Document:

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                                                                    EXHIBIT 10.1

                           FORM OF ADVISORY AGREEMENT

     THIS ADVISORY AGREEMENT (this "AGREEMENT"), dated as of ___________ ____,
2006 and effective as of the date the Registration Statement (as defined below)
is declared effective by the Securities and Exchange Commission (the "EFFECTIVE
DATE"), is by and among NNN HEALTHCARE/OFFICE REIT, INC., a Maryland corporation
(the "COMPANY"), NNN HEALTHCARE/OFFICE REIT HOLDINGS, L.P., a Delaware limited
partnership (the "PARTNERSHIP"), NNN HEALTHCARE/OFFICE REIT ADVISOR, LLC., a
Delaware limited liability company (the "ADVISOR") and, solely for purposes of
Section 32 of this Agreement, TRIPLE NET PROPERTIES, LLC., a Virginia limited
liability company (the "TRIPLE NET").

                                   WITNESSETH

     WHEREAS, the Company is filing with the Securities and Exchange Commission
a Registration Statement on Form S-11 (the "REGISTRATION STATEMENT") covering
the initial public offering of its common stock, par value $0.01 per share (the
"SHARES");

     WHEREAS, the Company intends to qualify as a REIT (as defined below), and
intends to invest its funds in investments permitted by the terms of the
Company's Articles of Incorporation and Sections 856 through 860 of the Code (as
defined below);

     WHEREAS, the Company is the general partner of the Partnership and intends
to conduct all of its business and make all of its investments in Properties and
Real Estate Related Securities through the Partnership;

     WHEREAS, the Company and the Partnership desire to avail themselves of the
experience, sources of information, advice, assistance and certain facilities
available to the Advisor and to have the Advisor undertake the duties and
responsibilities hereinafter set forth, on behalf of, and subject to the
supervision of, the Board of Directors of the Company all as provided herein;
and

     WHEREAS, the Advisor is willing to undertake to render such services,
subject to the supervision of the Board of Directors, on the terms and
conditions hereinafter set forth.

     NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements contained herein, the parties hereto agree as follows:

     1. DEFINITIONS. As used in this Agreement, the following terms have the
definitions hereinafter indicated:

     ACQUISITION EXPENSES. Any and all expenses incurred by the Company, the
Partnership, the Advisor, or any Affiliate of either in connection with the
selection, evaluation, acquisition and development of, and investment in
Properties, whether or not acquired or made, including, but not limited to,
legal fees and expenses, travel and communications expenses, cost of appraisals
and surveys, nonrefundable option payments on property not acquired, accounting
fees and expenses, computer use related expenses, architectural, engineering and
other property reports, environmental and asbestos audits, title insurance and
escrow fees, loan fees or points or any fee of a similar nature paid to a third
party, however designated, transfer taxes, and personnel and miscellaneous
expenses related to the selection, evaluation and acquisition of properties.

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     ADVISOR. NNN Healthcare/Office REIT Advisor, LLC, a Delaware limited
liability company, any successor advisor to the Company, the Partnership or any
Person(s) to which NNN Healthcare/Office REIT Advisor, LLC or any successor
advisor subcontracts substantially all of its functions.

     AFFILIATE OR AFFILIATED. An Affiliate of another Person includes only the
following: (i) any Person directly or indirectly owning, controlling, or holding
with the power to vote ten percent (10%) or more of the outstanding voting
securities of such other Person; (ii) any Person ten percent (10%) or more of
whose outstanding voting securities are directly or indirectly owned,
controlled, or held, with power to vote, by such other Person; (iii) any Person
directly or indirectly controlling, controlled by, or under common control with
such other Person; (iv) any executive officer, director, trustee, or general
partner of such other Person; and (v) any legal entity for which such Person
acts as an executive officer, director, trustee, or general partner. An entity
shall not be deemed to control or be under common control with an
Advisor-sponsored program unless (i) the entity owns ten percent (10%) or more
of the voting equity interests of such program or (ii) a majority of the board
of directors (or equivalent governing body) of such program is comprised of
Affiliates of the entity.

     APPRAISED VALUE. Value according to an appraisal made by an Independent
Appraiser.

     ARTICLES OF INCORPORATION. The Articles of Incorporation of the Company
under Title 2 of the Corporations and Associations Article of the Annotated Code
of Maryland dated as of April 20, 2006, as amended from time to time.

     ASSET MANAGEMENT FEE. The Asset Management Fee payable to the Advisor as
defined in Section 8(b).

     AVERAGE INVESTED ASSETS. For a specified period, the average of the
aggregate Book Value of the assets of the Company invested, directly or
indirectly, in Real Estate Related Securities or Properties, before reserves for
depreciation, bad debts or other similar non-cash reserves, computed by taking
the average of such values at the end of each month during such period.

     BOARD OF DIRECTORS OR BOARD. The persons holding such office, as of any
particular time, under the Articles of Incorporation of the Company, whether
they be the Directors named therein or additional or successor Directors.

     BOOK VALUE. The value of an asset on the books of the Company, before
allowance for depreciation or amortization.

     BYLAWS. The bylaws of the Company, as the same are in effect from time to
time.

     CAPPED O&O EXPENSES. All Organizational and Offering Expenses other than
selling commissions, the marketing support fee and the due diligence
reimbursement as described under "Plan of Distribution" to the Registration
Statement.

     CAUSE. With respect to the termination of this Agreement, fraud, criminal
conduct, willful misconduct or willful or grossly negligent breach of fiduciary
duty by the Advisor, or a material breach of this Agreement by the Advisor,
provided that (i) the Advisor does not cure any such material breach within
thirty (30) days of receiving notice of such material breach from the Company or
the Partnership, or (ii) such material breach is not of a nature that can be
remedied within such period.

     CODE. Internal Revenue Code of 1986, as amended from time to time, or any
successor statute thereto. Reference to any provision of the Code shall mean
such provision as in effect from time to time,

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as the same may be amended, and any successor provision thereto, as interpreted
by any applicable regulations as in effect from time to time.

     COMPANY. NNN Healthcare/Office REIT, Inc., a corporation organized under
the laws of the State of Maryland.

     COMPETITIVE REAL ESTATE COMMISSION. A real estate or brokerage commission
for the purchase or sale of a property which is reasonable, customary, and
competitive in light of the size, type, and location of the property.

     CONTRACT PURCHASE PRICE. The amount actually paid or allocated in respect
of the purchase, development, construction or improvement of a Property, in each
case exclusive of Real Estate Commissions and Acquisition Expenses.

     CONTRACT SALES PRICE. The total consideration received by the Company for
the sale of a Property exclusive of the applicable Disposition Fee.

     DIRECTOR. A member of the Board of Directors of the Company.

     DISPOSITION FEE. The fee payable to the Advisor under certain circumstances
in connection with the Sale of one or more Properties pursuant to Section 8(c).

     DISTRIBUTIONS. Any distributions of money or other property by the Company
to owners of Shares, including distributions that may constitute a return of
capital for federal income tax purposes.

     FISCAL YEAR. Any period for which any income tax return is submitted by the
Company to the Internal Revenue Service and which is treated by the Internal
Revenue Service as a reporting period.

     GOOD REASON. With respect to the termination of this Agreement, (i) any
failure to obtain a satisfactory agreement from any successor to the Company and
the Partnership to assume and agree to perform the Company's and the
Partnership's obligations under this Agreement; or (ii) any material breach of
this Agreement by the Company, provided that (x) the Company does not cure such
material breach within thirty (30) days of receiving notice of such material
breach from the Advisor, or (y) such material breach is not of a nature that can
be remedied within such period.

     GROSS INCOME. All cash receipts derived from the operation of any Property,
excluding (i) tenant security deposits unless and until such deposits are
forfeited upon a tenant default and (ii) proceeds from insurance claims,
condemnation proceedings, sales or refinancings.

     GROSS OFFERING PROCEEDS. The aggregate purchase price of all Shares sold
for the account of the Company through an Offering, without deduction for volume
discounts or Organizational and Offering Expenses. For the purpose of computing
Gross Offering Proceeds, the purchase price of any Share for which reduced
selling commissions are paid to the dealer manager or a soliciting dealer (where
net proceeds to the Company are not reduced) shall be deemed to be the full
amount of the offering price per Share pursuant to the prospectus for such
Offering without reduction.

     INDEPENDENT APPRAISER. A person or entity with no material current or prior
business or personal relationship with the Advisor or the Directors, who is
engaged to a substantial extent in the business of

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rendering opinions regarding the value of assets of the type held by the
Company, and who is a qualified appraiser of real estate as determined by the
Board. Membership in a nationally recognized appraisal society such as the
American Institute of Real Estate Appraisers or the Society of Real Estate
Appraisers shall be conclusive evidence of such qualification.

     INDEPENDENT DIRECTOR. A Director who is not and within the last two years
has not been directly or indirectly associated with the Advisor by virtue of (i)
ownership of an interest in the Advisor or its Affiliates, (ii) employment by
the Advisor or its Affiliates, (iii) service as an officer or director of the
Advisor or its Affiliates, (iv) performance of services, other than as a
Director, for the Company, (v) service as a director or trustee of more than
three REITs advised by the Advisor, or (vi) maintenance of a material business
or professional relationship with the Advisor or any of its Affiliates. A
business or professional relationship is considered material if the gross income
derived by the Director from the Advisor and Affiliates (excluding fees for
serving as a director of the Company or other REIT or real estate programs
organized or advised by the Advisor or its Affiliates) exceeds five percent (5%)
of either the Director's annual gross income during either of the last two years
or the Director's net worth on a fair market value basis. An indirect
relationship shall include circumstances in which a Director's spouse, parents,
children, siblings, mothers or fathers-in-law, sons or daughters-in-law, or
brothers or sisters-in-law is or has been associated with the Advisor, any of
its Affiliates, or the Company.

     JOINT VENTURE. Any joint venture, partnership, limited liability company or
other Affiliate of the Company (other than the Partnership) that owns, in whole
or in part on behalf of the Company, any Properties.

     LEASE-UP FEE. The Lease-Up Fee payable to the Advisor, an Affiliate of the
Advisor or a non-affiliated third party as the Property Manager as defined in
Section 8(d).

     LISTING. The term "LISTING" shall mean that the Shares have been approved
for trading on a national securities exchange. Upon such Listing, the Shares
shall be deemed Listed.

     NASAA GUIDELINES. The NASAA Statement of Policy Regarding Real Estate
Investment Trusts as in effect on the date hereof.

     NET INCOME. For any period, the total revenues applicable to such period,
less the total expenses applicable to such period excluding additions to
reserves for depreciation, bad debts or other similar non-cash reserves;
provided, however, Net Income for purposes of calculating total allowable
Operating Expenses (as defined herein) shall exclude the gain from the sale of
the Company's assets.

     OFFERING. Any offering of Shares that is registered with the SEC, excluding
Shares offered under any employee benefit plan.

     OFFERING STAGE. The period from the commencement of the Company's initial
public equity offering through the termination of the Company's last public
equity offering prior to Listing. For purposes of this definition, "public
equity offering" does not include offerings on behalf of selling stockholders or
offerings related to a distribution reinvestment plan, employee benefit plan or
the redemption of interests in the Partnership.

     OPERATING EXPENSES. All costs and expenses incurred by the Company, as
determined under generally accepted accounting principles, which in any way are
related to the operation of the Company or to Company business, including fees
paid to the Advisor, but excluding (i) the expenses of raising capital such as
Organizational and Offering Expenses, legal, audit, accounting, underwriting,
brokerage, listing, registration, and other fees, printing and other such
expenses and tax incurred in connection with

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the issuance, distribution, transfer, registration and Listing of the Shares,
(ii) interest payments, (iii) taxes, (iv) non-cash expenditures such as
depreciation, amortization and bad loan reserves, (v) incentive fees paid in
compliance with Section IV.F of the NASAA Guidelines and (vi) Real Estate
Commissions and Acquisition Expenses, real estate commissions on resale of
property, and other expenses connected with the acquisition, disposition, and
ownership of real estate interests, mortgage loans or other property (such as
the costs of foreclosure, insurance premiums, legal services, maintenance,
repair and improvement of property).

     ORGANIZATIONAL AND OFFERING EXPENSES. Any and all costs and expenses,
including selling commissions, the marketing support fee and the due diligence
expense reimbursement, incurred by the Advisor or any Affiliate in connection
with the formation, qualification and registration of the Company and the
marketing and distribution of the Shares, including, without limitation, the
following: total underwriting and brokerage discounts and commissions (including
fees of the underwriter's attorneys); printing, engraving, mailing and
distributing costs; salaries of employees while engaged in sales activity;
telephone and other telecommunications costs; all advertising and marketing
expenses (including the costs related to investor and broker-dealer sales
meetings); charges of transfer agents, registrars, trustees, escrow holders,
depositories and experts; and fees, expenses and taxes related to the filing,
registration and qualification of the sale of the Shares under federal and state
laws, including accountants' and attorneys' fees.

     PARTNERSHIP. NNN Healthcare/Office REIT Holdings, L.P., a Delaware limited
partnership formed to own and operate properties on behalf of the Company.

     PARTNERSHIP AGREEMENT. The Agreement of Limited Partnership of the
Partnership, as amended from time to time, between the Company, as General
Partner and the Advisor, as the initial Limited Partner.

     PERSON. An individual, corporation, partnership, estate, trust (including a
trust qualified under Section 401(a) or 501(c)(17) of the Code), a portion of a
trust permanently set aside for or to be used exclusively for the purposes
described in Section 642(c) of the Code, association, private foundation within
the meaning of Section 509(a) of the Code, joint stock company or other entity,
or any government or any agency or political subdivision thereof, and also
includes a group as that term is used for purposes of Section 13(d)(3) of the
Securities Exchange Act of 1934, as amended.

     PROPERTY OR PROPERTIES. Any land, rights in land (including leasehold
interests), and any buildings, structures, improvements, furnishings, fixtures
and equipment located on or used in connection with land and rights or interests
in land, or any portion thereof, transferred or conveyed to the Company or the
Partnership, either directly or indirectly, or such investments the Board of
Directors and the Advisor mutually designate as Properties to the extent such
investments could be classified as either Properties or Real Estate Related
Securities.

     PROPERTY MANAGEMENT FEE. The Property Management Fee payable to the
Advisor, an Affiliate of the Advisor or a no-affiliated third party as the
Property Manager as defined in Section 8(d).

     PROPERTY MANAGER. Any entity that has been retained to perform and carry
out property rental, leasing, operation and management services at one or more
of the Properties, excluding persons, entities or independent contractors
retained or hired to perform facility management or other services or tasks at a
particular Property.

     REIT. A real estate investment trust under Sections 856 through 860 of the
Code.

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     REAL ESTATE COMMISSION. The Real Estate Commission payable to the Advisor
as defined in Section 8(a).

     REAL ESTATE RELATED SECURITIES. Any real estate related securities
investments transferred or conveyed to the Company or the Partnership, either
directly or indirectly, or such investments the Board of Directors and the
Advisor mutually designate as Real Estate Related Securities to the extent such
investments could be classified as either Real Estate Related Securities or
Properties.

     SALE OR SALES. (i) Any transaction or series of transactions whereby: (A)
the Company or the Partnership (except as described in other subsections of this
definition) sells, grants, transfers, conveys, or relinquishes its ownership of
any Property or portion thereof, including the lease of any Property consisting
of the building only, and including any event with respect to any Property which
gives rise to a significant amount of insurance proceeds or condemnation awards;
(B) the Company or the Partnership (except as described in other subsections of
this definition) sells, puts, transfers, conveys, or relinquishes its ownership
of all or substantially all of the interest of the Company or the Partnership in
any joint venture in which it is a co-venturer or partner; (C) any joint venture
(except as described in other subsections of this definition) in which the
Company or the Partnership as a co-venturer or partner sells, grants, transfers,
conveys, or relinquishes its ownership of any Property or portion thereof,
including any event with respect to any Property which gives rise to insurance
claims or condemnation awards; (D) the Company or the Partnership directly or
indirectly (except as described in other subsections of this definition) sells,
grants, conveys or relinquishes its interest in any loan or mortgage or any
portion thereof (including with respect to any mortgage or loan, all payments
thereunder or in satisfaction thereof other than regularly scheduled interest
payments) of amounts owed pursuant to such loan or mortgage and any event which
gives rise to the payment of a significant amount of insurance proceeds or
condemnation or similar award; or (E) the Company or the Partnership directly or
indirectly (except as described in other subsections of this definition) sells,
grants, transfers, conveys or relinquishes its ownership of any other Property
not previously described in this definition or any portion thereof, but (ii) not
including any transaction or series of transactions specified in clause (i)(A),
(i)(B), (i)(C), (i)(D) or (i)(E) above in which the proceeds of such transaction
or series of transactions are reinvested in one or more Properties within one
hundred eighty (180) days thereafter.

     STOCKHOLDERS. The registered holders of the Shares.

     TERMINATION DATE. The date of termination of this Agreement.

     TERMINATION EVENT. The termination or nonrenewal of this Agreement (i) in
connection with a merger, sale of assets or other corporate transaction
involving the Company, (ii) by the Advisor for Good Reason or (iii) by the
Company and the Partnership other than for Cause.

     TOTAL DEVELOPMENT COST. With regard to any Property acquired by the Company
prior to or during the development or acquisition stages, all costs and expenses
paid or incurred by the Company that are in any way related to the development
of such Property, including, but not limited to, land and construction costs.

     TRIPLE NET. Triple Net Properties, LLC, a Virginia limited liability
company.

     2%/25% GUIDELINES. The requirement pursuant to the NASAA Guidelines that,
in any twelve (12)-month period, total Operating Expenses not exceed the greater
of two percent (2%) of the Company's Average Invested Assets during such twelve
(12)-month period or twenty-five percent (25%) of the Company's Net Income over
the same twelve (12)-month period.

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     2. APPOINTMENT. The Company and the Partnership appoints the Advisor to
serve as its advisor and asset manager as of the Effective Date, on the terms
and conditions set forth in this Agreement, and the Advisor accepts such
appointment as of the Effective Date.

     3. DUTIES AND AUTHORITY OF THE ADVISOR. The Advisor undertakes to use its
reasonable efforts (1) to present to the Company and the Partnership potential
investment opportunities in order to provide a continuing and suitable
investment program consistent with the investment objectives and policies of the
Company as determined and adopted from time to time by the Board and (2) to
manage, administer, promote, maintain, and improve the Properties on an overall
portfolio basis in a diligent manner. The services of the Advisor are to be of
scope and quality not less than those generally performed by professional asset
managers of other similar property portfolios. The Advisor shall make available
the full benefit of the judgment, experience and advice of the members of the
Advisor's organization and staff with respect to the duties it will perform
under this Agreement. The Advisor may also engage a Property Manager, which may
include Affiliates of the Advisor, to manage, promote, and lease the Properties.
To facilitate the Advisor's performance of these undertakings, but subject to
the restrictions included in Sections 4 and 7 and to the continuing and
exclusive authority of the Board and the general partner of the Partnership, the
Company and the Partnership hereby delegate to the Advisor the authority to, and
the Advisor hereby agrees to, either directly or by engaging an Affiliate:

     (A) serve as the Company's and the Partnership's investment and financial
advisor and, as requested by the Board, provide research and economic and
statistical data in connection with the Company's assets and investment
policies;

     (B) provide the daily management of the Company and the Partnership and
perform and supervise the various administrative functions reasonably necessary
for the management of the Company and the Partnership;

     (C) maintain and preserve the books and records of the Company, including
(i) a stock ledger reflecting a record of the Stockholders and their ownership
of the Company's Shares, (ii) acting as transfer agent for the Company's Shares
or selecting, engaging and overseeing the performance by a third party transfer
agent, and (iii) maintaining the accounting and other record-keeping functions
at the Property and Company levels;

     (D) investigate, select, and, on behalf of the Company and the Partnership,
engage and conduct business with such Persons as the Advisor deems necessary to
the proper performance of its obligations hereunder, including but not limited
to consultants, accountants, correspondents, lenders, technical advisors,
attorneys, brokers, underwriters, corporate fiduciaries, escrow agents,
depositaries, custodians, agents for collection, insurers, insurance agents,
banks, builders, developers, property owners, real estate management companies,
real estate operating companies, securities investment advisors, mortgagors, and
any and all agents for any of the foregoing, including Affiliates of the
Advisor, and Persons acting in any other capacity deemed by the Advisor
necessary or desirable for the performance of any of the foregoing services,
including but not limited to entering into contracts in the name of the Company
and the Partnership with any of the foregoing;

     (E) make investments in and dispositions of Real Estate Related Securities
within the discretionary limits and authority as granted by the Board and in
accordance with the Articles of Incorporation;

     (F) consult with the officers of the Company and the Board and assist the
Board in the formulation and implementation of the Company's financial policies,
and, as necessary, furnish the Board with advice and recommendations with
respect to the making of investments consistent with the

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investment objectives and policies of the Company and in connection with any
borrowings proposed to be undertaken by the Company and the Partnership;

     (G) select joint venture partners, structure corresponding agreements and
oversee and monitor these relationships;

     (H) recommend to the Board of Directors appropriate transactions which
would provide liquidity to the Stockholders;

     (I) oversee the performance by a third party or affiliated Property Manager
of its duties, including collection of payments due from third parties under
contracts related to use of any Property and other assets of the Company and
payment of Property expenses and maintenance;

     (J) conduct periodic on-site visits to some or all (as the Advisor deems
reasonably necessary) of the Properties to inspect the physical condition of the
Properties and to evaluate the performance of a third party or affiliated
Property Manager of its duties;

     (K) review, analyze and comment upon the operating budgets, capital budgets
and leasing plans prepared and submitted by a third party or affiliated Property
Manager and aggregate these property budgets into the Company's overall budget;

     (L) review and analyze on-going financial information pertaining to each
Property, each Real Estate Related Security and the overall portfolio of
Properties and Real Estate Related Securities;

     (M) if a transaction requires approval by the Board of Directors, deliver
to the Board of Directors all documents requested by them in their evaluation of
the proposed investment in the Property or the Real Estate Related Security;

     (N) formulate and oversee the implementation of strategies for the
administration, promotion, management, operation, maintenance, improvement,
financing and refinancing, marketing, leasing, and disposition of Properties on
an overall portfolio basis;

     (O) subject to the provisions of Sections 3(m) and 4 hereof, (i) locate,
analyze and select potential investments in Properties, (ii) structure and
negotiate the terms and conditions of transactions pursuant to which investment
in Properties will be made; (iii) make investments in Properties on behalf of
the Company or the Partnership in compliance with the investment objectives and
policies of the Company; (iv) arrange for financing and refinancing and make
other changes in the asset or capital structure of, and dispose of, reinvest the
proceeds from the sale of, or otherwise deal with the investments in, Property;
(v) enter into leases, supply agreements and other income-producing contracts
relating to third party use of any Property and other assets of the Company;
(vi) enter into service contracts for any Property, including oversight of
Affiliated companies that perform property management services for the Company
and the Partnership; (vii) if applicable, oversee a non-affiliated Property
Manager and any other non-affiliated Persons who perform services for the
Company; and (viii) to the extent necessary, perform all other operational
functions for the maintenance and administration of such Property;

     (P) obtain the prior approval of the Board, any particular Directors
specified by the Board or any committee of the Board, as the case may be, for
any and all investments in Properties;

     (Q) negotiate on behalf of the Company and the Partnership with banks or
lenders for loans to be made to the Company, and negotiate on behalf of the
Company and the Partnership with investment banking firms and broker-dealers or
negotiate private sales of Shares and other securities or obtain loans

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for the Company and the Partnership, but in no event in such a way so that the
Advisor shall be acting as broker-dealer or underwriter; provided, further, that
any fees and costs payable to third parties incurred by the Advisor in
connection with the foregoing shall be the responsibility of the Company or the
Partnership;

     (R) on behalf of the Company and the Partnership, maintain, with respect to
any Property and to the extent available, title insurance or other assurance of
title and customary fire, casualty and public liability insurance;

     (S) obtain reports (which may be prepared by the Advisor or its
Affiliates), where appropriate, concerning the value of investments or
contemplated investments of the Company and the Partnership in Properties or
Real Estate Related Securities;

     (T) from time to time, or at any time reasonably requested by the Board,
provide information or make reports to the Board related to its performance of
services to the Company and the Partnership under this Agreement;

     (U) from time to time, or at any time reasonably requested by the Board,
make reports to the Board of the investment opportunities it has presented to
other Advisor-sponsored programs or that it has pursued directly or through an
Affiliate;

     (V) provide the Company and the Partnership with all necessary cash
management services;

     (W) deliver to or maintain on behalf of the Company copies of all
appraisals obtained in connection with the investments in Properties and all
valuations of Real Estate Related Securities as may be required to be obtained
by the Board;

     (X) notify the Board of all proposed material transactions before they are
completed;

     (Y) at the direction of Company management, prepare the Company's periodic
reports and other filings made under the Securities Exchange Act of 1934, as
amended, and the Company's Post-Effective Amendments to the Registration
Statement as well as all related prospectuses, prospectus supplements and
supplemental sales literature and assist in connection with the filing of such
documents with the appropriate regulatory authorities;

     (Z) supervise the preparation and filing and distribution of returns and
reports to governmental agencies and to investors and act on behalf of the
Company in connection with investor relations;

     (AA) effect any private placements of Shares or other interests in
Properties as may be approved by the Board;

     (BB) establish and maintain bank accounts on behalf of the Company and the
Partnership pursuant to Section 5 of this Agreement;

     (CC) provide office space, equipment and personnel as required for the
performance of the foregoing services as the Advisor; and

     (DD) do all things it reasonably deems necessary to assure its ability to
render the services described in this Agreement.

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     4. MODIFICATION OR REVOCATION OF AUTHORITY OF ADVISOR. The Board may, at
any time upon the giving of notice to the Advisor, modify or revoke the
authority or approvals set forth in Section 3; provided, however, that such
modification or revocation shall be effective upon receipt by the Advisor and
shall not be applicable to investment transactions to which the Advisor has
committed the Company and the Partnership prior to the date of receipt by the
Advisor of such notification.

     5. BANK ACCOUNTS. At the direction of the Board of Directors, the Advisor
may establish and maintain one or more bank accounts in its own name for the
account of the Company and the Partnership or in the name of the Company and the
Partnership and may collect and deposit into any such account or accounts, and
disburse from any such account or accounts, any money on behalf of the Company
and the Partnership, under such terms and conditions as the Board may approve,
provided that no funds shall be commingled with the funds of the Advisor; and
the Advisor shall from time to time render appropriate accountings of such
collections and payments to the Board and to the auditors of the Company.

     6. RECORDS; ACCESS. The Advisor shall maintain appropriate records of all
its activities hereunder and make such records available for inspection by the
Board and by counsel, auditors and authorized agents of the Company, at any time
or from time to time during normal business hours. The Advisor shall at all
reasonable times have access to the books and records of the Company and the
Partnership.

     7. LIMITATIONS ON ACTIVITIES. Anything else in this Agreement to the
contrary notwithstanding, the Advisor shall refrain from taking any action
which, in its sole judgment made in good faith, would (a) adversely affect the
status of the Company as a REIT, (b) subject the Company to regulation under the
Investment Company Act of 1940, as amended, or (c) violate any law, rule,
regulation or statement of policy of any governmental body or agency having
jurisdiction over the Company or the Partnership, its Shares or its other
securities, or otherwise not be permitted by the Articles of Incorporation or
Bylaws of the Company, except if such action shall be ordered by the Board, in
which case the Advisor shall notify promptly the Board of the Advisor's judgment
of the potential impact of such action and shall refrain from taking such action
until it receives further clarification or instructions from the Board. In such
event the Advisor shall have no liability for acting in accordance with the
specific instructions of the Board so given. Notwithstanding the foregoing, the
Advisor, its directors, officers, employees and stockholders, and stockholders,
directors and officers of the Advisor's Affiliates shall not be liable to the
Company, the Partnership, the Board or to the Stockholders for any act or
omission by the Advisor, its directors, officers, employees or stockholders, or
stockholders, directors or officers of the Advisor's Affiliates taken or omitted
to be taken in the performance of their duties under this Agreement except as
provided in Sections 19 and 20 of this Agreement.

     8. FEES.

     (A) REAL ESTATE COMMISSION. The Advisor or its Affiliates shall receive as
compensation for services rendered in connection with the investigation,
selection and acquisition of Properties (by purchase, investment or exchange) a
real estate commission payable by the Company (the "REAL ESTATE COMMISSION").
The total Real Estate Commission paid to the Advisor or its Affiliates for
services provided by the Advisor, its Affiliates or sub-contractors thereof
shall not exceed (i) three percent (3%) of the Contract Purchase Price of a
Property acquired directly or indirectly by the Company, and (ii) four percent
(4%) of the Total Development Cost of Properties developed by or on behalf of
the Company. At the Advisor's discretion, a portion of the Real Estate
Commission may be paid to third-party developers for services rendered. Real
Estate Commissions shall be payable on the acquisition of a specific Property,
on the acquisition of a portfolio of Properties through a purchase of assets,
controlling securities or by joint venture, by a merger or similar business
combination or other comparable transaction, or on the

                                      -10-

<PAGE>

completion of development of a Property or Properties for the Company. However,
the total of all Real Estate Commissions and Acquisition Expenses payable with
respect to any Properties shall not exceed six percent (6%) of the Contract
Purchase Price or the Total Development Cost (as applicable) of such Properties
unless fees in excess of such amount are approved by a majority of the Board of
Directors, including a majority of the Independent Directors.

     (B) ASSET MANAGEMENT FEE. Subject to the overall limitations contained
below in this Section 8(b), commencing on the Effective Date, the Advisor shall
be paid a monthly fee for the services rendered in connection with the
management of the Company's assets (the "ASSET MANAGEMENT FEE") in an amount
equal to (i) for Properties, one-twelfth of one percent (1%) of the Average
Invested Assets calculated as of the close of business on the last day of each
preceding month and (ii) for Real Estate Related Securities, one-twelfth of one
percent (1%) of the value of the Real Estate Related Securities under the
Advisor's management calculated as of the close of business on the last day of
each preceding month; provided, however, that the Company's obligation to pay
the Asset Management Fee shall be subject to the Stockholders receiving
annualized Distributions in an amount equal to five percent (5%) per annum of
Invested Capital (as such term is defined in the Articles of Incorporation). The
Asset Management Fee shall be payable by the Company in cash or in Shares at the
election of the Advisor in whole or in part, from time to time, by the Advisor
(without interest); provided, however, that the Company may object to the
Advisor's election and refuse to pay the Advisor in Shares if such payment would
result in a conflict with any provision of the Articles of Incorporation. If the
Advisor elects to receive the Asset Management Fee in the form of Shares and
such election does not conflict with any provision of the Articles of
Incorporation, then the Shares shall be valued at a price per share equal to the
average closing price of the Shares over the ten trading days immediately
preceding the date of such election if the Shares are Listed at such time. If
the Shares are not Listed and the Company is still in its Offering Stage at such
time, the Advisor will estimate the per share value of the Shares at a price per
share equal the most recent price paid to acquire a Share (excluding any Shares
sold at purchase price discounts for certain categories of purchasers). If the
Shares are not Listed and the Offering Stage has been completed for twelve (12)
months at such time, the Shares shall be valued at a price per share equal the
published annual estimated value of the shares as determined by the Advisor
based upon the Appraised Value of the Properties on the date of election.

     (C) DISPOSITION FEE. If the Advisor or an Affiliate of the Advisor provides
a substantial amount of the services (as determined by a majority of the
Independent Directors) in connection with the Sale of one or more Properties,
the Advisor or such Affiliate shall receive at closing a disposition fee equal
to the lessor of (i) three percent (3%) of the Contract Sales Price of such
Property or Properties, or (ii) fifty percent (50%) of a Competitive Real Estate
Commission given the circumstances surrounding the sale (the "DISPOSITION FEE").
In each case in which a Disposition Fee may be payable, the precise amount of
the fee within the limits set forth in the preceding sentence shall be
determined by the Board, including a majority of the Independent Directors,
based upon the extent of the services provided by the Advisor or its Affiliate
and market norms for the services provided. Notwithstanding anything to the
contrary herein, no Disposition Fee shall be payable to the Advisor or its
Affiliate for Property Sales if such Sales involve the Company selling all or
substantially all of its Properties in one or more transactions designed to
effectuate a business combination transaction (as opposed to a Company
liquidation, in which case the Disposition Fee would be payable if the Advisor
or an Affiliate provides a substantial amount of services as provided above).
Any Disposition Fee payable under this section may be paid in addition to real
estate commissions paid to non-Affiliates, provided that the total real estate
commissions (including such Disposition Fee) paid to all Persons by the Company
for each Property shall not exceed an amount equal to the lesser of (i) six
percent (6%) of the Contract Sales Price of the Property or (ii) the Competitive
Real Estate Commission for the Property.

     (D) PROPERTY MANAGEMENT FEE; LEASE-UP FEE. Either the Advisor, an Affiliate
of the Advisor or a non-affiliated third party as the Property Manager shall
receive a monthly property management fee equal to four percent (4%) of the
monthly Gross Income from each Property managed by such Property Manager (the
"PROPERTY MANAGEMENT FEE"). In addition, the Advisor, an Affiliate of the

                                      -11-

<PAGE>

Advisor or a non-affiliated third party as the Property Manager may receive a
separate fee for the one-time initial lease-up of newly constructed real
properties in an amount not to exceed the fee customarily charged in arm's
length transactions by others rendering similar services in the same geographic
area for similar properties, as determined by a survey of brokers and agents in
such area (the "LEASE-UP FEE"). The Lease-Up Fee is generally expected to range
from two percent (2%) to eight percent (8%) of the projected first years' annual
gross revenues of a property. However, the actual percentage is variable and
will depend on factors such as geographic location and real property type (i.e.
commercial office or medical office). In addition to the above Property
Management Fee and Lease-Up Fee, for each Property managed directly by a
non-affiliated Property Manager but where an Affiliate of the Advisor has
oversight responsibility over such non-affiliated Property Manager, the Company
will pay such Affiliate of the Advisor a monthly oversight fee of up to one
percent (1%) of the Gross Income from the Property.

     (E) CHANGES TO FEE STRUCTURE. In the event of a Listing, the Company and
the Advisor shall negotiate in good faith to establish a fee structure
appropriate for a perpetual-life entity.

     9. EXPENSES.

     (A) REIMBURSABLE EXPENSES. In addition to the compensation paid to the
Advisor pursuant to Section 8 hereof, the Company or the Partnership shall pay
directly or reimburse the Advisor for all of the expenses paid or incurred by
the Advisor (to the extent not reimbursable by another party, such as the dealer
manager) in connection with the services it provides to the Company and the
Partnership pursuant to this Agreement, including, but not limited to:

          (i) the Organizational and Offering Expenses; provided, however, that
within sixty (60) days after the end of the month in which an Offering
terminates, the Advisor shall reimburse the Company to the extent (i) Capped O&O
Expenses borne by the Company exceed the maximum amount permitted pursuant to
the prospectus for the Offering and (ii) Organizational and Offering Expenses
borne by the Company exceed fifteen percent (15%) of the Gross Offering Proceeds
raised in a completed Offering;

          (ii) Real Estate Commissions and Acquisition Expenses incurred in
connection with the selection and acquisition of Properties, subject to the
aggregate six percent (6%) cap on Real Estate Commissions and Acquisition
Expenses set forth in Section 8(a) above;

          (iii) the actual cost of goods and services used by the Company and
obtained from entities not affiliated with the Advisor, other than Acquisition
Expenses, including brokerage fees paid in connection with the purchase and sale
of Real Estate Related Securities;

          (iv) interest and other costs for borrowed money, including discounts,
points and other similar fees;

          (v) taxes and assessments on income of the Company or any of the
Properties;

                                      -12-

<PAGE>

          (vi) costs associated with insurance required in connection with the
business of the Company or by the Board;

          (vii) expenses of managing and operating Properties owned by the
Company, whether payable to an Affiliate of the Company or a non-affiliated
Person;

          (viii) all compensation and expenses payable to the Independent
Directors and all expenses payable to the non-Independent Directors in
connection with their services to the Company and the Stockholders and their
attendance at meetings of the Directors and the Stockholders;

          (ix) expenses associated with Listing or with the issuance and
distribution of securities other than the Shares, such as selling commissions
and fees, advertising expenses, taxes, legal and accounting fees, listing and
registration fees;

          (x) expenses connected with payments of Distributions in cash or
otherwise made or caused to be made by the Company to the Stockholders;

          (xi) expenses of organizing, redomesticating, merging, liquidating or
dissolving the Company or of amending the Articles of Incorporation or the
Bylaws;

          (xii) expenses of maintaining communications with Stockholders or
their financial advisors, including the cost of preparation, printing, and
mailing annual reports and other Stockholder reports, proxy statements and other
reports required by governmental entities;

          (xiii) administrative service expenses (including (a) personnel costs;
provided, however, that no reimbursement shall be made for costs of personnel to
the extent that such personnel perform services in transactions for which the
Advisor receives a separate fee, and (b) the Company's allocable share of other
overhead of the Advisor such as rent and utilities);

          (xiv) transfer agent and registrar's fees and charges paid to third
parties;

          (xv) expenses associated with the disposition of Properties,
including, subject to Section 8(c), real estate commissions;

          (xvi) audit, accounting, legal and other professional fees; and

          (xvii) all other costs and expenses in any way relating to the
operations of the Company or the Partnership or the business of the Company or
the Partnership (other than any fees payable to the Advisor or its Affiliates).

     (B) OTHER SERVICES. Should the Board request that the Advisor, any
Affiliate of the Advisor or any director, officer or employee thereof render
services for the Company and the Partnership other than set forth in Section 3,
such additional services, if the Advisor elects to perform them, shall be
separately compensated at such rates and in such amounts as are agreed by the
Advisor and the Board, including a majority of the Independent Directors,
subject to the limitations contained in the Articles of Incorporation, shall not
exceed an amount that would be paid to nonaffiliated third parties for similar
services, and shall not be deemed to be services pursuant to the terms of this
Agreement.

     (C) TIMING OF AND LIMITATIONS ON REIMBURSEMENTS.

          (i) Expenses incurred by the Advisor on behalf of the Company and the
Partnership and payable pursuant to this Section 9 shall be reimbursed no less
than monthly to the Advisor. The

                                      -13-

<PAGE>

Advisor shall prepare a statement documenting the expenses of the Company and
the Partnership during each quarter, and shall deliver such statement to the
Company and the Partnership within forty-five (45) days after the end of each
quarter.

          (ii) Notwithstanding anything else in this Section 9 to the contrary,
the expenses enumerated in this Section 9 shall not become reimbursable out of
the proceeds of an Offering to the Advisor unless and until the Company has
raised the minimum offering amount, if any, as provided in the prospectus for
the Offering.

          (iii) The Company shall not reimburse the Advisor at the end of any
fiscal quarter Operating Expenses that, in the four consecutive fiscal quarters
then ended (the "EXPENSE YEAR") exceed (the "EXCESS AMOUNT") the 2%/25%
Guidelines for such year unless a majority of the Independent Directors
determines that such excess was justified, based on unusual and nonrecurring
factors which a majority of the Independent Directors deems sufficient. If a
majority of the Independent Directors does not approve such excess as being so
justified, any Excess Amount paid to the Advisor during a fiscal quarter shall
be repaid to the Company. If a majority of the Independent Directors determines
such excess was justified, then within sixty (60) days after the end of any
fiscal quarter of the Company for which total reimbursed Operating Expenses for
the Expense Year exceed the 2%/25% Guidelines, the Advisor, at the direction of
a majority of the Independent Directors, shall send to the Stockholders a
written disclosure of such fact, together with an explanation of the factors the
Independent Directors considered in determining that such excess expenses were
justified. The Company will ensure that such determination will be reflected in
the minutes of the meetings of the Board of Directors. All figures used in the
foregoing computation shall be determined in accordance with generally accepted
accounting principles applied on a consistent basis.

          (iv) The foregoing reimbursements of expenses, as limited by this
Agreement, will be made regardless of whether any cash distributions are made to
the Stockholders.

     10. STATEMENTS. The Advisor shall furnish to the Company not later than the
thirtieth (30th) day following the end of each Fiscal Year, a statement showing
a computation of the fees or other compensation payable to the Advisor or an
Affiliate of the Advisor with respect to such Fiscal Year under Sections 8 and 9
hereof. The final settlement of compensation payable under Sections 8 and 9
hereof for each Fiscal Year shall be subject to adjustments in accordance with,
and upon completion of, the annual audit of the Company's financial statements.

     11. INTERNALIZATION OF THE ADVISOR. In the event that the Company's assets
and income are, in the view of the Board of Directors, including a majority of
the Independent Directors, of sufficient size such that internalizing the
management functions by the Advisor and the Property Manager is in the best
interests of the Stockholders, the compensation payable to the Advisor upon such
internalization shall be agreed upon by the Independent Directors and the
Advisor.

     12. OTHER ACTIVITIES OF THE ADVISOR. Nothing herein contained shall prevent
the Advisor from engaging in other activities, including, without limitation,
the rendering of advice to other Persons (including other REITs) and the
management of other programs advised, sponsored or organized by the Advisor or
its Affiliates; nor shall this Agreement limit or restrict the right of any
director, officer, employee, or stockholder of the Advisor or its Affiliates to
engage in any other business or to render services of any kind to any other
partnership, corporation, firm, individual, trust or association. The Advisor
may, with respect to any investment in which the Company or the Partnership is a
participant, also render advice and service to each and every other participant
therein. The Advisor shall report to the Board the existence of any condition or
circumstance, existing or anticipated, of which it has knowledge, which creates
or could create a conflict of interest between the Advisor's obligations to the
Company and

                                      -14-

<PAGE>

the Partnership and its obligations to or its interest in any other partnership,
corporation, firm, individual, trust or association.

     13. INFORMATION FURNISHED TO THE ADVISOR. The Board of Directors will keep
the Advisor informed concerning the investment and financing policies of the
Company. The Board of Directors shall notify the Advisor promptly of its
intention to make any investments or to sell or dispose of any existing
investments. Upon request of the Advisor, the Company shall furnish the Advisor
with a certified copy of any Company financial statements, a signed copy of each
report prepared by independent certified public accountants, and such other
information with regard to its affairs as the Advisor may reasonably request.

     14. RELATIONSHIP OF ADVISOR AND COMPANY. The Company, the Partnership and
the Advisor are not partners or joint venturers with each other, and nothing in
this Agreement shall be construed to make them such partners or joint venturers
or impose any liability as such on either of them.

     15. TERM; RENEWAL OF AGREEMENT. This Agreement shall continue in force
until the first anniversary of the Effective Date, subject to an unlimited
number of successive one-year renewals upon mutual consent of the parties. The
Company, acting through the Board, will evaluate the performance of the Advisor
annually before renewing the Agreement, and each such renewal shall be for a
term of no more than one year.

     16. TERMINATION.

     (A) BY EITHER PARTY. This Agreement may be terminated upon sixty (60) days
written notice without cause or penalty, by either party (if by the Company,
only upon approval of a majority of the Independent Directors).

     (B) BY THE COMPANY. At the sole option of the Company, this Agreement shall
be terminated immediately, subject to the thirty (30)-day cure period for a "for
Cause" termination due to a material breach of this Agreement, upon written
notice of termination from the Board of Directors to the Advisor if any of the
following events occur:

          (i) For Cause;

          (ii) A court of competent jurisdiction enters a decree or order for
relief in respect of the Advisor in any involuntary case under the applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, or
appoints a receiver, liquidator, assignee, custodian, trustee, sequestrator (or
similar official) of the Advisor or for any substantial part of its property or
orders the winding up or liquidation of the Advisor's affairs; or

          (iii) The Advisor commences a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, or
consents to the entry of an order for relief in an involuntary case under any
such law, or consents to the appointment of or taking possession by a receiver,
liquidator, assignee, custodian, trustee, sequestrator (or similar official) of
the Advisor or for any substantial part of its property, or makes any general
assignment for the benefit of creditors, or fails generally to pay its debts as
they become due.

     The Advisor agrees that if any of the events specified in subsections (ii)
or (iii) of this Section 16(b) occur, it will give written notice thereof to the
Company within seven (7) days after the occurrence of such event.

                                      -15-

<PAGE>

     (C) BY THE ADVISOR. At the sole option of the Advisor, this Agreement shall
be terminated immediately, subject to the thirty (30)-day cure period for a
"Good Reason" termination due to a material breach of this Agreement, upon
written notice of termination from the Advisor to the Company that the Advisor
has Good Reason to terminate this Agreement.

     (D) SURVIVAL. The provisions of Sections 18 through 31 shall survive
termination of this Agreement.

     17. ASSIGNMENT. This Agreement shall not be assigned by the Advisor to a
non-Affiliate. This Agreement may be assigned by the Advisor to an Affiliate
with the approval of the Board, including a majority of the Independent
Directors. Notwithstanding the foregoing, the Advisor may assign any rights to
receive fees or other payments under this Agreement without obtaining the
approval of the Board. This Agreement shall not be assigned by the Company or
the Partnership without the consent of the Advisor, except in the case of an
assignment by the Company or the Partnership to a corporation or other
organization which is a successor to all of the assets, rights and obligations
of the Company or the Partnership, as the case may be, in which case such
successor organization shall be bound hereunder and by the terms of said
assignment in the same manner as the Company and the Partnership is bound by
this Agreement.

     18. PAYMENTS TO AND DUTIES OF ADVISOR UPON TERMINATION. Payments to the
Advisor pursuant to this Section 18 shall be subject to the 2%/25% Guidelines to
the extent applicable.

     (A) After the Termination Date, the Advisor shall not be entitled to
compensation for further services hereunder except it shall be entitled to
receive from the Company within thirty (30) days after the effective date of
such termination all unpaid reimbursements of expenses and all earned but unpaid
fees payable to the Advisor prior to termination of this Agreement; and

     (B) The Advisor shall promptly upon termination:

          (i) pay over to the Company all money collected and held for the
account of the Company pursuant to this Agreement, after deducting any accrued
compensation and reimbursement for its expenses to which it is then entitled;

          (ii) deliver to the Board a full accounting, including a statement
showing all payments collected by it and a statement of all money held by it,
covering the period following the date of the last accounting furnished to the
Board;

          (iii) deliver to the Board all assets, including Properties and Real
Estate Related Securities, and documents of the Company then in the custody of
the Advisor; and

          (iv) cooperate with the Company to provide an orderly management
transition.

     19. INDEMNIFICATION BY THE COMPANY.

     (A) The Company shall indemnify and hold harmless the Advisor and its
Affiliates, including their respective officers, directors, partners and
employees, from all liability, claims, damages or losses arising in the
performance of their duties hereunder, and related expenses, including
reasonable attorneys' fees, to the extent such liability, claims, damages or
losses and related expenses are not fully reimbursed by insurance, subject to
any limitations imposed by the laws of the State of Maryland or the Articles of
Incorporation.

                                      -16-

<PAGE>

     (B) The Company may advance amounts to persons entitled to indemnification
hereunder for legal and other expenses and costs incurred as a result of any
legal action for which indemnification is being sought only if all of the
following conditions are satisfied: (i) the legal action relates to acts or
omissions with respect to the performance of duties or services by the
indemnified party for or on behalf of the Company; (ii) the legal action is
initiated by a third party and a court of competent jurisdiction specifically
approves such advancement; and (iii) the indemnified party receiving such
advances undertakes to repay the advanced funds to the Company, together with
the applicable legal rate of interest thereon, in which such party would not be
entitled to indemnification.

     (C) Notwithstanding the foregoing, the Advisor shall not be entitled to
indemnification or be held harmless pursuant to this Section 19 for any activity
which the Advisor shall be required to indemnify or hold harmless the Company
pursuant to Section 20. Any indemnification of the Advisor may be made only out
of the net assets of the Company and not from the Stockholders.

     20. INDEMNIFICATION BY ADVISOR. The Advisor shall indemnify and hold
harmless the Company from contract or other liability, claims, damages, taxes or
losses and related expenses, including attorneys' fees, to the extent that such
liability, claims, damages, taxes or losses and related expenses are not fully
reimbursed by insurance and are incurred by reason of the Advisor's bad faith,
fraud, willful misfeasance, misconduct, or reckless disregard of its duties, but
the Advisor shall not be held responsible for any action of the Board in
following or declining to follow advice or recommendation given by the Advisor.

     21. FIDELITY BOND. The Advisor shall not be required to obtain or maintain
a fidelity bond in connection with the performance of its services hereunder.

     22. NOTICES. Any notice, report or other communication required or
permitted to be given hereunder shall be in writing unless some other method of
giving such notice, report or other communication is required by the Articles of
Incorporation, the Bylaws, or accepted by the party to whom it is given, and
shall be given by being delivered by hand or by overnight mail or other
overnight delivery service to the addresses set forth herein:

To the Board and to the Company:   NNN Healthcare/Office REIT, Inc.
                                   Suite 200
                                   1551 N. Tustin Avenue
                                   Santa Ana, CA 92705
                                   Attention: Chief Executive Officer

To the Partnership:                NNN Healthcare/Office REIT Holdings, L.P.
                                   Suite 200
                                   1551 N. Tustin Avenue
                                   Santa Ana, CA 92705
                                   Attention: Chief Executive Officer of
                                              NNN Healthcare/Office REIT, Inc.,
                                              its General Partner

To the Advisor:                    NNN Healthcare/Office REIT Advisor, LLC
                                   Suite 200
                                   1551 N. Tustin Avenue
                                   Santa Ana, CA 92705
                                   Attention: Chief Executive Officer

     Either party may at any time give notice in writing to the other party of a
change in its address for the purposes of this Section 22.

                                      -17-

<PAGE>

     23. AMENDMENTS. This Agreement shall not be changed, modified, terminated,
or discharged, in whole or in part, except by an instrument in writing signed by
each of the parties hereto, or their respective successors or assignees.

     24. SEVERABILITY. The provisions of this Agreement are independent of and
severable from each other, and no provision shall be affected or rendered
invalid or unenforceable by virtue of the fact that for any reason any other or
others of them may be invalid or unenforceable in whole or in part.

     25. CONSTRUCTION. The provisions of this Agreement shall be construed and
interpreted in accordance with the laws of the State of Maryland.

     26. ENTIRE AGREEMENT. This Agreement contains the entire agreement and
understanding among the parties hereto with respect to the subject matter
hereof, and supersedes all prior and contemporaneous agreements, understandings,
inducements and conditions, express or implied, oral or written, of any nature
whatsoever with respect to the subject matter hereof. The express terms hereof
control and supersede any course of performance and/or usage of the trade
inconsistent with any of the terms hereof. This Agreement may not be modified or
amended other than by an agreement in writing.

     27. INDULGENCES, NOT WAIVER. Neither the failure nor any delay on the part
of a party to exercise any right, remedy, power or privilege under this
Agreement shall operate as a waiver thereof, nor shall any single or partial
exercise of any right, remedy, power or privilege preclude any other or further
exercise of the same or of any other right, remedy, power or privilege, nor
shall any waiver of any right, remedy, power or privilege with respect to any
occurrence be construed as a waiver of such right, remedy, power or privilege
with respect to any other occurrence. No waiver shall be effective unless it is
in writing and is signed by the party asserted to have granted such waiver.

     28. GENDER. Words used herein regardless of the number and gender
specifically used, shall be deemed and construed to include any other number,
singular or plural, and any other gender, masculine, feminine or neuter, as the
context requires.

     29. TITLES NOT TO AFFECT INTERPRETATION. The titles of sections and
subsections contained in this Agreement are for convenience only, and they
neither form a part of this Agreement nor are they to be used in the
construction or interpretation hereof.

     30. EXECUTION IN COUNTERPARTS. This Agreement may be executed in any number
of counterparts, each of which shall be deemed to be an original as against any
party whose signature appears thereon, and all of which shall together
constitute one and the same instrument. This Agreement shall become binding when
the counterparts hereof, taken together, bear the signatures of all of the
parties reflected hereon as the signatories.

     31. NAME. NNN Healthcare/Office REIT Advisor, LLC has a proprietary
interest in the name "NNN." Accordingly, and in recognition of this right, if at
any time the Company or the Partnership ceases to retain NNN Healthcare/Office
REIT Advisor, LLC or an Affiliate thereof to perform the services of the Advisor
under this Agreement, the Company or the Partnership, as the case may be, will,
promptly after receipt of written request from NNN Healthcare/Office REIT
Advisor, LLC, cease to conduct business under or use the name "NNN" or any
variation or derivative thereof and the Company and the Partnership shall each
use its best efforts to change their respective names (and the names of any of
their Affiliates) to a name that does not contain the name "NNN" or any other
word or words that might, in the sole discretion of the Advisor, be susceptible
of indication of some form of relationship between the Company and the Advisor
or any Affiliate thereof. Consistent with the foregoing, the parties acknowledge
and agree that the Advisor or one or more of its Affiliates has in the past and
may in the

                                      -18-

<PAGE>

future organize, sponsor or otherwise permit to exist other investment vehicles
(including vehicles for investment in real estate) and financial and service
organizations having "NNN" as a part of their name, all without the need for any
consent (and without the right to object thereto) by the Company or its Board.

     32. RIGHT OF FIRST REFUSAL. In the event that Triple Net identifies an
opportunity to make an investment in one or more office buildings or other
facilities for which greater than fifty percent (50%) of the gross rentable
space at such office buildings or other facilities is leased to, or is
reasonably expected to be leased to, one or more medical or healthcare-related
tenants, either directly or indirectly through an Affiliate or in a joint
venture or other co-ownership arrangement, for itself or for any other Triple
Net-sponsored or managed program, then Triple Net agrees that it shall provide
the Company with the first opportunity to purchase such investment and that it
shall provide all necessary information to the Advisor in order to enable the
Board of Directors to determine whether to proceed with such investment. The
Advisor shall present such information to the Board of Directors within three
(3) business days of receipt from Triple Net. In the event that the Board of
Directors does not affirmatively authorize the Advisor to proceed with the
investment on behalf of the Company within seven (7) days of receipt of such
information from the Advisor, then Triple Net may proceed with the investment
opportunity for its own account or offer the investment opportunity to any other
person or entity.

                        [SIGNATURES APPEAR ON NEXT PAGE]

                                      -19-

<PAGE>

     IN WITNESS WHEREOF, the parties hereto have executed this Advisory
Agreement as of the day and year first above written.

                                       NNN HEALTHCARE/OFFICE REIT, INC.

                                       By:
                                           -------------------------------------
                                       Name:
                                             -----------------------------------
                                       Title:
                                              ----------------------------------

                                       NNN HEALTHCARE/OFFICE REIT HOLDINGS, L.P.

                                       By: NNN Healthcare/Office REIT, Inc.,
                                           its General Partner

                                       By:
                                           -------------------------------------
                                       Name:
                                             -----------------------------------
                                       Title:
                                              ----------------------------------

                                       NNN HEALTHCARE/OFFICE REIT ADVISOR, LLC

                                       By:
                                           -------------------------------------
                                       Name:
                                             -----------------------------------
                                       Title:
                                              ----------------------------------

                                       TRIPLE NET PROPERTIES, LLC
                                       (solely for purposes of Section 32 of
                                       this Agreement)

                                       By:
                                           -------------------------------------
                                       Name:
                                             -----------------------------------
                                       Title:
                                              ----------------------------------

                     [SIGNATURE PAGE TO ADVISORY AGREEMENT]exv10w1

 

CREDIT Agreement *

Dated as of June 30, 2006

among

PHILADELPHIA
CONSOLIDATED HOLDING CORP.

as the Borrower,

BANK
OF AMERICA, N.A.,

as the Administrative Agent,

and

The Other Lenders Party Hereto

WACHOVIA BANK, NATIONAL ASSOCIATION,

as

Documentation Agent

BANC OF AMERICA SECURITIES LLC,

as

Sole Lead Arranger and Sole Book Manager

 

			
	*	 	Conformed to reflect signatures.

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	                                                    Section	 	Page	 
	ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS
	 	 	1	 
	1.01 Defined Terms
	 	 	1	 
	1.02 Other Interpretive Provisions
	 	 	14	 
	1.03 Accounting Terms
	 	 	14	 
	1.04 Rounding
	 	 	15	 
	1.05 Times of Day
	 	 	15	 
	 
	 	 	 	 
	ARTICLE II. THE COMMITMENTS
	 	 	15	 
	2.01 Loans
	 	 	15	 
	2.02 Borrowings, Conversions and Continuations of Loans
	 	 	15	 
	2.03 Prepayments
	 	 	17	 
	2.04 Termination or Reduction of Commitments
	 	 	17	 
	2.05 Repayment of Loans
	 	 	17	 
	2.06 Interest
	 	 	17	 
	2.07 Commitment Fee
	 	 	18	 
	2.08 Computation of Interest and Fees
	 	 	18	 
	2.09 Evidence of Debt
	 	 	19	 
	2.10 Payments Generally; Administrative Agent’s Clawback
	 	 	19	 
	2.11 Sharing of Payments by Lenders
	 	 	21	 
	 
	 	 	 	 
	ARTICLE III. TAXES, YIELD PROTECTION AND ILLEGALITY
	 	 	21	 
	3.01 Taxes
	 	 	21	 
	3.02 Illegality
	 	 	23	 
	3.03 Inability to Determine Rates
	 	 	24	 
	3.04 Increased Costs; Reserves on Eurodollar Rate Loans
	 	 	24	 
	3.05 Compensation for Losses
	 	 	25	 
	3.06 Mitigation Obligations; Replacement of Lenders
	 	 	26	 
	3.07 Survival
	 	 	26	 
	 
	 	 	 	 
	ARTICLE IV. CONDITIONS PRECEDENT TO BORROWINGS
	 	 	27	 
	4.01 Conditions of Initial Borrowing
	 	 	27	 
	4.02 Conditions to all Borrowings
	 	 	28	 
	 
	 	 	 	 
	ARTICLE V. REPRESENTATIONS AND WARRANTIES
	 	 	28	 
	5.01 Existence, Qualification and Power; Compliance with Laws
	 	 	28	 
	5.02 Authorization; No Contravention
	 	 	29	 
	5.03 Governmental Authorization; Other Consents
	 	 	29	 
	5.04 Binding Effect
	 	 	29	 
	5.05 Financial Statements; No Material Adverse Effect
	 	 	29	 
	5.06 Litigation
	 	 	30	 
	5.07 No Default
	 	 	30	 
	5.08 Ownership of Property; Liens
	 	 	30	 
	5.09 Environmental Compliance
	 	 	30	 
	5.10 Insurance
	 	 	30	 
	5.11 Taxes
	 	 	30	 

	 	 	 
	 	i	Credit Agreement

 

	 	 	 	 	 
	                                                                                        Section	 	Page	 
	5.12 ERISA Compliance
	 	 	31	 
	5.13 Subsidiaries
	 	 	31	 
	5.14 Margin Regulations; Investment Company Act; Public Utility Holding
Company Act
	 	 	31	 
	5.15 Disclosure
	 	 	32	 
	5.16 Compliance with Laws
	 	 	32	 
	5.17 Intellectual Property; Licenses, Etc
	 	 	32	 
	5.18 Insurance Licenses
	 	 	32	 
	 
	 	 	 	 
	ARTICLE VI. AFFIRMATIVE COVENANTS
	 	 	33	 
	6.01 Financial Statements
	 	 	33	 
	6.02 Certificates; Other Information
	 	 	34	 
	6.03 Notices
	 	 	35	 
	6.04 Payment of Obligations
	 	 	35	 
	6.05 Preservation of Existence, Etc
	 	 	35	 
	6.06 Maintenance of Properties
	 	 	36	 
	6.07 Maintenance of Insurance
	 	 	36	 
	6.08 Compliance with Laws
	 	 	36	 
	6.09 Books and Records
	 	 	36	 
	6.10 Inspection Rights
	 	 	36	 
	6.11 Use of Proceeds
	 	 	36	 
	 
	 	 	 	 
	ARTICLE VII. NEGATIVE COVENANTS
	 	 	37	 
	7.01 Liens
	 	 	37	 
	7.02 Indebtedness
	 	 	38	 
	7.03 Fundamental Changes
	 	 	38	 
	7.04 Change in Nature of Business
	 	 	39	 
	7.05 Transactions with Affiliates
	 	 	39	 
	7.06 Contractual Limitation on Restricted Payments
	 	 	39	 
	7.07 Use of Proceeds
	 	 	39	 
	7.08 Financial Covenants
	 	 	39	 
	 
	 	 	 	 
	ARTICLE VIII. EVENTS OF DEFAULT AND REMEDIES
	 	 	40	 
	8.01 Events of Default
	 	 	40	 
	8.02 Remedies Upon Event of Default
	 	 	42	 
	8.03 Application of Funds
	 	 	42	 
	 
	 	 	 	 
	ARTICLE IX. ADMINISTRATIVE AGENT
	 	 	43	 
	9.01 Appointment and Authority
	 	 	43	 
	9.02 Rights as a Lender
	 	 	43	 
	9.03 Exculpatory Provisions
	 	 	43	 
	9.04 Reliance by Administrative Agent
	 	 	44	 
	9.05 Delegation of Duties
	 	 	44	 
	9.06 Resignation of Administrative Agent
	 	 	45	 
	9.07 Non-Reliance on Administrative Agent and Other Lenders
	 	 	45	 
	9.08 No Other Duties, Etc
	 	 	45	 
	9.09 Administrative Agent May File Proofs of Claim
	 	 	46	 

	 	 	 
	 	ii	Credit Agreement

 

	 	 	 	 	 
	                                                Section	 	Page	 
	ARTICLE X. MISCELLANEOUS
	 	 	46	 
	10.01 Amendments, Etc
	 	 	46	 
	10.02 Notices; Effectiveness; Electronic Communication
	 	 	47	 
	10.03 No Waiver; Cumulative Remedies
	 	 	49	 
	10.04 Expenses; Indemnity; Damage Waiver
	 	 	49	 
	10.05 Payments Set Aside
	 	 	50	 
	10.06 Successors and Assigns
	 	 	51	 
	10.07 Treatment of Certain Information; Confidentiality
	 	 	53	 
	10.08 Right of Setoff
	 	 	54	 
	10.09 Interest Rate Limitation
	 	 	55	 
	10.10 Counterparts; Integration; Effectiveness
	 	 	55	 
	10.11 Survival of Representations and Warranties
	 	 	55	 
	10.12 Severability
	 	 	55	 
	10.13 Replacement of Lenders
	 	 	56	 
	10.14 Governing Law; Jurisdiction; Etc
	 	 	56	 
	10.15 Waiver of Jury Trial
	 	 	57	 
	10.16 USA PATRIOT Act Notice
	 	 	57	 
	10.17 No Advisory or Fiduciary Responsibility
	 	 	58	 
	 
	 	 	 	 
	SIGNATURES 
	 	 	S-1	 

 	 	 	 
	 	iii	Credit Agreement

 

SCHEDULES

	 	 	 
	2.01

	 	Commitments and Applicable Percentages
	5.06

	 	Litigation
	5.13

	 	Subsidiaries
	7.02

	 	Existing Consolidated Funded Indebtedness
	10.02

	 	Administrative Agent’s Office; Certain Addresses for Notices
	10.06

	 	Processing and Recordation Fees

EXHIBITS

	 	 	 
	 

	 	Form of
	 
	 	 
	A

	 	Loan Notice
	B

	 	Note
	C

	 	Compliance Certificate
	D

	 	Assignment and Assumption

	 	 	 
	 	iv	Credit Agreement

 

CREDIT AGREEMENT

     This CREDIT AGREEMENT (“Agreement”) is entered into as of June 30, 2006, among
PHILADELPHIA CONSOLIDATED HOLDING CORP., a Pennsylvania corporation (the “Borrower”), each
lender from time to time party hereto (collectively, the “Lenders” and individually, a
“Lender”), and BANK OF AMERICA, N.A., as Administrative Agent.

     The Borrower has requested that the Lenders provide a revolving credit facility, and the
Lenders are willing to do so on the terms and conditions set forth herein.

     In consideration of the mutual covenants and agreements herein contained, the parties hereto
covenant and agree as follows:

ARTICLE I.

DEFINITIONS AND ACCOUNTING TERMS

     1.01 Defined Terms. As used in this Agreement, the following terms shall have the meanings
set forth below:

     “Act” has the meaning specified in Section 10.16.

     “Administrative Agent” means Bank of America in its capacity as administrative agent
under any of the Loan Documents, or any successor administrative agent.

     “Administrative Agent’s Office” means the Administrative Agent’s address and, as
appropriate, account as set forth on Schedule 10.02, or such other address or account as
the Administrative Agent may from time to time notify to the Borrower and the Lenders.

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

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

     “Aggregate Commitments” means the Commitments of all the Lenders.

     “Agreement” means this Credit Agreement.

     “Annual Statement” means, as to any Insurance Subsidiary, the annual financial
statement of such Insurance Subsidiary as required to be filed with the applicable Department,
together with all exhibits or schedules filed therewith, prepared in conformity with SAP.

     “Applicable Insurance Code” means, as to any Insurance Subsidiary, the insurance code
of any state where such Insurance Subsidiary is domiciled or doing insurance business.

     “Applicable Percentage” means with respect to any Lender at any time, the percentage
(carried out to the ninth decimal place) of the Aggregate Commitments represented by such

 	 	 	 
	 	1	Credit Agreement

 

Lender’s Commitment at such time. If the commitment of each Lender to make Loans has been
terminated pursuant to Section 8.02 or if the Aggregate Commitments have expired, then the
Applicable Percentage of each Lender shall be determined based on the Applicable Percentage of such
Lender most recently in effect, giving effect to any subsequent assignments. The initial
Applicable Percentage of each Lender is set forth opposite the name of such Lender on Schedule
2.01 or in the Assignment and Assumption pursuant to which such Lender becomes a party hereto,
as applicable.

     “Approved Fund” means any Fund that is administered or managed by (a) a Lender, (b) an
Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a
Lender.

     “Arranger” means Banc of America Securities LLC, in its capacity as sole lead arranger
and sole book manager.

     “Assignee Group” means two or more Eligible Assignees that are Affiliates of one
another or two or more Approved Funds managed by the same investment advisor.

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

     “Attributable Indebtedness” means, on any date, (a) in respect of any capital lease of
any Person, the capitalized amount thereof that would appear on a balance sheet of such Person
prepared as of such date in accordance with GAAP and (b) in respect of any Synthetic Lease
Obligation, the capitalized amount of the remaining lease payments under the relevant lease that
would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP if
such lease were accounted for as a capital lease.

     “Audited Financial Statements” means the audited consolidated balance sheet of the
Borrower and its Subsidiaries for the fiscal year ended December 31, 2005, and the related
consolidated statements of income or operations, shareholders’ equity and cash flows for such
fiscal year of the Borrower and its Subsidiaries, including the notes thereto.

     “Availability Period” means the period from and including the Closing Date to the
earliest of (a) the Maturity Date, (b) the date of termination of the Aggregate Commitments
pursuant to Section 2.04 and (c) the date of termination of the commitment of each Lender
to make Loans pursuant to Section 8.02.

     “Bank of America” means Bank of America, N.A. and its successors.

     “Base Rate” means for any day a fluctuating rate per annum equal to the
higher of (a) the Federal Funds Rate plus 1/2 of 1% and (b) the rate of interest in effect
for such day as publicly announced from time to time by Bank of America as its “prime rate.” The
“prime rate” is a rate set by Bank of America based upon various factors including Bank of
America’s costs and desired return, general economic conditions and other factors, and is used as a
reference point for pricing some loans, which may be priced at, above, or below such announced
rate. Any change

 	 	 	 
	 	2	Credit Agreement

 

in such rate announced by Bank of America shall take effect at the opening of business on the
day specified in the public announcement of such change.

     “Base Rate Loan” means a Loan that bears interest based on the Base Rate.

     “Borrower” has the meaning specified in the introductory paragraph hereto.

     “Borrower Materials” has the meaning specified in Section 6.02.

     “Borrowing” means a borrowing consisting of simultaneous Loans of the same Type and,
in the case of Eurodollar Rate Loans, having the same Interest Period made by each of the Lenders
pursuant to Section 2.01.

     “Business Day” means any day other than a Saturday, Sunday or other day on which
commercial banks are authorized to close under the Laws of, or are in fact closed in, the state
where the Administrative Agent’s Office is located and, if such day relates to any Eurodollar Rate
Loan, means any such day on which dealings in Dollar deposits are conducted by and between banks in
the London interbank eurodollar market.

     “Change in Law” means the occurrence, after the date of this Agreement, of any of the
following: (a) the adoption or taking effect of any Law, (b) any change in any Law or in the
administration, interpretation or application thereof by any Governmental Authority or (c) the
making or issuance of any request, guideline or directive (whether or not having the force of law)
by any Governmental Authority.

     “Change of Control” means an event or series of events by which:

     (a) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, but excluding (i) any employee benefit plan of such person
or its subsidiaries, and any person or entity acting in its capacity as trustee, agent or
other fiduciary or administrator of any such plan, and (ii) James J. Maguire and James J.
Maguire, Jr. and any such “person” or “group” that is directly or indirectly Controlled by
either or both of them), other than any such “person” or “group” that is such a “beneficial
owner” on the date of this Agreement, becomes the “beneficial owner” (as defined in Rules
13d-3 and 13d-5 under the Securities Exchange Act of 1934, except that a person or group
shall be deemed to have “beneficial ownership” of all securities that such person or group
has the right to acquire (such right, an “option right”), whether such right is
exercisable immediately or only after the passage of time), directly or indirectly, of 35%
or more of the equity securities of the Borrower entitled to vote for members of the board
of directors or equivalent governing body of the Borrower on a fully-diluted basis (and
taking into account all such securities that such person or group has the right to acquire
pursuant to any option right); or

     (b) either of PIC or PIIC ceases to be a wholly-owned Subsidiary of the Borrower.

     “Closing Date” means the first date all the conditions precedent in Section
4.01 are satisfied or waived in accordance with Section 10.01.

	 	 	 
	 	3	Credit Agreement

 

     “Code” means the Internal Revenue Code of 1986.

     “Commitment” means, as to each Lender, its obligation to make Loans to the Borrower
pursuant to Section 2.01 in an aggregate principal amount at any one time outstanding not
to exceed the amount set forth opposite such Lender’s name on Schedule 2.01 or in the
Assignment and Assumption pursuant to which such Lender becomes a party hereto, as applicable, as
such amount may be adjusted from time to time in accordance with this Agreement.

     “Compliance Certificate” means a certificate substantially in the form of Exhibit
C.

     “Consolidated Funded Indebtedness” means, as of any date of determination, for the
Borrower and its Subsidiaries on a consolidated basis, the sum, without duplication, of (a) the
outstanding principal amount of all obligations, whether current or long-term, for borrowed money
(including Obligations hereunder) and all obligations evidenced by bonds, debentures, notes, loan
agreements or other similar instruments, (b) all purchase money indebtedness, (c) all direct
obligations arising under letters of credit (including standby and commercial) that have been drawn
but not reimbursed by the Person for whose account such letters of credit were issued, bankers’
acceptances, bank guaranties, surety bonds and similar instruments, (d) all obligations in respect
of the deferred purchase price of property or services (other than trade accounts payable in the
ordinary course of business), (e) Attributable Indebtedness in respect of capital leases and
Synthetic Lease Obligations, (f) the Swap Termination Value of all Swap Contracts, (g) all
Consolidated Funded Indebtedness secured by a Lien on any asset of the Borrower or any of its
Subsidiaries, whether or not such Consolidated Funded Indebtedness is otherwise an obligation of
the Borrower or any of its Subsidiaries, (h) all Guarantees with respect to Consolidated Funded
Indebtedness of Persons other than the Borrower or any of its Subsidiaries and (i) all Consolidated
Funded Indebtedness of any partnership or joint venture (other than a joint venture that is itself
a corporation, limited liability company or limited partnership) in which the Borrower or any of
its Subsidiaries is a general partner or joint venturer, unless such Consolidated Funded
Indebtedness is expressly made non-recourse to such partnership or joint venture or is expressly
made non-recourse to the Borrower or such Subsidiary.

     “Consolidated Leverage Ratio” means, as of any date of determination, the ratio of (a)
Consolidated Funded Indebtedness as of such date to (b) Consolidated Total Capitalization as of
such date.

     “Consolidated Shareholders’ Equity” means, as of any date of determination,
consolidated shareholders’ equity of the Borrower and its Subsidiaries as of such date.

     “Consolidated Total Capitalization” means, as of any date of determination, the sum of
(a) Consolidated Funded Indebtedness as of such date plus (b) Consolidated Shareholders’
Equity as of such date.

     “Contractual Obligation” means, as to any Person, any provision of any security issued
by such Person or of any agreement, instrument or other undertaking to which such Person is a party
or by which it or any of its property is bound.

 	 	 	 
	 	4	Credit Agreement

 

     “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.

     “Debtor Relief Laws” means the Bankruptcy Code of the United States, and all other
liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium,
rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the
United States or other applicable jurisdictions from time to time in effect and affecting the
rights of creditors generally.

     “Default” means any event or condition that constitutes an Event of Default or that,
with the giving of any notice, the passage of time, or both, would be an Event of Default.

     “Default Rate” means an interest rate equal to (a) the Base Rate plus (b) 2%
per annum; provided, however, that with respect to a Eurodollar Rate Loan, the
Default Rate shall be an interest rate equal to the interest rate otherwise applicable to such Loan
plus 2% per annum.

     “Defaulting Lender” means any Lender that (a) has failed to fund any portion of the
Loans required to be funded by it hereunder within one Business Day of the date required to be
funded by it hereunder, (b) has otherwise failed to pay over to the Administrative Agent or any
other Lender any other amount required to be paid by it hereunder within one Business Day of the
date when due, unless the subject of a good faith dispute or (c) has been deemed insolvent or
become the subject of a bankruptcy or insolvency proceeding.

     “Department” means, as to any Insurance Subsidiary, the state department of insurance
of the state of domicile of such Insurance Subsidiary.

     “Disposition” or “Dispose” means the sale, transfer, license, lease or other
disposition (including any sale and leaseback transaction) of any property by any Person, including
any sale, assignment, transfer or other disposal, with or without recourse, of any notes or
accounts receivable or any rights and claims associated therewith.

     “Dollar” and “$” mean lawful money of the United States.

     “Eligible Assignee” means (a) a Lender, (b) an Affiliate of a Lender, (c) an Approved
Fund and (d) any other Person (other than a natural person) approved by (i) the Administrative
Agent and (ii) unless an Event of Default has occurred and is continuing, the Borrower (each such
approval not to be unreasonably withheld or delayed); provided that notwithstanding the
foregoing, “Eligible Assignee” shall not include the Borrower or any of the Borrower’s Affiliates
or Subsidiaries.

     “Environmental Laws” means any and all Laws relating to pollution and the protection
of the environment or the release of any materials into the environment, including those related to
hazardous substances or wastes, air emissions and discharges to waste or public systems.

     “Environmental Liability” means any liability, contingent or otherwise (including any
liability for damages, costs of environmental remediation, fines, penalties or indemnities), of the

 	 	 	 
	 	5	Credit Agreement

 

Borrower or any of its Subsidiaries directly or indirectly 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,
agreement or other consensual arrangement pursuant to which liability is assumed or imposed with
respect to any of the foregoing.

     “ERISA” means the Employee Retirement Income Security Act of 1974.

     “ERISA Affiliate” means any trade or business (whether or not incorporated) under
common control with the Borrower within the meaning of Section 414(b) or (c) of the Code (and
Sections 414(m) and (o) of the Code for purposes of provisions relating to Section 412 of the
Code).

     “ERISA Event” means (a) a Reportable Event with respect to a Pension Plan, (b) a
withdrawal by the Borrower or any ERISA Affiliate from a Pension Plan subject to Section 4063 of
ERISA during a plan year in which it was a substantial employer (as defined in Section 4001(a)(2)
of ERISA) or a cessation of operations that is treated as such a withdrawal under Section 4062(e)
of ERISA, (c) a complete or partial withdrawal by the Borrower or any ERISA Affiliate from a
Multiemployer Plan or notification that a Multiemployer Plan is in reorganization, (d) the filing
of a notice of intent to terminate, the treatment of a Plan amendment as a termination under
Sections 4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a
Pension Plan or Multiemployer Plan, (e) an event or condition which constitutes grounds under
Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any
Pension Plan or Multiemployer Plan or (f) the imposition of any liability under Title IV of ERISA,
other than for PBGC premiums due but not delinquent under Section 4007 of ERISA, upon the Borrower
or any ERISA Affiliate, which, in the case of each matter referred to in clauses (a) through (f),
could reasonably be expected to have a Material Adverse Effect.

     “Eurodollar Rate” means for any Interest Period with respect to a Eurodollar Rate
Loan, the rate per annum equal to the British Bankers Association LIBOR Rate (“BBA LIBOR”),
as published by Reuters (or other commercially available source providing quotations of BBA LIBOR
as designated by the Administrative Agent from time to time) at approximately 11:00 a.m., London
time, two Business Days prior to the commencement of such Interest Period, for Dollar deposits (for
delivery on the first day of such Interest Period) with a term equivalent to such Interest Period.
If such rate is not available at such time for any reason, then the “Eurodollar Rate” for such
Interest Period shall be the rate per annum determined by the Administrative Agent to be the rate
at which deposits in Dollars for delivery on the first day of such Interest Period in same day
funds in the approximate amount of the Eurodollar Rate Loan being made, continued or converted by
Bank of America and with a term equivalent to such Interest Period would be offered by Bank of
America’s London Branch to major banks in the London interbank eurodollar market at their request
at approximately 11:00 a.m. (London time) two Business Days prior to the commencement of such
Interest Period.

     “Eurodollar Rate Loan” means a Loan that bears interest at a rate based on the
Eurodollar Rate.

 	 	 	 
	 	6	Credit Agreement

 

     “Event of Default” has the meaning specified in Section 8.01.

     “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 the Borrower
hereunder, (a) taxes imposed on or measured by its overall net income or gross receipts (however
denominated), and franchise taxes imposed on it (in lieu of net income taxes), (b) any branch
profits taxes imposed by the United States or any similar tax imposed by any other jurisdiction,
and (c) in the case of a Foreign Lender (other than an assignee pursuant to a request by the
Borrower under Section 10.13), any withholding tax that is imposed on amounts payable to
such Foreign Lender at the time such Foreign Lender becomes a party hereto (or designates a new
Lending Office) or is attributable to such Foreign Lender’s failure or inability (other than as a
result of a Change in Law) to comply with Section 3.01(e), except to the extent that such
Foreign Lender (or its assignor, if any) was entitled, at the time of designation of a new Lending
Office (or assignment), to receive additional amounts from the Borrower with respect to such
withholding tax pursuant to Section 3.01(a).

     “Federal Funds Rate" means, for any day, the rate per annum equal to the
weighted average of the rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve
Bank of New York on the Business Day next succeeding such day; provided that (a) if such
day is not a Business Day, the Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding Business Day as so published on the next succeeding Business Day
and (b) if no such rate is so published on such next succeeding Business Day, the Federal Funds
Rate for such day shall be the average rate (rounded upward, if necessary, to a whole multiple of
1/100 of 1%) charged to Bank of America on such day on such transactions as determined by the
Administrative Agent.

     “Fee Letter” means the letter agreement, dated June 7, 2006, among the Borrower, the
Administrative Agent and the Arranger.

     “Foreign Lender” means any Lender that is organized under the laws of a jurisdiction
other than that in which the Borrower is resident for tax purposes. For purposes of this
definition, the United States, each State thereof and the District of Columbia shall be deemed to
constitute a single jurisdiction.

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

     “Fund” means any Person (other than a natural person) that is (or will be) engaged in
making, purchasing, holding or otherwise investing in commercial loans and similar extensions of
credit in the ordinary course of its business.

     “GAAP” means generally accepted accounting principles in the United States set forth
in the opinions and pronouncements of the Accounting Principles Board and the American Institute of
Certified Public Accountants and statements and pronouncements of the Financial Accounting
Standards Board or such other principles as may be approved by a significant segment of the

 	 	 	 
	 	7	Credit Agreement

 

accounting profession in the United States, that are applicable to the circumstances as of the
date of determination, consistently applied.

     “Governmental Authority” means the government of the United States or any other
nation, or of 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.

     “Guarantee” means, as to any Person, any (a) any obligation, contingent or otherwise,
of such Person guaranteeing or having the economic effect of guaranteeing any indebtedness or other
obligation payable or performable by another Person (the “primary obligor”) in any manner, whether
directly or indirectly, and including any obligation of such Person, direct or indirect, (i) to
purchase or pay (or advance or supply funds for the purchase or payment of) such indebtedness or
other obligation, (ii) to purchase or lease property, securities or services for the purpose of
assuring the obligee in respect of such indebtedness or other obligation of the payment or
performance of such indebtedness or other obligation, (iii) to maintain working capital, equity
capital or any other financial statement condition or liquidity or level of income or cash flow of
the primary obligor so as to enable the primary obligor to pay such indebtedness or other
obligation, or (iv) entered into for the purpose of assuring in any other manner the obligee in
respect of such indebtedness or other obligation of the payment or performance thereof or to
protect such obligee against loss in respect thereof (in whole or in part) or (b) any Lien on any
assets of such Person securing any indebtedness or other obligation of any other Person, whether or
not such indebtedness or other obligation is assumed by such Person (or any right, contingent or
otherwise, of any holder of such indebtedness to obtain any such Lien). The amount of any
Guarantee shall be deemed to be an amount equal to the stated or determinable amount of the related
primary obligation, or portion thereof, in respect of which such Guarantee is made or, if not
stated or determinable, the maximum reasonably anticipated liability in respect thereof as
determined by the guaranteeing Person in good faith. The term “Guarantee” as a verb has a
corresponding meaning.

     “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.

     “Indemnified Taxes” means Taxes other than Excluded Taxes.

     “Indemnitee” has the meaning specified in Section 10.04(b).

     “Information” has the meaning specified in Section 10.07.

     “Insurance Subsidiary” means any Subsidiary of the Borrower that is authorized or
admitted to carry on or transact one or more aspects of the business of selling, issuing or
underwriting insurance or reinsurance.

 	 	 	 
	 	8	Credit Agreement

 

 

     “Interest Payment Date” means, (a) as to any Loan other than a Base Rate Loan, the
last day of each Interest Period applicable to such Loan and the Maturity Date; provided,
however, that if any Interest Period for a Eurodollar Rate Loan exceeds three months, the
respective dates that fall every three months after the beginning of such Interest Period shall
also be Interest Payment Dates; and (b) as to any Base Rate Loan, the last Business Day of each
March, June, September and December and the Maturity Date.

     “Interest Period” means, as to each Eurodollar Rate Loan, the period commencing on the
date such Eurodollar Rate Loan is disbursed or converted to or continued as a Eurodollar Rate Loan
and ending on the date one, two, three or six months thereafter, as selected by the Borrower in its
Loan Notice; provided that:

     (a) any Interest Period that would otherwise end on a day that is not a Business Day
shall be extended to the next succeeding Business Day unless such Business Day falls in
another calendar month, in which case such Interest Period shall end on the next preceding
Business Day;

     (b) any Interest Period that begins on the last Business Day of a calendar month (or on
a day for which there is no numerically corresponding day in the calendar month at the end
of such Interest Period) shall end on the last Business Day of the calendar month at the end
of such Interest Period; and

     (c) no Interest Period shall extend beyond the Maturity Date.

     “IRS” means the United States Internal Revenue Service.

     “Laws” means, collectively, all international, foreign, Federal, state and local
statutes, treaties, rules, guidelines, regulations, ordinances, codes and administrative or
judicial precedents or authorities, including the interpretation or administration thereof by any
Governmental Authority charged with the enforcement, interpretation or administration thereof, and
all applicable administrative orders, directed duties, requests, licenses, authorizations and
permits of, and agreements with, any Governmental Authority, in each case whether or not having the
force of law.

     “Lender” and “Lenders” have the meanings specified in the introductory
paragraph hereto.

     “Lending Office” means, as to any Lender, the office or offices of such Lender
described as such in such Lender’s Administrative Questionnaire, or such other office or offices as
a Lender may from time to time notify the Borrower and the Administrative Agent.

     “Lien” means any mortgage, pledge, hypothecation, assignment, deposit arrangement,
encumbrance, lien (statutory or other), charge, or preference, priority or other security interest
or preferential arrangement in the nature of a security interest of any kind or nature whatsoever
(including any conditional sale or other title retention agreement, any easement, right of way or
other encumbrance on title to real property, and any financing lease having substantially the same
economic effect as any of the foregoing).

 	 	 	 
	 	9	Credit Agreement

 

     “Loan” has the meaning specified in Section 2.01.

     “Loan Documents” means this Agreement and each Note.

     “Loan Notice” means a notice of (a) a Borrowing, (b) a conversion of Loans from one
Type to the other or (c) a continuation of Eurodollar Rate Loans, in each case pursuant to
Section 2.02(a), which, if in writing, shall be substantially in the form of Exhibit
A.

     “Material Adverse Effect” means (a) a material adverse change in, or a material
adverse effect upon, the operations, business, properties, liabilities (actual or contingent),
condition (financial or otherwise) or prospects of the Borrower and its Subsidiaries taken as a
whole, (b) a material impairment of the ability of the Borrower to perform its obligations under
any Loan Document to which it is a party or (c) a material adverse effect upon the legality,
validity, binding effect or enforceability against the Borrower of any Loan Document to which it is
a party.

     “Maturity Date” means June 29, 2007.

     “Maximum Rate” has the meaning specified in Section 10.09.

     “Model Act” means the Risk-Based Capital for Insurers Model Act as promulgated by the
NAIC.

     “Multiemployer Plan” means any employee benefit plan of the type described in Section
4001(a)(3) of ERISA, to which the Borrower or any ERISA Affiliate makes or is obligated to make
contributions, or during the preceding five plan years, has made or been obligated to make
contributions.

     “NAIC” means the National Association of Insurance Commissioners, or any successor
organization.

     “Note” means a promissory note made by the Borrower in favor of a Lender evidencing
Loans made by such Lender, substantially in the form of Exhibit B.

     “Obligations” means all advances to, and debts, liabilities, obligations, covenants
and duties of, the Borrower arising under any Loan Document or otherwise with respect to any Loan,
whether direct or indirect (including those acquired by assumption), absolute or contingent, due or
to become due, now existing or hereafter arising and including interest and fees that accrue after
the commencement by or against the Borrower of any proceeding under any Debtor Relief Laws naming
the Borrower as the debtor in such proceeding, regardless of whether such interest and fees are
allowed claims in such proceeding.

     “Organization Documents” means, (a) with respect to any corporation, the certificate
or articles of incorporation and the bylaws (or equivalent or comparable constitutive documents
with respect to any non-U.S. jurisdiction), (b) with respect to any limited liability company, the
certificate or articles of formation or organization and operating agreement and (c) with respect
to any partnership, joint venture, trust or other form of business entity, the partnership, joint
venture or other applicable agreement of formation or organization and any agreement,

 	 	 	 
	 	10	Credit Agreement

 

instrument, filing or notice with respect thereto filed in connection with its formation or
organization with the applicable Governmental Authority in the jurisdiction of its formation or
organization and, if applicable, any certificate or articles of formation or organization of such
entity.

     “Other Taxes” means all present or future stamp or documentary taxes or any other
excise or property taxes, charges or similar levies arising from any payment made hereunder or
under any other Loan Document or from the execution, delivery or enforcement of, or otherwise with
respect to, this Agreement or any other Loan Document.

     “Participant” has the meaning specified in Section 10.06(d).

     “PBGC” means the Pension Benefit Guaranty Corporation.

     “Pension Plan” means any “employee pension benefit plan” (as such term is defined in
Section 3(2) of ERISA), other than a Multiemployer Plan, that is subject to Title IV of ERISA and
is sponsored or maintained by the Borrower or any ERISA Affiliate or to which the Borrower or any
ERISA Affiliate contributes or has an obligation to contribute, or in the case of a multiple
employer or other plan described in Section 4064(a) of ERISA, has made contributions at any time
during the immediately preceding five plan years.

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

     “PIC” means Philadelphia Insurance Company, a Pennsylvania corporation.

     “PIIC” means Philadelphia Indemnity Insurance Company, a Pennsylvania corporation.

     “Plan” means any “employee benefit plan” (as such term is defined in Section 3(3) of
ERISA) established by the Borrower or, with respect to any such plan that is subject to Section 412
of the Code or Title IV of ERISA, any ERISA Affiliate.

     “Register” has the meaning specified in Section 10.06(c).

     “Registered Public Accounting Firm” has the meaning specified in the Securities Laws
and shall be independent of the Borrower as prescribed by the Securities Laws.

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

     “Reportable Event” means any of the events set forth in Section 4043(c) of ERISA,
other than events for which the 30 day notice period has been waived.

     “Required Lenders” means, as of any date of determination, at least two Lenders
holding at least 66-2/3% of the Aggregate Commitments or, if the commitment of each Lender to make
Loans has been terminated pursuant to Section 8.02, at least two Lenders holding in the
aggregate at least 66-2/3% of the principal balance of the Loans; provided that the
Commitment

 	 	 	 
	 	11	Credit Agreement

 

of, and the portion of the principal balance of the Loans held by, any Defaulting Lender shall
be excluded for purposes of making a determination of Required Lenders.

     “Responsible Officer” means the chief executive officer, president, chief financial
officer, treasurer, assistant treasurer or controller of the Borrower. Any document delivered
hereunder that is signed by a Responsible Officer of the Borrower shall be conclusively presumed to
have been authorized by all necessary corporate or other action on the part of the Borrower and
such Responsible Officer shall be conclusively presumed to have acted on behalf of the Borrower.

     “Restricted Payment” means any dividend or other distribution (whether in cash,
securities or other property) with respect to any capital stock or other equity interest of the
Borrower or any Subsidiary, or any payment (whether in cash, securities or other property),
including any sinking fund or similar deposit, on account of the purchase, redemption, retirement,
acquisition, cancellation or termination of any such capital stock or other equity interest, or on
account of any return of capital to the Borrower’s or any Subsidiary’s stockholders, partners or
members (or the equivalent Person thereof).

     “SAP” means, as to any Insurance Subsidiary, the statutory accounting practices
prescribed or permitted by its Department.

     “Sarbanes-Oxley” means the Sarbanes-Oxley Act of 2002.

     “SEC” means the Securities and Exchange Commission, or any Governmental Authority
succeeding to any of its principal functions.

     “Securities Laws” means the Securities Act of 1933, the Securities Exchange Act of
1934, Sarbanes-Oxley and the applicable accounting and auditing principles, rules, standards and
practices promulgated, approved or incorporated by the SEC or the Public Company Accounting
Oversight Board, as each of the foregoing may be amended and in effect on any applicable date
hereunder.

     “Significant Subsidiary” means, as of any date of determination, (a) each Subsidiary
listed on Schedule 5.13, (b) each other Subsidiary that is an Insurance Subsidiary and (c)
each other Subsidiary whose consolidated assets or revenues (as determined in accordance with GAAP)
exceed 10% of the consolidated assets or revenues of the Borrower and its Subsidiaries as of the
end of or for the most recent fiscal quarter for which financial statements have been delivered
pursuant to Section 6.01(a) or (b).

     “Subsidiary” of a Person means a corporation, partnership, joint venture, limited
liability company or other business entity of which a majority of the shares of securities or other
interests having ordinary voting power for the election of directors or other governing body (other
than securities or interests having such power only by reason of the happening of a contingency)
are at the time beneficially owned, or the management of which is otherwise controlled, directly,
or indirectly through one or more intermediaries, or both, by such Person. Unless otherwise
specified, all references herein to a “Subsidiary” or to “Subsidiaries” shall refer to a Subsidiary
or Subsidiaries of the Borrower.

	 	 	 
	 	12	Credit Agreement

 

     “Swap Contract” means (a) any and all rate swap transactions, basis swaps, credit
derivative transactions, forward rate transactions, commodity swaps, commodity options, forward
commodity contracts, equity or equity index swaps or options, bond or bond price or bond index
swaps or options or forward bond or forward bond price or forward bond index transactions, interest
rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar
transactions, currency swap transactions, cross-currency rate swap transactions, currency options,
spot contracts, or any other similar transactions or any combination of any of the foregoing
(including any options to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement and (b) any and all transactions of any kind, and
the related confirmations, which are subject to the terms and conditions of, or governed by, any
form of master agreement published by the International Swaps and Derivatives Association, Inc.,
any International Foreign Exchange Master Agreement, or any other master agreement (any such master
agreement, together with any related schedules, a “Master Agreement”), including any such
obligations or liabilities under any Master Agreement.

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

     “Synthetic Lease Obligation” means the monetary obligation of a Person under (a) a
so-called synthetic, off-balance sheet or tax retention lease or (b) an agreement for the use or
possession of property creating obligations that do not appear on the balance sheet of such Person
but which, upon the insolvency or bankruptcy of such Person, would be characterized as the
indebtedness of such Person (without regard to accounting treatment).

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

     “Threshold Amount” means $25,000,000.

     “Type” means, with respect to a Loan, its character as a Base Rate Loan or a
Eurodollar Rate Loan.

     “Unfunded Pension Liability” means the excess of a Pension Plan’s benefit liabilities
under Section 4001(a)(16) of ERISA, over the current value of that Pension Plan’s assets,
determined in accordance with the assumptions used for funding the Pension Plan pursuant to Section
412 of the Code for the applicable plan year.

     “United States” and “U.S.” mean the United States of America.

 	 	 	 
	 	13	Credit Agreement

 

     1.02 Other Interpretive Provisions. With reference to this Agreement and each other Loan Document, unless otherwise specified
herein or in such other Loan Document:

     (a) 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 “shall.” Unless the context requires otherwise, (i) any
definition of or reference to any agreement, instrument or other document (including any
Organization Document) shall be construed as referring to such agreement, instrument 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 or in any
other Loan Document), (ii) any reference herein to any Person shall be construed to include
such Person’s successors and assigns, (iii) the words “herein,” “hereof” and
“hereunder,” and words of similar import when used in any Loan Document, shall be
construed to refer to such Loan Document in its entirety and not to any particular provision
thereof, (iv) all references in a Loan Document to Articles, Sections, Exhibits and
Schedules shall be construed to refer to Articles and Sections of, and Exhibits and
Schedules to, the Loan Document in which such references appear, (v) any reference to any
Law shall include all statutory and regulatory provisions consolidating, amending, replacing
or interpreting such Law and any reference to any Law shall, unless otherwise specified,
refer to such Law as amended, modified or supplemented from time to time, and (vi) 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.

     (b) In the computation of periods of time from a specified date to a later specified
date, the word “from” means “from and including;” the words “to” and
“until” each mean “to but excluding;” and the word “through” means
“to and including.”

     (c) Section headings herein and in the other Loan Documents are included for
convenience of reference only and shall not affect the interpretation of this Agreement or
any other Loan Document.

1.03 Accounting Terms. (a) Generally. All accounting terms not specifically
or completely defined herein shall be construed in conformity with, and all financial data
(including financial ratios and other financial calculations) required to be submitted
pursuant to this Agreement shall be prepared in conformity with, GAAP or SAP, as may be
applicable, applied on a consistent basis, as in effect from time to time, applied in a
manner consistent with that used in preparing the Audited Financial Statements or the Annual
Financial Statements described in Section 5.05(d), as may be applicable,
except as otherwise specifically prescribed herein.

     (b) Changes in GAAP or SAP. If at any time any change in GAAP or SAP, as may
be applicable, would affect the computation of any financial ratio or requirement set forth
in any Loan Document, and either the Borrower or the Required Lenders shall so

	 	 	 
	 	14	Credit Agreement

 

request, the
Administrative Agent, the Lenders and the Borrower shall negotiate in good faith to amend
such ratio or requirement to preserve the original intent thereof in light of such change in
GAAP or SAP, as may be applicable (subject to the approval of the Required Lenders);
provided that, until so amended, (i) such ratio or requirement shall
continue to be computed in accordance with GAAP or SAP, as may be applicable, prior to such
change therein and (ii) the Borrower shall provide to the Administrative Agent and the
Lenders financial statements and other documents required under this Agreement or as
reasonably requested hereunder setting forth a reconciliation between calculations of such
ratio or requirement made before and after giving effect to such change in GAAP or SAP, as
may be applicable.

     1.04 Rounding. Any financial ratios required to be maintained by the Borrower pursuant to
this Agreement shall be calculated by dividing the appropriate component by the other component,
carrying the result to one place more than the number of places by which such ratio is expressed
herein and rounding the result up or down to the nearest number (with a rounding-up if there is no
nearest number).

     1.05 Times of Day. Unless otherwise specified, all references herein to times of day shall be
references to Eastern time (daylight or standard, as applicable).

ARTICLE II.

THE COMMITMENTS

     2.01 Loans. Subject to the terms and conditions set forth herein, each Lender severally
agrees to make loans (each such loan, a “Loan”) to the Borrower from time to time, on any
Business Day during the Availability Period, in an aggregate amount not to exceed at any time
outstanding the amount of such Lender’s Commitment; provided, however, that after
giving effect to any Borrowing, the principal balance of the Loans shall not exceed the Aggregate
Commitments. Within the limits of each Lender’s Commitment, and subject to the other terms and
conditions hereof, the Borrower may borrow under this Section 2.01, prepay under
Section 2.03, and reborrow under this Section 2.01. Loans may be Base Rate Loans
or Eurodollar Rate Loans, as further provided herein.

     2.02 Borrowings, Conversions and Continuations of Loans.

     (a) Each Borrowing, each conversion of Loans from one Type to the other, and each continuation
of Eurodollar Rate Loans shall be made upon the Borrower’s irrevocable notice to the Administrative
Agent, which may be given by telephone. Each such notice must be received by the Administrative
Agent not later than 11:00 a.m. (i) three Business Days prior to the
requested date of any Borrowing of, conversion to or continuation of Eurodollar Rate Loans or
of any conversion of Eurodollar Rate Loans to Base Rate Loans and (ii) on the requested date of any
Borrowing of Base Rate Loans. Each telephonic notice by the Borrower pursuant to this Section
2.02(a) must be confirmed promptly by delivery to the Administrative Agent of a written Loan
Notice, appropriately completed and signed by a Responsible Officer of the Borrower. Each
Borrowing of, conversion to or continuation of Eurodollar Rate Loans shall be in a principal amount
of $1,000,000 or a whole multiple of $1,000,000 in excess thereof. Each Borrowing of or conversion
to Base Rate Loans shall be in a principal amount of $500,000 or a

 	 	 	 
	 	15	Credit Agreement

 

whole multiple of $100,000 in
excess thereof. Each Loan Notice (whether telephonic or written) shall specify (i) whether the
Borrower is requesting a Borrowing, a conversion of Loans from one Type to the other, or a
continuation of Eurodollar Rate Loans, (ii) the requested date of the Borrowing, conversion or
continuation, as the case may be (which shall be a Business Day), (iii) the principal amount of
Loans to be borrowed, converted or continued, (iv) the Type of Loans to be borrowed or to which
existing Loans are to be converted and (v) if applicable, the duration of the Interest Period with
respect thereto. If the Borrower fails to specify a Type of Loan in a Loan Notice or if the
Borrower fails to give a timely notice requesting a conversion or continuation, then the applicable
Loans shall be made as, or converted to, Base Rate Loans. Any such automatic conversion to Base
Rate Loans shall be effective as of the last day of the Interest Period then in effect with respect
to the applicable Eurodollar Rate Loans. If the Borrower requests a Borrowing of, conversion to,
or continuation of Eurodollar Rate Loans in any such Loan Notice, but fails to specify an Interest
Period, it will be deemed to have specified an Interest Period of one month.

     (b) Following receipt of a Loan Notice, the Administrative Agent shall promptly notify each
Lender of the amount of its Applicable Percentage of the applicable Loans, and if no timely notice
of a conversion or continuation is provided by the Borrower, the Administrative Agent shall notify
each Lender of the details of any automatic conversion to Base Rate Loans described in the
preceding subsection. In the case of a Borrowing, each Lender shall make the amount of its Loan
available to the Administrative Agent in immediately available funds at the Administrative Agent’s
Office not later than 1:00 p.m. on the Business Day specified in the applicable Loan Notice. Upon
satisfaction of the applicable conditions set forth in Section 4.02 (and, if such Borrowing
is the initial Borrowing, Section 4.01), the Administrative Agent shall make all funds so
received available to the Borrower in like funds as received by the Administrative Agent either by
(i) crediting the account of the Borrower on the books of Bank of America with the amount of such
funds or (ii) wire transfer of such funds, in each case in accordance with instructions provided to
(and reasonably acceptable to) the Administrative Agent by the Borrower.

     (c) Except as otherwise provided herein, a Eurodollar Rate Loan may be continued or converted
only on the last day of an Interest Period for such Eurodollar Rate Loan. During the existence of
a Default, no Loans may be requested as, converted to or continued as Eurodollar Rate Loans without
the consent of the Required Lenders.

     (d) The Administrative Agent shall promptly notify the Borrower and the Lenders of the
interest rate applicable to any Interest Period for Eurodollar Rate Loans upon determination of
such interest rate. At any time that Base Rate Loans are outstanding, the Administrative
Agent shall notify the Borrower and the Lenders of any change in Bank of America’s prime rate
used in determining the Base Rate promptly following the public announcement of such change.

     (e) After giving effect to all Borrowings, all conversions of Loans from one Type to the
other, and all continuations of Loans as the same Type, there shall not be more than five Interest
Periods in effect with respect to Loans.

 	 	 	 
	 	16	Credit Agreement

 

     2.03 Prepayments.

     (a) The Borrower may, upon notice to the Administrative Agent, at any time or from time to
time voluntarily prepay Loans in whole or in part without premium or penalty; provided that
(i) such notice must be received by the Administrative Agent not later than 11:00 a.m. (A) three
Business Days prior to any date of prepayment of Eurodollar Rate Loans and (B) on the date of
prepayment of Base Rate Loans; (ii) any prepayment of Eurodollar Rate Loans shall be in a principal
amount of $1,000,000 or a whole multiple of $1,000,000 in excess thereof; and (iii) any prepayment
of Base Rate Loans shall be in a principal amount of $500,000 or a whole multiple of $100,000 in
excess thereof or, in each case, if less, the entire principal amount thereof then outstanding.
Each such notice shall specify the date and amount of such prepayment and the Type(s) of Loans to
be prepaid. The Administrative Agent will promptly notify each Lender of its receipt of each such
notice, and of the amount of such Lender’s Applicable Percentage of such prepayment. If such
notice is given by the Borrower, the Borrower shall make such prepayment and the payment amount
specified in such notice shall be due and payable on the date specified therein. Any prepayment of
a Eurodollar Rate Loan shall be accompanied by all accrued interest on the amount prepaid, together
with any additional amounts required pursuant to Section 3.05. Each such prepayment shall
be applied to the Loans of the Lenders in accordance with their respective Applicable Percentages.

     (b) If for any reason the principal balance of the Loans at any time exceed the Aggregate
Commitments then in effect, the Borrower shall immediately prepay Loans in an aggregate amount
equal to such excess.

     2.04 Termination or Reduction of Commitments. The Borrower may, upon notice to the
Administrative Agent, terminate the Aggregate Commitments, or from time to time permanently reduce
the Aggregate Commitments; provided that (a) any such notice shall be received by the
Administrative Agent not later than 11:00 a.m. five Business Days prior to the date of termination
or reduction, (b) any such partial reduction shall be in an aggregate amount of $5,000,000 or any
whole multiple of $1,000,000 in excess thereof and (c) the Borrower shall not terminate or reduce
the Aggregate Commitments if, after giving effect thereto and to any concurrent prepayments
hereunder, the principal balance of the Loans would exceed the Aggregate Commitments. The
Administrative Agent will promptly notify the Lenders of any such notice of termination or
reduction of the Aggregate Commitments. Any reduction of the Aggregate Commitments shall be
applied to the Commitment of each Lender according to its Applicable Percentage. All fees accrued
until the effective date of any termination of the Aggregate Commitments shall be paid on the
effective date of such termination.

     2.05 Repayment of Loans. The Borrower shall repay to the Lenders on the Maturity Date the
aggregate principal amount of Loans outstanding on such date.

     2.06 Interest.

     (a) Subject to the provisions of subsection (b) below, (i) each Eurodollar Rate Loan shall
bear interest on the outstanding principal amount thereof for each Interest Period at a rate per
annum equal to the Eurodollar Rate for such Interest Period plus 0.40% and (ii) each Base

 	 	 	 
	 	17	Credit Agreement

 

Rate Loan shall bear interest on the outstanding principal amount thereof at a rate per annum equal
to the Base Rate.

     (b) (i) If any amount of principal of any Loan is not paid when due (without regard to any
applicable grace periods), whether at stated maturity, by acceleration or otherwise, such amount
shall thereafter bear interest at a fluctuating interest rate per annum at all times equal to the
Default Rate to the fullest extent permitted by applicable Laws.

     (ii) If any amount (other than principal of any Loan) payable by the Borrower under any
Loan Document is not paid when due (without regard to any applicable grace periods), whether
at stated maturity, by acceleration or otherwise, then upon the request of the Required
Lenders, such amount shall thereafter bear interest at a fluctuating interest rate per annum
at all times equal to the Default Rate to the fullest extent permitted by applicable Laws.

     (iii) Upon the request of the Required Lenders, while any Event of Default exists, the
Borrower shall pay interest on the principal amount of all outstanding Obligations hereunder
at a fluctuating interest rate per annum at all times equal to the Default Rate to the
fullest extent permitted by applicable Laws.

     (iv) Accrued and unpaid interest on past due amounts (including interest on past due
interest) shall be due and payable upon demand.

     (c) Interest on each Loan shall be due and payable in arrears on each Interest Payment Date
applicable thereto and at such other times as may be specified herein. Interest hereunder shall be
due and payable in accordance with the terms hereof before and after judgment, and before and after
the commencement of any proceeding under any Debtor Relief Law.

     2.07 Commitment Fee. The Borrower shall pay to the Administrative Agent for the account of
each Lender in accordance with its Applicable Percentage, a commitment fee equal to .08% per annum
times the actual daily amount by which the Aggregate Commitments exceed the principal
balance of the Loans. The commitment fee shall accrue at all times during the Availability Period,
including at any time during which one or more of the conditions in Article IV is not met,
and shall be due and payable quarterly in arrears on the last Business Day of each March, June,
September and
December, commencing with the first such date to occur after the Closing Date, and on the
Maturity Date.

     2.08 Computation of Interest and Fees. All computations of interest for Base Rate Loans when
the Base Rate is determined by Bank of America’s “prime rate” shall be made on the basis of a year
of 365 or 366 days, as the case may be, and actual days elapsed. All other computations of fees
and interest shall be made on the basis of a 360-day year and actual days elapsed (which results in
more fees or interest, as applicable, being paid than if computed on the basis of a 365-day year).
Interest shall accrue on each Loan for the day on which the Loan is made, and shall not accrue on a
Loan, or any portion thereof, for the day on which the Loan or such portion is paid;
provided that any Loan that is repaid on the same day on which it is made shall, subject to
Section 2.10(a), bear interest for one day. Each determination by the

	 	 	 
	 	18	Credit Agreement

 

Administrative Agent
of an interest rate or fee hereunder shall be conclusive and binding for all purposes, absent
demonstrable error.

     2.09 Evidence of Debt. The Loans made by each Lender shall be evidenced by one or more
accounts or records maintained by such Lender and by the Administrative Agent in the ordinary
course of business. The accounts or records maintained by the Administrative Agent and each Lender
shall be conclusive absent demonstrable error of the amount of the Loans made by the Lenders to the
Borrower and the interest and payments thereon. Any failure to so record or any error in doing so
shall not, however, limit or otherwise affect the obligation of the Borrower hereunder to pay any
amount owing with respect to the Obligations. In the event of any conflict between the accounts
and records maintained by any Lender and the accounts and records of the Administrative Agent in
respect of such matters, the accounts and records of the Administrative Agent shall control in the
absence of demonstrable error. Upon the request of any Lender made through the Administrative
Agent, the Borrower shall execute and deliver to such Lender (through the Administrative Agent) a
Note, which shall evidence such Lender’s Loans in addition to such accounts or records. Each
Lender may attach schedules to its Note and endorse thereon the date, Type (if applicable), amount
and maturity of its Loans and payments with respect thereto.

     2.10 Payments Generally; Administrative Agent’s Clawback.

     (a) General. All payments to be made by the Borrower shall be made without condition
or deduction for any counterclaim, defense, recoupment or setoff. Except as otherwise expressly
provided herein, all payments by the Borrower hereunder shall be made to the Administrative Agent,
for the account of the respective Lenders to which such payment is owed, at the Administrative
Agent’s Office in Dollars and in immediately available funds not later than 2:00 p.m. on the date
specified herein. The Administrative Agent will promptly distribute to each Lender its Applicable
Percentage (or other applicable share as provided herein) of such payment in like funds as received
by wire transfer to such Lender’s Lending Office. All payments received by the Administrative
Agent after 2:00 p.m. shall be deemed received on the next succeeding Business Day and any
applicable interest or fee shall continue to accrue. If any payment to be made by the Borrower
shall come due on a day other than a Business Day,
payment shall be made on the next following Business Day, and such extension of time shall be
reflected in computing interest or fees, as the case may be.

     (b) (i) Funding by Lenders; Presumption by Administrative Agent. Unless the
Administrative Agent shall have received notice from a Lender prior to the proposed date of any
Borrowing of Eurocurrency Rate Loans (or, in the case of any Borrowing of Base Rate Loans, prior to
12:00 noon on the 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 Section 2.02
(or, in the case of a Borrowing of Base Rate Loans, that such Lender has made such share available
in accordance with and at the time required by Section 2.02) and may, in reliance upon such
assumption, make available to the Borrower 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 Borrower severally agree to pay to the Administrative Agent forthwith
on demand such corresponding amount in immediately available

 	 	 	 
	 	19	Credit Agreement

 

funds with interest thereon, for each
day from and including the date such amount is made available to the Borrower to but excluding the
date of payment to the Administrative Agent, at (A) in the case of a payment to be made by such
Lender, the greater of the Federal Funds Rate and a rate determined by the Administrative Agent in
accordance with banking industry rules on interbank compensation and (B) in the case of a payment
to be made by the Borrower, the interest rate applicable to Base Rate Loans. If the Borrower and
such Lender shall pay such interest to the Administrative Agent for the same or an overlapping
period, the Administrative Agent shall promptly remit to the Borrower the amount of such interest
paid by the Borrower for such period. If such Lender pays its share of the applicable Borrowing to
the Administrative Agent, then the amount so paid shall constitute such Lender’s Loan included in
such Borrowing. Any payment by the Borrower shall be without prejudice to any claim the Borrower
may have against a Lender that shall have failed to make such payment to the Administrative Agent.

     (ii) Payments by Borrower; Presumptions by Administrative Agent. Unless the
Administrative Agent shall have received notice from the Borrower prior to the date on which any
payment is due to the Administrative Agent for the account of the Lenders hereunder that the
Borrower will not make such payment, the Administrative Agent may assume that the Borrower has made
such payment on such date in accordance herewith and may, in reliance upon such assumption,
distribute to the Lenders the amount due. In such event, if the Borrower 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, in immediately available funds 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 greater of the Federal Funds Rate and a
rate determined by the Administrative Agent in accordance with banking industry rules on interbank
compensation.

     A notice of the Administrative Agent to any Lender or the Borrower with respect to any amount
owing under this subsection (b) shall be conclusive, absent demonstrable error.

     (c) Failure to Satisfy Conditions Precedent. If any Lender makes available to the
Administrative Agent funds for any Loan to be made by such Lender as provided in the foregoing
provisions of this Article II, and such funds are not made available to the Borrower by
the Administrative Agent because the conditions to the applicable Borrowing set forth in
Article IV are not satisfied or waived in accordance with the terms hereof, the
Administrative Agent shall promptly return such funds (in like funds as received from such Lender)
to such Lender, without interest.

     (d) Obligations of Lenders Several. The obligations of the Lenders hereunder to make
Loans and to make payments pursuant to Section 10.04(c) are several and not joint. The
failure of any Lender to make any Loan or to make any payment under Section 10.04(c) on any
date required hereunder shall not relieve any other Lender of its corresponding obligation to do so
on such date, and no Lender shall be responsible for the failure of any other Lender to so make its
Loan or to make its payment under Section 10.04(c).

     (e) Funding Source. Nothing herein shall be deemed to obligate any Lender to obtain
the funds for any Loan in any particular place or manner or to constitute a representation by any

 	 	 	 
	 	20	Credit Agreement

 

Lender that it has obtained or will obtain the funds for any Loan in any particular place or
manner.

     2.11 Sharing of Payments by Lenders. If any Lender shall, by exercising any right of setoff
or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of
the Loans made by it resulting in such Lender’s receiving payment of a proportion of the aggregate
amount of such Loans and accrued interest thereon greater than its pro rata share
thereof as provided herein, then the Lender receiving such greater proportion shall (a) notify the
Administrative Agent of such fact and (b) purchase (for cash at face value) participations in the
Loans of the other Lenders, or make such other adjustments as shall be equitable, 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 other amounts
owing them; 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 Section shall not be construed to apply to (x) any payment
made by the Borrower pursuant to and in accordance with the express terms of this Agreement
or (y) any payment obtained by a Lender as consideration for the assignment of or sale of a
participation in any of its Loans, other than to the Borrower or any Subsidiary thereof (as
to which the provisions of this Section shall apply).

     The Borrower consents to the foregoing and agrees, to the extent it may effectively do so
under applicable law, that any Lender acquiring a participation pursuant to the foregoing
arrangements may exercise against the Borrower rights of setoff and counterclaim with respect to
such participation as fully as if such Lender were a direct creditor of the Borrower in the amount
of such participation.

Article III.

TAXES, YIELD PROTECTION AND ILLEGALITY

     3.01 Taxes.

     (a) Payments Free of Taxes. Any and all payments by or on account of any obligation of the Borrower hereunder or under any other Loan Document
shall be made free and clear of and without reduction or withholding for any Indemnified Taxes or Other Taxes; provided that if the
 Borrower shall be required by applicable law to deduct any Indemnified Taxes (including any Other Taxes) from such
 payments, then (i) the sum payable 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 deductions been made, (ii) the Borrower shall make
such deductions and (iii) the Borrower shall timely pay the full amount deducted to the relevant Governmental Authority in accordance with applicable law.

	 	 	 
	 	21	Credit Agreement

 

     (b) Payment of Other Taxes by the Borrower. Without limiting the provisions of
subsection (a) above, the Borrower shall timely pay any Other Taxes to the relevant Governmental
Authority in accordance with applicable law.

     (c) Indemnification by the Borrower. The Borrower shall indemnify the Administrative
Agent and each Lender, within 10 days after demand therefor (which demand shall be accompanied by
documentation, in reasonable detail, supporting such demand), for the full amount of any
Indemnified Taxes or Other Taxes (including Indemnified Taxes or Other 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 were correctly or
legally imposed or asserted by the relevant Governmental Authority. A certificate setting forth in
reasonable detail the amount of such payment or liability, delivered to the Borrower by a Lender
(with a copy to the Administrative Agent), or by the Administrative Agent on its own behalf or on
behalf of a Lender, shall be conclusive absent demonstrable error.

     (d) Evidence of Payments. Promptly after any payment of Indemnified Taxes or Other
Taxes by the Borrower to a Governmental Authority, the Borrower 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.

     (e) Status of Lenders. Any Foreign Lender that is entitled to an exemption from or
reduction of withholding tax under the law of the jurisdiction in which the Borrower is resident
for tax purposes, or any treaty to which such jurisdiction is a party, with respect to payments
hereunder or under any other Loan Document shall deliver to the Borrower (with a copy to the
Administrative Agent), at the time or times prescribed by applicable law or reasonably requested by
the Borrower 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 of withholding. In addition, any Lender, if requested by the Borrower or the
Administrative Agent, shall deliver such other documentation prescribed by applicable law or
reasonably requested by the Borrower or the Administrative Agent as will enable the Borrower or the
Administrative Agent to determine whether or not such Lender is subject to backup withholding or
information reporting requirements.

     Without limiting the generality of the foregoing, in the event that the Borrower is resident
for tax purposes in the United States, any Foreign Lender shall deliver to the Borrower and the
Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior
to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to
time thereafter upon the request of the Borrower or the Administrative Agent, but only if such
Foreign Lender is legally entitled to do so), whichever of the following is applicable:

     (i) duly completed copies of Internal Revenue Service Form W-8BEN claiming eligibility
for benefits of an income tax treaty to which the United States is a party,

 	 	 	 
	 	22	Credit Agreement

 

     (ii) duly completed copies of Internal Revenue Service Form W-8ECI,

     (iii) in the case of a Foreign Lender claiming the benefits of the exemption for
portfolio interest under section 881(c) of the Code, (x) a certificate to the effect that
such Foreign 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 Borrower within the meaning of section
881(c)(3)(B) of the Code, or (C) a “controlled foreign corporation” described in section
881(c)(3)(C) of the Code and (y) duly completed copies of Internal Revenue Service Form
W-8BEN, or

     (iv) any other form prescribed by applicable law as a basis for claiming exemption from
or a reduction in United States Federal withholding tax duly completed together with such
supplementary documentation as may be prescribed by applicable law to permit the Borrower to
determine the withholding or deduction required to be made.

     (f) Treatment of Certain Refunds. If the Administrative Agent or any Lender
determines, in its sole discretion, that it has received a refund of any Indemnified Taxes or Other
Taxes as to which it has been indemnified by the Borrower or with respect to which the
Borrower has paid additional amounts pursuant to this Section, it shall pay to the Borrower an
amount equal to such refund (but only to the extent of indemnity payments made, or additional
amounts paid, by the Borrower under this Section with respect to the Indemnified Taxes or Other
Taxes giving rise to such refund), net of all out-of-pocket expenses of the Administrative Agent or
such Lender, as the case may be, and without interest (other than any interest paid by the relevant
Governmental Authority with respect to such refund), provided that the Borrower, upon the
request of the Administrative Agent or such Lender, agrees to repay the amount paid over to the
Borrower (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 subsection 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 that it deems confidential) to the Borrower or any
other Person.

     3.02 Illegality. If any Lender determines that any Law has made it unlawful, or that any
Governmental Authority has asserted that it is unlawful, for any Lender or its applicable Lending
Office to make, maintain or fund Eurodollar Rate Loans, or to determine or charge interest rates
based upon the Eurodollar Rate, or any Governmental Authority has imposed material restrictions on
the authority of such Lender to purchase or sell, or to take deposits of, Dollars in the London
interbank market, then, on notice thereof by such Lender to the Borrower through the Administrative
Agent, any obligation of such Lender to make or continue Eurodollar Rate Loans or to convert Base
Rate Loans to Eurodollar Rate Loans shall be suspended until such Lender notifies the
Administrative Agent and the Borrower that the circumstances giving rise to such determination no
longer exist. Upon receipt of such notice, the Borrower shall, upon demand from such Lender (with
a copy to the Administrative Agent), prepay or, if applicable, convert all Eurodollar Rate Loans of
such Lender to Base Rate Loans, either on the last day of the Interest Period therefor, if such
Lender may lawfully continue to maintain

 	 	 	 
	 	23	Credit Agreement

 

such Eurodollar Rate Loans to such day, or immediately, if
such Lender may not lawfully continue to maintain such Eurodollar Rate Loans. Upon any such
prepayment or conversion, the Borrower shall also pay accrued interest on the amount so prepaid or
converted.

     3.03 Inability to Determine Rates. If the Required Lenders determine and advise the Administrative
Agent that for any reason in connection with any request for a Eurodollar Rate Loan or a conversion
to or continuation thereof that (a) Dollar deposits are not being offered to banks in the London
interbank eurodollar market for the applicable amount and Interest Period of such Eurodollar Rate
Loan, (b) adequate and reasonable means do not exist for determining the Eurodollar Rate for any
requested Interest Period with respect to a proposed Eurodollar Rate Loan or (c) the Eurodollar
Rate for any requested Interest Period with respect to a proposed Eurodollar Rate Loan does not
adequately and fairly reflect the cost to such Lenders of funding such Loan, the Administrative
Agent will promptly so notify the Borrower and each Lender. Thereafter, the obligation of the
Lenders to make or maintain Eurodollar Rate Loans shall be suspended until the Administrative Agent
(upon the instruction of the Required Lenders) revokes such notice, which
notice and instruction to give such notice shall be given promptly after the cessation of the
foregoing condition which resulted in the notice referred to in the immediately preceding sentence
having been given to the Borrower and each Lender. Upon receipt of such notice, the Borrower may
revoke any pending request for a Borrowing of, conversion to or continuation of Eurodollar Rate
Loans or, failing that, will be deemed to have converted such request into a request for a
Borrowing of Base Rate Loans in the amount specified therein.

     3.04 Increased Costs; Reserves on Eurodollar Rate Loans.

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

     (i) impose, modify or deem applicable any reserve, special deposit, compulsory loan,
insurance charge or similar requirement against assets of, deposits with or for the account
of, or credit extended or participated in by, any Lender (except any reserve requirement
contemplated by Section 3.04(e));

     (ii) subject any Lender to any tax of any kind whatsoever with respect to this
Agreement or any Eurodollar Loan made by it, or change the basis of taxation of payments to
such Lender in respect thereof (except for Indemnified Taxes or Other Taxes covered by
Section 3.01 and the imposition of, or any change in the rate of, any Excluded Tax
payable by such Lender); or

     (iii) impose on any Lender or the London interbank market any other condition, cost or
expense affecting this Agreement or Eurodollar Loans made by such Lender;

and the result of any of the foregoing shall be to increase the cost to such Lender of making or
maintaining any 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 any other amount), then, upon request therefor of such Lender, the Borrower will pay to
such Lender, such additional amount or amounts as will compensate such Lender for such additional
costs incurred or reduction suffered.

	 	 	 
	 	24	Credit Agreement

 

     (b) Capital Requirements. If any Change in Law affecting any Lender or any Lending
Office of such Lender or such Lender’s holding company, if any, regarding capital requirements has
or would have the effect of reducing, by an amount deemed by such Lender to be material, 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, the Commitments of such Lender 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), then from time to time the Borrower
will, upon the request of such Lender, 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 for Reimbursement. A certificate of a Lender setting forth, in
reasonable detail, the amount or amounts necessary to compensate such Lender or its holding
company, as the case may be, as specified in subsection (a) or (b) of this Section and delivered to
the Borrower shall be conclusive absent demonstrable error. The Borrower shall pay such
Lender the amount shown as due on any such certificate within 30 days after receipt thereof.

     (d) Delay in Requests. Failure or delay on the part of any Lender to demand
compensation pursuant to the foregoing provisions of this Section shall not constitute a waiver of
such Lender’s right to demand such compensation; provided that the Borrower shall not be
required to compensate a Lender pursuant to the foregoing provisions of this Section for any
increased costs incurred or reductions suffered more than six months prior to the date that such
Lender notifies the Borrower of the Change in Law giving rise to such increased costs or reductions
and of such Lender’s intention to claim compensation therefor (except that, if the Change in Law
giving rise to such increased costs or reductions is retroactive, then the nine-month period
referred to above shall be extended to include the period of retroactive effect thereof).

     (e) Reserves on Eurodollar Rate Loans. The Borrower shall pay to each Lender, as long
as such Lender shall be required to maintain reserves with respect to liabilities or assets
consisting of or including Eurocurrency funds or deposits (currently known as “Eurocurrency
liabilities”), which are greater than such reserves required on the date of this Agreement,
additional interest on the unpaid principal amount of each Eurodollar Rate Loan equal to the actual
costs of such increased reserves allocated to such Loan by such Lender (as determined by such
Lender in good faith, which determination shall be conclusive), which shall be due and payable on
each date on which interest is payable on such Loan; provided the Borrower shall have
received at least 30 days’ prior notice (with a copy to the Administrative Agent) of such
additional interest from such Lender. If a Lender fails to give notice at least 30 days prior to
the relevant Interest Payment Date, such additional interest shall be due and payable 30 days from
receipt of such notice.

     3.05 Compensation for Losses. Upon demand (which demand shall be accompanied by documentation in
reasonable detail supporting such demand) of any Lender (with a copy to the Administrative Agent)
from time to time, the Borrower shall promptly compensate such Lender for and hold such Lender
harmless from any loss, cost or expense incurred by it as a result of:

 	 	 	 
	 	25	Credit Agreement

 

     (a) any continuation, conversion, payment or prepayment of any Loan other than a Base Rate
Loan on a day other than the last day of the Interest Period for such Loan (whether voluntary,
mandatory, automatic, by reason of acceleration, or otherwise);

     (b) any failure by the Borrower (for a reason other than the failure of such Lender to make a
Loan) to prepay, borrow, continue or convert any Loan other than a Base Rate Loan on the date or in
the amount notified by the Borrower; or

     (c) any assignment of a Eurodollar Rate Loan on a day other than the last day of the Interest
Period therefor as a result of a request by the Borrower pursuant to Section 10.13;

including any loss of anticipated profits and any loss or expense arising from the liquidation or
reemployment of funds obtained by it to maintain such Loan or from fees payable to terminate
the deposits from which such funds were obtained. The Borrower shall also pay any customary
administrative fees charged by such Lender in connection with the foregoing.

For purposes of calculating amounts payable by the Borrower to the Lenders under this Section
3.05, each Lender shall be deemed to have funded each Eurodollar Rate Loan made by it at the
Eurodollar Rate for such Loan by a matching deposit or other borrowing in the London
interbank
eurodollar market for a comparable amount and for a comparable period, whether or not such
Eurodollar Rate Loan was in fact so funded.

     3.06 Mitigation Obligations; Replacement of Lenders.

     (a) Designation of a Different Lending Office. If any Lender requests compensation
under Section 3.04, or the Borrower is required to pay any additional amount to any Lender
or any Governmental Authority for the account of any Lender pursuant to Section 3.01, or if
any Lender gives a notice pursuant to Section 3.02, then such Lender shall use reasonable
efforts to designate a different Lending Office for funding or booking its Loans hereunder or to
assign its rights and obligations hereunder to another of its offices, branches or affiliates, if,
in the judgment of such Lender, such designation or assignment (i) would eliminate or reduce
amounts payable pursuant to Section 3.01 or 3.04, as the case may be, in the
future, or eliminate the need for the notice pursuant to Section 3.02, as applicable, and
(ii) in each case, would not subject such Lender to any unreimbursed cost or expense and would not
otherwise be disadvantageous to such Lender. The Borrower hereby agrees to pay all reasonable
costs and expenses incurred by any Lender in connection with any such designation or assignment.

     (b) Replacement of Lenders. If any Lender requests compensation under Section
3.04, or if the Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 3.01, the Borrower
may replace such Lender in accordance with Section 10.13.

     3.07 Survival. All of the Borrower’s obligations under this Article III shall survive
termination of the Aggregate Commitments and repayment of all other Obligations hereunder.

 	 	 	 
	 	26	Credit Agreement

 

ARTICLE IV.

CONDITIONS PRECEDENT TO BORROWINGS

     4.01 Conditions of Initial Borrowing. The obligation of each Lender to make its initial Loan
hereunder is subject to satisfaction of the following conditions precedent:

     (a) The Administrative Agent’s receipt of the following, each of which shall be originals or
telecopies (followed promptly by originals) unless otherwise specified, each properly executed by a
Responsible Officer of the Borrower, each dated the Closing Date (or, in the case of certificates
of governmental officials, a recent date before the Closing Date) and each in form and substance
satisfactory to the Administrative Agent and each of the Lenders:

     (i) executed counterparts of this Agreement, sufficient in number for distribution to
the Administrative Agent, each Lender and the Borrower;

     (ii) a Note executed by the Borrower in favor of each Lender requesting a Note;

     (iii) a certificate of the Borrower, signed on its behalf by a Responsible Officer, as
to its Organizational Documents and such certificates of resolutions or other action,
incumbency certificates and/or other certificates of the Responsible Officers of the
Borrower as the Administrative Agent may request evidencing the identity, authority and
capacity of each Responsible Officer thereof authorized to act as a Responsible Officer in
connection with this Agreement and the other Loan Documents;

     (iv) such documents and certifications as the Administrative Agent may reasonably
request to evidence that the Borrower is duly organized or formed, and that the Borrower is
validly existing, in good standing and qualified to engage in business in the State of
Pennsylvania;

     (v) a favorable opinion of Wolf, Block, Schorr and Solis-Cohen, LLP, counsel to the
Borrower, addressed to the Administrative Agent and each Lender, in form and substance
satisfactory to the Administrative Agent and the Required Lenders;

     (vi) a certificate of the Borrower, signed on its behalf by a Responsible Officer,
certifying (A) that the conditions specified in Sections 4.02(a) and (b)
have been satisfied, and (B) that there has been no event or circumstance since December 31,
2005 that has had or could be reasonably expected to have, either individually or in the
aggregate, a Material Adverse Effect; and

     (vii) such other assurances, certificates, documents, consents or opinions as the
Administrative Agent or the Required Lenders reasonably may request.

     (b) Any fees required to be paid on or before the Closing Date pursuant to the Fee Letter
shall have been paid.

     (c) Unless waived by the Administrative Agent, the Borrower shall have paid all fees, charges
and disbursements of counsel to the Administrative Agent to the extent invoiced prior to

 	 	 	 
	 	27	Credit Agreement

 

or on the
Closing Date, plus such additional amounts of such fees, charges and disbursements as shall
constitute its reasonable estimate of such fees, charges and disbursements incurred or to be
incurred by it through the closing proceedings; provided that such estimate shall not
thereafter preclude a final settling of accounts between the Borrower and the Administrative Agent.

     Without limiting the generality of the provisions of Section 9.04, for purposes of
determining compliance with the conditions specified in this Section 4.01, each Lender that
has signed this Agreement shall be deemed to have consented to, approved or accepted or to be
satisfied with, each document or other matter required thereunder to be consented to or approved by
or acceptable or satisfactory to a Lender unless the Administrative Agent shall have received
notice from such Lender prior to the proposed Closing Date specifying its objection thereto.

     4.02 Conditions to all Borrowings. The obligation of each Lender to honor any Loan Notice (other
than a Loan Notice requesting only a conversion of Loans to the other Type, or a continuation of
Eurodollar Rate Loans) is subject to the following conditions precedent:

     (a) The representations and warranties of the Borrower contained in Article V or any
other Loan Document, or which are contained in any document furnished at any time under or in
connection herewith or therewith, shall be true and correct in all material respects
(provided that any representation or warranty that is expressly qualified as to materiality
or Material Adverse Effect shall be true and correct in all respects) on and as of the date of such
Borrowing, except (i) to the extent that such representations and warranties specifically refer to
an earlier date, in which case they shall be true and correct as of such earlier date, (ii) for
purposes of this Section 4.02, the representations and warranties contained in subsections
(a) and (b) of Section 5.05 shall be deemed to refer to the most recent statements
furnished pursuant to clauses (a) and (b), respectively, of Section 6.01, and (iii) for any
changes in such representations and warranties that result from acts or omissions of the Borrower
that do not constitute a breach of this Agreement.

     (b) No Default shall exist, or would result from such proposed Borrowing or from the
application of the proceeds thereof.

     (c) The Administrative Agent shall have received a Loan Notice in accordance with the
requirements hereof.

     Each Loan Notice (other than a Loan Notice requesting only a conversion of Loans to the other
Type or a continuation of Eurodollar Rate Loans) submitted by the Borrower shall be deemed to be a
representation and warranty that the conditions specified in Sections 4.02(a) and
(b) have been satisfied on and as of the date of the applicable Borrowing.

ARTICLE V.

REPRESENTATIONS AND WARRANTIES

     The Borrower represents and warrants to the Administrative Agent and the Lenders that:

     5.01 Existence, Qualification and Power; Compliance with Laws. Each of the Borrower and its
Significant Subsidiaries (a) is duly organized or formed, validly existing and in

 	 	 	 
	 	28	Credit Agreement

 

good standing
under the Laws of the jurisdiction of its incorporation or organization, (b) has all requisite
power and authority and all requisite governmental licenses, authorizations, consents and approvals
to (i) own or lease its assets and carry on its business and (ii) execute, deliver and perform its
obligations under the Loan Documents (in the case of the Borrower), (c) is duly qualified and is
licensed and in good standing under the Laws of each jurisdiction where its ownership, lease or
operation of properties or the conduct of its business requires such qualification or license and
(d) is in compliance with all Laws, except in each case
referred to in clause (b)(i), (c) or (d), to the extent that failure to do so could not
reasonably be expected to have a Material Adverse Effect.

     5.02 Authorization; No Contravention. The execution, delivery and performance by the Borrower of
each Loan Document have been duly authorized by all necessary corporate or other organizational
action, and do not and will not (a) contravene the terms of any of the Borrower’s Organization
Documents, (b) conflict
with or result in any breach or contravention of, or the creation of any
Lien under, or require any payment to be made under (i) any Contractual Obligation to which the
Borrower or any of its Significant Subsidiaries is a party or (ii) any order, injunction, writ or
decree of any Governmental Authority or any arbitral award to which the Borrower or any of its
Significant Subsidiaries is subject or (c) violate any Law, except to the extent that any conflict,
breach, contravention, creation, requirement or violation described in clause (b) or (c) could not
reasonably be expected to have a Material Adverse Effect. Each of the Borrower and its Significant
Subsidiaries is in compliance with all Contractual Obligations referred to in clause (b)(i), except
to the extent that failure to do so could not reasonably be expected to have a Material Adverse
Effect.

     5.03 Governmental Authorization; Other Consents. No approval, consent, exemption, authorization,
or other action by, or notice to, or filing with, any Governmental Authority or any other Person is
necessary or required to be obtained by the Borrower in connection with the execution, delivery or
performance by, or enforcement against, the Borrower of this Agreement or any other Loan Document,
except as has been obtained or made and is in full force and effect.

     5.04 Binding Effect. This Agreement has been, and each other Loan Document, when delivered
hereunder, will have been, duly executed and delivered by the Borrower. This Agreement
constitutes, and each other Loan Document when so delivered will constitute, a legal, valid and
binding obligation of the Borrower, enforceable against the Borrower in accordance with its terms,
except as enforceability may be limited by applicable Debtor Relief Laws affecting the enforcement
of creditors’ rights generally or by general equitable principles.

     5.05 Financial Statements; No Material Adverse Effect.

     (a) The Audited Financial Statements (i) were prepared in accordance with GAAP consistently
applied throughout the period covered thereby, except as otherwise expressly noted therein, and
(ii) fairly present in all material respects the financial condition of the Borrower and its
Subsidiaries as of the date thereof and their results of operations for the period covered thereby
in accordance with GAAP consistently applied throughout the period covered thereby, except as
otherwise expressly noted therein.

 	 	 	 
	 	29	Credit Agreement

 

     (b) Since December 31, 2005, there has been no event or circumstance, either individually or
in the aggregate, that has had or could reasonably be expected to have a Material Adverse Effect.

     (c) The Annual Statements of PIC and PIIC for the fiscal year ended December 31, 2005,
heretofore filed with the applicable Department and delivered to the Lenders, have been prepared in
accordance with SAP and fairly present in all material respects the financial conditions of such
Persons as of the dates thereof and their results of operations for the periods covered thereby in
accordance with SAP consistently applied throughout the periods covered thereby, except as
expressly noted therein.

     5.06 Litigation. There are no actions, suits, proceedings, claims or disputes pending or, to the
knowledge of the Borrower, threatened or contemplated, at law, in equity, in arbitration or before
any Governmental Authority, by or against the Borrower or any of its Significant Subsidiaries or
against any of their properties or revenues that (a) purport to affect or pertain to this Agreement
or any other Loan Document, or any of the transactions contemplated hereby or (b) except as
specifically disclosed in Schedule 5.06, either individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.

     5.07 No Default. Neither the Borrower nor any of its Significant Subsidiaries is in default under
or with respect to any Contractual Obligation that could, either individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect. No Default has occurred and is
continuing or would result from the consummation of the transactions contemplated by this Agreement
or any other Loan Document.

     5.08 Ownership of Property; Liens. Each of the Borrower and its Significant Subsidiaries has good
record and marketable title in fee simple to, or valid leasehold interests in, all real property
necessary or used in the ordinary conduct of its business, except for such defects in title as
could not, individually or in the aggregate, reasonably be expected to have a Material Adverse
Effect. The property of the Borrower and its Significant Subsidiaries is subject to no Liens,
other than Liens permitted by Section 7.01.

     5.09 Environmental Compliance. Neither the Borrower nor any of its Significant Subsidiaries is in
violation of any Environmental Law that could individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.

     5.10 Insurance. The properties of the Borrower and its Significant Subsidiaries are insured with
financially sound and reputable insurance companies not Affiliates of the Borrower, in such amounts
(after giving effect to any self-insurance) with such deductibles and covering such risks as are
customarily carried by companies engaged in similar businesses and owning similar properties in
localities where the Borrower or the applicable Significant Subsidiary operates.

     5.11 Taxes. The Borrower and its Significant Subsidiaries have filed all Federal, state and other
material tax returns and reports required to be filed, and have paid all Federal, state and other
material taxes, assessments, fees and other governmental charges levied or imposed upon them or
their properties, income or assets otherwise due and payable, except those (a) which are

 	 	 	 
	 	30	Credit Agreement

 

being
contested in good faith by appropriate proceedings diligently conducted and for which adequate
reserves have been provided in accordance with GAAP, and (b) the failure to file or pay could not
reasonably be expected to have a Material Adverse Effect. There is no proposed tax assessment
against the Borrower or any Significant Subsidiary that could, if made, reasonably be expected to
have a Material Adverse Effect.

     5.12 ERISA Compliance.

     (a) Each Plan is in compliance in all material respects with the applicable provisions of
ERISA, the Code and other Federal or state Laws.

     (b) There are no pending or, to the best knowledge of the Borrower, threatened claims, actions
or lawsuits, or action by any Governmental Authority, with respect to any Plan that could
reasonably be expected to have a Material Adverse Effect. There has been no prohibited transaction
or violation of the fiduciary responsibility rules with respect to any Plan that has resulted or
could reasonably be expected to result in a Material Adverse Effect.

     (c) Except to the extent that such matter could not reasonably be expected to have a Material
Adverse Effect, (i) No ERISA Event has occurred or is reasonably expected to occur, (ii) no Pension
Plan has any Unfunded Pension Liability, (iii) neither the Borrower nor any ERISA Affiliate has
incurred, or reasonably expects to incur, any liability under Title IV of ERISA with respect to any
Pension Plan (other than premiums due and not delinquent under Section 4007 of ERISA), (iv) neither
the Borrower nor any ERISA Affiliate has incurred, or reasonably expects to incur, any liability
(and no event has occurred which, with the giving of notice under Section 4219 of ERISA, would
result in such liability) under Sections 4201 or 4243 of ERISA with respect to a Multiemployer
Plan, and (v) neither the Borrower nor any ERISA Affiliate has engaged in a transaction that could
be subject to Sections 4069 or 4212(c) of ERISA.

     5.13 Subsidiaries. As of the Closing Date, the Borrower has no Significant Subsidiaries other than
those set forth on Schedule 5.13, and all of the outstanding equity interests in such
Significant Subsidiaries have been validly issued, are fully paid and nonassessable and are owned
by the Borrower or one of its Significant Subsidiaries, free and clear of all Liens.

     5.14 Margin Regulations; Investment Company Act; Public Utility Holding Company Act.

     (a) The Borrower is not engaged and will not engage, principally or as one of its important
activities, in the business of purchasing or carrying margin stock (within the meaning of
Regulation U issued by the FRB), or extending credit for the purpose of purchasing or
carrying margin stock. Following the application of the proceeds of each Borrowing, not more
than 25% of the value of the assets (either of the Borrower only or of the Borrower and its
Subsidiaries on a consolidated basis) subject to the provisions of Section 7.01 or
Section 7.05 or subject to any restriction contained in any agreement or instrument between
the Borrower and any Lender or any Affiliate of any Lender relating to indebtedness and within the
scope of Section 8.01(e) will be margin stock.

 	 	 	 
	 	31	Credit Agreement

 

     (b) None of the Borrower, any Person Controlling the Borrower, or any Subsidiary (i) is a
“holding company,” or a “subsidiary company” of a “holding company,” or an “affiliate” of a
“holding company” or of a “subsidiary company” of a “holding company,” within the meaning of the
Public Utility Holding Company Act of 1935, or (ii) is or is required to be registered as an
“investment company” under the Investment Company Act of 1940.

     5.15 Disclosure. No report, financial statement, certificate or other information furnished
(whether in writing or orally) by or on behalf of the Borrower or any of its Significant
Subsidiaries to the Administrative Agent or any Lender in connection with the transactions
contemplated hereby and the negotiation of this Agreement or delivered hereunder or under any other
Loan Document (in each case, as modified or supplemented by other information so furnished)
contains any material misstatement of fact or omits 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, the Borrower
represents only that such information was prepared in good faith based upon assumptions believed to
be reasonable at the time.

     5.16 Compliance with Laws. Each of the Borrower and its Significant Subsidiaries is in compliance
in all material respects with the requirements of all Laws and all orders, writs, injunctions and
decrees applicable to it or to its properties, except in such instances in which (a) such
requirement of Law or order, writ, injunction or decree is being contested in good faith by
appropriate proceedings diligently conducted or (b) the failure to comply therewith, either
individually or in the aggregate, could not reasonably be expected to have a Material Adverse
Effect.

     5.17 Intellectual Property; Licenses, Etc. Each of the Borrower and its Significant Subsidiaries
owns, or possesses the right to use, all of the trademarks, service marks, trade names, copyrights,
patents, patent rights, franchises, licenses and other intellectual property rights that are
reasonably necessary for the operation of its respective businesses, without conflict with the
rights of any other Person, except to the extent the failure to do so could not reasonably be
expected to have a Material Adverse Effect. To the best knowledge of the Borrower, no slogan or
other advertising device, product, process, method, substance, part or other material now employed,
or now contemplated to be employed, by the Borrower or any Subsidiary infringes upon any rights
held by any other Person, except to the extent such infringement so could not reasonably be
expected to have a Material Adverse Effect.

     5.18 Insurance Licenses. Each Insurance Subsidiary that is a Significant Subsidiary has obtained and maintains in full
force and effect all licenses and permits from its Department and all other Governmental
Authorities necessary to operate in the jurisdictions in which it operates, in each case other than
such licenses and permits the failure to obtain or maintain, individually or in the aggregate,
could not reasonably be expected to have a Material Adverse Effect.

 	 	 	 
	 	32	Credit Agreement

 

ARTICLE VI.

AFFIRMATIVE COVENANTS

     So long as any Lender shall have any Commitment hereunder or any Loan or other Obligation
hereunder shall remain unpaid or unsatisfied, the Borrower shall, and shall (except in the case of
the covenants set forth in Sections 6.01, 6.02, and 6.03) cause each
Significant Subsidiary to:

     6.01 Financial Statements. Deliver to the Administrative Agent and each Lender, in form and detail
satisfactory to the Administrative Agent and the Required Lenders:

     (a) within 90 days after the end of each fiscal year of the Borrower, a consolidated balance
sheet of the Borrower and its Subsidiaries as at the end of such fiscal year, and the related
consolidated statements of income or operations, shareholders’ equity and cash flows for such
fiscal year, setting forth in each case in comparative form the figures for the previous fiscal
year, all in reasonable detail and prepared in accordance with GAAP, audited and accompanied by (i)
a report and opinion of a Registered Public Accounting Firm of nationally recognized standing
reasonably acceptable to the Required Lenders, which report and opinion shall be prepared in
accordance with generally accepted auditing standards and applicable Securities Laws and shall not
be subject to any “going concern” or like qualification or exception or any qualification or
exception as to the scope of such audit and (ii) an attestation report of such Registered Public
Accounting Firm as to the Borrower’s internal controls pursuant to Section 404 of Sarbanes-Oxley;

     (b) within 45 days after the end of each of the first three fiscal quarters of each fiscal
year of the Borrower, a consolidated balance sheet of the Borrower and its Subsidiaries as at the
end of such fiscal quarter, and the related consolidated statements of income or operations,
shareholders’ equity and cash flows for such fiscal quarter and for the portion of the Borrower’s
fiscal year then ended, setting forth in each case in comparative form the figures for the
corresponding fiscal quarter of the previous fiscal year and the corresponding portion of the
previous fiscal year, all in reasonable detail, certified by the Borrower, pursuant to a
certificate signed by a Responsible Officer on behalf of the Borrower, as fairly presenting the
financial condition, results of operations, shareholders’ equity and cash flows of the Borrower and
its Subsidiaries in accordance with GAAP, subject only to normal year-end audit adjustments and the
absence of footnotes;

     (c) within 90 days after the end of each fiscal year of PIC and PIIC, a copy of the Annual
Statement of each such Person for such fiscal year, as filed with the applicable Department,
prepared in accordance with SAP; and

     (d) within 60 days after the end of each of the first three fiscal quarters of each fiscal
quarter of PIC and PIIC, a copy of the quarterly financial statement of each such Person for such
fiscal quarter, as filed with the applicable Department, prepared in accordance with SAP.

As to any information contained in materials furnished pursuant to Section 6.02(c), the
Borrower shall not be separately required to furnish such information under clause (a) or (b)
above, but the

 	 	 	 
	 	33	Credit Agreement

 

foregoing shall not be in derogation of the obligation of the Borrower to furnish
the information and materials described in clauses (a) and (b) above at the times specified
therein.

     6.02 Certificates; Other Information. Deliver to the Administrative Agent and each Lender, in form
and detail reasonably satisfactory to the Administrative Agent and the Required Lenders:

     (a) concurrently with the delivery of the financial statements referred to in Sections
6.01(a) and (b) a duly completed Compliance Certificate signed on the Borrower’s behalf
by a Responsible Officer of the Borrower;

     (b) promptly after any request by the Administrative Agent or any Lender, copies of any
detailed audit reports, management letters or recommendations submitted to the board of directors
(or the audit committee of the board of directors) of the Borrower by independent accountants in
connection with the accounts or books of the Borrower or any Subsidiary, or any audit of any of
them;

     (c) promptly after the same are available, copies of each annual report, proxy or financial
statement or other report or communication sent to the stockholders of the Borrower, and copies of
all annual, regular, periodic and special reports and registration statements which the Borrower
may file or be required to file with the SEC under Section 13 or 15(d) of the Securities Exchange
Act of 1934 or which any Insurance Subsidiary may file or be required to file with the applicable
Department (including each Statement of Actuarial Opinion), and not otherwise required to be
delivered to the Administrative Agent pursuant hereto; and

     (d) promptly, such additional information regarding the business, financial or corporate
affairs of the Borrower or any Subsidiary, or compliance with the terms of the Loan Documents, as
the Administrative Agent or any Lender through the Administrative Agent may from time to time
reasonably request.

     Documents required to be delivered pursuant to Section 6.01(a) or (b) or
Section 6.02(d) (to the extent any such documents are included in materials otherwise filed
with the SEC) may be delivered electronically and if so delivered, shall be deemed to have been
delivered on the date (i) on which the Borrower posts such documents, or provides a link thereto on
the Borrower’s website on the Internet at the website address listed on Schedule 10.02 or
(ii) on which such documents are posted on the Borrower’s behalf on an Internet or intranet
website, if any, to which each Lender and the Administrative Agent have access (whether a
commercial, third-party website or whether sponsored by the Administrative Agent); provided
that: (i) the Borrower shall deliver paper copies of such documents to the Administrative Agent or
any Lender that requests the Borrower to deliver such paper copies until a written request to cease
delivering paper copies is given by the Administrative Agent or such Lender and (ii) the
Borrower shall notify the Administrative Agent and each Lender (by telecopier or electronic
mail) of the posting of any such documents and provide to the Administrative Agent by electronic
mail electronic versions (i.e., soft copies) of such documents. Notwithstanding anything
contained herein, in every instance the Borrower shall be required to provide paper copies of the
Compliance Certificates required by Section 6.02(b) to the Administrative Agent.
Except
for such Compliance Certificates, the Administrative Agent shall have no obligation to

 	 	 	 
	 	34	Credit Agreement

 

request the
delivery or to maintain copies of the documents referred to above, and in any event shall have no
responsibility to monitor compliance by the Borrower with any such request for delivery, and each
Lender shall be solely responsible for requesting delivery to it or maintaining its copies of such
documents.

     6.03 Notices. Promptly notify the Administrative Agent and each Lender:

     (a) of the occurrence of any Event of Default;

     (b) of any matter that has resulted or could reasonably be expected to result in a Material
Adverse Effect, including (i) breach or non-performance of, or any default under, a Contractual
Obligation of the Borrower or any Subsidiary, (ii) any dispute, litigation, investigation,
proceeding between the Borrower or any Subsidiary and any Department or other Governmental
Authority, (iii) any change in the Applicable Insurance Code or other Laws governing the investment
or dividend policies or practices of any Insurance Subsidiary, (iv) any suspension, termination or
revocation by any Department or other Governmental Authority of any license of any Insurance
Subsidiary to conduct business as an Insurance Subsidiary or the placing of any condition or
restriction thereon or (v) the commencement of, or any material development in, any litigation or
proceeding affecting the Borrower or any Subsidiary;

     (c) of the occurrence of any ERISA Event;

     (d) of any material change in accounting policies or financial reporting practices by the
Borrower or any Subsidiary; and

     (e) of any announcement by A. M. Best Company, Inc. of a downgrade in the financial strength
rating of any Insurance Subsidiary, within 10 days of such announcement.

     Each notice pursuant to this Section shall be accompanied by a statement of the Borrower,
signed by a Responsible Officer setting forth details of the occurrence referred to therein and
stating what action the Borrower has taken and proposes to take with respect thereto. Each notice
pursuant to Section 6.03(a) shall describe with particularity any and all provisions of
this Agreement and any other Loan Document that have been breached.

     6.04 Payment of Obligations. Pay and discharge as the same shall become due and payable, all its
obligations and liabilities, including (a) all tax liabilities, assessments and governmental
charges or levies upon it or its properties or assets, unless the same are being contested in good
faith by appropriate proceedings diligently conducted and adequate reserves in accordance with GAAP
are being
maintained by the Borrower or such Subsidiary, (b) all lawful claims which, if unpaid, would
by law become a Lien upon its property and (c) all indebtedness, as and when due and payable, but
subject to any subordination provisions contained in any instrument or agreement evidencing such
indebtedness, except to the extent that non-payment could not reasonably be expected to have a
Material Adverse Effect.

     6.05 Preservation of Existence, Etc. (a) Preserve, renew and maintain in full force and effect its
legal existence and good standing under the Laws of the jurisdiction of its organization except in
a transaction permitted by Section 7.03; (b) take all reasonable action to maintain all
rights, privileges, permits, licenses and franchises necessary or desirable in the

	 	 	 
	 	35	Credit Agreement

 

normal conduct
of its business, except to the extent that failure to do so could not reasonably be expected to
have a Material Adverse Effect; and (c) preserve or renew all of its registered patents,
trademarks, trade names and service marks, the non-preservation of which could reasonably be
expected to have a Material Adverse Effect.

     6.06 Maintenance of Properties. (a) Maintain, preserve and protect all of its material properties
and equipment necessary in the operation of its business in good working order and condition,
ordinary wear and tear excepted; and (b) make all necessary repairs thereto and renewals and
replacements thereof except where the failure to do any of the matters referred to in clauses (a)
and (b) could not reasonably be expected to have a Material Adverse Effect.

     6.07 Maintenance of Insurance. Maintain with financially sound and reputable insurance companies
not Affiliates of the Borrower, insurance with respect to its properties and business against loss
or damage of the kinds customarily insured against by Persons engaged in the same or similar
business, of such types and in such amounts (after giving effect to any self-insurance compatible
with the following standards) as are customarily carried under similar circumstances by such other
Persons.

     6.08 Compliance with Laws. Comply in all material respects with the requirements of all Laws and
all orders, writs, injunctions and decrees applicable to it or to its business or property, except
in such instances in which (a) such requirement of Law or order, writ, injunction or decree is
being contested in good faith by appropriate proceedings diligently conducted or (b) the failure to
comply therewith could not reasonably be expected to have a Material Adverse Effect.

     6.09 Books and Records. (a) Maintain proper books of record and account, in which full, true and
correct entries in conformity with GAAP (or SAP, as applicable) consistently applied shall be made
of all financial transactions and matters involving the assets and business of the Borrower or such
Subsidiary, as the case may be and (b) maintain such books of record and account in material
conformity with all applicable requirements of any Governmental Authority having regulatory
jurisdiction over the Borrower or such Subsidiary, as the case may be.

     6.10 Inspection Rights. Permit representatives and independent contractors of the Administrative
Agent and each Lender to visit and inspect any of its properties, to examine its corporate,
financial and operating
records, and make copies thereof or abstracts therefrom, and to discuss its
affairs, finances and accounts with its directors, officers, and independent public accountants,
all at such reasonable times during normal business hours, upon reasonable advance notice to the
Borrower, but not, as to the Administrative Agent or any Lender, more than two times in any
twelve-month period; provided, however, that when an Event of Default exists the
Administrative Agent or any Lender (or any of their respective representatives or independent
contractors) may do any of the foregoing at the expense of the Borrower at any time during normal
business hours and without advance notice.

     6.11 Use of Proceeds. Use the proceeds of the Borrowings for general corporate purposes, including
to make repurchases of the capital stock of the Borrower and to make capital

	 	 	 
	 	36	Credit Agreement

 

contributions to the
Borrower’s Subsidiaries, not in contravention of any Law or of any Loan Document.

ARTICLE VII.

NEGATIVE COVENANTS

     So long as any Lender shall have any Commitment hereunder or any Loan or other Obligation
hereunder shall remain unpaid or unsatisfied, the Borrower shall not, nor shall it permit any
Subsidiary to, directly or indirectly:

     7.01 Liens. Create, incur, assume or suffer to exist any Lien upon any of its property, assets or
revenues, whether now owned or hereafter acquired, other than the following:

     (a) Liens pursuant to any Loan Document;

     (b) Liens existing on the date hereof and any renewals, replacements, or extensions thereof;
provided that the property covered thereby is not changed and the obligations secured
thereby are not increased in connection therewith except by an amount equal to a reasonable premium
or other reasonable amount paid, and fees and expenses reasonably incurred, in connection with such
renewal, replacement, or extension and by an amount equal to any existing commitments unutilized in
connection with such obligations;

     (c) Liens for taxes not yet due or which are being contested in good faith and by appropriate
proceedings diligently conducted, if adequate reserves with respect thereto are maintained on the
books of the applicable Person in accordance with GAAP;

     (d) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or other like Liens
arising in the ordinary course of business which are not overdue for a period of more than 30 days
or which are being contested in good faith and by appropriate proceedings diligently conducted, if
adequate reserves with respect thereto are maintained on the books of the applicable Person in
accordance with GAAP;

     (e) pledges or deposits in the ordinary course of business in connection with workers’
compensation, unemployment insurance and other social security legislation, and as required under
insurance Laws or by insurance regulators, other than any Lien imposed by ERISA;

     (f) deposits to secure the performance of bids, trade contracts and leases (other than
Consolidated Funded Indebtedness), statutory obligations, surety and appeal bonds, performance
bonds and other obligations of a like nature incurred in the ordinary course of business;

     (g) easements, rights-of-way, restrictions and other similar encumbrances affecting real
property which, in the aggregate, are not substantial in amount, and which do not in any case
materially detract from the value of the property subject thereto or materially interfere with the
ordinary conduct of the business of the applicable Person;

 	 	 	 
	 	37	Credit Agreement

 

     (h) Liens arising by virtue of any contractual, statutory or common law provision relating to
banker’s liens, rights of set-off or similar rights and remedies as to deposit accounts or other
funds maintained with a creditor depository institution;

     (i) Liens securing judgments for the payment of money not constituting an Event of Default
under Section 8.01(h);

     (j) Liens securing Consolidated Funded Indebtedness permitted under Section 7.02
consisting of capital lease obligations, Synthetic Lease Obligations and purchase money
indebtedness;

     (k) Liens securing Consolidated Funded Indebtedness permitted under Section 7.02(c); and

     (l) other Liens securing Consolidated Funded Indebtedness or other obligations;
provided that the aggregate amount of such Consolidated Funded Indebtedness or other
obligations at any time outstanding does not exceed the Threshold Amount.

     7.02 Indebtedness. Create, incur, assume or suffer to exist any Consolidated Funded Indebtedness,
except:

     (a) Consolidated Funded Indebtedness under the Loan Documents;

     (b) Consolidated Funded Indebtedness outstanding on the date hereof and listed on Schedule
7.02 and any refinancings, refundings, renewals or extensions thereof; provided that
the amount of such Consolidated Funded Indebtedness is not increased at the time of such
refinancing, refunding, renewal or extension except by an amount equal to a reasonable premium
or other reasonable amount paid, and fees and expenses reasonably incurred, in connection with
such refinancing and by an amount equal to any existing commitments unutilized thereunder;

     (c) Consolidated Funded Indebtedness owing to the Federal Home Loan Bank;

     (d) Consolidated Funded Indebtedness of the Borrower in an aggregate principal amount up to
$150,000,000 issued in a private placement pursuant to Rule 144A or in a public offering, in either
case under the Securities Act of 1933, as amended;

     (e) other Consolidated Funded Indebtedness of the Subsidiaries of the Borrower, so long as the
principal amount of such Consolidated Funded Indebtedness at any time outstanding does not exceed
$25,000,000, in the aggregate, for all of the Subsidiaries of the Borrower; and

     (f) other Consolidated Funded Indebtedness of the Borrower, so long as no Event of Default
exists at the time of the incurrence thereof, or after giving effect thereto.

     7.03 Fundamental Changes. Merge, dissolve, liquidate, consolidate with or into another Person, or
Dispose of (whether in one transaction or in a series of transactions) all or substantially all of
the assets (whether now owned or hereafter acquired) of the Company and its Subsidiaries on a
consolidated basis to or in favor of any Person, except that, so long as no Default exists or would
result therefrom:

 	 	 	 
	 	38	Credit Agreement

 

     (a) any Subsidiary may merge with (i) the Borrower; provided that the Borrower shall
be the continuing or surviving Person, or (ii) any one or more other Subsidiaries; provided
that when any wholly-owned Subsidiary is merging with another Subsidiary, the wholly-owned
Subsidiary shall be the continuing or surviving Person; and

     (b) any Subsidiary may Dispose of all or substantially all of its assets (upon voluntary
liquidation or otherwise) to the Borrower or to another Subsidiary; provided that if the
transferor in such a transaction is a wholly-owned Subsidiary, then the transferee must either be
the Borrower or a wholly-owned Subsidiary.

     7.04 Change in Nature of Business. Engage in any material line of business substantially different
from those lines of business conducted by the Borrower and its Subsidiaries on the date hereof or
any business substantially related or incidental thereto.

     7.05 Transactions with Affiliates. Enter into any material transaction of any kind with any
Affiliate of the Borrower, whether or not in the ordinary course of business, other than on fair
and reasonable terms substantially as favorable to the Borrower or such Subsidiary as would be
obtainable by the Borrower or such Subsidiary at the time in a comparable arm’s length transaction
with a Person other than an Affiliate; provided that the foregoing restriction shall not
apply to transactions between or among the Borrower and any of its wholly-owned Subsidiaries or
between and
among any wholly-owned Subsidiaries so long as such transactions are in accordance with
applicable Laws.

     7.06 Contractual Limitation on Restricted Payments. Enter into any Contractual Obligation that
limits the ability of any Subsidiary to make Restricted Payments to the Borrower or to otherwise
transfer property to the Borrower, if such Contractual Obligation could reasonably be expected to
impair the ability of the Borrower to pay and perform its Obligations under the Loan Documents when
due.

     7.07
Use of Proceeds. Use the proceeds of any Borrowing, whether directly or indirectly, and
whether immediately, incidentally or ultimately, to purchase or carry margin stock (within the
meaning of Regulation U or Regulation X of the FRB) in violation of such Regulation U or Regulation
X.

     7.08 Financial Covenants.

     (a) Permit the Consolidated Leverage Ratio to be greater than .30 to 1.00 as of the end of any
fiscal quarter of the Borrower;

     (b) Permit PIC’s “Surplus as Regards Policyholders” (as reflected on each quarterly financial
statement or Annual Statement, as applicable, of PIC filed with the applicable Department) to be
less then $33,714,004 as of the end of any fiscal quarter of PIC; or

     (c) Permit PIIC’s “Surplus as Regards Policyholders” (as reflected on each quarterly financial
statement or Annual Statement, as applicable, of PIIC filed with the applicable Department) to be
less than $451,101,175 as of the end of any fiscal quarter of PIIC.

	 	 	 
	 	39	Credit Agreement

 

ARTICLE VIII.

EVENTS OF DEFAULT AND REMEDIES

     8.01 Events of Default. Any of the following shall constitute an Event of Default:

     (a) Non-Payment. The Borrower fails to pay (i) when and as required to be paid
herein, any amount of principal of any Loan, (ii) within three Business Days after the same becomes
due, any interest on any Loan or any fee due hereunder or (iii) within ten Business Days after the
same becomes due, any other amount payable hereunder or under any other Loan Document for which a
certificate, demand, invoice or other request for payment has been delivered to the Borrower; or

     (b) Specific Covenants. The Borrower fails to perform or observe any term, covenant
or agreement contained in any of Section 6.03(a), 6.11, 7.03, 7.07
or 7.08; or

     (c) Other Defaults. The Borrower fails to perform or observe any other covenant or
agreement (not specified in subsection (a) or (b) above) contained in any Loan Document on its part
to be performed or observed and such failure continues for 30 days after written notice of such
failure from the Administrative Agent or any Lender; or

     (d) Representations and Warranties. Any representation, warranty, certification or
statement of fact made or deemed made by or on behalf of the Borrower herein, in any other Loan
Document, or in any document delivered in connection herewith or therewith shall be incorrect or
misleading in any material respect when made or deemed made; or

     (e) Cross-Default. (i) The Borrower or any Significant Subsidiary (A) fails to make
any payment when due (whether by scheduled maturity, required prepayment, acceleration, demand, or
otherwise) in respect of any indebtedness or Guarantee (other than indebtedness hereunder and
indebtedness under Swap Contracts) having an aggregate principal amount (including undrawn
committed or available amounts and including amounts owing to all creditors under any combined or
syndicated credit arrangement) of more than the Threshold Amount or (B) fails to observe or perform
any other agreement or condition relating to any such indebtedness or Guarantee or contained in any
instrument or agreement evidencing, securing or relating thereto, or any other event occurs, the
effect of which default or other event is to cause, or to permit the holder or holders of such
indebtedness or the beneficiary or beneficiaries of such Guarantee (or a trustee or agent on behalf
of such holder or holders or beneficiary or beneficiaries) to cause, with the giving of notice if
required, such indebtedness to be demanded or to become due or to be repurchased, prepaid, defeased
or redeemed (automatically or otherwise) prior to its stated maturity, or such Guarantee to become
payable or cash collateral in respect thereof to be demanded prior to the stated maturity of the
obligations guaranteed; provided that if such default or other event is waived or
otherwise ceases to exist prior to such indebtedness becoming due prior to its stated maturity and
prior to the exercise by the Administrative Agent of its remedies under Section 8.02(a) or
(b), such default or other event shall no longer constitute an Event of Default hereunder; or
(ii) there occurs under any Swap Contract an Early Termination Date (as defined in such Swap
Contract) resulting from (A) any event of default under such Swap Contract as to which the Borrower
or any Significant Subsidiary is the Defaulting Party (as defined in such Swap Contract) or (B) any
Termination

 	 	 	 
	 	40	Credit Agreement

 

Event (as so defined) under such Swap Contract as to which the Borrower or any
Significant Subsidiary is an Affected Party (as so defined) and, in either event, the Swap
Termination Value owed by the Borrower or such Significant Subsidiary as a result thereof is
greater than the Threshold Amount; or

     (f) Insolvency Proceedings, Etc. The Borrower or any Significant Subsidiary
institutes or consents to the institution of any proceeding under any Debtor Relief Law, or makes
an assignment for the benefit of creditors; or applies for or consents to the appointment of any
receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer for it or
for all or any material part of its property; or any receiver, trustee, custodian, conservator,
liquidator, rehabilitator or similar officer is appointed without the application or consent of
such Person and the appointment continues undischarged or unstayed for 60 calendar days; or any
proceeding under any Debtor Relief Law relating to any such Person or to all or any material part
of its property is instituted without the consent of such Person and continues undismissed or
unstayed for 60 calendar days, or an order for relief is entered in any such proceeding; or

     (g) Inability to Pay Debts; Attachment. (i) The Borrower or any Significant
Subsidiary becomes unable or admits in writing its inability or fails generally to pay its debts as
they become due; or (ii) any writ or warrant of attachment or execution or similar process is
issued or levied against all or any material part of the property of any such Person and is
not released, vacated or fully bonded within 30 days after its issue or levy; or

     (h) Judgments. There is entered against the Borrower or any Significant Subsidiary
(i) a final judgment or order for the payment of money in an aggregate amount exceeding the
Threshold Amount (to the extent not covered by independent third-party insurance as to which the
insurer does not dispute coverage) or (ii) any one or more non-monetary final judgments that have,
or could reasonably be expected to have, individually or in the aggregate, a Material Adverse
Effect and, in either case, (A) enforcement proceedings are commenced by any creditor upon such
judgment or order or (B) there is a period of 30 consecutive days during which a stay of
enforcement of such judgment, by reason of a pending appeal or otherwise, is not in effect; or

     (i) ERISA. (i) An ERISA Event occurs with respect to a Pension Plan or Multiemployer
Plan which has resulted or could reasonably be expected to result in liability of the Borrower
under Title IV of ERISA to the Pension Plan, Multiemployer Plan or the PBGC in an aggregate amount
in excess of the Threshold Amount; or (ii) the Borrower or any ERISA Affiliate fails to pay when
due, after the expiration of any applicable grace period, any installment payment with respect to
its withdrawal liability under Section 4201 of ERISA under a Multiemployer Plan in an aggregate
amount in excess of the Threshold Amount; or

     (j) Invalidity of Loan Documents. Any Loan Document, at any time after its execution
and delivery and for any reason other than as expressly permitted hereunder or thereunder or
satisfaction in full of all the Obligations, ceases to be in full force and effect; or the Borrower
or any Subsidiary contests in any manner the validity or enforceability of any Loan Document; or
the Borrower denies that it has any or further liability or obligation under any Loan Document, or
purports to revoke, terminate or rescind any Loan Document; or

	 	 	 
	 	41	Credit Agreement

 

     (k) Adverse Governmental Action. Any Department or other Governmental Authority
revokes or fails to renew any insurance license, permit or franchise of any Insurance Subsidiary
that is a Significant Subsidiary, or imposes any restriction or condition on any insurance license,
permit or franchise of any Insurance Subsidiary that is a Significant Subsidiary, if such
revocation, non-renewal, condition or restriction is reasonably likely to have a Material Adverse
Effect; or

     (l) Change of Control. There occurs any Change of Control.

     8.02 Remedies Upon Event of Default. If any Event of Default occurs and is continuing, the
Administrative Agent shall, at the request of, or may, with the consent of, the Required Lenders,
take any or all of the following actions:

     (a) declare the commitment of each Lender to make Loans to be terminated, whereupon such
commitments shall be terminated;

     (b) declare the unpaid principal amount of all outstanding Loans, all interest accrued and
unpaid thereon, and all other amounts owing or payable hereunder or under any other Loan
Document to be immediately due and payable, without presentment, demand, protest or other
notice of any kind, all of which are hereby expressly waived by the Borrower; and

     (d) exercise on behalf of itself and the Lenders all rights and remedies available to it and
the Lenders under the Loan Documents;

provided, however, that upon the occurrence of an actual or deemed entry of an
order for relief with respect to the Borrower under the Bankruptcy Code of the United States, the
commitment of each Lender to make Loans shall automatically terminate, and the unpaid principal
amount of all outstanding Loans and all interest and other amounts as aforesaid shall automatically
become due and payable, in each case without further act of the Administrative Agent or any Lender.

     8.03 Application of Funds. After the exercise of remedies provided for in Section 8.02 (or
after the Loans have automatically become immediately due and payable), any amounts received on
account of the Obligations shall be applied by the Administrative Agent in the following order:

     First, to payment of that portion of the Obligations constituting fees, indemnities,
expenses and other amounts (including fees, charges and disbursements of counsel to the
Administrative Agent and amounts payable under Article III) payable to the Administrative
Agent in its capacity as such;

     Second, to payment of that portion of the Obligations constituting fees, indemnities
and other amounts (other than principal and interest) payable to the Lenders (including fees,
charges and disbursements of counsel to the respective Lenders and amounts payable under
Article III), ratably among them in proportion to the respective amounts described in this
clause Second payable to them;

	 	 	 
	 	42	Credit Agreement

 

     Third, to payment of that portion of the Obligations constituting accrued and unpaid
interest on the Loans and other Obligations, ratably among the Lenders in proportion to the
respective amounts described in this clause Third payable to them;

     Fourth, to payment of that portion of the Obligations constituting unpaid principal of
the Loans, ratably among the Lenders in proportion to the respective amounts described in this
clause Fourth held by them; and

     Last, the balance, if any, after all of the Obligations have been indefeasibly paid in
full, to the Borrower or as otherwise required by Law.

ARTICLE IX. ADMINISTRATIVE AGENT

     9.01 Appointment and Authority. Each of the Lenders hereby irrevocably appoints Bank of
America to act on its behalf as the Administrative Agent hereunder and under the other Loan
Documents 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 or thereof, together with such
actions and powers as are reasonably incidental thereto. The provisions of this Article are solely
for the benefit of the Administrative Agent and the Lenders, and the Borrower shall not have rights
as a third party beneficiary of any of such provisions.

     9.02 Rights as a Lender. 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 the term “Lender” or “Lenders” shall,
unless otherwise expressly indicated or unless the context otherwise requires, include the Person
serving as the Administrative Agent hereunder in its individual capacity. Such Person and its
Affiliates may accept deposits from, lend money to, act as the financial advisor or in any other
advisory capacity for and generally engage in any kind of business with the Borrower or any
Subsidiary or other Affiliate thereof as if such Person were not the Administrative Agent hereunder
and without any duty to account therefor to the Lenders.

     9.03 Exculpatory Provisions. The Administrative Agent shall not have any duties or
obligations except those expressly set forth herein and in the other Loan Documents. Without
limiting the generality of the foregoing, the Administrative Agent:

     (a) shall not be subject to any fiduciary or other implied duties, regardless of
whether a Default has occurred and is continuing;

     (b) shall not have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly contemplated hereby
or by the other Loan Documents that the Administrative Agent is required to exercise as
directed in writing by the Required Lenders (or such other number or percentage of the
Lenders as shall be expressly provided for herein or in the other Loan Documents);
provided that the Administrative Agent shall not be required to take any action
that, in its opinion or the opinion of its counsel, may expose the Administrative Agent to
liability or that is contrary to any Loan Document or applicable law; and

 	 	 	 
	 	43	Credit Agreement

 

     (c) shall not, except as expressly set forth herein and in the other Loan Documents,
have any duty to disclose, and shall not be liable for the failure to disclose, any
information relating to the Borrower or any of its Affiliates that is communicated to or
obtained by the Person serving as the 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 (i) with
the consent or at the request of the Required Lenders (or such other number or percentage of the
Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be
necessary, under the circumstances as provided in Sections 10.01 and 8.02) or (ii)
in the absence of its own gross negligence or willful misconduct. The Administrative Agent shall
be deemed not to have knowledge of any Default unless and until notice describing such Default is
given to the Administrative Agent by the Borrower or a Lender.

     The Administrative Agent shall not be responsible for or have any duty to ascertain or inquire
into (a) any statement, warranty or representation made in or in connection with this Agreement or
any other Loan Document, (b) the contents of any certificate, report or other document delivered
hereunder or thereunder or in connection herewith or therewith, (c) the performance or observance
of any of the covenants, agreements or other terms or conditions set forth herein or therein or the
occurrence of any Default, (d) the validity, enforceability, effectiveness or genuineness of this
Agreement, any other Loan Document or any other agreement, instrument or document or (e) the
satisfaction of any condition set forth in Article IV or elsewhere herein, other than to
confirm receipt of items expressly required to be delivered to the Administrative Agent.

     9.04 Reliance by 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 (including any electronic message, Internet or intranet website posting or other
distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated
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 have been made by the proper Person, and shall not incur any
liability for relying thereon. In determining compliance with any condition hereunder to the
making of a Loan that by its terms must be fulfilled to the satisfaction of a Lender, the
Administrative Agent may presume that such condition is satisfactory to such Lender unless the
Administrative Agent shall have received notice to the contrary from such Lender prior to the
making of such Loan. The Administrative Agent may consult with legal counsel (who may be counsel
for the Borrower), 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.

     9.05 Delegation of Duties. The Administrative Agent may perform any and all of its duties and
exercise its rights and powers hereunder or under any other Loan Document 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 of its duties and exercise its rights and powers by or through
their respective Related Parties. The exculpatory provisions of this Article

	 	 	 
	 	44	Credit Agreement

 

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.

     9.06 Resignation of Administrative Agent. The Administrative Agent may at any time give
notice of its resignation to the Lenders and the Borrower. Upon receipt of any such notice of
resignation, the Required Lenders shall have the right, in consultation with the Borrower, to
appoint a successor, which shall be a bank with an office in the United States, or an Affiliate of
any such bank with an office in the United States. If no such 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 may on behalf of the
Lenders, appoint a successor Administrative Agent meeting the qualifications set forth above;
provided that if the Administrative Agent shall notify the Borrower and the Lenders that no
qualifying Person has accepted such appointment, then such resignation shall nonetheless become
effective in accordance with such notice and (a) the retiring Administrative Agent shall be
discharged from its duties and obligations hereunder and under the other Loan Documents and (b) all
payments, communications and determinations 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 Administrative Agent as provided for above in this Section.
Upon the acceptance of a successor’s appointment as Administrative Agent hereunder, such successor
shall succeed to and become vested with all of the rights, powers, privileges and duties of the
retiring (or retired) Administrative Agent, and the retiring Administrative Agent shall be
discharged from all of its duties and obligations hereunder or under the other Loan Documents (if
not already discharged therefrom as provided above in this Section). The fees payable by the
Borrower to a successor Administrative Agent shall be the same as those payable to its predecessor
unless otherwise agreed between the Borrower and such successor. After the retiring Administrative
Agent’s resignation hereunder and under the other Loan Documents, the provisions of this Article
and Section 10.04 shall continue in effect for the benefit of such retiring Administrative
Agent, its sub-agents and their respective Related Parties in respect of any actions taken or
omitted to be taken by any of them while the retiring Administrative Agent was acting as
Administrative Agent.

     9.07 Non-Reliance on Administrative Agent and Other Lenders. Each Lender acknowledges that it
has, independently and without reliance upon the Administrative Agent or any other Lender or any of
their Related Parties 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 or any of their Related Parties 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 other Loan Document or any related agreement
or any document furnished hereunder or thereunder.

     9.08 No Other Duties, Etc. Anything herein to the contrary notwithstanding, neither the
Arranger nor the Documentation Agent listed on the cover page hereof shall have any powers, duties
or responsibilities under this Agreement or any of the other Loan Documents, except in its
capacity, as applicable, as the Administrative Agent or a Lender hereunder.

 	 	 	 
	 	45	Credit Agreement

 

     9.09 Administrative Agent May File Proofs of Claim. In case of the pendency of any
receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment,
composition or other judicial proceeding relative to the Borrower, the Administrative Agent
(irrespective of whether the principal of any Loan shall then be due and payable as herein
expressed or by declaration or otherwise and irrespective of
whether the Administrative Agent shall have made any demand on the Borrower) shall be entitled
and empowered, by intervention in such proceeding or otherwise:

     (a) to file and prove a claim for the whole amount of the principal and interest owing
and unpaid in respect of the Loans and all other Obligations that are owing and unpaid and
to file such other documents as may be necessary or advisable in order to have the claims of
the Lenders and the Administrative Agent (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Lenders and the Administrative
Agent and their respective agents and counsel and all other amounts due the Lenders and the
Administrative Agent under Sections 2.07 and 10.04) allowed in such judicial
proceeding; and

     (b) to collect and receive any monies or other property payable or deliverable on any
such claims and to distribute the same;

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official
in any such judicial proceeding is hereby authorized by each Lender to make such payments to the
Administrative Agent and, in the event that the Administrative Agent shall consent to the making of
such payments directly to the Lenders, to pay to the Administrative Agent any amount due for the
reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its
agents and counsel, and any other amounts due the Administrative Agent under Sections 2.07
and 10.04.

     Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or
consent to or accept or adopt on behalf of any Lender any plan of reorganization, arrangement,
adjustment or composition affecting the Obligations or the rights of any Lender or to authorize the
Administrative Agent to vote in respect of the claim of any Lender in any such proceeding.

ARTICLE X.

MISCELLANEOUS

     10.01 Amendments, Etc. No amendment or waiver of any provision of this Agreement or any other
Loan Document, and no consent to any departure by the Borrower therefrom, shall be effective unless
in writing signed by the Required Lenders and the Borrower and acknowledged by the Administrative
Agent, and each such waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given; provided, however, that no such amendment, waiver
or consent shall:

     (a) waive any condition set forth in Section 4.01(a) without the written consent of
each Lender;

	 	 	 
	 	46	Credit Agreement

 

     (b) extend or increase the Commitment of any Lender (or reinstate any Commitment terminated
pursuant to Section 8.02) without the written consent of such Lender;

     (c) postpone any date fixed by this Agreement or any other Loan Document for any payment of
principal, interest, fees or other amounts due to the Lenders (or any of them) hereunder or under
any other Loan Document without the written consent of each Lender directly affected thereby;

     (d) reduce the principal of, or the rate of interest specified herein on, any Loan, or any
fees or other amounts payable hereunder or under any other Loan Document without the written
consent of each Lender directly affected thereby; provided, however, that only the
consent of the Required Lenders shall be necessary to amend the definition of “Default Rate” or to
waive any obligation of the Borrower to pay interest at the Default Rate;

     (e) change Section 2.11 or Section 8.03 in a manner that would alter the pro
rata sharing of payments required thereby without the written consent of each Lender; or

     (f) change any provision of this Section or the definition of “Required Lenders” or any other
provision hereof specifying the number or percentage of Lenders required to amend, waive or
otherwise 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 amendment, waiver or consent shall, unless in
writing and signed by the Administrative Agent in addition to the Lenders required above, affect
the rights or duties of the Administrative Agent under this Agreement or any other Loan Document.
Notwithstanding anything to the contrary herein, no Defaulting Lender shall have any right to
approve or disapprove any amendment, waiver or consent hereunder, except that the Commitment of
such Lender may not be increased or extended without the consent of such Lender.

     10.02 Notices; Effectiveness; Electronic Communication.

     (a) Notices Generally. Except in the case of notices and other communications
expressly permitted to be given by telephone (and except as provided in subsection (b) below), 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 telecopier as
follows, and all notices and other communications expressly permitted hereunder to be given by
telephone shall be made to the applicable telephone number, as follows:

     (i) if to the Borrower or the Administrative Agent, to the address, telecopier number,
electronic mail address or telephone number specified for such Person on Schedule
10.02; and

     (ii) if to any other Lender, to the address, telecopier number, electronic mail address
or telephone number specified in its Administrative Questionnaire.

Notices sent by hand or overnight courier service, or mailed by certified or registered mail, shall
be deemed to have been given when received; notices sent by telecopier shall be deemed to have

 	 	 	 
	 	47	Credit Agreement

 

been given when sent (except that, if not given during normal business hours for the recipient, shall be
deemed to have been given at the opening of business on the next business day for the
recipient). Notices delivered through electronic communications to the extent provided in
subsection (b) below, shall be effective as provided in such subsection (b).

     (b) Electronic Communications. Notices and other communications to the Lenders
hereunder may be delivered or furnished by electronic communication (including e-mail and Internet
or intranet websites) pursuant to procedures approved by the Administrative Agent; provided
that the foregoing shall not apply to notices to any Lender pursuant to Article II if such
Lender has notified the Administrative Agent that it is incapable of receiving notices under such
Article by electronic communication. The Administrative Agent or the Borrower 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.

     Unless the Administrative Agent otherwise prescribes, (i) notices and other communications
sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement
from the intended recipient (such as by the “return receipt requested” function, as available,
return e-mail or other written acknowledgement); provided that if such notice or other
communication is not sent during the normal business hours of the recipient, such notice or
communication shall be deemed to have been sent at the opening of business on the next business day
for the recipient and (ii) notices or communications posted to an Internet or intranet website
shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as
described in the foregoing clause (i) of notification that such notice or communication is
available and identifying the website address therefor.

     (c) Change of Address, Etc. Each of the Borrower and the Administrative Agent may
change its address, telecopier or telephone number for notices and other communications hereunder
by notice to the other parties hereto. Each other Lender may change its address, telecopier or
telephone number for notices and other communications hereunder by notice to the Borrower and the
Administrative Agent. In addition, each Lender agrees to notify the Administrative Agent from time
to time to ensure that the Administrative Agent has on record (i) an effective address, contact
name, telephone number, telecopier number and electronic mail address to which notices and other
communications may be sent and (ii) accurate wire instructions for such Lender.

     (d) Reliance by Administrative Agent and Lenders. The Administrative Agent and the
Lenders shall be entitled to rely in good faith and act upon any notices (including telephonic Loan
Notices) purportedly given by or on behalf of the Borrower even if (i) such notices were not made
in a manner specified herein, were incomplete or were not preceded or followed by any other form of
notice specified herein or (ii) the terms thereof, as understood by the recipient, varied from any
confirmation thereof. The Borrower shall indemnify the Administrative Agent, each Lender and the
Related Parties of each of them from all losses, costs, expenses and liabilities resulting from the
good faith reliance by such Person on each notice purportedly given by or on behalf of the
Borrower. All telephonic notices to and other telephonic communications with the Administrative
Agent may be recorded by the Administrative Agent, and each of the parties hereto hereby consents
to such recording.

 	 	 	 
	 	48	Credit Agreement

 

     10.03 No Waiver; Cumulative Remedies. No failure by any party hereto to exercise, and no delay by any such Person in exercising, any
right, remedy, power or privilege hereunder shall operate as a waiver thereof; nor shall any single
or partial exercise of any right, remedy, power or privilege hereunder preclude any other or
further exercise thereof or the exercise of any other right, remedy, power or privilege. The
rights, remedies, powers and privileges herein provided are cumulative and not exclusive of any
rights, remedies, powers and privileges provided by law.

     10.04 Expenses; Indemnity; Damage Waiver.

     (a) Costs and Expenses. The Borrower shall 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, negotiation, execution,
and delivery of this Agreement and the other Loan Documents or any amendments, modifications or
waivers of the provisions hereof or thereof (whether or not the transactions contemplated hereby or
thereby shall be consummated) and (ii) all out-of-pocket expenses incurred by the Administrative
Agent or any Lender (including the fees, charges and disbursements of any counsel for the
Administrative Agent or any Lender), in connection with the enforcement or protection of its rights
(A) in connection with this Agreement and the other Loan Documents, including its rights under this
Section or (B) in connection with the Loans made hereunder, including all such out-of-pocket
expenses incurred during any workout, restructuring or negotiations in respect of such Loans.

     (b) Indemnification by the Borrower. The Borrower shall indemnify the Administrative
Agent (and any sub-agent thereof), each Lender and each Related Party of any of the foregoing
Persons (each such Person being called an “Indemnitee”) against, and 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), incurred by any Indemnitee or
asserted against any Indemnitee by any third party or by the Borrower arising out of, in connection
with, or as a result of (i) the execution or delivery of this Agreement, any other Loan Document or
any agreement or instrument contemplated hereby or thereby, the performance by the parties hereto
of their respective obligations hereunder or thereunder or the consummation of the transactions
contemplated hereby or thereby, or, in the case of the Administrative Agent (and any sub-agent
thereof) and its Related Parties only, the administrative of this Agreement and the other Loan
Documents, (ii) any Loan or the use or proposed use of the proceeds therefrom, (iii) any actual or
alleged presence or release of Hazardous Materials on or from any property owned or operated by the
Borrower or any of its Subsidiaries, or any Environmental Liability related in any way to the
Borrower or any of its Subsidiaries, except to the extent caused by such Indemnitee 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, whether brought by a third party or
by the Borrower, and regardless of whether any Indemnitee is a party thereto, in all cases, whether
or not caused by or arising, in whole or in part, out of the comparative, contributory or sole
negligence of the Indemnitee; provided that such indemnity shall not, as to any Indemnitee,
be available to the extent that such losses, claims, damages, liabilities or related expenses (x)
are determined by a court of competent jurisdiction by final and nonappealable judgment to have
resulted from the gross negligence or willful

 	 	 	 
	 	49	Credit Agreement

 

misconduct of such Indemnitee or (y) result from a
claim brought by the Borrower against an
Indemnitee for breach of such Indemnitee’s obligations hereunder or under any other Loan
Document, if the Borrower has obtained a final and nonappealable judgment by a court of competent
jurisdiction establishing such breach.

     (c) Reimbursement by Lenders. To the extent that the Borrower for any reason fails to
indefeasibly pay any amount required under subsection (a) or (b) of this Section to be paid by it
to the Administrative Agent (or any sub-agent thereof), or any Related Party of any of the
foregoing, each Lender severally agrees to pay to the Administrative Agent (or any such sub-agent),
or such Related Party, as the case may be, 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 (or any such sub-agent) in its capacity as such, or against any Related Party
of any of the foregoing acting for the Administrative Agent (or any such sub-agent) in connection
with such capacity. The obligations of the Lenders under this subsection (c) are subject to the
provisions of Section 2.10(d).

     (d) Waiver of Consequential Damages, Etc. To the fullest extent permitted by
applicable law, no party hereto shall assert, and each party hereto hereby waives, any claim 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, any other
Loan Document or any agreement or instrument contemplated hereby, the transactions contemplated
hereby or thereby, any Loan or the use of the proceeds thereof. No Indemnitee referred to in
subsection (b) above shall be liable for any damages arising from the use by unintended recipients
of any information or other materials distributed by it through telecommunications, electronic or
other information transmission systems in connection with this Agreement or the other Loan
Documents or the transactions contemplated hereby or thereby.

     (e) Payments. All amounts due under this Section shall be payable not later than ten
Business Days after demand therefor.

     (f) Survival. The agreements in this Section shall survive the resignation of the
Administrative Agent, the replacement of any Lender, the termination of the Aggregate Commitments
and the repayment, satisfaction or discharge of all the other Obligations.

     10.05 Payments Set Aside. To the extent that any payment by or on behalf of the Borrower is
made to the Administrative Agent or any Lender, or the Administrative Agent or any Lender exercises
its right of setoff, and such payment or the proceeds of such setoff or any part thereof is
subsequently invalidated, declared to be fraudulent or preferential, set aside or required
(including pursuant to any settlement entered into by the Administrative
Agent or such Lender in
its discretion) to be repaid to a trustee, receiver or any other party, in connection with any
proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of such recovery, the
obligation or part thereof originally intended to be satisfied shall be revived and continued in
full force and effect as if such payment had not been made or such setoff had not occurred and (b)
each Lender severally agrees to pay to the Administrative Agent upon demand its applicable
share (without duplication) of any amount so recovered from or repaid by the Administrative

 	 	 	 
	 	50	Credit Agreement

 

Agent, plus interest thereon from the date of such demand to the date such payment is made at a
rate per annum equal to the Federal Funds Rate from time to time in effect. The obligations of the
Lenders under clause (b) of the preceding sentence shall survive the payment in full of the
Obligations and the termination of this Agreement.

     10.06 Successors and Assigns.

     (a) Successors and Assigns 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 the Borrower may not assign or otherwise transfer any of its
rights or obligations hereunder without the prior written consent of the Administrative Agent and
each Lender and no Lender may assign or otherwise transfer any of its rights or obligations
hereunder, except (i) to an Eligible Assignee in accordance with the provisions of subsection (b)
of this Section, (ii) by way of participation in accordance with the provisions of subsection (d)
of this Section and (iii) by way of pledge or assignment of a security interest subject to the
restrictions of subsection (f) of this Section (and any other attempted assignment or transfer by
any party hereto shall be null and void). 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 subsection (d) 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. Any Lender may at any time, with (so long as no Event of
Default has occurred and is continuing) the prior written consent of the Borrower, which consent
shall not be unreasonably withheld or delayed, assign to one or more Eligible Assignees all or a
portion of its rights and obligations under this Agreement (including all or a portion of its
Commitment and the Loans at the time owing to it); provided that

     (i) except in the case of an assignment of the entire remaining amount of the assigning
Lender’s Commitment and the Loans at the time owing to it or in the case of an assignment to
a Lender or an Affiliate of a Lender or an Approved Fund with respect to a Lender, the
aggregate amount of the Commitment (which for this purpose includes Loans outstanding
thereunder) or, if the Commitment is not then in effect, the principal outstanding balance
of the Loans 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 or, if “Trade Date” is specified in the Assignment and Assumption, as
of the Trade Date, shall not be less than $5,000,000 unless each of the Administrative Agent
and, so long as no Event of Default has occurred and is continuing, the Borrower otherwise
consents (each such consent not to be unreasonably withheld or delayed); provided,
however, that concurrent assignments to members of an Assignee Group and concurrent
assignments from members of an Assignee Group to a single Eligible Assignee (or to an
Eligible Assignee and members of its Assignee Group) will be treated as a single assignment
for purposes of determining whether such minimum amount has been met;

 	 	 	 
	 	51	Credit Agreement

 

     (ii) 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 with respect to the
Loans or the Commitment assigned;

     (iii) any assignment of a Commitment must be approved by the Administrative Agent
unless the Person that is the proposed assignee is itself a Lender (whether or not the
proposed assignee would otherwise qualify as an Eligible Assignee); and

     (iv) the parties to each assignment shall execute and deliver to the Administrative
Agent an Assignment and Assumption, together with a processing and recordation fee in the
amount, if any, required as set forth in Schedule 10.06, and the Eligible Assignee,
if it shall not be a Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire.

Subject to acceptance and recording thereof by the Administrative Agent pursuant to subsection (c)
of this Section, from and after the effective date specified in each Assignment and Assumption, the
Eligible Assignee thereunder shall be a party to this Agreement 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 of Sections 3.01, 3.04, 3.05, and 10.04
with respect to facts and circumstances occurring prior to the effective date of such assignment.
Upon request, the Borrower (at its expense) shall execute and deliver a Note to the assignee
Lender. Any assignment or transfer by a Lender of rights or obligations under this Agreement that
does not comply with this subsection 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 subsection (d) of
this Section.

     (c) Register. The Administrative Agent, acting solely for this purpose as an agent of
the Borrower, shall maintain at the Administrative Agent’s Office a copy of each Assignment and
Assumption delivered to it and a register for the recordation of the names and addresses of the
Lenders, and the Commitments of, and principal amounts of the Loans owing to, each Lender pursuant
to the terms hereof from time to time (the “Register”). The entries in the Register shall
be conclusive, and the Borrower, the Administrative Agent and the Lenders may 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 the Borrower at any reasonable time and from time to time upon
reasonable prior notice. In addition, at any time that a request for a consent for a material or
substantive change to the Loan Documents is pending, any Lender may request and receive from the
Administrative Agent a copy of the Register.

     (d) Participations. Any Lender may at any time, without the consent of, or notice to,
the Borrower or the Administrative Agent, sell participations to any Person (other than a natural
person or the Borrower or any of the Borrower’s Affiliates or Subsidiaries) (each, a
“Participant”) in all or a portion of such Lender’s rights and/or obligations under this
Agreement

	 	 	 
	 	52	Credit Agreement

 

(including all or a portion of its Commitment and/or the Loans owing to it); provided
that (i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender
shall remain solely responsible to the other parties hereto for the performance of such obligations
and (iii) the Borrower, the Administrative Agent and the Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender’s rights and obligations under this
Agreement.

     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 to approve any
amendment, modification or waiver of any provision of this Agreement; provided that such
agreement or instrument may provide that such Lender will not, without the consent of the
Participant, agree to any amendment, waiver or other modification described in the first proviso to
Section 10.01 that affects such Participant. Subject to subsection (e) of this Section,
the Borrower agrees that each Participant shall be entitled to the benefits of Sections
3.01, 3.04 and 3.05 to the same extent as if it were a Lender and had acquired
its interest by assignment pursuant to subsection (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 2.11 as
though it were a Lender.

     (e) Limitations upon Participant Rights. A Participant shall not be entitled to
receive any greater payment under Section 3.01 or 3.04 than the applicable Lender
would have been entitled to receive with respect to the participation sold to such Participant,
unless the sale of the participation to such Participant is made with the Borrower’s prior written
consent. A Participant that would be a Foreign Lender if it were a Lender shall not be entitled to
the benefits of Section 3.01 unless the Borrower is notified of the participation sold to
such Participant and such Participant agrees, for the benefit of the Borrower, to comply with
Section 3.01(e) as though it were a Lender.

     (f) 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 (including under its Note, if any) to
secure obligations of such Lender, including any pledge or assignment to secure obligations to a
Federal Reserve Bank; provided that no such pledge or assignment shall release such Lender
from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as
a party hereto.

     (g) Electronic Execution of Assignments. The words “execution,” “signed,”
“signature,” and words of like import in any Assignment and Assumption shall be deemed to include
electronic signatures or the keeping of records in electronic form, each of which shall be of the
same legal effect, validity or enforceability as a manually executed signature or the use of a
paper-based recordkeeping system, as the case may be, to the extent and as provided for in any
applicable law, including the Federal Electronic Signatures in Global and National Commerce Act,
the New York State Electronic Signatures and Records Act, or any other similar state Laws based on
the Uniform Electronic Transactions Act.

     10.07 Treatment of Certain Information; Confidentiality. Each of the Administrative Agent and the Lenders agrees to maintain the confidentiality of the
Information (as defined below), except that Information may be disclosed (a) to its Affiliates and
to its and its

	 	 	 
	 	53	Credit Agreement

 

Affiliates’ respective partners, directors, officers, employees, agents, advisors
and representatives (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), (b) to the extent requested by any regulatory authority purporting to have
jurisdiction over it (including any self-regulatory authority, such as the National Association of
Insurance Commissioners), (c) to the extent required by applicable Laws or by any subpoena or
similar legal process, (d) to any other party hereto, (e) in connection with the exercise of any
remedies hereunder or under any other Loan Document or any action or proceeding relating to this
Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder, (f)
subject to an agreement containing provisions substantially the same as those of this Section, to
(i) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its
rights or obligations under this Agreement or (ii) any actual or prospective counterparty (or its
advisors) to any swap or derivative transaction relating to the Borrower and its obligations, (g)
with the consent of the Borrower or (h) to the extent such Information (x) becomes publicly
available other than as a result of a breach of this Section or (y) becomes available to the
Administrative Agent, any Lender or any of their respective Affiliates on a nonconfidential basis
from a source other than the Borrower. In the event that the Administrative Agent or any Lender is
required, pursuant to the provisions of clauses (b) or (c) of this paragraph, to disclose any of
the Information, such party shall, to the extent permitted by applicable law, provide the Borrower
with prompt written notice of such requirement so that the Borrower may seek a protective order or
other appropriate remedy

     For purposes of this Section, “Information” means all information received from the
Borrower or any Subsidiary relating to the Borrower or any Subsidiary or any of their respective
businesses, other than any such information that is available to the Administrative Agent or any
Lender on a nonconfidential basis prior to disclosure by the Borrower or any Subsidiary. 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.

     Each of the Administrative Agent and the Lenders acknowledges that (a) the Information may
include material non-public information concerning the Borrower or a Subsidiary, as the case may
be, (b) it has developed compliance procedures regarding the use of material non-public information
and (c) it will handle such material non-public information in accordance with applicable law,
including Federal and state securities Laws.

     10.08 Right of Setoff. If an Event of Default shall have occurred and be continuing, each
Lender and each of its Affiliates is hereby authorized at any time and from time to time, to the
fullest extent permitted by applicable law, to set off and apply any and all deposits (general or
special, time or demand, provisional or final, in whatever currency) at any time held and other
obligations (in whatever currency) at any time owing by such Lender or any such Affiliate to or for
the credit or the account of the Borrower against any and all of the obligations of the Borrower
now or hereafter
existing under this Agreement or any other Loan Document to such Lender, irrespective of
whether or not such Lender shall have made any demand under this Agreement or any other Loan
Document and although such obligations of the Borrower may be contingent or unmatured or are owed
to a branch or office of such Lender different from the

	 	 	 
	 	54	Credit Agreement

 

branch or office holding such deposit or
obligated on such indebtedness. The rights of each Lender and its Affiliates under this Section
are in addition to other rights and remedies (including other rights of setoff) that such Lender or
its Affiliates may have. Each Lender agrees to notify the Borrower and the Administrative Agent
promptly after any such setoff and application; provided that the failure to give such
notice shall not affect the validity of such setoff and application.

     10.09 Interest Rate Limitation. Notwithstanding anything to the contrary contained in any
Loan Document, the interest paid or agreed to be paid under the Loan Documents shall not exceed the
maximum rate of non-usurious interest permitted by applicable law (the “Maximum Rate”). If
the Administrative Agent or any Lender shall receive interest in an amount that exceeds the Maximum
Rate, the excess interest shall be applied to the principal of the Loans or, if it exceeds such
unpaid principal, refunded to the Borrower. In determining whether the interest contracted for,
charged, or received by the Administrative Agent or a Lender exceeds the Maximum Rate, such Person
may, to the extent permitted by applicable law, (a) characterize any payment that is not principal
as an expense, fee, or premium rather than interest, (b) exclude voluntary prepayments and the
effects thereof and (c) amortize, prorate, allocate, and spread in equal or unequal parts the total
amount of interest throughout the contemplated term of the Obligations hereunder.

     10.10 Counterparts; Integration; Effectiveness. This Agreement may be executed in
counterparts (and by different parties hereto in different counterparts), each of which shall
constitute an original, but all of which when taken together shall constitute a single contract.
This Agreement and the other Loan Documents constitute the entire contract 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 4.01, 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
that, when taken together, bear the signatures of each of the other parties hereto. Delivery of an
executed counterpart of a signature page of this Agreement by telecopy shall be effective as
delivery of a manually executed counterpart of this Agreement.

     10.11 Survival of Representations and Warranties. All representations and warranties made
hereunder and in any other Loan Document or other document delivered pursuant hereto or thereto or
in connection herewith or therewith shall survive the execution and delivery hereof and thereof.
Such representations and warranties have been or will be relied upon by the Administrative Agent
and each Lender, regardless of any investigation made by the Administrative Agent or any Lender or
on their behalf and notwithstanding that the Administrative Agent or any Lender may have had notice
or knowledge
of any Default at the time of any Borrowing, and shall continue in full force and effect as
long as any Loan or any other Obligation hereunder shall remain unpaid or unsatisfied.

     10.12 Severability. If any provision of this Agreement or the other Loan Documents is held to
be illegal, invalid or unenforceable, (a) the legality, validity and enforceability of the
remaining provisions of this Agreement and the other Loan Documents shall not be affected or
impaired thereby and (b) the parties shall endeavor in good faith negotiations to replace the
illegal, invalid or unenforceable provisions with valid provisions the economic effect of which

	 	 	 
	 	55	Credit Agreement

 

comes as close as possible to that of the illegal, invalid or unenforceable provisions. The
invalidity of a provision in a particular jurisdiction shall not invalidate or render unenforceable
such provision in any other jurisdiction.

     10.13 Replacement of Lenders. If any Lender requests compensation under Section 3.04,
or if the Borrower is required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 3.01, or if any Lender is a
Defaulting Lender, then the Borrower 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, and consents required by,
Section 10.06), all of its interests, rights and obligations under this Agreement and the
related Loan Documents to an assignee that shall assume such obligations (which assignee may be
another Lender, if a Lender accepts such assignment); provided that:

     (a) the Borrower shall have paid to the Administrative Agent the assignment fee specified in
Section 10.06(b);

     (b) such Lender shall have received payment of an amount equal to the outstanding principal of
its Loans, accrued interest thereon, accrued fees and all other amounts payable to it hereunder and
under the other Loan Documents (including any amounts under Section 3.05) from the assignee
(to the extent of such outstanding principal and accrued interest and fees) or the Borrower (in the
case of all other amounts);

     (c) in the case of any such assignment resulting from a claim for compensation under
Section 3.04 or payments required to be made pursuant to Section 3.01, such
assignment will result in a reduction in such compensation or payments thereafter; and

     (d) such assignment does not conflict with applicable Laws.

     A Lender shall not be required to make any such assignment or delegation if, prior thereto, as
a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to
require such assignment and delegation cease to apply.

     10.14 Governing Law; Jurisdiction; Etc.

     (a) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE COMMONWEALTH OF PENNSYLVANIA.

     (b) SUBMISSION TO JURISDICTION. THE BORROWER IRREVOCABLY AND UNCONDITIONALLY SUBMITS,
FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE COMMONWEALTH OF
PENNSYLVANIA SITTING IN PHILADELPHIA COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE EASTERN
DISTRICT OF PENNSYLVANIA, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR FOR RECOGNITION OR
ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES

 	 	 	 
	 	56	Credit Agreement

 

THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH
PENNSYLVANIA STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE 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 OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT
ANY RIGHT THAT THE ADMINISTRATIVE AGENT OR ANY LENDER MAY OTHERWISE HAVE TO BRING ANY ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST THE BORROWER OR ITS
PROPERTIES IN THE COURTS OF ANY JURISDICTION.

     (c) WAIVER OF VENUE. THE BORROWER IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE
LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT 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 APPLICABLE LAW, THE DEFENSE OF
AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.

     (d) SERVICE OF PROCESS. EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS
IN THE MANNER PROVIDED FOR NOTICES IN SECTION 10.02. NOTHING IN THIS AGREEMENT WILL AFFECT
THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.

     10.15 Waiver of Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY 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 ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER
BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT
SUCH OTHER PERSON 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 AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.

     10.16 USA PATRIOT Act Notice. Each Lender that is subject to the Act (as hereinafter defined)
and the Administrative Agent (for itself and not on behalf of any Lender) hereby notifies the
Borrower that pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56
(signed into law October 26, 2001)) (the “Act”), it is required to obtain, verify

	 	 	 
	 	57	Credit Agreement

 

and record information that identifies the Borrower, which information includes the name and address of
the Borrower and other information that will allow such Lender or the Administrative Agent, as
applicable, to identify the Borrower in accordance with the Act.

     10.17 No Advisory or Fiduciary Responsibility. In connection with all aspects of each
transaction contemplated hereby, the Borrower acknowledges and agrees that: (i) the credit facility
provided for hereunder and any related arranging or other services in connection therewith
(including in connection with any amendment, waiver or other modification hereof or of any other
Loan Document) are an arm’s-length commercial transaction between the Borrower, on the one hand,
and the Administrative Agent, the Arranger and the Lenders, on the other hand, and the Borrower is
capable of evaluating and understanding and understands and accepts the terms, risks and conditions
of the transactions contemplated hereby and by the other Loan Documents (including any amendment,
waiver or other modification hereof or thereof); (ii) in connection with the process leading to
such transaction, each of the Administrative Agent, the Arranger and the Lenders is and has been
acting solely as a principal and is not the financial advisor, agent or fiduciary for the Borrower
or any of its Affiliates, stockholders, creditors or employees or any other Person; (iii) neither
the Administrative Agent, the Arranger nor any Lender has assumed or will assume an advisory,
agency or fiduciary responsibility in favor of the Borrower with respect to any of the transactions
contemplated hereby or the process leading thereto, including with respect to any amendment, waiver
or other modification hereof or of any other Loan Document (irrespective of whether the
Administrative Agent, the Arranger or any Lender has advised or is currently advising the Borrower
or any of its Affiliates on other matters) and neither the Administrative Agent, the Arranger nor
any Lender has any obligation to the Borrower or any of its Affiliates with respect to the
transactions contemplated hereby except those obligations expressly set forth herein and in the
other Loan Documents; (iv) the Administrative Agent, the Arranger, the Lenders and their respective
Affiliates may be engaged in a broad range of transactions that involve interests that differ from
those of the Borrower and its Affiliates, and neither the Administrative Agent, the
Arranger nor any Lender has any obligation to disclose any of such interests by virtue of any
advisory, agency or fiduciary relationship; and (v) the Administrative Agent, the Arranger and the
Lenders have not provided and will not provide any legal, accounting, regulatory or tax advice with
respect to any of the transactions contemplated hereby (including any amendment, waiver or other
modification hereof or of any other Loan Document) and the Borrower has consulted its own legal,
accounting, regulatory and tax advisors to the extent it has deemed appropriate. The Borrower
hereby waives and releases, to the fullest extent permitted by law, any claims that it may have
against the Administrative Agent, the Arranger or any Lender with respect to any breach or alleged
breach of agency or fiduciary duty.

 	 	 	 
	 	58	Credit Agreement

 

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of
the date first above written.

	 	 	 	 	 
	PHILADELPHIA CONSOLIDATED HOLDING CORP.
	 
	 	 	 	 
	By:

	 	James J. Maguire, Jr.	 	 
	 

	 	 

James J. Maguire, Jr.
	 	 
	 

	 	President and Chief Executive Officer	 	 
	 
	 	 	 	 
	BANK OF AMERICA, N.A., as Administrative Agent
	 
	 	 	 	 
	By:

	 	Aamir Saleem	 	 
	 

	 	 

Aamir Saleem
	 	 
	 

	 	Vice President	 	 
	 
	 	 	 	 
	BANK OF AMERICA, N.A., as a Lender
	 
	 	 	 	 
	By:

	 	Jeffrey M. Shaver	 	 
	 

	 	 

Jeffrey M. Shaver
	 	 
	 

	 	Vice President	 	 
	 
	 	 	 	 
	WACHOVIA BANK, NATIONAL ASSOCIATION, as a Lender
	 
	 	 	 	 
	By:

	 	Grainne M. Pergolini	 	 
	 

	 	 

Grainne M. Pergolini
	 	 
	 

	 	Vice President	 	 

Signature Page to Credit Agreement

 

 

SCHEDULE 2.01

COMMITMENTS

AND APPLICABLE PERCENTAGES

	 	 	 	 	 	 	 	 	 
	                    Lender	 	Commitment	 	 	Applicable Percentage	 
	 
	Bank of America, N.A.
	 	$	25,000,000	 	 	 	50.000000000	%
	Wachovia Bank, National
Association
	 	 	25,000,000	 	 	 	50.000000000	%
	 
	 	 	 	 	 	 	 	 
	Total
	 	$	50,000,000	 	 	 	100.000000000	%

1

 

SCHEDULE 5.06

LITIGATION

On June 15, 2005, a subpoena was received from the Securities and Exchange Commission requesting
documents and other information relating to non-traditional insurance arrangements between the
Borrower’s subsidiaries, Philadelphia Indemnity Insurance Company and Philadelphia Insurance
Company, and Gen Re Corporation. The reference to the subpoena on this Schedule is done as a
disclosure matter, and by inclusion on this Schedule there should not be deemed to be any
implication (a) that the Borrower necessarily believes that the receipt of the subpoena or any
proceeding arising therefrom is reasonably expected to have a Material Adverse Effect or (b) that
this disclosure is an exception to the representation and warranty set forth in Section 5.06 of
this Agreement.

1

 

SCHEDULE 5.13

SUBSIDIARIES

	 	 	 
	 	 	Jurisdiction of
	                    Name of Subsidiary	 	Organization
	 
	Maguire Insurance Agency, Inc.

	 	Pennsylvania
	PCHC Investment Corp.

	 	Delaware
	Philadelphia Indemnity Insurance Company

	 	Pennsylvania
	Philadelphia Insurance Company

	 	Pennsylvania
	Liberty American Insurance Group, Inc.

	 	Delaware
	Liberty American Select Insurance Company

	 	Florida
	Liberty American Insurance Company

	 	Florida
	Liberty American Insurance Services, Inc.

	 	Florida
	Liberty American Premium Finance Company

	 	Florida

1

 

SCHEDULE 7.02

EXISTING CONSOLIDATED FUNDED INDEBTEDNESS

NONE

1

 

SCHEDULE 10.02

ADMINISTRATIVE AGENT’S OFFICE;

CERTAIN ADDRESSES FOR NOTICES

BORROWER:

Philadelphia Consolidated Holding Corp.

One Bala Plaza, Suite 100

Bala Cynwyd, Pennsylvania 19004

Attention: Craig P. Keller

Telephone: 610-617-7684

Telecopier: 610-617-5875

Electronic Mail: ckeller@phlyins.com

Website Address:          www.phly.com

ADMINISTRATIVE AGENT:

Administrative Agent’s Office

(for payments and Requests for Borrowings):

Bank of America, N.A.

Building B

2001 Clayton Rd.

CA4-702-02-25

Concord, CA 94520-2405

Attention:           Geri Hair

Telephone:          925-675-7338

Telecopier:          888-969-9235

Electronic Mail: geralyn.d.hair@bankofamerica.com

Account No.:     3750836479

Ref:                    Philadelphia Consolidated Holding Corp.

ABA#:               026-009-593

Other Notices as Administrative Agent:

Bank of America, N.A.

Agency Management

CA5-701-05-19

1455 Market Street, 5th Floor

San Francisco, CA 94103-1399

Attention:       Aamir Saleem

Telephone:     415- 436-2769

Telecopier:     415- 503-5089

Electronic Mail:          aamir.saleem@bankofamerica.com

1

 

SCHEDULE 10.06

PROCESSING AND RECORDATION FEES

Unless waived by the Administrative Agent in its sole discretion, the Administrative Agent will
charge a processing and recordation fee (an “Assignment Fee”) in the amount of $2,500 for
each assignment; provided, however, that in the event of two or more concurrent
assignments to members of the same Assignee Group (which may be effected by a suballocation of an
assigned amount among members of such Assignee Group) or two or more concurrent assignments by
members of the same Assignee Group to a single Eligible Assignee (or to an Eligible Assignee and
members of its Assignee Group), the Assignment Fee will be $2,500 plus the amount set forth below:

	 	 	 	 	 
	Transaction	 	Assignment Fee
	First four concurrent assignments or suballocations to
members of an Assignee Group (or from members of an
Assignee Group, as applicable)
	 	 	-0-	 
	 
	Each additional concurrent assignment or suballocation to a
member of such Assignee Group (or from a member of such
Assignee Group, as applicable)
	 	$	500	 

1

 

EXHIBIT A

FORM OF LOAN NOTICE

Date:                                         ,                     

To:          Bank of America, N.A., as Administrative Agent

Ladies and Gentlemen:

Reference is made to that certain Credit Agreement dated as of June 30, 2006 (as amended, restated,
extended, supplemented or otherwise modified in writing from time to time, the “Agreement;”
the terms defined therein being used herein as therein defined), among Philadelphia Consolidated
Holding Corp., a Pennsylvania corporation (the “Borrower”), the Lenders from time to time
party thereto, and Bank of America, N.A., as Administrative Agent.

     The undersigned hereby requests (select one):

	 	 	 	 	 	 	 	 	 
	 

	 	o
	 	A Borrowing of Loans
	 	o
	 	A conversion or continuation of Loans

	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	1.	 	 	On
	 	 	 	(a Business Day).
	 

	 	 	 	 	 	 	 	 	 	 

	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	2.	 	 	In the amount of $	 	 	.	 
	 

	 	 	 	 	 	 	 	 

	 	 

	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	3.	 	 	Comprised of 	 	 	.	 
	 

	 	 	 	 	 	 	 	 

[Type of Loan requested]
	 	 

	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	4.	 	 	For Eurodollar Rate Loans: with an Interest Period of
	 	 	 	months.
	 

	 	 	 	 	 	 	 	 	 	 

     The Borrowing, if any, requested herein complies with the proviso to the first sentence of
Section 2.01 of the Agreement.

	 	 	 	 	 
	 	 	PHILADELPHIA CONSOLIDATED HOLDING CORP.
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	Name:	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	Title:	 	 
	 

	 	 	 	 

A-1 — 1

Form of Loan Notice

 

 

EXHIBIT B

FORM OF NOTE

                                        

     FOR VALUE RECEIVED, the undersigned (the “Borrower”) hereby promises to pay to
                                         or registered assigns (the “Lender”), in accordance with the
provisions of the Agreement (as hereinafter defined), the principal amount of each Loan from time
to time made by the Lender to the Borrower under that certain Credit Agreement, dated as of June
30, 2006 (as amended, restated, extended, supplemented or otherwise modified in writing from time
to time, the “Agreement;” the terms defined therein being used herein as therein defined),
among the Borrower, the Lenders from time to time party thereto, and Bank of America, N.A., as
Administrative Agent.

     The Borrower promises to pay interest on the unpaid principal amount of each Loan from the
date of such Loan until such principal amount is paid in full, at such interest rates and at such
times as provided in the Agreement. All payments of principal and interest shall be made to the
Administrative Agent for the account of the Lender in Dollars in immediately available funds at the
Administrative Agent’s Office. If any amount is not paid in full when due hereunder, such unpaid
amount shall bear interest, to be paid upon demand, from the due date thereof until the date of
actual payment (and before as well as after judgment) computed at the per annum rate set forth in
the Agreement.

     This Note is one of the Notes referred to in the Agreement, is entitled to the benefits
thereof and may be prepaid in whole or in part subject to the terms and conditions provided
therein. Upon the occurrence and continuation of one or more of the Events of Default specified in
the Agreement, all amounts then remaining unpaid on this Note shall become, or may be declared to
be, immediately due and payable all as provided in the Agreement. Loans made by the Lender shall
be evidenced by one or more loan accounts or records maintained by the Lender in the ordinary
course of business. The Lender may also attach schedules to this Note and endorse thereon the date,
amount and maturity of its Loans and payments with respect thereto.

     The Borrower, for itself, its successors and assigns, hereby waives diligence, presentment,
protest and demand and notice of protest, demand, dishonor and non-payment of this Note.

B — 1

Form of Note

 

 

     THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE COMMONWEALTH
OF PENNSYLVANIA.

	 	 	 	 	 
	 	 	PHILADELPHIA CONSOLIDATED HOLDING CORP.
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	Name:	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	Title:	 	 
	 

	 	 	 	 

B — 2

Form of Note

 

 

LOANS AND PAYMENTS WITH RESPECT THERETO

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Amount of	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Principal or	 	 	Outstanding	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	End of	 	 	Interest	 	 	Principal	 	 	 	 
	 	 	Type of	 	 	Amount of	 	 	Interest	 	 	Paid This	 	 	Balance	 	 	Notation	 
	Date	 	Loan Made	 	 	Loan Made	 	 	Period	 	 	Date	 	 	This Date	 	 	Made By	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

B
— 3

Form of Note

 

 

EXHIBIT C

FORM OF COMPLIANCE CERTIFICATE

Financial
Statement Date:                     ,

To:   Bank of America, N.A., as Administrative Agent

Ladies and Gentlemen:

     Reference is made to that certain Credit Agreement, dated as of June 30, 2006 (as amended,
restated, extended, supplemented or otherwise modified in writing from time to time, the
“Agreement;” the terms defined therein being used herein as therein defined), among
Philadelphia Consolidated Holding Corp., a Pennsylvania corporation (the “Borrower”), the
Lenders from time to time party thereto, and Bank of America, N.A., as Administrative Agent.

     The undersigned hereby certifies as of the date hereof that he/she is a Responsible Officer of
the Borrower, and that, as such, he/she is authorized to execute and deliver this Certificate to
the Administrative Agent on the behalf of the Borrower, and that:

[Use following paragraph 1 for fiscal year-end financial statements]

     1. Attached hereto as Schedule 1 are the year-end audited financial statements
required by Section 6.01(a) of the Agreement for the fiscal year of the Borrower ended as
of the above date, together with the report and opinion of an independent certified public
accountant required by such section.

[Use following paragraph 1 for fiscal quarter-end financial statements]

     1. Attached hereto as Schedule 1 are the unaudited financial statements required by
Section 6.01(b) of the Agreement for the fiscal quarter of the Borrower ended as of the
above date. Such financial statements fairly present the financial condition, results of
operations and cash flows of the Borrower and its Subsidiaries in accordance with GAAP as at such
date and for such period, subject only to normal year-end audit adjustments and the absence of
footnotes.

     2. The undersigned has reviewed and is familiar with the terms of the Agreement and has made,
or has caused to be made under his/her supervision, a detailed review of the transactions and
condition (financial or otherwise) of the Borrower during the accounting period covered by the
attached financial statements.

     3. A review of the activities of the Borrower during such fiscal period has been made under
the supervision of the undersigned with a view to determining whether during such fiscal period the
Borrower performed and observed all its Obligations under the Loan Documents, and

[select one:]

     [to the best knowledge of the undersigned during such fiscal period, the Borrower
performed and observed each covenant and condition of the Loan Documents applicable to it, and no Default has
occurred and is continuing.]

C — 1

Form of Compliance Certificate

 

—or—

     [the following covenants or conditions have not been performed or observed and the following
is a list of each such Default and its nature and status:]

     4. The representations and warranties of the Borrower contained in Article V of the
Agreement, and any representations and warranties of the Borrower that are contained in any
document furnished at any time under or in connection with the Loan Documents, are true and correct
in all material respects on and as of the date hereof, except (i) to the extent that such
representations and warranties specifically refer to an earlier date, in which case they are true
and correct as of such earlier date, (ii) that for purposes of this Compliance Certificate, the
representations and warranties contained in subsections (a) and (b) of Section 5.05 of the
Agreement shall be deemed to refer to the most recent statements furnished pursuant to clauses (a)
and (b), respectively, of Section 6.01 of the Agreement, including the statements in
connection with which this Compliance Certificate is delivered, and (iii) for any changes in such
representations and warranties that have resulted from acts or omissions of the Borrower that do
not constitute a breach of the Agreement.

     5. The financial covenant analyses and information set forth on Schedule 2 attached
hereto are true and accurate on and as of the date of this Certificate.

     IN WITNESS WHEREOF, the undersigned has executed this Certificate as
of                     ,                    .

	 	 	 	 	 	 	 
	 	 	PHILADELPHIA CONSOLIDATED HOLDING CORP.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	Name:
	 	 

	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 

C — 2

Form of Compliance Certificate

 

EXHIBIT D

ASSIGNMENT AND ACCEPTANCE

     This Assignment and Acceptance (this “Assignment and Acceptance”) is dated as of the
Effective Date set forth below and is entered into by and between [the] [each] Assignor identified
in Item 1 below ([the] [each, an] “Assignor”) and [the] [each] Assignee identified in Item
2 below ([the] [each, an] “Assignee”). [It is understood and agreed that the rights and
obligations of [the Assignors] [the Assignees] hereunder are several and not joint.] Capitalized
terms used but not defined herein shall have the meanings given to them in the Credit Agreement
identified below (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 Acceptance as if set forth herein in full.

     For an agreed consideration, [the] [each] Assignor hereby irrevocably sells and assigns to
[the Assignee] [the respective Assignees], and [the] [each] Assignee hereby irrevocably purchases
and assumes from [the Assignor] [the respective Assignors], subject to and in accordance with the
Standard Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by the
Agent as contemplated below (i) all of [the Assignor’s] [the respective Assignors’] rights and
obligations in [its capacity as a Lender] [their respective capacities as Lenders] 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] [the respective Assignors] under the respective facilities
identified below and (ii) to the extent permitted to be assigned under applicable law, all claims,
suits, causes of action and any other right of [the Assignor (in its capacity as a Lender)] [the
respective Assignors (in their respective capacities as Lenders)] 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, but not limited to, 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 by [the] [any] Assignor to [the] [any] Assignee pursuant to clauses
(i) and (ii) above being referred to herein collectively as, [the] [an] “Assigned
Interest”). Each such sale and assignment is without recourse to [the] [any] Assignor and,
except as expressly provided in this Assignment and Acceptance, without representation or warranty
by [the] [any] Assignor.

	 	 	 	 	 
	1.

	 	Assignor[s]:
	 	                                                            
	 
	 	 	 	 
	2.

	 	Assignee[s]:
	 	                                                             [for each Assignee, indicate
[Affiliate] [Approved Fund] of [identify Lender]]
	 
	 	 	 	 
	3.

	 	Borrower:
	 	Philadelphia Consolidated Holding Corp.
	 
	 	 	 	 
	4.

	 	Agent:
	 	Bank of America, N.A., as the administrative agent under the Credit Agreement

D — 1

Form of Assignment and Acceptance

 

	 	 	 
	5.

	 	Credit Agreement: Credit Agreement, dated as of June 30, 2006, among Philadelphia Consolidated
Holding Corp., the Lenders from time to time party thereto, and Bank of America,
N.A., as Administrative Agent
	 
	 	 
	6.

	 	Assigned Interest:

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	Aggregate	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	Amount of	 	 	 	 	 	 	Percentage	 
	 	 	 	 	 	 	 	 	 	 	Commitment/	 	 	Amount of	 	 	Assigned of	 
	 	 	 	 	 	 	Facility	 	 	Loans for all	 	 	Commitment/	 	 	Commitment/	 
	Assignor[s]	 	Assignee[s]	 	 	Assigned1	 	 	Lenders	 	 	Loans Assigned	 	 	Loans2	 
	 
	 	 	 	 	 	 	 	 	 	$	 	 	 	$	 	 	 	 	 	%
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	$	 	 	 	$	 	 	 	 	 	%
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	$	 	 	 	$	 	 	 	 	 	%
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

     [7.      Trade Date:                          ]3

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

- Signature Page to Follow-

 

			
	1	 	Fill in the appropriate terminology for the
types of facilities under the Credit Agreement that are being assigned under
this Assignment (e.g. “Revolving Credit Commitment”, etc.).
	 
	2	 	Set forth, to at least 9 decimals, as a
percentage of the Commitment of all Lenders thereunder.
	 
	3	 	To be completed if the Assignor and the
Assignee intend that the minimum assignment amount is to be determined as of
the Trade Date.

D — 2

Form of Assignment and Acceptance

 

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

	 	 	 	 	 	 	 
	 	 	ASSIGNOR

[NAME OF ASSIGNOR]	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Title:
	 	 
	 
	 	 	 	 	 	 
	 	 	ASSIGNEE

[NAME OF ASSIGNEE]	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 
	[Consented to and]4 Accepted:
	 	 	 	 	 	 

	 	 	 	 	 
	BANK OF AMERICA, N.A., as Agent	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 	 	 
	 

	 	Title:	 	 
	 
	 	 	 	 
	[Consented to:]5	 	 
	 
	 	 	 	 
	PHILADELPHIA CONSOLIDATED HOLDING CORP.	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 	 	 
	 

	 	Title:	 	 

 

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

D — 3

Form of Assignment and Acceptance

 

ANNEX 1 TO ASSIGNMENT AND ACCEPTANCE

STANDARD TERMS AND CONDITIONS FOR

ASSIGNMENT AND ACCEPTANCE

          1. Representations and Warranties.

          1.1. Assignor. [The] [Each] Assignor (a) represents and warrants that (i) it is the
legal and beneficial owner of [the] [the relevant] Assigned Interest, (ii) [the] [such] 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
Acceptance 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 Loan Document, (ii) the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any collateral
thereunder, (iii) the financial condition of the Borrower, any of its Subsidiaries or Affiliates or
any other Person obligated in respect of any Loan Document or (iv) the performance or observance by
the Borrower, any of its Subsidiaries or Affiliates or any other Person of any of their respective
obligations under any Loan Document.

          1.2. Assignee. [The] [Each] 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
Acceptance and to consummate the transactions contemplated hereby and to become a Lender under the
Credit Agreement, (ii) it meets all the requirements to be an assignee under Subsections
9.7(b)(iii), (v) and (vi) of the Credit Agreement (subject to such consents, if
any, as may be required under Subsection 9.7(b)(iii) of the Credit Agreement), (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] [the relevant] Assigned Interest, shall have the
obligations of a Lender thereunder, (iv) it is sophisticated with respect to decisions to acquire
assets of the type represented by [the] [such] Assigned Interest and either it, or the Person
exercising discretion in making its decision to acquire [the] [such] Assigned Interest, is
experienced in acquiring assets of such type, (v) it has received a copy of the Credit Agreement,
and has received or has been accorded the opportunity to receive copies of the most recent
financial statements delivered pursuant to Subsection 5.1 thereof, as applicable, and such other
documents and information as it deems appropriate to make its own credit analysis and decision to
enter into this Assignment and Acceptance and to purchase [the] [such] Assigned Interest, (vi) it
has independently and without reliance upon the 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 Assignment and Assumption and to purchase [the] [such] Assigned Interest, and
(vii) if it is a Lender that is not organized under the laws of the United States of America or a
State thereof, attached hereto is any documentation required to be delivered by it pursuant to the
terms of the Credit Agreement, duly completed and executed by [the] [such] Assignee; and (b) agrees
that (i) it will, independently and without reliance upon the Agent, [the] [any] 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

D — 4

Form of Assignment and Acceptance

 

action under the Loan Documents, and (ii) it will perform in accordance with their terms all
of the obligations which by the terms of the Loan Documents are required to be performed by it as a
Lender.

          2. Payments. From and after the Effective Date, the Agent shall make all payments in
respect of [the] [each] Assigned Interest (including payments of principal, interest, fees and
other amounts) to [the] [the relevant] Assignor for amounts which have accrued to but excluding the
Effective Date and to [the] [the relevant] Assignee for amounts which have accrued from and after
the Effective Date.

3. General Provisions. This Assignment and Acceptance shall be binding upon, and inure to
the benefit of, the parties hereto and their respective successors and assigns. This Assignment
and Acceptance 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
Acceptance by telecopy shall be effective as delivery of a manually executed counterpart of this
Assignment and Acceptance. This Assignment and Acceptance shall be governed by, and construed in
accordance with, the law of the Commonwealth of Pennsylvania.

D — 5

Form of Assignment and Acceptance

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