Document:

exv10w2

Exhibit 10.2

	 	 	 
	Committed Line of Credit Note

	 	
	(Multi-Rate Options)
	 	 
	 
	 	 
	$50,000,000.00

	 	January 30, 2008

FOR VALUE RECEIVED, ERIE INDEMNITY COMPANY (the “Borrower”), with an address at 100 Erie Insurance
Place, Erie, Pennsylvania 16530, promises to pay to the order of PNC BANK, NATIONAL ASSOCIATION
(the “Bank”), in lawful money of the United States of America in immediately available funds at its
offices located at 901 State Street, P.O. Box 8480, Erie, Pennsylvania 16553, or at such other
location as the Bank may designate from time to time, the principal sum of FIFTY MILLION DOLLARS
($50,000,000.00) (the “Facility”) or such lesser amount as may be advanced to or for the benefit of
the Borrower hereunder, together with interest accruing on the outstanding principal balance from
the date hereof, all as provided below.

1. Advances. The Borrower may request advances, repay and request additional advances
hereunder until the Expiration Date, subject to the terms and conditions of this Note and the Loan
Documents (as hereinafter defined). The “Expiration Date” shall mean December 31, 2008, or such
later date as may be designated by the Bank by written notice from the Bank to the Borrower. The
Borrower acknowledges and agrees that in no event will the Bank be under any obligation to extend
or renew the Facility or this Note beyond the Expiration Date. The Borrower may request advances
hereunder upon giving oral or written notice to the Bank by 11:00 a.m. (Erie, Pennsylvania time)
(a) on the day of the proposed advance, in the case of advances to bear interest under the Base
Rate Option (as hereinafter defined) or the Fed Funds Rate Option (as hereinafter defined) and (b)
three (3) Business Days prior to the proposed advance, in the case of advances to bear interest
under the LIBOR Option (as hereinafter defined), followed promptly thereafter by the Borrower’s
written confirmation to the Bank of any oral notice. The aggregate unpaid principal amount of
advances under this Note shall not exceed the face amount of this Note.

2. Rate of Interest. Each advance outstanding under this Note will bear interest at a rate
or rates per annum as may be selected by the Borrower from the interest rate options set forth
below (each, an “Option”):

     (i) Base Rate Option. A rate of interest per annum which is at all times equal to the
Prime Rate (“Base Rate”). For purposes hereof, the term “Prime Rate” shall mean the rate publicly
announced by the Bank from time to time as its prime rate. The Prime Rate is determined from time
to time by the Bank as a means of pricing some loans to its borrowers. The Prime Rate is not tied
to any external rate of interest or index, and does not necessarily reflect the lowest rate of
interest actually charged by the Bank to any particular class or category of customers. If and
when the Prime Rate changes, the rate of interest with respect to any advance to which the Base
Rate Option applies will change automatically without notice to the Borrower, effective on the date
of any such change. There are no required minimum interest periods for advances bearing interest
under the Base Rate Option.

     (ii) Fed Funds Rate Option. A rate of interest per annum which is at all times equal
to (A) the Federal Funds Rate plus (B) fifty (50) basis points (0.50%) (“Fed Funds Rate”).
For purposes hereof, “Federal Funds Rate” for any day shall mean the rate per annum (based on a
year of 360 days and actual days elapsed) determined by the Bank in accordance with its usual
procedures (which determination shall be conclusive absent manifest error) to be the Open Rate for
federal funds transactions as of the opening of business for federal funds transactions among
members of the Federal Reserve System arranged by federal funds brokers on such day, as quoted by
Garvin Guybutler (or any successor) or any other broker selected by the Bank, as set forth on the
applicable Telerate display page; provided however, that if such day is not a Business Day, the
Federal Funds Rate for such day shall be the Open Rate on the immediately preceding Business Day or
if no such rate shall be quoted by a federal funds broker at such time, such other rate as
determined by the Bank in accordance with its usual procedures (which determination shall be
conclusive absent manifest error). If and when the Federal Funds Rate changes, the rate of interest
with respect to any advance to which the Federal Funds Rate applies will change automatically
without notice to the Borrower, effective on the date of any such change.

 

 

     (iii) LIBOR Option. A rate per annum equal to (A) LIBOR plus (B) fifty (50)
basis points (0.50%), for the applicable LIBOR Interest Period.

For purposes hereof, the following terms shall have the following meanings:

“Business Day” shall mean any day other than a Saturday or Sunday or a legal holiday on
which commercial banks are authorized or required by law to be closed for business in Erie,
Pennsylvania.

“LIBOR” shall mean, with respect to any advance to which the LIBOR Option applies for the
applicable LIBOR Interest Period, the interest rate per annum determined by the Bank by
dividing (the resulting quotient rounded upwards, if necessary, to the nearest 1/16th of
1%) (i) the rate of interest determined by the Bank in accordance with its usual procedures
(which determination shall be conclusive absent manifest error) to be the eurodollar rate
two (2) Business Days prior to the first day of such LIBOR Interest Period for an amount
comparable to such advance and having a borrowing date and a maturity comparable to such
LIBOR Interest Period by (ii) a number equal to 1.00 minus the LIBOR Reserve Percentage.

“LIBOR Interest Period” shall mean, as to any advance to which the LIBOR Option applies,
the period of one (1), two (2), three (3) or six (6) month/months as selected by the
Borrower in its notice of borrowing or notice of conversion, as the case may be, commencing
on the date of disbursement of an advance (or the date of conversion of an advance to the
LIBOR Option, as the case may be) and each successive period selected by the Borrower
thereafter; provided that, (i) if a LIBOR Interest Period would end on a
day which is not a Business Day, it shall end on the next succeeding Business Day unless
such day falls in the next succeeding calendar month in which case the LIBOR Interest
Period shall end on the next preceding Business Day, (ii) the Borrower may not select a
LIBOR Interest Period that would end on a day after the Expiration Date, and (iii) any
LIBOR Interest Period that begins on the last Business Day of a calendar month (or a day
for which there is no numerically corresponding day in the last calendar month of such
LIBOR Interest Period) shall end on the last Business Day of the last calendar month of
such LIBOR Interest Period.

“LIBOR Reserve Percentage” shall mean the maximum effective percentage in effect on such
day as prescribed by the Board of Governors of the Federal Reserve System (or any
successor) for determining the reserve requirements (including, without limitation,
supplemental, marginal and emergency reserve requirements) with respect to eurocurrency
funding (currently referred to as “Eurocurrency liabilities”).

LIBOR shall be adjusted with respect to any advance to which the LIBOR Option applies on and as of
the effective date of any change in the LIBOR Reserve Percentage. The Bank shall give prompt
notice to the Borrower of LIBOR as determined or adjusted in accordance herewith, which
determination shall be conclusive absent manifest error.

If the Bank determines (which determination shall be final and conclusive) that, by reason of
circumstances affecting the eurodollar market generally, deposits in dollars (in the applicable
amounts) are not being offered to banks in the eurodollar market for the selected term, or adequate
means do not exist for ascertaining LIBOR, then the Bank shall give notice thereof to the Borrower.
Thereafter, until the Bank notifies the Borrower that the circumstances giving rise to such
suspension no longer exist, (a) the availability of the LIBOR Option shall be suspended, and (b)
the interest rate for all advances then bearing interest under the LIBOR Option shall be converted
at the expiration of the then current LIBOR Interest Period(s) to the Base Rate.

In addition, if, after the date of this Note, the Bank shall determine (which determination shall
be final and conclusive) that any enactment, promulgation or adoption of or any change in any
applicable law, rule or regulation, or any change in the interpretation or administration thereof
by a governmental authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by the Bank with any guideline, request or directive (whether
or not having the force of law) of any such authority, central bank or comparable agency shall make
it unlawful or impossible for the Bank to make or maintain or fund loans based on LIBOR, the Bank
shall notify the Borrower. Upon receipt of such notice, until the Bank notifies the Borrower that
the circumstances giving rise to such determination no longer apply, (a) the availability of the
LIBOR Option shall be suspended, and (b) the interest rate on all advances then bearing interest
under the LIBOR Option shall be converted to the Base Rate either (i) on the last

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day of the then
current LIBOR Interest Period(s) if the Bank may lawfully continue to maintain advances based on
LIBOR to such day, or (ii) immediately if the Bank may not lawfully continue to maintain advances
based on LIBOR.

The foregoing notwithstanding, it is understood that the Borrower may select different Options to
apply simultaneously to different portions of the advances and may select up to six (6) different
interest periods to apply simultaneously to different portions of the advances bearing interest
under the LIBOR Option. Interest hereunder will be calculated based on the actual number of days
that principal is outstanding over a year of 360 days. In no event will the rate of interest
hereunder exceed the maximum rate allowed by law.

3. Interest Rate Election. Subject to the terms and conditions of this Note, at the end of
each interest period applicable to any advance, the Borrower may renew the Option applicable to
such advance or convert such advance to a different Option; provided that, during
any period in which any Event of Default (as hereinafter defined) has occurred and is continuing,
any advances bearing interest under the LIBOR Option shall, at the Bank’s sole discretion, be
converted at the end of the applicable LIBOR Interest Period to the Base Rate and the LIBOR Option
will not be available to Borrower with respect to any new advances (or with respect to the
conversion or renewal of any existing advances) until such Event of Default has been cured by the
Borrower or waived by the Bank. The Borrower shall notify the Bank of each election of an Option,
each conversion from one Option to another, the amount of the advances then outstanding to be
allocated to each Option and where relevant the interest periods therefor. In the case of
converting to the LIBOR Option, such notice shall be given at least three (3) Business Days prior
to the commencement of any LIBOR Interest Period. If no interest period is specified in any such
notice for which the resulting advance is to bear interest under the LIBOR Option, the Borrower
shall be deemed to have selected a LIBOR Interest Period of one month’s duration. If no notice of
election, conversion or renewal is timely received by the Bank with respect to any advance, the
Borrower shall be deemed to have elected the Base Rate Option. Any such election shall be promptly
confirmed in writing by such method as the Bank may require.

4. Advance Procedures. A request for advance made by telephone must be promptly confirmed
in writing by such method as the Bank may require. The Borrower authorizes the Bank to accept
telephonic requests for advances, and the Bank shall be entitled to rely upon the authority of any
person providing such instructions. The Borrower hereby indemnifies and holds the Bank harmless
from and against any and all damages, losses, liabilities, costs and expenses (including reasonable
attorneys’ fees and expenses) which may arise or be created by the acceptance of such telephone
requests or making such advances, if such telephonic requests were made by a person duly authorized
by the Borrower. The Bank will enter on its books and records, which entry when made will be
presumed correct, the date and amount of each advance, the interest rate and interest period
applicable thereto, as well as the date and amount of each payment.

5. Payment Terms. The Borrower shall pay accrued interest on the unpaid principal balance
of this Note in arrears: (a) for the portion of advances bearing interest under the Base Rate
Option or the Fed Funds Rate Option, on the last day of each month during the term hereof, (b) for
the portion of advances bearing interest under the LIBOR Option, on the last day of the respective
LIBOR Interest Period for such advance, (c) if any LIBOR Interest Period is longer than three (3)
months, then also on the three (3) month anniversary of such interest period and every three (3)
months thereafter, and (d) for all advances, at maturity, whether by acceleration of this Note or
otherwise, and after maturity, on demand until paid in full. All outstanding principal and accrued
interest hereunder shall be due and payable in full on the Expiration Date.

If any payment under this Note shall become due on a Saturday, Sunday or public holiday under the
laws of the State where the Bank’s office indicated above is located, such payment shall be made on
the next succeeding Business Day and such extension of time shall be included in computing interest
in connection with such payment. Payments received will be applied to charges, fees and expenses
(including attorneys’ fees), accrued interest and principal in any order the Bank may choose, in
its sole discretion.

6. Late Payments; Default Rate. If the Borrower fails to make any payment of principal,
interest or other amount coming due pursuant to the provisions of this Note within fifteen (15)
calendar days of the date due and payable, the Borrower also shall pay to the Bank a late charge
equal to the lesser of five percent (5%) of the amount of such payment or $100.00 (the “Late
Charge”). Such fifteen (15) day period shall not be construed in any way to extend the due date of
any such payment. Upon maturity, whether by acceleration, demand or otherwise, and at the

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Bank’s
option upon the occurrence of any Event of Default (as hereinafter defined) and during the
continuance thereof, each advance outstanding under this Note shall bear interest at a rate per
annum (based on the actual number of days that principal is outstanding over a year of 360 days)
which shall be two percentage points (2%) in excess of the interest rate in effect from time to
time under this Note but not more than the maximum rate allowed by law (the “Default Rate”). The
Default Rate shall continue to apply whether or not judgment shall be entered on this Note. Both
the Late Charge and the Default Rate are imposed as liquidated damages for the purposes of
defraying the Bank’s expenses incident to the handling of delinquent payments, but are in addition
to, and not in lieu of, the Bank’s exercise of any rights and remedies hereunder, under the other
Loan Documents or under applicable law, and any fees and expenses of any agents or attorneys which
the Bank may employ. In addition, the Default Rate reflects the increased credit risk to the Bank
of carrying a loan that is in default. The Borrower agrees that the Late Charge and Default Rate
are reasonable forecasts of just compensation for anticipated and actual harm
incurred by the Bank, and that the actual harm incurred by the Bank cannot be estimated with
certainty and without difficulty.

7. Prepayment. The Borrower shall have the right to prepay any advance hereunder at any
time and from time to time, in whole or in part; subject, however, to payment of any break funding
indemnification amounts owing pursuant to paragraph 8 below.

8. Yield Protection; Break Funding Indemnification. The Borrower shall pay to the Bank on
written demand therefor, together with the written evidence of the justification therefor, all
direct costs incurred, losses suffered or payments made by Bank by reason of any change in law or
regulation or its interpretation imposing any reserve, deposit, allocation of capital, or similar
requirement (including without limitation, Regulation D of the Board of Governors of the Federal
Reserve System) on the Bank, its holding company or any of their respective assets. In addition,
the Borrower agrees to indemnify the Bank against any liabilities, losses or expenses (including,
without limitation, loss of margin, any loss or expense sustained or incurred in liquidating or
employing deposits from third parties, and any loss or expense incurred in connection with funds
acquired to effect, fund or maintain any advance (or any part thereof) bearing interest under the
LIBOR Option) which the Bank sustains or incurs as a consequence of either (i) the Borrower’s
failure to make a payment on the due date thereof, (ii) the Borrower’s revocation (expressly, by
later inconsistent notices or otherwise) in whole or in part of any notice given to Bank to
request, convert, renew or prepay any advance bearing interest under the LIBOR Option, or (iii) the
Borrower’s payment or prepayment (whether voluntary, after acceleration of the maturity of this
Note or otherwise) or conversion of any advance bearing interest under the LIBOR Option on a day
other than the last day of the applicable LIBOR Interest Period. A notice as to any amounts
payable pursuant to this paragraph given to the Borrower by the Bank shall, in the absence of
manifest error, be conclusive and shall be payable upon demand. The Borrower’s indemnification
obligations hereunder shall survive the payment in full of the advances and all other amounts
payable hereunder.

9. Other Loan Documents. This Note is issued in connection with a loan agreement between
the Borrower and the Bank, dated on or before the date hereof, and the other agreements and
documents executed and/or delivered in connection therewith or referred to therein, the terms of
which are incorporated herein by reference (as amended, modified or renewed from time to time,
collectively the “Loan Documents”), and is secured by the property (if any) described in the Loan
Documents and by such other collateral as previously may have been or may in the future be granted
to the Bank to secure this Note.

10. Events of Default. The occurrence of any of the following events will be deemed to be
an “Event of Default” under this Note: (i) the nonpayment of any principal, interest or other
indebtedness under this Note when due; (ii) the occurrence of any event of default or any default
and the lapse of any notice or cure period, or any Obligor’s failure to observe or perform any
covenant or other agreement, under or contained in any Loan Document or any other document now or
in the future evidencing or securing any debt, liability or obligation of any Obligor to the Bank
in excess of $5,000,000.00; (iii) the filing by or against any Obligor of any proceeding in
bankruptcy, receivership, insolvency, reorganization, liquidation, conservatorship or similar
proceeding (and, in the case of any such proceeding instituted against any Obligor, such proceeding
is not dismissed or stayed within 30 days of the commencement thereof, provided that the Bank shall
not be obligated to advance additional funds hereunder during such period); (iv) any assignment by
any Obligor for the benefit of creditors, or any levy, garnishment, attachment or similar
proceeding is instituted against any property of any Obligor held by or deposited with the Bank;
(v) a default with respect to any other indebtedness of any Obligor for borrowed money in excess of
$5,000,000.00, if the effect of such default is to cause or permit the acceleration of
such debt; (vi) the commencement of any foreclosure or forfeiture

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proceeding, execution or attachment against any collateral securing the obligations of any Obligor to the Bank; (vii) the
entry of a final judgment against any Obligor and the failure of such Obligor to discharge the
judgment within ten (10) days of the entry thereof; (viii) any material adverse change in any
Obligor’s business, assets, operations, financial condition or results of operations; (ix) any
Obligor ceases doing business as a going concern; (x) any representation or warranty made by any
Obligor to the Bank in any Loan Document or any other documents now or in the future evidencing or
securing the obligations of any Obligor to the Bank, is false, erroneous or misleading in any
material respect; (xi) if this Note or any guarantee executed by any Obligor is secured, the
failure of any Obligor to provide the Bank with additional collateral if in the Bank’s opinion at
any time or times, the market value of any of the collateral securing this Note or any guarantee
has depreciated below that required pursuant to the Loan Documents or, if no specific value is so
required, then in an amount deemed material by the Bank; (xii) the revocation or attempted
revocation, in whole or in part, of any guarantee by any Obligor; or (xiii) the death,
incarceration, indictment or legal incompetency of any individual Obligor or, if any Obligor is a
partnership or limited liability company, the death, incarceration, indictment or legal
incompetency of any individual general partner or member. As used herein, the term “Obligor” means
any Borrower and any guarantor of, or any pledgor, mortgagor or other person or entity providing
collateral support for, the Borrower’s obligations to the Bank existing on the date of this Note or
arising in the future.

Upon the occurrence of an Event of Default: (a) the Bank shall be under no further obligation to
make advances hereunder; (b) if an Event of Default specified in clause (iii) or (iv) above shall
occur, the outstanding principal balance and accrued interest hereunder together with any
additional amounts payable hereunder shall be immediately due and payable without demand or notice
of any kind; (c) if any other Event of Default shall occur, the outstanding principal balance and
accrued interest hereunder together with any additional amounts payable hereunder, at the Bank’s
option and without demand or notice of any kind, may be accelerated and become immediately due and
payable; (d) at the Bank’s option, this Note will bear interest at the Default Rate from the date
of the occurrence of the Event of Default; and (e) the Bank may exercise from time to time any of
the rights and remedies available under the Loan Documents or under applicable law.

11. Right of Setoff. In addition to all liens upon and rights of setoff against the
Borrower’s money, securities or other property given to the Bank by law, the Bank shall have, with
respect to the Borrower’s obligations to the Bank under this Note and to the extent permitted by
law, a contractual possessory security interest in and a contractual right of setoff against, and
the Borrower hereby grants the Bank a security interest in, and hereby assigns, conveys, delivers,
pledges and transfers to the Bank, all of the Borrower’s right, title and interest in and to, all
of the Borrower’s deposits, moneys, securities and other property now or hereafter in the
possession of or on deposit with, or in transit to, the Bank or any other direct or indirect
subsidiary of The PNC Financial Services Group, Inc., whether held in a general or special account
or deposit, whether held jointly with someone else, or whether held for safekeeping or otherwise,
excluding, however, all IRA, Keogh, and trust accounts. Every such security interest and right of
setoff may be exercised without demand upon or notice to the Borrower. Every such right of setoff
shall be deemed to have been exercised immediately upon the occurrence of an Event of Default
hereunder without any action of the Bank, although the Bank may enter such setoff on its books and
records at a later time.

12. Indemnity. The Borrower agrees to indemnify each of the Bank, each legal entity, if
any, who controls, is controlled by or is under common control with the Bank, and each of their
respective directors, officers and employees (the “Indemnified Parties”), and to hold each
Indemnified Party harmless from and against any and all claims, damages, losses, liabilities and
expenses (including all fees and charges of internal or external counsel with whom any Indemnified
Party may consult and all expenses of litigation and preparation therefor) which any Indemnified
Party may incur or which may be asserted against any Indemnified Party by any person, entity or
governmental authority (including any person or entity claiming derivatively on behalf of the
Borrower), in connection with or arising out of or relating to the matters referred to in this Note
or in the other Loan Documents or the use of any advance hereunder, whether (a) arising from or
incurred in connection with any breach of a representation, warranty or covenant by the Borrower,
or (b) arising out of or resulting from any suit, action, claim, proceeding or governmental
investigation, pending or threatened, whether based on statute, regulation or order, or tort, or
contract or otherwise, before any court or governmental authority; provided,
however, that the foregoing indemnity agreement shall not apply to any claims, damages,
losses, liabilities and expenses solely attributable to an Indemnified Party’s gross negligence or
willful misconduct. The indemnity agreement contained in this Section shall survive the
termination of this Note, payment of any advance hereunder and the assignment of any rights
hereunder. The Borrower may participate at its expense in the defense of any such action or claim.

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13. Miscellaneous. All notices, demands, requests, consents, approvals and other
communications required or permitted hereunder (“Notices”) must be in writing (except as may be
agreed otherwise above with respect to borrowing requests) and will be effective upon receipt.
Notices may be given in any manner to which the parties may separately agree, including electronic
mail. Without limiting the foregoing, first-class mail, facsimile transmission and commercial
courier service are hereby agreed to as acceptable methods for giving Notices. Regardless of the
manner in which provided, Notices may be sent to a party’s address as set forth above or to such
other address as any party may give to the other for such purpose in accordance with this
paragraph. No delay or omission on the Bank’s part to exercise any right or power arising
hereunder will impair any such right or power or be considered a waiver of any such right or power,
nor will the Bank’s action or inaction impair any such right or power. The Bank’s rights and
remedies hereunder are cumulative and not exclusive of any other rights or remedies which the Bank
may have under other agreements, at law or in equity. No modification, amendment or waiver of, or
consent to any departure by the Borrower from, any provision of this Note will be effective unless
made in a writing signed by the Bank, and then such waiver or consent shall be effective only in
the specific instance and for the purpose for which given. The Borrower agrees to pay on demand,
to the extent permitted by law, all costs and expenses incurred by the Bank in the enforcement of
its rights in this Note and in any security therefor, including without limitation reasonable fees
and expenses of the Bank’s counsel. If any provision of this Note is found to be invalid, illegal
or unenforceable in any respect by a court, all the other provisions of this Note will remain in
full force and effect. The Borrower and all other makers and indorsers of this Note hereby forever
waive presentment, protest, notice of dishonor and notice of non-payment. The Borrower also waives
all defenses based on suretyship or impairment of collateral. If this Note is executed by more
than one Borrower, the obligations of such persons or entities hereunder will be joint and several.
This Note shall bind the Borrower and its heirs, executors, administrators, successors and
assigns, and the benefits hereof shall inure to the benefit of the Bank and its successors and
assigns; provided, however, that the Borrower may not assign this Note in whole or
in part without the Bank’s written consent and the Bank at any time may assign this Note in whole
or in part.

This Note has been delivered to and accepted by the Bank and will be deemed to be made in the State
where the Bank’s office indicated above is located. This Note will be interpreted and the
rights and liabilities of the Bank and the Borrower determined in accordance with the laws of the
State where the Bank’s office indicated above is located, excluding its conflict of laws
rules. The Borrower hereby
irrevocably consents to the exclusive jurisdiction of any state or federal court in the county or
judicial district where the Bank’s office indicated above is located; provided that nothing
contained in this Note will prevent the Bank from bringing any action, enforcing any award or
judgment or exercising any rights against the Borrower individually, against any security or
against any property of the Borrower within any other county, state or other foreign or domestic
jurisdiction. The Borrower acknowledges and agrees that the venue provided above is the most
convenient forum for both the Bank and the Borrower. The Borrower waives any objection to venue
and any objection based on a more convenient forum in any action instituted under this Note.

14. Commercial Purpose. The Borrower represents that the indebtedness evidenced by this
Note is being incurred by the Borrower solely for the purpose of acquiring or carrying on a
business, professional or commercial activity, and not for personal, family or household purposes.

15. WAIVER OF JURY TRIAL. The Borrower irrevocably waives any and all rights the
Borrower may have to a trial by jury in any action, proceeding or claim of any nature relating to
this Note, any documents executed in connection with this Note or any transaction contemplated in
any of such documents. The Borrower acknowledges that the foregoing waiver is knowing and
voluntary.

The Borrower acknowledges that it has read and understood all the provisions of this Note,
including the waiver of jury trial, and has been advised by counsel as necessary or appropriate.

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WITNESS the due execution hereof as a document under seal, as of the date first written above, with
the intent to be legally bound hereby.

	 	 	 	 
	WITNESS / ATTEST:	 	 	ERIE INDEMNITY COMPANY
	 
	 	 	 
	/s/ Donald A. McRae

	 	By: 	 /s/ Philip A. Garcia
	 

	 	 	 
	Print Name: Donald A. McRae

	 	 	Print Name: Philip A. Garcia
	Title:            Assistant Vice President

	 	 	Title:            Executive Vice President & CFO
	(Include title only if an officer of
entity signing to the right)
	 	 	 

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	 Third Amended and Restated

Committed Line Of Credit Note

(Multi-Rate Options)

	 	
	 
	 	 
	$100,000,000.00

	 	December 29, 2008

FOR VALUE RECEIVED, ERIE INDEMNITY COMPANY (the “Borrower”), with an address at 100 Erie Insurance
Place, Erie, Pennsylvania 16530, promises to pay to the order of PNC BANK, NATIONAL ASSOCIATION
(the “Bank”), in lawful money of the United States of America in immediately available funds at its
offices located at 901 State Street, P.O. Box 8480, Erie, Pennsylvania 16553, or at such other
location as the Bank may designate from time to time, the principal sum of ONE HUNDRED MILLION
DOLLARS ($100,000,000.00) (the “Facility”) or such lesser amount as may be advanced to or for the
benefit of the Borrower hereunder, together with interest accruing on the outstanding principal
balance from the date hereof, all as provided below.

1. Advances. The Borrower may request advances, repay and request additional advances
hereunder until
the Expiration Date, subject to the terms and conditions of this Note and the Loan Documents (as
hereinafter
defined). The “Expiration Date” shall mean December 31, 2009, or such later date as may be
designated by the
Bank by written notice from the Bank to the Borrower. The Borrower acknowledges and agrees that in
no event
will the Bank be under any obligation to extend or renew the Facility or this Note beyond the
Expiration Date.
The Borrower may request advances hereunder upon giving oral or written notice to the Bank by 11:00
a.m. (Erie,
Pennsylvania time) (a) on the day of the proposed advance, in the case of advances to bear interest
under the Base
Rate Option (as hereinafter defined), and (b) three (3) Business Days prior to the proposed
advance, in the case of
advances to bear interest under the LIBOR Option (as hereinafter defined), followed promptly
thereafter by the
Borrower’s written confirmation to the Bank of any oral notice. The aggregate unpaid principal
amount of
advances under this Note shall not exceed the face amount of this Note.

2. Rate of Interest. Each advance outstanding under this Note will bear interest at a rate
or rates per annum as may be selected by the Borrower from the interest rate options set forth below (each, an
“Option”):

     (i) Base Rate Option. A rate of interest per annum which is at all times equal to (A)
the Base Rate plus (B) one hundred twelve and one-half (112.5) basis points (1.125%). If
and when the Base Rate (or any component thereof) changes, the rate of interest with respect to
any advance to which the Base Rate Option applies will change automatically without notice to the
Borrower, effective on the date of any such change. There are no required minimum interest periods
for advances bearing interest under the Base Rate Option.

     (ii) LIBOR Option. A rate per annum equal to (A) LIBOR plus (B) one hundred
twelve and one-half (112.5) basis points (1.125%), for the applicable LIBOR Interest Period.

For purposes hereof, the following terms shall have the following meanings:

“Base Rate” shall mean the highest of (A) the Prime Rate, and (B) the sum of the Federal
Funds Open Rate plus fifty (50) basis points (0.50%), and (C) the sum of the Daily
LIBOR Rate plus one hundred (100) basis points (1.0%), so long as a Daily LIBOR
Rate is offered, ascertainable and not unlawful.

“Business Day” shall mean any day other than a Saturday or Sunday or a legal holiday on
which commercial banks are authorized or required by law to be closed for business in Erie,
Pennsylvania.

“Daily LIBOR Rate” shall mean, for any day, the rate per annum determined by the Bank by
dividing (x) the Published Rate by (y) a number equal to 1.00 minus the LIBOR
Reserve Percentage.

 

 

“Federal Funds Open Rate” shall mean, for any day, the rate per annum determined by the Bank
in accordance with its usual procedures (which determination shall be conclusive absent
manifest error) to be the Open Rate for federal funds transactions as of the opening of
business for federal funds transactions among members of the Federal Reserve System arranged
by federal funds brokers on such day, as quoted by Garvin Guybutler, any successor entity
thereto, or any other broker selected by the Bank, as set forth on the applicable Telerate
display page; provided, however, that if such day is not a Business Day, the Federal Funds
Rate for such day shall be the Open Rate on the immediately preceding Business Day, or if no
such rate shall be quoted by a federal funds broker at such time, such other rate as
determined by the Bank in accordance with its usual procedures. The rate of interest charged
shall be adjusted as of each Business Day based on changes in the Federal Funds Open Rate
without notice to the Borrower.

“LIBOR” shall mean, with respect to any advance to which the LIBOR Option applies for the
applicable LIBOR Interest Period, the interest rate per annum determined by the Bank by
dividing (the resulting quotient rounded upwards, at the Bank’s discretion, to the nearest
1/100th of 1%) (i) the rate of interest determined by the Bank in accordance with its usual
procedures (which determination shall be conclusive absent manifest error) to be the eurodollar
rate two (2) Business Days prior to the first day of such LIBOR Interest Period for
an amount comparable to such advance and having a borrowing date and a maturity comparable
to such LIBOR Interest Period by (ii) a number equal to 1.00 minus the LIBOR Reserve
Percentage.

“LIBOR Interest Period” shall mean, as to any advance to which the LIBOR Option applies,
the period of one (1), two (2), three (3) or six (6) month/months as selected by the
Borrower in its notice of borrowing or notice of conversion, as the case may be, commencing
on the date of disbursement of an advance (or the date of conversion of an advance to the
LIBOR Option, as the case may be) and each successive period selected by the Borrower
thereafter; provided that, (i) if a LIBOR Interest Period would end on a day which
is not a Business Day, it shall end on the next succeeding Business Day unless such day
falls in the next succeeding calendar month in which case the LIBOR Interest Period shall
end on the next preceding Business Day, (ii) the Borrower may not select a LIBOR Interest
Period that would end on a day after the Expiration Date, and (iii) any LIBOR Interest
Period that begins on the last Business Day of a calendar month (or a day for which there
is no numerically corresponding day in the last calendar month of such LIBOR Interest
Period) shall end on the last Business Day of the last calendar month of such LIBOR
Interest Period.

“LIBOR Reserve Percentage” shall mean the maximum effective percentage in effect on such
day as prescribed by the Board of Governors of the Federal Reserve System (or any
successor) for determining the reserve requirements (including, without limitation,
supplemental, marginal and emergency reserve requirements) with respect to eurocurrency
funding (currently referred to as “Eurocurrency liabilities”).

“Prime Rate” shall mean the rate publicly announced by the Bank from time to time as its
prime rate. The Prime Rate is determined from time to time by the Bank as a means of
pricing some loans to its borrowers. The Prime Rate is not tied to any external rate of
interest or index, and does not necessarily reflect the lowest rate of interest actually
charged by the Bank to any particular class or category of customers.

“Published Rate” shall mean the rate of interest published each Business Day in the Wall
Street Journal “Money Rates” listing under the caption “London Interbank Offered Rates” for
a one month period (or, if no such rate is published therein for any reason, then the
Published Rate shall be the eurodollar rate for a one month period as published in another
publication selected by the Bank).

LIBOR and the Daily LIBOR Rate shall be adjusted with respect to any advance to which the LIBOR
Option or Base Rate Option applies, as applicable, on and as of the effective date of any change in
the LIBOR Reserve

-2-

 

Percentage. The Bank shall give prompt notice to the Borrower of LIBOR or the Daily LIBOR Rate as
determined or adjusted in accordance herewith, which determination shall be conclusive absent
manifest error.

If the Bank determines (which determination shall be final and conclusive) that, by reason of
circumstances affecting the eurodollar market generally, deposits in dollars (in the applicable
amounts) are not being offered to banks in the eurodollar market for the selected term, or
adequate means do not exist for ascertaining LIBOR, then the Bank shall give notice thereof to the
Borrower. Thereafter, until the Bank notifies the Borrower that the circumstances giving rise to
such suspension no longer exist, (a) the availability of the LIBOR Option shall be suspended, and
(b) the interest rate for all advances then bearing interest under the LIBOR Option shall be
converted at the expiration of the then current LIBOR Interest Period(s) to the Base Rate Option.

In addition, if, after the date of this Note, the Bank shall determine (which determination shall
be final and conclusive) that any enactment, promulgation or adoption of or any change in any
applicable law, rule or regulation, or any change in the interpretation or administration thereof
by a governmental authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by the Bank with any guideline, request or directive
(whether or not having the force of law) of any such authority, central bank or comparable agency
shall make it unlawful or impossible for the Bank to make or maintain or fund loans based on
LIBOR, the Bank shall notify the Borrower. Upon receipt of such notice, until the Bank notifies
the Borrower that the circumstances giving rise to such determination no longer apply, (a) the
availability of the LIBOR Option shall be suspended, and (b) the interest rate on all advances
then bearing interest under the LIBOR Option shall be converted to the Base Rate Option either (i)
on the last day of the then current LIBOR Interest Period(s) if the Bank may lawfully continue to
maintain advances based on LIBOR to such day, or (ii) immediately if the Bank may not lawfully
continue to maintain advances based on LIBOR.

The foregoing notwithstanding, it is understood that the Borrower may select different Options to
apply simultaneously to different portions of the advances and may select up to six (6) different
interest periods to apply simultaneously to different portions of the advances bearing interest
under the LIBOR Option. Interest hereunder will be calculated based on the actual number of days
that principal is outstanding over a year of 360 days. In no event will the rate of interest
hereunder exceed the maximum rate allowed by law.

3. Interest Rate Election. Subject to the terms and conditions of this Note, at the end
of each interest
period applicable to any advance, the Borrower may renew the Option applicable to such advance or
convert such
advance to a different Option; provided that, during any period in which any Event of
Default (as hereinafter
defined) has occurred and is continuing, any advances bearing interest under the LIBOR Option
shall, at the
Bank’s sole discretion, be converted at the end of the applicable LIBOR Interest Period to the Base
Rate Option
and the LIBOR Option will not be available to Borrower with respect to any new advances (or with
respect to the
conversion or renewal of any existing advances) until such Event of Default has been cured by the
Borrower or
waived by the Bank. The Borrower shall notify the Bank of each election of an Option, each
conversion from one
Option to another, the amount of the advances then outstanding to be allocated to each Option and
where relevant
the interest periods therefor. In the case of converting to the LIBOR Option, such notice shall be
given at least
three (3) Business Days prior to the commencement of any LIBOR Interest Period. If no interest
period is
specified in any such notice for which the resulting advance is to bear interest under the LIBOR
Option, the
Borrower shall be deemed to have selected a LIBOR Interest Period of one month’s duration. If no
notice of
election, conversion or renewal is timely received by the Bank with respect to any advance, the
Borrower shall be
deemed to have elected the Base Rate Option. Any such election shall be promptly confirmed in
writing by such
method as the Bank may require.

4. Advance Procedures. A request for advance made by telephone must be promptly confirmed
in writing
by such method as the Bank may require. The Borrower authorizes the Bank to accept telephonic
requests for
advances, and the Bank shall be entitled to rely upon the authority of any person providing such
instructions. The
Borrower hereby indemnifies and holds the Bank harmless from and against any and all damages,
losses,
liabilities, costs and expenses (including reasonable attorneys’ fees and expenses) which may arise
or be created
by the acceptance of such telephone requests or making such advances, if such telephonic requests
were made by
a person duly authorized by the Borrower. The Bank will enter on its books and records, which entry
when made

-3-

 

will be presumed correct, the date and amount of each advance, the interest rate and interest
period applicable thereto, as well as the date and amount of each payment.

5. Payment Terms. The Borrower shall pay accrued interest on the unpaid principal balance
of this Note in arrears: (a) for the portion of advances bearing interest under the Base Rate
Option, on the last day of each month during the term hereof, (b) for the portion of advances
bearing interest under the LIBOR Option, on the last day of the respective LIBOR Interest Period
for such advance, (c) if any LIBOR Interest Period is longer than three (3) months, then also on
the three (3) month anniversary of such interest period and every three (3) months thereafter, and
(d) for all advances, at maturity, whether by acceleration of this Note or otherwise, and after
maturity, on demand until paid in full. All outstanding principal and accrued interest hereunder
shall be due and payable in full on the Expiration Date.

If any payment under this Note shall become due on a Saturday, Sunday or public holiday under the
laws of the State where the Bank’s office indicated above is located, such payment shall be made
on the next succeeding Business Day and such extension of time shall be included in computing
interest in connection with such payment. Payments received will be applied to charges, fees and
expenses (including attorneys’ fees), accrued interest and principal in any order the Bank may
choose, in its sole discretion.

6. Late Payments; Default Rate. If the Borrower fails to make any payment of principal,
interest or other amount coming due pursuant to the provisions of this Note within fifteen (15)
calendar days of the date due and payable, the Borrower also shall pay to the Bank a late charge
equal to the lesser of five percent (5%) of the amount of such
payment or $100.00 (the “Late
Charge”). Such fifteen (15) day period shall not be construed in any way to extend the due date of
any such payment. Upon maturity, whether by acceleration, demand or otherwise, and at the Bank’s
option upon the occurrence of any Event of Default (as hereinafter defined) and during the
continuance thereof, each advance outstanding under this Note shall bear interest at a rate per
annum (based on the actual number of days that principal is outstanding over a year of 360 days)
which shall be two percentage points (2%) in excess of the interest rate in effect from time to
time under this Note but not more than the maximum rate allowed by law (the “Default Rate”). The
Default Rate shall continue to apply whether or not judgment shall be entered on this Note. Both
the Late Charge and the Default Rate are imposed as liquidated damages for the purposes of
defraying the Bank’s expenses incident to the handling of delinquent payments, but are in addition
to, and not in lieu of, the Bank’s exercise of any rights and remedies hereunder, under the other
Loan Documents or under applicable law, and any fees and expenses of any agents or attorneys which
the Bank may employ. In addition, the Default Rate reflects the increased credit risk to the Bank
of carrying a loan that is in default. The Borrower agrees that the Late Charge and Default Rate
are reasonable forecasts of just compensation for anticipated and actual harm incurred by the Bank,
and that the actual harm incurred by the Bank cannot be estimated with certainty and without
difficulty.

7. Prepayment. The Borrower shall have the right to prepay any advance hereunder at any
time and from time to time, in whole or in part; subject, however, to payment of any break funding
indemnification amounts owing pursuant to paragraph 8 below.

8. Yield Protection; Break Funding Indemnification. The Borrower shall pay to the Bank on
written demand therefor, together with the written evidence of the justification therefor, all
direct costs incurred, losses suffered or payments made by Bank by reason of any change in law or
regulation or its interpretation imposing any reserve, deposit, allocation of capital, or similar
requirement (including without limitation, Regulation D of the Board of Governors of the Federal
Reserve System) on the Bank, its holding company or any of their respective assets. In addition,
the Borrower agrees to indemnify the Bank against any liabilities, losses or expenses (including,
without limitation, loss of margin, any loss or expense sustained or incurred in liquidating or
employing deposits from third parties, and any loss or expense incurred in connection with funds
acquired to effect, fund or maintain any advance (or any part thereof) bearing interest under the
LIBOR Option) which the Bank sustains or incurs as a consequence of either (i) the Borrower’s
failure to make a payment on the due date thereof, (ii) the Borrower’s revocation (expressly, by
later inconsistent notices or otherwise) in whole or in part of any notice given to Bank to
request, convert, renew or prepay any advance bearing interest under the LIBOR Option, or (iii) the
Borrower’s payment or prepayment (whether voluntary, after acceleration of the maturity of this
Note or otherwise) or conversion of any advance bearing interest under the LIBOR Option on a day
other

-4-

 

than the last day of the applicable LIBOR Interest Period. A notice as to any amounts payable
pursuant to this paragraph given to the Borrower by the Bank shall, in the absence of manifest
error, be conclusive and shall be payable upon demand. The Borrower’s indemnification obligations
hereunder shall survive the payment in full of the advances and all other amounts payable
hereunder.

9. Other Loan Documents. This Note is issued in connection with that certain Loan Agreement
between the Borrower and the Bank, dated January 30, 2008, and the other agreements and documents
executed and/or delivered in connection therewith or referred to therein, the terms of which are
incorporated herein by reference (as amended, modified or renewed from time to time, collectively
the “Loan Documents”), and is secured by the property (if any) described in the Loan Documents and
by such other collateral as previously may have been or may in the future be granted to the Bank to
secure this Note.

10. Events of Default. The occurrence of any of the following events will be deemed to be
an “Event of Default” under this Note: (i) the nonpayment of any principal, interest or other indebtedness
under this Note when due; (ii) the occurrence of any event of default or any default and the lapse
of any notice or cure period, or any Obligor’s failure to observe or perform any covenant or other
agreement, under or contained in any Loan Document or any other document now or in the future
evidencing or securing any debt, liability or obligation of any Obligor to the Bank in excess of
$5,000,000.00; (iii) the filing by or against any Obligor of any proceeding in bankruptcy,
receivership, insolvency, reorganization, liquidation, conservatorship or similar proceeding (and,
in the case of any such proceeding instituted against any Obligor, such proceeding is not
dismissed or stayed within 30 days of the commencement thereof, provided that the Bank shall not
be obligated to advance additional funds hereunder during such period); (iv) any assignment by any
Obligor for the benefit of creditors, or any levy, garnishment, attachment or similar proceeding
is instituted against any property of any Obligor held by or deposited with the Bank; (v) a
default with respect to any other indebtedness of any Obligor for borrowed money in excess of
$5,000,000.00, if the effect of such default is to cause or permit the acceleration of such debt;
(vi) the commencement of any foreclosure or forfeiture proceeding, execution or attachment against
any collateral securing the obligations of any Obligor to the Bank; (vii) the entry of a final
judgment against any Obligor and the failure of such Obligor to discharge the judgment within ten
(10) days of the entry thereof; (viii) any material adverse change in any Obligor’s business,
assets, operations, financial condition or results of operations; (ix) any Obligor ceases doing
business as a going concern; (x) any representation or warranty made by any Obligor to the Bank in
any Loan Document or any other documents now or in the future evidencing or securing the
obligations of any Obligor to the Bank, is false, erroneous or misleading in any material respect;
(xi) if this Note or any guarantee executed by any Obligor is secured, the failure of any Obligor
to provide the Bank with additional collateral if in the Bank’s opinion at any time or times, the
market value of any of the collateral securing this Note or any guarantee has depreciated below
that required pursuant to the Loan Documents or, if no specific value is so required, then in an
amount deemed material by the Bank; (xii) the revocation or attempted revocation, in whole or in
part, of any guarantee by any Obligor; or (xiii) the death, incarceration, indictment or legal
incompetency of any individual Obligor or, if any Obligor is a partnership or limited liability
company, the death, incarceration, indictment or legal incompetency of any individual general
partner or member. As used herein, the term “Obligor” means any Borrower and any guarantor of, or
any pledgor, mortgagor or other person or entity providing collateral support for, the Borrower’s
obligations to the Bank existing on the date of this Note or arising in the future.

Upon the occurrence of an Event of Default: (a) the Bank shall be under no further obligation to
make advances hereunder; (b) if an Event of Default specified in clause (iii) or (iv) above shall
occur, the outstanding principal balance and accrued interest hereunder together with any
additional amounts payable hereunder shall be immediately due and payable without demand or notice
of any kind; (c) if any other Event of Default shall occur, the outstanding principal balance and
accrued interest hereunder together with any additional amounts payable hereunder, at the Bank’s
option and without demand or notice of any kind, may be accelerated and become immediately due and
payable; (d) at the Bank’s option, this Note will bear interest at the Default Rate from the date
of the occurrence of the Event of Default; and (e) the Bank may exercise from time to time any of
the rights and remedies available under the Loan Documents or under applicable law.

11. Right of Setoff. In addition to all liens upon and rights of setoff against the
Borrower’s money, securities or other property given to the Bank by law, the Bank shall have, with
respect to the Borrower’s obligations to the

-5-

 

Bank under this Note and to the extent permitted by law, a contractual possessory security interest
in and a contractual right of setoff against, and the Borrower hereby grants the Bank a security
interest in, and hereby assigns, conveys, delivers, pledges and transfers to the Bank, all of the
Borrower’s right, title and interest in and to, all of the Borrower’s deposits, moneys, securities
and other property now or hereafter in the possession of or on deposit with, or in transit to, the
Bank or any other direct or indirect subsidiary of The PNC Financial Services Group, Inc., whether
held in a general or special account or deposit, whether held jointly with someone else, or whether
held for safekeeping or otherwise, excluding, however, all IRA, Keogh, and trust accounts. Every
such security interest and right of setoff may be exercised without demand upon or notice to the
Borrower. Every such right of setoff shall be deemed to have been exercised immediately upon the
occurrence of an Event of Default hereunder without any action of the Bank, although the Bank may
enter such setoff on its books and records at a later time.

12. Indemnity. The Borrower agrees to indemnify each of the Bank, each legal entity, if
any, who controls, is controlled by or is under common control with the Bank, and each of their
respective directors, officers and employees (the “Indemnified Parties”), and to hold each
Indemnified Party harmless from and against any and all claims, damages, losses, liabilities and
expenses (including all fees and charges of internal or external counsel with whom any Indemnified
Party may consult and all expenses of litigation and preparation therefor) which any Indemnified
Party may incur or which may be asserted against any Indemnified Party by any person, entity or
governmental authority (including any person or entity claiming derivatively on behalf of the
Borrower), in connection with or arising out of or relating to the matters referred to in this Note
or in the other Loan Documents or the use of any advance hereunder, whether (a) arising from or
incurred in connection with any breach of a representation, warranty or covenant by the Borrower,
or (b) arising out of or resulting from any suit, action, claim, proceeding or governmental
investigation, pending or threatened, whether based on statute, regulation or order, or tort, or
contract or otherwise, before any court or governmental authority; provided,
however, that the foregoing indemnity agreement shall not apply to any claims, damages,
losses, liabilities and expenses solely attributable to an Indemnified Party’s gross negligence or
willful misconduct. The indemnity agreement contained in this Section shall survive the termination
of this Note, payment of any advance hereunder and the assignment of any rights hereunder. The
Borrower may participate at its expense in the defense of any such action or claim.

13. Amendment and Restatement. This Note amends and restates, and is in substitution for,
that certain Second Amended and Restated Committed Line of Credit Note in the original
principal amount of $100,000,000.00 payable to the order of the Bank and dated June 30, 2008 (the
“Existing Note”). However, without duplication, this Note shall in no way extinguish, cancel or
satisfy Borrower’s unconditional obligation to repay all indebtedness evidenced by the Existing
Note or constitute a novation of the Existing Note. Nothing herein is intended to extinguish,
cancel or impair the lien priority or effect of any security agreement, pledge agreement or
mortgage with respect to any Obligor’s obligations hereunder and under any other document relating
hereto.

14. Miscellaneous. All notices, demands, requests, consents, approvals and other
communications required or permitted hereunder (“Notices”) must be in writing (except as may be
agreed otherwise above with respect to borrowing requests) and will be effective upon receipt.
Notices may be given in any manner to which the parties may separately agree, including electronic
mail. Without limiting the foregoing, first-class mail, facsimile transmission and commercial
courier service are hereby agreed to as acceptable methods for giving Notices. Regardless of the
manner in which provided, Notices may be sent to a party’s address as set forth above or to such
other address as any party may give to the other for such purpose in accordance with this
paragraph. No delay or omission on the Bank’s part to exercise any right or power arising hereunder
will impair any such right or power or be considered a waiver of any such right or power, nor will
the Bank’s action or inaction impair any such right or power. The Bank’s rights and remedies
hereunder are cumulative and not exclusive of any other rights or remedies which the Bank may have
under other agreements, at law or in equity. No modification, amendment or waiver of, or consent to
any departure by the Borrower from, any provision of this Note will be effective unless made in a
writing signed by the Bank, and then such waiver or consent shall be effective only in the specific
instance and for the purpose for which given. The Borrower agrees to pay on demand, to the extent
permitted by law, all costs and expenses incurred by the Bank in the enforcement of its rights in
this Note and in any security therefor, including without limitation reasonable fees and expenses
of the Bank’s counsel. If any provision of this Note is found to be invalid, illegal or
unenforceable in any respect by a court, all the other provisions of this Note

-6-

 

will remain in full force and effect. The Borrower and all other makers and indorsers of this Note
hereby forever waive presentment, protest, notice of dishonor and notice of non-payment. The
Borrower also waives all defenses based on suretyship or impairment of collateral. If this Note is
executed by more than one Borrower, the obligations of such persons or entities hereunder will be
joint and several. This Note shall bind the Borrower and its heirs, executors, administrators,
successors and assigns, and the benefits hereof shall inure to the benefit of the Bank and its
successors and assigns; provided, however, that the Borrower may not assign this
Note in whole or in part without the Bank’s written consent and the Bank at any time may assign
this Note in whole or in part.

This Note has been delivered to and accepted by the Bank and will be deemed to be made in the
State where the Bank’s office indicated above is located. This note will be interpreted and the
rights and liabilities of the bank and the borrower determined in accordance with the laws of
the State where the Bank’s office indicated above is located, excluding its conflict of laws
rules. The Borrower hereby irrevocably consents to the exclusive jurisdiction of any state or
federal court in the county or judicial district where the Bank’s office indicated above is
located; provided that nothing contained in this Note will prevent the Bank from bringing any
action, enforcing any award or judgment or exercising any rights against the Borrower
individually, against any security or against any property of the Borrower within any other
county, state or other foreign or domestic jurisdiction. The Borrower acknowledges and agrees that
the venue provided above is the most convenient forum for both the Bank and the Borrower. The
Borrower waives any objection to venue and any objection based on a more convenient forum in any
action instituted under this Note.

15. Commercial Purpose. The Borrower represents that the indebtedness evidenced by this
Note is being incurred by the Borrower solely for the purpose of acquiring or carrying on a
business, professional or commercial activity, and not for personal, family or household purposes.

16. WAIVER OF JURY TRIAL.
The borrower irrevocably waives any and all rights the borrower
may have to a trial by jury in any action, proceeding or claim of any nature relating to this
note, any documents executed in connection with this note or any transaction
contemplated in any of such documents. The borrower acknowledges that the foregoing waiver is
knowing and voluntary.

The Borrower acknowledges that it has read and understood all the provisions of this Note,
including the waiver of jury trial, and has been advised by counsel as necessary or appropriate.

WITNESS the due execution hereof as a document under seal, as of the date first written above,
with the intent to be legally bound hereby.

	 	 	 	 	 	 	 	 	 	 	 
	WITNESS / ATTEST:	 	ERIE INDEMNITY COMPANY	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	/s/ Donald A. McRae	 	By:	 	/s/ Douglas F. Ziegler	 	 
	Print Name:	 	Donald A. McRae	 	 	 	Print Name:	 	Douglas F. Ziegler	 	 
	Title:

	 	AVP	 	 	 	Title:	 	SUP TREASURER & CIO	 	 
	(Include
title
only if an
officer of
entity
signing
to the right)
	 	 	 	 	 

-7-exv10w3

Exhibit 10.3

Notification and Control Agreement

(Trust, Custody or Brokerage Accounts)

     THIS NOTIFICATION AND CONTROL AGREEMENT (the “Agreement”) is made this 30th day of
January, 2008, by and among ERIE INDEMNITY COMPANY (the “Pledgor”), MELLON BANK, N.A., in its
capacity as custodian (the “Custodian”) and PNC BANK, NATIONAL ASSOCIATION, with an office at 901
State Street, P.O. Box 8480, Erie, Pennsylvania 16553, in its capacity as secured party (the
“Secured Party”).

     The Pledgor has granted to the Secured Party a security interest in certain of the investment
property held in its securities account No. EIRF 2221002 maintained with the Custodian (the
“Account”), all financial assets now or hereafter credited to the Account, and all additions,
substitutions, replacements, proceeds, income, dividends and distributions thereon (collectively,
the “Collateral”), pursuant to, and more particularly described in, an Amended and Restated Pledge
Agreement dated as of even date herewith (as amended, restated or otherwise modified from time to
time, the “Pledge Agreement”) from the Pledgor to the Secured Party. The Custodian is in
possession of the Collateral pursuant to a certain Custody Agreement dated February 25, 2004 (the
“Custodian Agreement”). Pursuant to the Pledge Agreement, the Secured Party has required the
execution and delivery of this Agreement.

     NOW, THEREFORE, for valuable consideration and intending to be legally bound, the parties
hereto agree and acknowledge as follows:

     1. Possession of Collateral. The Custodian acknowledges that: (a) the Collateral is
in its possession or in possession of a subcustodian or clearing corporation, and (b) the Pledgor’s
interest in the Collateral appears on the Custodian’s books and records. The Custodian will treat
all property deposited or credited to the Account as financial assets under Article 8 of the
Uniform Commercial Code (as adopted and enacted and in effect from time to time in the State where
the Secured Party’s office indicated above is located) (“UCC”).

     2. Notice of Security Interest. The Custodian acknowledges that this Agreement
constitutes written notification to the Custodian, pursuant to Articles 8 and 9 of the UCC and
applicable federal regulations for the Federal Reserve Book Entry System, of the Secured Party’s
security interest in the Collateral. The Pledgor, Secured Party and Custodian are also entering
into this Agreement to provide for the Secured Party’s control of the Collateral and to perfect,
and confirm the priority of, the Secured Party’s security interest in the Collateral. The
Custodian agrees to promptly make all necessary entries or notations in its books and records to
reflect the Secured Party’s security interest in the Collateral. Notwithstanding the foregoing,
the Custodian makes no representation or warranty, and shall have no responsibility or liability,
with respect to the effectiveness of this Agreement in perfecting such security interest.

     3. Control. The Custodian, without further consent from the Pledgor,
hereby agrees to comply with
all entitlement orders, instructions, and directions of any kind originated by Secured Party
concerning the Collateral, to liquidate the Collateral as and to the extent directed by the Secured
Party and to pay over to the Secured Party all proceeds therefrom to the extent necessary to
satisfy the Pledgor’s obligations, without any setoff or deduction.

     4. Trading and Withdrawals. Prior to receipt by the Custodian of a notice from the
Secured Party that the Secured Party is exercising exclusive control over the Collateral (a “Notice
of Exclusive Control”), the Pledgor shall have the right at any time and from time to time to
purchase and sell securities included in the Collateral and receive for its own account all cash
dividends and interest on the Collateral, provided that the Custodian retains all the Collateral
including substitutions and proceeds from the sale of securities in the Account. The Custodian
will not comply with any entitlement order originated by the Pledgor that would require the
Custodian to make a free delivery to the Pledgor or any other person. Upon the Custodian’s receipt
of a Notice of Exclusive Control, Custodian will, after having had a reasonable opportunity to act
upon such notice, cease (a) complying with entitlement orders or other directions concerning the
Collateral originated by the Pledgor, and (b) if directed by the Secured Party, distributing
interest and dividends on the Collateral to the Pledgor.

-2-

 

     5. Custodian Agreement. The Custodian shall simultaneously send to the Secured Party
copies of all notices given and monthly statements rendered pursuant to the Custodian Agreement and
shall notify the Secured Party of the termination of the Custodian Agreement. Notwithstanding
anything contained in the Custodian Agreement, so long as this Agreement remains in effect, neither
the Pledgor nor the Custodian shall terminate the Custodian Agreement without thirty (30) days’
prior written notice to the other party and the Secured Party. In the event of any conflict
between the provisions of this Agreement and the Custodian Agreement, the provisions hereof shall
control. Regardless of any provision in the Custodian Agreement, the State where the Secured
Party’s office indicated above is located shall be deemed to be the Custodian’s jurisdiction solely
for the purposes of this Agreement and the perfection and priority of the Secured Party’s security
interest in the Collateral. In the event the Custodian no longer serves as custodian for the
Collateral, the Collateral shall be transferred (i) to a successor custodian satisfactory to the
Secured Party, provided that prior to such transfer, such successor custodian executes an agreement
that is in all material respects the same as this Agreement, or (ii) if no satisfactory successor
has been designated, then as directed by the Secured Party.

     6. Indemnity.

     (a) The Pledgor shall indemnify and hold the Custodian harmless from any and all losses,
claims, damages, liabilities, expenses and fees, including reasonable attorneys’ fees, resulting
from the execution of or performance under this Agreement and the delivery by the Custodian of all
or any part of the Collateral to the Secured Party pursuant to this Agreement, unless such losses,
claims, damages, liabilities, expenses or fees are attributable to the Custodian’s gross
negligence or willful misconduct. This indemnification shall survive the termination of this
Agreement.

     (b) The Secured Party shall indemnify and hold the Custodian harmless from and against any and
all losses, claims, damages, liabilities, expenses and fees (including reasonable attorneys’ fees)
arising out of the Custodian’s compliance with any instructions from the Secured Party with respect
to the Collateral unless such losses, claims, damages, liabilities, expenses or fees are
attributable to the Custodian’s gross negligence or willful misconduct. This indemnification shall
survive the termination of this Agreement.

     7. Protection of Custodian. Except as required by Paragraph 3 hereof, the Custodian
shall have no duty to require any cash or securities to be delivered to it or to determine that the
amount, value and form of assets constituting Collateral comply with any applicable requirements.
The Custodian may hold the securities in bearer, nominee, federal reserve book entry, or other form
and in any securities depository or UCC clearing corporation, with or without indicating that the
securities are subject to a security interest; provided, however, that all
Collateral shall be identified on the Custodian’s books and records as subject to the Secured
Party’s security interests and shall be in a form that permits transfer to the Secured Party
without additional authorization or consent of the Pledgor. The Custodian may rely and shall be
protected in acting upon any notice, instruction, or other communication which it reasonably
believes to be genuine and authorized. As between the Pledgor and the Custodian, the terms of the
Custodian Agreement shall apply with respect to any losses or liabilities or fees, costs or
expenses of such parties arising out of matters covered by this Agreement. The Custodian shall
have no responsibility or liability to the Secured Party for making trades of financial assets held
in the Account at the direction of the Pledgor, or the Pledgor’s authorized representatives, or
(except as otherwise provided in Paragraph 4 hereof) complying with entitlement orders concerning
the Account from the Pledgor, or the Pledgor’s authorized representatives, that are received by the
Custodian before the Custodian receives a Notification of Exclusive Control. The Custodian shall
have no duty to investigate or make any determination as to whether a default exists under any
agreement between the Pledgor and the Secured Party and shall comply with a Notice of Exclusive
Control even if it believes that no such default exists. The Pledgor agrees that the Custodian
will not be liable to the Pledgor for complying with entitlement orders originated by the Secured
Party, unless the Custodian (i) takes the action after it is served with an injunction or other
legal process enjoining it from doing so issued by a court of competent jurisdiction and has had a
reasonable opportunity to act on the injunction or other legal process, or (ii) acts in collusion
with the Secured Party in violating the Pledgor’s rights. The Custodian shall have no liability to
any party for any incidental, punitive or consequential damages resulting from any breach by the
Custodian of its obligations hereunder.

-3-

 

     The Custodian will be excused from failing to act or delay in acting, and no such failure or
delay shall constitute a breach of this Agreement or otherwise give rise to any liability of the
Custodian, if (i) such failure or delay is caused by circumstances beyond the Custodian’s
reasonable control, including but not limited to legal constraint, emergency conditions, action or
inaction of governmental, civil or military authority, fire, strike, lockout or other labor
dispute, war, riot, theft, flood, earthquake or other natural disaster, breakdown of public or
private or common carrier communications or transmission facilities or equipment failure, or (ii)
such failure or delay resulted from the Custodian’s reasonable belief that the action would have
violated any guideline, rule or regulation of any governmental authority.

     8. Termination/Release of Collateral. This Agreement shall terminate automatically
upon receipt by the Custodian of written notice executed by two officers of the Secured Party
holding titles of Vice President or higher that (a) all of the obligations secured by Collateral
have been satisfied, or (b) all of the Collateral may be released, whichever is sooner, and the
Custodian shall thereafter be relieved of all duties and obligations hereunder. In addition, any
notice from the Secured Party relating to release of all or any portion of the Collateral not
permitted by this Agreement without the consent of the Secured Party shall be effective only if
executed by two officers of the Secured Party holding titles of Vice President or higher.

     9. Waiver and Subordination of Rights. The Custodian hereby waives its right to
setoff any obligations of the Pledgor to the Custodian against any or all cash, securities,
financial assets and other investment property held by the Custodian as Collateral, and hereby
subordinates in favor of the Secured Party any and all liens, encumbrances, claims or security
interests which the Custodian may have against the Collateral, either now or in the future, except
that the Custodian will retain its prior lien on the property held as Collateral only to secure
payment for property purchased for Collateral and normal commissions and fees, including overdraft
fees, relating to the property held as Collateral. The Custodian will not agree with any third
party that the Custodian will comply (and the Custodian will not comply) with any entitlement
orders, instructions or directions of any kind concerning the Collateral originated by such third
party without the Secured Party’s prior written consent. Except for the claims and interests of
the Secured Party and the Pledgor in the Collateral, the Custodian does not know of any claim to or
interest in the Collateral. The Custodian will use reasonable efforts to promptly notify the
Secured Party and the Pledgor if any other person claims that it has a property interest in any of
the Collateral.

     10. Expenses. The Pledgor shall pay all fees, costs and expenses (including
reasonable fees and expenses of internal or external counsel) of enforcing any of the Secured
Party’s rights and remedies upon any breach (by the Custodian or the Pledgor) of any of the
provisions of this Agreement.

     11. Notices. All notices, demands, requests, consents, approvals and other
communications required or permitted hereunder (“Notices”) must be in writing and will be effective
upon receipt. Notices may be given in any manner to which the parties may separately agree,
including electronic mail. Without limiting the foregoing, first-class mail, facsimile
transmission and commercial courier service are hereby agreed to as acceptable methods for giving
Notices. Regardless of the manner in which provided, Notices may be sent to a party’s address as
set forth below, or to such other address as any party may give to the others for such purpose in
accordance with this section.

     12. Changes in Writing. No modification, amendment or waiver of, or consent to any
departure by any party from, any provision of this Agreement will be effective unless made in a
writing signed by the parties hereto, and then such waiver or consent shall be effective only in
the specific instance and for the purpose for which given. No notice to or demand on the Pledgor
in any case will entitle the Pledgor to any other or further notice or demand in the same, similar
or other circumstance.

     13. Entire Agreement. This Agreement (including the documents and instruments
referred to herein) constitutes the entire agreement and supersedes all other prior agreements and
understandings, both written and oral, among the parties with respect to the subject matter hereof.

-4-

 

     14. Counterparts. This Agreement may be signed in any number of counterpart copies
and by the parties
hereto on separate counterparts, but all such copies shall constitute one and the same instrument.
Delivery of an executed counterpart of a signature page to this Agreement by facsimile transmission
shall be effective as delivery of a manually executed counterpart. Any party so executing this
Agreement by facsimile transmission shall promptly deliver a manually executed counterpart,
provided that any failure to do so shall not affect the validity of the counterpart executed by
facsimile transmission.

     15. Successors and Assigns. This Agreement will be binding upon and inure to the
benefit of the parties hereto and their respective heirs, executors, administrators, successors and
assigns; provided, however, that the Pledgor may not assign this Agreement in whole
or in part without the Secured Party’s prior written consent and the Secured Party at any time may
assign this Agreement in whole or in part.

     16. Governing Law and Jurisdiction. This Agreement has been delivered to and accepted
by the Secured Party and will be deemed to be made in the State where the Secured Party’s office
indicated above is located. This Agreement will be interpreted and the rights and liabilities
of the parties hereto determined in accordance with the laws of the State where the Secured Party’s
office indicated above is located, excluding its conflict of laws rules. Each of the parties
hereby irrevocably consents to the exclusive jurisdiction and venue of any state or federal court
located within the county where the Secured Party’s office indicated above is located.

     17. Representations. Each party hereby represents and warrants that the individual
executing this Agreement on its behalf has the requisite power and authority to do so and to bind
it to the terms of this Agreement.

     18. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES ANY AND ALL
RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR CLAIM OF ANY NATURE RELATING TO
THIS AGREEMENT, ANY DOCUMENTS EXECUTED IN CONNECTION WITH THIS AGREEMENT OR ANY TRANSACTION
CONTEMPLATED IN ANY OF SUCH DOCUMENTS. EACH PARTY HERETO ACKNOWLEDGES THAT THE FOREGOING WAIVER IS
KNOWING AND VOLUNTARY.

{SIGNATURES APPEAR ON THE FOLLOWING PAGE}

-5-

 

     WITNESS the due execution hereof as a document under seal, as of the date first written above.

	 	 	 	 	 	 	 
	Pledgor’s Address for Notices:	 	PLEDGOR:	 	 
	 
	 	 	 	 	 	 
	100 Erie Insurance Place 

Erie, PA 16530	 	ERIE INDEMNITY COMPANY	 	 
	Attention:
                    
                    
                    

	 	By:
	 	/s/ Philip A. Garcia	 	 
	 

	 	 	 	 	 	 
	Facsimile Number
               
                    
            

	 	 	 	Print Name: Philip A. Garcia

Title:  Executive Vice President & CFO
	 	 

	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	Secured Party’s Address for Notices:	 	SECURED PARTY:	 	 
	 
	 	 	 	 	 	 
	901 State Street	 	PNC BANK, NATIONAL ASSOCIATION	 	 
	P.O. Box 8480
	 	 	 	 	 	 
	Erie, PA 16553
	 	 	 	 	 	 
	Attention: James F. Stevenson, Vice President

	 	By:
	 	/s/ James F. Stevenson
	 	 
	 

	 	 	 	 	 	 
	Facsimile Number: (814) 871-9432

	 	 	 	James F. Stevenson	 	 
	 

	 	 	 	Vice President	 	 

	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	Custodian’s Address for Notices:	 	CUSTODIAN:	 	 
	 
	 	 	 	 	 	 
	One Mellon Center	 	MELLON BANK, N.A.	 	 
	Pittsburgh, PA 15258
	 	 	 	 	 	 
	Attention: Julie Bour

	 	By:
	 	/s/ Julie Bour	 	 
	 

	 	 	 	 	 	 
	Facsimile Number 412-234-8725

	 	 	 	Print Name: Julie Bour
	 	 
	 

	 	 	 	Title:  Vice President	 	 

-6-

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