Exhibit 10.2

 
	




 
	
 UNSECURED CREDIT AGREEMENT

 
	
  

 
	
 dated as of

 
	
  

 
	
 December 9, 2011

 
	
  

 
	
 between

 
	
  

 
	
 XL GROUP PLC,

 
	
 XLIT LTD., X.L. AMERICA, INC., XL INSURANCE

 
	
 (BERMUDA) LTD, XL RE LTD, XL RE EUROPE LIMITED, XL INSURANCE COMPANY 

 
	
 LIMITED, XL INSURANCE SWITZERLAND LTD AND XL LIFE LTD,

 
	
 as Account Parties,

 
	
  

 
	
 XL GROUP PLC,

 
	
 XLIT LTD., X.L. AMERICA, INC., XL INSURANCE (BERMUDA) LTD, XL RE LTD
 AND
XL LIFE LTD,

 
	
 as Guarantors,

 
	
  

 
	
 and

 
	
  

 
	
 The LENDERS Party Hereto,

 
	
  

 
	
 JPMORGAN CHASE BANK, N.A.,

 
	
 as Administrative Agent

 






	
  

 	
  

 	
  

 
	
  

 	

 


 	
  

 
	
  

 	
 $1,350,000,000

 	
  

 
	
  

 
	
  

 	

 


 	
  

 
	
  

 
	
 J.P. MORGAN SECURITIES LLC,

 
	
  

 
	
 CITIGROUP GLOBAL MARKETS INC.,

 
	
  

 
	
 and

 
	
  

 
	
 RBS SECURITIES INC., as Joint Lead Arrangers and Joint Bookrunners

 
	
  

 	
  

 	
  

 
	
  

 	

 


 	
  

 
	
 CITIBANK, N.A. and RBS SECURITIES INC.,

 
	
  

 
	
 as Syndication Agents

 
	
  

 
	
  

 	

 


 	
  

 
	
  

 
	
 BARCLAYS BANK PLC, CREDIT AGRICOLE CORPORATE AND INVESTMENT BANK, 

 DEUTSCHE BANK SECURITIES INC, GOLDMAN SACHS BANK USA, THE BANK OF 

 TOKYO-MITSUBISHI UFJ, LTD. AND WELLS FARGO BANK, NATIONAL 

 ASSOCIATION

 
	
  

 
	
 as Documentation Agents

 












i


TABLE OF CONTENTS


	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 Page

 
	
  

 	
  

 	
  

 	
  

 	
 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE I

 	
  

 	
 1

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 DEFINITIONS

 	
  

 	
 1

 
	
  

 	
  

 	
 SECTION
 1.01. Defined Terms

 	
  

 	
 1

 
	
  

 	
  

 	
 SECTION
 1.02. Terms Generally

 	
  

 	
 19

 
	
  

 	
  

 	
 SECTION
 1.03. Accounting Terms; GAAP, Local GAAP, SAP and SFR

 	
  

 	
 20

 
	
  

 	
  

 	
 SECTION
 1.04. Exchange Rates; Currency Equivalents

 	
  

 	
 20

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE II

 	
  

 	
 21

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 THE CREDITS

 	
  

 	
 21

 
	
  

 	
  

 	
 SECTION
 2.01. Syndicated Letters of Credit

 	
  

 	
 21

 
	
  

 	
  

 	
 SECTION
 2.02. Issuance and Administration

 	
  

 	
 22

 
	
  

 	
  

 	
 SECTION
 2.03. Reimbursement of LC Disbursements, Etc.

 	
  

 	
 23

 
	
  

 	
  

 	
 SECTION
 2.04. Non-Syndicated Letters of Credit

 	
  

 	
 25

 
	
  

 	
  

 	
 SECTION
 2.05. Participated Letters of Credit

 	
  

 	
 31

 
	
  

 	
  

 	
 SECTION
 2.06. Alternative Currency Letters of Credit

 	
  

 	
 35

 
	
  

 	
  

 	
 SECTION
 2.07. Loans and Borrowings

 	
  

 	
 36

 
	
  

 	
  

 	
 SECTION
 2.08. Requests for Borrowings

 	
  

 	
 37

 
	
  

 	
  

 	
 SECTION
 2.09. Funding of Borrowings

 	
  

 	
 38

 
	
  

 	
  

 	
 SECTION 2.10.
 Interest Elections

 	
  

 	
 39

 
	
  

 	
  

 	
 SECTION
 2.11. Termination, Reduction and Increase of the Commitments

 	
  

 	
 40

 
	
  

 	
  

 	
 SECTION
 2.12. Repayment of Loans; Evidence of Debt

 	
  

 	
 41

 
	
  

 	
  

 	
 SECTION
 2.13. Prepayment of Loans

 	
  

 	
 42

 
	
  

 	
  

 	
 SECTION
 2.14. Fees

 	
  

 	
 43

 
	
  

 	
  

 	
 SECTION
 2.15. Interest

 	
  

 	
 44

 
	
  

 	
  

 	
 SECTION
 2.16. Alternate Rate of Interest

 	
  

 	
 44

 
	
  

 	
  

 	
 SECTION
 2.17. Increased Costs

 	
  

 	
 45

 
	
  

 	
  

 	
 SECTION
 2.18. Break Funding Payments

 	
  

 	
 46

 
	
  

 	
  

 	
 SECTION
 2.19. Taxes

 	
  

 	
 47

 
	
  

 	
  

 	
 SECTION
 2.20. Payments Generally; Pro Rata Treatment; Sharing of Set-offs

 	
  

 	
 50

 
	
  

 	
  

 	
 SECTION
 2.21. Mitigation Obligations; Replacement of Lenders

 	
  

 	
 52

 
	
  

 	
  

 	
 SECTION
 2.22. Defaulting Lenders

 	
  

 	
 53

 
	
  

 	
  

 	
 SECTION
 2.23. Absence of Rating

 	
  

 	
 54

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE III

 	
  

 	
 54

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 GUARANTEE

 	
  

 	
 54

 
	
  

 	
  

 	
 SECTION
 3.01. The Guarantee

 	
  

 	
 55

 
	
  

 	
  

 	
 SECTION 3.02. Obligations Unconditional

 	
  

 	
 55

 
	
  

 	
  

 	
 SECTION 3.03. Reinstatement

 	
  

 	
 55

 
	
  

 	
  

 	
 SECTION 3.04. Subrogation

 	
  

 	
 56

 
	
  

 	
  

 	
 SECTION
 3.05. Remedies

 	
  

 	
 56

 
	
  

 	
  

 	
 SECTION
 3.06. Continuing Guarantee

 	
  

 	
 56

 









ii


	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 SECTION
 3.07. Rights of Contribution

 	
  

 	
 56

 
	
  

 	
  

 	
 SECTION
 3.08. General Limitation on Guarantee Obligations

 	
  

 	
 57

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE IV

 	
  

 	
 57

 
	
  

 	
  

 	
  

 
	
  

 	
 REPRESENTATIONS
 AND WARRANTIES

 	
  

 	
 57

 
	
  

 	
  

 	
 SECTION
 4.01. Organization; Powers

 	
  

 	
 57

 
	
  

 	
  

 	
 SECTION
 4.02. Authorization; Enforceability

 	
  

 	
 57

 
	
  

 	
  

 	
 SECTION
 4.03. Governmental Approvals; No Conflicts

 	
  

 	
 58

 
	
  

 	
  

 	
 SECTION
 4.04. Financial Condition; No Material Adverse Change

 	
  

 	
 58

 
	
  

 	
  

 	
 SECTION
 4.05. Properties

 	
  

 	
 58

 
	
  

 	
  

 	
 SECTION
 4.06. Litigation and Environmental Matters

 	
  

 	
 59

 
	
  

 	
  

 	
 SECTION
 4.07. Compliance with Laws and Agreements

 	
  

 	
 59

 
	
  

 	
  

 	
 SECTION
 4.08. Investment Company Status

 	
  

 	
 59

 
	
  

 	
  

 	
 SECTION
 4.09. Taxes

 	
  

 	
 59

 
	
  

 	
  

 	
 SECTION
 4.10. ERISA

 	
  

 	
 59

 
	
  

 	
  

 	
 SECTION
 4.11. Disclosure

 	
  

 	
 60

 
	
  

 	
  

 	
 SECTION
 4.12. Use of Credit

 	
  

 	
 60

 
	
  

 	
  

 	
 SECTION
 4.13. Subsidiaries

 	
  

 	
 60

 
	
  

 	
  

 	
 SECTION
 4.14. Withholding Taxes

 	
  

 	
 61

 
	
  

 	
  

 	
 SECTION
 4.15. Stamp Taxes

 	
  

 	
 61

 
	
  

 	
  

 	
 SECTION
 4.16. Legal Form

 	
  

 	
 61

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE V

 	
  

 	
 61

 
	
  

 	
  

 	
  

 
	
  

 	
 CONDITIONS

 	
  

 	
 61

 
	
  

 	
  

 	
 SECTION 5.01. Effective Date

 	
  

 	
 61

 
	
  

 	
  

 	
 SECTION
 5.02. Each Credit Event

 	
  

 	
 63

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE VI

 	
  

 	
 63

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 AFFIRMATIVE
 COVENANTS

 	
  

 	
 63

 
	
  

 	
  

 	
 SECTION
 6.01. Financial Statements and Other Information

 	
  

 	
 63

 
	
  

 	
  

 	
 SECTION
 6.02. Notices of Material Events

 	
  

 	
 66

 
	
  

 	
  

 	
 SECTION
 6.03. Preservation of Existence and Franchises

 	
  

 	
 66

 
	
  

 	
  

 	
 SECTION
 6.04. Insurance

 	
  

 	
 66

 
	
  

 	
  

 	
 SECTION
 6.05. Maintenance of Properties

 	
  

 	
 67

 
	
  

 	
  

 	
 SECTION
 6.06. Payment of Taxes and Other Potential Charges and Priority Claims;
 Payment of Other Current Liabilities

 	
  

 	
 67

 
	
  

 	
  

 	
 SECTION
 6.07. Financial Accounting Practices

 	
  

 	
 67

 
	
  

 	
  

 	
 SECTION
 6.08. Compliance with Applicable Laws

 	
  

 	
 68

 
	
  

 	
  

 	
 SECTION
 6.09. Use of Letters of Credit and Proceeds

 	
  

 	
 68

 
	
  

 	
  

 	
 SECTION
 6.10. Continuation of and Change in Businesses

 	
  

 	
 68

 
	
  

 	
  

 	
 SECTION 6.11. Visitation

 	
  

 	
 68

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE VII

 	
  

 	
 68

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 NEGATIVE COVENANTS

 	
  

 	
 68

 
	
  

 	
  

 	
 SECTION 7.01. Mergers

 	
  

 	
 68

 









iii


	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 SECTION 7.02. Dispositions

 	
  

 	
 69

 
	
  

 	
  

 	
 SECTION 7.03. Liens

 	
  

 	
 70

 
	
  

 	
  

 	
 SECTION
 7.04. Transactions with Affiliates

 	
  

 	
 72

 
	
  

 	
  

 	
 SECTION
 7.05. Ratio of Total Funded Debt to Total Capitalization

 	
  

 	
 72

 
	
  

 	
  

 	
 SECTION
 7.06. Consolidated Net Worth

 	
  

 	
 72

 
	
  

 	
  

 	
 SECTION
 7.07. Indebtedness

 	
  

 	
 72

 
	
  

 	
  

 	
 SECTION
 7.08. Financial Strength Ratings

 	
  

 	
 73

 
	
  

 	
  

 	
 SECTION
 7.09. Private Act

 	
  

 	
 73

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE VIII

 	
  

 	
 73

 
	
  

 	
  

 	
  

 
	
  

 	
 EVENTS OF
 DEFAULT

 	
  

 	
 73

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE IX

 	
  

 	
 77

 
	
  

 	
  

 	
  

 
	
  

 	
 THE
 ADMINISTRATIVE AGENT

 	
  

 	
 77

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE X

 	
  

 	
 79

 
	
  

 	
  

 	
  

 
	
  

 	
 MISCELLANEOUS

 	
  

 	
 79

 
	
  

 	
  

 	
 SECTION
 10.01. Notices

 	
  

 	
 79

 
	
  

 	
  

 	
 SECTION
 10.02. Waivers; Amendments

 	
  

 	
 80

 
	
  

 	
  

 	
 SECTION
 10.03. Expenses; Indemnity; Damage Waiver

 	
  

 	
 81

 
	
  

 	
  

 	
 SECTION
 10.04. Successors and Assigns

 	
  

 	
 83

 
	
  

 	
  

 	
 SECTION
 10.05. Survival

 	
  

 	
 87

 
	
  

 	
  

 	
 SECTION
 10.06. Counterparts; Integration; Effectiveness

 	
  

 	
 87

 
	
  

 	
  

 	
 SECTION
 10.07. Severability

 	
  

 	
 87

 
	
  

 	
  

 	
 SECTION
 10.08. Right of Setoff

 	
  

 	
 88

 
	
  

 	
  

 	
 SECTION
 10.09. Governing Law; Jurisdiction; Etc.

 	
  

 	
 88

 
	
  

 	
  

 	
 SECTION
 10.10. WAIVER OF JURY TRIAL

 	
  

 	
 89

 
	
  

 	
  

 	
 SECTION
 10.11. Headings

 	
  

 	
 89

 
	
  

 	
  

 	
 SECTION
 10.12. Treatment of Certain Information; Confidentiality

 	
  

 	
 89

 
	
  

 	
  

 	
 SECTION
 10.13. Judgment Currency

 	
  

 	
 90

 
	
  

 	
  

 	
 SECTION
 10.14. USA PATRIOT Act

 	
  

 	
 91

 
	
  

 	
  

 	
 SECTION
 10.15. NO FIDUCIARY DUTY

 	
  

 	
 91

 
	
  

 	
  

 	
 SECTION 10.16. ILLEGALITY

 	
  

 	
 91

 









iv


	
  

 	
  

 	
  

 
	
 SCHEDULE I

 	
 -

 	
 Commitments

 
	
 SCHEDULE II

 	
 -

 	
 Indebtedness
 and Liens

 
	
 SCHEDULE III

 	
 -

 	
 Litigation

 
	
 SCHEDULE IV

 	
 -

 	
 Environmental
 Matters

 
	
 SCHEDULE V

 	
 -

 	
 Subsidiaries

 
	
 SCHEDULE VI

 	
 -

 	
 Existing
 Letters of Credit

 
	
  

 	
  

 	
  

 
	
 EXHIBIT A

 	
 -

 	
 Form of
 Assignment and Assumption

 
	
 EXHIBIT B

 	
 -

 	
 Form of
 Confirming Lender Agreement

 
	
 EXHIBIT C

 	
  

 	
 Form of
 Borrowing Request

 
	
 EXHIBIT D

 	
  

 	
 Form of
 Interest Election Request

 










                    UNSECURED
CREDIT AGREEMENT dated as of December 9, 2011 (as amended, restated,
supplemented or otherwise modified from time to time, this “Agreement”),
among XL GROUP PLC, an Irish public limited company (“XL Group”), XLIT
LTD., an exempted company incorporated in the Cayman Islands with limited
liability (“XLIT”), X.L. AMERICA, INC., a Delaware corporation (“XL
America”), XL INSURANCE (BERMUDA) LTD, a Bermuda limited liability company
(“XL Insurance (Bermuda)”), XL RE LTD, a Bermuda limited liability
company (“XL Re”), XL RE EUROPE LIMITED, an Irish limited liability
company (“XL Re Europe”), XL INSURANCE COMPANY LIMITED, a limited
company domiciled in the United Kingdom (“XL Insurance”), XL INSURANCE
SWITZERLAND LTD, a company limited by shares organized under the laws of
Switzerland (“XL Switzerland”), and XL LIFE LTD, a Bermuda company (“XL
Life” and together with XL Group, XLIT, XL America, XL Insurance (Bermuda),
XL Re, XL Re Europe, XL Insurance and XL Switzerland, each an “Account Party”
and collectively, the “Account Parties”; XL Group, XLIT, XL America, XL
Insurance (Bermuda), XL Re and XL Life, each a “Guarantor” and
collectively the “Guarantors”; the Account Parties and the Guarantors
being collectively referred to as the “Obligors”), the LENDERS party
hereto, and JPMORGAN CHASE BANK, N.A., as Administrative Agent.


                    The
Account Parties have requested that the Lenders issue letters of credit for
their account and make loans to them in an aggregate face or principal amount
not exceeding $1,350,000,000 at any one time outstanding (subject to the Loan
Sublimit (as defined below)), and the Lenders are prepared to issue such
letters of credit and make such loans upon the terms and conditions hereof.
Accordingly, the parties hereto agree as follows:


ARTICLE I


DEFINITIONS


                    SECTION
1.01. Defined Terms. As used in this Agreement, the following terms have
the meanings specified below:


                    “ABR”,
when used in reference to any Loan or Borrowing, refers to whether such Loan,
or the Loans constituting such Borrowing, are bearing interest at a rate
determined by reference to the Alternate Base Rate.


                    “Account
Parties” shall have the meaning assigned to such term in the introductory
paragraph of this Agreement.


                    “Account
Party Jurisdiction” means (a) Bermuda, (b) the Cayman Islands, (c) Ireland,
(d) Switzerland, (e) the United Kingdom, (f) the United States and (g) any
other country (i) where any Account Party is licensed or qualified to do
business or (ii) from or through which payments hereunder are made by any
Account Party.


                    “Adjusted
LIBO Rate” means, for the Interest Period for any Eurodollar Borrowing, an
interest rate per annum (rounded upwards, if necessary, to the next 1/100 of
1%)


1





equal to
(a) the LIBO Rate for such Interest Period multiplied by
(b) the Statutory Reserve Rate for such Interest Period.


                    “Administrative
Agent” means JPMCB, in its capacity as administrative agent for the Lenders
hereunder.


                    “Administrative
Questionnaire” means an Administrative Questionnaire in a form supplied by
the Administrative Agent.


                    “Affiliate”
means, with respect to a specified Person, another Person that directly, or
indirectly, Controls or is Controlled by or is under common Control with the
Person specified.


                    “Aggregate
Credit Exposure” means the aggregate amount of the Credit Exposures of each
of the Lenders.


                    “Aggregate
LC Exposure” means the aggregate amount of the LC Exposures of each of the
Lenders.


                    “Agreement”
shall have the meaning assigned to such term in the introductory paragraph of
this Agreement.


                    “Alternate
Base Rate” means, for any day, a rate per annum equal to the highest of
(a) the Prime Rate in effect on such day, (b) the Federal Funds
Effective Rate for such day plus 1/2 of 1% and (c) the Adjusted LIBO
Rate for an Interest Period of one month that would be calculated as of such
day (or, if such day is not a Business Day, as of the next preceding Business
Day) plus 1.0%. Any change in the Alternate Base Rate due to a change in
the Prime Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate
shall be effective from and including the date of such change in the Prime
Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate, as the case
may be.


                    “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 Lender 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, each as
contemplated hereunder, unless such authorization has been obtained and is in
full force and effect.


                    “Alternative
Currency Equivalent” means, at any time, with respect to any amount
denominated in Dollars, the equivalent amount thereof in the applicable
Alternative Currency as determined by the Administrative Agent or the Issuing
Lender, as the case may be, at such time on the basis of the Spot Rate
(determined in respect of the most recent Revaluation Date) for the purchase of
such Alternative Currency with Dollars.


                    “Alternative
Currency LC Exposure” means, at any time, the sum of (a) the Dollar
Equivalent of the aggregate undrawn amount of all outstanding Alternative
Currency Letters of Credit at such time plus (b) the Dollar
Equivalent of the aggregate amount of all LC


2





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 Lender shall at any time be such Lender’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 Lender in
an Alternative Currency pursuant to Section 2.06.


                    “Alternative
Currency Letter of Credit Report” has the meaning set forth in
Section 2.06(b).


                    “Applicable
Margin” means
(i) 0.0%, in the case of ABR Loans and (ii) a rate per annum equal to the
Credit Default Swap Spread at the applicable date of determination in the case
of Eurodollar Loans; provided that to the extent the Applicable Margin
for Eurodollar Loans is greater than 1.0%, the Applicable Margin for ABR Loans
shall be increased such that the difference between the Applicable Margin for
ABR Loans is equal to the Applicable Margin for Eurodollar Loans less 1.0%.
The Credit Default Swap Spread will be determined, as to each Eurodollar Loan, on the second
Business Day prior to the borrowing of such Eurodollar Loan, and thereafter, in
the case of any Eurodollar Loan having
an Interest Period of greater than three months, at the end of each successive
three-month period during such Interest Period. The Credit Default Swap Spread
will be determined as to ABR Loans initially on the Effective Date and
thereafter on the first Business Day of each succeeding calendar quarter. If at
any time the Credit Default Swap Spread cannot be determined, the Account
Parties and the Administrative Agent shall negotiate in good faith (for a
period of up to thirty days after the Credit Default Swap Spread becomes
unavailable (such thirty-day period, the “Negotiation Period”)) to agree
on an alternative method for establishing the Applicable Margin for Eurodollar Loans and ABR Loans. The
Applicable Margin for Eurodollar Loans
and ABR Loans for any determination date which falls during the Negotiation
Period shall be based upon the then most recently available Credit Default Swap
Spread (such rate, the “Prior Rate”). If no such alternative method is
agreed upon during the Negotiation Period, the Applicable Margin for Eurodollar Loans and ABR Loans for any
determination date subsequent to the end of the Negotiation Period shall be a
rate per annum equal to the Prior Rate and increased by (A) 0.25% on the first Business Day following the expiration of
the Negotiation Period (the “Initial Rate Increase Date”) and (B) an
additional 0.25% on each succeeding 90-day anniversary of the Initial Rate
Increase Date (or if any such 90th day is not a Business Day, on the
immediately succeeding Business Day), in each case, so long as the Credit
Default Swap Spread remains unavailable or is not provided by Markit and an
alternative method for establishing the Credit Default Swap Spread has not been
agreed upon by the Account Parties and the Administrative Agent
(provided that the Credit Default Swap Spread shall in no event be less
than the Minimum Applicable Margin or greater than the Maximum Applicable
Margin). Notwithstanding anything herein to the contrary, the Applicable
Margin for Eurodollar Loans and
ABR Loans in effect at any time shall not be less than the applicable “CDS
Floor” (the “Minimum Applicable Margin”), and shall not exceed the
applicable “CDS Cap” (the “Maximum Applicable Margin”) corresponding to
the debt rating of XLIT in effect on such date of determination and the type of
Loan as set forth under the definition of Pricing Grid. 


                    “Applicable
Percentage” means with respect to any Lender, the percentage of the
Commitments of all the Lenders represented by such Lender’s Commitment;
provided that with


3





respect to any
Lender in relation to its obligation to make Loans (or related matters), the
percentage represented by the amount that such Lender’s Applicable Percentage
(as determined above) of the Loan Sublimit bears to the Loan Sublimit. 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.


                    “Assignment
and Assumption” means an assignment and assumption entered into by a Lender
and an assignee (with the consent of any party whose consent is required by
Section 10.04), and accepted by the Administrative Agent, in the form of
Exhibit A or any other form approved by the Administrative Agent.


                    “Availability
Period” means the period from and including the Effective Date to and
including the Commitment Termination Date.


                    “Bankruptcy
Event” means with respect to any Person, such Person becomes the subject of
a bankruptcy or insolvency proceeding, or has had a receiver, conservator,
trustee, administrator, custodian, assignee for the benefit of creditors or
similar Person charged with the reorganization or liquidation of its business
appointed for it, or indicating its consent to, approval of, or acquiescence
in, any such proceeding or appointment, provided that a Bankruptcy Event shall
not result solely by virtue of any ownership interest, or the acquisition of
any ownership interest, in such Person by a Governmental Authority or
instrumentality thereof, provided, further, that such ownership interest does
not result in or provide such Person with immunity from the jurisdiction of
courts within the United States or from the enforcement in the United States of
judgments or writs of attachment on its assets or permit such Person (or such
Governmental Authority or instrumentality) to reject, repudiate, disavow or
disaffirm any contracts or agreements made by such Person.


                    “Bermuda
Companies Law” means the Companies Act 1981 of Bermuda, as amended, and the
regulations promulgated thereunder. 


                    “Bermuda
Insurance Law” means the Insurance Act 1978 of Bermuda, as amended, and the
regulations promulgated thereunder.


                    “Board”
means the Board of Governors of the Federal Reserve System of the United States
of America.


                    “Borrowing”
means, with respect to any Account Party, (a) all ABR Loans of such Account
Party made, converted or continued on the same date or (b) all Eurodollar Loans
of such Account Party that have the same Interest Period.


                    “Borrowing
Request” means a request by an Account Party for a Borrowing in accordance
with Section 2.08 substantially in the form of Exhibit C hereto.


                    “Business
Day” means any day (a) that is not a Saturday, Sunday or other day on which
commercial banks in New York City, London, Ireland or in the case of any
Specified Account Party, the jurisdiction of organization of such Account
Party, requesting the issuance of a Letter of Credit are authorized or required
by law to remain closed and (b) if such day relates to


4





a borrowing
of, a payment or prepayment of principal of or interest on, a continuation or
conversion of or into, or the Interest Period for, a Eurodollar Loan, or to a
notice by an Account Party with respect to any such borrowing, payment,
prepayment, continuation, conversion, or Interest Period, that is also a day on
which dealings in Dollar deposits are carried out in the London interbank
market.


                    “Capital
Lease Obligations” of any Person means the obligations of such Person to
pay rent or other amounts under any lease of (or other arrangement conveying
the right to use) real or personal property, or a combination thereof, which
obligations are required to be classified and accounted for as capital leases
on a balance sheet of such Person under GAAP, and the amount of such
obligations shall be the capitalized amount thereof determined in accordance
with GAAP.


                    “Change
in Control” means the occurrence of any of the following events or
conditions: (a) any Person, including any syndicate or group deemed to be a
Person under Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended, acquires beneficial ownership, directly or indirectly, through a
purchase, merger or other acquisition transaction or series of transactions, of
shares of capital stock of XL Group entitling such Person to exercise 40% or
more of the total voting power of all shares of capital stock of XL Group that
is entitled to vote generally in elections of directors, other than an
acquisition by XL Group, any of its Subsidiaries or any employee benefit plans
of XL Group; or (b) XL Group merges or consolidates with or into any other
Person (other than a Subsidiary), another Person (other than a Subsidiary)
merges into XL Group or XL Group conveys, sells, transfers or leases all or
substantially all of its assets to another Person (other than a Subsidiary), other
than any transaction: (i) that does not result in a reclassification,
conversion, exchange or cancellation of the outstanding shares of capital stock
of XL Group (other than the cancellation of any outstanding shares of capital
stock of XL Group held by the Person with whom it merges or consolidates) or
(ii) which is effected solely to change the jurisdiction of incorporation of XL
Group and results in a reclassification, conversion or exchange of outstanding
shares of capital stock of XL Group solely into shares of capital stock of the
surviving entity; or (c) a majority of the members of XL Group’s board of
directors are persons who are then serving on the board of directors without
having been elected by the board of directors or having been nominated for
election by its shareholders.


                    “Change
in Law” means (a) the adoption of any law, rule or regulation after
the date of this Agreement, (b) any change in any law, rule or regulation
or in the interpretation or application thereof by any Governmental Authority
after the date of this Agreement or (c) compliance by any Lender (or, for
purposes of Section 2.17(b), by any lending office of such Lender or by
such Lender’s holding company, if any) with any request, guideline or directive
(whether or not having the force of law) of any Governmental Authority made or
issued after the date of this Agreement.


                    “Code”
means the Internal Revenue Code of 1986, as amended from time to time.


                    “Commitment”
means, with respect to any Lender, the commitment of such Lender to make Loans,
to issue Syndicated Letters of Credit and Non-Syndicated Letters of Credit and
to acquire participations in Participated Letters of Credit, as any such
commitment


5





may be
(i) reduced from time to time pursuant to Section 2.11 and
(ii) reduced or increased from time to time pursuant to assignments by or
to such Lender pursuant to Section 10.04. The initial amount of each
Lender’s Commitment (including such Lender’s allocable portion of the Loan
Sublimit that may be borrowed under Section 2.07(a)) is set forth on
Schedule I or in the Assignment and Assumption pursuant to which such
Lender shall have assumed its Commitment, as applicable. The initial aggregate
amount of the Lenders’ Commitments is $1,350,000,000.


                    “Commitment
Termination Date” means December 9, 2015.


                    “Confirming
Lender” means, with respect to any Lender, any other Person which is listed
on the NAIC Approved Bank List that has agreed, by delivery of an agreement
between such Lender and such other Person in substantially the form of Exhibit
B or any other form satisfactory to the Administrative Agent, to honor the
obligations of such Lender in respect of a draft complying with the terms of a
Syndicated Letter of Credit or a Non-Syndicated Letter of Credit, as the case
may be, as if, and to the extent, such other Person were the “issuing lender”
(in place of such Lender) named in such Syndicated Letter of Credit or
Non-Syndicated Letter of Credit, as the case may be.


                    “Consolidated
Net Worth” means, at any time, the consolidated stockholders’ equity of XL
Group and its Subsidiaries, provided that the calculation of such
consolidated stockholders’ equity shall exclude (a) the effect thereon of any
adjustments required under Statement of Financial Accounting Standards No. 115
(“Accounting for Certain Investments in Debt and Equity Securities”) and (b)
any Exempt Indebtedness (and the assets relating thereto) in the event such
Exempt Indebtedness is consolidated on the consolidated balance sheet of XL
Group and its consolidated Subsidiaries in accordance with GAAP.


                    “Consolidated
Total Assets” means, on any date, total assets of XL Group and its
Subsidiaries on a consolidated basis determined in accordance with GAAP as of
the last day of the fiscal quarter immediately preceding the date of
determination.


                    “Control”
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management or policies of a Person, whether through the
ability to exercise voting power, by contract or otherwise. “Controlling”
and “Controlled” have meanings correlative thereto.


                    “Credit
Default Swap Spread” means at any determination date, the credit default
swap spread applicable to senior unsecured debt of XLIT interpolated for a
period to the Commitment Termination Date (or if the Commitment Termination
Date is less than one year from such determination date, the credit default
swap spread applicable to senior unsecured debt of XLIT for a period of one
year) in each case determined as of the close of business on the Business Day
immediately preceding such determination date, as interpolated and reported by
Markit Group Ltd. or any successor thereto (“Markit”).


                    “Credit
Documents” means, collectively, this Agreement and the Letter of Credit
Documents.


6





                    “Credit
Exposure” means, with respect to any Lender at any time, the sum of the
outstanding principal amount of such Lender’s Loans and its LC Exposure at such
time.


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


                    “Defaulting
Lender” means any Lender that (a) has failed, within three Business Days of
the date required to be funded or paid, to (i) fund any portion of its
participations in Letters of Credit or (ii) pay over to any Obligor any other
amount required to be paid by it hereunder, in either case, unless such Lender
notifies the Administrative Agent in writing that such failure is the result of
such Lender’s determination that one or more conditions
precedent to funding (which conditions precedent, together with the applicable
default, if any, shall be specifically identified in writing) has not been
satisfied, (b) has notified any Obligor in writing, or has made a public
statement to the effect, that it does not intend or expect to comply with any
of its funding obligations under this Agreement (unless such writing or public
statement states that such position is based on such Lender’s determination
that one or more conditions precedent to funding (which conditions precedent,
together with the applicable default, if any, shall be specifically identified
in such writing or public statement) cannot be satisfied), (c) has failed,
within three Business Days after request by the Administrative Agent, acting in
good faith, to provide a certification in writing from an authorized officer of
such Lender that it will comply with its obligations to fund participations in
then outstanding Letters of Credit, provided that such Lender shall cease to be
a Defaulting Lender pursuant to this clause (c) upon such receipt of such
certification in form and substance reasonably satisfactory to the
Administrative Agent, or (d) has become the subject of a Bankruptcy Event.


                    “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 Alternative Currency LC Exposure with
respect to such Alternative Currency Letter of Credit, on the basis of the Spot
Rate (determined in respect of the most recent Revaluation Date) for the
purchase of Dollars with such Alternative Currency.


                    “Dollars”
or “$” refers to lawful money of the United States of America.


                    “Effective
Date” means the date on which the conditions specified in Section 5.01
are satisfied (or waived in accordance with Section 10.02).


                    “Environmental
Laws” means any Law, whether now existing or subsequently enacted or
amended, relating to (a) pollution or protection of the environment,
including natural resources, (b) exposure of Persons, including but not
limited to employees, to Hazardous Materials, (c) protection of the public
health or welfare from the effects of products, by-products, wastes, emissions,
discharges or releases of Hazardous Materials or (d) regulation of the
manufacture, use or introduction into commerce of Hazardous Materials,
including their manufacture, formulation, packaging, labeling, distribution,
transportation, handling, storage or disposal.


7





                    “Environmental
Liability” means any liability, contingent or otherwise (including any
liability for damages, costs of environmental remediation, fines, penalties or
indemnities), of an Account Party or any Subsidiary resulting from or based
upon (a) violation of any Environmental Law, (b) the generation, use,
handling, transportation, storage, treatment or disposal of any Hazardous
Materials, (c) exposure to any Hazardous Materials, (d) the release
or threatened release of any Hazardous Materials into the environment or
(e) any contract or agreement pursuant to which liability is assumed or
imposed with respect to any of the foregoing.


                    “Equity
Rights” means, with respect to any Person, any subscriptions, options,
warrants, commitments, preemptive rights or agreements of any kind (including
any shareholders’ or voting trust agreements) for the issuance, sale,
registration or voting of, or securities convertible into, any additional
shares of capital stock of any class, or partnership or other ownership
interests of any type in, such Person.


                    “ERISA”
means the Employee Retirement Income Security Act of 1974, as amended from time
to time.


                    “ERISA
Affiliate” means any trade or business (whether or not incorporated) that,
together with any Account Party, is treated as a single employer under
Section 414(b) or (c) of the Code, or, solely for purposes of
Section 302 of ERISA and Section 412 of the Code, is treated as a
single employer under Section 414 of the Code.


                    “ERISA
Event” means (a) any “reportable event”, as defined in
Section 4043 of ERISA or the regulations issued thereunder with respect to
a Plan (other than an event for which the 30-day notice period is waived);
(b) the existence with respect to any Plan of an “accumulated funding
deficiency” (as defined in Section 412 of the Code or Section 302 of
ERISA), whether or not waived; (c) the filing pursuant to Section 412(d)
of the Code or Section 303(d) of ERISA of an application for a waiver of
the minimum funding standard with respect to any Plan; (d) the incurrence
by any Account Party or any of such Account Party’s ERISA Affiliates of any
liability under Title IV of ERISA with respect to the termination of any Plan;
(e) the receipt by any Account Party or any ERISA Affiliate from the PBGC
or a plan administrator of any notice relating to an intention to terminate any
Plan or Plans or to appoint a trustee to administer any Plan; (f) the
incurrence by any Account Party or any of its ERISA Affiliates of any liability
with respect to the withdrawal or partial withdrawal from any Plan or
Multiemployer Plan; or (g) the receipt by any Account Party or any ERISA
Affiliate of any notice, or the receipt by any Multiemployer Plan from any
Account Party or any ERISA Affiliate of any notice, concerning the imposition
of Withdrawal Liability or a determination that a Multiemployer Plan is, or is
expected to be, insolvent or in reorganization, within the meaning of Title IV
of ERISA.


                    “Eurodollar”,
when used in reference to any Loan or Borrowing, refers to whether such Loan,
or the Loan(s) constituting such Borrowing, are bearing interest at a rate
determined by reference to the Adjusted LIBO Rate. 


                    “Event
of Default” has the meaning assigned to such term in Article VIII.


8





                    “Excess
Funding Guarantor” has the meaning assigned to such term in
Section 3.07.


                    “Excess
Payment” has the meaning assigned to such term in Section 3.07.


                    “Excluded
Taxes” means, with respect to the Administrative Agent, any Lender or any
other recipient of any payment to be made by or on account of any obligation of
any Obligor hereunder, or under any Credit Document, (a) income or
franchise Taxes imposed on (or measured by) its net income, net profits or
overall gross receipts (including, without limitation, branch profits or
similar taxes) by the United States of America, or by any jurisdiction under
the laws of which such recipient is organized or resident, in which such
recipient’s principal office is located or with which such recipient has any
other connection (other than a connection that arises solely by reason of an
Account Party having executed, delivered or performed its obligations or a
Lender or the Administrative Agent having received a payment under this
Agreement or any Credit Document), (b) any Tax imposed pursuant to a law
in effect at the time such recipient first becomes a party to this Agreement or
designates a new lending office (or at the time such recipient acquires an
additional interest, but only with respect to Taxes attributable to such
additional interest) except to the extent that such recipient (or such
recipient’s assignor, if any) was entitled at the time of the designation of a
new lending office (or assignment) to receive additional amounts from the
Account Parties with respect to such Tax under Section 2.19(a) or 2.19(c), (c)
any Tax that is attributable to a recipient’s failure to comply with Section
2.19(f), and (d) any Tax imposed pursuant to FATCA.


                    “Exempt
Indebtedness” means any Indebtedness of any Person (other than XL Group or
any of its Affiliates) that is consolidated on the balance sheet of XL Group
and its consolidated Subsidiaries in accordance with GAAP (whether or not
required to be so consolidated); provided that (a) at the time of the
incurrence of such Indebtedness by such Person, the cash flows from the assets
of such Person shall reasonably be expected by such Person to liquidate such
Indebtedness and all other liabilities (contingent or otherwise) of such Person
and (b) no portion of such Indebtedness of such Person shall be Guaranteed
(other than guarantees of the type referred to in clause (a) or (b) of the
definition of Indebtedness) by, or shall be secured by a Lien on any assets
owned by, XL Group or any of its Subsidiaries and neither such Person nor any
of the holders of such Indebtedness shall have any direct or indirect recourse
to XL Group or any of its Subsidiaries (other than in respect of liabilities
and guarantees of the type referred to in clause (a) or (b) of the definition
of Indebtedness).


                    “Existing
Secured Credit Agreement” means the 3-Year Credit Agreement dated as of
March 25, 2011 among the Account Parties, the lenders party thereto, JPMCB, as
administrative agent and The Bank of New York Mellon, as collateral agent, as
amended, restated, supplemented or otherwise modified from time to time,
including any renewals, extensions or replacements thereof that increase the
principal amount thereof as of the Effective Date; provided, however,
that to the extent such principal amount exceeds $1,000,000,000 at any time,
such excess amount shall not be deemed to be incurred under the Existing
Secured Credit Agreement for purposes of Section 7.03 and Section 7.07. 


                    “Existing
Unsecured Credit Agreement” means the 5-Year Credit Agreement dated as of
June 21, 2007 among XLIT Ltd. (formerly XL Group Ltd. and XL Capital Ltd), XL


9





America, XL
Insurance (Bermuda), and XL Re, the lenders party thereto and JPMCB, as
administrative agent, as amended, restated, supplemented or otherwise modified
from time to time, including any renewals, extensions or replacements thereof.


                    “FATCA”
means Sections 1471 through 1474 of the Code as of the date of this Agreement
(including any amended or successor provisions thereto, to the extent
substantially comparable thereto), and any regulations or official
interpretations thereof.


                    “Federal
Funds Effective Rate” means, for any day, the weighted average (rounded
upwards, if necessary, to the next 1/100 of 1%) of the rates on overnight
Federal funds transactions with members of the Federal Reserve System arranged
by Federal funds brokers, as published on the next succeeding Business Day by
the Federal Reserve Bank of New York, or, if such rate is not so published for
any day that is a Business Day, the average (rounded upwards, if necessary, to
the next 1/100 of 1%) of the quotations for such day for such transactions
received by the Administrative Agent from three Federal funds brokers of
recognized standing selected by it.


                    “Financial
Officer” means, with respect to any Obligor, a principal financial officer
of such Obligor.


                    “GAAP”
means generally accepted accounting principles in the United States of America.


                    “GIC”
means a guaranteed investment contract or funding agreement or other similar
agreement issued by an Account Party or any of its Subsidiaries that guarantees
to a counterparty a rate of return on the invested capital over the life of
such contract or agreement.


                    “Governmental
Authority” means the government of the United States of America, or of any
other nation (including the European Union), or any political subdivision
thereof, whether state or local, and any agency, authority, instrumentality,
regulatory body, court, central bank or other entity exercising executive,
legislative, judicial, taxing, regulatory or administrative powers or functions
of or pertaining to government.


                    “Granting
Lender” has the meaning assigned to such term in Section 10.04.


                    “Guarantee”
means, with respect to any Person, without duplication, any obligations of such
Person (other than endorsements in the ordinary course of business of
negotiable instruments for deposit or collection) guaranteeing or intended to
guarantee any Indebtedness of any other Person in any manner, whether direct or
indirect, and including any obligation, whether or not contingent, (i) to
purchase any such Indebtedness or any property constituting security therefor
for the purpose of assuring the holder of such Indebtedness, (ii) to advance or
provide funds or other support for the payment or purchase of any such
Indebtedness or to maintain working capital, solvency or other balance sheet
condition of such other Person (including keepwell agreements, maintenance
agreements, comfort letters or similar agreements or arrangements) for the
benefit of any holder of Indebtedness of such other Person, (iii) to lease or
purchase property, securities or services primarily for the purpose of assuring
the holder of such Indebtedness, or (iv) to otherwise assure or hold harmless
the holder of such Indebtedness against loss in respect thereof. The amount of
any Guarantee hereunder shall (subject to any


10





limitations
set forth therein) be deemed to be an amount equal to the outstanding principal
amount of the Indebtedness in respect of which such Guarantee is made. The
terms “Guarantee” and “Guaranteed” used as a verb shall have a
correlative meaning.


                    “Guaranteed
Obligations” has the meaning assigned to such term in Section 3.01.


                    “Guarantors”
shall have the meaning assigned to such term in the introductory paragraph of
this Agreement.


                    “Hazardous
Materials” means all explosive or radioactive substances or wastes and all
hazardous or toxic substances, wastes or other pollutants, including petroleum
or petroleum distillates, asbestos or asbestos containing materials,
polychlorinated biphenyls, radon gas, infectious or medical wastes and all
other substances or wastes of any nature regulated pursuant to any
Environmental Law.


                    “Hedging
Agreement” means any interest rate protection agreement, foreign currency
exchange agreement, commodity price protection agreement or other interest or
currency exchange rate or commodity price hedging arrangement.


                    “Indebtedness”
means, for any Person, without duplication: (i) all indebtedness or liability
for or on account of money borrowed by, or for or on account of deposits with
or advances to (but not including accrued pension costs, deferred income taxes
or accounts payable of) such Person; (ii) all obligations (including contingent
liabilities) of such Person evidenced by bonds, debentures, notes, banker’s acceptances
or similar instruments; (iii) all indebtedness or liability for or on account
of property or services purchased or acquired by such Person; (iv) any
indebtedness or liability secured by a Lien on property owned by such Person
(whether or not assumed) and Capital Lease Obligations of such Person (without
regard to any limitation of the rights and remedies of the holder of such Lien
or the lessor under such capital lease to repossession or sale of such
property); (v) the maximum available amount of all standby letters of credit
issued for the account of such Person and, without duplication, all drafts
drawn thereunder (to the extent unreimbursed); and (vi) all Guarantees of such
Person; provided that the following shall be excluded from Indebtedness
of XL Group and any of its Subsidiaries for purposes of this Agreement: (a) all
payment liabilities of any such Person under insurance and reinsurance policies
from time to time issued by such Person, including guarantees of any such
payment liabilities; (b) all other liabilities (or guarantees thereof) arising
in the ordinary course of any such Person’s business as an insurance or
reinsurance company (including GICs and Stable Value Instruments and any
Specified Transaction Agreement relating thereto), or as a corporate member of
The Council of Lloyd’s, or as a provider of financial or investment services or
contracts (including GICs and Stable Value Instruments and any Specified
Transaction Agreement relating thereto); and (c) any Exempt Indebtedness.


                    “Indemnified
Taxes” means (a) Taxes imposed on the Administrative Agent or any Lender on
or with respect to any payment hereunder or under any Credit Document, other
than Excluded Taxes and (b) Other Taxes.


                    “Insurance
Subsidiary” means any Subsidiary (other than XL Life Insurance and Annuity
Company) which is subject to the regulation of, and is required to file
statutory financial


11





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.


                    “Interest
Election Request” means a request by an Account Party to convert or
continue a Borrowing in accordance with Section 2.10 substantially in the form of Exhibit D hereto.


                    “Interest
Payment Date” means (a) with respect to any ABR Loan, each Quarterly Date
and (b) with respect to any Eurodollar Loan, the last day of each Interest
Period therefor and, in the case of any Interest Period of more than three
months’ duration, each day prior to the last day of such Interest Period that
occurs at three-month intervals after the first day of such Interest Period.


                    “Interest
Period” means, for any Eurodollar Loan or Borrowing, the period commencing
on the date of such Loan or Borrowing and ending on the numerically
corresponding day in the calendar month that is one, two, three or six months
thereafter, as specified in the applicable Borrowing Request or Interest
Election Request; provided that (i) if any Interest Period would end on
a day other than a Business Day, such Interest Period shall be extended to the
next succeeding Business Day unless such next succeeding Business Day would
fall in the next calendar month, in which case such Interest Period shall end
on the next preceding Business Day, and (ii) any Interest Period that commences
on the last Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the last calendar month of such Interest
Period) shall end on the last Business Day of the last calendar month of such
Interest Period. For purposes hereof, the date of a Loan initially shall be the
date on which such Loan is made and thereafter shall be the effective date of
the most recent conversion or continuation of such Loan, and the date of a
Borrowing comprising Loans that have been converted or continued shall be the
effective date of the most recent conversion or continuation of such Loans.


                    “ISDA”
has the meaning assigned to such term in Section 7.03(e).


                    “Issuing
Lender” means (a) with respect to any Participated Letter of Credit, JPMCB,
in its capacity as the issuer of such Participated Letter of Credit hereunder,
and its successors in such capacity as provided in Section 2.05(j), (b)
with respect to any Syndicated Letter of Credit, each Lender, in its capacity
as the issuer of such Syndicated Letter of Credit and (c) with respect to any
Non-Syndicated Letter of Credit, the Lender named therein as the issuer
thereof.


                    “JPMCB”
means JPMorgan Chase Bank, N.A.


                    “Law”
means any law (including common law), constitution, statute, treaty,
regulation, rule, ordinance, order, injunction, writ, decree or award of any
Governmental Authority.


                    “LC
Disbursement” means (a) with respect to any Participated Letter of Credit
or Non-Syndicated Letter of Credit, a payment made by the Issuing Lender thereof
pursuant thereto


12





and (b) with
respect to any Syndicated Letter of Credit or Alternative Currency Letter of
Credit, a payment made by a Lender pursuant thereto.


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


                    “Lenders”
means the Persons listed on Schedule I and any other Person that shall
have become a party hereto pursuant to an Assignment and Assumption or an
agreement pursuant to the terms of Section 2.11(c), other than any such Person
that ceases to be a party hereto pursuant to an Assignment and Assumption (it
being understood and agreed that each Lender may, at its option, issue any
Letter of Credit to any Account Party by causing any foreign or domestic branch
or Affiliate of such Lender to issue such Letter of Credit; provided
that any exercise of such option shall not affect the obligations of such
Account Party in respect of such Letter of Credit in accordance with the terms
hereunder).


                    “Letter
of Credit Documents” means, 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 the rights and
obligations of the parties concerned or at risk with respect to such Letter of
Credit.


                    “Letters
of Credit” means each of the Syndicated Letters of Credit, the
Non-Syndicated Letters of Credit, the Participated Letters of Credit and the
Alternative Currency Letters of Credit.


                    “LIBO
Rate” means, for the Interest Period for any Eurodollar Borrowing, the rate
appearing on Reuters Page LIBOR01 (or on any successor or substitute page of
such Service, or any successor to or substitute for such Service, providing
rate quotations comparable to those currently provided on such page of such
Service, as determined by the Administrative Agent from time to time for
purposes of providing quotations of interest rates applicable to Dollar
deposits in the London interbank market) at approximately 11:00 a.m.,
London time, two Business Days prior to the commencement of such Interest
Period, as the rate for the offering of Dollar deposits with a maturity equal
to the duration of such Interest Period. In the event that such rate is not
available at such time for any reason, then the LIBO Rate for such Interest
Period shall be the rate at which Dollar deposits of $5,000,000 and for a
maturity equal to the duration of such Interest Period are offered by the principal
London office of the Administrative Agent in immediately available funds in the
London interbank market at approximately 11:00 a.m., London time, two
Business Days prior to the commencement of such Interest Period.


                    “Lien”
means, with respect to any asset, any mortgage, deed of trust, pledge, lien,
security interest, charge or other encumbrance or security arrangement of any
nature whatsoever, including but not limited to any conditional sale or title
retention arrangement, and any assignment, deposit arrangement or lease
intended as, or having the effect of, security.


13





                    “Life
Operations” has the meaning assigned to such term in Section 7.02(e).


                    “Loans”
means the loans made by the Lenders to the Account Parties pursuant to Section
2.07.


                    “Loan
Sublimit” means $1,000,000,000 as such amount shall be ratably reduced by
the amount of any reduction of the Loan Sublimit pursuant to Section 2.11.


                    “Local
GAAP” means generally accepted accounting principles in the jurisdiction of
any Account Party.


                    “Margin
Stock” means “margin stock” within the meaning of Regulations T, U and X of
the Board.


                    “Markit”
has the meaning set forth in the definition of Credit Default Swap Spread. 


                    “Material
Adverse Effect” means a material adverse effect on: (a) the assets,
business, financial condition or operations of an Account Party and its
Subsidiaries taken as a whole; or (b) the ability of an Account Party to
perform any of its payment or other material obligations under this Agreement.


                    “Moody’s”
means Moody’s Investors Service, Inc., or any successor thereto.


                    “Multiemployer
Plan” means a multiemployer plan as defined in Section 4001(a)(3) of
ERISA.


                    “NAIC”
means the National Association of Insurance Commissioners.


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


                    “NAIC Approved Bank List” has the
meaning assigned to such term in the definition of “NAIC Approved Bank” in this
Section.


                    “Non-Syndicated
Letters of Credit” means letters of credit issued under Section 2.04.


                    “Non-U.S.
Benefit Plan” means any plan, fund (including any superannuation fund) or other
similar program established or maintained outside the United States by any
Account Party or any of their Subsidiaries, with respect to which such Account
Party or such Subsidiary has an obligation to contribute, for the benefit of
employees of such Account Party or such Subsidiary, which plan, fund or other
similar program provides, or results in, the type of benefits described in
Section 3(1) or 3(2) of ERISA, and which plan is not subject to ERISA or the
Code.


14





                    “Obligors”
shall have the meaning assigned to such term in the introductory paragraph of
this Agreement.


                    “Other
Taxes” means any and all present or future stamp or documentary taxes or
any other similar excise or property Taxes, arising from any payment made
hereunder or from the execution, delivery or enforcement of this Agreement or
any other Credit Document, including any interest, additions to tax or
penalties applicable thereto.


                    “Participant”
has the meaning assigned to such term in Section 10.04.


                    “Participant
LC Exposure” means the LC Exposure with respect to Non-Syndicated Letters
of Credit and Participated Letters of Credit.


                    “Participant
Register” has the meaning assigned to such term in Section 10.04(c)(iii).


                    “Participated
Letters of Credit” means letters of credit issued under Section 2.05.


                    “PBGC”
means the Pension Benefit Guaranty Corporation referred to and defined in ERISA
and any successor entity performing similar functions.


                    “Person”
means any natural person, corporation, limited liability company, trust, joint
venture, association, company, partnership, Governmental Authority or other
entity.


                    “Plan”
means any employee pension benefit plan (other than a Multiemployer Plan)
subject to the provisions of Title IV of ERISA or Section 412 of the Code
or Section 302 of ERISA, and in respect of which any Account Party or any
ERISA Affiliate is (or, if such plan were terminated, would under
Section 4069 of ERISA be deemed to be) an “employer” as defined in
Section 3(5) of ERISA.


15






                    “Pricing
Grid” means the table set forth below:


	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 S&P/
 Moody’s

 Rating of

 XLIT

 Senior

 Unsecured

 Long-Term

 Debt

 	
  

 	
 CDS

 Floor

 (for

 Eurodollar

 Loans)

 	
  

 	
 CDS

 Floor

 (for

 ABR

 Loans)

 	
  

 	
 CDS
 Cap

 (for

 Eurodollar

 Loans)

 	
  

 	
 CDS

 Cap 

 (for

 ABR

 Loans)

 	
  

 	
 Commitment

 Fee Rate

 	
  

 	
 Letter
 of Credit

 Commission

 	
  

 
	

 


 	
  

 	

 


 	
  

 	

 


 	
  

 	

 


 	
  

 	

 


 	
  

 	

 


 	
  

 	

 


 	
  

 
	
 Category 1

 > A / A2

 	
  

 	
 0.75%

 	
  

 	
 0.00%

 	
  

 	
 2.50%

 	
  

 	
 1.50%

 	
  

 	
 0.150%

 	
  

 	
 1.125%

 	
  

 
	
  

 
	
 Category
 2

 A- / A3

 	
  

 	
 0.875%

 	
  

 	
 0.00%

 	
  

 	
 2.75%

 	
  

 	
 1.75%

 	
  

 	
 0.175%

 	
  

 	
 1.25%

 	
  

 
	
  

 
	
 Category 3

 BBB+ / Baa1

 	
  

 	
 1.00%

 	
  

 	
 0.00%

 	
  

 	
 3.00%

 	
  

 	
 2.00%

 	
  

 	
 0.200%

 	
  

 	
 1.50%

 	
  

 
	
  

 
	
 Category 4

 BBB / Baa2

 	
  

 	
 1.25%

 	
  

 	
 0.25%

 	
  

 	
 3.50%

 	
  

 	
 2.50%

 	
  

 	
 0.250%

 	
  

 	
 1.75%

 	
  

 
	
  

 
	
 Category 5
< BBB / Baa2

 or unrated

 	
  

 	
 1.50%

 	
  

 	
 0.50%

 	
  

 	
 4.00%

 	
  

 	
 3.00%

 	
  

 	
 0.300%

 	
  

 	
 2.00%

 	
  

 



          For
the purposes of the this definition, if XLIT holds split ratings that are one level apart then the higher of such
ratings shall apply. If XLIT
holds split ratings that are more than one level apart then the rating one
level below the highest of such ratings shall apply.


                    “Prime
Rate” means the rate of interest per annum publicly announced from time to
time by JPMCB as its prime rate 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.


                    “Private
Act” means separate legislation enacted in Bermuda with the intention that
such legislation apply specifically to an Account Party, in whole or in part.


                    “Pro
Rata Share” has the meaning assigned to such term in Section 3.07.


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


16





                    “Register”
has the meaning assigned to such term in Section 10.04.


                    “Reimbursement
Obligation” means the obligation hereunder of the Specified Account Party
to reimburse (i) with respect to any Participated Letter of Credit or
Non-Syndicated Letter of Credit, the Issuing Lender thereof and (ii) with
respect to any Syndicated Letter of Credit or Alternative Currency Letter of
Credit, the Lenders thereof, in each case, for amounts drawn under such Letter
of Credit.


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


                    “Required
Lenders” means, at any time, Lenders having Commitments representing more
than 50% of the aggregate amount of the Commitments at such time; provided
that, if the Commitments have expired or been terminated, “Required Lenders”
means Lenders having more than 50% of the Aggregate Credit Exposure at such
time.


                    “S&P”
means Standard & Poor’s Ratings Services, a division of The McGraw Hill
Companies, Inc., or any successor thereto.


                    “Revaluation
Date” means each of the following: (i) each date of issuance, renewal
or amendment of a Letter of Credit denominated in an Alternative Currency,
(ii) each date of an amendment of any such Letter of Credit having the
effect of increasing the amount thereof (solely with respect to the increased
amount), (iii) each date of any payment by the Specified Account Party
under any Letter of Credit denominated in an Alternative Currency and (iv) such
additional dates as the Administrative Agent or the Issuing Lender shall
determine or the Required Lenders shall require; provided that not more
than four requests in the aggregate may be made in any calendar year pursuant
to this clause (iv).


                    “SAP”
means, as to each Account Party and each Subsidiary that offers insurance
products, the statutory accounting practices prescribed or permitted by the
relevant Governmental Authority for such Account Party’s or such Subsidiary’s
domicile for the preparation of its financial statements and other reports by
insurance corporations of the same type as such Account Party or such Subsidiary
in effect on the date such statements or reports are to be prepared, except if
otherwise notified by XL Group as provided in Section 1.03.


                    “SEC”
means the Securities and Exchange Commission or any successor entity.


                    “Secured
Credit Agreement” means the 4-Year Credit Agreement dated as of December 9,
2011 among the Account Parties, the lenders party thereto, JPMCB, as
administrative agent, and The Bank of New York Mellon, as collateral agent, as
amended, restated, supplemented or otherwise modified from time to time,
including any renewals, extensions or replacements thereof that increase the
principal amount thereof as of the Effective Date; provided, however,
that to the extent such principal amount exceeds $650,000,000 at any time, such
excess amount shall not be deemed to be incurred under the Secured Credit
Agreement for purposes of Section 7.07. 


                    “SFR”
means the Statutory Financial Return of XL Life Ltd.


17





                    “Significant
Subsidiary” means, at any time, each Subsidiary of XL Group that, as of
such time, meets the definition of a “significant subsidiary” under Regulation
S-X of the SEC.


                    “Specified
Account Party” means the Account Party on behalf of which any specific
Letter of Credit was issued to support the obligations of such Account Party.


                    “Specified
Transaction Agreement” means any agreement, contract or documentation with
respect to the following types of transactions: cash pooling arrangements, rate
swap transaction, swap option, basis swap, asset swap, forward rate
transaction, commodity swap, commodity option, equity or equity index swap,
equity or equity index option, bond option, interest rate option, foreign
exchange transaction, cap transaction, floor transaction, collar transaction,
current swap transaction, cross-currency rate swap transaction, currency
option, credit protection transaction, credit swap, credit default swap, credit
default option, total return swap, credit spread transaction, repurchase
transaction, reverse repurchase transaction, buy/sell-back transaction,
securities lending or borrowing transaction, weather index transaction or
forward purchase or sale of a security, commodity or other financial instrument
or interest, and transactions on any commodity futures or other exchanges,
markets and their associated clearing houses (including any option with respect
to any of these transactions).


                    “Spot
Rate” for a currency means the rate determined by the Administrative Agent
or with respect to any Letters of Credit, the Issuing Lender, to be its spot
rate for the purchase of such currency with another currency through its
principal foreign exchange trading office at approximately 11:00 a.m. on the
date two Business Days prior to the date as of which the foreign exchange
computation is made; provided that the Administrative Agent or
the Issuing Lender may obtain such spot rate from another financial institution
designated by the Administrative Agent or the Issuing Lender if it does not
have as of the date of determination a spot buying rate for any such currency;
and provided further the Issuing Lender may use
such spot rate quoted on the date as of which the foreign exchange computation
is made in the case of any Letter of Credit denominated in an Alternative
Currency.


                    “SPV”
has the meaning assigned to such term in Section 10.04.


                    “Stable
Value Instrument” means any insurance, derivative or similar financial
contract or instrument designed to mitigate the volatility of returns during a
given period on a specified portfolio of securities held by one party (the “customer”)
through the commitment of the other party (the “SVI provider”) to
provide the customer with a credited rate of return on the portfolio, typically
determined through an interest-crediting mechanism (and in exchange for which
the SVI provider typically receives a fee).


                    “Statutory
Reserve Rate” means, for any day (or for the Interest Period for any
Eurodollar Borrowing), a fraction (expressed as a decimal), the numerator of
which is the number one and the denominator of which is the number one minus
the aggregate of the maximum reserve percentages (including any marginal, special,
emergency or supplemental reserves) expressed as a decimal established by the
Board to which the Administrative Agent is subject on such day (or, with
respect to an Interest Period, the denominator of which is the number one minus
the arithmetic mean of such aggregates for the days in such Interest Period)
with respect to the Adjusted LIBO Rate, for eurocurrency funding (currently
referred to as 


18





“Eurocurrency
liabilities” in Regulation D of the Board). Such reserve percentages shall
include those imposed pursuant to such Regulation D. The Statutory Reserve
Rate shall be adjusted automatically on and as of the effective date of any
change in any reserve percentage.


                    “Subsidiary”
means, with respect to any Person (the “parent”), at any date, any
corporation (or similar entity) of which a majority of the shares of
outstanding capital stock normally entitled to vote for the election of
directors (regardless of any contingency which does or may suspend or dilute
the voting rights of such capital stock) is at such time owned directly or
indirectly by the parent or one or more subsidiaries of the parent. Unless otherwise specified, “Subsidiary”
means a Subsidiary of an Account Party.


                    “Supplemental
Commitment Date” has the meaning assigned to such term in Section 2.11(c).


                    “Supplemental
Lender” has the meaning assigned to such term in Section 2.11(c).


                    “Syndicated
Letters of Credit” means letters of credit issued under Section 2.01.


                    “Taxes”
means any and all present or future taxes, levies, imposts, duties, deductions,
charges or withholdings imposed by any Governmental Authority, including any
interest, additions to tax or penalties applicable thereto.


                    “Total
Funded Debt” means, at any time, all Indebtedness of XL Group and its
Subsidiaries and any other Person which would at such time be classified in
whole or in part as a liability on the consolidated balance sheet of XL Group
and its consolidated Subsidiaries in accordance with GAAP (it being understood
for avoidance of doubt that any liability or obligation excluded from the
definition of Indebtedness shall not constitute Indebtedness for purposes of
this definition).


                    “Transactions”
means the execution, delivery and performance by the Obligors of this Agreement
and the other Credit Documents to which any Account Party is intended to be a
party, the issuance of Letters of Credit and the borrowing of Loans.


                    “Type”,
when used in reference to any Loan or Borrowing, refers to whether the rate of
interest on such Loan, or on the Loans constituting such Borrowing, is
determined by reference to the Adjusted LIBO Rate or the Alternate Base Rate.


                    “Withdrawal
Liability” means liability to a Multiemployer Plan as a result of a
complete or partial withdrawal from such Multiemployer Plan, as such terms are
defined in Part I of Subtitle E of Title IV of ERISA.


                    “Withholding
Agent” means any Obligor and the Administrative Agent.


                    SECTION
1.02. Terms Generally. The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words “include”, “includes” and “including”
shall be deemed to be followed by the phrase “without limitation”. The word
“will” shall be construed to have the same meaning and effect as the word 


19





“shall”.
Unless the context requires otherwise (a) any definition of or reference
to any agreement, instrument, statute, law, rule, regulation or other document
herein shall be construed as referring to such agreement, instrument, statute,
law, rule, regulation or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any
reference herein to any Person shall be construed to include such Person’s
successors and assigns, (c) the words “herein”, “hereof” and “hereunder”,
and words of similar import, shall be construed to refer to this Agreement in
its entirety and not to any particular provision hereof, (d) all references
herein to Articles, Sections, Exhibits and Schedules shall be construed to
refer to Articles and Sections of, and Exhibits and Schedules to, this
Agreement and (e) the words “asset” and “property” shall be construed to
have the same meaning and effect and to refer to any and all tangible and
intangible assets and properties, including cash, securities, accounts and
contract rights.


                    SECTION
1.03. Accounting Terms; GAAP, Local GAAP, SAP and SFR. Except as
otherwise expressly provided herein, all terms of an accounting or financial
nature shall be construed in accordance with GAAP, Local GAAP, SAP or SFR, as
the context requires, each as in effect from time to time; provided
that, if XL Group notifies the Administrative Agent that the Account Parties
request an amendment to any provision hereof to eliminate the effect of any
change occurring after the date hereof in GAAP, Local GAAP, SAP or SFR, as the
case may be, or in the application thereof on the operation of such provision
(or if the Administrative Agent notifies the Account Parties that the Required
Lenders request an amendment to any provision hereof for such purpose),
regardless of whether any such notice is given before or after such change in
GAAP, Local GAAP, SAP or SFR, as the case may be, or in the application
thereof, then such provision shall be interpreted on the basis of GAAP, Local
GAAP, SAP or SFR, as the case may be, as in effect and applied immediately
before such change shall have become effective until such notice shall have
been withdrawn or such provision amended in accordance herewith.


                    SECTION
1.04. Exchange Rates; Currency Equivalents


 (a) The Administrative Agent or the Issuing
Lender, as applicable, shall determine the Spot Rates as of each Revaluation
Date to be used for calculating Dollar Equivalent amounts of Letters of Credit
denominated in Alternative Currencies. Such Spot Rates shall become effective
as of such Revaluation Date and shall be the Spot Rates employed in converting
any amounts between the applicable currencies until the next Revaluation Date
to occur. Except for purposes of financial statements delivered by Obligors
hereunder or calculating financial covenants hereunder or except as otherwise
provided herein, the applicable amount of any currency (other than Dollars) for
purposes of the Credit Documents shall be such Dollar Equivalent amount as so
determined by the Administrative Agent or the Issuing Lender, as applicable.


(b) Wherever
in this Agreement in connection with the issuance, amendment or extension of a
Letter of Credit, an amount, such as a required minimum or multiple amount, is
expressed in Dollars, but such Letter of Credit is denominated in an
Alternative Currency, such amount shall be the relevant Alternative Currency
Equivalent of such Dollar amount, as determined by the Administrative Agent or
the Issuing Lender, as the case may be.


20





ARTICLE II


THE CREDITS


                    SECTION
2.01. Syndicated Letters of Credit.


                    (a)
General. Subject to the terms and conditions set forth herein, at the
request of any Account Party the Lenders agree at any time and from time to
time during the Availability Period to issue Syndicated Letters of Credit for
the account of such Account Party in an aggregate amount that will not result
in the Aggregate Credit Exposure exceeding the Commitments (it being understood
that Syndicated Letters of Credit may be issued, or be outstanding, for the account
of more than one of the Account Parties at any time). Each Syndicated Letter
of Credit shall be in such form as is consistent with the requirements of the
applicable regulatory authorities as reasonably required by the Administrative
Agent (in consultation with XL Group) or as otherwise agreed to by the Administrative
Agent and XL Group; provided that, without the prior consent of each
Lender, no Syndicated Letter of Credit may be issued that would vary the
several and not joint nature of the obligations of the Lenders thereunder as
provided in the next succeeding sentence. Each Syndicated Letter of Credit
shall be issued by all of the Lenders, acting through the Administrative Agent,
at the time of issuance as a single multi-bank letter of credit, but the
obligation of each Lender thereunder shall be several and not joint, based upon
its Applicable Percentage of the aggregate undrawn amount of such Syndicated
Letter of Credit.


                    (b)
Notice of Issuance, Amendment, Renewal or Extension. To request the issuance
of a Syndicated Letter of Credit (or the amendment, renewal or extension of an
outstanding Syndicated 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
(reasonably in advance of the requested date of issuance, amendment, renewal or
extension) a notice requesting the issuance of a Syndicated Letter of Credit,
or identifying the Syndicated 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
Syndicated Letter of Credit is to expire (which shall comply with
paragraph (d) of this Section), the amount of such Syndicated 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 Syndicated Letter of Credit.
If any Syndicated 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 by the Required Lenders in a notice given to the
Administrative Agent not more than 60 days, but not less than 45 days, prior to
the current expiry date of such Syndicated Letter of Credit. If requested by
the Administrative Agent, such Account Party also shall submit a letter of
credit application on JPMCB’s standard form in connection with any request for
a Syndicated 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 such Account
Party to, or entered into by such Account Party with, the Administrative Agent
relating to a Syndicated Letter of Credit, the terms and conditions of 


21





this Agreement
shall control.


                    (c)
Limitations on Amounts. A Syndicated Letter of Credit shall be issued,
amended, renewed or extended only if (and upon such issuance, amendment,
renewal or extension of each Syndicated Letter of Credit XL Group shall be
deemed to represent and warrant that), after giving effect to such issuance,
amendment, renewal or extension, (i) the Aggregate Credit Exposure of the Lenders shall not
exceed the aggregate amount of the Commitments and (ii) the Credit
Exposure (excluding any Alternative Currency LC Exposure) of each Lender shall
not exceed the Commitment of such Lender.


                    (d)
Expiry Date. Each Syndicated Letter of Credit shall expire at or prior
to the close of business on the date one year after the date of the issuance of
such Syndicated Letter of Credit (or, in the case of any renewal or extension
thereof, one year after such renewal or extension); provided that in no
event shall any Syndicated Letter of Credit have an expiry date later than the
first anniversary of the Commitment Termination Date.


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


                    (f)
Adjustment of Applicable Percentages. Upon (i) each increase of the
Commitments pursuant to Section 2.11(c) or (ii) the assignment by a Lender
of all or a portion of its Commitment and its interests in the Syndicated
Letters of Credit pursuant to an Assignment and Assumption, the Administrative
Agent shall promptly notify each beneficiary under an outstanding Syndicated
Letter of Credit of the Lenders that are parties to such Syndicated Letter of
Credit and their respective Applicable Percentages as of the effective date of,
and after giving effect to, such increase or assignment, as the case may be.


                    (g)
Continuation of Existing Syndicated Letters of Credit. Subject to the
terms and conditions hereof, each Syndicated Letter of Credit under (and as
defined in) the Existing Unsecured Credit Agreement which is outstanding on the
Effective Date and listed on Schedule VI as a “Syndicated Letter of Credit”
shall automatically be deemed continued hereunder by all of the Lenders having
Commitments on the Effective Date. The obligation of each such Lender in
respect of each such continued Syndicated Letter of Credit shall be several and
not joint, based upon its Applicable Percentage and the aggregate undrawn
amount thereof, and each such Syndicated Letter of Credit shall be deemed a
Syndicated Letter of Credit for all purposes of this Agreement as of the
Effective Date. The Administrative Agent shall, on the Effective Date or as
promptly as practicable thereafter, notify the beneficiary of each such
Syndicated Letter of Credit that is being continued hereunder as to the names
of the Lenders that, as of the Effective Date, will be issuing lenders under,
and party to, such Syndicated Letter of Credit and the Lenders’ respective
Applicable Percentages thereunder as of the Effective Date.


                    SECTION
2.02. Issuance and Administration. Each Syndicated 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, each Lender party to such Syndicated
Letter of Credit, and the 


22





Administrative
Agent shall act under each Syndicated Letter of Credit, and each Syndicated
Letter of Credit shall expressly provide that the Administrative Agent shall
act, as the agent of each Lender to (a) receive drafts, other demands for
payment and other documents presented by the beneficiary under such Syndicated
Letter of Credit, (b) determine whether such drafts, demands and documents are
in compliance with the terms and conditions of such Syndicated Letter of Credit
and (c) notify such Lender and the Account Parties 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 Syndicated Letter of Credit, and each Syndicated Letter
of Credit shall expressly so provide. Each Lender hereby irrevocably appoints
and designates the Administrative Agent as its attorney-in-fact, acting through
any duly authorized officer of JPMCB, to execute and deliver in the name and on
behalf of such Lender each Syndicated Letter of Credit to be issued by such
Lender hereunder. Promptly upon the request of the Administrative Agent, each
Lender will furnish to the Administrative Agent such powers of attorney or
other evidence as any beneficiary of any Syndicated 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 Lender to execute and deliver
such Syndicated Letter of Credit. Notwithstanding anything in this Agreement to
the contrary, the Administrative Agent has no responsibility hereunder with
respect to the issuance, renewal, extension, amendment or other administration
of any Alternative Currency Letter of Credit, except as expressly set forth in
Section 2.06.


                    SECTION
2.03. Reimbursement of LC Disbursements, Etc.


                    (a)
Reimbursement. If any Lender shall make any LC Disbursement in respect
of any Syndicated Letter of Credit or Alternative Currency Letter of Credit,
the Specified Account Party with respect thereto agrees to reimburse such
Lender in respect of such LC Disbursement under (x) a Syndicated Letter of
Credit by paying to the Administrative Agent an amount equal to such LC
Disbursement not later than 2:00 p.m., New York City time, on (i) the
Business Day that the Account Parties receive 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 Account
Parties receive such notice, if such notice is not received prior to such time
and (y) an Alternative Currency Letter of Credit, by paying such Lender on
the date, in the currency and amount thereof, together with interest thereon
(if any), and in the manner (including the place of payment) as such Lender and
such Specified Account Party shall have separately agreed pursuant to Section
2.06. It is understood that the Account Parties may elect to use the proceeds
of a borrowing pursuant to Section 2.08 to finance its Reimbursement
Obligations pursuant to this Section 2.03(a). 


                    (b)
Obligations Absolute. The several obligations of the Specified Account
Party with respect to any Letter of Credit to reimburse LC Disbursements in
respect thereof as provided in paragraph (a) of this Section 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 Syndicated Letter of Credit or any term or provision therein,
(ii) any draft or other document presented under a Syndicated 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 Syndicated Letter of Credit against presentation of a draft or other
document that does not 


23





comply
strictly with the terms of such Syndicated Letter of Credit (provided
that such Specified Account Party shall not be obligated to reimburse such LC
Disbursements unless payment is made against presentation of a draft or other
document that at least substantially complies with the terms of such Syndicated
Letter of Credit), (iv) the occurrence of any Default or (v) any other
event or circumstance whatsoever, whether or not similar to any of the
foregoing, that might, but for the provisions of this Section, constitute a
legal or equitable discharge of the obligations of such Specified Account Party
hereunder.


                    Neither
the Administrative Agent, nor any Lender nor any of their respective Related
Parties shall have any liability or responsibility by reason of or in
connection with the issuance or transfer of any Syndicated Letter of Credit or
any payment or failure to make any payment thereunder (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 Syndicated 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 Lender from liability to the
Account Parties 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 the
Account Parties that are caused by the gross negligence or willful misconduct of
the Administrative Agent or a Lender. 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 Syndicated 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 Syndicated 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 Syndicated 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 Syndicated 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 Syndicated Letter of Credit. The
Administrative Agent shall promptly after such examination (i) notify each
of the Lenders and the Specified Account Party with respect to such Letter of Credit
by telephone (confirmed by telecopy or email) of such demand for payment and
(ii) deliver to each Lender a copy of each document purporting to
represent a demand for payment under such Syndicated Letter of Credit. With
respect to any drawing properly made under a Syndicated Letter of Credit, each
Lender will make an LC 


24





Disbursement
in respect of such Syndicated Letter of Credit in accordance with its liability
under such Syndicated 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 Lenders. The Administrative Agent will
make any such LC Disbursement available to the beneficiary of such Syndicated
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 Lender in respect of
any Syndicated Letter of Credit, the Administrative Agent will notify the
Account Parties of such LC Disbursement; provided that any failure to
give or delay in giving such notice shall not relieve such Specified Account
Party of its obligation to reimburse the Lenders with respect to any such LC
Disbursement.


                    (d)
Interim Interest. If any LC Disbursement with respect to a Syndicated
Letter of Credit is made, then, unless such LC Disbursement is reimbursed in
full on the date such LC Disbursement is made, the unpaid amount thereof shall
bear interest, subject to Section 2.15(c), for each day from and including the
date such LC Disbursement is made to but excluding the date that such LC
Disbursement is reimbursed, at the rate per annum equal to 1% plus the
Alternate Base Rate.


                    SECTION
2.04. Non-Syndicated Letters of Credit.


                    (a)
General. Subject to the terms and conditions set forth herein, at the
request of any Account Party the Lenders agree at any time and from time to
time during the Availability Period to issue Non-Syndicated Letters of Credit
for the account of such Account Party in an aggregate amount that will not
result in the Aggregate Credit Exposure exceeding the Commitments (it being understood
that Non-Syndicated Letters of Credit may be issued, or be outstanding, for the
account of more than one of the Account Parties at any time). Each Non-Syndicated
Letter of Credit shall be in such form as is consistent with the requirements
of the applicable regulatory authorities in the jurisdiction of issue as reasonably
determined by the Administrative Agent or as otherwise agreed to by the
Administrative Agent and XL Group. Each Non-Syndicated Letter of Credit shall
be issued by the respective Issuing Lender thereof, through the Administrative
Agent as provided in Section 2.04(c), in the amount of such Issuing Lender’s
Applicable Percentage of the aggregate amount of Non-Syndicated Letters of
Credit being requested by such Account Party at such time, and (notwithstanding
anything herein or in any other Letter of Credit Document to the contrary) such
Non-Syndicated Letter of Credit shall be the sole responsibility of such
Issuing Lender (and of no other Person, including any other Lender or the
Administrative Agent). Notwithstanding anything to the contrary in this
Agreement, no Non-Syndicated Letter of Credit may be requested hereunder for
any jurisdiction unless XL Group provides evidence reasonably satisfactory to
the Administrative Agent that Syndicated Letters of Credit do not comply with
the insurance laws of such jurisdiction.


                    (b)
Notice of Issuance, Amendment, Renewal or Extension. To request the
issuance of Non-Syndicated Letters of Credit (or the amendment, renewal or
extension of outstanding Non-Syndicated Letters 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 (reasonably in advance of the requested 


25





date of
issuance, amendment, renewal or extension) a notice requesting the issuance of
Non-Syndicated Letters of Credit, or identifying the Non-Syndicated Letters 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 Non-Syndicated Letters of Credit are to expire
(which shall comply with paragraph (e) of this Section), the aggregate
amount of all Non-Syndicated Letters of Credit to be issued in connection with
such request, 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 Non-Syndicated Letters of
Credit. If Non-Syndicated Letters of Credit issued in connection with the same
request shall provide for the automatic extension of the expiry date thereof
unless the Issuing Lender thereof or the Administrative Agent gives notice that
such expiry date shall not be extended, then the Administrative Agent (acting
on behalf of the relevant Issuing Lenders) will give such notice for all such
Non-Syndicated Letters of Credit if requested to do so by the Required Lenders
in a notice given to the Administrative Agent not more than 60 days, but not
less than 45 days, prior to the current expiry date of such Non-Syndicated
Letter of Credit. If requested by the Administrative Agent, such Account Party
also shall submit a letter of credit application on JPMCB’s standard form in
connection with any request for a Non-Syndicated 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 such Account Party to, or entered into by such Account
Party with, the Administrative Agent (acting on behalf of the relevant Issuing
Lenders) relating to a Non-Syndicated Letter of Credit, the terms and
conditions of this Agreement shall control.


                    (c)
Issuance and Administration. Each Non-Syndicated Letter of Credit shall
be executed and delivered by the Administrative Agent (which term, for purposes
of this Section 2.04 and any other provisions of this Agreement, including
Article IX and Section 10.03, relating to Non-Syndicated Letters of Credit,
shall be deemed to refer to, unless the context otherwise requires, JPMCB
acting in its capacity as the Administrative Agent or in its individual
capacity, in either case as attorney-in-fact for the respective Issuing
Lender), acting through any duly authorized officer of JPMCB, in the name and
on behalf of, and as attorney-in-fact for, the Issuing Lender party to such
Non-Syndicated Letter of Credit. With respect to each Non-Syndicated Letter of
Credit, the Administrative Agent shall act in the name and on behalf of, and as
attorney-in-fact for, the Lender issuing such Non-Syndicated Letter of Credit
and in that capacity shall, and each Lender hereby irrevocably appoints and
designates the Administrative Agent, acting through any duly authorized officer
of JPMCB, to so act in the name and on behalf of, and as attorney-in-fact for,
each Lender with respect to each Non-Syndicated Letter of Credit to be issued
by such Lender hereunder and, without limiting any other provision of this
Agreement, to, (i) execute and deliver in the name and on behalf of such Lender
each Non-Syndicated Letter of Credit to be issued by such Lender hereunder, (ii)
receive drafts, other demands for payment and/or other documents presented by
the beneficiary thereunder, (iii) determine whether such drafts, demands and/or
documents are in compliance with the terms and conditions thereof, (iv) notify
the beneficiary of any such Non-Syndicated Letter of Credit of the expiration
or non-renewal thereof in accordance with the terms thereof, (v) advise such
beneficiary of any change in the office for presentation of drafts under any
such Non-Syndicated Letter of Credit, (vi) enter into with the Specified
Account Party any such letter of credit application or similar agreement with
respect to any such Non-Syndicated Letter of Credit as the Administrative Agent
shall require, (vii) remit to the beneficiary of any such Non-Syndicated 


26





Letter of
Credit any payment made by such Lender and received by the Administrative Agent
in connection with a drawing thereunder, (viii) perform any and all other acts
which in the sole opinion of the Administrative Agent may be necessary or incidental
to the performance of the powers herein granted with respect to such
Non-Syndicated Letter of Credit, (ix) notify such Lender and the Specified
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
Non-Syndicated Letter of Credit and (x) delegate to any agent of JPMCB and such
agent’s Related Parties, or any of them, the performance of any of such powers.
Each Lender hereby ratifies and confirms (and undertakes to ratify and confirm
from time to time upon the request of the Administrative Agent) whatsoever the
Administrative Agent (or any Related Party thereof) shall do or purport to do
by virtue of the power herein granted. Promptly upon the request of the
Administrative Agent, each Lender will furnish to the Administrative Agent such
powers of attorney or other evidence as any beneficiary of any Non-Syndicated
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 Lender
with respect to such Non-Syndicated Letter of Credit (together with such
evidence of the due authorization, execution, delivery and validity of such
power of attorney as the Administrative Agent may reasonably request). Without
limiting any provision of Article IX, the Administrative Agent may perform any
and all of its duties and exercise any and all of its rights and powers under
this Section through its Related Parties.


                    (d)
Limitations on Amounts. Non-Syndicated Letters of Credit shall be
issued, amended, renewed or extended only if (and upon such issuance,
amendment, renewal or extension of each Non-Syndicated Letter of Credit XL
Group shall be deemed to represent and warrant that), after giving effect to
such issuance, amendment, renewal or extension, (i) the Aggregate Credit
Exposure of the Lenders shall
not exceed the aggregate amount of the Commitments and (ii) the Credit
Exposure (excluding any Alternative Currency LC Exposure) of each Lender shall
not exceed the Commitment of such Lender.


                    (e)
Expiry Date. Each Non-Syndicated Letter of Credit shall expire at or
prior to the close of business on the date one year after the date of the
issuance of such Non-Syndicated Letter of Credit (or, in the case of any
renewal or extension thereof, one year after such renewal or extension); provided
that in no event shall any Non-Syndicated Letter of Credit have an expiry date
later than the first anniversary of the Commitment Termination Date.


                    (f)
Participations. By the issuance of a Non-Syndicated Letter of Credit (or
an amendment to a Non-Syndicated Letter of Credit increasing the amount
thereof) by the respective Issuing Lender, and without any further action on
the part of such Issuing Lender or the Lenders, such Issuing Lender hereby
grants to each Lender (other than the Issuing Lender itself), and each such
Lender hereby acquires from such Issuing Lender, a participation in such
Non-Syndicated Letter of Credit equal to such Lender’s Applicable Percentage of
the aggregate amount available to be drawn under such Non-Syndicated Letter of
Credit. The obligation of each Lender under
a Non-Syndicated Letter of Credit shall be several and not joint. Each Lender acknowledges and agrees that its obligation to
acquire participations pursuant to this paragraph in respect of Non-Syndicated Letter
of Credit is absolute and unconditional and shall not be 


27





affected by
any circumstance whatsoever, including any amendment, renewal or extension of
any Non-Syndicated Letter of Credit or the occurrence and continuance of a
Default or reduction or termination of the Commitments. In consideration and in
furtherance of the foregoing, each Lender hereby absolutely and unconditionally
agrees to pay to the Administrative Agent, for account of the respective
Issuing Lender, such Lender’s Applicable Percentage of each LC Disbursement
made by an Issuing Lender in respect of any Non-Syndicated Letter of Credit
promptly upon the request of the Administrative Agent at any time from the time
such LC Disbursement is made until such LC Disbursement is reimbursed by the
Specified Account Party or at any time after any reimbursement payment is
required to be refunded to the Specified Account Party for any reason. Such
payment shall be made without any offset, abatement, withholding or reduction
whatsoever. Promptly following receipt by the Administrative Agent of any
payment from the Specified Account Party pursuant to the next following
paragraph, the Administrative Agent shall distribute such payment to the
respective Issuing Lender or, to the extent that the Lenders have made payments
pursuant to this paragraph to reimburse such Issuing Lender, then to such
Lenders and such Issuing Lender as their interests may appear. Any payment made
by a Lender pursuant to this paragraph to reimburse an Issuing Lender for any LC Disbursement
shall not relieve the Specified Account Party of its obligation to reimburse
such LC Disbursement.


                    (g)
Reimbursement. If any Issuing Lender shall make any LC Disbursement in
respect of any Non-Syndicated Letter of Credit, the Specified Account Party
with respect thereto agrees to reimburse such Issuing Lender in respect of such
LC Disbursement by paying to the Administrative Agent an amount equal to such
LC Disbursement not later than 2:00 p.m., New York City time, on (i) the
Business Day that the Account Parties receive 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 Account
Parties receive such notice, if such notice is not received prior to such time.
It is understood that the Account Parties may elect to use the proceeds of a
borrowing pursuant to Section 2.08 to finance its Reimbursement Obligations
pursuant to this Section 2.04(g).


                    If the
Specified Account Party fails to make such payment when due, the Administrative
Agent shall notify each Lender of the applicable LC Disbursement, the payment
then due from the Specified Account Party in respect thereof and such Lender’s
Applicable Percentage thereof.


                    (h)
Obligations Absolute. The several obligations of the Specified Account
Party with respect to any Letter of Credit to reimburse LC Disbursements in
respect of any Non-Syndicated Letter of Credit as provided in
paragraph (g) of this Section 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 Non-Syndicated Letter of
Credit, or any term or provision therein, (ii) any draft or other document
presented under a Non-Syndicated 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 by the Issuing Lender under a
Non-Syndicated Letter of Credit against presentation of a draft or other
document that does not comply strictly with the terms of such Non-Syndicated
Letter of Credit (provided that such Specified Account Party shall not
be obligated to reimburse such LC Disbursements unless payment is made against 


28





presentation
of a draft or other document that at least substantially complies with the
terms of such Non-Syndicated Letter of Credit), (iv) the occurrence of any
Default or (v) any other event or circumstance whatsoever, whether or not
similar to any of the foregoing, that might, but for the provisions of this
Section, constitute a legal or equitable discharge of the obligations of such
Specified Account Party hereunder.


                    Neither
the Administrative Agent, the Lenders nor any Issuing Lender, nor any of their
respective Related Parties, shall have any liability or responsibility by
reason of or in connection with the payment or failure to make any payment
under a Non-Syndicated Letter of Credit (irrespective of any of the
circumstances referred to in the preceding sentence) as a result of determining
whether drafts or other documents presented under a Non-Syndicated Letter of
Credit comply with the terms thereof, or any error, omission, interruption,
loss or delay in transmission or delivery of any draft, notice or other
communication under or relating to any Non-Syndicated 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
the control of an Issuing Lender; provided that the foregoing shall not
be construed to excuse the Administrative Agent or a Lender from liability to
the Account Parties 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 the
Account Parties that are caused by the gross negligence or willful misconduct
of the Administrative Agent or a Lender when determining whether drafts and
other documents presented under a Non Syndicated Letter of Credit comply with
the terms hereof. 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 Non-Syndicated 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 Non-Syndicated 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 Non-Syndicated 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 Non-Syndicated 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).

 



                    (i)
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 Non-Syndicated Letter of Credit.
The Administrative Agent shall promptly after such examination (i) notify
each of the Lenders and the Specified Account Party with respect to such Letter
of Credit by telephone (confirmed by telecopy or email) of such demand for
payment and (ii) deliver to each Lender (including the Issuing Lender) a
copy of 


29





each document
purporting to represent a demand for payment under such Non-Syndicated Letter
of Credit. With respect to any drawing properly made under a Non-Syndicated Letter
of Credit, the Issuing Lender thereof will make an LC Disbursement in respect
of such Non-Syndicated Letter of Credit in accordance with its liability under
such Non-Syndicated 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 Lenders. The Administrative Agent will
make any such LC Disbursement available to the beneficiary of such
Non-Syndicated 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 Issuing
Lender in respect of any Non-Syndicated Letter of Credit, the Administrative
Agent will notify the Account Parties of such LC Disbursement; provided
that any failure to give or delay in giving such notice shall not relieve the
Specified Account Party of its obligation to reimburse such Issuing Lender with
respect to any such LC Disbursement.


                    (j)
Interim Interest. If any LC Disbursement with respect to a
Non-Syndicated Letter of Credit is made, then, unless such LC Disbursement is
reimbursed in full on the date such LC Disbursement is made, the unpaid amount
thereof shall bear interest, subject to Section 2.15(c), for each day from and
including the date such LC Disbursement is made to but excluding the date that
such LC Disbursement is reimbursed, at the rate per annum equal to 1% plus
the Alternate Base Rate.


                    
(k) Adjustments to Non-Syndicated Letters of Credit. Upon each increase
of the Commitments pursuant to Section 2.11(c), (i) each Non-Syndicated Letter
of Credit then outstanding hereunder shall, as of the effective date of such
increase, be amended by the respective Issuing Lenders thereof (through the
Administrative Agent) to reflect the Lenders having Commitments after giving
effect to such increase and having, with respect to each such Non-Syndicated
Letter of Credit issued by an existing Lender, a face amount based upon such
Lender’s Applicable Percentage of such Commitments and/or (ii) as applicable,
new Non-Syndicated Letters of Credit shall be issued hereunder as of such
effective date by each Supplemental Lender which has undertaken a new or
incremental Commitment in connection with such increase in a face amount based
upon such Supplemental Lender’s Applicable Percentage of such Commitments.
Upon the assignment by a Lender of all or a portion of its Commitment and
its interests in the Non-Syndicated Letters of Credit pursuant to an Assignment
and Assumption, (i) XL Group shall, at the reasonable request of the
Administrative Agent, execute such documents as may be necessary in connection
with amendments to each Non-Syndicated Letter of Credit issued by such
assigning Lender then outstanding hereunder (or to replace each such
Non-Syndicated Letter of Credit with a new Non-Syndicated Letter of Credit of
such assigning Lender) to reflect such assigning Lender’s Commitment and with a
face amount based upon such Lender’s Applicable Percentage after giving effect
to such assignment and/or (ii) as applicable, a new Non-Syndicated Letter of
Credit shall be issued hereunder as of the effective date of such assignment by
the assignee Lender which has undertaken a new or incremental Commitment in
connection with such assignment in a face amount based upon such assignee
Lender’s Applicable Percentage of the Commitments after giving effect to such
assignment.


30






                    (l)
Continuation of Existing Non-Syndicated Letters of Credit. Subject to
the terms and conditions hereof, each Non-Syndicated Letter of Credit under
(and as defined in) the Existing Unsecured Credit Agreement which is
outstanding on the Effective Date and listed on Schedule VI as a
“Non-Syndicated Letter of Credit” shall, effective as of the Effective Date, be
deemed continued hereunder and shall be amended by the respective Issuing
Lender (through the Administrative Agent) to reflect (i) the Lenders having
Commitments as of the Effective Date and (ii) with respect to each such
Non-Syndicated Letter of Credit issued by a Lender that is party to the
Existing Unsecured Credit Agreement, a face amount based upon the respective
Lender’s Applicable Percentage as in effect on the Effective Date, and each
such Non-Syndicated Letter of Credit, as so amended, shall be deemed continued
hereunder as a Non-Syndicated Letter of Credit issued by such Lender for all
purposes of this Agreement as of the Effective Date.


                    SECTION
2.05. Participated Letters of Credit.


                    (a)
General. Subject to the terms and conditions set forth herein, any
Account Party may request the Issuing Lender to issue, at any time and from
time to time during the Availability Period, Participated Letters of Credit for
its own account. Each Participated Letter of Credit shall be in such form as is
consistent with the requirements of the applicable regulatory authorities
reasonably required by the Administrative Agent (in consultation with XL Group)
or as otherwise agreed to by the Administrative Agent and XL Group.
Participated Letters of Credit issued hereunder shall constitute utilization of
the Commitments.


                    (b)
Notice of Issuance, Amendment, Renewal or Extension. To request the
issuance of a Participated Letter of Credit (or the amendment, renewal or
extension of an outstanding Participated 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 Issuing Lender) to the
Issuing Lender and the Administrative Agent (reasonably in advance of the
requested date of issuance, amendment, renewal or extension) a notice
requesting the issuance of a Participated Letter of Credit, or identifying the
Participated Letter of Credit to be amended, renewed or extended, and
specifying the date of issuance, amendment, renewal or extension (which shall
be a Business Day), the date on which such Participated Letter of Credit is to
expire (which shall comply with paragraph (d) of this Section), the amount
of such Participated Letter of Credit, the name and address of the beneficiary
thereof and such other information as shall be necessary to prepare, amend,
renew or extend such Participated Letter of Credit. If Participated Letters of
Credit issued in connection with the same request shall provide for the
automatic extension of the expiry date thereof unless the Issuing Lender
thereof or the Administrative Agent gives notice that such expiry date shall
not be extended, then the Administrative Agent (acting on behalf of the
relevant Issuing Lender) will give such notice for all such Participated
Letters of Credit if requested to do so by the Issuing Lender in a notice given
to the Administrative Agent not more than 60 days, but not less than 45 days,
prior to the current expiry date of such Participated Letter of Credit. If
requested by the Issuing Lender, such Account Party also shall submit a letter of
credit application on the Issuing Lender’s standard form in connection with any
request for a Participated 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 the
Account Party to, 


31





or entered
into by such Account Party with, the Issuing Lender relating to a Participated
Letter of Credit, the terms and conditions of this Agreement shall control.


                    (c)
Limitations on Amounts. A Participated Letter of Credit shall be issued,
amended, renewed or extended only if (and upon issuance, amendment, renewal or
extension of each Participated Letter of Credit XL Group shall be deemed to
represent and warrant that), after giving effect to such issuance, amendment,
renewal or extension (i) the Aggregate Credit Exposure of the Lenders shall not exceed the aggregate
amount of the Commitments and (ii) the Credit Exposure (excluding any
Alternative Currency LC Exposure) of the Issuing Lender (determined for these
purposes without giving effect to the participations therein of the Lenders
pursuant to paragraph (e) of this Section) shall not exceed the Commitment
of such Issuing Lender.


                    (d)
Expiry Date. Each Participated Letter of Credit shall expire at or prior
to the close of business on the date one year after the date of the issuance of
such Participated Letter of Credit (or, in the case of any renewal or extension
thereof, one year after such renewal or extension); provided that in no
event shall any Participated Letter of Credit have an expiry date later than
the first anniversary of the Commitment Termination Date.


                    (e)
Participations. By the issuance of a Participated Letter of Credit (or
an amendment to a Participated Letter of Credit increasing the amount thereof)
by the Issuing Lender, and without any further action on the part of the
Issuing Lender or the Lenders, the Issuing Lender hereby grants to each Lender,
and each Lender hereby acquires from the Issuing Lender, a participation in
such Participated Letter of Credit equal to such Lender’s Applicable Percentage
of the aggregate amount available to be drawn under such Participated Letter of
Credit. The obligation of each Lender under
a Participated Letter of Credit shall be several and not joint. Each
Lender acknowledges and agrees that its obligation to acquire participations
pursuant to this paragraph in respect of Participated Letters of Credit is
absolute and unconditional and shall not be affected by any circumstance
whatsoever, including any amendment, renewal or extension of any Participated
Letter of Credit or the occurrence and continuance of a Default or reduction or
termination of the Commitments. In consideration and in furtherance of the
foregoing, each Lender hereby absolutely and unconditionally agrees to pay to
the Administrative Agent, for account of the Issuing Lender, such Lender’s
Applicable Percentage of each LC Disbursement made by the Issuing Lender in
respect of any Participated Letter of Credit promptly upon the request of the
Issuing Lender at any time from the time such LC Disbursement is made until
such LC Disbursement is reimbursed by the Specified Account Party or at any
time after any reimbursement payment is required to be refunded to the
Specified Account Party for any reason. Such payment shall be made without any
offset, abatement, withholding or reduction whatsoever. Promptly following
receipt by the Administrative Agent of any payment from the Specified Account
Party pursuant to the next following paragraph, the Administrative Agent shall
distribute such payment to the Issuing Lender or, to the extent that the
Lenders have made payments pursuant to this paragraph to reimburse the Issuing
Lender, then to such Lenders and the Issuing Lender as their interests may
appear. Any payment made by a Lender pursuant to this paragraph to reimburse
the Issuing Lender for any LC Disbursement shall not relieve the Specified
Account Party of its obligation to reimburse such LC Disbursement.


32





                    (f)
Reimbursement. If any Lender shall make any LC Disbursement in respect
of any Participated Letter of Credit, the Specified Account Party with respect
thereto agrees to reimburse such Lender in respect of such LC Disbursement by
paying to the Administrative Agent an amount equal to such LC Disbursement not
later than 2:00 p.m., New York City time, on (i) the Business Day that the
Account Parties receive 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 Account Parties receive
such notice, if such notice is not received prior to such time. It is
understood that the Account Parties may elect to use the proceeds of a
borrowing pursuant to Section 2.08 to finance its Reimbursement Obligations
pursuant to this Section 2.05(f).


                    If
the Specified Account Party fails to make such payment when due, the
Administrative Agent shall notify each Lender of the applicable LC
Disbursement, the payment then due from the Specified Account Party in respect
thereof and such Lender’s Applicable Percentage thereof.


                    (g)
Obligations Absolute. The several obligations of the Specified Account
Party with respect to any Letter of Credit to reimburse LC Disbursements in
respect of any Participated Letter of Credit as provided in paragraph (f)
of this Section 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 Participated Letter of Credit, or any term or
provision therein, (ii) any draft or other document presented under a
Participated 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 by the Issuing Lender under a Participated Letter of Credit
against presentation of a draft or other document that does not comply strictly
with the terms of such Participated Letter of Credit (provided that such
Specified Account Party shall not be obligated to reimburse such LC
Disbursements unless payment is made against presentation of a draft or other
document that at least substantially complies with the terms of such
Participated Letter of Credit), (iv) the occurrence of any Default or (v) any
other event or circumstance whatsoever, whether or not similar to any of the
foregoing, that might, but for the provisions of this Section, constitute a
legal or equitable discharge of the obligations of such Specified Account Party
hereunder.


                    Neither
the Administrative Agent, the Lenders nor the Issuing Lender, nor any of their
respective Related Parties, shall have any liability or responsibility by reason
of or in connection with the payment or failure to make any payment under a
Participated Letter of Credit (irrespective of any of the circumstances
referred to in the preceding sentence) as a result of determining whether
drafts or other documents presented under a Participated Letter of Credit
comply with the terms thereof, or any error, omission, interruption, loss or
delay in transmission or delivery of any draft, notice or other communication
under or relating to any Participated 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 the control of
the Issuing Lender; provided that the foregoing shall not be construed
to excuse the Issuing Lender from liability to the Account Parties 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 the Account Parties that are caused by
the Issuing Lender’s gross negligence or willful misconduct when determining
whether drafts and 


33





other
documents presented under a Participated Letter of Credit comply with the terms
hereof. The parties hereto expressly agree that:


	
  

 	
  

 
	
  

 	
           (i)
 the Issuing Lender may accept documents that appear on their face to be in
 substantial compliance with the terms of a Participated 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 Participated Letter of Credit;

 
	
  

 	
  

 
	
  

 	
           (ii)
 the Issuing Lender 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 Participated Letter of Credit;
 and

 
	
  

 	
  

 
	
  

 	
           (iii)
 this sentence shall establish the standard of care to be exercised by the
 Issuing Lender when determining whether drafts and other documents presented
 under a Participated 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).

 



                    (h)
Disbursement Procedures. The Issuing Lender shall, within a reasonable
time following its receipt thereof, examine all documents purporting to
represent a demand for payment under a Participated Letter of Credit. The
Issuing Lender shall promptly after such examination notify the Administrative
Agent and the Specified Account Party with respect to such Letter of Credit by
telephone (confirmed by telecopy or email) of such demand for payment and
whether the Issuing Lender has made or will make an LC Disbursement thereunder;
provided that any failure to give or delay in giving such notice shall not
relieve the Specified Account Party of its obligation to reimburse the Issuing
Lender and the Lenders with respect to any such LC Disbursement.


                    (i)
Interim Interest. If any LC Disbursement is made with respect to a
Participated Letter of Credit, then, unless such LC Disbursement is reimbursed
in full on the date such LC Disbursement is made, the unpaid amount thereof
shall bear interest, subject to Section 2.15(c), for each day from and
including the date such LC Disbursement is made to but excluding the date that
such LC Disbursement is reimbursed, at the rate per annum equal to 1% plus the
Alternate Base Rate. Interest accrued pursuant to this paragraph shall be for
account of the Issuing Lender, except that interest accrued on and after the
date of payment by any Lender pursuant to paragraph (f) of this Section to
reimburse the Issuing Lender shall be for account of such Lender to the extent
of such payment.


                    (j)
Replacement of the Issuing Lender. The Issuing Lender may be replaced at
any time by written agreement between XL Group, the Administrative Agent, the
replaced Issuing Lender and the successor Issuing Lender. The Administrative
Agent shall notify the Lenders of any such replacement of the Issuing Lender.
At the time any such replacement shall become effective, XL Group shall pay all
unpaid fees accrued for account of the replaced Issuing Lender pursuant to
Section 2.14(c). From and after the effective date of any such
replacement, (i) the successor Issuing Lender shall have all the rights and
obligations of the replaced Issuing Lender under this Agreement with respect to
Participated Letters of Credit to be issued thereafter 


34





and (ii)
references herein to the term “Issuing Lender” shall be deemed to refer to such
successor or to any previous Issuing Lender, or to such successor and all
previous Issuing Lenders, as the context shall require. After the replacement
of an Issuing Lender hereunder, the replaced Issuing Lender shall remain a
party hereto and shall continue to have all the rights and obligations of an
Issuing Lender under this Agreement with respect to Participated Letters of
Credit issued by it prior to such replacement, but shall not be required to
issue additional Participated Letters of Credit.


                    (k)
Adjustment of Applicable Percentages. Notwithstanding anything herein to
the contrary, upon (i) each increase of the Commitments pursuant to Section
2.11(c), each Lender’s participation in each Participated Letter of Credit then
outstanding shall automatically be adjusted to reflect its Applicable
Percentage after giving effect to such increase and (ii) the assignment by
a Lender of all or a portion of its Commitment and its interests in the
Participated Letters of Credit pursuant to an Assignment and Assumption, the
respective assigning Lender’s participation in each Participated Letter of
Credit then outstanding shall automatically be adjusted to reflect, and the
respective assignee Lender shall be deemed to acquire a participation in each
such Participated Letter of Credit in an amount equal to, its Applicable
Percentage after giving effect to such assignment.


                    (l)
Continuation of Existing Participated Letters of Credit. Subject to the
terms and conditions hereof, each Participated Letter of Credit under (and as
defined in) the Existing Unsecured Credit Agreement which is outstanding on the
Effective Date and listed on Schedule VI as a “Participated Letter of Credit”
shall automatically be deemed continued hereunder on the Effective Date by the
Issuing Lender of such Participated Letter of Credit, and as of the Effective
Date the Lenders shall acquire a participation therein as if such Participated
Letter of Credit were issued hereunder, and each such Participated Letter of
Credit shall be deemed a Participated Letter of Credit for all purposes of this
Agreement as of the Effective Date.


                    SECTION
2.06. Alternative Currency Letters of Credit.


                    (a)
Requests for Offers. From time to time during the Availability Period, a
Specified Account Party may request any or all of the Lenders to make offers to
issue an Alternative Currency Letter of Credit for account of such Specified
Account Party. Each Lender may, but shall have no obligation to, make such
offers on terms and conditions that are satisfactory to such Lender, and such
Specified Account Party may, but shall have no obligation to, accept any such
offers. An Alternative Currency Letter of Credit shall be issued, amended,
renewed or extended only if (and upon such issuance, amendment, renewal or
extension of each Alternative Currency Letter of Credit XL Group shall be
deemed to represent and warrant that), after giving effect to such issuance,
amendment, renewal or extension, the Aggregate Credit Exposure shall not exceed the aggregate amount of
the Commitments. Each such Alternative Currency Letter of Credit shall be
issued, and subsequently, renewed, extended, amended and confirmed, on such
terms as XL Group, the Specified Account Party and such Lender shall agree,
including 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 one-year anniversary from the date of
issuance thereof (or, in the case of any renewal or extension thereof, one-year
after such renewal or extension).


35





                    (b)
Reports to Administrative Agent. XL Group shall deliver to the
Administrative Agent and each of the Lenders a report in respect of each
Alternative Currency Letter of Credit (an “Alternative Currency Letter of
Credit Report”) on and as of the date (i) on which such Alternative
Currency Letter of Credit is issued, (ii) of the issuance, renewal,
extension or amendment of a Syndicated Letter of Credit or a Non-Syndicated
Letter of Credit, if any Alternative Currency Letter of Credit is then
outstanding and (iii) on which the Commitments are to be reduced pursuant
to Section 2.11, 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 Alternative Currency LC Exposure (in Dollars) in respect of such
 Alternative Currency Letter of Credit; and

 
	
  

 	
  

 
	
  

 	
           (F)
 the aggregate amount of Alternative Currency LC Exposures (in Dollars).

 



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


                    SECTION
2.07. Loans and Borrowings.


                    (a)
Loans. Subject to the terms and conditions set forth herein, each Lender
agrees to make Loans, in each case, to an Account Party from time to time
during the Availability Period in an aggregate principal amount that will not
result in (i) such Lender’s outstanding Loans exceeding such Lender’s
Applicable Percentage of the Loan Sublimit, (ii) such Lender’s Credit
Exposure (excluding any Alternative Currency LC Exposure) exceeding such
Lender’s respective Commitment, (iii) the Aggregate Credit Exposure exceeding the aggregate Commitments of
all Lenders or (iv) the aggregate outstanding principal amount of the
Loans exceeding the Loan Sublimit. Loans may be made, or be outstanding, to
more than one of the Account Parties at any time. Within the foregoing limits
and subject to the terms and conditions set forth herein, the Account Parties
may borrow, prepay and reborrow Loans.


                    (b)
Obligations of Lenders. Except as provided herein, each Loan shall be
made as part of a Borrowing consisting of one or more Loans of the same Type
made by the Lenders ratably in accordance with their respective Applicable
Percentage of the Loan Sublimit. The failure of any Lender to make any Loan
required to be made by it shall not relieve any other 


36





Lender of its
obligations hereunder; provided that the Commitments of the Lenders to
make Loans hereunder are several and no Lender shall be responsible for any
other Lender’s failure to make Loans as required.


                    (c)
Type of Loans. Subject to Section 2.15, each Borrowing shall be
constituted entirely of ABR Loans or of Eurodollar Loans as any Account
Party may request in accordance herewith. Each Lender at its option may make
any Loan to a foreign jurisdiction by causing any domestic or foreign branch or
Affiliate of such Lender to make such Loan; provided that any exercise
of such option shall not affect the obligation of the Account Parties to repay
such Loan in accordance with the terms of this Agreement.


                    (d)
Minimum Amounts; Limitation on Number of Borrowings. Each Eurodollar
Borrowing shall be in an aggregate amount of $10,000,000 or a larger multiple
of $1,000,000. Each ABR Borrowing shall be in an aggregate amount equal to
$10,000,000 or a larger multiple of $1,000,000; provided that an
ABR Borrowing may be in an aggregate amount that is equal to the entire
unused balance of the Loan Sublimit or that is requested to finance the
reimbursement of an LC Disbursement as contemplated by Sections 2.03(a),
2.04(g) or 2.05(f). Borrowings of more than one Type may be outstanding at the
same time; provided that there shall not at any time be more than a
total of ten Eurodollar Borrowings outstanding.


                    (e)
Limitations on Interest Periods. Notwithstanding any other provision of
this Agreement, no Account Party shall be entitled to request (or to elect to
convert to or continue as a Eurodollar Borrowing) any Borrowing if the Interest
Period requested therefor would end after the Commitment Termination Date.


                    (f)
Pro Rata Borrowings. Loans made as part of a Borrowing shall be made by
the Lenders ratably in accordance with their respective Applicable Percentage
of the Loan Sublimit.


                    SECTION
2.08. Requests for Borrowings.


                    (a)
Notice by the Account Parties. To request a Borrowing, XL Group shall
notify the Administrative Agent of such request by telephone (i) in the
case of a Eurodollar Borrowing, not later than 11:00 a.m., New York City
time, three Business Days before the date of the proposed Borrowing or
(ii) in the case of an ABR Borrowing, not later than 11:00 a.m.,
New York City time, on the date of the proposed Borrowing; provided that
any such notice of an ABR Borrowing to finance the reimbursement of an LC
Disbursement as contemplated by Sections 2.03(a), 2.04(g) or 2.05(f) may be
given not later than 11:00 a.m., New York City time, on the date of the
proposed Borrowing. Each such telephonic Borrowing Request shall be irrevocable
and shall be confirmed promptly by hand delivery or telecopy to the
Administrative Agent of a written Borrowing Request.


                    (b)
Content of Borrowing Requests. Each telephonic and written Borrowing
Request shall specify the following information in compliance with
Section 2.07:


	
  

 	
  

 
	
  

 	
           (i)
 the relevant Account Party;

 
	
  

 	
  

 
	
  

 	
           (ii)
 the aggregate amount of the requested Borrowing;

 


37









	
  

 	
  

 
	
  

 	
           (iii)
 the date of such Borrowing, which shall be a Business Day;

 
	
  

 	
  

 
	
  

 	
           (iv)
 whether such Borrowing is to be an ABR Borrowing or a Eurodollar
 Borrowing;

 
	
  

 	
  

 
	
  

 	
           (v)
 in the case of a Eurodollar Borrowing, the Interest Period therefor, which
 shall be a period contemplated by the definition of the term “Interest
 Period” and permitted under Section 2.07(e); and

 
	
  

 	
  

 
	
  

 	
           (vi)
 the location and number of such Account Party’s account to which funds are to
 be disbursed, which shall comply with the requirements of Section 2.09.

 



                    (c)
Notice by the Administrative Agent to the Lenders. Promptly following
receipt of a Borrowing Request in accordance with this Section, the
Administrative Agent shall advise each relevant Lender of the details thereof
and of the amount of such Lender’s Loan to be made as part of the requested
Borrowing.


                    (d)
Failure to Elect. If no election as to the Type of a Borrowing is
specified, then the requested Borrowing shall be an ABR Borrowing. If no
Interest Period is specified with respect to any requested Eurodollar
Borrowing, then the requested Borrowing shall be made instead as an
ABR Borrowing.


                    SECTION
2.09. Funding of Borrowings.


                    (a)
Funding by Lenders. Each Lender shall make each Loan to be made by it
hereunder on the proposed date thereof by wire transfer of immediately
available funds by 12:00 noon, New York City time (or 1:00 p.m., New York
City time with respect to ABR Loans requested by XL Group no later than 11:00
a.m. on the same day), to the account of the Administrative Agent most recently
designated by it for such purpose by notice to the Lenders. The Administrative
Agent will make such Loans available to the relevant Account Party by promptly
crediting the amounts so received, in like funds, to an account of such Account
Party maintained with the Administrative Agent in New York City and designated
by such Account Party in the applicable Borrowing Request.


                    (b)
Presumption by the Administrative Agent. Unless the Administrative Agent
shall have received notice from a Lender prior to the proposed date of any
Borrowing (or in the case of any ABR Borrowing, on or prior to the proposed
date of such Borrowing) that such Lender will not make available to the
Administrative Agent such Lender’s share of such Borrowing, the Administrative
Agent may assume that such Lender has made such share available on such date in
accordance with paragraph (a) of this Section and may, in reliance upon
such assumption, make available to the relevant Account Party a corresponding
amount. In such event, if a Lender has not in fact made its share of the
applicable Borrowing available to the Administrative Agent, then the applicable
Lender and the relevant Account Party severally agree to pay to the
Administrative Agent forthwith on demand such corresponding amount with
interest thereon, for each day from and including the date such amount is made
available to such Account Party to but excluding the date of payment to the
Administrative Agent, at (i) in the case of such Lender, the Federal Funds
Effective Rate or (ii) in the case of such Account Party, the 


38





interest rate
applicable to ABR Loans. If such Lender pays such amount to the
Administrative Agent, then such amount shall constitute such Lender’s Loan
included in such Borrowing.


                    SECTION
2.10. Interest Elections.


                    (a)
Elections by the Account Parties. The Loans constituting each Borrowing
initially shall be of the Type specified in the applicable Borrowing Request
and, in the case of a Eurodollar Borrowing, shall have the Interest Period
specified in such Borrowing Request. Thereafter, the relevant Account Party may
elect to convert such Borrowing to a Borrowing of a different Type or to
continue such Borrowing as a Borrowing of the same Type and, in the case of a
Eurodollar Borrowing, may elect the Interest Period therefor, all as provided
in this Section. The relevant Account Party may elect different options with
respect to different portions of the affected Borrowing, in which case each
such portion shall be allocated ratably among the Lenders holding the Loans
constituting such Borrowing, and the Loans constituting each such portion shall
be considered a separate Borrowing.


                    (b)
Notice of Elections. To make an election pursuant to this Section, XL
Group shall notify the Administrative Agent of such election by telephone by
the time that a Borrowing Request would be required under Section 2.08 if
XL Group were requesting a Borrowing of the Type resulting from such election
to be made on the effective date of such election. Each such telephonic
Interest Election Request shall be irrevocable and shall be confirmed promptly
by hand delivery or telecopy to the Administrative Agent of a written Interest
Election Request.


                    (c)
Content of Interest Election Requests. Each telephonic and written
Interest Election Request shall specify the following information in compliance
with Section 2.07:


	
  

 	
  

 
	
  

 	
           (i)
 the Borrowing to which such Interest Election Request applies and, if
 different options are being elected with respect to different portions
 thereof, the portions thereof to be allocated to each resulting Borrowing (in
 which case the information to be specified pursuant to clauses (iii)
 and (iv) of this paragraph shall be specified for each resulting
 Borrowing);

 
	
  

 	
  

 
	
  

 	
           (ii)
 the effective date of the election made pursuant to such Interest Election
 Request, which shall be a Business Day;

 
	
  

 	
  

 
	
  

 	
           (iii)
 whether the resulting Borrowing is to be an ABR Borrowing or a
 Eurodollar Borrowing; and

 
	
  

 	
  

 
	
  

 	
           (iv)
 if the resulting Borrowing is a Eurodollar Borrowing, the Interest Period
 therefor after giving effect to such election, which shall be a period
 contemplated by the definition of the term “Interest Period” and permitted
 under Section 2.07(e).

 



                    (d)
Notice by the Administrative Agent to the Lenders. Promptly following
receipt of an Interest Election Request, the Administrative Agent shall advise
each Lender of the details thereof and of such Lender’s portion of each
resulting Borrowing.


                    (e)
Failure to Elect; Events of Default. If XL Group fails to deliver a
timely and complete Interest Election Request with respect to a Eurodollar
Borrowing prior to the end of the 


39





Interest
Period therefor, then, unless such Borrowing is repaid as provided herein, at
the end of such Interest Period such Borrowing shall be converted to an
ABR Borrowing. Notwithstanding any contrary provision hereof, if an Event
of Default has occurred and is continuing and the Administrative Agent, at the
request of the Required Lenders, so notifies XL Group, then, so long as an
Event of Default is continuing (i) no outstanding Borrowing may be
converted to or continued as a Eurodollar Borrowing and (ii) unless repaid,
each Eurodollar Borrowing shall be converted to an ABR Borrowing at the
end of the Interest Period therefor.


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


                    (a)
Scheduled Termination. Unless previously terminated, the Commitments
shall terminate at the close of business on the Commitment Termination Date.


                    (b)
Voluntary Termination or Reduction. The Account Parties may at any time
terminate, or from time to time reduce, the Commitments and/or may reduce at
any time the Loan Sublimit; provided that (i) each reduction of the
Commitments or the Loan Sublimit shall be in an amount that is $25,000,000 or a
larger multiple of $5,000,000, (ii) the Account Parties shall not
terminate or reduce the Commitments if the Aggregate Credit Exposure would exceed the Commitments, and (iii)
the Account Parties shall not reduce the Loan Sublimit if the outstanding Loans
would exceed the Loan Sublimit. XL Group shall notify the Administrative Agent
of any election to terminate or reduce the Commitments or the Loan Sublimit
under this paragraph (b) at least three Business Days prior to the
effective date of such termination or reduction, specifying such election and
the effective date thereof, provided that no reduction of the Loan
Sublimit shall occur in connection with a reduction of the Commitments unless
specified in such notice, except that upon the earlier of (x) the termination
of the Commitments and (y) the Commitment Termination Date, the Loan Sublimit
shall automatically be reduced to zero. Promptly following receipt of any such
notice, the Administrative Agent shall advise the Lenders of the contents
thereof. Each notice delivered by XL Group pursuant to this paragraph (b)
shall be irrevocable; provided that a notice of termination of the
Commitments delivered by XL Group may state that such notice is conditioned
upon the effectiveness of other credit facilities, in which case such notice
may be revoked by XL Group (by notice to the Administrative Agent on or prior
to the specified effective date) if such condition is not satisfied. Subject to
the proviso in the immediately preceding sentence, any termination or reduction
of the Commitments or the Loan Sublimit shall be permanent. Each reduction of
the Commitments shall be made ratably among the Lenders in accordance with
their respective Commitments.


                    (c)
Increases to Commitments. XL Group shall have the right, at any time by
notice to the Administrative Agent, to increase the Commitments hereunder (i)
by including as a Lender hereunder with a new Commitment, any Person which is a
NAIC Approved Bank (or any other Person whose obligations in respect of Letters
of Credit issued under the Agreement shall be confirmed by a NAIC Approved
Bank) that is not an existing Lender or (ii) by having an existing Lender
increase its Commitment then in effect (with the consent of such Lender in its
sole discretion) (each new or increasing Lender, a “Supplemental Lender”)
in each case with the approval (not to be unreasonably withheld) of the
Administrative Agent, which notice shall specify the name of each Supplemental
Lender, the aggregate amount of such increase and the portion thereof being
assumed by each such Supplemental Lender, and the date on which such 


40





increase is to
become effective (each a “Supplemental Commitment Date”) (which shall be
a Business Day at least three Business Days after the delivery of such notice
and 30 days prior to the Commitment Termination Date); provided that
(w) the aggregate amount of increases of the Commitments under this
paragraph and pursuant to Section 2.07(c) (or any successor provision) of the
Secured Credit Agreement shall not exceed $500,000,000, (x) no existing Lender
shall have any obligation to participate in such increase of aggregate
Commitments, (y) the Commitment of any Supplemental Lender that is not an
existing Lender shall be in an amount of at least $25,000,000 and (z) the
aggregate amount of the increase of the Commitments effected on any day shall
be in an aggregate amount of at least $25,000,000 and larger multiples of
$1,000,000. Each such Supplemental Lender shall enter into an agreement in form
and substance satisfactory to XL Group and the Administrative Agent pursuant to
which such Supplemental Lender shall, as of the applicable Supplemental
Commitment Date, undertake a Commitment (or, if any such Supplemental Lender is
an existing Lender, pursuant to which such Supplemental Lender’s Commitment
shall be increased in the agreed amount on such date) and such Supplemental
Lender shall thereupon become (or, if it is already a Lender, continue to be) a
“Lender” for all purposes hereof; provided that, in the case of any
Supplemental Lender that is not a Lender immediately prior to such Supplemental
Commitment Date and is not listed on the NAIC Approved Bank List, such
Supplemental Lender and its Confirming Lender shall have entered into an
agreement of the type contemplated in the definition of “Confirming Lender” in
Section 1.01.


                    Notwithstanding
the foregoing, no increase in the Commitments hereunder pursuant to this
Section shall be effective unless on the applicable Supplemental Commitment
Date:


	
  

 	
  

 
	
  

 	
           (i)
 no Default shall have occurred and be continuing; and

 
	
  

 	
  

 
	
  

 	
           (ii)
 the representations and warranties of the Obligors set forth in this
 Agreement (other than in Section 4.04(b)) shall be true and correct in all
 material respects 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) except where such representations and warranties are
 conditioned by materiality and then such representations and warranties shall
 be true and correct in all respects.

 



Each
such notice shall be deemed to constitute a representation and warranty by XL
Group as to the matters specified in clauses (i) and (ii) of the immediately
preceding sentence as of such date.


                    SECTION
2.12. Repayment of Loans; Evidence of Debt.


                    (a)
Repayment. Each Account Party hereby unconditionally promises to pay to
the Administrative Agent for account of the relevant Lenders the outstanding
principal amount of the Loans made to such Account Party on the Commitment
Termination Date.


                    (b)
Maintenance of Records by Lenders. Each Lender shall maintain in
accordance with its usual practice records evidencing the indebtedness of each
Account Party to such Lender resulting from each Loan made by such Lender to
such Account Party, including the amounts of principal and interest payable and
paid to such Lender from time to time hereunder.


41





                    (c)
Maintenance of Records by the Administrative Agent. The Administrative
Agent shall maintain records in which it shall record (i) the amount of
each Loan made to each Account Party hereunder, the Type thereof and each
Interest Period therefor, (ii) the amount of any principal or interest due
and payable or to become due and payable from such Account Party to each Lender
hereunder and (iii) the amount of any sum received by the Administrative
Agent hereunder for account of the Lenders and each Lender’s share thereof.


                    (d)
Effect of Entries. The entries made in the records maintained pursuant
to paragraph (b) or (c) of this Section shall be prima facie evidence
of the existence and amounts of the obligations recorded therein; provided that
the failure of any Lender or the Administrative Agent to maintain such records
or any error therein shall not in any manner affect the obligation of the
Account Parties to repay the Loans in accordance with the terms of this
Agreement.


                    (e)
Promissory Notes. Any Lender may request that Loans made by it to any
Account Party be evidenced by a promissory note of such Account Party. In such
event, each Account Party shall prepare, execute and deliver to such Lender a
promissory note payable to such Lender (or, if requested by such Lender, to
such Lender and its registered assigns) and in a form approved by the
Administrative Agent.


                    SECTION
2.13. Prepayment of Loans.


                    (a)
Right to Prepay Borrowings. The Account Parties shall have the right at
any time and from time to time to prepay any Borrowing in whole or in part,
without premium or penalty, subject to the requirements of this Section.


                    (b)
Notices, Etc. XL Group shall notify the Administrative Agent by
telephone (confirmed by telecopy) of any prepayment hereunder (i) in the
case of prepayment of a Eurodollar Borrowing, not later than 11:00 a.m.,
New York City time, three Business Days before the date of prepayment or
(ii) in the case of prepayment of an ABR Borrowing, not later than
11:00 a.m., New York City time, one Business Day before the date of
prepayment; provided that each repayment of Borrowings shall be applied
to repay any outstanding ABR Borrowings before any other Borrowings; provided
further that no such notice shall be required for a repayment on the
Commitment Termination Date. If XL Group fails to make a timely selection of
the Borrowing or Borrowings to be repaid or prepaid, such payment shall be
applied, first, to pay any outstanding ABR Borrowings and, second, to
other Borrowings in the order of the remaining duration of their respective
Interest Periods (the Borrowing with the shortest remaining Interest Period to
be repaid first). Each payment of a Borrowing shall be applied ratably to the
Loans included in such Borrowing.


                    Each
such notice shall be irrevocable and shall specify the prepayment date and the
principal amount of each Borrowing or portion thereof to be prepaid; provided
that, if a notice of prepayment is given in connection with a conditional
notice of termination of the Commitments as contemplated by Section 2.11,
then such notice of prepayment may be revoked if such notice of termination is
revoked in accordance with Section 2.11. Promptly following receipt of any
such notice relating to a Borrowing, the Administrative Agent shall advise the
relevant Lenders of the contents thereof. Each partial prepayment of any
Borrowing shall be in an amount that would be permitted in the case of a
Borrowing of the same Type as provided in 


42





Section 2.07.
Each prepayment of a Borrowing shall be applied ratably to the Loans included
in the prepaid Borrowing. Prepayments shall be accompanied by accrued interest
to the extent required by Section 2.15.


                    SECTION
2.14. Fees.


                    (a)
Commitment Fee. XL Group agrees to pay to the Administrative Agent for
account of each Lender a commitment fee which shall accrue at a rate per annum
as set forth on the Pricing Grid on the average daily unused amount of such Lender’s
Commitment during the period from and including the Effective Date to but
excluding the date of termination of the Commitments. Commitment fees accrued
through and including each Quarterly Date shall be payable on the third
Business Day following such Quarterly Date, commencing on the first such date
to occur after the Effective Date; provided that all such accrued and
unpaid fees shall be payable on the date on which the Commitments terminate.


                    (b)
Commission. XL Group agrees to pay to the Administrative Agent for
account of each Lender a commission which shall accrue at a rate per annum as
set forth on the Pricing Grid on the face amount of each outstanding Letter of
Credit and such commission shall be shared ratably among the Lenders
participating in such Letter of Credit. Commissions accrued through and
including each Quarterly Date shall be payable on the third Business Day
following such Quarterly Date, commencing on the first such date to occur after
the Effective Date; provided that all such fees shall be payable on the date on
which the Commitments terminate and any such accrued and unpaid fees accruing
after the date on which the Commitments terminate shall be payable on demand.


                    (c)
Participated Letter of Credit Fees. XL Group agrees to pay to the
Issuing Lender of any outstanding Participated Letter of Credit a fronting fee
which shall accrue at a rate per annum as agreed in writing between XL Group
and the Issuing Lender on the face amount in respect of such Participated
Letter of Credit (excluding any portion thereof attributable to unreimbursed LC
Disbursements). Fronting fees accrued through and including each Quarterly Date
shall be payable on the third Business Day following such Quarterly Date, commencing
on the first such date to occur after the Effective Date; provided that
all such fees shall be payable on the date on which the Commitments terminate
and any such accrued and unpaid fees accruing after the date on which the
Commitments terminate shall be payable on demand.


                    (d)
LC Administrative Fees. XL Group agrees to pay to the Administrative
Agent and the Issuing Lender (to extent that such Issuing Lender is not the
same Person as the Administrative Agent), each for its own account, within 10
Business Days after demand, the Administrative Agent’s or the Issuing Lender’s
standard administrative fees with respect to the issuance, amendment, renewal
or extension of any Letter of Credit or processing of drawings thereunder.


                    (e)
Administrative Agent Fees. XL Group agrees to pay to the Administrative
Agent, for its own account, fees payable in the amounts and at the times
separately agreed upon between XL Group and the Administrative Agent.


43





                    (f)
Payment and Computation of Fees. 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 the fees referred to in paragraphs (a)
through (c) of this Section, to the Lenders entitled thereto. Fees paid shall
not be refundable under any circumstances. All fees payable under paragraphs
(a) through (c) of this Section shall be computed on the basis of a year of 360
days and shall be payable for the actual number of days elapsed.


                    SECTION
2.15. Interest.


                    (a)
ABR Loans. The Loans constituting each ABR Borrowing shall
bear interest at a rate per annum equal to the Alternate Base Rate plus
the Applicable Margin, if any.


                    (b)
Eurodollar Loans. The Loans constituting each Eurodollar Borrowing shall
bear interest at a rate per annum equal to the Adjusted LIBO Rate for the
Interest Period for such Borrowing plus the Applicable Margin.


                    (c)
Default Interest. If any principal of any Loan or if any amount of
reimbursement obligation, interest, fees and other amounts payable by the
Account Parties hereunder is not paid when due, whether at stated maturity,
upon acceleration or otherwise, such overdue amount shall bear interest, after
as well as before judgment, at a rate per annum equal to (i) in the case
of overdue principal of any Loan, 2% plus the rate otherwise applicable
to such Loan as provided above or (ii) in the case of any other amount, 2%
plus the rate applicable to ABR Loans as provided in
paragraph (a) of this Section.


                    (d)
Payment of Interest. Accrued interest on each Loan shall be payable by
the applicable Account Party in arrears on each Interest Payment Date for such
Loan and upon the date the Commitments terminate; provided that
(x) interest accrued pursuant to paragraph (c) of this Section shall
be payable on demand, (y) in the event of any repayment or prepayment of
any Loan (other than a prepayment of an ABR Loan prior to the Commitment
Termination Date), accrued interest on the principal amount repaid or prepaid
shall be payable on the date of such repayment or prepayment and (z) in
the event of any conversion of any Eurodollar Borrowing prior to the end of the
Interest Period therefor, accrued interest on such Borrowing shall be payable
on the effective date of such conversion.


                    (e)
Computation. All interest hereunder shall be computed on the basis of a
year of 360 days, except that interest computed by reference to the Alternate
Base Rate at times when the Alternate Base Rate is based on the Prime Rate
shall be computed on the basis of a year of 365 days (or 366 days in a leap
year), and in each case shall be payable for the actual number of days elapsed
in the relevant period (including the first day but excluding the last day).
The applicable Alternate Base Rate or Adjusted LIBO Rate shall be determined by
the Administrative Agent and notified to XL Group, and such determination shall
be conclusive absent manifest error.


                    SECTION
2.16. Alternate Rate of Interest. If prior to the commencement of the
Interest Period for any Eurodollar Borrowing:


44









	
  

 	
  

 
	
  

 	
           (a)
 the Administrative Agent determines in good faith (which determination shall
 be conclusive absent manifest error) that adequate and reasonable means do
 not exist for ascertaining the Adjusted LIBO Rate for such Interest Period;
 or

 
	
  

 	
  

 
	
  

 	
           (b)
 the Administrative Agent is advised by the Required Lenders (acting in good
 faith) that the Adjusted LIBO Rate for such Interest Period will not
 adequately and fairly reflect the cost to such Lenders of making or
 maintaining their respective Loans included in such Borrowing for such
 Interest Period;

 



                    then
the Administrative Agent shall give notice thereof to XL Group and the Lenders
by telephone or telecopy as promptly as practicable thereafter and, until the
Administrative Agent notifies XL Group and the Lenders that the circumstances
giving rise to such notice no longer exist, (i) any Interest Election
Request that requests the conversion of any Borrowing to, or the continuation
of any Borrowing as, a Eurodollar Borrowing shall be ineffective and such
Borrowing (unless prepaid) shall be continued as, or converted to, an
ABR Borrowing and (ii) if any Borrowing Request requests a Eurodollar
Borrowing, such Borrowing shall be made as an ABR Borrowing.


                    SECTION
2.17. Increased Costs.


                    (a)
Increased Costs Generally. If any Change in Law shall:


	
  

 	
  

 
	
  

 	
                     (i)
 impose, modify or deem applicable any reserve, special deposit or similar
 requirement against assets of, deposits with or for the account of, or credit
 extended by, any Lender (except any such reserve requirement reflected in the
 Adjusted LIBO Rate); 

 
	
  

 	
  

 
	
  

 	
                     (ii)
 impose on any Lender or the London interbank market any other condition
 affecting this Agreement, any Letter of Credit (or any participation therein)
 or any Eurodollar Loan made by such Lender; or

 
	
  

 	
  

 
	
  

 	
                     (iii)
 change the basis of taxation of payments to any Lender in respect thereof
 (except for Indemnified Taxes, Excluded Taxes and changes in the rate of tax
 on the overall net income of such Lender);

 



                    and
the result of any of the foregoing shall be to increase the cost to such Lender
of making or maintaining, or participating in, any Letter of Credit (or of
maintaining any participation therein) or Eurodollar Loan (or of maintaining
its obligation to make any such Loan) or to reduce the amount of any sum
received or receivable by such Lender hereunder (whether of principal, interest
or otherwise), then XL Group (and in the case of any specific Letter of Credit,
the Specified Account Party on behalf of which such Letter of Credit was
issued) agrees that it will pay to such Lender such additional amount or
amounts as will compensate such Lender for such additional costs incurred or
reduction suffered. Notwithstanding anything herein to the contrary, (i) all
requests, rules, guidelines, requirements and directives promulgated by the
Bank for International Settlements, the Basel Committee on Banking Supervision
(or any successor or similar authority) or by United States or foreign
regulatory authorities, in each case pursuant to Basel III, and (ii) the
Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests,
rules, guidelines, requirements and


45





directives
thereunder or issued in connection therewith or in implementation thereof,
shall in each case be deemed to be a Change in Law, regardless of the date
enacted, adopted or issued.


                    (b)
Capital Requirements. If any Lender determines that any Change in Law
regarding capital requirements has or would have the effect of reducing the
rate of return on such Lender’s capital or on the capital of such Lender’s
holding company, if any, as a consequence of this Agreement or the Letters of
Credit issued or participated in, or the Loans made, by such Lender to a level
below that which such Lender or such Lender’s holding company could have
achieved but for such Change in Law (taking into consideration such Lender’s
policies and the policies of such Lender’s holding company with respect to
capital adequacy or liquidity), then from time to time XL Group (and in the
case of any specific Letter of Credit, the Specified Account Party on behalf of
which such Letter of Credit was issued) will pay to such Lender such additional
amount or amounts as will compensate such Lender or such Lender’s holding
company for any such reduction suffered.


                    (c)
Certificates from Lenders. A certificate of a Lender setting forth such
Lender’s good faith determination of the amount or amounts necessary to
compensate such Lender or its holding company, as the case may be, as specified
in paragraph (a) or (b) of this Section shall be delivered to XL
Group and shall be conclusive and binding upon all parties hereto absent
manifest error. XL Group (and in the case of any specific Letter of Credit, the
Specified Account Party on behalf of which such Letter of Credit was issued)
shall pay such Lender the amount shown as due on any such certificate within 10
days after receipt thereof by XL Group.


                    (d)
Delay in Requests. Failure or delay on the part of any Lender to demand
compensation pursuant to this Section shall not constitute a waiver of such
Lender’s right to demand such compensation; provided that XL Group and
any Specified Account Party shall not be required to compensate a Lender
pursuant to this Section for any increased costs or reductions incurred more
than 90 days prior to the date that such Lender notifies XL Group of the Change
in Law giving rise to such increased costs or reductions and of such Lender’s
intention to claim compensation therefor; provided further that,
if the Change in Law giving rise to such increased costs or reductions is
retroactive, then the 90 day period referred to above shall be extended to
include the period of retroactive effect thereof.


                    (e)
Comparable Treatment. Notwithstanding any other provision of this
Section, no Lender shall demand compensation for any increased cost or
reduction pursuant to this Section if such Lender is not demanding such
compensation in similar circumstances under comparable provisions of other
credit agreements.


                    SECTION
2.18. Break Funding Payments.


                    In
the event of (a) the payment of any principal of any Eurodollar Loan other
than on the last day of an Interest Period therefor (including as a result of
an Event of Default), (b) the conversion of any Eurodollar Loan other than
on the last day of an Interest Period therefor, (c) the failure to borrow,
convert, continue or prepay any Loan on the date specified in any notice
delivered pursuant hereto (regardless of whether such notice is permitted to be
revocable under Section 2.13(b) and is revoked in accordance herewith), or
(d) the assignment as a result of 


46





a request by
XL Group pursuant to Section 2.21(b) of any Eurodollar Loan other than on
the last day of an Interest Period therefor, then, in any such event, the
Account Parties shall compensate each Lender for the loss attributable to such
event. The loss to any Lender attributable to any such event shall be deemed to
be an amount determined by such Lender to be equal to the excess, if any, of
(i) the amount of interest that such Lender would pay for a deposit equal
to the principal amount of such Loan for the period from the date of such
payment, conversion, failure or assignment to the last day of the then current
Interest Period for such Loan (or, in the case of a failure to borrow, convert
or continue, the duration of the Interest Period that would have resulted from
such borrowing, conversion or continuation) if the interest rate payable on
such deposit were equal to the Adjusted LIBO Rate for such Interest Period,
over (ii) the amount of interest that such Lender would earn on such
principal amount for such period if such Lender were to invest such principal
amount for such period at the interest rate that would be bid by such Lender
(or an affiliate of such Lender) for Dollar deposits from other banks in the
eurodollar market at the commencement of such period. A certificate of any
Lender setting forth such Lender’s good faith determination of any amount or
amounts that such Lender is entitled to receive pursuant to this Section shall
be delivered to XL Group and shall be conclusive absent manifest error. The
Account Parties shall pay such Lender the amount shown as due on any such
certificate within 10 days after receipt thereof by XL Group.


                    SECTION
2.19. Taxes.


                    (a)
Payments Free of Taxes. Any and all payments by or on account of any
Obligor hereunder, or under any Credit Document, shall be made free and clear
of and without deduction for or withholding of any amounts in respect of Taxes,
unless such withholding is required by applicable law as determined in good
faith by the applicable Withholding Agent; provided that if any
Indemnified Taxes are required to be withheld from any amounts payable to the
Administrative Agent or any Lender, then (i) the sum payable by the
applicable Obligor shall be increased as necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section) the Administrative Agent or Lender (as the case may be)
receives an amount equal to the sum it would have received had no such amounts
been withheld and (ii) such amounts shall be withheld and paid to the
relevant Governmental Authority in accordance with applicable law.


                    (b)
Payment of Other Taxes by the Account Parties. In addition, each
Specified Account Party shall pay any Other Taxes to the relevant Governmental
Authority in accordance with applicable law.


                    (c)
Indemnification by the Account Parties. XL Group (and in the case of any
specific Letter of Credit, the Specified Account Party on behalf of which such
Letter of Credit was issued) shall indemnify the Administrative Agent and each
Lender, within 10 days after written demand to XL Group therefor, for the full
amount of any Indemnified Taxes and Other Taxes (including Indemnified Taxes
imposed or asserted on or attributable to amounts payable under this Section)
paid by the Administrative Agent or such Lender, as the case may be, and any
penalties, interest and reasonable expenses arising therefrom or with respect
thereto, whether or not such Indemnified Taxes or Other Taxes, as the case may
be, were correctly or legally imposed or asserted by the relevant Governmental
Authority. A certificate setting forth the Administrative Agent’s or such
Lender’s, as the case may be, good faith determination of the 


47





amount of such
payment or liability (along with a reasonably detailed explanation and
computation of such payment or liability) delivered to XL Group by a Lender, or
by the Administrative Agent on its own behalf or on behalf of a Lender, shall
be conclusive as between such Lender or the Administrative Agent, as the case
may be, and the Account Parties absent manifest error.


                    (d)
Each Lender shall indemnify the Administrative Agent for the full amount of any
Taxes imposed by any Governmental Authority that are attributable to such
Lender and that are payable or paid by the Administrative Agent, together with
all interest, penalties, reasonable costs and expenses arising therefrom or
with respect thereto, as determined by the Administrative Agent in good faith.
A certificate as to the amount of such payment or liability delivered to any
Lender by the Administrative Agent shall be conclusive absent manifest error.


                    (e)
Evidence of Payments. As soon as practicable after any payment of
Indemnified Taxes or Other Taxes by any Specified Account Party to a
Governmental Authority, XL Group on behalf of such Specified Account Party
shall deliver to the Administrative Agent the original or a certified copy of a
receipt issued by such Governmental Authority evidencing such payment, a copy
of the return reporting such payment or other evidence of such payment
reasonably satisfactory to the Administrative Agent.


                    (f)
Exemptions. (1) Each recipient of payments under this Agreement or any
Credit Document (or a Transferee, including any Participant, in which case such
Participant’s obligations to a Specified Account Party and the Administrative
Agent described in this Section 2.19(f) shall also extend to the Lender from
which the related participation shall have been purchased) (i) that is a
“United States Person” as defined in Section 7701(a)(30) of the Code (a “U.S.
Lender”) shall deliver to the Specified Account Party and the Administrative
Agent two properly completed and duly signed copies of U.S. Internal Revenue
Service (“IRS”) Form W-9 (or any successor form) certifying that such U.S.
Lender is exempt from U.S. federal withholding tax or (ii) that is not a
“United States Person” as defined in Section 7701(a)(30) of the Code (a “Non-U.S.
Lender”) shall deliver to the Specified Account Party and the
Administrative Agent (I) two copies of IRS Form W-8BEN, Form W-8ECI or
Form W-8IMY(or any successor form) (together with any applicable underlying IRS
forms), (II) in the case of a Non-U.S. Lender claiming exemption from U.S.
federal withholding tax under Section 871(h) or 881(c) of the Code with respect
to payments of “portfolio interest”, a certification to the effect that such
Non-U.S. Lender is not (a) a “bank” within the meaning of Section 881(c)(3)(A)
of the Code, (b) a “10 percent shareholder” of the Specified Account party
within the meaning of Section 881(c)(3)(B) of the Code, (c) a “controlled
foreign corporation” described in Section 881(c)(3)(C) of the Code or (d)
conducting a trade or business in the United States with which the relevant
interest payments are effectively connected; and the applicable IRS Form W-8
(or any successor form) properly completed and duly executed by such Non-U.S.
Lender claiming complete exemption from U.S. federal withholding tax on
payments under this Agreement and the other Credit Documents, or (III) any
other form prescribed by applicable requirements of U.S. federal income tax law
as a basis for claiming exemption from or a reduction in U.S. federal
withholding tax duly completed together with such supplementary documentation
as may be prescribed by applicable requirements of law to permit the Specified
Account Party and the Administrative Agent to determine the withholding or
deduction required to be made. Such forms shall be delivered by each U.S.
Lender and each Non-U.S. Lender on or before the date it 


48





becomes a
party to this Agreement (or, in the case of any Participant, on or before the
date such Participant purchases the related participation) and from time to
time thereafter upon the request of the Specified Account Party or the
Administrative Agent. In addition, each U.S. Lender and each Non-U.S. Lender
shall deliver such forms promptly upon the obsolescence or invalidity of any
form previously delivered by it. Each U.S. Lender and each Non-U.S. Lender
shall promptly notify the Specified Account Party and the Administrative Agent
at any time it determines that it is no longer in a position to provide any
previously delivered certificate to the Specified Account Party (or any other
form of certification adopted by the U.S. taxing authorities for such purpose).
Notwithstanding any other provision of this Section, no U.S. Lender or Non-U.S.
Lender shall be required to deliver any form pursuant to this Section that such
Non-U.S. Lender is not legally able to deliver.


                    (2)
If a payment made to any recipient under any Credit Document would be subject
to U.S. federal withholding Tax imposed by FATCA if such recipient were to fail
to comply with the applicable reporting requirements of FATCA (including those
contained in Section 1471(b) or 1472(b) of the Code, as applicable), such
recipient shall deliver to each Account Party and the Administrative Agent at
the time or times prescribed by law and at such time or times reasonably
requested by any Account Party or the Administrative Agent such documentation
prescribed by applicable law (including as prescribed by Section
1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably
requested by any Account Party or the Administrative Agent as may be necessary
for the Account Parties and the Administrative Agent to comply with their
obligations under FATCA and to determine whether such recipient has complied
with such recipient’s obligations under FATCA or to determine the amount to
deduct and withhold from such payment. Solely for purposes of this Section
2.19(f)(2), “FATCA” shall include any amendments made to FATCA after the date
of this Agreement. Each recipient agrees that if any form or certification it
previously delivered under this clause expires or becomes obsolete or
inaccurate in any respect, it shall update such form or certification or
promptly notify the Account Parties and the Administrative Agent in writing of
its legal inability to do so.


                    (3)
Each U.S. Lender and each Non-U.S Lender that is entitled to an exemption from
or reduction of non-U.S. withholding tax under the law of the jurisdiction in
which the Specified Account Party is located, or any treaty to which such
jurisdiction is a party, with respect to payments under this Agreement shall
deliver to the Specified Account Party (with a copy to the Administrative
Agent), at the time or times prescribed by applicable law or reasonably
requested by the Specified Account Party or the Administrative Agent, such
properly completed and executed documentation prescribed by applicable law as
will permit such payments to be made without withholding or at a reduced rate; provided
that such U.S. Lender or Non-U.S. Lender is legally entitled to complete,
execute and deliver such documentation and in its reasonable judgment such
completion, execution or submission would not materially prejudice its legal or
commercial position.


                    (g)
If the Administrative Agent or a Lender determines, in its reasonable
discretion, that it has received a refund from the relevant Governmental
Authority of any Taxes or Other Taxes as to which it has been indemnified by an
Account Party or with respect to which an Account Party has paid additional
amounts pursuant to this Section, it shall pay over such refund to such Account
Party (but only to the extent of indemnity payments made, or additional 


49





amounts paid,
by such Account Party under this Section with respect to the Taxes or Other
Taxes giving rise to such refund), net of all out-of-pocket expenses of the
Administrative Agent or such Lender and without interest (other than any
interest paid by the relevant Governmental Authority with respect to such
refund); provided that such Account Party, upon the request of the
Administrative Agent or such Lender, agrees to repay the amount paid over to
such Account Party (plus any penalties, interest or other charges imposed by
the relevant Governmental Authority) to the Administrative Agent or such Lender
in the event the Administrative Agent or such Lender is required to repay such
refund to such Governmental Authority. This Section shall not be construed to
require the Administrative Agent or any Lender to make available its tax
returns (or any other information relating to its taxes not expressly required
to be made available hereunder which it reasonably deems confidential) to any
Account Party or any other Person.


                    SECTION
2.20. Payments Generally; Pro Rata Treatment; Sharing of Set-offs.


                    (a)
Payments by the Account Parties. Each Account Party shall make each
payment required to be made by it hereunder (whether of principal, interest,
fees or reimbursement of LC Disbursements or interest thereon, under
Section 2.17, 2.18 or 2.19, or otherwise) or under any other Credit
Document (except to the extent otherwise provided therein) prior to
12:00 noon, New York City time, on the date when due, in immediately
available funds, without set-off or counterclaim; provided that any
payments in respect of Alternative Currency Letters of Credit shall be made in
the manner (including the time and place of payment) as shall have been
separately agreed between the relevant Account Party and Lender pursuant to
Section 2.06. 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 offices at 1111
Fannin Street, Houston, Texas except payments pursuant to Sections 2.17,
2.18, 2.19 and 10.03, which 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 shall be made in Dollars.


                    (b)
Application of Insufficient Payments. If at any time insufficient funds
are received by and available to the Administrative Agent to pay fully all
amounts of principal, unreimbursed LC Disbursements, 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 principal and unreimbursed LC Disbursements then due
hereunder, ratably among the parties entitled thereto in accordance with the
amounts of principal and unreimbursed LC Disbursements then due to such
parties.


                    (c)
Pro Rata Treatment. Except to the extent otherwise provided herein: (i)
each reimbursement of LC Disbursements (other than in respect of Alternative
Currency Letters of Credit) shall be made to the relevant Lenders, each
Borrowing shall be made from the Lenders, each payment of fees under
Section 2.14 shall be made for account of the relevant Lenders, each


50






termination or reduction of the amount of the
Commitments under Section 2.11 and any interest paid in respect of any
Reimbursement Obligation shall be applied to the respective Commitments (or,
in the case of any Borrowing, the respective commitment to make Loans hereunder)
of the Lenders, in each case pro rata according to the amounts of their
respective Commitments (or, in the case of any Borrowing, the respective
commitment to make Loans hereunder or, in the case of any such reimbursement
or payment after the termination of the Commitments, pro rata according to the
Aggregate Credit Exposure);
(ii) each Borrowing shall be allocated pro rata among the Lenders
according to the amounts of their respective Commitments (in the case of the
making of Loans) or their respective Loans that are to be included in such
Borrowing (in the case of conversions and continuations of Loans);
(iii) each payment or prepayment of principal of Loans by any Account
Party shall be made for account of the Lenders pro rata according to the
respective unpaid principal amounts of the Loans of such Account Party being
paid or prepaid that are owed to such Lenders and (iv) each payment of
interest on Loans by an Account Party shall be made for account of the Lenders
pro rata according to the amounts of interest on such Loans then due and
payable thereunder. 


                    (d)
Sharing of Payments by Lenders. If any Lender shall, by exercising any
right of set-off or counterclaim or otherwise, obtain payment in respect of any
principal of or interest on any of its Loans or LC Disbursements (other than
with respect to Alternative Currency Letters of Credit) or accrued interest
thereon resulting in such Lender receiving payment of a greater proportion of
the aggregate amount of its Loans and/or LC Disbursements (other than with
respect to Alternative Currency Letters of Credit) and accrued interest thereon
then due than the proportion received by any other relevant Lender, then the
Lender receiving such greater proportion shall purchase (for cash at face
value) participations in the Loans and/or LC Disbursements (other than with
respect to Alternative Currency Letters of Credit) of such other Lenders to the
extent necessary so that the benefit of all such payments shall be shared by
the Lenders ratably in accordance with the aggregate amount of principal of and
accrued interest on their respective Loans and/or LC Disbursements (other than
with respect to Alternative Currency Letters of Credit) and accrued interest
thereon; provided that (i) if any such participations are purchased
and all or any portion of the payment giving rise thereto is recovered, such
participations shall be rescinded and the purchase price restored to the extent
of such recovery, without interest, and (ii) the provisions of this paragraph
shall not be construed to apply to any payment made by any Account Party
pursuant to and in accordance with the express terms of this Agreement or any
payment obtained by a Lender as consideration for the assignment of or sale of
a participation in any of its Loans or LC Disbursements to any assignee or
participant, other than to any Account Party or any Subsidiary or Affiliate
thereof (as to which the provisions of this paragraph shall apply). Each
Account Party consents to the foregoing and agrees, to the extent it may
effectively do so under applicable law and to the extent that it is a Specified
Account Party, that any Lender acquiring a participation pursuant to the
foregoing arrangements may exercise against such Account Party rights of
set-off and counterclaim with respect to such participation as fully as if such
Lender were a direct creditor of such Account Party in the amount of such
participation.


                    (e)
Presumptions of Payment. Unless the Administrative Agent shall have
received notice from an Account Party prior to the date on which any payment is
due to the Administrative Agent for account of the relevant Lenders hereunder
that such Account Party will


51





not make such payment, the Administrative Agent may
assume that such Account Party has made such payment on such date in accordance
herewith and may, in reliance upon such assumption, distribute to the relevant
Lenders the amount due. In such event, if the relevant Account Party has not in
fact made such payment, then each of the Lenders severally agrees to repay to
the Administrative Agent forthwith on demand the amount so distributed to such
Lender 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 Effective Rate.


                    (f)
Certain Deductions by the Administrative Agent. If any Lender shall fail
to make any payment required to be made by it pursuant to this Agreement, then
the Administrative Agent may, in its discretion (notwithstanding any contrary
provision hereof), apply any amounts thereafter received by the Administrative
Agent for account of such Lender to satisfy such Lender’s obligations under
such Sections until all such unsatisfied obligations are fully paid.


                    SECTION
2.21. Mitigation Obligations; Replacement of Lenders.


                    (a)
Designation of a Different Lending Office. If any Lender requests
compensation under Section 2.17, or if any Account Party is required to
pay any additional amount or indemnification payment to any Lender or any
Governmental Authority for account of any Lender pursuant to Section 2.19,
then such Lender shall use reasonable efforts to designate a different lending
office for funding or booking its Loans and/or Letters of Credit hereunder or
to assign its rights and obligations hereunder to another of its offices,
branches or Affiliates, if, in the reasonable judgment of such Lender, such
designation or assignment (i) would eliminate or reduce amounts payable
pursuant to Section 2.17 or 2.19, as the case may be, in the future
and (ii) would not subject such Lender to any unreimbursed cost or expense
and would not otherwise be disadvantageous to such Lender. XL Group hereby
agrees to pay all reasonable costs and expenses incurred by any Lender in
connection with any such designation or assignment. Nothing in this Section
2.21(a) shall affect or postpone any of the obligations of the Account Parties
or the rights of any Lender pursuant to Sections 2.17 or 2.19.


                    (b)
Replacement of Lenders. If any Lender (i) requests compensation under
Section 2.17, or if any Account Party is required to pay any additional
amount to any Lender or any Governmental Authority for account of any Lender
pursuant to Section 2.19, (ii) becomes a Defaulting Lender, (iii) has
refused to consent to any waiver or amendment with respect to any Credit
Document that requires the consent of all the Lenders or of such Lender as a
Lender directly and adversely affected by such waiver or amendment and has been
consented to by the Required Lenders or (iv) if any Lender ceases to be a NAIC
Approved Bank, then XL Group may, at its sole expense and effort, upon notice
to such Lender and the Administrative Agent, require such Lender to assign and
delegate, without recourse (in accordance with and subject to the restrictions
contained in Section 10.04), all its interests, rights and obligations
under this Agreement to an assignee selected by XL Group that shall assume such
obligations (which assignee may be another Lender, if a Lender accepts such
assignment); provided that (i) XL Group shall have received the
prior written consent of the Administrative Agent, which consent shall not
unreasonably be withheld, (ii) such Lender shall have received payment of
an amount equal to the outstanding principal of its Loans and/or LC
Disbursements, accrued interest thereon, accrued fees and all other amounts
payable to it hereunder, from the assignee (to the 


52





extent of such outstanding principal, LC Disbursements
and accrued interest and fees) or the relevant Account Party (in the case of
all other amounts) and (iii) in the case of any such assignment resulting
from a claim for compensation under Section 2.17 or payments required to
be made pursuant to Section 2.19, such assignment will result in a
reduction in such compensation or payments. A Lender shall not be required to
make any such assignment and delegation if, prior thereto, as a result of a
waiver by such Lender or otherwise, the circumstances entitling the relevant
Account Party to require such assignment and delegation cease to apply.


                    (c)
The Account Parties shall not be responsible for any costs and expenses
incurred by any Lender that arranges for its obligations under the Letters of
Credit to be confirmed by a NAIC Approved Bank or by such confirming bank. 


                    SECTION
2.22. Defaulting Lenders. Notwithstanding any provision of this
Agreement to the contrary, if any Lender becomes a Defaulting Lender, then the
following provisions shall apply for so long as such Lender is a Defaulting
Lender:


                    (a)
fees shall cease to accrue on the unfunded portion of the Commitment of such
Defaulting Lender pursuant to Section 2.14;


                    (b) the Commitment and the Credit Exposure of such
Defaulting Lender shall not be included in determining whether the Required
Lenders have taken or may take any action hereunder (including any consent to
any amendment, waiver or other modification pursuant to Section 10.02); provided,
that this clause (b) shall not apply to the vote of a Defaulting Lender in the
case of an amendment, waiver or other modification requiring the consent of
such Lender or each Lender affected thereby; 


                    (c)
if any Participant LC Exposure exists at the time such Lender becomes a
Defaulting Lender and no Default or Event of Default has occurred and is
continuing then:


                              (i)
all or any part of the Participant LC Exposure of such Defaulting Lender shall
be reallocated among the non-Defaulting Lenders in accordance with their
respective Applicable Percentages but only to the extent the sum of all non-Defaulting
Lenders’ aggregate Participant LC Exposure plus the aggregate amount of all
non-Defaulting Lenders’ outstanding Loans plus such Defaulting Lender’s
Participant LC Exposure does not exceed the total of all non-Defaulting
Lenders’ Commitments;


                              (ii)
if the applicable Account Party cash collateralizes any portion of such
Defaulting Lender’s Participant LC Exposure that has not been reallocated
pursuant to clause (i) above, no Specified Account Party shall be required to pay
any fees to such Defaulting Lender pursuant to Section 2.08 with respect to
such Defaulting Lender’s LC Exposure during the period such Defaulting Lender’s
Participant LC Exposure is cash collateralized;


                              (iii)
if the Participant LC Exposure of the non-Defaulting Lenders is reallocated
pursuant to clause (i) above, then the fees payable to the Lenders pursuant to


53





Section 2.14 shall be adjusted in accordance with such
non-Defaulting Lenders’ Applicable Percentages; and


                              (iv)
if all or any portion of such Defaulting Lender’s Participant LC Exposure is
neither reallocated nor cash collateralized pursuant to clause (i) or (ii)
above, then, without prejudice to any rights or remedies of the Issuing Lender
or any other Lender hereunder, all fees payable under Section 2.14 with respect
to such Defaulting Lender’s Participant LC Exposure shall be payable to the
Administrative Agent until and to the extent that such Participant LC Exposure
is reallocated and/or cash collateralized; and


                    (d)
so long as such Lender is a Defaulting Lender, no Issuing Lender shall be
required to issue, amend or increase any Letter of Credit, unless it is
satisfied that the related exposure and the Defaulting Lender’s then
outstanding Participant LC Exposure will be 100% covered by the Commitments of
the non-Defaulting Lenders and/or cash collateral will be provided by the
Obligors in accordance with clause (c) above, and participating interests in
any newly issued or increased Letter of Credit shall be allocated among
non-Defaulting Lenders in a manner consistent with clause (c)(i) above (and
such Defaulting Lender shall not participate therein).


                    In
the event that the Administrative Agent, XL Group and each Issuing Lender each
agrees that a Defaulting Lender has adequately remedied all matters that caused
such Lender to be a Defaulting Lender, then the aggregate Participant LC
Exposure of the Lenders shall be readjusted to reflect the inclusion of such
Lender’s Commitment.


                    SECTION
2.23. Absence of Rating. In the event that XL Insurance (Bermuda), XL Re
or XL Re Europe ceases to receive a financial strength rating from A.M. Best
& Co. (or its successor), such Account Party shall no longer be entitled to
request (i) the issuance of further Letters of Credit hereunder or (ii) the
borrowing of Loans hereunder.


ARTICLE III


GUARANTEE


                    SECTION
3.01. The Guarantee. Each Guarantor hereby jointly and severally irrevocably
guarantees to each Lender and the Administrative Agent and their respective
successors and assigns the prompt payment in full when due (whether at stated
maturity, by acceleration or otherwise) of the principal of and interest on the
Loans made by the Lenders to each of the Account Parties and Reimbursement
Obligations and interest thereon of each Specified Account Party (other than
such Guarantor in its capacity as an Account Party hereunder) and all other
amounts from time to time owing to the Lenders or the Administrative Agent by
such Account Parties under this Agreement, in each case strictly in accordance
with the terms thereof (such obligations being herein collectively called the “Guaranteed
Obligations”). Each Guarantor hereby further jointly and severally agrees
that if any Account Party (other than such Guarantor in its capacity as an
Account Party hereunder) shall fail to pay in full when due (whether at stated
maturity, by acceleration or otherwise) any of the Guaranteed Obligations,


54





such Guarantor will promptly pay the same, without any
demand or notice whatsoever, and that in the case of any extension of time of
payment or renewal of any of the Guaranteed Obligations, the same will be
promptly paid in full when due (whether at extended maturity, by acceleration
or otherwise) in accordance with the terms of such extension or renewal.


                    SECTION
3.02. Obligations Unconditional. The obligations of the Guarantors under
Section 3.01 are absolute and unconditional, joint and several,
irrespective of the value, genuineness, validity, regularity or enforceability
of the obligations of the Account Parties under this Agreement or any other
agreement or instrument referred to herein or therein, or any substitution,
release, non-perfection or exchange of any other guarantee of or security for
any of the Guaranteed Obligations, and, to the fullest extent permitted by
applicable law, irrespective of any other circumstance whatsoever that might
otherwise constitute a legal or equitable discharge or defense of a surety or
guarantor, it being the intent of this Article that the obligations of the
Guarantors hereunder shall be absolute and unconditional, joint and several,
under any and all circumstances (and any defenses arising from the foregoing
are hereby waived to the extent permitted by applicable law). Without limiting
the generality of the foregoing, it is agreed that the occurrence of any one or
more of the following shall not alter or impair the liability of the Guarantors
hereunder, which shall remain absolute and unconditional as described above:


          (i)
at any time or from time to time, without notice to the Guarantors, the time
for any performance of or compliance with any of the Guaranteed Obligations
shall be extended, or such performance or compliance shall be waived;


          (ii)
any law or regulation of any jurisdiction, or the occurrence of any other
event, affecting any Guaranteed Obligation;


          (ii)
any of the acts mentioned in any of the provisions of this Agreement or any
other agreement or instrument referred to herein shall be done or omitted; or


          (iii)
the maturity of any of the Guaranteed Obligations shall be accelerated, or any
of the Guaranteed Obligations shall be modified, supplemented or amended in any
respect, or any right under this Agreement or any other agreement or instrument
referred to herein shall be waived or any other guarantee of any of the
Guaranteed Obligations or any security therefor shall be released or exchanged
in whole or in part or otherwise dealt with;


and any other defenses arising from the foregoing are
hereby waived to the extent permitted by applicable law.


The Guarantors hereby expressly waive diligence,
presentment, demand of payment, protest and all notices whatsoever, and any
requirement that the Administrative Agent or any Lender exhaust any right,
power or remedy or proceed against any Account Party under this Agreement or
any other agreement or instrument referred to herein, or against any other
Person under any other guarantee of, or security for, any of the Guaranteed
Obligations.


                    SECTION
3.03. Reinstatement. The obligations of the Guarantors under this
Article shall be automatically reinstated if and to the extent that for any
reason any payment by or on behalf of any Account Party in respect of the
Guaranteed Obligations is rescinded or must 


55





be otherwise restored by any holder of any of the
Guaranteed Obligations, whether as a result of any proceedings in bankruptcy or
reorganization or otherwise, and the Guarantors jointly and severally agree
that they will indemnify the Administrative Agent and each Lender on demand for
all reasonable costs and expenses (including reasonable fees of counsel)
incurred by the Administrative Agent or such Lender in connection with such
rescission or restoration, including any such costs and expenses incurred in
defending against any claim alleging that such payment constituted a
preference, fraudulent transfer or similar payment under any bankruptcy,
insolvency or similar law.


                    SECTION
3.04. Subrogation. The Guarantors hereby jointly and severally agree
that until the payment and satisfaction in full of all Guaranteed Obligations
and the expiration and termination of the Commitments they shall not exercise
any right or remedy arising by reason of any performance by them of their
guarantee in Section 3.01, whether by subrogation or otherwise, against
any Account Party or any other guarantor of any of the Guaranteed Obligations
or any security for any of the Guaranteed Obligations.


                    SECTION
3.05. Remedies. The Guarantors jointly and severally agree that, as
between the Guarantors and the Lenders, the obligations of the Account Parties
under this Agreement may be declared to be forthwith due and payable as
provided in Article VIII (and shall be deemed to have become automatically due
and payable in the circumstances provided in Article VIII) for purposes of
Section 3.01 notwithstanding any stay, injunction or other prohibition
preventing such declaration (or such obligations from becoming automatically
due and payable) as against any Account Party and that, in the event of such
declaration (or such obligations being deemed to have become automatically due
and payable), such obligations (whether or not due and payable by any Account
Party) shall forthwith become due and payable by the Guarantors for purposes of
Section 3.01.


                    SECTION
3.06. Continuing Guarantee. The guarantee in this Article is a
continuing guarantee, and shall apply to all Guaranteed Obligations whenever
arising.


                    SECTION
3.07. Rights of Contribution. The Guarantors (other than XL Group)
hereby agree, as between themselves, that if any such Guarantor shall become an
Excess Funding Guarantor (as defined below) by reason of the payment by such
Guarantor of any Guaranteed Obligations, each other Guarantor (other than XL
Group) shall, on demand of such Excess Funding Guarantor (but subject to the
next sentence), pay to such Excess Funding Guarantor an amount equal to such
Guarantor’s Pro Rata Share (as defined below and determined, for this purpose,
without reference to the properties, debts and liabilities of such Excess
Funding Guarantor) of the Excess Payment (as defined below) in respect of such
Guaranteed Obligations. The payment obligation of a Guarantor to any Excess
Funding Guarantor under this Section shall be subordinate and subject in right
of payment to the prior payment in full of the obligations of such Guarantor
under the other provisions of this Article III and such Excess Funding
Guarantor shall not exercise any right or remedy with respect to such excess
until payment and satisfaction in full of all of such obligations.


                    For
purposes of this Section, (i) “Excess Funding Guarantor” means, in
respect of any Guaranteed Obligations, a Guarantor that has paid an amount in
excess of its Pro Rata Share of such Guaranteed Obligations, (ii) “Excess
Payment” means, in respect of any Guaranteed 


56





Obligations, the amount paid by an Excess Funding
Guarantor in excess of its Pro Rata Share of such Guaranteed Obligations and
(iii) “Pro Rata Share” means, for any Guarantor, the ratio
(expressed as a percentage) of (x) the amount by which the aggregate
present fair saleable value of all properties of such Guarantor (excluding any
shares of stock of any other Guarantor) exceeds the amount of all the debts and
liabilities of such Guarantor (including contingent, subordinated, unmatured
and unliquidated liabilities, but excluding the obligations of such Guarantor
hereunder and any obligations of any other Guarantor that have been Guaranteed
by such Guarantor) to (y) the amount by which the aggregate fair saleable
value of all properties of all of the Guarantors (other than XL Group) exceeds
the amount of all the debts and liabilities (including contingent,
subordinated, unmatured and unliquidated liabilities, but excluding the
obligations of the Guarantors under this Article III) of all of the Guarantors
(other than XL Group), determined (A) with respect to any Guarantor that
is a party hereto on the date hereof, as of the date hereof, and (B) with
respect to any other Guarantor, as of the date such Guarantor becomes a Guarantor
hereunder.


                    SECTION
3.08. General Limitation on Guarantee Obligations. In any action or
proceeding involving any corporate law, or any bankruptcy, insolvency,
reorganization or other law affecting the rights of creditors generally, if the
obligations of any Guarantor under Section 3.01 would otherwise, taking
into account the provisions of Section 3.07, be held or determined to be
void, invalid or unenforceable, or subordinated to the claims of any other
creditors, on account of the amount of its liability under Section 3.01,
then, notwithstanding any other provision hereof to the contrary, the amount of
such liability shall, without any further action by such Guarantor, any Lender,
the Administrative Agent or any other Person, be automatically limited and
reduced to the highest amount that is valid and enforceable and not
subordinated to the claims of other creditors as determined in such action or
proceeding. 


ARTICLE IV


REPRESENTATIONS
AND WARRANTIES


                    XL
Group, and to the extent any representation pertains specifically to any
Account Party, XL Group and, with respect to itself only, such Account Party,
represents and warrants to the Lenders that: 


                    SECTION
4.01. Organization; Powers. Each Account Party and each of its
Significant Subsidiaries is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization, has all
requisite power and authority to carry on its business as now conducted and,
except where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect, is qualified to
do business in, and is in good standing in, every jurisdiction where such
qualification is required. 


                    SECTION
4.02. Authorization; Enforceability. The Transactions are within each
Account Party’s corporate powers and have been duly authorized by all necessary
corporate and, if required, by all necessary shareholder action. This Agreement
has been duly executed and delivered by each Account Party and constitutes a
legal, valid and binding obligation of such Account Party, enforceable against
such Account Party in accordance with its terms, except as such enforceability
may be limited by (a) bankruptcy, insolvency, reorganization, moratorium,


57





examination or similar laws of general applicability
affecting the enforcement of creditors’ rights and (b) the application of
general principles of equity (regardless of whether such enforceability is considered
in a proceeding in equity or at law).


                    SECTION
4.03. Governmental Approvals; No Conflicts. The Transactions and the
entry into this Agreement (a) do not require any consent or approval of
(including any exchange control approval), registration or filing with, or any
other action by, any Governmental Authority, except such as have been obtained
or made and are in full force and effect, (b) will not violate any
applicable law or regulation or the charter, by-laws or other organizational
documents of each Account Party or any of its Significant Subsidiaries or any
order of any Governmental Authority, (c) will not violate or result in a
default under any material indenture, agreement or other instrument binding
upon each Account Party or any of its Significant Subsidiaries or assets, or
give rise to a right thereunder to require any payment to be made by any such
Person, and (d) will not result in the creation or imposition of any Lien
on any asset of each Account Party or any of its Significant Subsidiaries.


                    SECTION
4.04. Financial Condition; No Material Adverse Change.


                    (a)
Financial Condition. XL Group has heretofore furnished to the Lenders
the financial statements specified in (A) Section 6.01(a)(i) with respect to
the fiscal year ended December 31, 2010 (as provided in XL Group’s Report on
Form 10-K filed with the SEC for the fiscal year ended December 31, 2010) and
(B) Section 6.01(c)(i) with respect to the fiscal quarters ended March 31, 2011,
June 30, 2011 and September 30, 2011 (as provided in XL Group’s Report on Form
10-Q filed with the SEC for the fiscal quarters ended March 31, 2011, June 30,
2011 and September 30, 2011). Such financial statements present fairly in all
material respects the financial position and results of operations of XL Group
and its consolidated Subsidiaries as of such date and for such period on a
consolidated basis in accordance with GAAP subject, in the case of the
quarterly financial statements described in clause (a)(B) to normal year-end
audit adjustments and the absence of footnotes. 


                    (b)
No Material Adverse Change. Since December 31, 2010, there has been no
material adverse change in the assets, business, financial condition or
operations of each Account Party and its Subsidiaries, taken as a whole, except
as disclosed in filings made by XL Group prior to the Effective Date with the
SEC pursuant to the Securities Exchange Act of 1934, as amended.


                    SECTION
4.05. Properties.


                    (a)
Property Generally. Each Account Party and each of its Significant
Subsidiaries has good title to, or valid license or leasehold interests in, all
its real and personal property material to its business, subject only to Liens
permitted by Section 7.03 and except for minor defects in title that do
not interfere with its ability to conduct its business as currently conducted
or to utilize such properties for their intended purposes.


                    (b)
Intellectual Property. Each Account Party and each of its Significant
Subsidiaries owns, or is licensed to use, all trademarks, tradenames,
copyrights, patents and other intellectual property material to its business,
and the use thereof by such Account Party and its


58





Subsidiaries does not infringe upon the rights of any
other Person, except for any such infringements that, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect.


                    SECTION
4.06. Litigation and Environmental Matters.


                    (a)
Actions, Suits and Proceedings. Except as disclosed in Schedule III or
as routinely encountered in claims activity, there are no actions, suits or
proceedings by or before any arbitrator or Governmental Authority now pending
against or, to the knowledge of each Account Party, threatened against or
affecting such Account Party or any of its Subsidiaries (i) as to which an
adverse determination that would, individually or in the aggregate, result in a
Material Adverse Effect is likely or (ii) that involve this Agreement or
the Transactions.


                    (b)
Environmental Matters. Except as disclosed in Schedule IV and except
with respect to any other matters that, individually or in the aggregate, would
not be likely to result in a Material Adverse Effect, no Account Party nor any
of its Subsidiaries (i) has failed to comply with any Environmental Law or
to obtain, maintain or comply with any permit, license or other approval
required for its business under any Environmental Law, (ii) has incurred
any Environmental Liability, (iii) has received notice of any claim with
respect to any Environmental Liability or (iv) knows of any basis for any
Environmental Liability.


                    Schedules
III and IV referred to in this Section 4.06 shall be deemed automatically
updated from time to time to include disclosures included in filings made by XL
Group or XLIT with the SEC pursuant to the Securities Exchange Act of 1934, as
amended, after the Effective Date, it being understood, however, that any such
updates shall not affect or limit in any manner any of the obligations of the
Account Parties under this Agreement in effect immediately prior to such
disclosure and shall not be taken into account for purposes of the last
paragraph of Section 2.11(c), Section 5.02 and clause (c) of Article VIII.


                    SECTION
4.07. Compliance with Laws and Agreements. Each Account Party and each
of its Subsidiaries is in compliance with all laws, regulations and orders of
any Governmental Authority applicable to it or its property and all indentures,
agreements and other instruments binding upon it or its property, except where
the failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect. No Default has occurred and is
continuing.


                    SECTION
4.08. Investment Company Status. Each Account Party is not an
“investment company” as defined in, or subject to regulation under, the
Investment Company Act of 1940.


                    SECTION
4.09. Taxes. Each Account Party and each of its Subsidiaries has timely
filed or caused to be filed all Tax returns and reports required to have been
filed and has paid or caused to be paid all Taxes required to have been paid by
it, except (a) Taxes that are being contested in good faith by appropriate
proceedings and for which such Person has set aside on its books adequate
reserves or (b) to the extent that the failure to file any such Tax return
or pay any such Taxes could not reasonably be expected to result in a Material
Adverse Effect.


                    SECTION
4.10. ERISA. No ERISA Event has occurred or is reasonably


59





expected to occur that, when taken together with all
other such ERISA Events for which liability is reasonably expected to occur,
could reasonably be expected to result in a Material Adverse Effect. The
present value of all accumulated benefit obligations under each Plan (based on
the assumptions used for purposes of Statement of Financial Accounting
Standards No. 87) did not, as of the date of the most recent financial
statements reflecting such amounts, exceed the fair market value of the assets
of such Plan by an amount that could reasonably be expected to result in a
Material Adverse Effect.


                    Except
as could not reasonably be expected to result in a Material Adverse Effect, (i)
all contributions required to be made by any Account Party or any of their
Subsidiaries with respect to a Non-U.S. Benefit Plan have been timely made,
(ii) each Non-U.S. Benefit Plan has been maintained in compliance with its
terms and with the requirements of any and all applicable laws and has been
maintained, where required, in good standing with the applicable Governmental
Authority and (iii) neither any Account Party nor any of their Subsidiaries has
incurred any obligation in connection with the termination or withdrawal from
any Non-U.S. Benefit Plan.


                    SECTION
4.11. Disclosure. The reports, financial statements, certificates or
other information furnished by each Account Party to the Lenders in connection
with the negotiation of this Agreement or delivered hereunder (taken as a
whole) do not contain any material misstatement of fact or omit to state any
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided that,
with respect to projected financial information, such Account Party represents
only that such information was prepared in good faith based upon assumptions
believed to be reasonable at the time.


                    SECTION
4.12. Use of Credit. No Account Party nor any of its Subsidiaries is
engaged principally, or as one of its important activities, in the business of
extending credit for the purpose, whether immediate, incidental or ultimate, of
buying or carrying Margin Stock, no Letter of Credit will be used in connection
with buying or carrying any Margin Stock, and no part of the proceeds of any
Loan hereunder will be used to buy or carry any Margin Stock (except, in each
case, for repurchases of the capital stock of XL Group and purchases of Margin
Stock in accordance with XL Group’s Statement of Investment Policy Objectives
and Guidelines as in effect on the date hereof or as it may be changed from
time to time by a resolution duly adopted by the board of directors of XL Group
(or any committee thereof)). The purchase of any Margin Stock with the proceeds
of any Loan will not be in violation of Regulation U or X of the Board and,
after applying the proceeds of such Loan, not more than 25 percent of the value
of the assets of XL Group and its Subsidiaries taken as a whole consists or
will consist of Margin Stock.


                    SECTION
4.13. Subsidiaries. Set forth in Schedule V is a complete and
correct list of all of the Subsidiaries of XL Group as of September 30, 2011,
together with, for each such Subsidiary, (i) the jurisdiction of
organization of such Subsidiary, (ii) each Person holding ownership interests
in such Subsidiary and (iii) the percentage of ownership of such
Subsidiary represented by such ownership interests. Except as disclosed in
Schedule V, as of the date hereof, (x) each of XL Group and its Subsidiaries
owns, free and clear of Liens, and has the unencumbered right to vote, all
outstanding ownership interests in each Person shown to be held 


60






by it in Schedule V, (y) all of the issued and
outstanding capital stock of each such Person organized as a corporation is
validly issued, fully paid and nonassessable and (z) except as disclosed in
filings of XL Group with the SEC prior to the date hereof, there are no
outstanding Equity Rights with respect to any Account Party.


                    SECTION
4.14. Withholding Taxes. Based upon information with respect to each
Lender provided by each Lender to the Administrative Agent, as of the date
hereof, the payment of the LC Disbursements and interest thereon, principal of
and interest on the Loans, the fees under Section 2.14 and all other amounts
payable hereunder will not be subject, by withholding or deduction, to any
Indemnified Taxes imposed by Bermuda, the Cayman Islands, Switzerland, the
United Kingdom or Ireland.


                    SECTION
4.15. Stamp Taxes. To ensure the legality, validity, enforceability or
admissibility in evidence of this Agreement or any promissory notes evidencing
Loans made (or to be made), it is not necessary, as of the date hereof, that
this Agreement or such promissory notes or any other document be filed or
recorded with any Governmental Authority in Bermuda or Ireland, or that any
stamp or similar tax be paid on or in respect of this Agreement in any such
jurisdiction, or such promissory notes or any other document other than such
filings and recordations that have already been made and such stamp or similar
taxes that have been paid.


                    SECTION
4.16. Legal Form. Each of this Agreement and any promissory notes
evidencing Loans made (or to be made) is in proper legal form as of the date
hereof under the laws of any Account Party Jurisdiction for the admissibility
thereof in the courts of such Account Party Jurisdiction.


ARTICLE V


CONDITIONS


                    SECTION
5.01. Effective Date. The obligations of the Lenders (or the
Issuing Lender, as the case may be) to issue Letters of Credit and/or to make
Loans hereunder initially are subject to the receipt by the Administrative
Agent of each of the following documents, each of which shall be satisfactory
to the Administrative Agent (and to the extent specified below, to each Lender)
in form and substance (or such condition shall have been waived in accordance
with Section 10.02):


	
  

 	
  

 
	
  

 	
           (a)
 Executed Counterparts. From each party hereto either (x) a
 counterpart of this Agreement signed on behalf of such party or
 (y) written evidence satisfactory to the Administrative Agent (which may
 include telecopy or email transmission of a signed signature page to this
 Agreement) that such party has signed a counterpart of this Agreement.

 
	
  

 	
  

 
	
  

 	
           (b)
 Opinions of Counsel to the Obligors. Opinions, each dated the
 Effective Date, of Cleary Gottlieb Steen & Hamilton LLP, special U.S.
 counsel for the Obligors and opinions provided by counsel to the applicable
 Obligors in the jurisdictions of Ireland, the Cayman Islands, Bermuda, the
 United Kingdom and Switzerland, in each case, reasonably satisfactory to the
 Administrative Agent and its counsel.

 


61









	
  

 	
  

 
	
  

 	
           (d)
 Corporate Documents. Such documents and certificates as the
 Administrative Agent or its counsel may reasonably request relating to the
 organization, existence and good standing, if applicable, of the Obligors,
 the authorization of the Transactions and any other legal matters relating to
 the Obligors, this Agreement or the Transactions, all in form and substance
 reasonably satisfactory to the Administrative Agent and its counsel.

 
	
  

 	
  

 
	
  

 	
           (e)
 Officer’s Certificate. A certificate, dated the Effective Date and
 signed by the President, a Vice President or a Financial Officer of XL Group,
 confirming compliance with the conditions set forth in clauses (a) and (b) of
 the first sentence of Section 5.02.

 
	
  

 	
  

 
	
  

 	
           (f)
 Existing Unsecured Credit Agreement. Evidence reasonably satisfactory
 to the Administrative Agent that (i) the Commitments under (and as defined
 in) the Existing Unsecured Credit Agreement have been terminated and (ii) all
 amounts due and payable under the Existing Unsecured Credit Agreement have
 been paid.

 
	
  

 	
  

 
	
  

 	
           (g)
 Arrangements for Continuation. Evidence reasonably satisfactory to the
 Administrative Agent of the existence of arrangements for continuation under
 this Agreement, the Existing Secured Credit Agreement or the Secured Credit
 Agreement of all existing letters of credit issued under the Existing
 Unsecured Credit Agreement. 

 
	
  

 	
  

 
	
  

 	
           (h)
 Secured Facility. Evidence reasonably satisfactory to the
 Administrative Agent of the entry into the Secured Credit Agreement by the
 Account Parties. 

 
	
  

 	
  

 
	
  

 	
           (i)
 Financial Statements. Receipt by the Administrative Agent of the
 financial statements specified in Section 6.01(a)(i) with respect to the
 fiscal year ended December 31, 2010 (it being understood that delivery to the
 Administrative Agent of XL Group’s Report on Form 10-K filed with the SEC
 shall satisfy the financial statement delivery requirements under this
 Section 5.01(i)).

 
	
  

 	
  

 
	
  

 	
           (j)
 Other Documents. Such other documents as the Administrative Agent or
 any Lender or special New York counsel to JPMCB may reasonably request.

 



                    The
obligation of any Lender to make its initial extension of credit or initial
issuance of a Letter of Credit hereunder is also subject to the payment by XL
Group of such fees as XL Group shall have agreed to pay to any Lender or the
Administrative Agent in connection herewith, including the reasonable fees and
expenses of Simpson Thacher & Bartlett LLP, special New York counsel to
JPMCB, in connection with the negotiation, preparation, execution and delivery
of this Agreement and the other Credit Documents and the extensions of credit
hereunder (to the extent that reasonably detailed statements for such fees and
expenses have been delivered to XL Group).


                    The
Administrative Agent shall notify the Account Parties and the Lenders of the
Effective Date, and such notice shall be conclusive and binding.
Notwithstanding the foregoing, the obligations of the Lenders (or the Issuing
Lender, as the case may be) to issue Letters of Credit or to make Loans
hereunder initially shall not become effective unless each of the foregoing
conditions is satisfied (or waived pursuant to Section 10.02) at or prior
to 5:00 p.m., New York City time, on December 30, 2011 (and, in the event
such conditions are not so satisfied or waived, the Commitments shall terminate
at such time).


62





                    SECTION
5.02. Each Credit Event. The obligation of each Lender to issue, continue,
amend, renew or extend any Letter of Credit or to make any Loan at any time is
additionally subject to the satisfaction of the following conditions:


	
  

 	
  

 
	
  

 	
           (a)
 the representations and warranties of the Obligors set forth in this
 Agreement (other than, at any time after the Effective Date, in Section
 4.04(b)) shall be true and correct on and as of the date of issuance,
 continuation, amendment, renewal or extension of such Letter of Credit or the
 date of the making of such Loan, as applicable (or, if any such
 representation or warranty is expressly stated to have been made as of a
 specific date, as of such specific date);

 
	
  

 	
  

 
	
  

 	
           (b)
 at the time of and immediately after giving effect to the issuance,
 amendment, renewal or extension of such Letter of Credit or the making of
 such Loan, as applicable, no Default shall have occurred and be continuing;
 and

 
	
  

 	
  

 
	
  

 	
           (c)
 in the case of any Alternative Currency Letter of Credit, receipt by the
 Administrative Agent of a request for offers as required by Section 2.06(a).

 



Each issuance, continuation, amendment, renewal or
extension of a Letter of Credit and each borrowing of a Loan shall be deemed to
constitute a representation and warranty by the Obligors on the date thereof as
to the matters specified in clauses (a) and (b) of the immediately preceding
sentence.


ARTICLE VI


AFFIRMATIVE
COVENANTS


                    Until
the Commitments have expired or been terminated, the principal of and interest
on each Loan and all fees payable hereunder shall have been paid in full, all
Letters of Credit shall have expired or terminated and all LC Disbursements
shall have been reimbursed, XL Group, and to the extent any covenant applies
specifically to any Account Party or its financial statements, XL Group and,
with respect to itself only, such Account Party, covenants and agrees with the
Lenders that:


                    SECTION
6.01. Financial Statements and Other Information. The Administrative
Agent and each Lender will receive:


	
  

 	
  

 
	
  

 	
           (a)
 by April 10 of each year, (i) the audited balance sheet and related
 statements of operations, stockholders’ equity and cash flows of XL Group and
 its consolidated Subsidiaries as of the end of and for the immediately
 preceding fiscal year, setting forth in comparative form the figures for (or,
 in the case of the balance sheet, as of the end of) the previous fiscal year
 (if such figures were already produced for such corresponding period),
 reported on by independent public accountants of recognized national standing
 (without a “going concern” or like qualification or exception and without any
 qualification or exception as to the scope of such audit) to the effect that
 such financial statements present fairly in all material respects the
 financial condition and results of operations of XL Group and its
 consolidated Subsidiaries on a consolidated basis in accordance with GAAP
 consistently applied (it being understood that delivery to the 

 


63









	
  

 	
  

 
	
  

 	
 Lenders of XL Group’s Report on Form 10-K filed with
 the SEC shall satisfy the financial statement delivery requirements under
 this clause (i) so long as the financial information required to be contained
 in such report is substantially the same as the financial information
 required under this clause (i)); and (ii) the unaudited consolidated balance
 sheet and related statements of operations, stockholders’ equity and cash
 flows of XLIT and its consolidated Subsidiaries as of the end of and for the
 immediately preceding fiscal year, setting forth in each case in comparative
 form the figures for (or, in the case of the balance sheet, as of the end of)
 the previous fiscal year (if such figures were already produced for such
 corresponding period), certified by a Financial Officer of XLIT as presenting
 fairly in all material respects the financial condition and results of
 operations of XLIT and its consolidated Subsidiaries on a consolidated basis
 in accordance with GAAP consistently applied, subject to normal year-end
 audit adjustments and the absence of footnotes;

 
	
  

 	
  

 
	
  

 	
           (b)
 (i) by May 15 of each year, the balance sheet and related statements of
 operations and stockholders’ equity of each of XL Insurance (Bermuda), XL Re,
 XL Re Europe, XL Insurance, XL Switzerland and XL Life (in each case, in the
 event consolidated financial statements are prepared in the ordinary course
 of business, prepared in a manner that consolidates the applicable
 consolidated Subsidiaries) as of the end of and for the immediately preceding
 year, setting forth in each case in comparative form the figures for (or, in
 the case of the balance sheet, as of the end of) the previous fiscal year (if
 such figures were already produced for such corresponding period), in each
 case audited and reported on by independent public accountants of recognized
 national standing (without a “going concern” or like qualification or
 exception and without any qualification or exception as to the scope of such
 audit) in accordance with GAAP, Local GAAP, SAP or SFR, as the case may be,
 consistently applied; (ii) by June 15 of each year, the unaudited
 consolidated balance sheet and related statements of operations,
 stockholders’ equity and cash flows of XL America and its consolidated
 Subsidiaries as of the end of and for the immediately preceding fiscal year,
 setting forth in each case in comparative form the figures for (or, in the
 case of the balance sheet, as of the end of) the previous fiscal year (if
 such figures were already produced for such corresponding period), certified
 by a Financial Officer of XL America as presenting fairly in all material
 respects the financial condition and results of operations of XL America and
 its consolidated Subsidiaries on a consolidated basis in accordance with GAAP
 consistently applied, subject to normal year-end audit adjustments and the absence
 of footnotes; and (iii) by June 15 of each year, audited statutory financial
 statements for each Insurance Subsidiary of XL America as of the end of and
 for the immediately preceding fiscal year, in each case reported on by
 independent public accountants of recognized national standing (without a
 “going concern” or like qualification or exception and without any
 qualification or exception as to the scope of such audit) to the effect that
 such audited financial statements present fairly in all material respects the
 financial condition and results of operations of such Insurance Subsidiary in
 accordance with SAP consistently applied;

 
	
  

 	
  

 
	
  

 	
           (c)
 within 60 days after the end of each of the first three fiscal quarters of
 each fiscal year of XL Group, (i) the unaudited consolidated balance sheet
 and related statements of operations, stockholders’ equity and cash flows of
 XL Group and its 

 


64









	
  

 	
  

 
	
  

 	
 consolidated Subsidiaries as of the end of and for
 such fiscal quarter and the then elapsed portion of the fiscal year, setting
 forth in each case in comparative form the figures for (or, in the case of
 the balance sheet, as of the end of) the corresponding period or periods of
 the previous fiscal year (if such figures were already produced for such
 corresponding period or periods), all certified by a Financial Officer of XL
 Group as presenting fairly in all material respects the financial condition
 and results of operations of XL Group and its consolidated Subsidiaries on a
 consolidated basis in accordance with GAAP consistently applied, subject to
 normal year-end audit adjustments and the absence of footnotes (it being
 understood that delivery to the Lenders of XL Group’s Report on Form 10-Q
 filed with the SEC shall satisfy the financial statement delivery requirements
 under this clause (i) so long as the financial information required to be
 contained in such report is substantially the same as the financial
 information required under this clause (i)); and (ii) an unaudited balance
 sheet and related statements of operations and stockholders’ equity of each
 of XLIT, XL America, XL Insurance (Bermuda), XL Re, XL Re Europe, XL
 Insurance, XL Switzerland and XL Life (in each case, in the event
 consolidated financial statements are prepared in the ordinary course of business,
 prepared in a manner that consolidates the applicable consolidated
 Subsidiaries) as of the end of and for such fiscal quarter and the then
 elapsed portion of the fiscal year, setting forth in each case in comparative
 form the figures for (or, in the case of the balance sheet, as of the end of)
 the corresponding period or periods of the previous fiscal year (if such
 figures were already produced for such corresponding period or periods), all
 certified by a Financial Officer of the respective Account Party as
 presenting fairly in all material respects the financial condition and
 results of operations of such Account Party (or, if applicable, of such
 Account Party and its consolidated Subsidiaries on a consolidated basis) in
 accordance with GAAP, Local GAAP, SAP or SFR, as the case may be,
 consistently applied, subject to normal year-end audit adjustments and the
 absence of footnotes;

 
	
  

 	
  

 
	
  

 	
           (d)
 concurrently with any delivery of financial statements under paragraph (a),
 (b) or (c) of this Section, a certificate signed on behalf of each Account
 Party by a Financial Officer (i) certifying as to whether a Default has
 occurred and, if a Default has occurred, specifying the details thereof and
 any action taken or proposed to be taken with respect thereto, (ii) setting
 forth reasonably detailed calculations demonstrating compliance with Sections
 7.03, 7.05, 7.06 and 7.07 and (iii) stating whether any change in GAAP, Local
 GAAP, SAP or SFR or in the application thereof has occurred since the date of
 the financial statements referred to in Section 4.04 and, if any such change
 has occurred, specifying any material effect of such change on the financial
 statements accompanying such certificate; 

 
	
  

 	
  

 
	
  

 	
           (e)
 promptly after the same become publicly available, copies of all periodic and
 other reports, proxy statements and other materials filed by such Account
 Party or any of its respective Subsidiaries with the SEC, or any Governmental
 Authority succeeding to any or all of the functions of the SEC, or with any
 U.S. or other securities exchange, or distributed by such Account Party to
 its shareholders generally, as the case may be;

 
	
  

 	
  

 
	
  

 	
           (f)
 concurrently with any delivery of financial statements under paragraph (a),
 (b) or (c) of this Section, a certificate of a Financial Officer of XL Group,
 setting forth on a consolidated basis for XL Group and its consolidated
 Subsidiaries as of the end of the

 


65









	
  

 	
  

 
	
  

 	
 fiscal year or quarter to which such certificate
 relates (i) the aggregate book value of assets which are subject to Liens
 permitted under Section 7.03(g) and the aggregate book value of liabilities
 which are subject to Liens permitted under Section 7.03(g)(it being
 understood that the reports required by paragraphs (a), (b) and (c) of this
 Section shall satisfy the requirement of this clause (i) of this paragraph
 (f) if such reports set forth separately, in accordance with GAAP, line items
 corresponding to such aggregate book values) and (ii) a calculation showing
 the portion of each of such aggregate amounts which portion is attributable
 to transactions among wholly-owned Subsidiaries of XL Group;

 
	
  

 	
  

 
	
  

 	
           (g)
 within 90 days after the end of each of the first three fiscal quarters of
 each fiscal year and within 135 days after the end of each fiscal year of XL
 Group (commencing with the fiscal year ending December 31, 2011), a statement
 of a Financial Officer of XL Group listing, as of the end of the immediately
 preceding fiscal quarter of XL Group, the amount of cash and the securities
 of the Account Parties and their Subsidiaries that have been posted as
 collateral under Section 7.03(e); and

 
	
  

 	
  

 
	
  

 	
           (h)
 promptly following any request therefor, such other information regarding the
 operations, business affairs and financial condition of XL Group or any of
 its Subsidiaries, or compliance with the terms of this Agreement, as the
 Administrative Agent or any Lender may reasonably request.

 



                    SECTION
6.02. Notices of Material Events. Each Account Party will furnish to the
Administrative Agent and each Lender prompt written notice of the following:


	
  

 	
  

 
	
  

 	
           (a)
 the occurrence of any Default; and

 
	
  

 	
  

 
	
  

 	
           (b)
 any event or condition constituting, or which could reasonably be expected to
 have a Material Adverse Effect.

 



Each notice delivered under this Section shall be
accompanied by a statement of a Financial Officer or other executive officer of
the relevant Account Party setting forth the details of the event or
development requiring such notice and any action taken or proposed to be taken
by such Account Party with respect thereto.


                    SECTION
6.03. Preservation of Existence and Franchises. Each Account Party will,
and will cause each of its Significant Subsidiaries to, maintain its corporate
existence and its material rights and franchises in full force and effect in
its jurisdiction of incorporation; provided that the foregoing shall not
prohibit (x) any merger or consolidation permitted under Section 7.01 or (y)
any Disposition permitted under Section7.02(e). Each Account Party will, and
will cause each of its Subsidiaries to, qualify and remain qualified as a
foreign corporation in each jurisdiction in which failure to receive or retain
such qualification would have a Material Adverse Effect.


                    SECTION
6.04. Insurance. Each Account Party will, and will cause each of its
Significant Subsidiaries to, maintain with financially sound and reputable
insurers, insurance with respect to its properties in such amounts as is
customary in the case of corporations engaged


66





in the same or similar businesses having similar
properties similarly situated.


                    SECTION
6.05. Maintenance of Properties. Each Account Party will, and will cause
each of its Subsidiaries to, maintain or cause to be maintained in good repair,
working order and condition the properties now or hereafter owned, leased or
otherwise possessed by and used or useful in its business and will make or
cause to be made all needful and proper repairs, renewals, replacements and
improvements thereto so that the business carried on in connection therewith
may be properly conducted at all times except if the failure to do so would not
have a Material Adverse Effect, provided, however, that the
foregoing shall not impose on such Account Party or any Subsidiary of such
Account Party any obligation in respect of any property leased by such Account
Party or such Subsidiary in addition to such Account Party’s obligations under
the applicable document creating such Account Party’s or such Subsidiary’s
lease or tenancy.


                    SECTION
6.06. Payment of Taxes and Other Potential Charges and Priority Claims;
Payment of Other Current Liabilities. Each Account Party will, and will
cause each of its Subsidiaries to, pay or discharge:


	
  

 	
  

 
	
  

 	
           (a)
 on or prior to the date on which penalties attach thereto, all taxes,
 assessments and other governmental charges or levies imposed upon it or any
 of its properties or income; 

 
	
  

 	
  

 
	
  

 	
           (b)
 on or prior to the date when due, all lawful claims of materialmen,
 mechanics, carriers, warehousemen, landlords and other like Persons which, if
 unpaid, might result in the creation of a Lien upon any such property; and

 
	
  

 	
  

 
	
  

 	
           (c)
 on or prior to the date when due, all other lawful claims which, if unpaid,
 might result in the creation of a Lien upon any such property (other than
 Liens not forbidden by Section 7.03) or which, if unpaid, might give rise to
 a claim entitled to priority over general creditors of such Account Party or
 such Subsidiary in any proceeding under the Bermuda Companies Law, or Bermuda
 Insurance Law, or any insolvency proceeding, liquidation, receivership,
 rehabilitation, dissolution or winding-up involving such Account Party or
 such Subsidiary;

 



provided
that unless and until foreclosure, distraint, levy, sale or similar proceedings
shall have been commenced, such Account Party or such Subsidiary need not pay
or discharge any such tax, assessment, charge, levy or claim (i) so long as the
validity thereof is contested in good faith and by appropriate proceedings
diligently conducted and so long as such reserves or other appropriate
provisions as may be required by GAAP, Local GAAP, SAP or SFR, as the case may
be, shall have been made therefor or (ii) so long as such failure to pay or
discharge would not have a Material Adverse Effect.


                    SECTION
6.07. Financial Accounting Practices. Each Account Party will, and will
cause each of its consolidated Subsidiaries to, make and keep books, records
and accounts which, in reasonable detail, accurately and fairly reflect its
transactions and dispositions of its assets and maintain a system of internal
accounting controls sufficient to provide reasonable assurances that
transactions are recorded as necessary to permit preparation of financial


67





statements required under Section 6.01 in conformity
with GAAP, Local GAAP, SAP and SFR, as applicable, and to maintain
accountability for assets.


                    SECTION
6.08. Compliance with Applicable Laws. Each Account Party will, and will
cause each of its Subsidiaries to, comply with all applicable Laws (including
but not limited to the Bermuda Companies Law or Bermuda Insurance Law) in all
respects; provided that such Account Party or any Subsidiary of such
Account Party will not be deemed to be in violation of this Section as a result
of any failure to comply with any such Law which would not (i) result in fines,
penalties, injunctive relief or other civil or criminal liabilities which, in
the aggregate, would have a Material Adverse Effect or (ii) otherwise impair
the ability of such Account Party to perform its obligations under this
Agreement.


                    SECTION
6.09. Use of Letters of Credit and Loan Proceeds. No part of the
proceeds of any Loan and no Letter of Credit will be used, whether directly or
indirectly, for any purpose that entails a violation of any of the regulations
of the Board, including Regulations U and X. Each Account Party will use the
Letters of Credit issued for its account hereunder in the ordinary course of
business of, and will use the proceeds of all Loans made to it for the general
corporate purposes of, such Account Party and its Affiliates. For the avoidance
of doubt, the parties agree that any Account Party may apply for a Letter of
Credit hereunder to support the obligations of any Affiliate of XL Group, it
being understood that such Account Party shall nonetheless remain the account
party and as such be liable with respect to such Letter of Credit. 


                    SECTION
6.10. Continuation of and Change in Businesses. The Account Parties and
their respective Significant Subsidiaries, taken as a whole, will continue to
engage in substantially the same business or businesses they engaged in (or
propose to engage in) on the date of this Agreement and businesses related or
incidental thereto; provided that the foregoing shall not prohibit any
Disposition permitted under Section 7.02(e).


                    SECTION
6.11. Visitation. Each Account Party will permit such Persons as any
Lender may reasonably designate to visit and inspect any of the properties
(including books and records) of such Account Party, to discuss its affairs
with its financial management, and provide such other information relating to
the business and financial condition of such Account Party at such times as
such Lender may reasonably request. Each Account Party hereby authorizes its
financial management to discuss with any Lender the affairs of such Account
Party.


ARTICLE VII


NEGATIVE COVENANTS


                    Until
the Commitments have expired or terminated, the principal of and interest on
each Loan and all fees payable hereunder have been paid in full, all Letters of
Credit have expired or terminated and all LC Disbursements have been reimbursed,
XL Group, and to the extent any covenant applies specifically to any Account
Party, such Account Party, with respect to itself only, covenants and agrees
with the Lenders that:


                    SECTION
7.01. Mergers. No Account Party will merge with or into or


68





consolidate with any other Person, except that if no
Default shall occur and be continuing or shall exist at the time of such merger
or consolidation or immediately thereafter and after giving effect thereto (a)
any Account Party may merge or consolidate with any other corporation,
including a Subsidiary, if such Account Party shall be the surviving
corporation, (b) XL Group may merge with or into or consolidate with any other
Person in a transaction that does not result in a reclassification, conversion,
exchange or cancellation of the outstanding shares of capital stock of XL Group
(other than the cancellation of any outstanding shares of capital stock of XL
Group held by the Person with whom it merges or consolidates), (c) any Account
Party may enter into a merger or consolidation which is effected solely to
change the jurisdiction of incorporation of such Account Party and results in a
reclassification, conversion or exchange of outstanding shares of capital stock
of such Account Party solely into shares of capital stock of the surviving
entity and (d) any Account Party may merge or consolidate with any other
Account Party or any Subsidiary if the obligations hereunder of the
non-surviving Account Party with respect to any outstanding Letters of Credit
issued for its account have been (i) assumed by another Account Party, (ii)
terminated or expired or (iii) dealt with in any other manner reasonably
satisfactory to the Administrative Agent (after consultation with the Lenders).


                    SECTION
7.02. Dispositions. No Account Party will, nor will it permit any of its
Significant Subsidiaries to, sell, convey, assign, lease, abandon or otherwise
transfer or dispose of, voluntarily or involuntarily (any of the foregoing
being referred to in this Section as a “Disposition” and any series of
related Dispositions constituting but a single Disposition), any of its
properties or assets, tangible or intangible (including but not limited to
sale, assignment, discount or other disposition of accounts, contract rights,
chattel paper or general intangibles with or without recourse), except:


	
  

 	
  

 
	
  

 	
           (a)
 Dispositions in the ordinary course of business involving current assets or
 other invested assets classified on such Account Party’s or its respective
 Subsidiaries’ balance sheet as available for sale or as a trading account;

 
	
  

 	
  

 
	
  

 	
           (b)
 sales, conveyances, assignments or other transfers or dispositions in
 immediate exchange for cash or tangible assets, provided that any such
 sales, conveyances or transfers shall not individually, or in the aggregate
 for the Account Parties and their respective Subsidiaries (taken together
 with any other Dispositions previously made pursuant to this Section
 7.02(b)), exceed 5% of Consolidated Total Assets at the time of the making of
 such Disposition;

 
	
  

 	
  

 
	
  

 	
           (c)
 Dispositions of equipment or other property which is obsolete or no longer
 used or useful in the conduct of the business of such Account Party or its
 Subsidiaries;

 
	
  

 	
  

 
	
  

 	
           (d)
 Dispositions from an Account Party or a wholly-owned Subsidiary to any other
 Account Party or wholly-owned Subsidiary; or

 
	
  

 	
  

 
	
  

 	
           (e)
 the Disposition of all or any portion of the life reinsurance operations (the
 “Life Operations”) conducted directly or indirectly by any Account Party
 (including through the Disposition of a Subsidiary that conducts Life
 Operations); provided that, if, after giving effect to such Disposition, such
 Account Party would no longer exist or have any operations, such Disposition shall
 only be permitted if the obligations hereunder of

 


69









	
  

 	
  

 
	
  

 	
 such Account Party with respect to any outstanding
 Letters of Credit issued for its account have been (i) assumed by another
 Account Party, (ii) terminated or expired or (iii) dealt with in any other
 manner reasonably satisfactory to the Administrative Agent (after
 consultation with the Lenders).

 



                    SECTION
7.03. Liens. No Account Party will, nor will it permit any of its
Subsidiaries to, create, incur, assume or permit to exist any Lien on any
property or assets, tangible or intangible, now owned or hereafter acquired by
it, except:


	
  

 	
  

 
	
  

 	
           (a)
 Liens securing Indebtedness incurred under the Secured Credit Agreement or
 otherwise granted under the security documents described therein (including
 extensions, renewals and replacements thereof); 

 
	
  

 	
  

 
	
  

 	
           (b)
 Liens securing Indebtedness incurred under the Existing Secured Credit
 Agreement or otherwise granted under the security documents described therein
 (including extensions, renewals and replacements thereof); 

 
	
  

 	
  

 
	
  

 	
           (c)
 Liens existing on the date hereof (and extension, renewal and replacement
 Liens upon the same property, provided that the principal amount
 secured by each Lien constituting such an extension, renewal or replacement
 Lien shall not exceed the amount secured by the Lien theretofore existing)
 and listed on Part B of Schedule II;

 
	
  

 	
  

 
	
  

 	
           (d)
 Liens securing Indebtedness permitted by Section 7.07(d) covering assets
 whose market value is not materially greater than the amount of the
 Indebtedness secured thereby plus a commercially reasonable margin;

 
	
  

 	
  

 
	
  

 	
           (e)
 Liens on cash and securities of an Account Party or any of its Subsidiaries
 incurred as part of treasury management or the management of its investment
 portfolio including, but not limited to, (i) any custody, investment
 management or other service provider arrangements or (ii) pursuant to
 any International Swaps and Derivatives Association, Inc. (“ISDA”)
 documentation or any Specified Transaction Agreement in accordance with XL
 Group’s Statement of Investment Policy Objectives and Guidelines as in effect
 as of the date of entry into the ISDA or Specified Transaction Agreement or
 as it may be changed from time to time by a resolution duly adopted by the
 board of directors of XL Group (or any committee thereof);

 
	
  

 	
  

 
	
  

 	
           (f)
 Liens on cash and securities not to exceed $1,000,000,000 in the aggregate
 securing obligations of an Account Party or any of its Subsidiaries arising
 under any ISDA documentation or any other Specified Transaction Agreement (it
 being understood that in no event shall this clause (f) preclude any Person
 (other than any Subsidiary of XL Group) in which XL Group or any of its
 Subsidiaries shall invest (each an “investee”) from granting Liens on
 such Person’s assets to secure hedging obligations of such Person, so long as
 such obligations are non-recourse to XL Group or any of its Subsidiaries
 (other than any investees)), provided that, for purposes of
 determining the aggregate amount of cash and/or securities subject to such
 Liens under this clause (f), the aggregate amount of cash and/or securities
 on which any Account Party or any Subsidiary shall have granted Liens in
 favor of the counterparties of such Account Party or such Subsidiary at any
 time

 


70









	
  

 	
  

 
	
  

 	
 shall be
 netted against the aggregate amount of cash and/or securities on which such
 counterparties shall have granted Liens in favor of such Account Party or
 such Subsidiary, as the case may be, at such time, so long as the relevant
 agreements between such Account Party or such Subsidiary, as the case may be,
 provide for the netting of their respective obligations thereunder;

 
	
  

 	
  

 
	
  

 	
           (g)
 Liens on (i) assets received, and on actual or imputed investment income on
 such assets received incurred as part of its business including activities
 utilizing ISDA documentation or any Specified Transaction Agreement relating
 and identified to specific insurance payment liabilities or to liabilities
 arising in the ordinary course of any Account Parties’ or any of their
 Subsidiary’s business as an insurance or reinsurance company (including GICs
 and Stable Value Instruments) or corporate member of The Council of Lloyd’s
 or as a provider of financial or investment services or contracts, or the
 proceeds thereof (including GICs and Stable Value Instruments), in each case
 held in a segregated trust, trust or other account and securing such
 liabilities, (ii) assets securing Exempt Indebtedness of any Person (other
 than XL Group or any of its Affiliates) in the event such Exempt Indebtedness
 is consolidated on the consolidated balance sheet of XL Group and its
 consolidated Subsidiaries in accordance with GAAP or (iii) any other assets
 subject to any trust or other account arising out of or as a result of
 contractual, regulatory or any other requirements; provided that in no
 case shall any such Lien secure Indebtedness and any Lien which secures
 Indebtedness shall not be permitted under this clause (g);

 
	
  

 	
  

 
	
  

 	
           (h)
 Liens arising from taxes, assessments, charges, levies or claims described in
 Section 6.06 that are not yet due or that remain payable without penalty or
 to the extent permitted to remain unpaid under the provision of Section 6.06;

 
	
  

 	
  

 
	
  

 	
           (i)
 Liens on property securing all or part of the purchase price thereof to such
 Account Party and Liens (whether or not assumed) existing on property at the
 time of purchase thereof by such Account Party (and extension, renewal and
 replacement Liens upon the same property); provided (i) each such Lien
 is confined solely to the property so purchased, improvements thereto and
 proceeds thereof, and (ii) the aggregate amount of the obligations secured by
 all such Liens on any particular property at any time purchased by such
 Account Party, as applicable, shall not exceed 100% of the lesser of the fair
 market value of such property at such time or the actual purchase price of
 such property;

 
	
  

 	
  

 
	
  

 	
           (j)
 Liens existing on property of a Person immediately prior to its being
 consolidated with or merged into any Account Party or any of their
 Subsidiaries or its becoming a Subsidiary, and Liens existing on any property
 acquired by any Account Party or any of their Subsidiaries at the time such
 property is so acquired (whether or not the Indebtedness secured thereby shall
 have been assumed) (and extension, renewal and replacement Liens upon the
 same property, provided that the amount secured by each Lien
 constituting such an extension, renewal or replacement Lien shall not exceed
 the amount secured by the Lien theretofore existing), provided that
 (i) no such Lien shall have been created or assumed in contemplation of such
 consolidation or merger or such Person’s becoming a Subsidiary or such
 acquisition of property and (ii) each such Lien shall extend solely to the
 item or items of property so acquired and, if required by terms 

 


71









	
  

 	
  

 
	
  

 	
 of the
 instrument originally creating such Lien, other property which is an
 improvement to or is acquired for specific use in connection with such
 acquired property;

 
	
  

 	
  

 
	
  

 	
           (k)
 zoning restrictions, easements, minor restrictions on the use of real
 property, minor irregularities in title thereto and other minor Liens that do
 not in the aggregate materially detract from the value of a property or asset
 to, or materially impair its use in the business of, such Account Party or
 any such Subsidiary;

 
	
  

 	
  

 
	
  

 	
           (l)
 statutory and common law Liens of materialmen, mechanics, carriers,
 warehousemen and landlords and other similar Liens arising in the ordinary
 course of business; 

 
	
  

 	
  

 
	
  

 	
           (m)
 Liens incurred in connection with the bonding of any judgment; and

 
	
  

 	
  

 
	
  

 	
           (n)
 Liens created pursuant to the second and third to last paragraphs of Article
 VIII.

 



                    SECTION
7.04. Transactions with Affiliates. No Account Party will, nor will it
permit any of its Significant Subsidiaries to, enter into or carry out any
transaction with (including purchase or lease property or services to, loan or
advance to or enter into, suffer to remain in existence or amend any contract,
agreement or arrangement with) any Affiliate of such Account Party, or directly
or indirectly agree to do any of the foregoing, except (i) transactions
involving guarantees or co-obligors with respect to any Indebtedness described
in Part A of Schedule II, (ii) transactions among the Account Parties
and their wholly-owned Subsidiaries, (iii) transactions with Affiliates in
good faith in the ordinary course of such Account Party’s business consistent
with past practice and on terms no less favorable to such Account Party or any
Subsidiary than those that could have been obtained in a comparable transaction
on an arm’s length basis from an unrelated Person and (iv) transactions
permitted by Sections 7.01 and 7.07.


                      SECTION
7.05. Ratio of Total Funded Debt to Total Capitalization. XL Group will
not permit at any time its ratio of (a) Total Funded Debt to (b) the sum of
Total Funded Debt plus Consolidated Net Worth to be greater than
0.35:1.00.


                      SECTION
7.06. Consolidated Net Worth. XL Group will not permit at any time its
Consolidated Net Worth to be less than the sum of (a) $6,609,000,000 plus (b)
25% of consolidated net income (if positive) of XL Group and its Subsidiaries
for each fiscal quarter ending after September 30, 2011.


                      SECTION
7.07. Indebtedness. No Account Party will, nor will it permit any of its
Subsidiaries to, at any time create, incur, assume or permit to exist any
Indebtedness, or agree, become or remain liable (contingent or otherwise) to do
any of the foregoing, except:


	
  

 	
  

 
	
  

 	
           (a)
 Indebtedness created hereunder;

 
	
  

 	
  

 
	
  

 	
           (b)
 Indebtedness incurred under the Existing Secured Credit Agreement and
 Indebtedness incurred under the Secured Credit Agreement;

 


72









	
  

 	
  

 
	
  

 	
           (c)
 other Indebtedness existing on the date hereof and described in Part A
 of Schedule II and extensions, renewals and replacements of any such
 Indebtedness that do not increase the outstanding principal amount thereof;

 
	
  

 	
  

 
	
  

 	
           (d)
 other secured Indebtedness (including secured reimbursement obligations with
 respect to letters of credit) of any Account Party or any Subsidiary in an
 aggregate principal amount (for all Account Parties and their respective
 Subsidiaries) not exceeding 15% of Consolidated Net Worth at the time of
 incurrence;

 
	
  

 	
  

 
	
  

 	
           (e)
 Indebtedness incurred in transactions described in Section 7.03(e) and (f); 

 
	
  

 	
  

 
	
  

 	
           (f)
 Indebtedness consisting of accounts or claims payable and accrued and
 deferred compensation (including options) incurred in the ordinary course of
 business by any Account Party or any Subsidiary; and

 
	
  

 	
  

 
	
  

 	
           (g)
 other unsecured Indebtedness, so long as upon the incurrence thereof no
 Default would occur or exist.

 



                    SECTION
7.08. Financial Strength Ratings. None of XL Insurance (Bermuda), XL Re
and XL Re Europe will permit at any time its financial strength ratings to be
less than “A-” from A.M. Best & Co. (or its successor), except (i) as a
result of a merger permitted by Section 7.01 where the surviving corporation
has a financial strength rating not less than “A-” from A.M. Best & Co. (or
its successor) or (ii) in the event that A.M. Best & Co (or its successor)
in its discretion ceases to rate such company.


                    SECTION
7.09. Private Act. No Account Party will become subject to a Private Act
other than the X.L. Insurance Company, Ltd. Act, 1989 and the XL Life Ltd
Amendment and Consolidation Act 2001.


ARTICLE VIII


EVENTS OF DEFAULT 


	
  

 	
  

 
	
  

 	
           If
 any of the following events (“Events of Default”) shall occur:

 
	
  

 	
  

 
	
  

 	
           (a)
 any Account Party shall fail to pay any principal of any Loan or any
 reimbursement obligation in respect of any LC Disbursement when and as the
 same shall become due and payable, whether at the due date thereof or at a
 date fixed for prepayment thereof or otherwise;

 
	
  

 	
  

 
	
  

 	
           (b)
 any Account Party shall fail to pay any interest on any Loan or LC
 Disbursement or any fee payable under this Agreement or any other amount
 (other than an amount referred to in clause (a) of this Article) payable
 under this Agreement, when and as the same shall become due and payable, and
 such failure shall continue unremedied for a period of 5 or more days;

 


73









	
  

 	
  

 
	
  

 	
           (c)
 any representation or warranty made or deemed made by any Account Party in or
 in connection with this Agreement or any amendment or modification hereof, or
 in any certificate or financial statement furnished pursuant to the
 provisions hereof, shall prove to have been false or misleading in any
 material respect as of the time made (or deemed made) or furnished;

 
	
  

 	
  

 
	
  

 	
           (d)
 any Account Party shall fail to observe or perform any covenant, condition or
 agreement contained in Section 6.03 (with respect to an Account Party) or
 Article VII;

 
	
  

 	
  

 
	
  

 	
           (e)
 any Obligor shall fail to observe or perform any covenant, condition or
 agreement contained in this Agreement (other than those specified in
 clause (a), (b) or (d) of this Article or the reporting requirement
 pursuant to Section 6.01(f)), and such failure shall continue unremedied for
 a period of 30 or more days after notice thereof from the Administrative
 Agent (given at the request of any Lender) to such Obligor;

 
	
  

 	
  

 
	
  

 	
           (f)
 any Account Party or any of its Subsidiaries shall default (i) in any
 payment of principal of or interest on any other obligation for borrowed
 money in principal amount of $50,000,000 or more, or any payment of any
 principal amount of $50,000,000 or more under Hedging Agreements, in each
 case beyond any period of grace provided with respect thereto, or
 (ii) in the performance of any other agreement, term or condition
 contained in any such agreement (other than Hedging Agreements) under which
 any such obligation in principal amount of $50,000,000 or more is created, if
 the effect of such default is to cause or permit the holder or holders of
 such obligation (or trustee on behalf of such holder or holders) to cause
 such obligation to become due prior to its stated maturity or to terminate
 its commitment under such agreement, provided that this clause (f)
 shall not apply to secured Indebtedness that becomes due as a result of the
 voluntary sale or transfer of the property or assets securing such
 Indebtedness;

 
	
  

 	
  

 
	
  

 	
           (g)
 a decree or order by a court having jurisdiction in the premises shall have
 been entered adjudging any Account Party a bankrupt or insolvent, or
 approving as properly filed a petition seeking reorganization of such Account
 Party under the Bermuda Companies Law or the Companies Law (2011 Revision) of
 the Cayman Islands or any other similar applicable Law, and such decree or
 order shall have continued undischarged or unstayed for a period of 60 days;
 or a decree or order of a court having jurisdiction in the premises for the
 appointment of an examiner, receiver or liquidator or trustee or assignee in
 bankruptcy or insolvency of such Account Party or a substantial part of its
 property, or for the winding up or liquidation of its affairs, shall have
 been entered, and such decree or order shall have continued undischarged and
 unstayed for a period of 60 days;

 
	
  

 	
  

 
	
  

 	
           (h)
 any Account Party shall institute proceedings to be adjudicated a voluntary
 bankrupt, or shall consent to the filing of a bankruptcy proceeding against
 it, or shall file a petition or answer or consent seeking reorganization
 under the Bermuda Companies Law or the Companies Law (2011 Revision) of the
 Cayman Islands or any other similar applicable Law, or shall consent to the
 filing of any such petition, or shall consent to the appointment of an
 examiner, receiver or liquidator or trustee or assignee in bankruptcy or
 insolvency of it or a substantial part of its property, or shall make an
 assignment for the 

 


74









	
  

 	
  

 
	
  

 	
 benefit of
 creditors, or shall admit in writing its inability to pay its debts generally
 as they become due, or corporate or other action shall be taken by such
 Account Party in furtherance of any of the aforesaid purposes;

 
	
  

 	
  

 
	
  

 	
           (i)
 one or more judgments for the payment of money in an aggregate amount in excess
 of $100,000,000 shall be rendered against any Account Party or any of its
 Subsidiaries or any combination thereof and the same shall not have been
 vacated, discharged, stayed (whether by appeal or otherwise) or bonded
 pending appeal within 90 days from the entry thereof;

 
	
  

 	
  

 
	
  

 	
           (j)
 an ERISA Event (or similar event with respect to any Non-U.S. Benefit Plan)
 shall have occurred that, in the opinion of the Required Lenders, when taken
 together with all other ERISA Events and such similar events that have
 occurred, could reasonably be expected to result in liability of the Account
 Parties and their Subsidiaries in an aggregate amount exceeding $100,000,000;

 
	
  

 	
  

 
	
  

 	
           (k)
 a Change in Control shall occur;

 
	
  

 	
  

 
	
  

 	
           (l)
 XL Group shall cease to own, beneficially and of record, directly or
 indirectly, all of the outstanding voting shares of capital stock of XLIT, XL
 Switzerland, XL Re Europe, XL Insurance (Bermuda), XL Insurance, XL Re or XL
 America; or

 
	
  

 	
  

 
	
  

 	
           (m)
 the guarantee contained in Article III shall terminate or cease, in whole or
 material part, to be a legally valid and binding obligation of each Guarantor
 (other than as a result of a Disposition of a Guarantor under Section
 7.02(e)) or any Guarantor or any Person acting for or on behalf of any of
 such parties shall contest such validity or binding nature of such guarantee
 itself or the Transactions, or any such Person shall assert any of the
 foregoing;

 



then, and in
every such event (other than an event with respect to any Account Party
described in clause (g) or (h) of this Article), and at any time
thereafter during the continuance of such event, the Administrative Agent may,
and at the request of the Required Lenders shall, by notice to the Account
Parties, take either or both of the following actions, at the same or different
times:


          (i)
declare the commitment of the Administrative Agent and each Issuing Lender to
issue, amend, extend or otherwise modify any Letter of Credit to be terminated,
whereupon such commitments and obligation shall be terminated;


          (ii)
declare the Loans then outstanding to be due and payable in whole (or in part,
in which case any principal not so declared to be due and payable may
thereafter be declared to be due and payable), and thereupon the principal of
the Loans so declared to be due and payable, together with accrued interest
thereon and 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
the Account Parties; and in case of any event with respect to any Account Party
described in clause (g) or (h) of this Article, the Commitments shall
automatically terminate and the principal of the Loans then outstanding,
together with accrued interest thereon and all fees and other obligations of
the Account Parties 


75





accrued
hereunder, shall automatically become due and payable, without presentment,
demand, protest or other notice of any kind, all of which are hereby waived by
the Account Parties.


                    If
either (i) an Event of Default shall occur and be continuing or (ii) the
Commitment Termination Date has occurred, and XL Group receives notice from the
Administrative Agent or the Required Lenders demanding the deposit of cash
collateral for the Aggregate LC Exposure of all the Lenders pursuant to this
paragraph, each Specified Account Party shall immediately deposit into one or
more accounts (collectively, the “LC Collateral Accounts”) established
and maintained on the books and records of the Administrative Agent, which
account may be a “securities account” (within the meaning of Section 8-501
of the Uniform Commercial Code as in effect in the State of New York (the “Uniform
Commercial Code”)), in the name of the Administrative Agent and for the
benefit of the Lenders, an amount in cash equal to the total LC Exposure as of
such date in respect of outstanding Letters of Credit issued for the account of
such Specified Account Party plus any accrued and unpaid interest
thereon; provided that the obligation to deposit such cash collateral
shall become effective immediately, and such deposit shall become immediately
due and payable, without demand or other notice of any kind, upon the
occurrence of any Event of Default with respect to any Account Party described
in clause (g) or (h) of this Article. Such deposit shall be held by
the Administrative Agent as collateral for such LC Exposure under this
Agreement, and for this purpose each such Specified Account Party hereby grants
a security interest to the Administrative Agent for the benefit of the Lenders
in each (if any) of its LC Collateral Accounts and in any financial assets (as
defined in the Uniform Commercial Code) or other property held therein.


                    In
addition to the provisions of this Article, each Specified Account Party with
respect to an Alternative Currency Letter of Credit agrees that upon either (i)
the occurrence and during the continuance of any Event of Default or (ii) the
occurrence of Commitment Termination Date, any Lender which has issued any
Alternative Currency Letter of Credit may, by notice to XL Group and the
Administrative Agent: (a) in the case of clause (i) above only, declare
that all fees and other obligations of such Specified Account Party accrued in
respect of Alternative Currency Letters of Credit issued by such Lender shall
become due and payable immediately, without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by such Specified
Account Party and (b) demand the deposit (without duplication of any
amounts deposited with the Administrative Agent under the preceding paragraph)
of cash collateral from such Specified Account Party in immediately available
funds in the currency of such Alternative Currency Letter of Credit or, at the
option of such Lender, in Dollars in an amount equal to the then aggregate
undrawn face amount of all such Alternative Currency Letters of Credit and in
such manner as previously agreed to by such Specified Account Party and such
Lender (any account where any such amounts are deposited, an “Alternative
Currency Collateral Account” and together with the LC Collateral Accounts,
the “Collateral Accounts”); provided that, in the case of any of
the Events of Default specified in clause (g) or (h) of this Article,
without any notice to any Account Party or any other act by the Administrative
Agent or the Lenders, all fees and other obligations of the respective Specified
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
such Specified Account Party. If the Administrative Agent receives any notice
from a Lender pursuant to the previous sentence, then it will promptly give
notice thereof to the other 


76





Lenders.


                    To
the extent that any Letter of Credit referred to in the preceding two
paragraphs expires or otherwise terminates, and to the extent the applicable
Issuing Lender’s liability has ceased to exist under such Letter of Credit, and
funds are on deposit in the Collateral Account in respect of such Letter of
Credit, an amount equal to the undrawn amounts under such Letter of Credit
shall be promptly returned from such Collateral Account to the respective
Specified Account Party. In the case of any cash collateral provided during the
continuance of an Event of Default, if no Event of Default has occurred and is
continuing, the balance, if any, in the Collateral Accounts shall be promptly
returned to the respective Specified Account Parties. If, in accordance with
this paragraph, the balance in the Collateral Accounts has not been otherwise
returned, then after all such Letters of Credit shall have expired or been
fully drawn upon and all other obligations of the Specified Account Parties
hereunder shall have been paid in full, the balance, if any, in the Collateral
Accounts shall be promptly returned to the respective Specified Account
Parties.


ARTICLE IX


THE ADMINISTRATIVE AGENT 


                    Each
of the Lenders hereby irrevocably appoints the Administrative Agent as its
agent and authorizes the Administrative Agent to take such actions on its
behalf and to exercise such powers as are delegated to the Administrative Agent
by the terms hereof and under the other Credit Documents together with such
actions and powers as are reasonably incidental thereto.


                    The
Person serving as the Administrative Agent hereunder shall have the same rights
and powers in its capacity as a Lender as any other Lender and may exercise the
same as though it were not the Administrative Agent, and such Person and its
Affiliates may accept deposits from, lend money to and generally engage in any
kind of business with any Account Party or any Subsidiary or other Affiliate
thereof as if it were not the Administrative Agent hereunder.


                    The
Administrative Agent shall not have any duties or obligations except those
expressly set forth herein. Without limiting the generality of the foregoing,
(a) the Administrative Agent shall not be subject to any fiduciary or
other implied duties, regardless of whether a Default has occurred and is
continuing, (b) the Administrative Agent shall not have any duty to take
any discretionary action or exercise any discretionary powers, except
discretionary rights and powers expressly contemplated hereby that the
Administrative Agent is required to exercise in writing by the Required
Lenders, and (c) except as expressly set forth herein, the Administrative
Agent shall not have any duty to disclose, and shall not be liable for the
failure to disclose, any information relating to any Account Party or any of
their Subsidiaries that is communicated to or obtained by the bank serving as
Administrative Agent or any of its Affiliates in any capacity. The
Administrative Agent shall not be liable for any action taken or not taken by
it with the consent or at the request of the Required Lenders or 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 


77





Administrative
Agent by an Account Party or a Lender, and the Administrative Agent shall not
be responsible for or have any duty to ascertain or inquire into (i) any
statement, warranty or representation made in or in connection with this
Agreement, (ii) the contents of any certificate, report or other document
delivered hereunder or in connection herewith, (iii) the performance or
observance of any of the covenants, agreements or other terms or conditions set
forth herein, (iv) the validity, enforceability, effectiveness or
genuineness of this Agreement or any other agreement, instrument or document,
or (v) the satisfaction of any condition set forth in Article V or
elsewhere herein, other than to confirm receipt of items expressly required to
be delivered to the Administrative Agent.


                    The
Administrative Agent shall be entitled to rely upon, and shall not incur any
liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing believed by it to be genuine
and to have been signed or sent by the proper Person. The Administrative Agent
also may rely upon any statement made to it orally or by telephone and believed
by it to be made by the proper Person, and shall not incur any liability for
relying thereon. The Administrative Agent may consult with legal counsel (who
may be counsel for any Account Party), independent accountants and other
experts selected by it, and shall not be liable for any action taken or not
taken by it in accordance with the advice of any such counsel, accountants or
experts.


                    The
Administrative Agent may perform any and all its duties and exercise its rights
and powers by or through any one or more sub-agents appointed by the
Administrative Agent. The Administrative Agent and any such sub-agent may
perform any and all its duties and exercise its rights and powers through their
respective Related Parties. The exculpatory provisions of the preceding
paragraphs shall apply to any such sub-agent and to the Related Parties of the
Administrative Agent and any such sub-agent, and shall apply to their
respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as Administrative Agent.


                    The
Administrative Agent may resign at any time by notifying the Lenders and the
Account Parties. Upon any such resignation, the Required Lenders shall have the
right, in consultation with XL Group, to appoint a successor. If no successor
shall have been so appointed by the Required Lenders and shall have accepted
such appointment within 30 days after the retiring Administrative Agent gives
notice of its resignation, then the retiring Administrative Agent’s resignation
shall nonetheless become effective and (1) the retiring Administrative
Agent shall be discharged from its duties and obligations hereunder and
(2) the Required Lenders shall perform the duties of the Administrative
Agent (and all payments and communications provided to be made by, to or through
the Administrative Agent shall instead be made by or to each Lender directly)
until such time as the Required Lenders appoint a successor agent as provided
for above in this paragraph. Upon the acceptance of its appointment as
Administrative Agent hereunder by a successor, such successor shall succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring (or retired) Administrative Agent and the retiring Administrative
Agent shall be discharged from its duties and obligations hereunder (if not
already discharged therefrom as provided above in this paragraph). The fees
payable by XL Group to a successor Administrative Agent shall be the same as
those payable to its predecessor unless otherwise agreed between XL Group and such
successor. After the Administrative Agent’s resignation hereunder, the
provisions of this Article and Section 10.03 


78





shall continue
in effect for its benefit in respect of any actions taken or omitted to be
taken by it while it was acting as Administrative Agent.


                    Each
Lender acknowledges that it has, independently and without reliance upon the
Administrative Agent or any other Lender 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 Lender also acknowledges that it
will, independently and without reliance upon the Administrative Agent or any
other Lender and based on such documents and information as it shall from time
to time deem appropriate, continue to make its own decisions in taking or not
taking action under or based upon this Agreement, any related agreement or any
document furnished hereunder or thereunder.


                    Notwithstanding
anything herein to the contrary, the Joint Lead Arrangers and Joint
Bookrunners, the Syndication Agents and the Documentation Agents named on the
cover page of this Agreement shall not have any duties or liabilities under
this Agreement, except in their capacity, if any, as Lenders.


ARTICLE X


MISCELLANEOUS


                    SECTION
10.01. Notices. Except in the case of notices and other communications
expressly permitted to be given by telephone, all notices and other
communications provided for herein shall be in writing and shall be delivered
by hand or overnight courier service, mailed by certified or registered mail or
sent by telecopy or email, as follows:


	
  

 	
  

 
	
  

 	
           (a)
 if to any Account Party, to XL Group, One Bermudiana Road, Hamilton HM 08
 Bermuda, Attention of Timothy Goodyer (email address
 Timothy.Goodyer@xlgroup.com); with a copy to Kirstin R. Gould, Esq. at
 the same address and email address Kirstin.Gould@xlgroup.com;

 
	
  

 	
  

 
	
  

 	
           (b)
 if to the Administrative Agent, JPMorgan Chase Bank, N.A., 1111 Fannin
 Street, 10th Floor, Houston, Texas 77002-6925, Attention of Vashni X.
 Whittaker (Telecopy No. (713) 750-2223; Telephone No. (713) 483-1080);
 email address, vashni.x.whittaker@jpmorgan.com;

 
	
  

 	
  

 
	
  

 	
           with
 a copy to

 
	
  

 	
  

 
	
  

 	
           JPMorgan
 Chase Bank, N.A., 277 Park Avenue, 11th Floor, New York, New York 10172,
 Attention of Brij S Grewal (Telecopy No. (917) 456-3256; email address
 brijendra.s.grewal@jpmorgan.com; Telephone No. (212) 270-5305); and

 
	
  

 	
  

 
	
  

 	
           (c)
 if to a Lender, to it at its address (or telecopy number or email address)
 set forth in its Administrative Questionnaire (a copy of which such
 Administrative Questionnaire shall be delivered to XL Group).

 


79





Any party
hereto may change its address, telecopy number or email address for notices and
other communications hereunder by notice to the other parties hereto (or, in
the case of any such change by a Lender, by notice to the Account Parties and
the Administrative Agent). All notices and other communications given to any
party hereto in accordance with the provisions of this Agreement shall be
deemed to have been given on the date of receipt.


                    Notices
and other communications to the Lenders hereunder may be delivered or furnished
by electronic communications pursuant to procedures approved by the
Administrative Agent; provided that the foregoing shall not apply to
notices pursuant to Article II unless otherwise agreed by the Administrative
Agent and the applicable Lender. The Administrative Agent or any Account Party
may, in its discretion, agree to accept notices and other communications to it
hereunder by electronic communications pursuant to procedures approved by it; provided
that approval of such procedures may be limited to particular notices or
communications. Without limiting the foregoing, the Account Parties may furnish
to the Administrative Agent and the Lenders the financial statements required
to be furnished by it pursuant to Section 6.01(a), 6.01(b) or 6.01(c) by
electronic communications pursuant to procedures approved by the Administrative
Agent.


                    SECTION
10.02. Waivers; Amendments.


                    (a)
No Deemed Waivers; Remedies Cumulative. No failure or delay by the
Administrative Agent or any Lender in exercising any right or power hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such right or power, or any abandonment or discontinuance of steps to
enforce such a right or power, preclude any other or further exercise thereof
or the exercise of any other right or power. The rights and remedies of the
Administrative Agent, and the Lenders hereunder are cumulative and are not
exclusive of any rights or remedies that they would otherwise have. No waiver
of any provision of this Agreement or consent to any departure by the Account
Parties therefrom shall in any event be effective unless the same shall be
permitted by paragraph (b) of this Section, and then such waiver or
consent shall be effective only in the specific instance and for the purpose
for which given. Without limiting the generality of the foregoing, the making
of a Loan or issuance of a Letter of Credit shall not be construed as a waiver
of any Default, regardless of whether the Administrative Agent or any Lender
may have had notice or knowledge of such Default at the time.


                    (b)
Amendments. Neither this Agreement nor any provision hereof may be
waived, amended or modified except in writing signed by the Obligors and the
Required Lenders or by the Obligors and the Administrative Agent with the
consent of the Required Lenders; provided that no such writing shall:


	
  

 	
  

 
	
  

 	
           (i)
 increase the Commitment of any Lender without the written consent of such
 Lender,

 
	
  

 	
  

 
	
  

 	
           (ii)
 reduce the principal amount of any Loan or the amount of any reimbursement
 obligation of an Account Party in respect of any LC Disbursement or reduce
 the rate of interest thereon, or reduce any fees or other amounts payable
 hereunder, without the written consent of each Lender directly affected
 thereby,

 


80









	
  

 	
  

 
	
  

 	
           (iii)
 postpone the scheduled date of payment of the principal amount of any Loan or
 for reimbursement of any LC Disbursement, or any interest thereon, or any
 fees payable hereunder, or reduce the amount of, waive or excuse any such
 payment, or postpone the scheduled date of expiration of any Commitment or
 any Letter of Credit (other than an extension thereof pursuant to an
 “evergreen” provision” to the extent permitted hereunder), without the
 written consent of each Lender directly affected thereby,

 
	
  

 	
  

 
	
  

 	
           (iv)
 change Section 2.20(c) or 2.20(d) without the consent of each Lender
 directly affected thereby,

 
	
  

 	
  

 
	
  

 	
           (v) release
 any of the Guarantors from any of their guarantee obligations under
 Article III (other than as a result of a Disposition of a Guarantor
 under Section 7.02(e)) without the written consent of each Lender, and

 
	
  

 	
  

 
	
  

 	
           (vi)
 change any of the provisions of this Section or the percentage in the
 definition of the term “Required Lenders” or any other provision hereof
 specifying the number or percentage of Lenders required to waive, amend or
 modify any rights hereunder or make any determination or grant any consent
 hereunder, without the written consent of each Lender;

 



and provided
further that no such writing shall amend, modify or otherwise affect the
rights or duties of the Administrative Agent or an Issuing Lender hereunder
without the prior written consent of the Administrative Agent or such Issuing
Lender, as applicable.


          Notwithstanding
the foregoing, this Agreement may be amended (or amended and restated) with the
written consent of the Required Lenders, the Administrative Agent and each
Account Party (a) to increase the aggregate amount of Commitments under this
Agreement (it being understood, for the avoidance of doubt, that the Commitment
of any individual Lender may not be increased without the consent of such
Lender), (b) to add one or more additional credit facilities to this Agreement
and to permit the extensions of credit from time to time outstanding thereunder
and the accrued interest and fees in respect thereof to share ratably in the
benefits of this Agreement and the other Credit Documents with the Letters of
Credit, Loans and the accrued interest and fees in respect thereof and (c) to
include appropriately the financial institutions holding such credit facilities
in any determination of the Required Lenders; provided that this paragraph
shall not apply to any increases to Commitments pursuant to Section 2.11(c).


                    SECTION
10.03. Expenses; Indemnity; Damage Waiver.


                    (a)
Costs and Expenses. XL Group agrees to pay (i) all reasonable
out-of-pocket expenses incurred by the Administrative Agent and its Affiliates,
including the reasonable fees, charges and disbursements of counsel for the
Administrative Agent, in connection with the syndication of the credit
facilities provided for herein, the preparation and administration of this
Agreement or any amendments, modifications or waivers of the provisions hereof
(whether or not the transactions contemplated hereby or thereby shall be
consummated), and (ii) all reasonable out-of-pocket expenses incurred by
the Administrative Agent or any Lender, including the fees, charges and
disbursements of one legal counsel for the Administrative Agent


81





and one legal
counsel for the Lenders and, if necessary, one firm of local counsel in each
appropriate jurisdiction outside of the United States, in connection with the
enforcement or protection of its rights in connection with this Agreement,
including its rights under this Section, or in connection with the Loans made
or Letters of Credit issued hereunder, including in connection with any
workout, restructuring or negotiations in respect thereof.


                    (b)
Indemnification by the Account Parties. XL Group, and to the extent this
Section 10.03(b) applies to any Letter of Credit issued on behalf of any
Account Party or any Loan made to any Account Party, such Account Party,
jointly and severally with XL Group, agree to indemnify the Administrative
Agent, each Issuing Lender and each Lender, and each Related Party of any of
the foregoing Persons (each such Person being called an “Indemnitee”)
against, and to hold each Indemnitee harmless from, any and all losses, claims,
damages, liabilities and related expenses, including the fees, charges and
disbursements of any counsel for any Indemnitee (but not including Excluded
Taxes), incurred by or asserted against any Indemnitee arising out of, in
connection with, or as a result of (i) the execution or delivery of this
Agreement or any agreement or instrument contemplated hereby, the performance
by the parties hereto of their respective obligations hereunder or the
consummation of the Transactions or any other transactions contemplated hereby,
(ii) any Loan or the use of the proceeds thereof or any Letter of Credit
or the use thereof (including any refusal by any Lender to honor a demand for
payment under a Letter of Credit if the documents presented in connection with
such demand do not strictly comply with the terms of such Letter of Credit),
(iii) any actual or alleged presence or release of Hazardous Materials on
or from any property owned or operated by such Account Party or any of its
Subsidiaries, or any Environmental Liability related in any way to such Account
Party or any of its Subsidiaries, or (iv) any actual or prospective claim,
litigation, investigation or proceeding relating to any of the foregoing,
whether based on contract, tort or any other theory and regardless of whether
any Indemnitee is a party thereto; provided that such indemnity shall
not, as to any Indemnitee, be available to the extent that such losses, claims,
damages, liabilities or related expenses result from or arise out of the gross
negligence or willful misconduct of such Indemnitee, in each case, as
determined in a final non-appealable judgment by a court of competent
jurisdiction.


                    (c)
Reimbursement by Lenders. To the extent that the Account Parties fail to
pay any amount required to be paid by them to the Administrative Agent under
paragraph (a) or (b) of this Section, each Lender severally agrees to
pay to the Administrative Agent such Lender’s Applicable Percentage (determined
as of the time that the applicable unreimbursed expense or indemnity payment is
sought) of such unpaid amount; provided that the unreimbursed expense or
indemnified loss, claim, damage, liability or related expense, as the case may
be, was incurred by or asserted against the Administrative Agent in its
capacity as such.


                    (d)
Waiver of Consequential Damages, Etc. To the extent permitted by
applicable law, no Account Party shall assert, and each Account Party hereby
waives, any claim against any Indemnitee, on any theory of liability, for
special, indirect, consequential or punitive damages (as opposed to direct or
actual damages) arising out of, in connection with, or as a result of, this
Agreement or any agreement or instrument contemplated hereby, the Transactions,
any Loan or Letter of Credit or the use of the proceeds thereof.


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                    (e)
Payments. All amounts due under this Section shall be payable promptly
after written demand therefor.


                    SECTION
10.04. Successors and Assigns.


                    (a)
Assignments Generally. The provisions of this Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns permitted hereby, except that (i) no Account Party may
assign or otherwise transfer any of its rights or obligations hereunder without
the prior written consent of each Lender (and any attempted assignment or
transfer by an Account Party without such consent shall be null and void) and
(ii) no Lender may assign or otherwise transfer its rights or obligations
hereunder except in accordance with this Section. Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby,
Participants (to the extent provided in paragraph (c) of this Section) and, to
the extent expressly contemplated hereby, the Related Parties of each of the
Administrative Agent and the Lenders) any legal or equitable right, remedy or
claim under or by reason of this Agreement.


                    (b)
Assignments by Lenders. (i) Subject to the conditions set forth in
paragraph (b)(ii) of this Section, any Lender may assign all or a portion of
its rights and obligations under this Agreement (including all or a portion of
its Commitment and the Loans and LC Disbursements at the time owing to it) to
one or more NAIC Approved Banks (or to any other Person whose obligations in
respect of Letters of Credit shall be confirmed by a NAIC Approved Bank) with
the prior written consent (such consent not to be unreasonably withheld) of:


	
  

 	
  

 
	
  

 	
                     (A)
 the Account Parties, provided that no consent of any Account Party
 shall be required for an assignment to a Lender, an Affiliate of a Lender or,
 if an Event of Default under clause (a), (b), (g) or (h) of Article VIII has
 occurred and is continuing, any other assignee; and provided further
 that the Account Parties shall be deemed to have consented to any such
 assignment unless any Account Party shall object thereto by written notice to
 the Administrative Agent within 10 Business Days after having received a
 written request for such consent;

 
	
  

 	
  

 
	
  

 	
                     (B)
 the Administrative Agent, provided that no consent of the
 Administrative Agent shall be required for an assignment to a Lender or an
 Affiliate of a Lender; and

 
	
  

 	
  

 
	
  

 	
                     (C) the
 Issuing Lender with respect to Participated Letters of Credit.

 
	
  

 	
  

 
	
  

 	
           (ii)
 Assignments shall be subject to the following additional conditions: 

 
	
  

 	
  

 
	
  

 	
                     (A)
 except in the case of an assignment to a Lender or an Affiliate of a Lender
 or an assignment of the entire remaining amount of the assigning Lender’s
 Commitment, the amount of the Commitment of the assigning Lender subject to
 each such assignment (determined as of the date the Assignment and Assumption
 with respect to such assignment is delivered to the Administrative Agent)
 shall not be less than $5,000,000 unless each of the Account Parties and the
 Administrative Agent otherwise 

 


83









	
  

 	
  

 
	
  

 	
 consent, provided
 that no such consent of the Account Parties shall be required if an Event of
 Default under clause (a), (b), (g) or (h) of Article VIII has occurred and is
 continuing;

 
	
  

 	
  

 
	
  

 	
                     (B)
 each partial assignment shall be made as an assignment of a proportionate
 part of all the assigning Lender’s rights and obligations under this
 Agreement;

 
	
  

 	
  

 
	
  

 	
                     (C)
 the parties to each assignment shall execute and deliver to the
 Administrative Agent an Assignment and Assumption, together with a processing
 and recordation fee of $3,500; and

 
	
  

 	
  

 
	
  

 	
                     (D) the
 assignee, if it shall not be a Lender, shall deliver an Administrative
 Questionnaire to the Administrative Agent (with a copy to XL Group).

 



                    (iii)
Subject to acceptance and recording thereof pursuant to paragraph (b)(v)
of this Section, from and after the effective date specified in each Assignment
and Assumption, the assignee thereunder shall be a party hereto and, to the
extent of the interest assigned by such Assignment and Assumption, have the
rights and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Assumption, be released from its obligations under this
Agreement (and, in the case of an Assignment and Assumption covering all of the
assigning Lender’s rights and obligations under this Agreement, such Lender
shall cease to be a party hereto but shall continue to be entitled to the benefits
and subject to the limitations of Sections 2.17, 2.18, 2.19 and 10.03).
Any assignment or transfer by a Lender of rights or obligations under this
Agreement that does not comply with this Section 10.04 shall be treated for
purposes of this Agreement as a sale by such Lender of a participation in such
rights and obligations in accordance with paragraph (c) of this Section.


                    (iv)
Notwithstanding anything to the contrary contained herein, any Lender (a “Granting
Lender”) may grant to a special purpose vehicle (an “SPV”) of such
Granting Lender, identified as such in writing from time to time by the
Granting Lender to the Administrative Agent and the Account Parties, the option
to provide to the Account Parties all or any part of any Loan or LC
Disbursement that such Granting Lender would otherwise be obligated to make to
the Account Parties pursuant to Section 2.01, provided that
(i) nothing herein shall constitute a commitment by any SPV to make any
Loan or LC Disbursement, (ii) if an SPV elects not to exercise such option
or otherwise fails to provide all or any part of such Loan or LC Disbursement,
the Granting Lender shall be obligated to make such Loan or LC Disbursement
pursuant to the terms hereof and shall in any case remain responsible to the
other parties for the performance of its obligations under the terms of this
Agreement and shall remain the Lender for all purposes hereunder (including,
without limitation, with respect to the rights and responsibilities to deliver
all consents and waivers required or requested under this Agreement with
respect to its SPV) and (iii) the Account Parties may bring any proceeding
against either or both the Granting Lender or the SPV in order to enforce any
rights of the Account Parties hereunder. The making of a Loan or LC
Disbursement by an SPV hereunder shall utilize the Commitment of the Granting
Lender to the same extent, and as if, such Loan or LC 


84





Disbursement
were made by the Granting Lender. Each party hereto hereby agrees that no SPV
shall be liable for any payment under this Agreement for which a Lender would
otherwise be liable, for so long as, and to the extent, the related Granting
Lender makes such payment. In furtherance of the foregoing, each party hereto
hereby agrees (which agreement shall survive the termination of this Agreement)
that, prior to the date that is one year and one day after the payment in full
of all outstanding commercial paper or other senior indebtedness of any SPV, it
will not institute against, or join any other person in instituting against,
such SPV any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings or similar proceedings under the laws of the United States or any
State thereof arising out of any claim against such SPV under this Agreement.
In addition, notwithstanding anything to the contrary contained in this
Section, any SPV may with notice to, but without the prior written consent of,
the Account Parties or the Administrative Agent and without paying any
processing fee therefor, assign all or a portion of its interests in any Loan
or Letter of Credit to its Granting Lender or to any financial institutions
(consented to by the Account Parties and the Administrative Agent) providing
liquidity and/or credit support (if any) with respect to commercial paper
issued by such SPV to fund such Loans and to issue such Letters of Credit and
such SPV may disclose, on a confidential basis, confidential information with
respect to any Account Party and its Subsidiaries to any rating agency,
commercial paper dealer or provider of a surety, guarantee or credit liquidity
enhancement to such SPV. Notwithstanding anything to the contrary in this
Agreement, no SPV shall be entitled to any greater rights under Section 2.17 or
Section 2.19 than its Granting Lender would have been entitled to absent the
use of such SPV. This paragraph may not be amended without the consent of any
SPV at the time holding Loans or LC Disbursements under this Agreement.


                    (v)
The Administrative Agent, acting for this purpose as an agent of the Account
Parties, shall maintain at one of its offices in New York City a copy of each
Assignment and Assumption delivered to it and a register for the recordation of
the names and addresses of the Lenders, the Commitment of, and principal amount
of the Loans and LC Disbursements owing to, each Lender pursuant to the terms
hereof from time to time (the “Register”). The entries in the Register
shall be conclusive, absent manifest error, and the Account Parties, the
Administrative Agent and the Lenders shall treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder for
all purposes of this Agreement, notwithstanding notice to the contrary. The
Register shall be available for inspection by any Account Party and any Lender,
at any reasonable time and from time to time upon reasonable prior notice.


                    (vi)
Upon its receipt of a duly completed Assignment and Assumption executed by an
assigning Lender and an assignee, the assignee’s completed Administrative
Questionnaire (unless the assignee shall already be a Lender hereunder), the
processing and recordation fee referred to in paragraph (b)(ii)(C) of this
Section and any written consent to such assignment required by paragraph (b)(i)
of this Section, the Administrative Agent shall accept such Assignment and
Assumption and record the information contained therein in the Register. No
assignment shall be effective for purposes of this Agreement unless it has been
recorded in the Register as provided in this paragraph.


                    (c)
Participations. (i) Any Lender may, without the consent of the Account 


85





Parties, the
Administrative Agent or any Issuing Lender, sell participations to one or more
banks or other entities (a “Participant”) in all or a portion of such
Lender’s rights and obligations under this Agreement and the other Credit
Documents (including all or a portion of its Commitment, the Loans and the LC
Disbursements owing to it); provided that (A) any such
participation sold to a Participant which is not a Lender or a Federal Reserve
Bank shall be made only with the consent (which in each case shall not be
unreasonably withheld) of XL Group and the Administrative Agent, unless a Default
has occurred and is continuing, in which case the consent of XL Group shall not
be required, (B) such Lender’s obligations under this Agreement and the other
Credit Documents shall remain unchanged, (C) such Lender shall remain
solely responsible to the other parties hereto for the performance of such
obligations and (D) the Account Parties, the Administrative Agent and the
other Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender’s rights and obligations under this Agreement and
the other Credit Documents. Any agreement or instrument pursuant to which a
Lender sells such a participation shall provide that such Lender shall retain
the sole right to enforce this Agreement and the other Credit Documents and to
approve any amendment, modification or waiver of any provision of this
Agreement or the other Credit Documents; provided that such agreement or
instrument may provide that such Lender will not, without the consent of the
Participant, agree to any amendment, modification or waiver described in the
first proviso to Section 10.02(b) that affects such Participant. Subject to
paragraph (c)(ii) of this Section, the Account Parties agree that each
Participant shall be entitled to the benefits and subject to the limitations of
Sections 2.17 and 2.19 (subject to the requirements of such Sections) to the
same extent as if it were a Lender and had acquired its interest by assignment
pursuant to paragraph (b) of this Section. To the extent permitted by law, each
Participant also shall be entitled to the benefits of Section 10.08 as
though it were a Lender, provided such Participant agrees to be subject to
Section 2.20(d) as though it were a Lender.


                    (ii)
A Participant shall not be entitled to receive any greater payment under
Section 2.17, 2.18 or 2.19 than the applicable Lender would have been entitled
to receive with respect to the participation sold to such Participant or the
Lender interest assigned, unless (A) the sale of the participation to such Participant
is made with the Account Parties’ prior written consent and (B) in the case of
Section 2.17 or 2.19, the entitlement to greater payment results solely from a
Change in Law formally announced after such Participant became a Participant.


                    (iii)
In the event that any Lender sells participations in a Loan or Commitment, such
Lender, acting solely for this purpose as a non-fiduciary agent of the XL
Group, shall maintain a register on which it enters the name of all
participants in the Loans and Commitments held by it (the “Participant
Register”); provided that no Lender shall have any obligation to disclose
all or any portion of the Participant Register to any Person (including the
identity of any Participant or any information relating to a Participant’s
interest in any Commitments, Letters of Credit or its other obligations under
this Agreement or any Credit Document) except to the extent that such
disclosure is necessary to establish that such Commitment, Letter of Credit or
other obligation is in registered form under Section 5f.103-1(c) of the United
States Treasury Regulations or otherwise required by applicable law. The
entries in the Participant Register shall be conclusive in the absence of
manifest error, and the participating Lender, each Account Party and the
Administrative Agent shall treat each Person whose name is recorded in the
Participant Register, pursuant to the terms hereof, as the Participant for all
purposes of this Agreement and 


86





the other
Credit Documents, notwithstanding any notice to the contrary.


                    (d)
Certain Pledges. Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement to secure
obligations of such Lender, including any such pledge or assignment to secure
obligations to a Federal Reserve Bank, and this Section shall not apply to any
such pledge or assignment of a security interest; provided that no such
pledge or assignment of a security interest shall release a Lender from any of
its obligations hereunder or substitute any such pledgee or assignee for such
Lender as a party hereto.


                    (e)
No Assignments to Account Parties or Affiliates. Anything in this
Section to the contrary notwithstanding, no Lender may assign or participate
any interest in any Loan or LC Exposure held by it hereunder to any Account
Party or any of its Affiliates or Subsidiaries without the prior consent of
each Lender.


                    SECTION
10.05. Survival. All covenants, agreements, representations and
warranties made by the Account Parties herein and in the certificates or other
instruments delivered in connection with or pursuant to this Agreement shall be
considered to have been relied upon by the other parties hereto and shall
survive the execution and delivery of this Agreement and the making of any
Loans and the issuance of any Letters of Credit, regardless of any
investigation made by any such other party or on its behalf and notwithstanding
that the Administrative Agent, or any Lender may have had notice or knowledge
of any Default or incorrect representation or warranty at the time any credit
is extended hereunder, and shall continue in full force and effect as long as
the principal of, or any accrued interest on, any Loan or any fee or any other
amount payable under this Agreement is outstanding and unpaid or any Letter of
Credit is outstanding and so long as the Commitments have not expired or
terminated. The provisions of Sections 2.17, 2.18, 2.19 and 10.03 and
Article IX shall survive and remain in full force and effect regardless of
the consummation of the transactions contemplated hereby, the repayment of the
Loans, the expiration or termination of the Letters of Credit and the
expiration or termination of the Commitments or the termination of this
Agreement or any provision hereof.


                    SECTION
10.06. Counterparts; Integration; Effectiveness. This Agreement may be
executed in counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all of which
when taken together shall constitute a single contract. This Agreement and any
separate letter agreements with respect to fees payable to the Administrative
Agent constitute the entire contract between and among the parties relating to
the subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof. Except
as provided in Section 5.01, this Agreement shall become effective when it
shall have been executed by the Administrative Agent and when the
Administrative Agent shall have received counterparts hereof which, when taken
together, bear the signatures of each of the other parties hereto, and
thereafter shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns. Delivery of an executed
counterpart of a signature page to this Agreement by telecopy or email shall be
effective as delivery of a manually executed counterpart of this Agreement.


                    SECTION
10.07. Severability. To the fullest extent permitted by law, any
provision of this Agreement held to be invalid, illegal or unenforceable in any
jurisdiction shall, 


87





as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof and the invalidity of a particular provision in
a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.


                    SECTION
10.08. Right of Setoff. If an Event of Default shall have occurred and
be continuing, each Lender and their Affiliates (collectively, solely for
purposes of this paragraph, the “Lenders”) are hereby authorized at any
time and from time to time, to the fullest extent permitted by law, to set off
and apply any and all deposits (general or special, time or demand, provisional
or final) at any time held and other indebtedness at any time owing by such
Lender to or for the credit or the account of any Account Party or Guarantor
against any of and all the obligations of such Account Party or Guarantor now
or hereafter existing under this Agreement held by such Lender, irrespective of
whether or not such Lender shall have made any demand under this Agreement and
although such obligations may be unmatured. The rights of each Lender under
this Section are in addition to other rights and remedies (including other
rights of setoff) which such Lender may have.


                    SECTION
10.09. Governing Law; Jurisdiction; Etc.


                    (a)
Governing Law. This Agreement shall be construed in accordance with and
governed by the law of the State of New York.


                    (b)
Submission to Jurisdiction. Each party hereto hereby irrevocably and
unconditionally submits, for itself and its property, to the exclusive
jurisdiction of the Supreme Court of the State of New York sitting in the
Borough of Manhattan in the City of New York and of the United States District
Court of the Southern District of New York, and any appellate court from any
thereof, in any action or proceeding arising out of or relating to this
Agreement, or for recognition or enforcement of any judgment, and each of the
parties hereto hereby irrevocably and unconditionally agrees that all claims in
respect of any such action or proceeding may be heard and determined in such
New York State or, to the extent permitted by law, in such Federal court. Each
of the parties hereto agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law. Nothing in this
Agreement shall affect any right that the Administrative Agent, or any Lender
may otherwise have to bring any action or proceeding relating to this Agreement
against any Obligor or its properties in the courts of any jurisdiction.


                    (c)
Waiver of Venue. Each party hereto hereby irrevocably and
unconditionally waives, to the fullest extent it may legally and effectively do
so, any objection which it may now or hereafter have to the laying of venue of
any suit, action or proceeding arising out of or relating to this Agreement in
any court referred to in paragraph (b) of this Section. Each of the
parties hereto hereby irrevocably waives, to the fullest extent permitted by
law, the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.


                    (d)
Service of Process. By the execution and delivery of this Agreement,
each Account Party and each Guarantor acknowledges that they have by a separate
written instrument, designated and appointed CT Corporation System, 111 Eighth
Avenue, 13th floor, New York, New York 10011 (or any successor
entity thereto), as its authorized agent upon which process


88





may be served
in any suit or proceeding arising out of or relating to this Agreement that may
be instituted in any federal or state court in the State of New York. Each
party to this Agreement irrevocably consents to service of process in the
manner provided for notices in Section 10.01. Nothing in this Agreement
will affect the right of any party to this Agreement to serve process in any
other manner permitted by law.


                    (e)
Waiver of Immunities. To the extent that any Account Party has or
hereafter may acquire any immunity from jurisdiction of any court or from any
legal process (whether through service of notice, attachment prior to judgment,
attachment in aid of execution or execution, on the ground of sovereignty or
otherwise) with respect to itself or its property, it hereby irrevocably
waives, to the fullest extent permitted by applicable law, such immunity in
respect of its obligations under this Agreement.


                    SECTION
10.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING
TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON
CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT
NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.


                      SECTION
10.11. Headings. Article and Section headings and the Table of Contents
used herein are for convenience of reference only, are not part of this
Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.


                    SECTION
10.12. Treatment of Certain Information; Confidentiality.


                    (a)
Treatment of Certain Information. Each of the Account Parties acknowledge
that from time to time financial advisory, investment banking and other
services may be offered or provided to any Account Party or one or more of
their Subsidiaries (in connection with this Agreement or otherwise) by any
Lender or by one or more subsidiaries or affiliates of such Lender and each of
the Account Parties hereby authorizes each Lender to share any information
delivered to such Lender by such Account Party and its Subsidiaries pursuant to
this Agreement, or in connection with the decision of such Lender to enter into
this Agreement, to any such subsidiary or affiliate, it being understood that
(i) any such information shall be used only for the purpose of advising the
Account Parties or preparing presentation materials for the benefit of the
Account Parties and (ii) any such subsidiary or affiliate receiving such
information shall be bound by the provisions of paragraph (b) of this
Section as if it were a Lender hereunder. The provisions of this paragraph and
paragraph (b) of this Section shall survive until the third anniversary of the
later of (i) the expiration or termination of the Commitments hereunder and
(ii) the termination of this Agreement.


89





                    (b)
Confidentiality. Each of the Administrative Agent, the Lenders and each
SPV agrees to maintain the confidentiality of the Information (as defined
below), except that Information may be disclosed (i) to its and its
Affiliates’ directors, officers, employees, partners and agents, including
accountants, legal counsel and other advisors (it being understood that the
Persons to whom such disclosure is made will be informed of the confidential
nature of such Information and instructed to keep such Information
confidential), (ii) to the extent requested by any regulatory authority
(including self-regulating organizations) having jurisdiction over the
Administrative Agent or any Lender (or any Affiliate thereof), (iii) to
the extent required by applicable laws or regulations or by any subpoena or
similar legal process, (iv) to any other party to this Agreement,
(v) in connection with the exercise of any remedies hereunder or any suit,
action or proceeding relating to this Agreement or the enforcement of rights
hereunder, (vi) subject to an agreement in writing containing provisions
substantially the same as those of this paragraph and for the benefit of the
Account Parties, to (a) any assignee of or Participant in, or any prospective
assignee of or Participant in, any of its rights or obligations under this
Agreement, (b) any actual or prospective counterparty (or its advisors) to any
swap or derivative transaction relating to any Account Party and its
obligations hereunder or (c) any credit insurance provider (or its advisors) in
relation to this Agreement, (vii) with the consent of the Account Parties
or (viii) to the extent such Information (A) becomes publicly
available other than as a result of a breach of this paragraph or
(B) becomes available to the Administrative Agent or any Lender on a
nonconfidential basis from a source other than an Account Party. For the
purposes of this paragraph, “Information” means all information received
from an Account Party relating to an Account Party or its business, other than
any such information that is available to the Administrative Agent or any
Lender on a nonconfidential basis prior to disclosure by such Account Party.
Any Person required to maintain the confidentiality of Information as provided
in this Section shall be considered to have complied with its obligation to do
so if such Person has exercised the same degree of care to maintain the
confidentiality of such Information as such Person would accord to its own
confidential information. Notwithstanding the foregoing, each of the
Administrative Agent, and the Lenders agree that they will not trade the
securities of any of the Account Parties based upon non-public Information that
is received by them.


                    SECTION
10.13. Judgment Currency. This is an international loan transaction in
which the obligations of each Account Party and the Guarantors under this
Agreement to make payment hereunder shall be satisfied only in Dollars and only
if such payment shall be made in New York City, and the obligations of each
Account Party and the Guarantors under this Agreement to make payment to (or
for account of) a Lender in Dollars shall not be discharged or satisfied by any
tender or recovery pursuant to any judgment expressed in or converted into any
other currency or in another place except to the extent that such tender or
recovery results in the effective receipt by such Lender in New York City of
the full amount of Dollars payable to such Lender under this Agreement. If for
the purpose of obtaining judgment in any court it is necessary to convert a sum
due hereunder in Dollars into another currency (in this Section called the “judgment
currency”), the rate of exchange that shall be applied shall be that at
which in accordance with normal banking procedures the Administrative Agent
could purchase such Dollars at the principal office of the Administrative Agent
in New York City with the judgment currency on the Business Day next preceding
the day on which such judgment is rendered. The obligation of each Account
Party and the Guarantors in respect of any such sum due from it to the Administrative
Agent or any Lender hereunder (in this Section called an “Entitled Person”)
shall, notwithstanding the rate of exchange actually applied in rendering such
judgment, be 


90





discharged
only to the extent that on the Business Day following receipt by such Entitled
Person of any sum adjudged to be due hereunder in the judgment currency such
Entitled Person may in accordance with normal banking procedures purchase and
transfer Dollars to New York City with the amount of the judgment currency so adjudged
to be due; and each Account Party and the Guarantors hereby, as a separate
obligation and notwithstanding any such judgment, agrees to indemnify such
Entitled Person against, and to pay such Entitled Person on demand, in Dollars,
the amount (if any) by which the sum originally due to such Entitled Person in
Dollars hereunder exceeds the amount of the Dollars so purchased and
transferred.


                    SECTION
10.14. USA PATRIOT Act. Each Lender and the Administrative Agent hereby
notifies the Account Parties that pursuant to the requirements of the USA
Patriot Act (Title III of Pub. L. 107-56 (signed into law
October 26, 2001)), such Lender and the Administrative Agent is
required to obtain, verify and record information that identifies the Account
Parties, which information includes the name and address of the Account Parties
and other information that will allow such Lender and the Administrative Agent
to identify each Account Party in accordance with said Act. Each Account Party
and each of its Subsidiaries shall provide such information and take such
actions as are reasonably requested by the Administrative Agent or any Lender
in order to assist the Administrative Agent and the Lenders in maintaining
compliance with the USA Patriot Act.


                    SECTION
10.15. NO FIDUCIARY DUTY. The Administrative Agent, each Lender and
their Affiliates (collectively, solely for purposes of this paragraph, the “Lenders”),
may have economic interests that conflict with those of the Obligors, their
stockholders and/or their affiliates. Each Obligor agrees that nothing in the
Credit Documents or otherwise pursuant to the Transactions will be deemed to
create a fiduciary relationship or fiduciary or other implied duty between any
Lender, on the one hand, and such Obligor, its stockholders or its affiliates,
on the other. The Obligors acknowledge and agree that (i) the transactions
contemplated by the Credit Documents are arm’s-length commercial transactions
between the Lenders, on the one hand, and the Obligors, on the other, and (ii)
in connection therewith and with the process leading thereto, (x) no Lender has
assumed a fiduciary responsibility in favor of any Obligor, its stockholders or
its affiliates with respect to the transactions contemplated hereby or the
process leading thereto (irrespective of whether any Lender has advised, is
currently advising or will advise any Obligor, its stockholders or its
Affiliates on other matters) or any other obligation to any Obligor except the
obligations expressly set forth in the Credit Documents and (y) each Lender is
acting solely as principal and not as the fiduciary of any Obligor, its
management, stockholders, creditors or any other Person. Each Obligor
acknowledges and agrees that it has consulted its own legal and financial
advisors to the extent it deemed appropriate and that it is responsible for
making its own independent judgment with respect to such transactions and the
process leading thereto. Each Obligor agrees that it will not claim that any
Lender owes a fiduciary or similar duty to such Obligor, in connection with
such transaction or the process leading thereto.


SECTION 10.16.
ILLEGALITY.


91





                    Notwithstanding
anything herein to the contrary, no Lender shall be required to make any Loan
or issue or fund any Letter of Credit for so long as such action is illegal and
any such Lender shall provide prompt written notice setting forth any such
illegality pursuant to this Section 10.16 to XL Group. For the purposes of this
Section 10.16, the provisions of Section 2.21(a) shall apply in the event of
any such illegality mutatis mutandis.


92






                    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.


	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Signed and
 Delivered as a Deed

 
	
  

 	
 for and on
 behalf of

 
	
  

 	
 XL GROUP
 PLC,

 
	
  

 	
 as an
 Account Party and a Guarantor

 
	
  

 	
 by its duly
 authorized attorney

 
	
  

 	
 in the
 presence of:

 
	
  

 	
  

 	
  

 
	
  

 	
 By 

 	
 /s/ Simon
 Rich

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
  

 	
 Name: Simon
 Rich

 	
  

 
	
  

 	
  

 	
 Title:
 Attorney 

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 /s/ Patricia
 Pacheco

 	
  

 
	
  

 	

 


 	
  

 
	
  

 	
 Witness

 	
  

 
	
  

 	
  

 	
 Name:
 Patricia Pacheco

 	
  

 
	
  

 	
  

 	
 Title:
 Executive Assistant

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 U.S. Federal
 Tax Identification No.: 98-0665416

 
	
  

 	
  

 
	
  

 	
 XLIT LTD., 

 	
  

 
	
  

 	
 as an
 Account Party and a Guarantor

 
	
  

 	
  

 
	
  

 	
 By

 	
 /s/ Simon
 Rich

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
  

 	
 Name: Simon
 Rich

 	
  

 
	
  

 	
  

 	
 Title:
 Attorney 

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 By

 	
 /s/ Robert
 Hawley

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
  

 	
 Name: Robert
 Hawley

 	
  

 
	
  

 	
  

 	
 Title:
 Authorized Officer

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 U.S. Federal
 Tax Identification No.: 98-0191089

 













	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 X.L.
 AMERICA, INC.,

 
	
  

 	
 as an
 Account Party and a Guarantor

 
	
  

 	
  

 	
  

 
	
  

 	
 By

 	
 /s/ Richard
 G. McCarty

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
  

 	
 Name:
 Richard G. McCarty

 	
  

 
	
  

 	
  

 	
 Title: 

 	
 Senior Vice
 President,

 
	
  

 	
  

 	
  

 	
 General
 Counsel & Secretary

 
	
  

 	
  

 	
  

 
	
  

 	
 U.S. Federal
 Tax Identification No.: 06-1516268

 
	
  

 	
  

 
	
  

 	
 XL INSURANCE
 (BERMUDA) LTD, 

 
	
  

 	
 as an
 Account Party and a Guarantor

 
	
  

 	
  

 
	
  

 	
 By

 	
 /s/ C.
 Stanley Lee

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
  

 	
 Name: C.
 Stanley Lee

 
	
  

 	
  

 	
 Title: Chief
 Financial Officer 

 
	
  

 	
  

 	
  

 
	
  

 	
 U.S. Federal
 Tax Identification No.: 98-0354869

 
	
  

 	
  

 
	
  

 	
 XL RE LTD, 

 
	
  

 	
 as an
 Account Party and a Guarantor

 
	
  

 	
  

 
	
  

 	
 By

 	
 /s/ Mark
 Twite

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
  

 	
 Name: Mark
 Twite

 
	
  

 	
  

 	
 Title:
 Senior Vice President and

 
	
  

 	
  

 	
           Chief
 Financial Officer

 
	
  

 	
  

 	
  

 
	
  

 	
 U.S. Federal
 Tax Identification No.: 98-0351953

 













	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Signed and
 Delivered as a Deed

 
	
  

 	
 for and on
 behalf of

 
	
  

 	
 XL RE EUROPE
 LIMITED,

 
	
  

 	
 as an
 Account Party 

 
	
  

 	
 by its duly
 authorized attorney

 
	
  

 	
 in the
 presence of:

 
	
  

 	
  

 
	
  

 	
 By 

 	
 /s/ David
 Watson

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
  

 	
 Name: David
 Watson

 
	
  

 	
  

 	
 Title: Attorney
 

 
	
  

 	
  

 	
  

 
	
  

 	
 /s/ Michele
 Mulready

 
	
  

 	

 


 	
  

 
	
  

 	
 Witness

 
	
  

 	
  

 	
 Name:
 Michele Mulready

 
	
  

 	
  

 	
 Title:
 Company Secretary

 	
  

 
	
  

 	
  

 	
  

 
	
  

 	
 U.S. Federal
 Tax Identification No.: 30-0479679

 
	
  

 	
  

 
	
  

 	
 XL INSURANCE
 COMPANY LIMITED,

 
	
  

 	
 as an
 Account Party 

 
	
  

 	
  

 	
  

 
	
  

 	
 By

 	
 /s/ Graham
 Lambourne

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
  

 	
 Name: Graham
 J. Lambourne

 
	
  

 	
  

 	
 Title:
 Director

 
	
  

 	
  

 	
  

 
	
  

 	
 U.S. Federal
 Tax Identification No.: 30-0479685

 













	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 
	
  

 	
 XL INSURANCE
 SWITZERLAND LTD,

 
	
  

 	
 as an
 Account Party 

 
	
  

 	
  

 
	
  

 	
 By 

 	
 /s/ Daniel
 Maurer

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
  

 	
 Name: Daniel
 Maurer 

 
	
  

 	
  

 	
 Title:
 Chairman

 
	
  

 	
  

 	
  

 
	
  

 	
 By

 	
 /s/ Bruno Länzlinger

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
  

 	
 Name: Bruno
 Länzlinger

 
	
  

 	
  

 	
 Title: CEO

 
	
  

 	
  

 	
  

 
	
  

 	
 U.S. Federal
 Tax Identification No.: 30-0479676

 
	
  

 	
  

 
	
  

 	
 XL LIFE LTD,

 
	
  

 	
 as an
 Account Party and a Guarantor 

 
	
  

 	
  

 
	
  

 	
 By

 	
 /s/ Simon
 Rich

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
  

 	
 Name: Simon
 Rich

 
	
  

 	
  

 	
 Title:
 Director

 
	
  

 	
  

 	
  

 
	
  

 	
 U.S. Federal
 Tax Identification No.: 98-0228561

 













	
  

 	
  

 	
  

 	
  

 
	
  

 	
 LENDERS

 
	
  

 	
  

 
	
  

 	
 JPMORGAN
 CHASE BANK, N.A.,

 
	
  

 	
 individually
 and as Administrative Agent

 
	
  

 	
  

 
	
  

 	
 By:

 	
  /s/ Melvin
 D. Jackson

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
 Name: Melvin D. Jackson

 
	
  

 	
 Title: Vice President

 
	
  

 	
  

 	
  

 
	
  

 	
 CITIBANK,
 N.A.,

 
	
  

 	
  

 
	
  

 	
 By:

 	
  /s/ Maureen
 P. Maroney

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
 Name: Maureen P. Maroney

 
	
  

 	
 Title: Vice President

 
	
  

 	
  

 	
  

 
	
  

 	
 THE ROYAL
 BANK OF SCOTLAND PLC

 
	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
  /s/ Joseph
 W. Lux

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
 Name: Joseph W. Lux

 
	
  

 	
 Title: Managing Director 

 












	
  

 	
  

 	
  

 	
  

 
	
  

 	
 MORGAN
 STANLEY BANK, N.A.,

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
  /s/ Michael
 King

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
 Name: Michael King

 
	
  

 	
 Title: Authorized Signatory

 
	
  

 	
  

 	
  

 
	
  

 	
 BARCLAYS
 BANK PLC,

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
  /s/ David
 Barton

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
 Name: David Barton

 
	
  

 	
 Title: Director

 
	
  

 	
  

 	
  

 
	
  

 	
 THE BANK OF
 NEW YORK MELLON,

 
	
  

 	
  

 
	
  

 	
 By:

 	
  /s/ Michael
 Pensari

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
 Name: Michael Pensari

 
	
  

 	
 Title: Managing Director

 
	
  

 	
  

 	
  

 
	
  

 	
 BANK OF
 AMERICA, N.A.,

 
	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
  /s/ Debra
 Basler

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
 Name: Debra Basler

 
	
  

 	
 Title: Managing Director

 
	
  

 	
  

 	
  

 
	
  

 	
 THE BANK OF
 TOKYO-MITSUBISHI UFJ, LTD.,

 
	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
  /s/ Rick
 Adler

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
 Name: Rick Adler

 
	
  

 	
 Title: Director

 













	
  

 	
  

 	
  

 	
  

 
	
  

 	
 CREDIT
 AGRICOLE CORPORATE & INVESTMENT BANK,

 
	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
  /s/ Charles
 Kornberger

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
 Name: Charles Kornberger

 
	
  

 	
 Title: Managing Director

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
  /s/ Frank
 Tatulli

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
 Name: Frank Tatulli

 
	
  

 	
 Title: Managing Director 

 
	
  

 	
  

 	
  

 
	
  

 	
 DEUTSCHE
 BANK AG NEW YORK BRANCH,

 
	
  

 	
  

 
	
  

 	
 By:

 	
  /s/ John S.
 McGill

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
 Name: John S. McGill

 
	
  

 	
 Title: Director

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
  /s/ Virginia
 Cosenza

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
 Name: Virginia Cosenza

 	
  

 
	
  

 	
 Title: Vice President

 
	
  

 	
  

 	
  

 
	
  

 	
 GOLDMAN
 SACHS BANK USA,

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
  /s/ Mark
 Walton

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
 Name: Mark Walton

 
	
  

 	
 Title: Authorized Signatory

 
	
  

 	
  

 	
  

 
	
  

 	
 HSBC BANK
 USA, NATIONAL ASSOCIATION

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
  /s/ Jody
 Feldman

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
 Name: Jody Feldman

 
	
  

 	
 Title: Vice President

 














	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 LLOYDS TSB
 BANK PLC,

 
	
  

 	
  

 
	
  

 	
 By: 

 	
 /s/ Julia R
 Franklin

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
 Name: Julia R Franklin

 
	
  

 	
 Title: Vice President

 
	
  

 	
  

 	
       F014

 
	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
 /s/ Karen
 Weich

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
 Name: Karen Weich

 
	
  

 	
 Title: Vice President

 
	
  

 	
  

 	
       W011

 
	
  

 	
  

 	
  

 
	
  

 	
 MIZUHO
 CORPORATE BANK, LTD.,

 
	
  

 	
  

 
	
  

 	
 By:

 	
 /s/ David
 Lim

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
 Name: David Lim

 
	
  

 	
 Title: Authorized Signatory

 
	
  

 	
  

 	
  

 
	
  

 	
 WELLS FARGO
 BANK, NATIONAL ASSOCIATION,

 
	
  

 	
  

 
	
  

 	
 By:

 	
 /s/ Grainne
 M. Pergolini

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
 Name: Grainne M. Pergolini

 
	
  

 	
 Title: Director

 










SCHEDULE I


Commitments


	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Name of Lender

 	
  

 	
  

 	
 Commitment ($)

 	
  

 	
 Loan Sublimit ($)

 	
  

 
	

 

 	
  

 	
  

 	

 


 	
  

 	

 


 	
  

 
	
  

 
	
 JPMorgan
 Chase Bank, N.A.

 	
  

 	
 $

 	
 114,750,000.00

 	
  

 	
 $

 	
 85,000,000.00 

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Citibank,
 N.A.

 	
  

 	
 $

 	
 114,750,000.00

 	
  

 	
 $

 	
 85,000,000.00 

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 The Royal
 Bank of Scotland plc

 	
  

 	
 $

 	
 114,750,000.00

 	
  

 	
 $

 	
 85,000,000.00 

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Barclays
 Bank PLC

 	
  

 	
 $

 	
 96,187,500.00

 	
  

 	
 $

 	
 71,250,000.00 

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Credit
 Agricole Corporate & Investment Bank

 	
  

 	
 $

 	
 96,187,500.00

 	
  

 	
 $

 	
 71,250,000.00 

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Deutsche
 Bank AG New York Branch

 	
  

 	
 $

 	
 96,187,500.00

 	
  

 	
 $

 	
 71,250,000.00 

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Goldman
 Sachs Bank USA

 	
  

 	
 $

 	
 96,187,500.00

 	
  

 	
 $

 	
 71,250,000.00 

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 The Bank of
 Tokyo-Mitsubishi UFJ, Ltd.

 	
  

 	
 $

 	
 96,187,500.00

 	
  

 	
 $

 	
 71,250,000.00 

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Wells Fargo
 Bank, N.A.

 	
  

 	
 $

 	
 96,187,500.00

 	
  

 	
 $

 	
 71,250,000.00 

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 HSBC Bank
 USA, National Association

 	
  

 	
 $

 	
 82,687,500.00

 	
  

 	
 $

 	
 61,250,000.00 

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Lloyds TSB
 Bank plc

 	
  

 	
 $

 	
 82,687,500.00

 	
  

 	
 $

 	
 61,250,000.00 

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Mizuho
 Corporate Bank, Ltd.

 	
  

 	
 $

 	
 82,687,500.00

 	
  

 	
 $

 	
 61,250,000.00 

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 The Bank of
 New York Mellon

 	
  

 	
 $

 	
 82,687,500.00

 	
  

 	
 $

 	
 61,250,000.00 

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Bank of
 America, N.A.

 	
  

 	
 $

 	
 48,937,500.00

 	
  

 	
 $

 	
 36,250,000.00 

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Morgan
 Stanley Bank, N.A.

 	
  

 	
 $

 	
 48,937,500.00

 	
  

 	
 $

 	
 36,250,000.00 

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 $

 	
 1,350,000,000.00

 	
  

 	
 $

 	
 1,000,000,000.00
 

 	
  

 









SCHEDULE II


Indebtedness and Liens


Part A – Indebtedness


	
  

 	
  

 	
  

 
	
  

 	
 1.

 	
 6.50%
 guaranteed senior notes due January 15, 2012, issued by XL Capital Finance
 (Europe) plc and guaranteed by XL Capital Ltd, under the Indenture dated
 January 10, 2002, by and among XL Capital Finance (Europe) plc, XL Capital
 Ltd and State Street Bank and Trust Company.

 
	
  

 	
  

 	
  

 
	
  

 	
 2.

 	
 Indenture,
 dated as of June 2, 2004, between XL Capital Ltd and The Bank of New York, as
 Trustee.

 
	
  

 	
  

 	
  

 
	
  

 	
 3.

 	
 Indenture,
 dated as of January 10, 2002, among XL Capital Finance (Europe) plc, XL Capital
 Ltd and State Street Bank and Trust Company.

 
	
  

 	
  

 	
  

 
	
  

 	
 4.

 	
 Indenture,
 dated as of September 30, 2011, among XL Group Ltd., XL Group plc and Wells
 Fargo

 
	
  

 	
  

 	
  

 
	
  

 	
 5.

 	
 5.25% Senior
 Notes due 2014, under the First Supplemental Indenture, dated as of August
 23, 2004, to the Indenture dated as of June 2, 2004 between XL Capital Ltd
 and the Bank of New York, as Trustee.

 
	
  

 	
  

 	
  

 
	
  

 	
 6.

 	
 6.375%
 Senior Notes due 2024, under the Second Supplemental Indenture, dated as of
 November 12, 2004, to the Indenture, dated as of June 2, 2004, between XL
 Capital Ltd and The Bank of New York, as Trustee.

 
	
  

 	
  

 	
  

 
	
  

 	
 7.

 	
 6.25% Senior
 Notes due May 15, 2027, under the Fourth Supplemental Indenture, dated May 7,
 2007, to the Indenture, dated as of June 2, 2004, between XL Capital Ltd and
 The Bank of New York, as trustee.

 
	
  

 	
  

 	
  

 
	
  

 	
 8.

 	
 5.75% Senior
 Notes due 2021, under the First Supplemental Indenture, dated as of September
 30, 2011, to the Indenture dated as of September 30, 2011, between XL Group
 Ltd., XL Group plc, as guarantor, and Wells Fargo.

 
	
  

 	
  

 	
  

 
	
  

 	
 9.

 	
 Replacement
 Capital Covenant, dated March 15, 2007.

 
	
  

 	
  

 	
  

 
	
  

 	
 10.

 	
 Pledge
 Agreement dated as of December 18, 2001, made by XL Investments Ltd, XL Re
 Ltd, XL Insurance (Bermuda) Ltd and XL Europe Ltd as grantors and in favour
 of Citibank, N.A.

 













	
  

 	
  

 	
  

 
	
  

 	
 11.

 	
 Amendment
 No. 1 dated as of July 1, 2003, to the Pledge Agreement dated as of December
 18, 2001, made by XL Investments Ltd, XL Re Ltd, XL Insurance (Bermuda) Ltd
 and XL Europe Ltd as grantors and in favour of Citibank, N.A.

 
	
  

 	
  

 	
  

 
	
  

 	
 12.

 	
 Insurance
 Letters of Credit – Master Agreement dated May 19, 1993, between XL Re Ltd
 and Citibank, N.A.

 
	
  

 	
  

 	
  

 
	
  

 	
 13.

 	
 Service
 Agreement Relative to Sureties, Letters of Guarantees and International
 Stand-by L/Cs dated April 25, 2003, between XL Re Europe Limited (formerly
 known as Le Mans Re) and Calyon (formerly known as Credit Lyonnais).

 
	
  

 	
  

 	
  

 
	
  

 	
 14.

 	
 Assignment
 Agreement dated July 11, 2003, among XL Re Ltd, Mangrove Bay Trust and The
 Bank of New York.

 
	
  

 	
  

 	
  

 
	
  

 	
 15.

 	
 Insurance
 Letter of Credit – Master Agreement, dated 11 November 2009, between XL
 Insurance (Bermuda) Ltd and Citibank Europe PLC.

 
	
  

 	
  

 	
  

 
	
  

 	
 16.

 	
 Pledge
 Agreement dated as of 11 November 2009 between XL Insurance (Bermuda) Ltd and
 XL Re Ltd as Pledgors and Citibank Europe PLC as Pledgee.

 
	
  

 	
  

 	
  

 
	
  

 	
 17.

 	
 Amendment
 No. 1, dated as of November 23, 2009, to Pledge Agreement dated as of 11
 November 2009 between XL Insurance (Bermuda) Ltd and XL Re Ltd as Pledgors
 and Citibank Europe PLC as Pledgee.

 
	
  

 	
  

 	
  

 
	
  

 	
 18.

 	
 Amendment
 No. 2, dated as of December 23, 2009, to Pledge Agreement dated as of 11 November
 2009 between XL Insurance (Bermuda) Ltd and XL Re Ltd as Pledgors and
 Citibank Europe PLC as Pledgee.

 
	
  

 	
  

 	
  

 
	
  

 	
 19.

 	
 Amendment
 No. 3, dated as of June 30, 2010, to Pledge Agreement dated as of 11 November
 2009 between XL Insurance (Bermuda) Ltd and XL Re Ltd as Pledgors and
 Citibank Europe PLC.

 
	
  

 	
  

 	
  

 
	
  

 	
 20.

 	
 The London
 Market Letter of Credit Scheme, dated October 21, 1996, between Mid Ocean
 Reinsurance Company Limited and Citibank, N.A.

 
	
  

 	
  

 	
  

 
	
  

 	
 21.

 	
 Amendment
 No. 1, dated June 24, 2002, to Pledge Agreement, dated December 18, 

 













	
  

 	
  

 	
  

 
	
  

 	
  

 	
 2001,
 between XL Investments Ltd, XL Re Ltd, XL Insurance (Bermuda) Ltd, XL Europe
 Ltd and Citibank, N.A.

 
	
  

 	
  

 	
  

 
	
  

 	
 22.

 	
 Amendment
 No. 2, dated February 24, 2009, to Pledge Agreement, dated December 18, 2001,
 between XL Investments Ltd, XL Re Ltd, XL Insurance (Bermuda) Ltd, XL
 Insurance Company Ltd and Citibank, N.A.

 
	
  

 	
  

 	
  

 
	
  

 	
 23.

 	
 Amendment
 No. 3, dated March 20, 2009, to Pledge Agreement, dated December 18, 2001,
 between XL Investments Ltd, XL Re Ltd, XL Insurance (Bermuda) Ltd and
 Citibank, N.A.

 
	
  

 	
  

 	
  

 
	
  

 	
 24.

 	
 Amendment
 No. 4, dated December 14, 2010, to Pledge Agreement, dated December 18, 2001,
 between XL Investments Ltd, XL Re Ltd, XL Insurance (Bermuda) Ltd and
 Citibank, N.A.

 
	
  

 	
  

 	
  

 
	
  

 	
 25.

 	
 Guarantee
 Agreement, dated December 18, 2001, between XL Re Ltd, XL Insurance (Bermuda)
 Ltd, XL Insurance Company Ltd and Citibank, N.A. 

 
	
  

 	
  

 	
  

 
	
  

 	
 26.

 	
 Amendment
 No. 1, dated February 24, 2009, to Guarantee Agreement, dated December 18,
 2001, between XL Investments Ltd, XL Re Ltd, XL Insurance (Bermuda) Ltd, XL
 Europe Ltd and Citibank, N.A.

 
	
  

 	
  

 	
  

 
	
  

 	
 27.

 	
 Sixth
 Supplemental Indenture, dated as of June 30, 2010, to the Indenture, dated as
 of June 2, 2004, and the Fifth Supplemental Indenture, dated as of August 5,
 2008, between XL Capital Ltd, XL Group plc, as guarantor and The Bank of New
 York Mellon, as trustee.

 
	
  

 	
  

 	
  

 
	
  

 	
 28.

 	
 Supplemental
 Indenture, dated as of June 30, 2010, to the Indenture, dated as of January
 10, 2002, among XL Capital Finance (Europe) plc, XL Capital Ltd, XL Company
 Switzerland GmbH and State Street Bank and Trust Company.

 
	
  

 	
  

 	
  

 
	
  

 	
 29.

 	
 Lease
 Guarantee, dated April 30, 2007, between XL Capital Investment Partners Inc.,
 X.L. America, Inc. and 1540 Broadway Owner, LLC.

 
	
  

 	
  

 	
  

 
	
  

 	
 30.

 	
 Lease
 Guarantee and Surety Agreement, dated November 30, 2010, between XL Global
 Services, Inc., X.L. America, Inc., and 505 Eagleview Blvd Assoc. LP. 

 
	
  

 	
  

 	
  

 
	
  

 	
 31.

 	
 70
 Gracechurch, London, EC3V 0XL Capital Lease. 

 













	
  

 	
  

 	
  

 
	
  

 	
 32.

 	
 Lease
 Guarantee, dated October 2011, by X.L. America, Inc. in favor of Two Harbor
 Point Square LLC.

 













Part B - Liens


	
  

 	
  

 	
  

 
	
  

 	
 1.

 	
 Insurance
 Letters of Credit – Master Agreement dated May 19, 1993, between XL Re Ltd
 and Citibank, N.A.

 
	
  

 	
  

 	
  

 
	
  

 	
 2.

 	
 Pledge
 Agreement dated as of December 18, 2001, made by XL Investments Ltd, XL Re
 Ltd, XL Insurance (Bermuda) Ltd and XL Europe Ltd as grantors and in favour
 of Citibank, N.A.

 
	
  

 	
  

 	
  

 
	
  

 	
 3.

 	
 Amendment
 No. 1 dated as of July 1, 2003, to the Pledge Agreement dated as of December
 18, 2001, made by XL Investments Ltd, XL Re Ltd, XL Insurance (Bermuda) Ltd
 and XL Europe Ltd as grantors and in favour of Citibank, N.A.

 
	
  

 	
  

 	
  

 
	
  

 	
 4.

 	
 Service
 Agreement Relative to Sureties, Letters of Guarantees and International
 Stand-by L/Cs dated April 25, 2003, between XL Re Europe Limited (formerly
 known as Le Mans Re) and Calyon (formerly known as Credit Lyonnais).

 
	
  

 	
  

 	
  

 
	
  

 	
 5.

 	
 Assignment
 Agreement dated July 11, 2003, among XL Re Ltd, Mangrove Bay Trust and The
 Bank of New York.

 
	
  

 	
  

 	
  

 
	
  

 	
 6.

 	
 Floating
 Charge, dated December 31, 2010, by XL Insurance (Bermuda) Ltd in Favour of
 XL Insurance Company Limited.

 
	
  

 	
  

 	
  

 
	
  

 	
 7.

 	
 Pledge
 Agreement dated as of 11 November 2009 between XL Insurance (Bermuda) Ltd and
 XL Re Ltd as Pledgors and Citibank Europe PLC as Pledgee.

 
	
  

 	
  

 	
  

 
	
  

 	
 8.

 	
 Amendment
 No. 1, dated as of November 23, 2009, to Pledge Agreement dated as of 11
 November 2009 between XL Insurance (Bermuda) Ltd and XL Re Ltd as Pledgors
 and Citibank Europe PLC as Pledgee.

 
	
  

 	
  

 	
  

 
	
  

 	
 9.

 	
 Amendment
 No. 2, dated as of December 23, 2009, to Pledge Agreement dated as of 11
 November 2009 between XL Insurance (Bermuda) Ltd and XL Re Ltd as Pledgors
 and Citibank Europe PLC as Pledgee.

 
	
  

 	
  

 	
  

 
	
  

 	
 10.

 	
 Amendment
 No. 3, dated as of June 30, 2010, to Pledge Agreement dated as of 11 November
 2009 between XL Insurance (Bermuda) Ltd and XL Re Ltd as Pledgors and
 Citibank Europe PLC.

 













	
  

 	
  

 	
  

 
	
  

 	
 11.

 	
 Amendment
 No. 1, dated June 24, 2002, to Pledge Agreement, dated December 18, 2001,
 between XL Investments Ltd, XL Re Ltd, XL Insurance (Bermuda) Ltd, XL Europe
 Ltd and Citibank, N.A.

 
	
  

 	
  

 	
  

 
	
  

 	
 12.

 	
 Amendment
 No. 2, dated February 24, 2009, to Pledge Agreement, dated December 18, 2001,
 between XL Investments Ltd, XL Re Ltd, XL Insurance (Bermuda) Ltd, XL
 Insurance Company Ltd and Citibank, N.A.

 
	
  

 	
  

 	
  

 
	
  

 	
 13.

 	
 Amendment
 No. 3, dated March 20, 2009, to Pledge Agreement, dated December 18, 2001,
 between XL Investments Ltd, XL Re Ltd, XL Insurance (Bermuda) Ltd and
 Citibank, N.A.

 
	
  

 	
  

 	
  

 
	
  

 	
 14.

 	
 Amendment
 No. 4, dated December 14, 2010, to Pledge Agreement, dated December 18, 2001,
 between XL Investments Ltd, XL Re Ltd, XL Insurance (Bermuda) Ltd and
 Citibank, N.A.

 









SCHEDULE III


Litigation


	
  

 	
  

 	
  

 
	
  

 	
 1.

 	
 In Re Brokerage
 Antitrust Litigation, MDL No. 1663, Civil Action No. 04-5184, and related tag
 along actions. 

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 
	
  

 	
 2.

 	
 Municipal GIC-Related Litigation
 (as described in XL Group plc’s Annual Report on Form 10-K filed with the
 Securities and Exchange Commission on February 25, 2011).

 









SCHEDULE IV


Environmental Matters




None.






SCHEDULE V


Subsidiaries


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
 

	
 

	
%

	
 

	
JURISDICTION


	




	




	




	




	




	





	
XL Group plc

	
 

	
 

	
 

	
 

	
Ireland


	
XLIT Ltd.

	
 

	
 

	
 

	
 

	
Cayman


	
XL Company Switzerland GmbH

	
 

	
 

	
 

	
 

	
Switzerland


	
XL Capital Partners Corporation

	
 

	
 

	
 

	
 

	
Cayman


	
XL Capital Principal Partners I, L.L.C.

	
 

	
 

	
 

	
 

	
Delaware


	
EXEL Holdings Limited

	
 

	
 

	
 

	
 

	
Cayman


	
EXEL Acquisition Ltd.

	
 

	
 

	
 

	
 

	
Cayman


	
X.L. Property Holdings Limited

	
 

	
 

	
 

	
 

	
Bermuda


	
XL Insurance (Bermuda) Ltd

	
 

	
 

	
 

	
 

	
Bermuda


	
Mid Ocean Limited

	
 

	
 

	
 

	
 

	
Cayman


	
Mid Ocean Holdings Limited

	
 

	
 

	
 

	
 

	
Bermuda


	
Ridgewood Holdings Limited

	
 

	
 

	
 

	
 

	
Bermuda


	
XL London Market Group Ltd

	
 

	
 

	
 

	
 

	
UK


	
Brockbank Holdings Ltd

	
 

	
 

	
 

	
 

	
UK


	
Baltusrol Holdings Ltd

	
 

	
 

	
 

	
 

	
Bermuda


	
County Down Limited

	
 

	
 

	
 

	
 

	
UK


	
Dornoch Limited

	
 

	
 

	
 

	
 

	
UK


	
Stonebridge Underwriting Ltd

	
 

	
 

	
 

	
 

	
UK


	
XL London Market Services Ltd- Syndicate
1209

	
 

	
 

	
 

	
 

	
UK


	
Denham Tower Underwriting Agents (PTY)
Limited (in liquidation)

	
 

	
 

	
 

	
 

	
South Africa


	
 


	
XL London Market Ltd

	
 

	
 

	
 

	
 

	
UK


	
 


	
XL Re Ltd

	
 

	
 

	
 

	
 

	
Bermuda


	
XL BCM Limited

	
 

	
 

	
 

	
 

	
UK


	
XL CCM Ltd

	
 

	
 

	
 

	
 

	
UK


	
ECS Reinsurance Company Inc.

	
 

	
 

	
 

	
 

	
Barbados


	
Global Capital Underwriting Ltd.

	
 

	
 

	
 

	
 

	
UK


	
Fundamental Insurance Investments Ltd

	
 

	
 

	
 

	
 

	
Bermuda


	
FII Partners LLC

	
 

	
99

	
 

	
 

	
Delaware


	
FII Partners Ltd

	
 

	
 

	
 

	
 

	
Bermuda


	
FII Partners LLC

	
 

	
1

	
 

	
 

	
Delaware


	
XL Re Europe Limited

	
 

	
 

	
 

	
 

	
Ireland


	
XL Re Latin
America Ltd

	
 

	
 

	
 

	
 

	
Switzerland


	
XL Latin America Investments Ltd

	
 

	
 

	
 

	
 

	
Bermuda


	
XL Re Brazil Holdings AG

	
 

	
 

	
 

	
 

	
Switzerland


	
XL Re
Participacoes Brasil Ltda.

	
 

	
 

	
 

	
 

	
Brazil


	
XL
Resseguros Brasil S.A.

	
 

	
 

	
 

	
 

	
Brazil


	
XL Re Latin
America (Argentina SA)

	
 

	
80

	
 

	
 

	
Argentina















	
 

	
 

	
 

	
 

	
 

	
 


	
XL Re Latin
Escritorio de Representacao no Brasil Ltda

	
 

	
 

	
 

	
 

	
Brazil


	
XL Re Europe
Services AG

	
 

	
 

	
 

	
 

	
Germany


	
XL PP Limited

	
 

	
 

	
 

	
 

	
UK


	
XL (Brazil) Holdings Ltd

	
 

	
 

	
 

	
 

	
Brazil


	
XL Services (Bermuda) Ltd

	
 

	
 

	
 

	
 

	
Bermuda


	
XL Life Ltd

	
 

	
 

	
 

	
 

	
Bermuda


	
Reeve Court General Partner Limited

	
 

	
 

	
 

	
 

	
Bermuda


	
Reeve Court 4 Limited Partnership

	
 

	
 

	
 

	
 

	
Bermuda


	
Reeve Court 6 Limited Partnership

	
 

	
 

	
 

	
 

	
Bermuda


	
XL Gracechurch Limited

	
 

	
 

	
 

	
 

	
UK


	
XL Insurance (UK) Holdings Limited

	
 

	
 

	
 

	
 

	
UK


	
XL Capital
Finance (Europe) plc

	
 

	
 

	
 

	
 

	
UK


	
XL Insurance
Argentina S.A. Compañia de Seguros

	
 

	
90

	
 

	
 

	
Argentina


	
XL Services UK Limited

	
 

	
 

	
 

	
 

	
UK


	
XL Insurance Company Limited

	
 

	
 

	
 

	
 

	
UK


	
XL Insurance
Argentina S.A. Compañia de Seguros

	
 

	
10

	
 

	
 

	
Argentina


	
XL Insurance (China) Company Ltd

	
 

	
49

	
 

	
 

	
China


	
XL Holdings Proprietary Limited

	
 

	
 

	
 

	
 

	
South Africa


	
XL Insurance Company Ltd (In Liquidation)

	
 

	
 

	
 

	
 

	
South Africa


	
XL Financial Holdings (Ireland) Limited

	
 

	
 

	
 

	
 

	
Ireland


	
XL Finance (Ireland) Limited

	
 

	
 

	
 

	
 

	
Ireland


	
XL Services Canada Ltd.

	
 

	
 

	
 

	
 

	
Canada


	
*X.L. America, Inc.

	
 

	
 

	
 

	
 

	
Delaware


	
XL Financial Solutions, Inc.

	
 

	
 

	
 

	
 

	
Delaware


	
XL Capital Investment Partners Inc.

	
 

	
 

	
 

	
 

	
Delaware


	
XL Group Investments Ltd

	
 

	
 

	
 

	
 

	
Bermuda


	
XLA Garrison L.P.

	
 

	
 

	
 

	
 

	
Delaware


	
NAC Re Corporation

	
 

	
 

	
 

	
 

	
Delaware


	
XL Reinsurance America Inc. *(A-65%) - NY

	
 

	
 

	
 

	
 

	
New York


	
XL Insurance (China) Company Ltd

	
 

	
51

	
 

	
 

	
China


	
Greenwich Insurance Company *(A-12%)

	
 

	
 

	
 

	
 

	
Delaware


	
Global Asset Protection Services, LLC

	
 

	
 

	
 

	
 

	
Connecticut


	
Global Asset Protection Services Company
Limited

	
 

	
 

	
 

	
 

	
Japan


	
Global Asset Protection Services
Consultancy (Beijing) Company Limited

	
 

	
 

	
 

	
 

	
China


	
XL Insurance America, Inc. *(A-10%)

	
 

	
 

	
 

	
 

	
Delaware


	
XL Select Insurance Company *(A-2%)

	
 

	
 

	
 

	
 

	
Delaware


	
XL Insurance Company of New York, Inc. * (A-3%)

	
 

	
 

	
 

	
 

	
New York


	
XL Specialty Insurance Company *(A-6%)

	
 

	
 

	
 

	
 

	
Delaware


	
Indian Harbor Insurance Company *(A-2%)

	
 

	
 

	
 

	
 

	
North Dakota















	
 

	
 

	
 

	
 

	
 

	
 


	
37 Lambert Road LLC

	
 

	
 

	
 

	
 

	
Delaware


	
XL Global, Inc.

	
 

	
 

	
 

	
 

	
Delaware


	
XL Insurance, Inc.

	
 

	
 

	
 

	
 

	
Delaware


	
X.L. Global Services, Inc.

	
 

	
 

	
 

	
 

	
Delaware


	
XL Investment Management (USA) LLC

	
 

	
 

	
 

	
 

	
Delaware


	
Eagleview Insurance Brokerage Services, LLC

	
 

	
 

	
 

	
 

	
Delaware


	
XL Life and Annuity Holding Company

	
 

	
 

	
 

	
 

	
Delaware


	
XL Life Insurance and Annuity Company

	
 

	
 

	
 

	
 

	
Illinois


	
XL Asset Funding Company I LLC

	
 

	
 

	
 

	
 

	
Delaware


	
ECS, Inc. (In Liquidation)

	
 

	
 

	
 

	
 

	
Pennsylvania


	
ECS Child Care Center, Inc. (In
Liquidation)

	
 

	
 

	
 

	
 

	
Pennsylvania


	
XL Investments Ltd

	
 

	
 

	
 

	
 

	
Bermuda


	
XL Capital Products Ltd

	
 

	
 

	
 

	
 

	
Bermuda


	
XL SGS Holdings Inc.

	
 

	
 

	
 

	
 

	
Delaware


	
Garrison Investments Inc. (**)

	
 

	
 

	
 

	
 

	
Barbados


	
Kensington Investments Inc.

	
 

	
 

	
 

	
 

	
Barbados


	
XLB Partners Inc.

	
 

	
 

	
 

	
 

	
Barbados


	
X.L. Investments (Barbados) Inc.

	
 

	
 

	
 

	
 

	
Barbados


	
ClearWater Opportunity Fund Ltd.

	
 

	
 

	
 

	
 

	
Cayman


	
XL (LUXEMBOURG) S.a.r.l.

	
 

	
 

	
 

	
 

	
Luxembourg


	
XL (FINANCE)
S.a.r.l.

	
 

	
 

	
 

	
 

	
Luxembourg


	
XL (INTERNATIONAL) S.a.r.l.

	
 

	
 

	
 

	
 

	
Luxembourg


	
XL (SERVICES) S.a.r.l.

	
 

	
 

	
 

	
 

	
Luxembourg


	
XL (SPECIALTY) S.a.r.l.

	
 

	
 

	
 

	
 

	
Luxembourg


	
XL (WESTERN
EUROPE) S.a.r.l.

	
 

	
 

	
 

	
 

	
Luxembourg


	
XL Swiss Holdings Ltd

	
 

	
 

	
 

	
 

	
Switzerland


	
XL Re Latin
America (Argentina SA)

	
 

	
20

	
 

	
 

	
Argentina


	
XL Insurance Switzerland Ltd.

	
 

	
 

	
 

	
 

	
Switzerland


	
Vitodurum Reinsurance Company Ltd.

	
 

	
 

	
 

	
 

	
Switzerland


	
XL Services Switzerland AG

	
 

	
 

	
 

	
 

	
Switzerland


	
XL India Business Services Private Limited

	
 

	
 

	
 

	
 

	
India


	
XL Insurance Mexico SA de CV

	
 

	
 

	
 

	
 

	
Mexico


	
XL Europe Holdings Ltd

	
 

	
 

	
 

	
 

	
Bermuda


	
 

	
 

	
 

	
 

	
 

	
 


	
*A = Company is a member of the Reinsurance
America Inc. Pooling Agreement with individual company pooling % noted

(**) - Limited Partner of XLA Garrison L.P.












SCHEDULE VI


Existing Letters of Credit


Syndicated Letters of Credit


	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
BOOKING PARTY NAME
	
 
	
REF NUMBER
	
 
	
EXPIRY /

MATURITY

DATE
	
 
	
LC AVAILABLE

AMOUNT

	


	
 
	


	
 
	


	
 
	



	
XL RE Ltd
	
 
	
U-230425
	
 
	
12/31/12
	
 
	
$
	
116,663,986.00 



Non-Syndicated Letters of Credit


None.


Participated Letters of Credit


None.






EXHIBIT A


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 Lender 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 Credit Agreement
identified below (including any letters of credit and guarantees included in
such facilities) 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 Lender) 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 loan 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 Lender]1 [and is a
 NAIC Approved Bank]2 ]

 
	
  

 	
  

 	
  

 
	
 3.

 	
 Account
 Parties:

 	
 XL Group plc, XLIT Ltd., X.L. America, Inc., XL Insurance (Bermuda)
 Ltd, XL Re Ltd, XL Re Europe Limited, XL Insurance Company Limited, XL Insurance
 Switzerland Ltd and XL Life Ltd

 






	
  

 	
  

 	
  

 
	

 


 	
  

 
	
 1 Select
as applicable.

 
	
2 Insert
to the extent required by Section 10.04(b) of the Credit Agreement.

 













	
  

 	
  

 	
  

 
	
 4.

 	
 Administrative
 Agent:

 	
 JPMorgan Chase Bank, N.A., as the administrative agent under the
 Credit Agreement

 
	
  

 	
  

 	
  

 
	
 5.

 	
 Credit
 Agreement:

 	
 Unsecured Credit Agreement dated as of December 9, 2011 (as amended
 and in effect from time to time, the “Credit Agreement”), between XL
 Group plc, XLIT Ltd., X.L. America, Inc., XL Insurance (Bermuda) Ltd, XL Re
 Ltd, XL Re Europe Limited, XL Insurance Company Limited, XL Insurance
 Switzerland Ltd and XL Life Ltd, the Lenders named therein and JPMorgan Chase
 Bank, N.A., as Administrative Agent

 













	
  

 	
  

 	
  

 
	
 6.

 	
 Assigned
 Interest:

 	
  

 





	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Aggregate Amount of 

 Commitment/Loans 

 for all Lenders

 	
  

 	
 Amount of 

 Commitment/Loan 

 Assigned

 	
  

 	
 Percentage Assigned 

 of 

 Commitment/Loans 3

 
	

 


 	
  

 	

 


 	
  

 	

 


 
	
 $

 	
  

 	
 $

 	
  

 	
 %

 
	
 $

 	
  

 	
 $

 	
  

 	
 %

 
	
 $

 	
  

 	
 $

 	
  

 	
 %

 


Effective Date: _____________ ___, 20___ [TO BE INSERTED BY
ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF
TRANSFER IN THE REGISTER THEREFOR.]


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


	
  

 	
  

 	
  

 
	
  

 	
 ASSIGNOR

 
	
  

 	
  

 
	
  

 	
 [NAME OF
 ASSIGNOR]

 
	
  

 	
  

 
	
  

 	
 By:

 	
  

 
	
  

 	
  

 	

 


 
	
  

 	
    Title:

 
	
  

 	
  

 
	
  

 	
 ASSIGNEE

 
	
  

 	
  

 
	
  

 	
 [NAME OF
 ASSIGNEE]

 
	
  

 	
  

 
	
  

 	
 By:

 	
  

 
	
  

 	
  

 	

 


 
	
  

 	
    Title:

 






	
  

 	
  

 	
  

 
	

 


 	
  

 
	
 3 Set forth,
 to at least 9 decimals, as a percentage of the Commitment of all Lenders
 thereunder.

 














	
  

 	
  

 	
  

 
	
 Consented to
 and Accepted:

 	
  

 
	
  

 	
  

 
	
 JPMORGAN
 CHASE BANK, N.A.,

 	
  

 
	
   as
 Administrative Agent

 	
  

 
	
  

 	
  

 
	
 By

 	
  

 	
  

 
	
  

 	

 


 	
  

 
	
    Title:

 	
  

 
	
  

 	
  

 
	
 [Consented
 to:]4

 	
  

 
	
  

 	
  

 
	
 Signed and
 Delivered as a Deed

 	
  

 
	
 for and on
 behalf of

 	
  

 
	
 XL GROUP
 PLC,

 	
  

 
	
 as an
 Account Party and a Guarantor

 	
  

 
	
 by its duly
 authorized attorney

 	
  

 
	
 in the
 presence of:

 	
  

 
	
  

 	
  

 
	
 By

 	
  

 	
  

 
	
  

 	

 


 	
  

 
	
    Name:

 	
  

 
	
    Title:
 Attorney 

 	
  

 
	
  

 	
  

 
	

 


 	
  

 
	
 Witness

 	
  

 
	
    Name:

 	
  

 
	
    Title:
 

 	
  

 
	
  

 	
  

 
	
 XLIT LTD., 

 	
  

 
	
 as an
 Account Party and a Guarantor

 	
  

 
	
  

 	
  

 
	
 By:

 	
  

 
	
  

 	

 


 	
  

 
	
    Name:

 	
  

 
	
    Title:

 	
  

 
	
  

 	
  

 
	
 By:

 	
  

 
	
  

 	

 


 	
  

 
	
    Name:

 	
  

 
	
    Title:

 	
  

 
				






	
  

 	
  

 	
  

 
	

 


 	
  

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

 














	
  

 	
  

 	
  

 
	
 X.L. AMERICA,
 INC.,

 	
  

 
	
 as an
 Account Party and a Guarantor

 	
  

 
	
  

 	
  

 
	
 By

 	
  

 
	
  

 	

 


 	
  

 
	
    Name:

 	
  

 
	
    Title:
 

 	
  

 
	
  

 	
  

 
	
 XL INSURANCE
 (BERMUDA) LTD, 

 	
  

 
	
 as an
 Account Party and a Guarantor

 	
  

 
	
  

 	
  

 
	
 By

 	
  

 
	
  

 	

 


 	
  

 
	
    Name:

 	
  

 
	
    Title:
 

 	
  

 
	
  

 	
  

 
	
 XL RE LTD, 

 	
  

 
	
 as an
 Account Party and a Guarantor

 	
  

 
	
  

 	
  

 
	
 By

 	
  

 
	
  

 	

 


 	
  

 
	
    Name:

 	
  

 
	
    Title:
 

 	
  

 
	
  

 	
  

 
	
 Signed and
 Delivered as a Deed

 	
  

 
	
 for and on
 behalf of

 	
  

 
	
 XL RE EUROPE
 LIMITED,

 	
  

 
	
 as an
 Account Party 

 	
  

 
	
 by its duly
 authorized attorney

 	
  

 
	
 in the
 presence of:

 	
  

 
	
  

 	
  

 
	
 By

 	
  

 
	
  

 	

 


 	
  

 
	
    Name:

 	
  

 
	
    Title:
 Attorney 

 	
  

 
	
  

 	
  

 
	

 


 	
  

 
	
 Witness

 	
  

 
	
    Name:

 	
  

 
	
    Title: 

 	
  

 
	
  

 	
  

 
	
 XL INSURANCE
 COMPANY LIMITED,

 	
  

 
				













	
  

 	
  

 	
  

 
	
 as an
 Account Party 

 	
  

 
	
  

 	
  

 
	
 By

 	
  

 
	
  

 	

 


 	
  

 
	
    Name:

 	
  

 
	
    Title:
 

 	
  

 
	
  

 	
  

 
	
 XL INSURANCE
 SWITZERLAND LTD,

 	
  

 
	
 as an
 Account Party 

 	
  

 
	
  

 	
  

 
	
 By

 	
  

 
	
  

 	

 


 	
  

 
	
    Name:

 	
  

 
	
    Title:
 

 	
  

 
	
  

 	
  

 
	
 By

 	
  

 
	
  

 	

 


 	
  

 
	
    Name:

 	
  

 
	
    Title:
 

 	
  

 
	
  

 	
  

 
	
 XL LIFE LTD,

 	
  

 
	
 as an
 Account Party and a Guarantor 

 	
  

 
	
  

 	
  

 
	
 By

 	
  

 
	
  

 	

 


 	
  

 
	
    Name:

 	
  

 
	
    Title:
 

 	
  

 
				










ANNEX 1


UNSECURED CREDIT AGREEMENT DATED AS OF
DECEMBER 9, 2011, BETWEEN XL 

GROUP PLC, CERTAIN OF ITS SUBSIDIARIES, THE LENDERS NAMED THEREIN AND 

JPMORGAN CHASE BANK, N.A., AS ADMINISTRATIVE AGENT


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 or any other Credit Document, (ii) the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Credit
Documents or any collateral thereunder, (iii) the financial condition of any
Account Party, any of its Subsidiaries or Affiliates or any other Person
obligated in respect of any Credit Document or (iv) the performance or
observance by any Account Party, any of its Subsidiaries or Affiliates or any
other Person of any of their respective obligations under any Credit Document.


                    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 Lender 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 Lender,
(iii) from and after the Effective Date, it shall be bound by the provisions of
the Credit Agreement as a Lender thereunder and, to the extent of the Assigned
Interest, shall have the obligations of a Lender thereunder, (iv) it has
received a copy of the Credit Agreement, together with copies of the most
recent financial statements delivered pursuant to Section 6.01 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 Lender, and (v) 5attached
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 


	
  

 	
  

 
	

 


 	
  

 
	
 5 Both
 U.S. Lenders and Non-U.S. Lenders have to provide forms under Section
 2.19(f). Also make change in secured agreement.

 









Assignor or any other Lender, 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 Documents, and
(ii) it will perform in accordance with their terms all of the obligations
which by the terms of the Credit Documents are required to be performed by it
as a Lender.


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





EXHIBIT B


[Form of Confirming Lender Agreement]


[Letterhead of Issuing Lender]


[_____]


[Name of
Confirming Lender]

[Address]


Ladies and
Gentlemen:


                    Reference
is made to the Unsecured Credit Agreement dated as of December 9, 2011 (as
amended and in effect, the “Credit Agreement”), between XL Group plc,
XLIT Ltd., X.L. America, Inc., XL Insurance (Bermuda) Ltd, XL Re Ltd, XL Re
Europe Limited, XL Insurance Company Limited, XL Insurance Switzerland Ltd and
XL Life Ltd, the Lenders party thereto and JPMorgan Chase Bank, N.A., as
Administrative Agent. Terms defined in the Credit Agreement are used herein
with the same meanings.


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


                    By
your signature below, you undertake that you will honor the obligations of the
Issuing Lender in respect of any draft drawn under and in strict compliance
with the terms of any Syndicated Letter of Credit and Non-Syndicated Letter of
Credit issued or continued under the Credit Agreement as if, and to the extent,
you were the Issuing Lender under the relevant Syndicated Letter of Credit or
Non-Syndicated Letter of Credit, as the case may be. Notwithstanding the
foregoing, your liability under all Syndicated Letters of Credit and
Non-Syndicated Letters of Credit at any one time issued or continued under the
Credit Agreement shall be limited to an amount (the “Liability Limit”)
equal to the Commitment of the Issuing Lender 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 Issuing Lender 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 the Person serving as the Administrative Agent, 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 Syndicated Letter of Credit and Non-Syndicated 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 Syndicated Letter of Credit or Non-





Syndicated
Letter of Credit may 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 Syndicated Letter of Credit
or Non-Syndicated Letter of Credit, as the case may be.


                    In
consideration of the foregoing, the Issuing Lender agrees that if you shall
make any LC Disbursement in respect of any Syndicated Letter of Credit or
Non-Syndicated Letter of Credit, regardless of the identity of the Account
Party of such Syndicated Letter of Credit or Non-Syndicated Letter of Credit,
as the case may be, the Issuing Lender 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 Issuing Lender 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 Issuing Lender receives such notice,
if such notice is not received prior to such time. The Issuing Lender’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 2.03(b) or 2.04(h), as applicable, 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 Issuing Lender 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. This letter agreement is an “agreement” of the type
referred to in the definition of “Confirming Lender” in Section 1.01 of the
Credit Agreement.


                    Please
indicate your acceptance of the foregoing terms and conditions by signing the
two enclosed copies of this letter agreement and returning (a) one such
signed copy to the undersigned at the address of the Issuing Lender indicated
herein and (b) the other such signed copy to the Administrative Agent,
JPMorgan Chase Bank, N.A., 1111 Fannin Street, 10th Floor, Houston, Texas
77002-6925, Attention of Vashni X. Whittaker (Telecopy No. (713) 750-2223;
Telephone No. (713) 483-1080); email address, vashni.x.whittaker@jpmorgan.com;
with a copy to JPMorgan Chase Bank, N.A., 277 Park Avenue, 11th Floor, New
York, New York 10172, Attention of Brij S Grewal (Telecopy No.
(917) 456-3256; email address brijendra.s.grewal@jpmorgan.com; Telephone
No. (212) 270-5305).









	
  

 	
  

 	
  

 	
  

 
	
  

 	
 [NAME OF
 ISSUING LENDER]

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 By

 	
  

 	
  

 
	
  

 	
  

 	

 


 
	
  

 	
    Title:

 	
  

 






	
  

 	
  

 	
  

 	
  

 
	
 AGREED AS
 AFORESAID:

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
 [NAME OF
 CONFIRMING LENDER]

 	
  

 
	
  

 	
  

 
	
 By

 	
  

 	
  

 	
  

 
	
  

 	

 


 	
  

 
	
    Title:

 	
  

 	
  

 









EXHIBIT C


FORM OF BORROWING REQUEST


[Date]


JPMorgan Chase
Bank, N.A.,

as Administrative Agent

270 Park Avenue, Floor 4

New York, New York 10017

Attention: [______]


XL GROUP PLC


Ladies and
Gentlemen:


          Pursuant
to Section 2.08 of that certain Unsecured Credit Agreement, dated as of
December 9, 2011 (as amended, restated, supplemented or otherwise modified from
time to time, the “Credit Agreement”; capitalized terms used but not
defined herein having the meanings given such terms in the Credit Agreement),
among XL Group plc, an Irish public limited company (“XL Group”), XLIT
Ltd., an exempted company incorporated in the Cayman Islands with limited
liability (“XLIT”), X.L. America, Inc., a Delaware corporation (“XL
America”), XL Insurance (Bermuda) Ltd, a Bermuda limited liability company
(“XL Insurance (Bermuda)”), XL Re Ltd, a Bermuda limited liability
company (“XL Re”), XL Re Europe Limited, an Irish limited liability
company (“XL Re Europe”), XL Insurance Company Limited, a limited
company domiciled in the United Kingdom (“XL Insurance”), XL Insurance
Switzerland Ltd, a company limited by shares organized under the laws of
Switzerland (“XL Switzerland”), and XL Life Ltd, a Bermuda company (“XL
Life” and together with XL Group, XLIT, XL America, XL Insurance (Bermuda),
XL Re, XL Re Europe, XL Insurance and XL Switzerland, each an “Account Party”),
the Guarantors party thereto, JPMorgan Chase Bank, N.A., as Administrative
Agent and the lenders (the “Lenders”) party thereto, the undersigned
hereby requests a Borrowing under the Credit Agreement, and in that connection
sets forth below the information relating to such Borrowing:


          1.          The
relevant Account Party is [               ].



          2.          The
Date of Borrowing (which is a Business Day) is [               , 
     ] (the “Borrowing Date”).


          3.          The
aggregate amount of the proposed Borrowing is
$[                    ].


          4.          The
type of Borrowing is [an ABR Borrowing] [a Eurodollar Borrowing].


         [5.
         The initial
Interest Period for each Eurodollar Borrowing made as part of the proposed Loan
is __ month[s].]





          [5][6]. The location and
number of the Account Party’s account to which the funds requested pursuant to
this Borrowing Request are to be disbursed is
[               ].


                    The
undersigned hereby represents and warrants that the conditions specified in
Section 5.02 of the Credit Agreement have been satisfied as of the Borrowing
Date.


                    The
above request has been made to the Administrative Agent by telephone at
[               ].



	
  

 	
  

 	
  

 
	
  

 	
 Very truly
 yours,

 
	
  

 	
  

 	
  

 
	
  

 	
 XL GROUP PLC

 
	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
  

 
	
  

 	
  

 	

 


 
	
  

 	
      Name:

 
	
  

 	
       Title:

 









EXHIBIT D


FORM OF INTEREST ELECTION REQUEST


[               ],
201[    ]


                    XL
Group plc, an Irish public limited company (“XL Group”), pursuant to
Section 2.10 of the Unsecured Credit Agreement dated as of December 9, 2011
(together with all amendments, restatements, supplements or other modifications
thereto, the “Credit Agreement”) among XL Group, XLIT Ltd., an exempted
company incorporated in the Cayman Islands with limited liability (“XLIT”),
X.L. America, Inc., a Delaware corporation (“XL America”), XL Insurance
(Bermuda) Ltd, a Bermuda limited liability company (“XL Insurance (Bermuda)”),
XL Re Ltd, a Bermuda limited liability company (“XL Re”), XL Re Europe
Limited, an Irish limited liability company (“XL Re Europe”), XL
Insurance Company Limited, a limited company domiciled in the United Kingdom (“XL
Insurance”), XL Insurance Switzerland Ltd, a company limited by shares
organized under the laws of Switzerland (“XL Switzerland”), and XL Life
Ltd, a Bermuda company (“XL Life” and together with XL Group, XLIT, XL
America, XL Insurance (Bermuda), XL Re, XL Re Europe, XL Insurance and XL
Switzerland, each an “Account Party”), the Guarantors party thereto,
JPMorgan Chase Bank, N.A., as Administrative Agent and the lenders (the “Lenders”)
party thereto (unless otherwise defined herein, each capitalized term used
herein is defined in the Credit Agreement), hereby makes an Interest Election
Request as follows:


                    (i) The
Borrowing to which this Interest Election Request applies is
[               ]6;



                    (ii) The
effective date of the election made pursuant to this Interest Election Request
is
[               ],
201[     ] (which shall be a Business Day); [and]


                    (iii) The
resulting Borrowing is to be [an ABR Borrowing][a Eurodollar Borrowing][; and]


                    [(iv) [If
the resulting Borrowing is a Eurodollar Borrowing] The Interest Period applicable
to the resulting Borrowing after giving effect to such election is
[               ]].


                    The
above request has been made to the Administrative Agent by telephone at
[               ].



	
  

 	
  

 
	

 


 	
  

 
	
 6 If
 different options are being elected with respect to different portions of the
 Borrowing, provide the portions thereof to be allocated to each resulting
 Borrowing (in which case the information specified pursuant to items (iii)
 and (iv) shall be specified for each resulting Borrowing). 

 









Very truly yours,


	
  

 	
  

 	
  

 
	
 XL GROUP PLC

 	
  

 
	
  

 	
  

 	
  

 
	
 By:

 	
  

 	
  

 
	
  

 	

 


 	
  

 
	
 Name:

 	
  

 	
  

 
	
 Title: