent by an Account Party or a Bank. Neither the
Administrative Agent nor any of its directors, officers, agents or employees
shall be responsible to any Bank for or have any duty to any Bank to ascertain,
inquire into or verify (i) any statement, warranty or representation made in
connection with this Agreement or any issuance, amendment, renewal or extension
of a Letter of Credit; (ii) the performance or observance of any of the
covenants or

 

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agreements of any Account Party; (iii) the satisfaction of any condition
specified in Article III, except receipt of items required to be delivered to
the Administrative Agent; (iv) the validity, effectiveness or genuineness of
this Agreement or any other instrument or writing furnished in connection
herewith; (v) any Alternative Currency Letter of Credit or any action or failure
to act relating thereto; (vi) the existence or possible existence of any
Default; (vii) the financial condition of any Account Party or any Account
Party’s Subsidiaries; or (viii) the contents of any certificate, report or other
document delivered hereunder or in connection herewith. The Administrative Agent
shall not incur any liability by acting in reliance upon any notice, consent,
certificate, statement, or other writing (which may be a bank wire, telex or
similar writing) believed by it in good faith to be genuine or to be signed by
the proper party or parties.

 

SECTION 7.07. Indemnification. Each Bank shall, ratably in accordance with its
initial Commitment, indemnify the Administrative Agent (to the extent not
reimbursed by the Company) against any cost, expense (including counsel fees and
disbursements), claim, demand, action, loss or liability (except such as result
from the Administrative Agent’s gross negligence or willful misconduct) that the
Administrative Agent may suffer or incur in connection with this Agreement or
any action taken or omitted by the Administrative Agent hereunder. The
Administrative Agent shall be fully justified in failing or refusing to take any
action hereunder unless it shall first be indemnified to its satisfaction by the
Banks pro rata against any and all liability, cost and expense that it may incur
by reason of taking or continuing to take any such action.

 

SECTION 7.08. Credit Decision. Each Bank acknowledges that it has, independently
and without reliance upon the Administrative Agent or any other Bank, and based
on such documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement. Each Bank also
acknowledges that it will, independently and without reliance upon the
Administrative Agent or any other Bank, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking any action under this Agreement.

 

SECTION 7.09. Successor Agent. The Administrative Agent may resign at any time
by giving written notice thereof to the Banks and the Company. Upon any such
resignation, the Required Banks shall have the right to appoint a successor
Administrative Agent, which successor Administrative Agent shall be satisfactory
to the Company, provided that no Default is continuing. If no successor
Administrative Agent shall have been so appointed by the Required Banks, and
shall have accepted such appointment, within 30 days after the retiring
Administrative Agent gives notice of resignation, then the retiring
Administrative Agent may, on behalf of the Banks, appoint a successor Agent,
which shall be a commercial bank organized or licensed under the laws of the
United States of America or of any State thereof and having a combined capital
and surplus of at least $100,000,000 and (unless a Default has occurred and is
continuing) shall otherwise be subject to the consent of the Company, which
consent shall not be unreasonably withheld. Upon the acceptance of its
appointment as Administrative Agent hereunder by a successor Administrative
Agent, such successor Administrative Agent shall thereupon succeed to and become
vested with all the rights and duties of the retiring Administrative Agent, and
the retiring Administrative Agent shall be discharged from its duties and
obligations hereunder. After any retiring Administrative Agent’s resignation
hereunder as

 

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Administrative Agent, the provisions of this Article shall inure to its benefit
as to any actions taken or omitted to be taken by it while it was Administrative
Agent.

 

SECTION 7.10. Delegation to Affiliates. The Account Party and the Banks agree
that the Administrative Agent may delegate any of its duties under this
Agreement to any of its Affiliates. Any such Affiliate (and such Affiliate’s
directors, officers, agents and employees) which performs duties in connection
with this Agreement shall be entitled to the same benefits of the
indemnification, waiver and other protective provisions to which the
Administrative Agent is entitled under Articles VII and X.

 

SECTION 7.11. Lead Arranger and Other Agents. Notwithstanding anything herein to
the contrary, neither the Lead Arranger nor any Syndication Agent listed on the
cover page of this Agreement shall have any right, power, obligation, liability,
responsibility or duty under this Agreement in its capacity as such, except in
its respective capacity, if any, as a Bank.

 

ARTICLE VIII

 

CHANGE IN CIRCUMSTANCES

 

SECTION 8.01. Increased Cost and Reduced Return.

 

(a) If on or after the date hereof the adoption of any applicable law, rule or
regulation, or any change in any applicable law, rule or regulation, or any
change in the interpretation or administration thereof by any governmental
authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Bank (or its Applicable Credit
Office) with any request or directive (whether or not having the force of law)
of any such authority, central bank or comparable agency shall impose, modify or
deem applicable any reserve (including, without limitation, any such requirement
imposed by the Board of Governors of the Federal Reserve System), special
deposit, insurance assessment or similar requirement against assets of, deposits
with or for the account of, or credit extended by, any Bank (or its Applicable
Credit Office) or shall impose on any Bank (or its Applicable Credit Office) any
other condition affecting its obligation to issue Committed Letters of Credit,
any outstanding Letters of Credit or reimbursement claims in respect of LC
Disbursements and the result of any of the foregoing is to increase the cost to
such Bank (or its Applicable Credit Office) of issuing or maintaining any Letter
of Credit, or to reduce the amount of any sum received or receivable by such
Bank (or its Applicable Credit Office) under this Agreement with respect
thereto, by an amount deemed by such Bank to be material, then, within 15 days
after demand by such Bank (with a copy to the Administrative Agent), the
applicable Account Party or Account Parties shall pay to such Bank such
additional amount or amounts as will compensate such Bank for such increased
cost or reduction.

 

(b) If any Bank shall have determined that, after the date hereof, the adoption
of any applicable law, rule or regulation regarding capital adequacy, or any
change in any applicable law, rule or regulation regarding capital adequacy, or
any change in the interpretation or administration thereof by any governmental
authority, central bank or comparable agency charged with the interpretation or
administration thereof, or any request or directive regarding

 

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capital adequacy (whether or not having the force of law) of any such authority,
central bank or comparable agency, has or would have the effect of reducing the
rate of return on capital of such Bank (or its Parent) as a consequence of such
Bank’s obligations hereunder to a level below that which such Bank (or its
Parent) could have achieved but for such adoption, change, request or directive
(taking into consideration its policies with respect to capital adequacy) by an
amount deemed by such Bank to be material, then from time to time, within 15
days after demand by such Bank (with a copy to the Administrative Agent), the
Company shall pay to such Bank such additional amount or amounts as will
compensate such Bank (or its Parent) for such reduction.

 

(c) Each Bank will promptly notify the Company and the Administrative Agent of
any event of which it has knowledge, occurring after the date hereof, which will
entitle such Bank to compensation pursuant to this Section and will designate a
different Applicable Credit Office if such designation will avoid the need for,
or reduce the amount of, such compensation and will not, in the judgment of such
Bank, be otherwise disadvantageous to such Bank. A certificate of any Bank
claiming compensation under this Section and setting forth the additional amount
or amounts to be paid to it hereunder and, in reasonable detail, such Bank’s
computation of such amount or amounts, shall be conclusive in the absence of
manifest error. In determining such amount, such Bank may use any reasonable
averaging and attribution methods.

 

SECTION 8.02. Taxes.

 

(a) For purposes of this Section, the following terms have the following
meanings:

 

“Taxes” means any and all present or future taxes, duties, levies, imposts,
deductions, charges or withholdings of any nature with respect to any payment by
any Account Party or the Guarantor pursuant to this Agreement or any other
Credit Document, and all liabilities with respect thereto, excluding, in the
case of each Bank and the Administrative Agent, taxes imposed on its net income,
and franchise or similar taxes imposed on it, by a jurisdiction under the laws
of which such Bank or the Administrative Agent (as the case may be) is organized
or in which its principal executive office is located or, in the case of each
Bank, in which its Applicable Credit Office is located (all such excluded taxes
being hereinafter referred to as “Domestic Taxes”). If the form provided by a
Bank pursuant to Section 8.02(d) at the time such Bank first becomes a party to
this Agreement indicates a United States interest withholding tax rate in excess
of zero, any United States interest withholding tax at such rate imposed on
payments by the Company under this Agreement shall be excluded from the
definition of “Taxes”.

 

“Other Taxes” means any present or future stamp or documentary taxes and any
other excise or property taxes, or similar charges or levies, which arise from
any payment made pursuant to this Agreement or any other Credit Document or from
the execution, delivery, registration or enforcement of, or otherwise with
respect to, this Agreement or any other Credit Document.

 

(b) Any and all payments by any Account Party or the Guarantor to or for account
of any Bank or the Administrative Agent hereunder shall be made without
deduction or

 

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withholding for any Taxes or Other Taxes; provided that, if any Account Party or
the Guarantor shall be required by law to deduct any Taxes or Other Taxes from
any such payments, (i) the sum payable shall be increased as necessary so that
after making all required deductions and withholdings (including deductions and
withholdings applicable to additional sums payable under this Section) such Bank
or the Administrative Agent (as the case may be) receives an amount equal to the
sum it would have received had no such deductions or withholdings been made,
(ii) such Account Party or the Guarantor shall make such deductions or
withholdings, (iii) such Account Party or the Guarantor shall pay the full
amount deducted or withheld to the relevant taxation authority or other
authority in accordance with applicable law and (iv) such Account Party or the
Guarantor shall promptly furnish to the Administrative Agent, at its address
referred to in Section 10.01, the original or a certified copy of a receipt
evidencing payment thereof, and, if such receipt relates to Taxes or Other Taxes
in respect of a sum payable to any Bank, the Administrative Agent shall promptly
deliver such original or certified copy to such Bank.

 

(c) The Company agrees to indemnify each Bank and the Administrative Agent for
the full amount of Taxes or Other Taxes (including, without limitation, any
Taxes or Other Taxes imposed or asserted by any jurisdiction on amounts payable
under this Section), whether or not correctly or legally imposed, paid by such
Bank or the Administrative Agent (as the case may be) and any liability
(including penalties, interest and expenses) arising therefrom or with respect
thereto. In addition, the Company agrees to indemnify each Bank and the
Administrative Agent for all Domestic Taxes of such Bank or the Administrative
Agent (calculated based on a hypothetical basis at the maximum marginal rate for
a corporation) and any liability (including penalties, interest and expenses to
the extent not attributable to the gross negligence or willful misconduct of
each Bank or the Administrative Agent, as the case may be) arising therefrom or
with respect thereto, in each case to the extent that such Domestic Taxes result
from any payment or indemnification pursuant to this Section for any taxes
imposed by any jurisdiction for which the Account Party is responsible under
Section 8.02(a), (b) or (c). This indemnification shall be paid within 30 days
after such Bank or Agent, as the case may be, makes demand therefor.

 

(d) At least five Business Days prior to the first date on which interest or
fees are payable hereunder for the account of any Bank, each Bank that is not
incorporated under the laws of the United States of America or a state thereof
agrees that it will deliver to each of the Company and the Administrative Agent
two duly completed copies of United States Internal Revenue Service Form W-8BEN
or W-8ECI, certifying in either case that such Bank is entitled to receive
payments under this Agreement without deduction or withholding of any United
States federal income taxes. Each Bank which so delivers a Form W-8BEN or W-8ECI
further undertakes to deliver to each of the Company and the Administrative
Agent two additional copies of such form (or successor form) on or before the
date that such form expires or becomes obsolete or after the occurrence of any
event requiring a change in the most recent form so delivered by it, and such
amendments thereto or extensions or renewals thereof as may be reasonably
requested by the Company or the Administrative Agent, in each case certifying
that such Bank is entitled to receive payments under this Agreement without
deduction or withholding of any United States federal income taxes, unless an
event (including without limitation any change in treaty, law or regulation) has
occurred prior to the date on which any

 

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such delivery would otherwise be required which renders all such forms
inapplicable or which would prevent such Bank from duly completing and
delivering any such form with respect to it and such Bank advises the Company
and the Administrative Agent that it is not capable of receiving payments
without any deduction or withholding of United States federal income tax.

 

(e) For any period with respect to which a Bank has failed to provide the
Company or the Administrative Agent with the appropriate form as required by
Section 8.02(d) (whether or not such Bank is lawfully able to do so, unless such
failure is due to a change in treaty, law or regulation occurring subsequent to
the date on which such form originally was required to be provided), such Bank
shall not be entitled to indemnification under Section 8.02(b) or (c) with
respect to any withholding of the United States federal income tax; provided
that if a Bank, which is otherwise exempt from or subject to a reduced rate of
withholding tax, becomes subject to Taxes because of its failure to deliver a
form required hereunder, the Company shall take such steps as such Bank shall
reasonably request to assist such Bank to recover such Taxes.

 

(f) If any Account Party or the Guarantor is required to pay additional amounts
to or for the account of any Bank pursuant to this Section as a result of a
change of law occurring after the date hereof, then such Bank, at the request of
the Company, will change the jurisdiction of its Applicable Credit Office if, in
the sole judgment of such Bank, such change (i) will eliminate or reduce any
such additional payment which may thereafter accrue and (ii) is not otherwise
disadvantageous to such Bank.

 

(g) Each Bank and the Administrative Agent shall, at the request of the Company,
use reasonable efforts (consistent with applicable legal and regulatory
restrictions) to file any certificate or document requested by the Company if
the making of such a filing would avoid the need for or reduce the amount of any
such additional amounts payable to or for account of such Bank or the
Administrative Agent (as the case may be) pursuant to this Section which may
thereafter accrue and would not, in the sole judgment of such Bank or the
Administrative Agent, require such Bank or the Administrative Agent to disclose
any confidential or proprietary information or be otherwise disadvantageous to
such Bank or the Administrative Agent.

 

(h) Notwithstanding the foregoing, nothing in this Section shall interfere with
the rights of any Bank to conduct its fiscal or tax affairs in such manner as it
deems fit.

 

ARTICLE IX

 

GUARANTY

 

SECTION 9.01. The Guaranty. The Company hereby unconditionally guarantees the
full and punctual payment of all reimbursement obligations in respect of LC
Disbursements and all interest thereon payable by each Subsidiary Account Party
pursuant to this Agreement (including, without limitation, any Subsidiary
Account Party that shall become party hereto after the date hereof pursuant to
Section 10.13), and the full and punctual payment of all other amounts payable
by each Subsidiary Account Party under this Agreement, including amounts payable
as cover in respect of outstanding letter of credit exposure pursuant to
Sections 2.03(e),

 

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6.01 and 6.03. Upon failure by any Subsidiary Account Party to pay punctually
any such amount, the Company shall forthwith on demand pay the amount not so
paid at the place and in the manner specified in this Agreement.

 

SECTION 9.02. Guaranty Unconditional. The obligations of the Company hereunder
shall be unconditional, absolute and continuing and, without limiting the
generality of the foregoing, shall not be released, discharged or otherwise
affected by:

 

(i) any extension, renewal, settlement, compromise, waiver or release in respect
of any obligation of any Subsidiary Account Party under this Agreement, by
operation of law or otherwise;

 

(ii) any modification or amendment of or supplement to this Agreement;

 

(iii) any release, impairment, non-perfection or invalidity of any direct or
indirect security for any obligation of any Subsidiary Account Party under this
Agreement;

 

(iv) any change in the corporate existence, structure or ownership of any
Subsidiary Account Party, or any insolvency, bankruptcy, reorganization or other
similar proceeding affecting any Subsidiary Account Party or its assets or any
resulting release or discharge of any obligation of any Subsidiary Account Party
contained in this Agreement;

 

(v) the existence of any claim, set-off or other rights which the Company may
have at any time against any Subsidiary Account Party, the Administrative Agent,
any Bank or any other Person, whether in connection herewith or any unrelated
transactions, provided that nothing herein shall prevent the assertion of any
such claim by separate suit or compulsory counterclaim;

 

(vi) any invalidity or unenforceability relating to or against any Subsidiary
Account Party for any reason of this Agreement, or any provision of applicable
law or regulation purporting to prohibit the payment by any Subsidiary Account
Party of any reimbursement obligation, interest or any other amount payable by
it under this Agreement;

 

(vii) any other act or omission to act or delay of any kind by Subsidiary
Account Party, the Administrative Agent, any Bank or any other Person or any
other circumstance whatsoever which might, but for the provisions of this
paragraph, constitute a legal or equitable discharge of or defense to the
Company’s obligations hereunder; or

 

(viii) any Bank and its Affiliates accepting deposits from, lending money to, or
otherwise engaging in any kind of business with the Company, its Subsidiaries,
the Subsidiary Account Parties or the Affiliates of any thereof.

 

SECTION 9.03. Discharge Only Upon Payment In Full; Reinstatement In Certain
Circumstances. The Company’s obligations hereunder shall remain in full force
and effect until the Commitments shall have terminated and all reimbursement
obligations, interest and all other

 

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amounts payable by the Company and each Subsidiary Account Party under this
Agreement shall have been paid in full. If at any time any payment of
reimbursement obligation, interest or any other amount payable by any Subsidiary
Account Party under this Agreement is rescinded or must be otherwise restored or
returned upon the insolvency, bankruptcy or reorganization of such Subsidiary
Account Party or otherwise, the Company’s obligations hereunder with respect to
such payment shall be reinstated at such time as though such payment had been
due but not made at such time.

 

SECTION 9.04. Waiver by the Company. The Company irrevocably waives acceptance
hereof, presentment, demand, protest and any notice not provided for herein, as
well as any requirement that at any time any action be taken by any Person
against any Subsidiary Account Parties or any other Person.

 

SECTION 9.05. Subrogation. Upon making any payment with respect to the
obligations of any Subsidiary Account Party hereunder, the Company shall be
subrogated to the rights of the payee against such Subsidiary Account Party with
respect to such payment; provided that the Company shall not enforce any payment
by way of subrogation against such Subsidiary Account Party so long as (i) any
Bank has any Commitment hereunder or (ii) any amount payable hereunder remains
unpaid.

 

ARTICLE X

 

MISCELLANEOUS

 

SECTION 10.01. Notices. All notices, requests and other communications to any
party hereunder shall be in writing (including bank wire, telex, facsimile
transmission or similar writing, or by electronic communication, if arrangements
for doing so have been approved by such party) and shall be given to such party:
(w) in the case of any Account Party, at the Company’s address or telex or
telecopier number set forth on the Company’s signature page hereof, (x) in the
case of the Administrative Agent, at its address or telex or telecopier number
set forth on its respective signature page hereof, (y) in the case of any Bank,
at its address or telex or telecopier number set forth in its Administrative
Questionnaire or (z) in the case of any party, such other address or telex or
telecopier number as such party may hereafter specify for the purpose by notice
to the Administrative Agent and the Company. Each such notice, request or other
communication shall be effective (i) if given by telex, when such telex is
transmitted to the telex number specified in this Section and the appropriate
answerback is received, (ii) if given by mail, 72 hours after such communication
is deposited in the mails with first class postage prepaid, addressed as
aforesaid and return receipt requested, (iii) if given by telecopier, when
transmitted to the telecopier number specified in this Section or (iv) if given
by any other means, when delivered at the relevant address specified by such
party pursuant to this Section; provided that notices to the Administrative
Agent under Article II or Article VIII shall not be effective until received.

 

SECTION 10.02. No Waivers. No failure or delay by the Administrative Agent or
any Bank in exercising any right, power or privilege hereunder shall operate as
a waiver thereof nor shall any single or partial exercise thereof preclude any
other or further exercise

 

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thereof or the exercise of any other right, power or privilege. The rights and
remedies herein provided shall be cumulative and not exclusive of any rights or
remedies provided by law.

 

SECTION 10.03. Expenses; Indemnification; Non-Liability of Banks.

 

(a) The Company shall pay (i) all out-of-pocket expenses of the Administrative
Agent, including reasonable fees and disbursements of special counsel for the
Administrative Agent, in connection with the preparation of this Agreement, any
waiver or consent hereunder or any amendment hereof or any Default or alleged
Default hereunder and (ii) if an Event of Default occurs, all out-of-pocket
expenses incurred by the Administrative Agent and each Bank, including fees and
disbursements of counsel including costs allocated to in-house counsel, in
connection with such Event of Default and collection, bankruptcy, insolvency and
other enforcement proceedings resulting therefrom.

 

(b) The Company agrees to indemnify the Administrative Agent, each Bank and each
Confirming Bank, their Affiliates and the respective directors, officers,
agents, advisors and employees of the foregoing (each an “Indemnitee”) and hold
each Indemnitee harmless from and against any and all liabilities, losses,
damages, costs and expenses of any kind, including, without limitation, the
reasonable fees and disbursements of counsel and costs of settlement, which may
be incurred by such Indemnitee in connection with any investigative,
administrative or judicial proceeding (whether or not such Indemnitee shall be
designated a party thereto) relating to or arising out of this Agreement or any
actual or proposed use of proceeds of Letters of Credits or the proceeds
thereof; provided that no Indemnitee shall have the right to be indemnified
hereunder for its own gross negligence or willful misconduct as determined by a
court of competent jurisdiction or for the breach by such Indemnitee of its
obligations hereunder or, in the case of a Confirming Bank, under its Confirming
Bank Agreement.

 

SECTION 10.04. Sharing of Set-Offs. Each Bank agrees that if it shall, by
exercising any right of set-off or counterclaim or otherwise, receive payment of
a proportion of the aggregate reimbursement obligation or interest due with
respect to any LC Disbursement made by it under a Committed Letter of Credit
which is greater than the proportion received by any other Bank in respect of
the aggregate reimbursement obligation or interest due, as the case may be, with
respect to any LC Disbursement made by such other Bank under such Letter of
Credit, the Bank receiving such proportionately greater payment shall purchase
such participations in the LC Exposure by the other Banks under such Letter of
Credit, and such other adjustments shall be made, as may be required so that all
such payments of reimbursement obligations and interest with respect to LC
Disbursements made by the Banks under such Letter of Credit shall be shared by
the Banks pro rata; provided that nothing in this Section shall impair the right
of any Bank to exercise any right of set-off or counterclaim it may have and to
apply the amount subject to such exercise to the payment of indebtedness of the
applicable Account Party other than its indebtedness under this Agreement. Each
Account Party agrees, to the fullest extent it may effectively do so under
applicable law, that any holder of a participation in any LC Exposure, whether
or not acquired pursuant to the foregoing arrangements, may exercise rights of
set-off or counterclaim and other rights with respect to such participation as
fully as if such holder of a participation were a direct creditor of such
Account Party in the amount of such participation.

 

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SECTION 10.05. Amendments and Waivers. Any provision of this Agreement may be
amended or waived if, but only if, such amendment or waiver is in writing and is
signed by each Account Party and the Required Banks or by the Administrative
Agent (with the consent of the Required Banks) (and, if the rights or duties of
the Administrative Agent are affected thereby, by the Administrative Agent);
provided that the Administrative Agent may, with the consent of the Company
(which shall not be unreasonably withheld), specify by notice to the Banks
modifications in the procedures set forth in Section 2.01(b); provided, further,
that the consent of each Bank affected thereby shall be required with respect to
any amendment, waiver or modification that (i) increases the amount or extends
the expiry date of the Commitment of any Bank, increases the LC Exposure of such
Bank or otherwise subjects any Bank to any additional obligation, (ii) reduces
the reimbursement obligation of any Account Party in respect of any LC
Disbursement, the rate or amount of interest thereon or any fees payable to such
Bank hereunder, (iii) postpones the scheduled date for reimbursement of any LC
Disbursement, or any interest thereon, or any fees payable hereunder, or waives
or excuses any such payment, or postpones the scheduled date of expiration of
any Commitment, or (iv) alters the manner in which reimbursement payments,
interest or other amounts hereunder shall be applied as among the Banks;
provided, further, that the consent of 100% of the Banks shall be required with
respect to (x) any change in the percentage of the Commitments or of the LC
Exposure or the number of Banks, which shall be required for the Banks or any of
them to take any action under this Section or any other provision of this
Agreement, (y) the release of any of the collateral provided for cover of the
Committed LC Exposure pursuant to Sections 2.03(e) and 6.01 other than as
expressly provided in Section 2.03(e) or (z) any change in the obligations of
the Company under Article IX.

 

SECTION 10.06. Successors and Assigns.

 

(a) The provisions of this Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns;
provided, however, that no Account Party may assign or otherwise transfer any of
its rights or obligations under this Agreement, without the prior written
consent of the Banks.

 

(b) Any Bank may at any time grant to one or more banks or other institutions
(each a “Participant”) participating interests in its Commitment or any or all
of its Letters of Credit. In the event of any such grant by a Bank of a
participating interest to a Participant, whether or not upon notice to the
Company and the Administrative Agent, such Bank shall remain solely responsible
for the performance of its obligations hereunder, and the Account Parties and
the Administrative Agent shall continue to deal solely and directly with such
Bank in connection with such Bank’s rights and obligations under this Agreement.
Any agreement pursuant to which any Bank may grant such a participating interest
shall provide that such Bank shall retain the sole right and responsibility to
enforce the obligations of the Account Parties hereunder including, without
limitation, the right to approve any amendment, modification or waiver of any
provision of this Agreement; provided that such participation agreement may
provide that such Bank will not agree to any modification, amendment or waiver
of this Agreement described in clause (i), (ii), (iii), (iv), (x) or (y) of
Section 10.05 without the consent of the Participant. Each Account Party agrees
that each Participant shall, to the extent provided in its participation
agreement, be entitled to the benefits of Article VIII with respect to its

 

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participating interest. An assignment or other transfer which is not permitted
by subsection (c) or (d) below shall be given effect for purposes of this
Agreement only to the extent of a participating interest granted in accordance
with this subsection (b).

 

(c) Any Bank may at any time assign to one or more NAIC Approved Banks (each an
“Assignee”) all, or a proportionate part of all, of its rights and obligations
under this Agreement, and such Assignee shall assume such rights and
obligations, pursuant to an Assignment and Assumption executed by such Assignee
and such transferor Bank, with (and subject to) the consent of the Company,
which shall not be unreasonably withheld, and the Administrative Agent, which
shall not be unreasonably withheld; provided that (i) if an Assignee is an
Affiliate of any Bank or was a Bank immediately prior to such assignment, no
such consent of the Company shall be required and (ii) if an Assignee was a Bank
immediately prior to such assignment, no such consent of the Administrative
Agent shall be required; provided, further, that if an Event of Default occurs
and is continuing under Section 6.01(a), 6.01(g) or 6.01(h) with respect to the
Company, no such consent of the Company shall be required; provided, further,
that such assignment may, but need not, include rights and/or obligations of the
transferor Bank in respect of outstanding Alternative Currency Letters of
Credit; and provided, further, that any such assignment (other than an
assignment to another Bank or an Affiliate of any Bank or an assignment of the
entire remaining amount of the transferor Bank’s Commitment and interests in
outstanding Letters of Credit (other than Alternative Currency Letters of
Credit)) shall be in an amount that is at least $5,000,000 unless otherwise
agreed by the Account Parties and the Administrative Agent. Upon execution and
delivery of such Assignment and Assumption and payment by such Assignee to such
transferor Bank of an amount equal to the purchase price agreed between such
transferor Bank and such Assignee, such Assignee shall be a Bank party to this
Agreement and shall have all the rights and obligations of a Bank with a
Commitment as set forth in such instrument of assumption, and the transferor
Bank shall be released from its obligations hereunder to a corresponding extent,
and no further consent or action by any party shall be required. In connection
with any such assignment, the transferor Bank or Assignee shall pay to the
Administrative Agent an administrative fee for processing such assignment in the
amount of $3,500. If the Assignee is not incorporated under the laws of the
United States of America or a state thereof, it shall, prior to the first date
on which interest or fees are payable hereunder for its account, deliver to the
Company and the Administrative Agent certification as to exemption from
deduction or withholding of any United States federal income taxes in accordance
with Section 8.02(d).

 

(d) Any Bank may at any time assign all or any portion of its rights under this
Agreement to any Person to secure obligations of such Bank, including, without
limitation, to one or more of the Federal Reserve Banks which comprise the
Federal Reserve System. No such assignment shall release the transferor Bank
from its obligations hereunder.

 

(e) No Assignee, Participant or other transferee of any Bank’s rights shall be
entitled to receive any greater payment under Section 8.01 or 8.02 than such
Bank would have been entitled to receive with respect to the rights transferred,
unless such transfer is made (i) with the Company’s prior written consent or by
reason of the provisions of Section 8.01 or 8.02 requiring such Bank to
designate a different Applicable Credit Office under certain

 

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circumstances or (ii) at a time when the circumstances giving rise to such
greater payment did not exist.

 

SECTION 10.07. Collateral. Each of the Banks represents to the Administrative
Agent and each of the other Banks that it in good faith is not relying upon any
“margin stock” (as defined in Regulation U) as collateral in the extension or
maintenance of the credit provided for in this Agreement.

 

SECTION 10.08. New York Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York.

 

SECTION 10.09. Judicial Proceedings.

 

(a) Submission to Jurisdiction. Each Account Party hereby submits to the
nonexclusive jurisdiction of the United States District Court for the Southern
District of New York and of any New York State court sitting in New York City
for purposes of all legal proceedings arising out of or relating to this
Agreement or the transactions contemplated hereby. Each Account Party
irrevocably waives, to the fullest extent permitted by law, any objection which
it may now or hereafter have to the laying of the venue of any such proceeding
brought in such a court and any claim that any such proceeding brought in such a
court has been brought in an inconvenient forum.

 

(b) Appointment of Agent for Service of Process. Each Subsidiary Account Party
irrevocably designates and appoints CT Corporation System, at its office in New
York City, New York, U.S.A., as its authorized agent, to accept and acknowledge
on its behalf, service of any and all process which may be served in any suit,
action or proceeding of the nature referred to in Section 10.09(a) above in any
federal or New York State court sitting in New York City. Each Subsidiary
Account Party represents and warrants that such agent has agreed in writing to
accept such appointment and that a true copy of such designation and acceptance
has been delivered to the Administrative Agent. Said designation and appointment
shall be irrevocable by each such Subsidiary Account Party until all
reimbursement obligations, interest thereon and all other amounts payable
hereunder shall have been paid in full in accordance with the provisions hereof
and thereof or, if earlier, when such Subsidiary Account Party is terminated as
an Account Party hereunder pursuant to Section 10.13. If such agent shall cease
so to act, each such Subsidiary Account Party covenants and agrees to designate
irrevocably and appoint without delay another such agent satisfactory to the
Administrative Agent and to deliver promptly to the Administrative Agent
evidence in writing of such other agent’s acceptance of such appointment.

 

(c) Service of Process. Each Account Party hereby consents to process being
served in any suit, action or proceeding of the nature referred to in subsection
(a) above in any federal or New York State court sitting in New York City by
service of process upon its agent appointed as provided in subsection (b) above;
provided that, to the extent lawful and possible, notice of said service upon
such agent shall be mailed by registered or certified air mail, postage prepaid,
return receipt requested, to such Account Party at its address specified on the
signature page hereof (or, in the case of any Subsidiary Account Party, on the
signature page of the

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

Subsidiary Joinder Agreement to which it is a party) or to any other address of
which such Account Party shall have given written notice to the applicable Bank.
Each Account Party irrevocably waives, to the fullest extent permitted by law,
all claim of error by reason of any such service in such manner and agrees that
such service shall be deemed in every respect effective service of process upon
such Account Party in any such suit, action or proceeding and shall, to the
fullest extent permitted by law, be taken and held to be valid and personal
service upon and personal delivery to such Account Party.

 

(d) No Limitation on Service or Suit. Nothing in this Section shall affect the
right of the Administrative Agent or any Bank to serve process in any other
manner permitted by law or limit the right of the Administrative Agent or any
Bank to bring proceedings against any Account Party in the courts of any
jurisdiction or jurisdictions.

 

SECTION 10.10. Counterparts; Integration. This Agreement may be signed in any
number of counterparts, each of which shall be an original, with the same effect
as if the signatures thereto and hereto were upon the same instrument. This
Agreement constitutes the entire agreement and understanding among the parties
hereto and supersedes any and all prior agreements and understandings, oral or
written, relating to the subject matter hereof.

 

SECTION 10.11. Confidentiality. The Administrative Agent and each Bank agree
that they will maintain the confidentiality of, and will not use for any purpose
(other than exercising its rights and enforcing its remedies hereunder), any
written or oral information provided under this Agreement by or on behalf of the
Account Parties (hereinafter collectively called “Confidential Information”),
subject to the Administrative Agent’s and each Bank’s (a) obligation to disclose
any such Confidential Information pursuant to a request or order under
applicable laws and regulations or pursuant to a subpoena or other legal
process, (b) right to disclose any such Confidential Information to its bank
examiners, auditors, counsel and other professional advisors and to other Banks
and to its subsidiaries and Affiliates and the subsidiaries and Affiliates of
its holding company, provided that the Administrative Agent or such Bank, as the
case may be, shall cause each such subsidiary or Affiliate to maintain the
Confidential Information on the same terms as the terms provided herein, (c)
right to disclose any such Confidential Information in connection with any
litigation or dispute involving the Banks and the Company or any of its
Subsidiaries and Affiliates and (d) right to provide such information to
participants, prospective participants or prospective assignees pursuant to
Section 10.06 or to such its prospective Confirming Bank or Confirming Bank if
prior thereto such participant, prospective participant, prospective assignee,
prospective Confirming Bank or Confirming Bank agrees in writing to maintain the
confidentiality of such information on terms substantially similar to those of
this Section as if it were a “Bank” party hereto. Notwithstanding the foregoing,
any such information supplied to a Bank, participant, prospective participant,
prospective assignee, prospective Confirming Bank or Confirming Bank under this
Agreement shall cease to be Confidential Information if it is or becomes known
to such Person by other than unauthorized disclosure, or if it is, at the time
of disclosure, or becomes a matter of public knowledge. Notwithstanding anything
herein to the contrary, any party subject to confidentiality obligations
hereunder or under any other related document (and any employee, representative
or other agent of any such party) may disclose to any and all Persons, without
limitation of any kind, such party’s U.S. federal income tax treatment and the
U.S. federal income tax structure of

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

the transactions contemplated herein relating to such party and all materials of
any kind (including opinions or other tax analyses) that are provided to it
relating to such tax treatment and tax structure. However, no such party shall
disclose any information relating to such tax treatment or tax structure to the
extent nondisclosure is reasonably necessary in order to comply with applicable
securities laws.

 

SECTION 10.12. WAIVER OF JURY TRIAL. EACH OF THE ACCOUNT PARTIES, THE
ADMINISTRATIVE AGENT AND THE BANKS HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT
TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT, THE NOTES OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

SECTION 10.13. Joinder and Termination of Subsidiary Account Party.

 

(a) Any direct or indirect wholly-owned Subsidiary of the Company that is
organized, licensed or regulated under applicable law as an insurance or
reinsurance company may, with the consent of the Company, become a party to this
Agreement as an Account Party by delivering an executed Subsidiary Joinder
Agreement, substantially in the form of Exhibit C hereto, to the Administrative
Agent for acceptance by it (which shall promptly notify the Banks), provided
that on and as of the date of acceptance of such Subsidiary Joinder Agreement by
the Administrative Agent (i) no Default shall have occurred and be continuing,
(ii) each of the representations and warranties contained in this Agreement
(other than the representations and warranties set forth in Sections 4.04(e) and
4.05 as to any matter which has theretofore been disclosed in writing by the
Account Parties to the Banks) shall be true with the same force and effect as if
made on and as of such date (or, if any such representation or warranty is
expressly stated to have been made as of a specific date, as of such specific
date) and (iii) the Administrative Agent shall have received, in respect of such
proposed Subsidiary Account Party, a process agent acceptance letter
substantially in the form of Exhibit F hereto and such other documents as the
Administrative Agent shall reasonably request, which may include opinions of
counsel and other documents that are consistent with conditions set forth in
Section 3.02, each in form and substance satisfactory to the Administrative
Agent.

 

(b) The Company may, at any time at which a Subsidiary Account Party shall not
be an Account Party with respect to an outstanding Letter of Credit and which
shall have no unpaid LC Disbursements or unpaid interest on any LC
Disbursements, terminate such Subsidiary Account Party as an Account Party
hereunder by delivering an executed notice thereof, substantially in the form of
Exhibit H hereto, to the Administrative Agent (which shall promptly notify the
Banks). Immediately upon the receipt by the Administrative Agent of such notice,
all commitments of the Banks to issue Letters of Credit for account of such
Subsidiary Account Party and all rights of such Subsidiary Account Party
hereunder, shall terminate and such Subsidiary Account Party shall immediately
cease to be an Account Party hereunder; provided that all obligations of such
Subsidiary Account Party as an Account Party hereunder arising in respect of any
period in which such Subsidiary Account Party was, or on account of any action
or inaction by such Subsidiary Account Party as, an Account Party hereunder
shall survive such termination.

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

SECTION 10.14. Judgment Currency. If for the purposes of enforcing the
obligations of any Account Party hereunder it is necessary to convert a sum due
from such Person in the currency in which the relevant payment is due (the
“Required Currency”) into another currency (the “Other Currency”), the parties
hereto agree, to the fullest extent that they may effectively do so, that the
rate of exchange used shall be that at which in accordance with normal banking
procedures the Administrative Agent and the Banks could purchase the Required
Currency with the Other Currency at or about 11:00 a.m. (New York City time) on
the Business Day preceding that on which final judgment is given. The
obligations in respect of any sum due to the Administrative Agent and the Banks
hereunder shall, notwithstanding any adjudication expressed in the Other
Currency, be discharged only to the extent that on the Business Day following
receipt by the Administrative Agent and the Banks of any sum adjudged to be so
due in the Other Currency the Administrative Agent and the Banks may in
accordance with normal banking procedures purchase the Required Currency with
the Other Currency; if the amount of the Required Currency so purchased is less
than the sum originally due to the Administrative Agent and the Banks in the
Required Currency, the Company agrees, to the fullest extent that it may
effectively do so, as a separate obligation and notwithstanding any such
adjudication, to indemnify the Administrative Agent and the Banks against such
loss, and if the amount of the Required Currency so purchased exceeds the sum
originally due to the Administrative Agent and the Banks, they shall remit such
excess to the applicable Account Party.

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective authorized officers as of the day and year first
above written.

 

LINCOLN NATIONAL CORPORATION

By:    

Name:

   

Title:

    By:    

Name:

   

Title:

   

Centre Square, West Tower

1500 Market Street, Suite 3900

Philadelphia, PA 19102-2112

Attention: Treasurer’s Office

Tel: (215) 448-1435

Fax: (215) 448-3954

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

SUBSIDIARY ACCOUNT PARTIES

 

LINCOLN NATIONAL REINSURANCE

COMPANY (BARBADOS) LIMITED

By:    

Name:

   

Title:

    THE LINCOLN NATIONAL LIFE INSURANCE COMPANY By:    

Name:

   

Title:

   

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

BANKS

JPMORGAN CHASE BANK,

Individually and as Administrative Agent

By:    

Name:

   

Title:

   

Address for Notices (for the Administrative Agent):

JPMorgan Chase Bank

10420 Highland Manor Drive

4th Floor

Tampa, Florida 33610

Attention:

 

Standby Letter of Credit Department

   

Mumta Dayal

Tel:     (813) 432-6358

Fax:     (813) 432-5162

with copies to:

JPMorgan Chase Bank

1111 Fannin Street

10th Floor

Houston, Texas 77002-8069

Attention:

 

Loan and Agency Department

   

Carla Kinney

Tel:     (713) 750-3560

Fax:     (713) 750-2223

and:

JPMorgan Chase Bank

270 Park Avenue

4th Floor

New York, NY 10017

Attention:

 

Heather Lindstrom

Tel:     (212) 270-9839

Fax:     (212) 270-1511

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

THE BANK OF NEW YORK By:    

Name:

   

Title:

   

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

CITICORP USA, INC. By:    

Name:

   

Title:

   

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

MELLON BANK, N.A. By:    

Name:

   

Title:

   

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

WACHOVIA BANK, NATIONAL ASSOCIATION By:    

Name:

   

Title:

   

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

KEY BANK NATIONAL ASSOCIATION By:    

Name:

   

Title:

   

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

ABN AMRO BANK N.V. By:    

Name:

   

Title:

   

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

BANK ONE, NA By:    

Name:

   

Title:

   

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

FLEET NATIONAL BANK By:    

Name:

   

Title:

   

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

HSBC BANK USA By:    

Name:

   

Title:

   

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

THE BANK OF TOKYO-MITSUBISHI, LTD. By:    

Name:

   

Title:

   

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

THE NORTHERN TRUST COMPANY By:    

Name:

   

Title:

   

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

WELLS FARGO BANK, NATIONAL ASSOCIATION

By:    

Name:

   

Title:

   

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

US BANK NATIONAL ASSOCIATION

By:    

Name:

   

Title:

   

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

BANK OF AMERICA, N.A.

By:    

Name:

   

Title:

   

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

FIFTH THIRD BANK

By:    

Name:

   

Title:

   

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

NORDDEUTSCHE LANDESBANK GIROZENTRALE

By:    

Name:

   

Title:

   

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

PNC BANK, NATIONAL ASSOCIATION

By:    

Name:

   

Title:

   

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

SOCIETE GENERALE

By:    

Name:

   

Title:

   

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

THE BANK OF NOVA SCOTIA

By:    

Name:

   

Title:

   

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

NATIONAL CITY BANK

By:    

Name:

   

Title:

   

 

Third Amended and Restated Letter of Credit and Reimbursement Agreement

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

SCHEDULE I

 

Commitments

(As of December 11, 2003)

 

Bank

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

   Commitment ($)

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

JPMorgan Chase Bank

     44,000,000

The Bank of New York

     36,666,667

Citicorp USA, Inc.

     36,666,667

Mellon Bank, N.A.

     36,666,667

Wachovia Bank, National Association

     36,666,667

Key Bank National Association

     36,666,667

ABN AMRO Bank N.V.

     27,500,000

Bank One, NA

     27,500,000

Fleet National Bank

     27,500,000

HSBC Bank USA

     27,500,000

The Bank of Tokyo-Mitsubishi, Ltd.

     27,500,000

The Northern Trust Company

     27,500,000

Wells Fargo Bank, National Association

     27,500,000

US Bank National Association

     27,500,000

Bank of America, N.A.

     14,666,667

Fifth Third Bank

     14,666,667

Norddeutsche Landesbank Girozentrale

     14,666,667

PNC Bank, National Association

     14,666,667

Societe Generale

     14,666,667

The Bank of Nova Scotia

     14,666,667

National City Bank

     14,666,667

Total Commitments

   $ 550,000,000

 

Schedule I (Commitments)

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

SCHEDULE II

 

List of Restricted Subsidiaries

 

Lincoln National Life Insurance Company

 

Schedule II (Restricted Subsidiaries)

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

EXHIBIT A

 

Form of Assignment and Assumption

 

ASSIGNMENT AND ASSUMPTION

 

This Assignment and Assumption (the “Assignment and Assumption”) is dated as of
the Effective Date set forth below and is entered into by and between [Insert
name of Assignor] (the “Assignor”) and [Insert name of Assignee] (the
“Assignee”). Capitalized terms used but not defined herein shall have the
meanings given to them in the Credit Agreement identified below (as amended, the
“Credit Agreement”), receipt of a copy of which is hereby acknowledged by the
Assignee. The Standard Terms and Conditions set forth in Annex 1 attached hereto
are hereby agreed to and incorporated herein by reference and made a part of
this Assignment and Assumption as if set forth herein in full.

 

For an agreed consideration, the Assignor hereby irrevocably sells and assigns
to the Assignee, and the Assignee hereby irrevocably purchases and assumes from
the Assignor, subject to and in accordance with the Standard Terms and
Conditions and the Credit Agreement, as of the Effective Date inserted by the
Administrative Agent as contemplated below (i) all of the Assignor’s rights and
obligations in its capacity as a Bank under the Credit Agreement and any other
documents or instruments delivered pursuant thereto to the extent related to the
amount and percentage interest identified below of all of such outstanding
rights and obligations of the Assignor under the facility identified below and
(ii) to the extent permitted to be assigned under applicable law, all claims,
suits, causes of action and any other right of the Assignor (in its capacity as
a Bank) against any Person, whether known or unknown, arising under or in
connection with the Credit Agreement, any other documents or instruments
delivered pursuant thereto or the credit transactions governed thereby or in any
way based on or related to any of the foregoing, including contract claims, tort
claims, malpractice claims, statutory claims and all other claims at law or in
equity related to the rights and obligations sold and assigned pursuant to
clause (i) above (the rights and obligations sold and assigned pursuant to
clauses (i) and (ii) above being referred to herein collectively as the
“Assigned Interest”). Such sale and assignment is without recourse to the
Assignor and, except as expressly provided in this Assignment and Assumption,
without representation or warranty by the Assignor.

 

1.    Assignor:    ____________________________ 2.    Assignee:   
____________________________           [and is an Affiliate of [identify Bank]]
3.    Account Party:    [                    ] 4.    Administrative Agent:   
JPMorgan Chase Bank, as the administrative agent under the Credit Agreement

 

Exhibit A (Assignment and Assumption)

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

5.    Credit Agreement:    The $550,000,000 Third Amended and Restated Letter of
Credit and Reimbursement Agreement dated as of December 11, 2003 between Lincoln
National Corporation, the Subsidiary Account Parties party thereto, the Banks
party thereto and JPMorgan Chase Bank, as Administrative Agent 6.    Assigned
Interest:     

 

Facility Assigned1

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

  

Aggregate Amount of Commitment/
LC Exposure for all Banks

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

  

Amount of Commitment/LC
Exposure Assigned

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

  

Percentage Assigned of
Commitment/LC Exposure2

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

     $    $    %      $    $    %      $    $    %

 

Effective Date:                              , 200   [TO BE INSERTED BY
ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF
TRANSFER IN THE REGISTER THEREFOR.]

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

1 Fill in the appropriate terminology for the types of facilities under the
Credit Agreement that are being assigned under this Assignment (e.g. “Revolving
Commitment,” “Term Loan Commitment,” etc.).

 

2 Set forth, to at least 9 decimals, as a percentage of the Commitment/LC
Exposure of all Banks thereunder.

 

Exhibit A (Assignment and Assumption)

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

The terms set forth in this Assignment and Assumption are hereby agreed to:

 

ASSIGNOR [NAME OF ASSIGNOR] By:    

Name:

   

Title:

    ASSIGNEE [NAME OF ASSIGNEE] By:    

Name:

   

Title:

   

 

Exhibit A (Assignment and Assumption)

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

[Consented to and]3 Accepted:

JPMORGAN CHASE BANK, as Administrative Agent

By:    

Name:

   

Title:

   

[Consented to and]4

LINCOLN NATIONAL CORPORATION

By:    

Name:

   

Title:

   

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

3 To be added only if the consent of the Administrative Agent is required by the
terms of the Credit Agreement.

 

4 To be added only if the consent of the Company is required by the terms of the
Credit Agreement.

 

Exhibit A (Assignment and Assumption)

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

ANNEX 1

 

STANDARD TERMS AND CONDITIONS FOR

 

ASSIGNMENT AND ASSUMPTION

 

1. Representations and Warranties.

 

1.1 Assignor. The Assignor (a) represents and warrants that (i) it is the legal
and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is
free and clear of any lien, encumbrance or other adverse claim and (iii) it has
full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby; and (b) assumes no responsibility with respect to (i) any
statements, warranties or representations made in or in connection with the
Credit Agreement, (ii) the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Credit Agreement or any collateral
thereunder, (iii) the financial condition of the Company, any of its
Subsidiaries or Affiliates or any other Person obligated in respect of the
Credit Agreement or (iv) the performance or observance by the Company, any of
its Subsidiaries or Affiliates or any other Person of any of their respective
obligations under the Credit Agreement.

 

1.2. Assignee. The Assignee (a) represents and warrants that (i) it has full
power and authority, and has taken all action necessary, to execute and deliver
this Assignment and Assumption and to consummate the transactions contemplated
hereby and to become a Bank under the Credit Agreement, (ii) it satisfies the
requirements, if any, specified in the Credit Agreement that are required to be
satisfied by it in order to acquire the Assigned Interest and become a Bank,
(iii) from and after the Effective Date, it shall be bound by the provisions of
the Credit Agreement as a Bank thereunder and, to the extent of the Assigned
Interest, shall have the obligations of a Bank thereunder, (iv) it has received
a copy of the Credit Agreement, together with copies of the most recent
financial statements delivered pursuant to Section 5.01 thereof, as applicable,
and such other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into this Assignment and
Assumption and to purchase the Assigned Interest on the basis of which it has
made such analysis and decision independently and without reliance on the
Administrative Agent or any other Bank, and (v) if it is a Bank that is not
incorporated under the laws of the United States of America or any state
thereof, attached to the Assignment and Assumption is any documentation required
to be delivered by it pursuant to the terms of the Credit Agreement, duly
completed and executed by the Assignee; and (b) agrees that (i) it will,
independently and without reliance on the Administrative Agent, the Assignor or
any other Bank, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Credit Agreement, and (ii) it will perform in
accordance with their terms all of the obligations which by the terms of the
Credit Agreement are required to be performed by it as a Bank.

 

2. Payments. From and after the Effective Date, the Administrative Agent shall
make all payments in respect of the Assigned Interest (including payments of
reimbursement obligations, interest, fees and other amounts) to the Assignor for
amounts which have accrued to

 

Annex I

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

but excluding the Effective Date and to the Assignee for amounts which have
accrued from and after the Effective Date.

 

3. General Provisions. This Assignment and Assumption shall be binding upon, and
inure to the benefit of, the parties hereto and their respective successors and
assigns. This Assignment and Assumption may be executed in any number of
counterparts, which together shall constitute one instrument. Delivery of an
executed counterpart of a signature page of this Assignment and Assumption by
telecopy shall be effective as delivery of a manually executed counterpart of
this Assignment and Assumption. This Assignment and Assumption shall be governed
by, and construed in accordance with, the law of the State of New York.

 

Annex I

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

EXHIBIT B

 

[Form of Confirming Bank Agreement]

 

[Letterhead of Issuing Bank]

 

                    , 20    

 

[Name of Confirming Bank]

[Address]

 

Ladies and Gentlemen:

 

Reference is made to the Third Amended and Restated Letter of Credit and
Reimbursement Agreement dated as of December 11, 2003 (as amended, restated,
supplemented and otherwise modified and in effect on the date hereof, the
“Credit Agreement”), among Lincoln National Corporation, the Subsidiary Account
Parties party thereto, the Banks party thereto, and JPMorgan Chase Bank, as
Administrative Agent for the Banks. Terms defined in the Credit Agreement are
used herein with the same meanings.

 

The undersigned is an Issuing Bank under the Credit Agreement but is not on the
date hereof a bank listed on the most current Bank List of banks approved by the
NAIC. Accordingly, in order to be an “NAIC Bank” for the purposes of the Credit
Agreement, the undersigned hereby requests that you be a Confirming Bank with
respect to the undersigned for the purposes of the Credit Agreement and each
Letter of Credit issued thereunder.

 

By your signature below, you undertake that any draft drawn under and in strict
compliance with the terms of any Letter of Credit issued under the Credit
Agreement will be duly honored by you as if, and to the extent, you were the
Issuing Bank under such Letter of Credit. Notwithstanding the foregoing, your
liability under all Letters of Credit at any one time issued under the Credit
Agreement shall be limited to an amount (the “Liability Limit”) equal to the
Commitment of the undersigned under the Credit Agreement in effect on the date
hereof (an amount equal to $            ), as such Liability Limit may be
increased after the date hereof with your prior written consent by reason of an
increase in the Commitment of the undersigned under the Credit Agreement. In
addition, you hereby irrevocably appoint and designate the Administrative Agent
as your attorney-in-fact, acting through any duly authorized officer of JPMCB,
to execute and deliver, at any time prior to the Commitment Termination Date in
effect on the date of this letter agreement, in your name and on your behalf
each Letter of Credit to be confirmed by you in accordance herewith and with the
Credit Agreement. You agree that, promptly upon the request of the
Administrative Agent, you will furnish to the Administrative Agent such powers
of attorney or other evidence as any beneficiary of any Letter of Credit may

 

Exhibit B (Confirming Bank Agreement)

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

reasonably request in order to demonstrate that the Administrative Agent has the
power to act as attorney-in-fact for you in connection with the execution and
delivery of such Letter of Credit.

 

In consideration of the foregoing, the undersigned agrees that if you shall make
any LC Disbursement in respect of any Letter of Credit, regardless of the
identity of the account party of such Letter of Credit, the undersigned shall
reimburse you by paying to you an amount equal to the amount of the LC
Disbursement made by you, such payment to be made not later than noon, New York
City time, on (i) the Business Day that the undersigned receives notice of such
LC Disbursement, if such notice is received prior to 10:00 a.m., New York City
time, or (ii) the Business Day immediately following the day that the
undersigned receives such notice, if such notice is received on a day which is
not a Business Day or is not received prior to 10:00 a.m., New York City time,
on a Business Day. The undersigned’s obligations to reimburse you as provided in
the foregoing sentence shall be absolute, unconditional and irrevocable, and
shall be performed strictly in accordance with the terms of this letter
agreement under any and all circumstances whatsoever, and irrespective of any
event or circumstance of the type described in Section 2.04(b) of the Credit
Agreement (or of any analogous event or circumstance relating to the
undersigned).

 

If any LC Disbursement is made by you, then, unless the undersigned shall
reimburse the amount of such LC Disbursement to you in full on the date such LC
Disbursement is made by you, the unpaid amount thereof shall bear interest, for
each day from and including the date such LC Disbursement is made to but
excluding the date of reimbursement, at the rate per annum equal to (i) the
Federal Funds Effective Rate to but excluding the date three Business Days after
such LC Disbursement and (ii) from and including the date three Business Days
after such LC Disbursement, 2% plus the Federal Funds Effective Rate.

 

This letter agreement shall be governed by and construed in accordance with the
law of the State of New York.

 

Exhibit B (Confirming Bank Agreement)

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

Please indicate your acceptance of the foregoing terms and conditions by signing
the three enclosed copies of this letter agreement and returning (a) one such
signed copy to the undersigned at the address indicated above, (b) one such
signed copy to the Administrative Agent at JPMorgan Chase Bank, 1111 Fannin
Street, 10th Floor, Houston, Texas 77002-8069, Attention Loan and Agency
Department (Telecopy No. (212) 750-2223) and (c) one such signed copy to the
Company at its address specified in Section 10.01 of the Credit Agreement.

 

[NAME OF ISSUING BANK]

By    

Title:

   

 

AGREED AS AFORESAID:

[NAME OF CONFIRMING BANK]

By    

Title:

   

 

Exhibit B (Confirming Bank Agreement)

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EXHIBIT C

 

[Form of Subsidiary Joinder Agreement]

 

[                    ], 200[  ]

 

To JPMorgan Chase Bank,

as Administrative Agent

270 Park Avenue

New York, New York 10017

 

Each of the Banks party to the

Credit Agreement referred to below

 

  Re: Subsidiary Joinder Agreement

 

Ladies and Gentlemen:

 

Reference is made to the Third Amended and Restated Letter of Credit and
Reimbursement Agreement (the “Credit Agreement”) dated as of December 11, 2003
among Lincoln National Corporation (the “Company”), the Subsidiary Account
Parties party thereto, the Banks party thereto and JPMorgan Chase Bank, as the
Administrative Agent (the “Administrative Agent”). Capitalized terms used but
not defined herein shall have the respective meanings assigned to such terms in
the Credit Agreement.

 

The Company and the “Subject Subsidiary” (as identified on the signature pages
below), have executed and hereby deliver this Subsidiary Joinder Agreement,
pursuant to Section 10.13(a) of the Credit Agreement, in order to designate the
Subject Subsidiary as a Subsidiary Account Party to the Credit Agreement.

 

Accordingly, the Company and the Subject Subsidiary hereby represent and warrant
and agree that as of the “Effective Date” (as defined below):

 

1. the Subject Subsidiary is a direct or indirect wholly-owned Subsidiary of the
Company;

 

2. the Subject Subsidiary is subject to and bound by each of the obligations, of
an Account Party, including a Subsidiary Account Party, contained in the Credit
Agreement as if the Subject Subsidiary were an original signatory to such Credit
Agreement;

 

3. each of the representations and warranties contained in the Credit Agreement
(other than the representations and warranties set forth in Sections 4.04(e) and
4.05 thereof as to any matter which has theretofore been disclosed in writing by
the Account Parties to the Banks) are true with the same force and effect as if
made on and as of the

 

Exhibit C (Subsidiary Joinder Agreement)

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Effective Date (or, if any such representation or warranty is expressly stated
to have been made as of a specific date, as of such specific date);

 

4. the Guarantee of the Company contained in Article IX of the Credit Agreement
applies to all of the obligations of the Subject Subsidiary pursuant thereto;

 

5. the Subject Subsidiary’s addresses for notices, other communications and
service of process provided for in the Credit Agreement shall be given in the
manner, and with the effect, specified in Sections 10.01 and 10.09(c) of the
Credit Agreement to it at its “Address for Notices” specified on the signature
pages below; and

 

6. the Subject Subsidiary shall deliver to the Administrative Agent a process
agent acceptance letter substantially in the form of Exhibit F to the Credit
Agreement and such other documents as the Administrative Agent shall reasonably
request, including opinions of counsel and other documents that are consistent
with conditions set forth in Section 3.02 of the Credit Agreement, each in form
and substance satisfactory to the Administrative Agent.

 

This Subsidiary Joinder Agreement shall become effective as of the date (the
“Effective Date”) on which the Administrative Agent accepts this Subsidiary
Joinder Agreement as provided on the signature pages below. As of the Effective
Date, the Subject Subsidiary shall be entitled to the rights, and subject to the
obligations, of an Account Party, including a Subsidiary Account Party,
contained in the Credit Agreement. Except as expressly herein agreed with
respect to the joinder of the Subject Subsidiary as a Subsidiary Account Party,
the Credit Agreement shall remain unchanged and in full force and effect.

 

This Subsidiary Joinder Agreement may be executed in any number of counterparts,
all of which taken together shall constitute one and the same agreement. This
Subsidiary Joinder Agreement shall be governed by, and construed in accordance
with, the law of the State of New York.

 

Exhibit C (Subsidiary Joinder Agreement)

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COMPANY

LINCOLN NATIONAL CORPORATION

By:    

Name:

   

Title:

   

SUBJECT SUBSIDIARY

[                                         ]

a [                                    ] [corporation]

By:    

Name:

   

Title:

   

Address for Notices

[                                         ]

[                                         ]

[                                         ]

Attn:                                         

Tel:[                                ] Fax:[                                ]

 

Agreed and Accepted: this [            ] [th] day of

[                    ], 200[  ]

JPMORGAN CHASE BANK, as Administrative Agent

By:    

Name:

   

Title

   

 

Exhibit C (Subsidiary Joinder Agreement)

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EXHIBIT D

 

OPINION OF GENERAL

COUNSEL OF THE COMPANY

 

December 11, 2003

 

To the Banks and the Administrative Agent

    referred to below

c/o JPMorgan Chase Bank,

as Administrative Agent

270 Park Avenue

New York, NY 10017

 

Dear Sirs:

 

I refer to the Third Amended and Restated Letter of Credit and Reimbursement
Agreement (the “Credit Agreement”) dated as of December 11, 2003 among Lincoln
National Corporation (the “Company”), and the Subsidiary Account Parties party
thereto, the Banks party thereto and the Administrative Agent. Terms defined in
the Credit Agreement are used herein as therein defined. I am General Counsel of
the Company and am admitted to practice law in the State of Indiana. This
opinion is being rendered to you at the request of the Company.

 

I have examined originals or copies, certified or otherwise identified to my
satisfaction, of such documents, corporate records, certificates of public
officials and other instruments, and have conducted such other investigations of
fact and law, as I have deemed necessary or advisable for purposes of this
opinion. I have also assumed that the Credit Agreement has been duly authorized,
executed and delivered by each of the Banks referred to therein and the
Administrative Agent and is enforceable in accordance with its terms against
such parties. As to certain matters of fact, I have relied upon information
obtained from officers and employees of the Company and from public officials
believed by me to be responsible.

 

Upon the basis of the foregoing, I am of the opinion that:

 

  1. The Company is a corporation duly incorporated and validly existing under
the laws of the State of Indiana, and has all corporate powers and all material
governmental licenses, authorizations, consents and approvals required to carry
on its business as now conducted. The Company is duly qualified to do business,
and is in good standing, in every other jurisdiction where such qualification is
required.

 

  2.

The execution, delivery and performance by the Company of the Credit Agreement
are within the Company’s corporate power, have been duly authorized by all
necessary corporate action, require no action by or in respect of, or filing

 

Exhibit D (Opinion of General Counsel)

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with, any governmental body, agency or official and do not contravene, or
constitute a default under, any provision of applicable law or regulation or of
the articles of incorporation or by-laws of the Company or of any material
agreement, injunction, order, decree or other instrument binding upon the
Company or any of its Restricted Subsidiaries or result in the creation or
imposition of any Lien on any asset of the Company or any of its Restricted
Subsidiaries.

 

  3. The Credit Agreement has been duly executed and delivered by the Company.

 

  4. If the Credit Agreement were stated to be governed by and construed in
accordance with the law of the State of Indiana or if a court of the State of
Indiana were to apply the law of the State of Indiana to the Credit Agreement,
the Credit Agreement would constitute a valid and binding agreement of the
Company enforceable in accordance with its terms.

 

  5. There is no action, suit or proceeding pending against or, to the best of
my knowledge after reasonable inquiry, threatened, against the Company or any of
its Subsidiaries before any court or arbitrator or any governmental body, agency
or official (a) in which there is a reasonable possibility of an adverse
decision in an amount in excess of $100,000,000 which could materially adversely
affect the business, financial position or results of operations of the Company
and its Consolidated Subsidiaries, considered as a whole, or (b) which in any
manner draws into question the validity or enforceability of the Credit
Agreement.

 

  6. Each of the Company’s Restricted Subsidiaries is a corporation validly
existing under the laws of its jurisdiction of incorporation, and has all
corporate powers and all material governmental licenses, authorizations,
consents and approvals required to carry on its business as now conducted.

 

The foregoing opinions are subject to the following comments and qualifications:

 

(A) The opinions set forth in paragraph 4 above are subject to the qualification
that the binding effect and enforceability of the Credit Agreement may be
limited by (i) bankruptcy, insolvency, reorganization, moratorium or other
similar laws of general applicability affecting the enforcement of creditors’
rights, and (ii) the application of general principles of equity, regardless of
whether such enforceability is considered in a proceeding in equity or at law.

 

(B) The enforceability of Sections 7.06, 7.07 and 10.03 of the Credit Agreement
may be limited by laws limiting the enforceability of provisions exculpating or
exempting a party from, or requiring indemnification of a party for, liability
for its own action or inaction, to the extent the action or inaction involves
gross negligence, recklessness, willful misconduct or unlawful conduct.

 

Exhibit D (Opinion of General Counsel)

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(C) The enforceability of provisions in the Credit Agreement to the effect that
terms may not be waived or modified except in writing may be limited under
certain circumstances.

 

(D) Section 9.02 of the Credit Agreement may not be enforceable to the extent
that the obligations of any Subsidiary Account Party under the Credit Agreement
are materially modified.

 

(E) I express no opinion as to (i) the effect of the laws of any jurisdiction in
which any Bank is located (other than the State of Indiana) that limit the
interest, fees or other charges such Lender may impose for the loan or use of
money or other credit, (ii) the last sentence of Section 10.04 of the Credit
Agreement, (iii) the first sentence of Section 10.09(a) of the Credit Agreement,
insofar as such sentence relates to the subject matter jurisdiction of the
United States District Court for the Southern District of New York to adjudicate
any controversy related to the Credit Agreement, (iv) the waiver of inconvenient
forum set forth in the last sentence of Section 10.09(a) of the Credit Agreement
with respect to proceedings in the United States District Court for the Southern
District of New York and (v) Section 10.14 of the Credit Agreement.

 

(F) I wish to point out with reference to obligations stated to be payable in an
Alternative Currency that a judgment rendered by a United States Federal court
sitting in the State of Indiana in respect of an obligation denominated in an
Alternative Currency may be expressed in Dollars, but I express no opinion as to
the rate of exchange such Federal court would apply.

 

(G) I also wish to point out that provisions of the Credit Agreement which
permit the Administrative Agent or the Banks to take actions or make
determinations may be subject to a requirement that such actions be taken or
such determinations be made on a reasonable basis and in good faith.

 

I do not herein express any opinion as to any matters governed by any law other
than the law of the State of Indiana and the United States of America.

 

This opinion is rendered only with respect to law in effect as of the date
hereof. I assume no responsibility for updating this opinion to take into
account any event, action, interpretation or change of law occurring subsequent
to the date hereof which may affect the validity of any of the opinions
expressed herein.

 

This opinion is furnished by me solely for your benefit for use in connection
with the transactions contemplated by the Credit Agreement and it may not be
relied upon by any other Person.

 

Very truly yours,

  Dennis L. Schoff, Esq. General Counsel

 

Exhibit D (Opinion of General Counsel)

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EXHIBIT E

 

OPINION OF

MILBANK, TWEED, HADLEY & MCCLOY LLP,

SPECIAL NEW YORK COUNSEL TO JPMCB

 

December 11, 2003

 

To the Banks and the Administrative Agent

referred to below

c/o JPMorgan Chase Bank,

as Administrative Agent

270 Park Avenue

New York, NY 10017

 

Dear Sirs:

 

We have acted as special New York counsel to JPMorgan Chase Bank in connection
with the Third Amended and Restated Letter of Credit and Reimbursement Agreement
(the “Credit Agreement”) dated as of December 11, 2003, among Lincoln National
Corporation (the “Company”), Lincoln National Reinsurance Company (Barbados)
Limited (“LN (Barbados)”) and The Lincoln National Life Insurance Company as
Subsidiary Account Parties party thereto (the “Subsidiary Account Parties”), the
Banks party thereto and the Administrative Agent. Terms defined in the Credit
Agreement are used herein as defined therein. This opinion letter is being
delivered pursuant to Section 3.02(c) of the Credit Agreement. The Company and
the Subsidiary Account Parties party to the Credit Agreement on the date hereof
are herein referred to as the “Obligors”.

 

In rendering the opinions expressed below, we have examined an executed
counterpart of the Credit Agreement. In our examination, we have assumed the
genuineness of all signatures, the authenticity of all documents submitted to us
as originals and the conformity with authentic original documents of all
documents submitted to us as copies. When relevant facts were not independently
established, we have relied upon representations made in or pursuant to the
Credit Agreement.

 

In rendering the opinions expressed below, we have assumed, with respect to all
of the documents referred to in this opinion letter, that:

 

  (i) such documents have been duly authorized by, have been duly executed and
delivered by, and (except to the extent set forth in the opinions expressed
below as to the Obligors) constitute legal, valid, binding and enforceable
obligations of, all of the parties to such documents;

 

Exhibit E (Opinion of Milbank, Tweed, Hadley & McCloy LLP)

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  (ii) all signatories to such documents have been duly authorized;

 

  (iii) all of the parties to such documents are duly organized and validly
existing and have the power and authority (corporate or other) to execute,
deliver and perform such documents; and

 

  (iv) all authorizations, approvals or consents of (including without
limitation all foreign exchange control approvals), and all filings or
registrations with, any governmental or regulatory authority or agency of
Barbados (including the central bank of Barbados) required for the making and
performance by LN (Barbados) of the Credit Agreement have been obtained or made
and are in effect.

 

Based upon and subject to the foregoing and subject also to the comments and
qualifications set forth below, and having considered such questions of law as
we have deemed necessary as a basis for the opinions expressed below, we are of
the opinion that the Credit Agreement constitutes the legal, valid and binding
obligation of each Obligor, enforceable against such Obligor in accordance with
its terms, except as may be limited by bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance or transfer or other similar laws relating to
or affecting the rights of creditors generally and to the possible judicial
application of foreign laws or governmental action affecting the rights of
creditors generally and except as the enforceability of the Credit Agreement is
subject to the application of general principles of equity (regardless of
whether considered in a proceeding in equity or at law), including (a) the
possible unavailability of specific performance, injunctive relief or any other
equitable remedy and (b) concepts of materiality, reasonableness, good faith and
fair dealing.

 

The foregoing opinions are subject to the following comments and qualifications:

 

(A) The enforceability of Sections 7.06, 7.07 and 10.03 of the Credit Agreement
may be limited by laws limiting the enforceability of provisions exculpating or
exempting a party from, or requiring indemnification of a party for, liability
for its own action or inaction, to the extent the action or inaction involves
gross negligence, recklessness, willful misconduct or unlawful conduct.

 

(B) The enforceability of provisions in the Credit Agreement to the effect that
terms may not be waived or modified except in writing may be limited under
certain circumstances.

 

(C) Section 9.02 of the Credit Agreement may not be enforceable to the extent
that the obligations of any Subsidiary Account Party under the Credit Agreement
are materially modified.

 

(D) We express no opinion as to (i) the effect of the laws of any jurisdiction
in which any Bank is located (other than the State of New York) that limit the
interest, fees or other charges such Lender may impose for the loan or use of
money or other credit, (ii) the last sentence of Section 10.04 of the Credit
Agreement, (iii) the first sentence of Section 10.09(a) of the Credit Agreement,
insofar as such sentence relates to the subject

 

Exhibit E (Opinion of Milbank, Tweed, Hadley & McCloy LLP)

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matter jurisdiction of the United States District Court for the Southern
District of New York to adjudicate any controversy related to the Credit
Agreement, (iv) the waiver of inconvenient forum set forth in the last sentence
of Section 10.09(a) of the Credit Agreement with respect to proceedings in the
United States District Court for the Southern District of New York and (v)
Section 10.14 of the Credit Agreement.

 

(E) We wish to point out with reference to obligations stated to be payable in
an Alternative Currency that (i) a New York statute provides that a judgment
rendered by a court of the State of New York in respect of an obligation
denominated in any Alternative Currency would be rendered in such Alternative
Currency and would be converted into Dollars at the rate of exchange prevailing
on the date of entry of such judgment and (ii) a judgment rendered by a United
States Federal court sitting in the State of New York in respect of an
obligation denominated in an Alternative Currency may be expressed in Dollars,
but we express no opinion as to the rate of exchange such Federal court would
apply.

 

The foregoing opinions are limited to matters involving the Federal laws of the
United States and the law of the State of New York, and we do not express any
opinion as to the laws of any other jurisdiction.

 

At the request of our client, this opinion letter is, pursuant to Section
3.02(c) of the Credit Agreement, provided to you by us in our capacity as
special New York counsel to JPMCB and may not be relied upon by any Person other
than you or for any purpose other than in connection with the transactions
contemplated by the Credit Agreement without, in each instance, our prior
written consent.

 

Very truly yours,

 

WJM/RJW

 

Exhibit E (Opinion of Milbank, Tweed, Hadley & McCloy LLP)

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EXHIBIT F

 

[Form of Process Agent Acceptance]

 

CT Corporation System

 

[                ], 2000

 

To: JPMorgan Chase Bank (the “Administrative Agent”)

 

Ladies and Gentlemen:

 

In respect of the Third Amended and Restated Letter of Credit and Reimbursement
Agreement (the “Credit Agreement”) dated as of December 11, 2003 among Lincoln
National Corporation (the “Company”), Subsidiary Account Parties party thereto,
the Banks party thereto and the Administrative Agent, the undersigned hereby
accepts the irrevocable designation and appointment of it as of the date hereof
as agent for [                ] to accept and acknowledge service of any and all
process, as contemplated by Section 10.09(b) of the Credit Agreement and
otherwise as provided thereby, such acceptance to remain in effect until the
Credit Agreement shall have been terminated and all obligations thereunder of
[                ] shall have been paid in full.

 

The undersigned agrees to give the Administrative Agent or the Company, as
applicable, immediate notice by telephone, fax, telex, cable or any other means
of instant communication upon receipt of all papers served upon the undersigned
pursuant to such appointment and to forward promptly to the Administrative Agent
or the Company, as applicable, all such papers served pursuant to such
appointment by reputable overnight carrier.

 

Very truly yours,

CT CORPORATION SYSTEM

By:    

Title:

   

 

Exhibit F (Process Agent Acceptance)

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EXHIBIT G

 

SUBSIDIARY TERMINATION NOTICE

 

[Date]                                         

 

To: JPMorgan Chase Bank (the “Administrative Agent”)

 

From:  Lincoln National Corporation (the “Company”)

 

Re: Third Amended and Restated Letter of Credit and Reimbursement Agreement (the
“Credit Agreement”) dated as of December 11, 2003 among the Company, the
Subsidiary Account Parties party thereto, the Banks party thereto (the “Banks”)
and the Administrative Agent

 

The Company hereby gives notice pursuant to Section 10.13(b) of the Credit
Agreement that, effective as of the date hereof, [                ] is
terminated as an Account Party under the Credit Agreement and all commitments by
the Banks to issue Letters of Credit for account of such Account Party under the
Credit Agreement are hereby terminated.

 

Pursuant to Section 10.13(b) of the Credit Agreement, the Company hereby
certifies that there is no LC Exposure outstanding with respect to any Letter of
Credit with respect to which [                ] is the Account Party.

 

All obligations of [                ] arising in respect of any period in which
[                ] was, or on account of any action or inaction taken by
[                ] as, an Account Party under the Credit Agreement shall survive
the termination effected by this notice.

 

Terms used herein have the meanings assigned to them in the Credit Agreement.

 

LINCOLN NATIONAL CORPORATION By         Authorized Officer

 

Exhibit G (Subsidiary Termination Notice)