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Exhibit
10.15
 Third Event Excess Catastrophe Reinsurance Contract
Effective: September 3, 2004




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Table of Contents
 Article
    
    
    
    PageI
    
    Classes of Business Reinsured
    
    
    1II
    
    Term
    
    
    1III
    
    Territory (BRMA 51A)
    
    
    2IV
    
    Exclusions
    
    
    2V
    
    Retention and Limit
    
    
    4VI
    
    Definitions
    
    
    5VII
    
    Other Reinsurance
    
    
    6VIII
    
    Florida Hurricane Catastrophe Fund
    
    
    6IX
    
    Loss Occurrence
    
    
    7X
    
    Loss Notices and Settlements
    
    
    8XI
    
    Salvage and Subrogation
    
    
    8XII
    
    Reinsurance Premium
    
    
    9XIII
    
    Late Payments
    
    
    9XIV
    
    Offset (BRMA 36D)
    
    
    11XV
    
    Access to Records (BRMA 1D)
    
    
    11XVI
    
    Liability of the Reinsurer
    
    
    11XVII
    
    Net Retained Lines (BRMA 32B)
    
    
    11XVIII
    
    Errors and Omissions (BRMA 14F)
    
    
    12XIX
    
    Currency (BRMA 12A)
    
    
    12XX
    
    Taxes (BRMA 50C)
    
    
    12XXI
    
    Federal Excise Tax (BRMA 17A)
    
    
    12XXII
    
    Reserve Requirements
    
    
    12XXIII
    
    Insolvency
    
    
    14XXIV
    
    Arbitration
    
    
    15XXV
    
    Service of Suit
    
    
    16XXVI
    
    Agency Agreement
    
    
    16XXVII
    
    Governing Law
    
    
    17XXVIII
    
    Confidentiality
    
    
    17XXIX
    
    Severability
    
    
    17XXX
    
    Intermediary (BRMA 23A)
    
    
    17Schedule A




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Third Event Excess Catastrophe Reinsurance Contract
Effective: September 3, 2004
  hereinafter referred to collectively as the
  (hereinafter referred to as the )
 Article I  Classes of Business Reinsured
  Article II  Term
 A.
    
    This Contract shall become effective on September 3, 2004, with respect to losses arising
out of loss occurrences commencing on or after that date, and shall remain in force until May
31, 2005, both days inclusive.B.
    
    If this Contract expires while a loss occurrence covered hereunder is in progress, the
Reinsurers liability hereunder shall, subject to the other terms and conditions of this
Contract, be determined as if the entire loss occurrence had occurred prior to the expiration
of this Contract, provided that no part of such loss occurrence is claimed against any renewal
or replacement of this Contract.
 
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Article III  Territory (BRMA 51A)
  Article IV  Exclusions
  1.
    
    Assumed reinsurance except for a 50.0% quota share of the First American Property
and Casualty Insurance Company Florida Homeowners Program produced and underwritten by
Mobile Homeowners Insurance Agencies, Inc.2.
    
    Financial guarantee and insolvency.3.
    
    Nuclear risks as defined in the Nuclear Incident Exclusion Clause  Physical
Damage  Reinsurance (U.S.A.) and the Nuclear Incident Exclusion Clause  Physical
Damage  Reinsurance (Canada) attached to and forming part of this Contract.4.
    
    Loss or damage caused by or resulting from war, invasion, hostilities, acts of
foreign enemies, civil war, rebellion, insurrection, military or usurped power, or
martial law or confiscation by order of any government or public authority, but this
exclusion shall not apply to loss or damage covered under a standard policy with a
standard War Exclusion Clause.5.
    
    Loss or liability excluded under the provisions of the Pools, Associations and
Syndicates Exclusion Clause attached to and forming part of this Contract.6.
    
    All liability of the Company arising by contract, operation of law, or otherwise,
from its participation or membership, whether voluntary or involuntary, in any insolvency
fund. Insolvency fund includes any guaranty fund, insolvency fund, plan, pool,
association, fund or other arrangement, however denominated, established or governed,
which provides for any assessment of or payment or assumption by the Company of part or
all of any claim, debt, charge, fee or other obligation of an insurer, or its successors
or assigns, which has been declared by any competent authority to be insolvent, or which
is otherwise deemed unable to meet any claim, debt, charge, fee or other obligation in
whole or in part.7.
    
    Losses in respect of overhead transmission and distribution lines and their
supporting structures other than those on or within 300 meters (or 1,000 feet) of the
insured premises. It is understood and agreed that public utilities extension and/or
suppliers extension and/or contingent business interruption coverages are not subject to
this exclusion, provided that these are not part of a transmitters or distributors
policy.8.
    
    Accident and Health, Casualty, Fidelity and/or Surety business.9.
    
    Pollution and seepage coverages excluded under the provisions of the Pollution and
Seepage Exclusion Clause (BRMA 39A) attached to and forming part of this Contract.
 
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10.
    
    Notwithstanding any other provision to the contrary within this Contract or any
amendment thereto, it is agreed that this Contract excludes loss, damage, cost or expense
directly or indirectly caused by, contributed to by, resulting from, or arising out of or
in connection with any act of terrorism, as defined herein, regardless of any other cause
or event contributing concurrently or in any other sequence to the loss.
 de jure de facto de jure de facto
 a.
    
    Involves violence against one or more persons; orb.
    
    Involves damage to property; orc.
    
    Endangers life other than that of the person committing the action; ord.
    
    Creates a risk to health or safety of the public or a section of the public; ore.
    
    Is designed to interfere with or to disrupt an electronic system.
   11.
    
    Loss or liability in any way or to any extent arising out of the actual or alleged
presence or actual, alleged or threatened presence of fungi including, but not limited to,
mold, mildew, mycotoxins, microbial volatile organic compounds or other microbial
contaminations. This includes:
 a.
    
    Any supervision, instruction, recommendations, warnings or advice given
or which should have been given in connection with the above; andb.
    
    Any obligation to share damages with or repay someone else who must pay
damages because of such injury or damage.
  
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12.
    
    Loss or liability excluded under the provisions of the Electronic Data Endorsement
B (N.M.A. 2915) attached to and forming part of this Contract.
 Article V  Retention and Limit
 A.
    
    As respects each excess layer of reinsurance coverage provided by this Contract, the
Company shall retain and be liable for the first amount of ultimate net loss, shown as
Companys Retention for that excess layer in Schedule A attached hereto, arising out of each
loss occurrence. Subject to the provisions of paragraph B and C below, the Reinsurer shall
then be liable, as respects each excess layer, for the amount by which such ultimate net loss
exceeds the Companys applicable retention, but the liability of the Reinsurer under each
excess layer shall not exceed the amount, shown as Reinsurers Limit for that excess layer
in Schedule A attached hereto, as respects any one loss occurrence or in all during the term
of this Contract.B.
    
    No claim shall be made under any excess layer of reinsurance coverage provided by this
Contract as respects any one loss occurrence unless at least two risks insured or reinsured by
the Company are involved in such loss occurrence. For purposes of this Contract, the Company
shall be the sole judge of what constitutes one risk.C.
    
    No claim shall be made under the underlying excess layer of coverage provided by this
Contract unless the amount, shown as Funds Otherwise Recoverable in Schedule A attached
hereto, for the underlying excess layer has been paid or scheduled to be paid by the
reinsurers under the underlying excess layer of the Companys Underlying Excess Catastrophe
Reinsurance Contract, effective July 1, 2004. No claim shall be made under the first excess
layer of coverage provided by this Contract unless the amount, shown as Funds Otherwise
Recoverable in Schedule A attached hereto, has been paid or scheduled to be paid by the
reinsurers under the first excess layer of the Companys Excess Catastrophe Reinsurance
Contract, effective June 1, 2004.
 
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Article VI  Definitions
 A.
    
    Ultimate net loss as used herein is defined as the sum or sums (including loss in excess
of policy limits, extra contractual obligations and loss adjustment expense, as hereinafter
defined) paid or payable by the Company in settlement of claims and in satisfaction of
judgments rendered on account of such claims, after deduction of all salvage, all recoveries
and all claims on inuring insurance or reinsurance, whether collectible or not. Nothing
herein shall be construed to mean that losses under this Contract are not recoverable until
the Companys ultimate net loss has been ascertained.B.
    
    Loss in excess of policy limits and extra contractual obligations as used herein shall be
defined as follows:
 1.
    
    Loss in excess of policy limits shall mean 90.0% of any amount paid or payable by
the Company in excess of its policy limits, but otherwise within the terms of its policy,
such loss in excess of the Companys policy limits having been incurred because of, but
not limited to, failure by the Company to settle within the policy limits or by reason of
the Companys alleged or actual negligence, fraud or bad faith in rejecting an offer of
settlement or in the preparation of the defense or in the trial of any action against its
insured or reinsured or in the preparation or prosecution of an appeal consequent upon
such an action.2.
    
    Extra contractual obligations shall mean 90.0% of any punitive, exemplary,
compensatory or consequential damages paid or payable by the Company, not covered by any
other provision of this Contract and which arise from the handling of any claim on
business subject to this Contract, such liabilities arising because of, but not limited
to, failure by the Company to settle within the policy limits or by reason of the
Companys alleged or actual negligence, fraud or bad faith in rejecting an offer of
settlement or in the preparation of the defense or in the trial of any action against its
insured or reinsured or in the preparation or prosecution of an appeal consequent upon
such an action. An extra contractual obligation shall be deemed, in all circumstances,
to have occurred on the same date as the loss covered or alleged to be covered under the
policy.
    
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C.
    
    Loss adjustment expense as used herein shall mean expenses assignable to the investigation,
appraisal, adjustment, settlement, litigation, defense and/or appeal of specific claims,
regardless of how such expenses are classified for statutory reporting purposes. Loss
adjustment expense shall include, but not be limited to, declaratory judgments, interest on
judgments, expenses of outside adjusters, and a pro rata share of the salaries and expenses of
the Companys field employees according to the time occupied adjusting such losses and
expenses of the Companys officials incurred in connection with the losses, but shall not
include office expenses or salaries of the Companys regular employees.
 Article VII  Other Reinsurance
 A.
    
    The Company shall be permitted to carry excess reinsurance, recoveries under which shall
inure to the benefit of this Contract.B.
    
    The Company shall be permitted to carry net quota share reinsurance, recoveries under which
shall inure solely to the benefit of the Company.
 Article VIII  Florida Hurricane Catastrophe Fund
 A.
    
    Any loss reimbursement paid or payable to the Company under the Florida Hurricane
Catastrophe Fund (FHCF) as a result of loss occurrences commencing during the term of this
Contract shall inure to the benefit of this Contract. Further, any FHCF loss reimbursement
shall be deemed to be paid to the Company in accordance with the reimbursement contract
between the Company and the State Board of Administration of the State of Florida at the full
payout level set forth therein and will be deemed not to be reduced by any reduction or
exhaustion of the FHCFs claims paying capacity.B.
    
    Prior to the determination of the Companys FHCF retention and payout, if any, under the
reimbursement contract, the Reinsurers liability hereunder will be determined provisionally
based on the projected payout, determined in accordance with the provisions of the
reimbursement contract. Following determination of the payout under the reimbursement
contract, the ultimate net loss under this Contract will be recalculated. If, as a result of
such calculation, the loss to the Reinsurer under any excess layer of this Contract in any one
loss occurrence is less than the amount previously paid by the Reinsurer under that excess
layer, the Company shall promptly remit the difference to the Reinsurer. If the loss to the
Reinsurer under any excess layer in any one loss occurrence is greater than the amount
previously paid by the Reinsurer, the Reinsurer shall promptly remit the difference to the
Company.C.
    
    If an FHCF reimbursement amount is based on the Companys losses in more than one loss
occurrence and the FHCF does not designate the amount allocable to each loss occurrence, the
FHCF reimbursement amount shall be prorated in the proportion that the Companys losses in
each loss occurrence bear to the Companys total losses arising out of all loss occurrences to
which the FHCF reimbursement applies.
 
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D.
    
    Any reimbursement premiums or emergency assessment paid by the Company under the FHCF shall
be deemed to be premiums paid for inuring reinsurance.
 Article IX  Loss Occurrence
 A.
    
    The term loss occurrence shall mean the sum of all individual losses directly occasioned
by any one disaster, accident or loss or series of disasters, accidents or losses arising out
of one event which occurs within the area of one state of the United States or province of
Canada and states or provinces contiguous thereto and to one another. However, the duration
and extent of any one loss occurrence shall be limited to all individual losses sustained by
the Company occurring during any period of 168 consecutive hours arising out of and directly
occasioned by the same event, except that the term loss occurrence shall be further defined
as follows:
 1.
    
    As regards windstorm, hail, tornado, hurricane, cyclone, including ensuing collapse
and water damage, all individual losses sustained by the Company occurring during any
period of 72 consecutive hours arising out of and directly occasioned by the same event.
However, the event need not be limited to one state or province or states or provinces
contiguous thereto.2.
    
    As regards riot, riot attending a strike, civil commotion, vandalism and malicious
mischief, all individual losses sustained by the Company occurring during any period of
72 consecutive hours within the area of one municipality or county and the municipalities
or counties contiguous thereto arising out of and directly occasioned by the same event.
The maximum duration of 72 consecutive hours may be extended in respect of individual
losses which occur beyond such 72 consecutive hours during the continued occupation of an
insureds premises by strikers, provided such occupation commenced during the aforesaid
period.3.
    
    As regards earthquake (the epicentre of which need not necessarily be within the
territorial confines referred to in the introductory portion of this paragraph) and fire
following directly occasioned by the earthquake, only those individual fire losses which
commence during the period of 168 consecutive hours may be included in the Companys
loss occurrence.4.
    
    As regards freeze, only individual losses directly occasioned by collapse,
breakage of glass and water damage (caused by bursting frozen pipes and tanks) may be
included in the Companys loss occurrence.5.
    
    As regards firestorms, brush fires, and other fires or series of fires,
irrespective of origin (except as provided in subparagraphs 2 and 3 above), which spread
through trees, grassland or other vegetation, all individual losses sustained by the
Company which occur during any period of 168 consecutive hours within a 100-mile radius
of any one fixed point selected by the Company may be included in the Companys loss
occurrence. However, an individual loss subject to this subparagraph cannot be included
in more than one loss occurrence.
 
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B.
    
    For all those loss occurrences, other than those referred to in subparagraph 2 of paragraph
A above, the Company may choose the date and time when any such period of consecutive hours
commences, provided that it is not earlier than the date and time of the occurrence of the
first recorded individual loss sustained by the Company arising out of that disaster, accident
or loss, and provided that only one such period of 168 consecutive hours shall apply with
respect to one event, except for any loss occurrence referred to in subparagraph 1 of
paragraph A above where only one such period of 72 consecutive hours shall apply with respect
to one event, regardless of the duration of the event.C.
    
    As respects those loss occurrences referred to in subparagraph 2 of paragraph A above, if
the disaster, accident or loss occasioned by the event is of greater duration than 72
consecutive hours, then the Company may divide that disaster, accident or loss into two or
more loss occurrences, provided no two periods overlap and no individual loss is included in
more than one such period and provided that no period commences earlier than the date and time
of the occurrence of the first recorded individual loss sustained by the Company arising out
of that disaster, accident or loss.D.
    
    No individual losses occasioned by an event that would be covered by 72 hours clauses may be
included in any loss occurrence claimed under the 168 hours provision.
 Article X  Loss Notices and Settlements
 A.
    
    Whenever losses sustained by the Company appear likely to result in a claim hereunder, the
Company shall notify the Reinsurer, and the Reinsurer shall have the right to participate in
the adjustment of such losses at its own expense.
 B.
    
    All loss settlements made by the Company, provided they are within the terms of this
Contract, shall be binding upon the Reinsurer, and the Reinsurer agrees to pay all amounts for
which it may be liable upon receipt of reasonable evidence of the amount paid (or scheduled to
be paid) by the Company.
 Article XI  Salvage and Subrogation
  
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Article XII  Reinsurance Premium
 A.
    
    As premium for each excess layer of reinsurance coverage provided by this Contract, the
Company shall pay the Reinsurer the amount, shown as Premium for that excess layer in
Schedule A attached hereto, in two equal installments of the amount, shown as Installment
Premium for that excess layer in Schedule A attached hereto, on September 3, 2004 and March
1, 2005.B.
    
    In the event of incurred losses resulting from Hurricane Frances under the Companys Excess
Catastrophe Reinsurance Contract, effective June 1, 2004 and/or the underlying layer of the
Companys Underlying Excess Catastrophe Reinsurance Contract, effective July 1, 2004,
additional premium shall be due the Reinsurer as provided in paragraph C below.C.
    
    The Company shall remit additional premium, if any, on December 1, 2004. The additional
premium shall be calculated by multiplying the Additional Premium for each excess layer in
Schedule A attached hereto, by the following:
 1.
    
    As respects the underlying excess layer of coverage provided by this Contract, the
ratio of the ultimate net loss resulting from Hurricane Frances incurred by reinsurers
under the underlying layer of the Companys Underlying Excess Catastrophe Reinsurance
Contract, effective July 1, 2004, to the amount, shown as Reinsurers Limit in Schedule
A attached hereto, for the underlying excess layer.2.
    
    As respects the first excess layer of coverage provided by this Contract, the ratio
of ultimate net loss resulting from Hurricane Frances incurred by reinsurers under the
first excess layer of the Companys Excess Catastrophe Reinsurance Contract, effective
June 1, 2004, to the amount, shown as Reinsurers Limit in Schedule A attached hereto
for the first excess layer.
  Article XIII  Late Payments
 A.
    
    The provisions of this Article shall not be implemented unless specifically invoked, in
writing, by one of the parties to this Contract.B.
    
    In the event any premium, loss or other payment due either party is not received by the
intermediary named in Article XXX (hereinafter referred to as the Intermediary) by the
payment due date, the party to whom payment is due, may, by notifying the Intermediary in
writing, require the debtor party to pay, and the debtor party agrees to pay, an interest
penalty on the amount past due calculated for each such payment on the last business day of
each month as follows:
 1.
    
    The number of full days which have expired since the due date or the last monthly
calculation, whichever the lesser; times
 
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2.
    
    1/365ths of the six-month United States Treasury Bill rate, as quoted in The Wall
Street Journalon the first business day of the month for which the calculation is made;
times3.
    
    The amount past due, including accrued interest.
  C.
    
    The establishment of the due date shall, for purposes of this Article, be determined as
follows:
 1.
    
    As respects the payment of routine deposits and premiums due the Reinsurer, the due
date shall be as provided for in the applicable section of this Contract. In the event a
due date is not specifically stated for a given payment, it shall be deemed due 30 days
after the date of transmittal by the Intermediary of the initial billing for each such
payment.2.
    
    Any claim or loss payment due the Company hereunder shall be deemed due 10 business
days after the proof of loss or demand for payment is transmitted to the Reinsurer. If
such loss or claim payment is not received within the 10 days, interest will accrue on
the payment or amount overdue in accordance with paragraph B above, from the date the
proof of loss or demand for payment was transmitted to the Reinsurer.3.
    
    As respects any payment, adjustment or return due either party not otherwise
provided for in subparagraphs 1 and 2 of paragraph C above, the due date shall be as
provided for in the applicable section of this Contract. In the event a due date is not
specifically stated for a given payment, it shall be deemed due 10 business days
following transmittal of written notification that the provisions of this Article have
been invoked.
  D.
    
    Nothing herein shall be construed as limiting or prohibiting a Subscribing Reinsurer from
contesting the validity of any claim, or from participating in the defense of any claim or
suit, or prohibiting either party from contesting the validity of any payment or from
initiating any arbitration or other proceeding in accordance with the provisions of this
Contract. If the debtor party prevails in an arbitration or other proceeding, then any
interest penalties due hereunder on the amount in dispute shall be null and void. If the
debtor party loses in such proceeding, then the interest penalty on the amount determined to
be due hereunder shall be calculated in accordance with the provisions set forth above unless
otherwise determined by such proceedings. If a debtor party advances payment of any amount it
is contesting, and proves to be correct in its contestation, either in whole or in part, the
other party shall reimburse the debtor party for any such excess payment made plus interest on
the excess amount calculated in accordance with this Article.
 
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E.
    
    Interest penalties arising out of the application of this Article that are $100 or less from
any party shall be waived unless there is a pattern of late payments consisting of three or
more items over the course of any 12-month period.
 Article XIV  Offset (BRMA 36D)
  Article XV  Access to Records (BRMA 1D)
  Article XVI  Liability of the Reinsurer
 A.
    
    The liability of the Reinsurer shall follow that of the Company in every case and be
subject in all respects to all the general and specific stipulations, clauses, waivers and
modifications of the Companys policies and any endorsements thereon. However, in no event
shall this be construed in any way to provide coverage outside the terms and conditions set
forth in this Contract.B.
    
    Nothing herein shall in any manner create any obligations or establish any rights against the
Reinsurer in favor of any third party or any persons not parties to this Contract.
 Article XVII  Net Retained Lines (BRMA 32B)
 A.
    
    This Contract applies only to that portion of any policy which the Company retains net for
its own account, and in calculating the amount of any loss hereunder and also in computing the
amount or amounts in excess of which this Contract attaches, only loss or losses in respect of
that portion of any policy which the Company retains net for its own account shall be
included.B.
    
    The amount of the Reinsurers liability hereunder in respect of any loss or losses shall not
be increased by reason of the inability of the Company to collect from any other reinsurer(s),
whether specific or general, any amounts which may have become due from such reinsurer(s),
whether such inability arises from the insolvency of such other reinsurer(s) or otherwise.
 
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Article XVIII  Errors and Omissions (BRMA 14F)
  Article XIX  Currency (BRMA 12A)
 A.
    
    Whenever the word Dollars or the $ sign appears in this Contract, they shall be
construed to mean United States Dollars and all transactions under this Contract shall be in
United States Dollars.B.
    
    Amounts paid or received by the Company in any other currency shall be converted to United
States Dollars at the rate of exchange at the date such transaction is entered on the books of
the Company.
 Article XX  Taxes (BRMA 50C)
  Article XXI  Federal Excise Tax (BRMA 17A)
  A.
    
    The Reinsurer has agreed to allow for the purpose of paying the Federal Excise Tax the
applicable percentage of the premium payable hereon as imposed under Section 4371 of the
Internal Revenue Code to the extent such premium is subject to the Federal Excise Tax.B.
    
    In the event of any return of premium becoming due hereunder the Reinsurer will deduct the
applicable percentage from the return premium payable hereon and the Company or its agent
should take steps to recover the tax from the United States Government.
 Article XXII  Reserve Requirements
 A.
    
    If the Reinsurer is unauthorized in any state of the United States of America or the
District of Columbia, the Reinsurer agrees to fund its share of the Companys ceded United
States unearned premium and outstanding loss and loss adjustment expense reserves (including
 
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1.
    
    Clean, irrevocable and unconditional letters of credit issued and confirmed, if
confirmation is required by the insurance regulatory authorities involved, by a bank or
banks meeting the NAIC Securities Valuation Office credit standards for issuers of
letters of credit and acceptable to said insurance regulatory authorities; and/or2.
    
    Escrow accounts for the benefit of the Company; and/or3.
    
    Cash advances;
  B.
    
    If the Reinsurer is unauthorized in any province or jurisdiction of Canada, the Reinsurer
agrees to fund 115% of its share of the Companys ceded Canadian unearned premium and
outstanding loss and loss adjustment expense reserves (including all case reserves plus any
reasonable amount estimated to be unreported from known loss occurrences) by:
 1.
    
    A clean, irrevocable and unconditional letter of credit issued and confirmed, if
confirmation is required by the insurance regulatory authorities involved, by a Canadian
bank or banks meeting the NAIC Securities Valuation Office credit standards for issuers
of letters of credit and acceptable to said insurance regulatory authorities, for no more
than 15/115ths of the total funding required; and/or2.
    
    Cash advances for the remaining balance of the funding required;
  C.
    
    With regard to funding in whole or in part by letters of credit, it is agreed that each
letter of credit will be in a form acceptable to insurance regulatory authorities involved,
will be issued for a term of at least one year and will include an evergreen clause, which
automatically extends the term for at least one additional year at each expiration date unless
written notice of non-renewal is given to the Company not less than 30 days prior to said
expiration date. The Company and the Reinsurer further agree, notwithstanding anything to the
contrary in this Contract, that said letters of credit may be drawn upon by the Company or its
successors in interest at any time, without diminution because of the insolvency of the
Company or the Reinsurer, but only for one or more of the following purposes:
 1.
    
    To reimburse itself for the Reinsurers share of unearned premiums returned to
insureds on account of policy cancellations, unless paid in cash by the Reinsurer;
 
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2.
    
    To reimburse itself for the Reinsurers share of losses and/or loss adjustment
expense paid under the terms of policies reinsured hereunder, unless paid in cash by the
Reinsurer;3.
    
    To reimburse itself for the Reinsurers share of any other amounts claimed to be
due hereunder, unless paid in cash by the Reinsurer;4.
    
    To fund a cash account in an amount equal to the Reinsurers share of any ceded
unearned premium and/or outstanding loss and loss adjustment expense reserves (including
all case reserves plus any reasonable amount estimated to be unreported, from known loss
occurrences) funded by means of a letter of credit which is under non-renewal notice, if
said letter of credit has not been renewed or replaced by the Reinsurer 10 days prior to
its expiration date;5.
    
    To refund to the Reinsurer any sum in excess of the actual amount required to fund
the Reinsurers share of the Companys ceded unearned premium and/or outstanding loss and
loss adjustment expense reserves (including all case reserves plus any reasonable amount
estimated to be unreported from known loss occurrences), if so requested by the
Reinsurer.
  Article XXIII  Insolvency
 A.
    
    In the event of the insolvency of one or more of the reinsured companies, this reinsurance
shall be payable directly to the company or to its liquidator, receiver, conservator or
statutory successor on the basis of the liability of the company without diminution because of
the insolvency of the company or because the liquidator, receiver, conservator or statutory
successor of the company has failed to pay all or a portion of any claim. It is agreed,
however, that the liquidator, receiver, conservator or statutory successor of the company
shall give written notice to the Reinsurer of the pendency of a claim against the company
indicating the policy or bond reinsured which claim would involve a possible liability on the
part of the Reinsurer within a reasonable time after such claim is filed in the conservation
or liquidation proceeding or in the receivership, and that during the pendency of such claim,
the Reinsurer may investigate such claim and interpose, at its own expense, in the proceeding
where such claim is to be adjudicated, any defense or defenses that it may deem available to
the company or its liquidator, receiver, conservator or statutory successor. The expense thus
incurred by the Reinsurer shall be chargeable, subject to the approval of the Court, against
the company as part of the expense of conservation or liquidation to the extent of a pro rata
share of the benefit which may accrue to the company solely as a result of the defense
undertaken by the Reinsurer.B.
    
    Where two or more reinsurers are involved in the same claim and a majority in interest elect
to interpose defense to such claim, the expense shall be apportioned in accordance with the
terms of this Contract as though such expense had been incurred by the company.
 
 Page14




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##### 



C.
    
    It is further understood and agreed that, in the event of the insolvency of one or more of
the reinsured companies, the reinsurance under this Contract shall be payable directly by the
Reinsurer to the company or to its liquidator, receiver or statutory successor, except as
provided by Section 4118(a) of the New York Insurance Law or except (1) where this Contract
specifically provides another payee of such reinsurance in the event of the insolvency of the
company or (2) where the Reinsurer with the consent of the direct insured or insureds has
assumed such policy obligations of the company as direct obligations of the Reinsurer to the
payees under such policies and in substitution for the obligations of the company to such
payees.
 Article XXIV  Arbitration
 A.
    
    As a condition precedent to any right of action hereunder, any dispute or difference
between the Company and any Reinsurer relating to the interpretation or performance of this
Contract, including its formation or validity, or any transaction under this Contract, whether
arising before or after termination, shall be submitted to arbitration.B.
    
    If more than one reinsurer is involved in the same dispute, all such reinsurers shall
constitute and act as one party for purposes of this Article provided that communication shall
be made by the Company to each of the reinsurers constituting the one party, and provided,
however, that nothing therein shall impair the rights of such reinsurers to assert several,
rather than joint, defenses or claims, nor be construed as changing the liability of the
Reinsurer under the terms of this Contract from several to joint.C.
    
    Upon written request of any party, each party shall choose an arbitrator and the two chosen
shall select a third arbitrator. If either party refuses or neglects to appoint an arbitrator
within 30 days after receipt of the written request for arbitration, the requesting party may
appoint a second arbitrator. If the two arbitrators fail to agree on the selection of a third
arbitrator within 30 days of their appointment, the Company shall petition the American
Arbitration Association to appoint the third arbitrator. If the American Arbitration
Association fails to appoint the third arbitrator within 30 days after it has been requested
to do so, either party may request a justice of a court of general jurisdiction of the state
in which the arbitration is to be held to appoint the third arbitrator. All arbitrators shall
be active or retired officers of insurance or reinsurance companies, or Lloyds London
Underwriters, and disinterested in the outcome of the arbitration. Each party shall submit
its case to the arbitrators within 30 days of the appointment of the third arbitrator.D.
    
    The parties hereby waive all objections to the method of selection of the arbitrators, it
being the intention of both sides that all the arbitrators be chosen from those submitted by
the parties.E.
    
    The arbitrators shall have the power to determine all procedural rules for the holding of the
arbitration including but not limited to inspection of documents, examination of witnesses and
any other matter relating to the conduct of the arbitration. The arbitrators shall interpret
this Contract as an honorable engagement and not as merely a legal obligation; they are
relieved of all judicial formalities and may abstain from following the strict rules of law.
The arbitrators may award interest and costs. Each party shall bear the expense of its own
 
 Page 15




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##### 



arbitrator and shall share equally with the other party the expenses of the third arbitrator
and of the arbitration.F.
    
    The decision in writing of the majority of the arbitrators shall be final and binding upon
both parties. Judgment may be entered upon the final decision of the arbitrators in any court
having jurisdiction. The arbitration shall take place in Bala Cynwyd, Pennsylvania, unless
otherwise mutually agreed between the Company and the Reinsurer.G.
    
    This Article shall remain in full force and effect in the event any other provision of this
Contract shall be found invalid or non-binding.H.
    
    All time limitations stated in this Article may be amended by mutual consent of the parties,
and will be amended automatically to the extent made necessary by any circumstances beyond the
control of the parties.
 Article XXV  Service of Suit
  A.
    
    It is agreed that in the event the Reinsurer fails to pay any amount claimed to be due
hereunder, the Reinsurer, at the request of the Company, will submit to the jurisdiction of a
court of competent jurisdiction within the United States. Nothing in this Article constitutes
or should be understood to constitute a waiver of the Reinsurers rights to commence an action
in any court of competent jurisdiction in the United States, to remove an action to a United
States District Court, or to seek a transfer of a case to another court as permitted by the
laws of the United States or of any state in the United States.
 B.
    
    Further, pursuant to any statute of any state, territory or district of the United States
which makes provision therefor, the Reinsurer hereby designates the party named in its
Interests and Liabilities Agreement, or if no party is named therein, the Superintendent,
Commissioner or Director of Insurance or other officer specified for that purpose in the
statute, or his successor or successors in office, as its true and lawful attorney upon whom
may be served any lawful process in any action, suit or proceeding instituted by or on behalf
of the Company or any beneficiary hereunder arising out of this Contract.
 Article XXVI  Agency Agreement
  
 Page 16




---



##### 



Article XXVII  Governing Law
  Article XXVIII  Confidentiality
  Article XXIX  Severability
  Article XXX  Intermediary (BRMA 23A)
  In Witness Whereof
  
 
 Page 17




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##### 



Schedule A
 Third Event Excess Catastrophe Reinsurance Contract
Effective: September 3, 2004
  
 Underlying
    
    FirstExcess
    
    ExcessCompanys Retention
    
    $
    7,000,000
    
    
    $
    10,000,000Reinsurers Limit
    
    $
    3,000,000
    
    
    $
    10,000,000Funds Otherwise Recoverable
    
    $
    6,000,000
    
    
    $
    20,000,000Premium
    
    $
    540,000
    
    
    $
    1,200,000Installment Premium
    
    $
    270,000
    
    
    $
    600,000Additional Premium
    
    $
    660,000
    
    
    $
    1,550,000




---



##### 



Nuclear Incident Exclusion Clause  Physical Damage  Reinsurance (U.S.A.)
 1.
    
    This Reinsurance does not cover any loss or liability accruing to the Reassured, directly or
indirectly and whether as Insurer or Reinsurer, from any Pool of Insurers or Reinsurers formed
for the purpose of covering Atomic or Nuclear Energy risks.
 2.
    
    Without in any way restricting the operation of paragraph (1) of this Clause, this
Reinsurance does not cover any loss or liability accruing to the Reassured, directly or
indirectly and whether as Insurer or Reinsurer, from any insurance against Physical Damage
(including business interruption or consequential loss arising out of such Physical Damage)
to:
 I.
    
    Nuclear reactor power plants including all auxiliary property on the site, orII.
    
    Any other nuclear reactor installation, including laboratories
handling radioactive materials in connection with reactor
installations, and critical facilities as such, orIII.
    
    Installations for fabricating complete fuel elements or for
processing substantial quantities of special nuclear material, and
for reprocessing, salvaging, chemically separating, storing or
disposing of spent nuclear fuel or waste materials, orIV.
    
    Installations other than those listed in paragraph (2) III above
using substantial quantities of radioactive isotopes or other
products of nuclear fission.
 3.
    
    Without in any way restricting the operations of paragraphs (1) and (2) hereof, this
Reinsurance does not cover any loss or liability by radioactive contamination accruing to the
Reassured, directly or indirectly, and whether as Insurer or Reinsurer, from any insurance on
property which is on the same site as a nuclear reactor power plant or other nuclear
installation and which normally would be insured therewith except that this paragraph (3)
shall not operate
 (a)
    
    where Reassured does not have knowledge of such nuclear reactor power plant or
nuclear installation, or(b)
    
    where said insurance contains a provision excluding coverage for damage to property
caused by or resulting from radioactive contamination, however caused. However on and
after 1st January 1960 this sub-paragraph (b) shall only apply provided the said
radioactive contamination exclusion provision has been approved by the Governmental
Authority having jurisdiction thereof.
 4.
    
    Without in any way restricting the operations of paragraphs (1), (2) and (3) hereof, this
Reinsurance does not cover any loss or liability by radioactive contamination accruing to the
Reassured, directly or indirectly, and whether as Insurer or Reinsurer, when such radioactive
contamination is a named hazard specifically insured against.
 5.
    
    It is understood and agreed that this Clause shall not extend to risks using radioactive
isotopes in any form where the nuclear exposure is not considered by the Reassured to be the
primary hazard.
 6.
    
    The term special nuclear material shall have the meaning given it in the Atomic Energy Act
of 1954 or by any law amendatory thereof.7.
    
    Reassured to be sole judge of what constitutes:
 (a)
    
    substantial quantities, and(b)
    
    the extent of installation, plant or site.
 Note
 (a)
    
    all policies issued by the Reassured on or before 31st December 1957 shall be free
from the application of the other provisions of this Clause until expiry date or 31st
December 1960 whichever first occurs whereupon all the provisions of this Clause shall
apply.
 (b)
    
    with respect to any risk located in Canada policies issued by the Reassured on or
before 31st December 1958 shall be free from the application of the other provisions of
this Clause until expiry date or 31st December 1960 whichever first occurs whereupon all
the provisions of this Clause shall apply.




---



##### 



Nuclear Incident Exclusion Clause  Physical Damage  Reinsurance (Canada)
 1.
    
    This Agreement does not cover any loss or liability accruing to the Reinsured, directly or
indirectly, and whether as Insurer or Reinsurer, from any Pool of Insurers or Reinsurers
formed for the purpose of covering Atomic or Nuclear Energy risks.
 2.
    
    Without in any way restricting the operation of paragraph 1 of this clause, this Agreement
does not cover any loss or liability accruing to the Reinsured, directly or indirectly, and
whether as Insurer or Reinsurer, from any insurance against Physical Damage (including
business interruption or consequential loss arising out of such Physical Damage) to:
 (a)
    
    nuclear reactor power plants including all auxiliary property on the site, or(b)
    
    any other nuclear reactor installation, including laboratories handling radioactive
materials in connection with reactor installations, and critical facilities as such, or(c)
    
    installations for fabricating complete fuel elements or for processing substantial
quantities of radioactive materials, and for reprocessing, salvaging, chemically
separating, storing or disposing of spent nuclear fuel or waste materials, or(d)
    
    installations other than those listed in (c) above using substantial quantities of
radioactive isotopes or other products of nuclear fission.
 3.
    
    Without in any way restricting the operation of paragraphs 1 and 2 of this clause, this
Agreement does not cover any loss or liability by radioactive contamination accruing to the
Reinsured, directly or indirectly, and whether as Insurer or Reinsurer, from any insurance on
property which is on the same site as a nuclear reactor power plant or other nuclear
installation and which normally would be insured therewith, except that this paragraph 3 shall
not operate:
 (a)
    
    where the Reinsured does not have knowledge of such nuclear reactor power plant or
nuclear installation, or(b)
    
    where the said insurance contains a provision excluding coverage for damage to
property caused by or resulting from radioactive contamination, however caused.
 4.
    
    Without in any way restricting the operation of paragraphs 1, 2 and 3 of this clause, this
Agreement does not cover any loss or liability by radioactive contamination accruing to the
Reinsured, directly or indirectly, and whether as Insurer or Reinsurer, when such radioactive
contamination is a named hazard specifically insured against.
 5.
    
    This clause shall not extend to risks using radioactive isotopes in any form where the
nuclear exposure is not considered by the Reinsured to be the primary hazard.
 6.
    
    The term radioactive material means uranium, thorium, plutonium, neptunium, their
respective derivatives and compounds, radioactive isotopes of other elements and any other
substances which may be designated by or pursuant to any law, act or statute, or any law
amendatory thereof as being prescribed substances capable of releasing atomic energy, or as
being requisite for the production, use or application of atomic energy.7.
    
    Reinsured to be sole judge of what constitutes:
   8.
    
    Without in any way restricting the operation of paragraphs 1, 2, 3 and 4 of this clause, this
Agreement does not cover any loss or liability accruing to the Reinsured, directly or
indirectly, and whether as Insurer or Reinsurer, caused:
 (1)
    
    by any nuclear incident, as defined in or pursuant to the Nuclear Liability Act or
any other nuclear liability act, law or statute, or any law amendatory thereof or nuclear
explosion, except for ensuing loss or damage which results directly from fire, lightning
or explosion of natural, coal or manufactured gas;(2)
    
    by contamination by radioactive material.
 NOTE:
    
    Without in any way restricting the operation of paragraphs 1, 2, 3 and 4 of this clause,
paragraph 8 of this clause shall only apply to all original contracts of the Reinsured,
whether new, renewal or replacement, which become effective on or after December 31, 1992.




---



##### 



Pools, Associations and Syndicates Exclusion Clause
 Section A:
  (a)
    
    All business derived directly or indirectly from any Pool, Association or Syndicate
which maintains its own reinsurance facilities.(b)
    
    Any Pool or Scheme (whether voluntary or mandatory) formed after March 1, 1968 for
the purpose of insuring property whether on a country-wide basis or in respect of
designated areas. This exclusion shall not apply to so-called Automobile Insurance Plans
or other Pools formed to provide coverage for Automobile Physical Damage.
 Section B:
  
  (a)
    
    Where The Total Insured Value over all interests of the risk in question is less than
$250,000,000.(b)
    
    To interests traditionally underwritten as Inland Marine or stock and/or contents
written on a blanket basis.(c)
    
    To Contingent Business Interruption, except when the Company is aware that the key
location is known at the time to be insured in any Pool, Association or Syndicate named
above, other than as provided for under Section B(a).(d)
    
    To risks as follows:Offices, Hotels, Apartments, Hospitals, Educational Establishments, Public Utilities
(other than railroad schedules) and builders risks on the classes of risks specified in
this subsection (d) only.
  Section C:
  (1)
    
    The following so-called Coastal Pools:Alabama Insurance Underwriting Association
Louisiana Insurance Underwriting Association
Mississippi Windstorm Underwriting Association
North Carolina Insurance Underwriting Association
South Carolina Windstorm and Hail Underwriting Association
Texas Windstorm Insurance Association
  (2)
    
    All Fair Plan and Rural Risk Plan business
 Page 1 of 2




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##### 



(3)
    
    Citizens Property Insurance Corporation (CPIC) and the California Earthquake
Authority (CEA)
  (i)
    
    The inability of any other participant in such Coastal Pool and/or Fair Plan
and/or Rural Risk Plan and/or Residual Market Mechanisms to meet its liability.(ii)
    
    Any claim against such Coastal Pool and/or Fair Plan and/or Rural Risk Plan
and/or Residual Market Mechanisms, or any participant therein, including the Company,
whether by way of subrogation or otherwise, brought by or on behalf of any insolvency fund
(as defined in the Insolvency Fund Exclusion Clause incorporated in this Contract).
 Section D:
 (1)
    
    Notwithstanding Section C above, in respect of the CEA, where an assessment is made
against the Company by the CEA, the Company may include in its Ultimate Net Loss only that
assessment directly attributable to each separate loss occurrence covered hereunder. The
Companys initial capital contribution to the CEA shall not be included in the Ultimate
Net Loss.(2)
    
    Notwithstanding Section C above, in respect of CPIC, where an assessment is made
against the Company by CPIC, the maximum loss that the Company may include in the Ultimate
Net Loss in respect of any loss occurrence hereunder shall not exceed the lesser of:
 (a)
    
    The Companys assessment from CPIC for the accounting year in which the
loss occurrence commenced, or(b)
    
    The product of the following:
 (i)
    
    The Companys percentage participation in CPIC for the accounting
year in which the loss occurrence commenced; and(ii)
    
    CPICs total losses in such loss occurrence.
   Company
    
    shall be understood to mean Company,
Reinsured, Reassured or whatever other
term is used in the attached reinsurance
document to designate the reinsured company
or companies.Agreement
    
    shall be understood to mean Agreement,
Contract, Policy or whatever other term
is used to designate the attached reinsurance
document.Reinsurers
    
    shall be understood to mean Reinsurers,
Underwriters or whatever other term is used
in the attached reinsurance document to
designate the reinsurer or reinsurers.
 Page 2 of 2




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##### 



Pollution and Seepage Exclusion Clause




---



##### 



Electronic Data Endorsement B
 1.
    
    Electronic Data ExclusionNotwithstanding any provision to the contrary within the Contract or any endorsement thereto,
it is understood and agreed as follows:-
 a)
    
    This Contract does not insure loss, damage, destruction, distortion, erasure,
corruption or alteration of ELECTRONIC DATA from any cause whatsoever (including but not
limited to COMPUTER VIRUS) or loss of use, reduction in functionality, cost, expense of
whatsoever nature resulting therefrom, regardless of any other cause or event
contributing concurrently or in any other sequence to the loss.ELECTRONIC DATA means facts, concepts and information converted to a form useable for
communications, interpretation or processing by electronic and electromechanical data
processing or electronically controlled equipment and includes programs, software and
other coded instructions for the processing and manipulation of data or the direction and
manipulation of such equipment.COMPUTER VIRUS means a set of corrupting, harmful or otherwise unauthorized instructions
or code including a set of maliciously introduced unauthorized instructions or code,
programmatic or otherwise, that propagate themselves through a computer system or network
of whatsoever nature. COMPUTER VIRUS includes but is not limited to Trojan Horses,
worms and time or logic bombs.b)
    
    However, in the event that a peril listed below results from any of the matters
described in paragraph a) above, this Contract, subject to all its terms, conditions and
exclusions, will cover physical damage occurring during the Contract period to property
insured by this Contract directly caused by such listed peril.Listed PerilsFire
Explosion
 2.
    
    Electronic Data Processing Media ValuationNotwithstanding any provision to the contrary within the Contract or any endorsement thereto,
it is understood and agreed as follows:-Should electronic data processing media insured by this Contract suffer physical loss or damage
insured by this Contract, then the basis of valuation shall be the cost of the blank media plus
the costs of copying the ELECTRONIC DATA from back-up or from originals of a previous
generation. These costs will not include research and engineering nor any costs of recreating,
gathering or assembling such ELECTRONIC DATA. If the media is not repaired, replaced or
restored the basis of valuation shall be the cost of the blank media. However this Contract
does not insure any amount pertaining to the value of such ELECTRONIC DATA to the Assured or
any other party, even if such ELECTRONIC DATA cannot be recreated, gathered or assembled.




---



##### 



Interests and Liabilities Agreement
  hereinafter referred to as the Subscribing Reinsurer
  Third Event Excess Catastrophe Reinsurance Contract
Effective: September 3, 2004
  
 Subscribing Reinsurer
 7.4% of the Underlying Excess Catastrophe Reinsurance
7.4% of the First Excess Catastrophe Reinsurance
  Subscribing Reinsurers Subscribing Reinsurer
 In Witness Whereof Subscribing Reinsurer




---



##### 



Interests and Liabilities Agreement
  hereinafter referred to as the Subscribing Reinsurer
  Third Event Excess Catastrophe Reinsurance Contract
Effective: September 3, 2004
  
 Subscribing Reinsurer
 42.6% of the Underlying Excess Catastrophe Reinsurance
42.6% of the First Excess Catastrophe Reinsurance
  Subscribing Reinsurers Subscribing Reinsurer
 Subscribing Reinsurers
 Subscribing Reinsurer




---



##### 



Third Event Excess Catastrophe Reinsurance Contract
Effective: September 3, 2004
  
  Reinsurers
    
    ParticipationsCatlin Insurance Company Ltd.
    
    
    7.4
    %Through Benfield LimitedLloyds Underwriters Per Signing Schedules
    
    
    42.6Total
    
    50.0%part of
100% share in
the interests and
liabilities of the
Reinsurer
  Reinsurers
    
    ParticipationsCatlin Insurance Company Ltd.
    
    
    7.4
    %Through Benfield LimitedLloyds Underwriters Per Signing Schedules
    
    
    42.6Total
    
    50.0%part of
100% share in
the interests and
liabilities of the
Reinsurer




---



##### 



(NM)
    
    LLOYDS POLICY SIGNING OFFICE,/s/ [ILLEGIBLE]Definitive
Numbers of Syndicates and Amount, Percentage or Proportion of the
Total Sum insured hereunder shared between the Members of those
Syndicates.
    
    General Manager
 BUREAU REFERENCE
    
    61390 05/11/04
    
    BROKER NUMBER
    
    
    1108BUREAU REFERENCE
    
    61391 05/11/04
    
    BROKER NUMBER
    
    
    1108
 PROPORTION
    
    SYNDICATE
    
    UNDERWRITER'S%
    
    
    
    REFERENCE8.10
    
    
    2623
    
    
    T4924D04BNCB6.90
    
    
    623
    
    
    T4924D04BNCB11.00
    
    
    33
    
    
    97269ZXAAKWE7.40
    
    
    958
    
    
    YVXAXTEN82979.20
    
    
    2791
    
    
    X1104WG01597TOTAL LINE
    
    No. OF SYNDICATES42.60
    
    
    5




---



##### 



(NM)
    
    LLOYDS POLICY SIGNING OFFICE,/s/ [ILLEGIBLE]Definitive
Numbers of Syndicates and Amount, Percentage or Proportion of the
Total Sum insured hereunder shared between the Members of those
Syndicates.
    
    General Manager
 BUREAU REFERENCE
    
    61390 05/11/04
    
    BROKER NUMBER
    
    
    1108
 PROPORTION
    
    SYNDICATE
    
    UNDERWRITERS%
    
    
    
    REFERENCE8.10
    
    
    2623
    
    
    T7138S04BNCB6.90
    
    
    623
    
    
    T7138S04BNCB11.00
    
    
    33
    
    
    97268KXAAKWE7.40
    
    
    958
    
    
    YVXAXTEN82979.20
    
    
    2791
    
    
    X1104WG01597TOTAL LINE
    
    No. OF SYNDICATES42.60
    
    
    5




---



##### 



(NM)
    
    LLOYDS POLICY SIGNING OFFICE,/s/ [ILLEGIBLE]Definitive
Numbers of Syndicates and Amount, Percentage or Proportion of the
Total Sum insured hereunder shared between the Members of those
Syndicates.
    
    General Manager
 SEVERAL LIABILITY NOTICE
 The subscribing reinsurers
obligations under contracts of
reinsurance to which they subscribe are
several and not joint and are limited
solely to the extent of their individual
subscriptions. The subscribing reinsures
are not responsible for the subscription
of any co-subscribing reinsure who for
any reason does not satisfy all or part
of its obligations.LSW1001 (Reinsurance) 08/94
 The NAIC Identification Number for each participatingsyndicate shown herein is AA-112 followed by a four digitnumber that can be derived by adding 6000 to the
syndicate
number.LSW 1007 (09/96)