EX-10.1






Exhibit 10.1




FIRST AMENDMENT TO CREDIT AGREEMENT

($400,000,000 UNSECURED SENIOR REVOLVING CREDIT FACILITY)




This FIRST AMENDMENT TO CREDIT AGREEMENT (this “First Amendment”), is dated as of
February 25, 2010, and entered into by and among ALLIED WORLD ASSURANCE COMPANY HOLDINGS, LTD, an
exempted company incorporated in Bermuda (“Holdings”), ALLIED WORLD ASSURANCE COMPANY, LTD,
an exempted company incorporated in Bermuda (“Allied World,” and together with Holdings,
the “Borrowers”), the Lenders party hereto, and WACHOVIA BANK, NATIONAL ASSOCIATION
(“Wachovia”), as Administrative Agent, L/C Agent and Fronting Bank for the Lenders.



RECITALS




A. The Borrowers, the several lenders from time to time parties thereto (the
“Lenders”), the Administrative Agent and Bank of America, N.A., as Syndication Agent, are
party to the Credit Agreement dated as of November 27, 2007 (as amended, supplemented, restated and
modified from time to time, the “Unsecured Credit Agreement”). Capitalized terms used
herein without definition shall have the meanings given to them in the Unsecured Credit Agreement.



B. The Borrowers have requested certain amendments to the Unsecured Credit Agreement and the
Administrative Agent and the Required Lenders have agreed to make such amendments on the terms and
conditions set forth herein.



STATEMENT OF AGREEMENT




NOW, THEREFORE, in consideration of the foregoing and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:



ARTICLE I

AMENDMENTS TO CREDIT AGREEMENT




1.1 Amendments to Section 1.1 (Defined Terms).



(a) The following definitions are hereby added to Section 1.1 of the Unsecured Credit
Agreement in appropriate alphabetical order:



“Designated Lender” means any Lender that is either a Defaulting Lender
or a Downgraded Lender.



“Downgraded Lender” means any Lender that has a non-credit enhanced
senior unsecured debt rating below A- or A3 from S&P or Moody’s, respectively.



“First Amendment” shall mean the First Amendment to Credit Agreement,
dated as of February 25, 2010, among the Borrowers, the Lenders party thereto, and
the Administrative Agent.



“First Amendment Effective Date” shall mean the date upon which the
conditions to the effectiveness of the First Amendment set forth in Article II
thereof are satisfied or waived in accordance with their terms.



“Net Termination Obligations” means, in respect of any one or more
Hedge Agreements, after taking into account the effect of any legally enforceable
netting agreement relating to such Hedge Agreements, (a) for any date on or after
the date such Hedge Agreement have been closed out and termination obligations(s)
determined in accordance therewith, such termination obligation(s), and (b) for any
date prior to the date referenced in clause (a), the amount(s) determined as the
mark-to-market value(s) for such Hedge Agreements, as determined based upon one or
more mid-market or other readily available quotations provided by any recognized
dealer in such Hedge Agreements, reputable pricing agent or custodian bank (which
may include a Lender or any Affiliate of a Lender).



(b) The following definitions in Section 1.1 of the Unsecured Credit Agreement are hereby
amended and restated in their entirety as follows:



“Base Rate” means the highest of (i) the per annum interest rate
publicly announced from time to time by Wachovia in Charlotte, North Carolina, to be
its prime rate (which may not necessarily be its lowest or best lending rate), as
adjusted to conform to changes as of the opening of business on the date of any such
change in such prime rate, (ii) the Federal Funds Rate plus 0.5% per annum, as
adjusted to conform to changes as of the opening of business on the date of any such
change in the Federal Funds Rate and (iii) the LIBOR Rate for an interest period of
one month plus 1.00%.



“Defaulting Lender” means any Lender that (i) has refused to fund, or
otherwise defaulted in the funding of, its Ratable Share of (A) any Borrowing
requested and permitted be made hereunder, (B) any drawing made on any Syndicated
Letter of Credit or (C) any participation interest in any Participated Letter of
Credit in accordance with the terms hereof, (ii) has notified the Borrowers, the
Administrative Agent, an Issuing Bank or any Fronting Bank in writing that it does
not intend to comply with any or all of its funding obligations under this Agreement
or has made a public statement to the effect that it does not intend to comply with
any or all of its funding obligations under this Agreement or generally under other
agreements in which it commits to extend credit, (iii) has failed, within three
Business Days after receipt of a written request from the Administrative Agent to
confirm that it will comply with the terms of this Agreement relating to its
obligation to fund prospective Loans, drawings on or participations in Letters of
Credit, (iv) has failed to pay to the Administrative Agent, any Fronting Bank or any
Lender when due an amount owed by such Lender pursuant to the terms of this
Agreement, unless such amount is subject to a good faith dispute, or (v) (a) has
been deemed, become or is insolvent or is the Subsidiary of a Person that has been
deemed, become or is insolvent or (b) has become the subject of a proceeding under
the Bankruptcy Code or under any other applicable Debtor Relief Laws, or has had a
receiver, conservator, trustee, custodian or similar official appointed for it or
any substantial part of its property, or has taken any action in furtherance of, or
indicating its consent to, approval of or acquiescence in any such proceeding or
appointment or is a Subsidiary of a Person that has become the subject of a
proceeding under the Bankruptcy Code or under any other applicable Debtor Relief
Laws, or has had a receiver, conservator, trustee, custodian or similar official
appointed for it or any substantial part of its property, or has taken any action in
furtherance of, or indicating its consent to, approval of or acquiescence in any
such proceeding or appointment.



“Hedge Agreement” means any interest rate, credit default or foreign
currency rate swap, future, cap, collar, hedge, forward rate or other similar
agreement or arrangement (including any option to enter into any of the foregoing)
designed to protect against fluctuations in interest rates, credit spreads or
currency exchange rates.



(c) Clause (x) in the definition of “Indebtedness” is hereby amended and restated in its
entirety as follows:




“(x) the Net Termination Obligations of such Person under any Hedge Agreements,”



1.2 Amendments to Section 3.3 (Conditions Precedent to the Issuance of Letters of
Credit). Section 3.3(ix) is hereby amended and restated in its entirety as follows:



“(ix) with respect to the issuance of a Participated Letter of Credit or the
fronting for a Non-NAIC Lender in respect of a Syndicated Letter of Credit
pursuant to Section 3.1(h), a default of any Lender’s obligations to fund
under Section 3.2(e) exists or any Lender is at such time a Designated
Lender, unless the applicable Fronting Bank has entered into satisfactory
arrangements with the Borrowers or such Lender to eliminate the applicable
Fronting Bank’s risk with respect to such Lender.”



1.3 Amendments to Section 8.1 (Fundamental Changes). Section 8.1 is hereby amended
and restated in its entirety as follows:



“Section 8.1 Fundamental Changes. Except as permitted under Section
8.4, such Borrower will not, and will not permit or cause any of its Subsidiaries
to, liquidate, wind up or dissolve, or enter into any consolidation, merger or other
combination, or agree to do any of the foregoing; provided, however,
(i) that any such Borrower or any Subsidiary may merge into or consolidate with any
other Person so long as (y) the surviving corporation is a Borrower or a Wholly
Owned Subsidiary of any Borrower (and in any event, if any Borrower is a party to
such merger or consolidation, the surviving corporation shall be a Borrower, it
being understood and agreed that in the case of a merger or consolidation between a
Subsidiary of Holdings with Holdings, the survivor corporation of such merger or
consolidation shall be Holdings), and (z) immediately after giving effect thereto,
no Default or Event of Default would occur or exist and (ii) any Subsidiary may
liquidate, wind up or dissolve if (x) such Subsidiary owns no more than a nominal
amount of assets, has no more than a nominal amount of liabilities and does not
actively conduct, transact or otherwise engage in any business or operations and (y)
such liquidation, winding up or dissolution is not materially disadvantageous to the
Lenders.”



1.4 Amendment to Section 8.2 (Indebtedness). Clause (viii) of Section 8.2 of the
Unsecured Credit Agreement is hereby amended and restated in its entirety as follows:



“(viii) obligations (contingent or otherwise) existing or arising under any
Hedge Agreement entered into by such Person in the ordinary course of business for
the purpose of protecting against fluctuations in interest rates, credit spreads or
currency exchange rates and not for purposes of speculation or taking a ‘market
view’;”



1.5 Amendments to Section 8.3 (Liens). Section 8.3 of the Unsecured Credit Agreement
is hereby amended by deleting the word “and” at the conclusion of clause (v) and substituting
therefor a comma, renumbering the existing clause (vi) as clause (vii), and adding a new clause
(vi) to read as follows:



“(vi) Liens on cash or other investment assets not at any time exceeding
$265,000,000 securing Indebtedness permitted under Section 8.2(viii); and”



1.6 Amendments to Section 9.1 (Events of Default). Section 9.1(e) of the Unsecured
Credit Agreement is hereby amended by deleting the words “net termination obligation” in clause (z)
therein and substituting therefor the words “Net Termination Obligation”.



ARTICLE II

CONDITIONS OF EFFECTIVENESS




This First Amendment shall become effective as of the date (the “First Amendment Effective
Date”) when, and only when, each of the following conditions precedent shall have been
satisfied:



(a) The Administrative Agent shall have received, dated as of the First Amendment Effective
Date, an executed counterpart hereof from each of the Borrowers and the Required Lenders;



(b) On the First Amendment Effective Date, the representations and warranties set forth in
Article III hereof shall be true and correct; and



(c) The Borrowers shall have paid all reasonable out-of-pocket costs and expenses of the
Administrative Agent in connection with the preparation, negotiation, execution and delivery of
this First Amendment (including, without limitation, the reasonable fees and out-of-pocket expenses
of counsel for the Administrative Agent with respect thereto).



ARTICLE III

REPRESENTATIONS AND WARRANTIES




Each Borrower hereby represents and warrants, on and as of the First Amendment Effective Date,
that (i) the representations and warranties contained in the Unsecured Credit Agreement and the
other Credit Documents qualified as to materiality are true and correct and those not so qualified
are true and correct in all material respects, both immediately before and after giving effect to
this First Amendment (except to the extent any such representation or warranty is expressly stated
to have been made as of a specific date, in which case such representation or warranty is true and
correct (if qualified as to materiality) or true and correct in all material respects (if not so
qualified), in each case only on and as of such specific date), (ii) this First Amendment has been
duly authorized, executed and delivered by such Borrower and constitutes the legal, valid and
binding obligation of such Borrower enforceable against it in accordance with its terms and (iii)
no Default or Event of Default shall have occurred and be continuing on the First Amendment
Effective Date, both immediately before and after giving effect to the First Amendment.



ARTICLE IV

ACKNOWLEDGEMENT AND CONFIRMATION




Each party to this First Amendment hereby confirms and agrees that, after giving effect to
this First Amendment, and except as expressly amended hereby, the Unsecured Credit Agreement and
the other Credit Documents to which it is a party remain in full force and effect and enforceable
against such party in accordance with their respective terms and shall not be discharged,
diminished, limited or otherwise affected in any respect. Each Borrower represents and warrants to
the Lenders that as of the First Amendment Effective Date it has no knowledge of any claims,
counterclaims, offsets, or defenses to or with respect to its obligations under the Credit
Documents, or if such Borrower has any such claims, counterclaims, offsets, or defenses to the
Credit Documents or any transaction related to the Credit Documents, the same are hereby waived,
relinquished, and released in consideration of the execution of this First Amendment. This
acknowledgement and confirmation by each Borrower is made and delivered to induce the
Administrative Agent and the Lenders to enter into this First Amendment, and each Borrower
acknowledges that the Administrative Agent and the Lenders would not enter into this First
Amendment in the absence of the acknowledgement and confirmation contained herein.



ARTICLE V

MISCELLANEOUS




5.1 Governing Law. This First Amendment shall be governed by and construed and
enforced in accordance with the laws of the State of New York (including Sections 5-1401 and 5-1402
of the New York General Obligations Law, but excluding all other choice of law and conflicts of law
rules).



5.2 Credit Document. As used in the Unsecured Credit Agreement, “hereinafter,”
“hereto,” “hereof,” and words of similar import shall, unless the context otherwise requires, mean
the Unsecured Credit Agreement after amendment by this First Amendment. Any reference to the
Unsecured Credit Agreement or any of the other Credit Documents herein or in any such documents
shall refer to the Unsecured Credit Agreement and Credit Documents as amended hereby. This First
Amendment is limited to the matters expressly set forth herein, and shall not constitute or be
deemed to constitute an amendment, modification or waiver of any provision of the Unsecured Credit
Agreement except as expressly set forth herein. This First Amendment shall constitute a Credit
Document under the terms of the Unsecured Credit Agreement.



5.3 Expenses. The Borrowers shall (i) pay all reasonable fees and expenses of counsel
to the Administrative Agent, and (ii) reimburse the Administrative Agent for all reasonable
out-of-pocket costs and expenses, in each case, in connection with the preparation, negotiation,
execution and delivery of this First Amendment and the other Credit Documents delivered in
connection herewith.



5.4 Severability. To the extent any provision of this First Amendment is prohibited
by or invalid under the applicable law of any jurisdiction, such provision shall be ineffective
only to the extent of such prohibition or invalidity and only in any such jurisdiction, without
prohibiting or invalidating such provision in any other jurisdiction or the remaining provisions of
this First Amendment in any jurisdiction.



5.5 Successors and Assigns. This First Amendment shall be binding upon, inure to the
benefit of and be enforceable by the respective successors and permitted assigns of the parties
hereto.



5.6 Construction. The headings of the various sections and subsections of this First
Amendment have been inserted for convenience only and shall not in any way affect the meaning or
construction of any of the provisions hereof.



5.7 Counterparts; Integration. This First Amendment may be executed and delivered via
facsimile or electronic mail with the same force and effect as if an original were executed and may
be signed in any number of counterparts, each of which shall be an original, with the same effect
as if the signatures hereto were upon the same instrument. This First Amendment constitutes the
entire contract among the parties hereto with respect to the subject matter hereof and supersedes
any and all prior agreements and understandings, oral or written, relating to the subject matter
hereof.



IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to be executed by
their duly authorized officers as of the date first above written.




ALLIED WORLD ASSURANCE COMPANY HOLDINGS, LTD



	 	 	 
	By:

Name:

Title:

	 	/s/ Joan H. Dillard

Joan H. Dillard

E.V.P. and Chief Financial Officer
	
 
	 	 
	By:

Name:

Title:

	 	/s/ Marchelle D. Lewis

Marchelle Lewis

V.P. and Treasurer
	
 
	 	 







	 	 	ALLIED WORLD ASSURANCE COMPANY, LTD





	 	 	 
	By:

Name:

Title:

	 	/s/ Joan H. Dillard

Joan H. Dillard

E.V.P. and Chief Financial Officer
	
 
	 	 
	By:

Name:

Title:

	 	/s/ Marchelle D. Lewis

Marchelle Lewis

V.P. and Treasurer
	
 
	 	 







	 	 	 





LENDERS: WACHOVIA BANK, NATIONAL




ASSOCIATION, as the Administrative Agent, the
L/C Agent, a Fronting Bank and as a Lender



By: /s/ William R. Goley

Name: Willian R. Goley

Title: Director




Wachovia Bank , National Association




	 	 	 	JPMORGAN CHASE BANK, N.A.





By: /s/ Melvin D. Jackson

Name: Melvin D. Jackson

Title: V.P.





SUNTRUST BANK



By: /s/ William Christensen

Name: William Christensen

Title: Director





Credit Agricole Corporate & Investment Bank



By: /s/ Charlie Kornberger

Name: Charlie Kornberger

Title: Managing Director




By: /s/ Gina Harth-Cryde

Name: Gina Harth-Cryde

Title: Managing Director




ING BANK N.V., LONDON BRANCH



By: /s/ N J Marchant

Name: N J Marchant

Title: Director




By: /s/ M E R Sherman

Name: M E R Sherman

Title: Managing Director




Bank of America, N.A.



By: /s/ Brady Fife

Name: Brady Fife

Title: Director




BARCLAYS BANK PLC



By: /s/ Nicholas A. Bell

Name: Nicholas A. Bell

Title: Director




Lloyds TSB Bank plc



By: /s/ Morgan Beanland

Name: Morgan Beanland

Title: SVP FI B033




By: /s/ Shane Klein

Name: Shane Klein

Title: SVP FI K042




The Governor and Company of the Bank of Ireland, as Lender



By: /s/ K Rockett /s/ A Donovan

Name: K Rockett            A Donovan

Title: Senior Manager Manager




 The Bank of N.T. Butterfield & Son Limited



By: /s/ Alan Day

Name: Alan Day

Title: Vice President




By: /s/ Curtis Ballantyne

Name: Curtis Ballantyne

Title: Senior Vice President