Document:

EX-10.1

	 	 	 	 	 	 	 
	BANK OF

AMERICA, N.A.

	 	

WACHOVIA BANK, NATIONAL ASSOCIATION
	 	

RBC BANK (USA)
	 	

SUNTRUST BANK

THIRD AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

This THIRD AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT (“Agreement”) is entered into as
of the 2nd day of May, 2008, by and among BANK OF AMERICA, N.A., WACHOVIA BANK, NATIONAL
ASSOCIATION, RBC BANK (USA) (formerly known as RBC CENTURA BANK), SUNTRUST BANK and PORTFOLIO
RECOVERY ASSOCIATES, INC., a Delaware corporation (“Borrower”).

RECITALS

Borrower, Bank of America, N.A. (“BOA”), Wachovia Bank, National Association (“Wachovia”) and
RBC Centura Bank (now known as RBC Bank (USA)) (“RBC”) entered into a Second Amended and Restated
Loan and Security Agreement on May 4, 2007, which was amended by a Loan Document Modification
Agreement dated October 26, 2007 and by a Second Loan Document Modification Agreement dated March
18, 2008 and the parties thereto now desire to add SunTrust Bank (“SunTrust”) as a party thereto as
one of the “Banks”, and by becoming a party hereto as one of the Banks, SunTrust will pay to each
of BOA, Wachovia and RBC an amount equal to their respective Borrowing Percentages of SunTrust’s
Borrowing Percentage of amounts outstanding hereunder as of the date of execution of this
Agreement. In addition to adding SunTrust as a Bank, the parties hereto desire to increase the
Revolving Facility and modify certain terms. Borrower wishes to continue to obtain credit from
time to time from the Banks, and the Banks desire to extend credit to Borrower for use by Borrower
in its business. This Agreement sets forth the terms and conditions on which the Banks will
advance credit to Borrower.

AGREEMENT

The parties agree as follows:

1. DEFINITIONS AND INTERPRETATION.

1.1 Definitions. Capitalized terms used herein and not defined in the specific
section in which they are used shall have the meanings assigned to such terms in . Terms not
defined in a specific section or in Exhibit A which are defined in the Code shall have the
meanings assigned to such terms in the Code.

1.2 Accounting Terms. All accounting terms not specifically defined in shall be
construed in accordance with GAAP and all calculations shall be made in accordance with GAAP. The
term “financial statements” shall include the accompanying notes and schedules.

1.3 Use and Application of Terms. To the end of achieving the full realization by the
Banks of their rights and remedies under this Agreement, including payment in full of the
Obligations, in using and applying the various terms, provisions and conditions in this Agreement,
the following shall apply: (i) the terms “hereby”, “hereof”, “herein”, “hereunder” and any similar
words refer to this Agreement; (ii) words in the masculine gender mean and include correlative
words of the feminine and neuter genders and words importing the singular numbered meaning include
the plural number, and vice versa; (iii) words importing persons include firms, companies,
associations, general partnerships, limited partnerships, limited liability partnerships, limited
liability limited partnerships, limited liability companies, trusts, business trusts, corporations
and other registered or legal organizations, including public and quasi-public bodies, as well as
individuals; (iv) the use of the terms “including” or “included in”, or the use of examples
generally, are not intended to be limiting, but shall mean, without limitation, the examples
provided and others that are not listed, whether similar or dissimilar; (v) the phrase “costs and
expenses”, or variations thereof, shall include, without limitation, the reasonable fees of the
following persons: attorneys, legal assistants, accountants, engineers, surveyors, appraisers and
other professionals and service providers; (vi) as the context requires, the word “and” may have a
joint meaning or a several meaning and the word “or” may have an inclusive meaning or an exclusive
meaning; (vii) this Agreement shall not be applied, interpreted and construed more strictly against
a person because that person or that person’s attorney drafted this Agreement; and (viii) wherever
possible each provision of this Agreement and the other Loan Documents shall be interpreted and
applied in such manner as to be effective and valid under applicable Requirements of Law, but if
any provision of this Agreement or any of the other Loan Documents shall be prohibited or invalid
under such law, or the application thereof shall be prohibited or invalid under such law, such
provision shall be ineffective to the extent of such prohibition or invalidity without invalidating
the remainder of such provision or the remaining provisions, or the application thereof shall be in
a manner and to an extent permissible under applicable Requirements of Law.

2. CREDIT EXTENSIONS.

2.1 (a) Credit Extensions. Subject to and upon the terms and conditions of this
Agreement and provided that no Event of Default has occurred and is continuing, the Banks shall
make available to Borrower the Revolving Facility with a non-revolving sublimit and Credit
Extensions thereunder generally described as follows: a revolving line of credit in an amount equal
to Three Hundred Forty Million Dollars ($340,000,000) (the “Revolving Facility”) with a One Hundred
Million Dollar ($100,000,000) sublimit for non-revolving fixed rate advances (the “Non-Revolving
Sublimit”) provided, however, in no event shall the aggregate amount outstanding under the
Revolving Facility and the Non-Revolving Sublimit ever exceed thirty percent (30%) of Borrower’s
and Portfolio Recovery Associates, L.L.C.’s Estimated Remaining Collections of all Eligible Asset
Pools. The Revolving Facility and the Non-Revolving Sublimit and related Credit Extensions which
are to be made available to Borrower are more fully described below in this Section 2.1 and unless
otherwise provided in this Agreement, the Revolving Facility and the Non-Revolving Sublimit and
related Credit Extensions shall be evidenced by one or more Promissory Notes from Borrower to the
Banks and the Credit Extensions shall bear interest, and the Credit Extensions, the interest and
the fees, charges, premiums and costs and expenses associated therewith, shall be repayable in
accordance with the terms of such Promissory Notes and this Agreement.

(b) Revolving Facility. At any time from the date hereof through the Revolver
Maturity Date, Borrower may request and the Banks agree to make Advances under the Revolving
Facility to Borrower to finance (i) working capital needs for its business, (ii) payments of
dividends, (iii) repurchases of capital stock of Portfolio Recovery Associates, Inc., and (iv)
acquisitions permitted by Section 7.3 – and not for any other purpose. The aggregate amount of
outstanding Advances under the Revolving Facility shall not exceed at any time the Committed Line
less Advances made under the Non-Revolving Sublimit. If no Event of Default has occurred and is
continuing, amounts borrowed under the Revolving Facility may be repaid and reborrowed at any time
prior to the Revolver Maturity Date.

(c) Non-Revolving Sublimit. At any time from the date hereof through the Revolver
Maturity Date, Advances up to the amount of the Non-Revolving Sublimit, each in integral increments
of Ten Million Dollars($10,000,000), shall be available to be advanced to Borrower on a
non-revolving basis, and the proceeds of Advances under the Non-Revolving Sublimit shall be used by
Borrower to finance (i) working capital needs for its business, (ii) payment of dividends, (iii)
repurchases of capital stock of Portfolio Recovery Associates, Inc., and (iv) acquisitions
permitted by Section 7.3, and not for any other purpose. Advances made under the Non-Revolving
Sublimit shall reduce availability under the Revolving Facility. Borrower may also convert amounts
outstanding under the Revolving Facility to Advances under the Non-Revolving Sublimit by giving
written notice of such conversion to each Bank. Such conversions may only be made in integral
increments of Ten Million Dollars ($10,000,000). If no Event of Default has occurred and is
continuing, each Advance made under the Non-Revolving Sublimit and all amounts owed in connection
therewith shall be repaid on or before the Non-Revolving Maturity Date for such Advance.

2.2 Credit Extensions – Disbursements. (a) Whenever Borrower desires an Advance,
Borrower shall notify each Bank by facsimile transmission or telephone no later than 10:00 a.m.
eastern time, on the Business Day on which Borrower desires the Advance to be made. Each
notification by facsimile transmission shall include the information requested on the form attached
as Exhibit B, shall be submitted substantially in the form of Exhibit B and shall
be signed by a Responsible Officer or a designee thereof. Each notification by telephone shall
include the information requested on the form attached as Exhibit B and each notification
by telephone shall be followed within one Business Day by a facsimile transmission which meets the
criteria regarding a facsimile transmission. Each Bank shall be entitled to rely on any telephonic
notice given by a person who such Bank reasonably believes to be a Responsible Officer or a
designee thereof. No Bank shall have any liability to Borrower or any other person for its failure
to make an Advance on the date requested by Borrower, unless such failure is the result of willful
misconduct or gross negligence of such Bank; and if such Bank’s failure is a result of willful
misconduct or gross negligence, its liability shall be limited to actual damages only – no Bank
shall be liable for indirect, speculative, consequential or punitive damages and losses. Where
Borrower maintains its operating deposit account with a Bank, such Bank will credit the amount of
the Advances made by such Bank to such account.

(b) Borrower shall use its best efforts to ensure that each request for an Advance is made of
all Banks, in accordance with each Bank’s Borrowing Percentage at the time, and all payments and
pre-payments to the Banks shall be made Pro Rata.

2.3 Overadvances. If, at any time, the aggregate amount of the outstanding principal
under the Revolving Facility and the Non-Revolving Sublimit exceeds the Committed Line, the
Borrower shall immediately pay to each Bank, in cash, its Pro Rata portion of such excess.

2.4 Charging of Payments. A Bank may, after the occurrence of an Event of Default, at
its option, set-off and apply to the Obligations and otherwise exercise its rights of recoupment as
to any and all (i) balances and deposits of Borrower held by such Bank, (ii) indebtedness and other
obligations at any time owing to or for the credit or the account of Borrower by such Bank and by
any of such Bank’s Affiliates. A Bank may, after notice to Borrower at its option, also charge all
payments required to be made on any of the Obligations against the Revolving Facility. If a Bank
charges the aforementioned payments against the Revolving Facility, the same shall be deemed an
Advance thereunder and the amount of the Advance shall thereafter accrue interest at the interest
rate applicable from time to time to Advances; and if a Bank charges payments as aforesaid, such
Bank may, in its discretion, limit, declare a moratorium on and terminate Borrower’s right under
this Agreement to receive additional Advances, after notice to Borrower and each other Bank, and a
Bank’s decision to do one of the foregoing does not prevent it from later doing any one or more of
the others.

2.5 Fees. In addition to the other fees, charges, costs and expenses required to be
paid by Borrower under this Agreement and the other Loan Documents, Borrower shall pay to the Banks
the fees, charges, costs and expenses set forth in this Section 2.5.

(a) Unused Facility Fee. Borrower shall pay to each Bank an annualized three-tenths
of one percent (0.30%) Unused Facility Fee, which shall be payable monthly on the first day of each
month, and which shall be based upon the average amount of the Unused Facility for the preceding
calendar month for each Bank relative to each such Bank’s Commitment. The average amount of the
Unused Facility for any partial month shall be calculated based on the unused amounts in such
partial month.

(b) Bank Expenses. On the Closing Date, Borrower shall pay to the Banks all
reasonable Bank Expenses incurred through the Closing Date and shall pay, as and when demand is so
made by a Bank to Borrower, all reasonable Bank Expenses incurred relating to completion, after the
Closing Date, of matters related to closing of this Agreement. Borrower shall be responsible for
its own fees and expenses, including its legal fees.

(c) Renewal Fee. On the Closing Date, Borrower shall pay to each Bank a renewal fee
in the amount of six (6) basis points of its Commitment.

2.6 Documentary and Intangible Taxes; Additional Costs. To the extent not prohibited
by law and notwithstanding who is liable for payment of the taxes and fees, Borrower shall pay, on
a Bank’s demand, all intangible personal property taxes, documentary stamp taxes, excise taxes and
other similar taxes assessed, charged and required to be paid in connection with the Credit
Extensions and any extension, renewal and modification thereof, or assessed, charged and required
to be paid in connection with this Agreement, any of the other Loan Documents and any extension,
renewal and modification of any of the foregoing. If, with respect to this Agreement or the
transactions hereunder, any Requirement of Law (i) subjects a Bank to any tax (except federal,
state and local income taxes on the overall net income of a Bank), (ii) imposes, modifies and deems
applicable any deposit insurance, reserve, special deposit or similar requirement against assets
held by, or deposits in, or loans by a Bank, or (iii) imposes upon a Bank any other condition, and
the result of any of the foregoing is to increase the cost to such Bank, reduce the income
receivable by such Bank or impose any expense upon such Bank with respect to the Obligations,
Borrower agrees to pay to such Bank the amount of such increase in cost, reduction in income or
additional expense within thirty (30) days following presentation by such Bank of a statement of
the amount and setting forth such Bank’s calculation thereof, all in reasonable detail, which
statement shall be deemed true and correct absent manifest error.

2.7 Term of Agreement. This Agreement shall become effective on the Closing Date and
shall continue in full force and effect until the payment in full of all of the Obligations.
Notwithstanding the foregoing, each Bank shall have the right to limit, declare a moratorium on and
terminate its obligation to make Credit Extensions under this Agreement immediately and without
notice to Borrower (but with immediate written notice to each other Bank) upon the occurrence and
during the continuance of an Event of Default; and such action by a Bank shall not constitute a
termination of this Agreement, shall not constitute a termination of Borrower’s obligations under
this Agreement or the other Loan Documents and shall not adversely affect or impair any Bank’s
security interests in the Collateral. A Bank’s decision to do any one of the foregoing (i.e.,
limit, declare a moratorium and terminate its obligations to make Credit Extensions) shall not
prevent it from exercising any one or more of the other options available to it at any other time.
The Banks shall review the Revolver Maturity Date annually, and shall notify Borrower (pursuant to
a notice substantially in the form of the Notice of Extension attached hereto) not less than sixty
(60) days before each anniversary of this Agreement only if they intend to extend the Revolver
Maturity Date to a date which is one year beyond the then current Revolver Maturity Date.

3. CONDITIONS OF CREDIT EXTENSIONS.

3.1 Conditions Precedent to Initial Credit Extension. The obligation of any Bank to
make the initial Credit Extension is subject to the condition precedent that all of the conditions
and requirements set forth in this Section 3.1 and Section 3.2 have been satisfied and completed,
or the satisfaction and completion thereof waived by the Banks. If all of the conditions are not
met to all Banks’ satisfaction, or the completion thereof waived by each Bank, each Bank may, at
its option, (i) withhold disbursement until the same are met, (ii) close and require that any
unsatisfied conditions be satisfied as a condition subsequent to closing within such period of time
as may be designated by such Bank or (iii) terminate its obligation to make any Credit Extension
and recover from Borrower all Bank Expenses incurred by such Bank in connection with its
preparations for making the Credit Extensions, together with the fees and other costs and expenses
required to be paid by Borrower under the Commitment. A waiver by the Banks of a condition must be
in writing to be effective and a waiver as to one or more conditions shall not constitute a waiver
as to other conditions and shall not establish a “course of dealing or practice” that would require
a waiver of the same or a similar condition at some later time. A waiver shall not be deemed
effective against the rights of a Bank unless expressly given by such Bank.

(a) Loan Documents, etc. Each Bank shall have received an original of this Agreement,
duly executed by Borrower and any other persons who are parties hereto, and all of the information,
certifications, certificates, authorizations, consents, approvals, title and other insurance
policies and commitments, financial statements, financing statements, agreements, documents and
records as the Banks and their counsel may deem reasonably necessary or appropriate.

(b) Payment of Fees. Each Bank shall have received payment of the fees and Bank
Expenses then due, as specified in Section 2.

(c) No Event of Default. No Event of Default shall have occurred and be continuing as
of the Closing Date, or after giving effect to the initial Credit Extension to be made at or
immediately after closing.

(d) Additional Matters. All other legal and non-legal matters as any Bank or its
counsel deems reasonably necessary or appropriate to be satisfied, completed and received prior to
the initial Credit Extension shall be satisfied, completed and received in form and substance
satisfactory to such Bank and its counsel; and the Bank’s counsel shall have received duly executed
counterpart originals, or certified or other such copies of all records as such counsel may
reasonably request.

3.2 Conditions Precedent to All Credit Extensions. The obligation of any Bank to make
each Credit Extension, including the initial Credit Extension, is further subject to all of the
conditions and requirements set forth in this Section 3.2 being satisfied and completed, or the
satisfaction and completion thereof waived by each Bank.

(a) Loan Payment/Advance Request Form. Each Bank shall have received, as and when
required, a completed Loan Payment/Advance Request Form in the form of Exhibit B attached
hereto.

(b) Representations and Warranties; No Event of Default. The representations and
warranties referenced in Section 5 and in the other Loan Documents shall be true and correct on and
as of the date of such Loan Payment/Advance Request Form and on the effective date of each Credit
Extension as though made at and as of each such date, and no Event of Default shall have occurred
and be continuing, or would exist after giving effect to such Credit Extension (provided, however,
that those representations and warranties expressly referring to another date shall be true,
correct and complete as of such date). The making of each Credit Extension shall be deemed to be a
representation and warranty by Borrower on the date of such Credit Extension as to the accuracy of
the facts referred to in this subsection.

(c) Audit of Collateral. At any Bank’s election, such Bank shall have received from
Borrower an internally prepared report of the Collateral (including, without limitation, Borrower’s
and Portfolio Recovery Associates, L.L.C.’s Asset Pools), in a format consistent with the form
included in Borrower’s quarterly and annual public filings. In the event Borrower’s accountants
make material corrections or modifications to the report presented to them for review, Borrower
shall immediately inform each Bank of such corrections or modifications.

4. CREATION OF SECURITY INTEREST.

4.1 Grant of Security Interest. Borrower grants and pledges to the Banks a continuing
security interest in all presently existing and hereafter acquired or arising Collateral to secure
the prompt repayment of any and all Obligations and to secure the prompt performance by Borrower of
each of its covenants, duties and obligations under the Loan Documents. Except as set forth in the
Schedule, such security interest constitutes a valid, first priority security interest in the
presently existing Collateral, and will constitute a valid, first priority security interest in
Collateral acquired or arising after the date hereof. Notwithstanding any limitation of,
moratorium on or termination of any Bank’s obligation to make Credit Extensions under this
Agreement, the Banks’ security interest on the Collateral shall remain in full force and effect for
so long as any Obligations are outstanding.

4.2 Delivery of Additional Documentation Required. (a) To the extent that such
documentation is physically available to Borrower; Borrower shall from time to time execute and
deliver to any Bank, at the request of such Bank, all Negotiable Collateral, all Financing
Statements and other documents and records that such Bank may request, in form and substance
satisfactory to such Bank and its counsel, to perfect and continue perfected such Bank’s security
interests in the Collateral and in order to fully consummate all of the transactions contemplated
under the Loan Documents. Borrower hereby consents to the filing by any Bank of Financing
Statements and such other instruments and documents in any jurisdictions or locations deemed
advisable or necessary in such Bank’s discretion to preserve, protect and perfect such Bank’s
security interest and rights in the Collateral. Borrower further consents to and ratifies the
filing of such Financing Statements and other instruments and documents prior to the Closing Date.
If Borrower has executed and delivered to any Bank a separate security agreement or agreements in
connection with any or all of the Obligations, that security agreement or those security agreements
and the security interests created therein shall be in addition to and not in substitution of this
Agreement and the security interests created hereby, and this Agreement shall be in addition to and
not in substitution of the other security agreement or agreements and the security interests
created thereby, but shall be subject at all times to the Intercreditor Agreement. In all cases
this Agreement and the aforesaid security agreement or agreements, as well as all other evidences
or records of any and all of the Obligations and agreements of Borrower, the Banks and other
persons who may be obligated on any of the Obligations, shall be applied and enforced in harmony
with and in conjunction with each other to the end that each Bank realizes fully upon its rights
and remedies in each and the Liens created by each; and, to the extent conflicts exist between this
Agreement and the other security agreements and records, they shall be resolved in favor of the
Banks for the purpose of achieving the full realization of the Banks’ collective rights and
remedies thereunder and the Liens as aforesaid.

(b) Borrower shall take reasonable steps to provide that computer or other records
representing or evidencing an Account contain (by way of stamp, legend or other method satisfactory
to the Banks) the following language: “Pledged to Bank of America, Wachovia Bank, RBC Bank (USA)
and SunTrust Bank as Collateral” or such other language as the Banks may from time to time require.
After an Event of Default, if requested by any Bank, all contracts, documents, instruments and
chattel paper evidencing an Account shall contain (by way of stamp, legend or other method
satisfactory to such Bank) the above quoted language. Failure to deliver physical possession of
any instruments, documents, or writings in respect of any Account to any Bank, or all of them,
shall not invalidate any such Bank’s security interest therein. To the extent that possession may
be required by applicable law for perfection of a Bank’s security interest, the original chattel
paper and instruments representing the Accounts (to the extent available) shall be deemed to be
held by such Bank, although kept by Borrower or Guarantor as the custodial agent of such Bank(s).
Borrower or Guarantor (as the case may be) shall, at any reasonable time and at Borrower’s or
Guarantor’s own expense, upon any Bank’s reasonable request, physically deliver to such Bank on
computer disk or other electronic data storage means which shall be machine readable in Microsoft
Access or such other form as mutually agreed upon by the parties hereto, copies of all Accounts
(including any instruments, documents or writings in respect of any Account together with all other
instruments, documents or writings in respect of any collateral securing each Account, then in
Borrower’s or Guarantor’s control) assigned to a Bank to any reasonable place or places designated
by such Bank. All Accounts shall, regardless of their location, be deemed to be under the Banks’
dominion and control (with both paper and computer files so labeled) and deemed to be in the Bank
or Banks’, as applicable, possession.).

(c) A copy of any notice or request by any Bank pursuant to this Section 4.2, and any response
or information provided by Borrower to any Bank pursuant to this Section 4.2, shall be delivered to
all other Banks simultaneously.

4.3 Power of Attorney. Borrower does hereby irrevocably constitute and appoint each
Bank, or any of them, its true and lawful attorney with full power of substitution, for it and in
its name, place and stead, to execute, deliver and file such agreements, documents, notices,
statements and records, to include, without limitation, Financing Statements, and to do or
undertake such other acts as any such Bank, after notice to Borrower and each other Bank, and after
providing a copy of any such item to Borrower in its sole discretion, deems necessary or advisable
to effect the terms and conditions of this Agreement, the other Loan Documents and to otherwise
preserve, protect and perfect the security of the security interest in the Collateral. The
foregoing appointment is and the same shall be coupled with an interest in favor of the Banks.
Notwithstanding the foregoing present grant of a power of attorney by Borrower to the Banks, except
as otherwise provided in this Agreement and except with respect to filing of Financing Statements
and other actions any Bank deems necessary or appropriate to preserve, protect, and perfect or
continue the perfection of its security interests in the Collateral, no Bank shall exercise the
rights granted to it under this Section 4.3 until after the occurrence of an Event of Default, or
the occurrence of an event which, upon the giving of any required notice or the lapse of any
required period of time, would be an Event of Default.

4.4 Right to Inspect and Audit. Any Bank (through any of its officers, employees,
agents or other persons designated by such Bank) shall have the right, at its own expense (except
after the occurrence of an Event of Default at Borrower’s expense and without notice) upon
reasonable prior notice, from time to time during Borrower’s usual business hours, to inspect
Borrower’s Books and to make copies thereof and to inspect, check, test, audit and appraise the
Collateral and Borrower’s business affairs in order to verify Borrower’s financial condition or the
amount, condition of, or any other matter relating to the Collateral and Borrower’s compliance with
the terms and conditions of this Agreement and the other Loan Documents. A Bank shall make
reasonable efforts to minimize disruption of Borrower’s operations when conducting such work.
Borrower shall permit representatives of the Banks to discuss the business, operations, properties
and financial and other conditions of Borrower with its officers, board members, executives,
managers, members, partners, employees, agents, independent certified public accountants and
others, as applicable. The representatives of the Banks will maintain the confidentiality of
non-public information obtained from such discussions or otherwise and will not trade the
Borrower’s stock based upon material, non-public information concerning the Company that the
representatives of the Banks may obtain. Notwithstanding the foregoing provisions of this Section
4.4, the Banks shall not be required to give prior notice or limit their inspections to normal
business hours if they, or any of them, deem an emergency or other extraordinary situation to exist
with respect to the Collateral, Borrower’s Books and their other rights hereunder.

4.5 Collection of Accounts. In addition to its other rights and remedies in this
Agreement, the Banks shall have the rights and remedies set forth in this Section 4.5, all of which
may be exercised by the Banks, or any of them, upon the occurrence of an Event of Default, or the
occurrence of an event which, upon the giving of any required notice or the lapse of any required
period of time, would be an Event of Default.

(a) After the occurrence of an Event of Default, but subject to the terms of the Intercreditor
Agreement, or the occurrence of an event or condition which, after the giving of any required
notice and the lapse of any required period of time, would be an Event of Default, each Bank is
authorized and empowered at any time in its sole discretion (i) to demand, collect, settle,
compromise for, recover payment of, to hold as additional security for the Obligations and to apply
against the Obligations any and all sums which are now owing and which may hereafter arise and
become due and owing upon any of said Accounts and upon any other obligation to Borrower (to
include making, settling, adjusting, collecting and recovering payment of all claims under and
decisions with respect to Borrower’s policies of insurance); (ii) to enforce payment of any Account
and any other obligation of any person to Borrower either in its own name or in the name of
Borrower; (iii) to endorse in the name of Borrower and to collect any instrument or other medium of
payment, whether tangible or electronic, tendered or received in payment of the Accounts that
constitute Collateral and any other obligation to Borrower; (iv) to sign Borrower’s name on any
invoice or bill of lading relating to any Account, drafts against account debtors, schedules and
assignments of Accounts, verifications of Accounts and notices to account debtors; and (v) dispose
of any Collateral constituting Accounts and to convert any Collateral constituting Accounts into
other forms of Collateral. But, under no circumstances shall any Bank be under any duty to act in
regard to any of the foregoing matters. Without limiting the provisions of Section 4.3 hereof, but
in addition thereto, Borrower hereby appoints each Bank and any employee or representative of each
Bank as such Bank may from time to time designate, as attorneys-in-fact for Borrower, to sign and
endorse in the name of Borrower, to give notices in the name of Borrower and to perform all other
actions necessary or desirable in the reasonable discretion of such Bank to effect these provisions
and carry out the intent hereof. Borrower hereby ratifies and approves all lawful acts of such
attorneys-in-fact and except as otherwise provided for herein, neither any Bank nor any other such
attorneys-in-fact will be liable for any lawful acts of commission or omission nor for any error of
judgment or mistake of fact or law. The foregoing power, being coupled with an interest, is
irrevocable so long as any Account pledged and assigned to such Bank remains unpaid and this
Agreement or any other Loan Document is in force. The costs and expenses of such collection and
enforcement shall be borne solely by Borrower whether the same are incurred by a Bank or on behalf
of a Bank or Borrower and, if paid or incurred by a Bank, the same shall be an Obligation owing by
Borrower to such Bank, payable on demand with interest at the Default Rate, and secured by this
Agreement and the other Loan Documents. Borrower hereby irrevocably authorizes and consents to all
account debtors and other persons communicating after an Event of Default with any Bank, or its
agent, with respect to Borrower’s property, business and affairs and to all of the foregoing
persons acting after an Event of Default upon and in accordance with a Bank’s, or its
representative’s, instructions, directions and demands, including, without limitation, such Bank’s
request and demand to pay money and deliver other property to such Bank or Bank’s representatives,
all without liability to Borrower for so doing, except as otherwise provided herein.

(b) After the occurrence of an Event of Default, or the occurrence of an event or condition
which after the giving of any required notice or the lapse of any required period of time, would be
an Event of Default, at any Bank’s request, Borrower will forthwith upon receipt of all checks,
drafts, cash and other tangible and electronic remittances in payment or on account of Borrower’s
Accounts, deposit the same in a special bank account maintained with such Bank or its
representative, over which such Bank and its representative (as applicable) have the sole power of
withdrawal and will designate with each such deposit the particular Account upon which the
remittance was made. The funds in said account shall be held by such Bank as security for the
Obligations (and shall be subject to the terms of the Intercreditor Agreement). Said proceeds
shall be deposited in precisely the form received except for the endorsement of Borrower where
necessary to permit collection of items, which endorsement Borrower agrees to make, and which
endorsement the Bank and its representative (as applicable) are also hereby authorized to make on
Borrower’s behalf. Pending such deposit, Borrower agrees that it will not commingle any such
checks, drafts, cash and other remittances with any of Borrower’s funds or property, but will hold
them separate and apart therefrom and upon an express trust for the Banks until deposit thereof is
made in the special account. After the occurrence of an Event of Default, or the occurrence of an
event or condition which after the giving of any required notice or the lapse of any required
period of time, would be an Event of Default, the Bank maintaining such account may at anytime and
from time to time, in its sole discretion but subject to the terms of the Intercreditor Agreement,
apply any part of the credit balance in the special account to the payment of all or any of the
Obligations, and to payment of any other obligations owing to the Banks under or on account of this
Agreement or any of the other Loan Documents. On the Maturity Date and upon the full and final
payment of all of the Obligations and the other obligations as aforesaid, together with a
termination of all Bank’s obligation to make additional Advances, each Bank will pay over to the
Borrower any excess good and collected funds received by such Bank from Borrower, whether received
as a deposit in the special account or received as a direct payment on any of the Obligations.

(c) After the occurrence of an Event of Default, or the occurrence of an event or condition
which after the giving of any required notice or the lapse of any required period of time, would be
an Event of Default, each Bank shall have the absolute and unconditional right to apply for and to
obtain the appointment of a receiver, custodian or similar official for all or a portion of the
Collateral, including, without limitation, the Accounts, to, among other things, manage and sell
the same, or any part thereof, and to collect and apply the proceeds therefrom to payment of the
Obligations as provided in this Agreement and the other Loan Documents. Any such receiver,
custodian or similar official, if required, shall be qualified and licensed as a collection agency
in each state or territory in which any customer Accounts may be so collected or managed. In the
event of such application, Borrower consents to the appointment of such qualified and licensed
receiver, custodian or similar official and agrees that such receiver, custodian or similar
official may be appointed without further notice to Borrower beyond any notice required to be given
to Borrower prior to the occurrence of an Event of Default, if any, without regard to the adequacy
of any security for the Obligations secured hereby and without regard to the solvency of Borrower
or any other person who or which may be liable for the payment of the Obligations or any other
obligations of Borrower hereunder. All costs and expenses related to the appointment of a
receiver, custodian or other similar official hereunder shall be the responsibility of Borrower,
but if paid by any Bank, Borrower hereby agrees to pay to such Bank, on demand, all such costs and
expenses, together with interest thereon from the date of payment at the Default Rate. All sums so
paid by a Bank, and the interest thereon, shall be an Obligation owing by Borrower to such Bank,
and secured by this Agreement and the other Loan Documents. Notwithstanding the appointment of any
receiver, custodian or other similar official, each Bank shall be entitled as pledgee to the
possession and control of any cash, deposits, accounts, account receivables, documents, chattel
paper, documents of title or instruments at the present or any future time held by, or payable or
deliverable under the terms of the Loan Documents to such Bank. If the balance of the Obligation
outstanding is ZERO at any time prior to the Maturity Date, and no Event of Default has occurred or
is continuing and the Banks have no further obligation to make Advances, the Bank or Banks, as
applicable shall terminate the appointment of any such receiver custodian or similar official.

5. REPRESENTATIONS AND WARRANTIES.

Borrower represents and warrants to each Bank that, as of the date of this Agreement, there
are no Subsidiaries of Borrower other than the Guarantor. Further, Borrower represents and
warrants to each Bank that the certifications, representations and warranties set forth in the
Certificate of Borrower which has been executed and delivered by Borrower to each Bank
contemporaneously with the execution and delivery of this Agreement by Borrower to each Bank are
true, correct and accurate as of the date of this Agreement or such other date as may be
specifically set forth in a particular certification, representation or warranty. Borrower agrees
that all certifications, representations and warranties set forth herein shall be continuing
certifications, representations and warranties of Borrower to each Bank.

6. AFFIRMATIVE COVENANTS.

Borrower covenants and agrees that until the termination of the Banks’ obligations under this
Agreement to make Credit Extensions and the payment in full of the Obligations, Borrower shall do
each and all of the matters set forth in this Section 6; and Borrower acknowledges to each Bank
that the breach or default by Borrower of any of the covenants and agreements set forth below in
this Section 6 is and the same shall be material.

6.1 Good Standing and Government Compliance. Borrower shall maintain in good standing
its and each of its Subsidiaries’ organizational existence in their respective jurisdictions of
organization and maintain qualification in each jurisdiction in which the conduct of their
respective businesses or their respective ownership of property requires that they be so qualified.
Borrower shall comply, and shall cause each Subsidiary to comply with all Requirements of Law to
which they are subject, and shall maintain, and shall cause each of its Subsidiaries to maintain,
in force all licenses, approvals and agreements, the loss of which or failure to comply with which
could have a Material Adverse Effect, or an adverse effect in a material manner on the Collateral
or the priority of the Banks’ security interest in the Collateral.

6.2 Payment/Performance. Borrower shall pay when due all amounts owing to the Banks
under this Agreement and the other Loan Documents and promptly perform all other obligations of
Borrower thereunder and hereunder.

6.3 Use of Loan Funds. Borrower shall use all loan proceeds disbursed to Borrower
only for the purposes stated in this Agreement and the other Loan Documents.

6.4 Financial Statements; Reports; Certificates.

(a) Borrower shall deliver to each Bank each and all of the financial statements, reports,
certificates and other records referenced under this subsection (a) and such other statements,
reports, certificates and records as any Bank may reasonably request from time to time.

(i) As soon as available, but in any event within thirty (30) days after the end of each
calendar quarter, Borrower shall deliver to each Bank internally prepared consolidated financial
statements.

(ii) Beginning with the fiscal year ending December 31, 2005, as soon as available, but in any
event within one hundred twenty (120) days after the end of Borrower’s fiscal year, Borrower shall
deliver to each Bank audited CPA prepared consolidated and, upon request of any Bank, internally
prepared consolidating, financial statements of Borrower (including a balance sheet, an income
statement and a statement of retained earnings, each with the related notes and changes in the
financial position for such year and setting forth in comparative form the figures for the prior
year) prepared in accordance with GAAP, consistently applied, together with (with respect to the
CPA prepared statements) an opinion on such financial statements that is unqualified or qualified
in a manner acceptable to the Banks from an independent certified public accounting firm reasonably
acceptable to the Banks. After the occurrence of an Event of Default, any Bank may request and
Borrower shall so provide audited CPA prepared consolidating statements which meet the foregoing
requirements established for consolidated statements.

(iii) Within thirty (30) days after the last day of each fiscal quarter, Borrower shall
deliver to each Bank a statement of Borrower’s Net Finance Receivable prepared and presented in a
manner and format consistent with past practice and consistent with the manner and format employed
in Borrower’s public filings, and will be consistent with the information contained in Borrower’s
public filings for the same periods.

(iv) If applicable, Borrower shall deliver to each Bank copies of all statements, reports and
notices sent or made available generally by Borrower to its security holders or to any holders of
Subordinated Liabilities and all reports on Forms 10-K and 10-Q filed with the Securities and
Exchange Commission.

(v) Within thirty (30) days after the last day of each fiscal quarter, Borrower shall deliver
to each Bank a report of any legal actions pending or threatened against Borrower or any
Subsidiary, which report shall include at a minimum the claimant, the amount of the claim, the
defendants named and the date of such claim. Borrower agrees to cooperate in good faith with
respect to any additional information requested by any Bank with respect to such reports.

(b) Within thirty (30) days after the last day of each month, Borrower shall deliver to each
Bank a Borrowing Base Certificate dated and signed by a Responsible Officer in substantially the
form of Exhibit D hereto that provides the required information that is current within one
day.

(c) Within thirty (30) days after the last day of each month, Borrower shall deliver to each
Bank with the monthly financial statements a Compliance Certificate signed by a Responsible Officer
in substantially the form of Exhibit E hereto.

(d) Borrower shall provide such additional statements and information as any Bank may from
time to time request, in form reasonably acceptable to the Banks. Each Bank shall keep such
information confidential which is marked “Confidential” and which has not been disclosed to third
parties, and shall not disclose such information to any department of such Bank which provides
investment and stock brokerage services.

6.5 Taxes. Borrower shall make, and shall cause each Subsidiary to make, due and
timely payment of, or deposit or withholding of, all federal, state and local taxes, assessments or
contributions required of it by all Requirements of Law, and will execute and deliver to each Bank,
on demand, appropriate certificates attesting to the payment, deposit or withholding thereof;
provided that Borrower or a Subsidiary need not make any payment if the amount or validity of such
payment is contested in good faith by appropriate proceedings and is reserved against (to the
extent required by GAAP) by Borrower.

6.6 Insurance.

(a) Borrower, at its expense, shall keep the Collateral insured against loss or damage by
fire, theft, explosion, sprinklers and all other hazards and risks required by the Banks, acting
reasonably and taking into account the types and risks customarily insured against by businesses
similar to Borrower’s. Unless otherwise directed by the Banks, the insurance shall be all risk
replacement cost insurance with agreed amount endorsement, standard noncontributing mortgagee
clauses and standard waiver of subrogation clauses. Borrower shall also maintain general
liability, workmen’s compensation and other insurance in amounts and of a type that are customary
to businesses similar to Borrower’s, unless the Banks reasonably direct otherwise, in which event
Borrower shall maintain such insurance in amounts and types as the Banks reasonably direct.

(b) All policies of insurance shall be in such form and with such companies as may be
reasonably satisfactory to the Banks. All policies of property insurance shall contain a lender’s
loss payable endorsement, in a form reasonably satisfactory to the Banks, showing the Banks,
collectively, as additional loss payees, and all liability insurance policies shall show the Banks,
collectively, as additional insureds. All policies shall specify that the insurer must give at
least twenty (20) days’ notice to each Bank before canceling its policy for any reason. Upon any
Bank’s request, Borrower shall deliver to each Bank certified copies of the policies of insurance
and evidence of all premium payments. All proceeds payable under any casualty policy or policies
shall, at the payee Bank’s option, be payable to such Bank to be applied on account of the
Obligations, except for casualty policies insuring loss of assets encumbered by Permitted Liens
which are prior to the Lien of such Bank.

6.7 Primary Depository. Each of Borrower and its wholly owned Subsidiaries (excluding
the operating depositing account of PRA Receivables Management, LLC, d/b/a Anchor Receivables
Management) shall maintain their primary operating depository accounts with the Banks during the
term of the Revolving Facility. At least one operating deposit account shall be maintained with
each Bank.

6.8 Financial Covenants. On a consolidated basis, Borrower shall maintain, as of the
last day of each calendar month unless stated otherwise, and Borrower shall fully and timely comply
on a consolidated basis with, each and every one of the financial maintenance covenants set forth
in this Section and others that may be contained in this Agreement and the other Loan Documents.

(a) Funded Debt to EBITDA. A ratio not exceeding 2.0:1.0.

(b) Tangible Net Worth. Maintain on a consolidated basis Tangible Net Worth equal to
at least 100% of Tangible Net Worth reported by Borrower at September 30, 2005, plus 25% of
cumulative positive net income accrued since the end of such fiscal quarter, plus 100% of the net
proceeds from any equity offering, calculated quarterly on the last day of each fiscal quarter.
For purposes of this covenant, Tangible Net Worth of Borrower shall be calculated without giving
effect to reductions in Tangible Net Worth due to repurchases of up to $100,000,000 of Borrower’s
capital stock by Borrower.

6.9 Maintenance of Property. Borrower shall keep and maintain the Collateral in good
working order and condition and make all needful and proper repairs, replacements, additions, or
improvements thereto as are necessary, reasonable wear and tear excepted.

6.10 Maintain Security Interest. Borrower shall maintain, protect and preserve the
security interest of the Banks in the Collateral and the lien position of the Banks in the
Collateral, including, without limitation, (i) the filing of “claims” under insurance policies and
(ii) protecting, defending and maintain the validity and enforceability of the Trademarks, Patents
and Copyrights.

6.11 Deposit Accounts. With respect to deposit accounts that are maintained with
financial institution other than the Banks, the Banks, or any of them, may request, and Borrower
and each of its Subsidiaries shall obtain in favor of such Bank(s), a control agreement in form and
substance satisfactory to such Bank(s).

6.12 Further Assurances. At any time and from time to time, Borrower shall execute
and deliver such further instruments, agreements, documents and other records and take such further
action as may be requested by any Bank to effect the purposes of this Agreement, including, without
limitation, the perfection and continuation of perfection of the Banks’ security interests in the
Collateral.

7. NEGATIVE COVENANTS.

Borrower covenants and agrees that until the termination of all Banks’ obligations under this
Agreement to make Credit Extensions, and the payment in full of the Obligations, Borrower shall not
do or permit to be done any of the matters set forth in this Section 7; and Borrower acknowledges
to each Bank that the breach or default by Borrower of any of the covenants and agreements set
forth below in this Section 7 is and the same shall be material.

7.1 Dispositions. Borrower shall not convey, sell, lease, transfer and otherwise
dispose of and Borrower shall not permit any of its Subsidiaries to convey, sell, lease, transfer
and otherwise dispose of (with respect to both Borrower and Borrower’s Subsidiaries, by operation
of law or otherwise) any part of and any interest in their respective businesses and properties,
including the Collateral, other than Permitted Transfers.

7.2 Change in Business; Change in Management or Executive Office. Borrower shall not
engage in any business, or permit any of its Subsidiaries to engage in any business, other than as
reasonably related or incidental to the businesses currently engaged in by Borrower. Borrower
shall not have a Change in Management and will not, without thirty (30) days’ prior written
notification to each Bank, relocate its chief executive office, change its state of organization or
change any other matter that will or could result in any Bank’s security interests in the
Collateral becoming unperfected.

7.3 Mergers or Acquisitions; New Subsidiary. Except for Permitted Acquisitions,
Borrower shall not merge or consolidate, or permit any of its Subsidiaries to merge or consolidate,
with or into any other business organization, or acquire, or permit any of its Subsidiaries to
acquire, all or substantially all of the capital stock or property of another person without the
prior written consent of each Bank, which any Bank may grant or withhold in its sole and absolute
discretion. Borrower shall not create or cause to be created or to come into existence any new
Subsidiary after the Closing Date, without the prior written consent of each Bank.

7.4 Indebtedness. Borrower shall not create, incur, assume or be or remain liable
with respect to any Indebtedness, or permit any Subsidiary so to do, other than Permitted
Indebtedness and normal and customary unsecured indebtedness incurred in the ordinary course of
business. With respect to Indebtedness described in clause (iii) of the definition of Permitted
Indebtedness in Exhibit A, to the extent not specifically prohibited by the terms of such
Indebtedness, the Banks shall have a subordinate lien in and to all equipment and property financed
or acquired with such Indebtedness (with the priority and allocation of such subordinate lien among
the Banks to be determined pursuant to the Intercreditor Agreement).

7.5 Encumbrances. Borrower shall not create, incur, assume or allow any Lien with
respect to the Collateral or any of its property, or assign or otherwise convey any right to
receive income, including the sale of any Accounts, or permit any of its Subsidiaries so to do,
except for Permitted Liens, or covenant to any other person that Borrower in the future will
refrain from creating, incurring, assuming or allowing any Lien with respect to any of Borrower’s
property.

7.6 Judgments. Borrower shall not permit a judgment or judgments for the payment of
money in excess of $500,000 in the aggregate to be entered against it or any Subsidiary which
judgment Borrower permits to remain unsatisfied or unstayed for a period of thirty (30) days after
the same is entered against Borrower or a Subsidiary.

7.7 Distributions. Except for Permitted Dividends and Permitted Investments, Borrower
shall not pay any dividends or make any other distribution or payment on account of or in
redemption, retirement or purchase of any capital stock, or permit any of its Subsidiaries to do
so.

7.8 Investments. Borrower shall not directly or indirectly acquire or own, or make
any Investment in or to any person, or permit any of its Subsidiaries so to do, other than
Permitted Investments.

7.9 Loans. Except for Permitted Investments and Permitted Acquisitions, Borrower
shall not make or commit to make, or permit any of its Subsidiaries to make or commit to make, any
advance, loan, extension of credit or capital contribution to, or purchase of any stock, bonds,
notes, debentures or other securities of any person.

7.10 Loans to Officers. Borrower shall not make, or permit any of its Subsidiaries
to make, any loan or advance directly or indirectly for the benefit of any past, present, or future
stockholder, director, officer, executive, manager, member, partner or employee of Borrower or a
Subsidiary, as the case may be, other than advances or loans made in the ordinary course of
business consistent with past practice, including but not limited to employee relocation loans,
employee bridge loans and other incidental loans to employees, all in the ordinary course of
business.

7.11 Compensation. Borrower shall not pay, or permit any Subsidiary to pay, any
compensation to any past, present or future shareholder, director, officer, executive, member,
manager, partner and employee, whether through salary, bonus or otherwise, if contrary to
Borrower’s compensation policies or the executive compensation rules established by the United
States Securities and Exchange Commission or the NASDAQ Stock Exchange.

7.12 Transactions with Affiliates. Borrower shall not directly or indirectly enter
into or permit to exist, or permit any Subsidiary to directly or indirectly enter into or permit to
exist, any material transaction with any Affiliate of Borrower or any Subsidiary except for
transactions that are in the ordinary course of Borrower’s or such Subsidiary’s business, upon fair
and reasonable terms that are no less favorable to Borrower or Subsidiary than would be obtained in
an arm’s length transaction with a non-affiliated Person.

7.13 Subordinated Liabilities. Borrower shall not make any payment in respect of any
Subordinated Liabilities, or permit any of its Subsidiaries to make any such payment except in
compliance with the terms of such Subordinated Liabilities, or amend any provision contained in any
documentation relating to the Subordinated Liabilities without each Bank’s prior written consent.

7.14 Inventory and Equipment. Borrower shall not store, or permit any Subsidiary to
store, its Equipment with a bailee, warehouseman or similar person unless the Banks have received a
pledge of the warehouse receipt covering such Equipment. Except for such other locations as each
Bank may approve in writing, Borrower shall not move or relocate its Equipment from the location or
locations identified in the Certificate of Borrower and such other locations of which Borrower
gives each Bank prior written notice and as to which Borrower authorizes the filing of a Financing
Statement where needed to perfect each Bank’s security interest.

7.15 Licenses. Borrower shall not become bound by, or permit its Subsidiaries to
become bound by, any license, agreement or other record which would have a Material Adverse Effect.

7.16 Compliance. Borrower shall not become or be controlled by an “investment
company”, within the meaning of the Investment Company Act of 1940, or become principally engaged
in, or undertake as one of its important activities, the business of extending credit for the
purpose of purchasing or carrying margin stock, or use the proceeds of any Credit Extension for
such purpose, or permit any of its Subsidiaries to do any of the foregoing.

7.17 Negative Pledge Agreements. Borrower shall not permit the inclusion in any
contract to which it becomes a party of any provisions that could restrict or invalidate the
creation of a security interest in Borrower’s rights and interests in any Collateral.

7.18 Third Party Agreements. Borrower shall not enter into any agreement containing
any provision that would be violated or breached by the performance of the obligations of Borrower
under this Agreement.

8. EVENTS OF DEFAULT.

The occurrence of any one or more of the events, conditions, circumstances and matters set
forth below in this Section 8 shall constitute an Event of Default by Borrower under this Agreement
and the other Loan Documents. Notwithstanding the foregoing and anything else in this Agreement to
the contrary, if any of the Obligations are payable on demand of the Banks, or any of them, then,
in such event, there are no conditions precedent to any such Bank’s right to demand payment of such
Obligations, in whole or in part, at any time and from time to time, without prior notice, until
the entire unpaid balance outstanding under such Obligations, including principal, interest, fees,
premiums, charges and costs and expenses are paid in full. And, there are no conditions precedent
to any Bank exercising any of and all of its other rights and remedies at such time or times as it
deems necessary or appropriate to recover full payment of the Obligations, including, without
limitation, the exercise of any of and all of its rights and remedies set forth in Section 9 below,
the exercise of any of and all of its other rights and remedies granted to it under the Loan
Documents and the exercise of any of and all of its rights and remedies at law and in equity. The
rights and obligations of the Banks relative to each other with respect to the priority of liens
and the exercise of rights against, and the allocation of, the Collateral, are set forth in the
Intercreditor Agreement.

8.1 Default under Obligations. The occurrence of any event of default or default
condition under any of the Obligations, including, without limitation, Borrower’s failure to pay,
when due, the principal of and interest on any of the Obligations, or Borrower’s failure to pay,
when due, any and all other amounts due under any of the Obligations, including, without
limitation, any taxes, fees, charges, premiums and costs and expenses.

8.2 Covenant Default. Borrower fails to perform or satisfy any obligation under
Section 6 or violates any of the covenants contained in Section 7 of this Agreement, or fails or
neglects to perform or observe or otherwise defaults under any other term, provision, condition,
covenant or agreement contained in this Agreement, in any of the other Loan Documents, or in any
other present or future instrument, document, agreement or other record between Borrower and any
Bank or from Borrower to any Bank or for the benefit of any Bank, whether monetary or non-monetary,
and as to any default under such other term, provision, condition, covenant or agreement that can
be cured, has failed to cure such default within ten (10) days after Borrower receives notice
thereof or any officer of Borrower becomes aware thereof; provided, however, that if the default is
non-monetary and cannot by its nature be cured within the ten (10) day period or cannot after
diligent attempts by Borrower be cured within such ten (10) day period, and such default is likely
to be cured within a reasonable time, then Borrower shall have an additional reasonable period
(which shall not in any case exceed thirty (30) days) to attempt to cure such non-monetary default,
and within such reasonable time period the failure to have cured such default shall not be deemed
an Event of Default (provided that the Banks shall not be required to make any Credit Extensions
during such cure period).

8.3 Guarantor Default. The failure of any other person obligated for the payment of
any of the Obligations, either directly or indirectly, or obligated under this Agreement or any of
the other Loan Documents to perform any of the terms and conditions imposed upon such other person
by any of said agreements, as and when the same are required to be so performed, or the occurrence
of some other default by such other person under any of said agreements.

8.4 Termination of Supporting Obligation. The termination of or the occurrence of an
event of default or a default condition, after the expiration of any applicable cure periods, under
any guaranty agreement or other supporting obligation (inclusive of letters of credit, third person
pledge agreements and third person security agreements) which applies to this Agreement or any of
the other Loan Documents.

8.5 Attachment. Borrower’s assets, or any part or portion thereof, are attached,
seized, subjected to a writ or distress warrant, or are levied upon, or come into the possession of
any trustee, receiver or person acting in a similar capacity and such attachment, seizure, writ or
distress warrant or levy has not been removed, discharged or rescinded within ten (10) days, or if
Borrower is enjoined, restrained or in any way prevented by court order from continuing to conduct
all or any material part of its business affairs, or if a judgment or other claim becomes a lien or
encumbrance upon any material portion of Borrower’s assets, or if a notice of lien, levy or
assessment is filed of record with respect to any of Borrower’s assets by the United States
Government, or any department, agency or instrumentality thereof, or by any state, county,
municipal or governmental agency, and the same is not paid within ten (10) days after Borrower
receives notice thereof, provided that none of the foregoing shall constitute an Event of Default
where such action or event is stayed or an adequate bond has been posted pending a good faith
contest by Borrower (provided that no Credit Extensions will be required to be made during such
cure period).

8.6 Insolvency. Borrower becomes insolvent, or an Insolvency Proceeding is commenced
by Borrower, or an Insolvency Proceeding is commenced against Borrower and is not dismissed or
stayed within thirty (30) days (provided that no Credit Extensions will be required to be made
prior to the dismissal of such Insolvency Proceeding).

8.7 Other Agreements. The occurrence of a default in any agreement or agreements to
which Borrower is a party with a third person or persons which results in a right by such third
person or persons, whether or not exercised, to accelerate the maturity of any Indebtedness in an
amount in the aggregate in excess of 2% of Borrower’s Tangible Net Worth or that could have a
Material Adverse Effect.

8.8 Subordinated Liabilities. Borrower makes any payment on account of Subordinated
Liabilities, except to the extent the payment is allowed under any subordination agreement entered
into with the Banks.

8.9 Misrepresentations. Any misrepresentation or misstatement exists now or hereafter
in any warranty or representation set forth herein, in any other Loan Document or in any
certificate delivered to any Bank by any Responsible Officer pursuant to this Agreement or any
other Loan Document, or to induce any Bank to enter into this Agreement or any other Loan Document.

8.10 ERISA. An ERISA Event occurs that will cause a Material Adverse Effect.

8.11 Subsidiary Default. Default by any of Borrower’s Subsidiaries under any
Indebtedness or other obligation now owing or which hereafter arises and is owing to any Bank.

9. BANK’S RIGHTS AND REMEDIES UPON DEFAULT.

9.1 Rights and Remedies upon an Event of Default. If an Event of Default shall occur
under this Agreement, in addition to any other rights and remedies which may be available to the
Banks and without limiting any other rights and remedies granted to the Banks in this Agreement,
the other Loan Documents and at law and in equity, including, without limitation, the rights and
remedies provided to the Banks under the Code, which rights and remedies are fully exercisable by
each Bank as and when provided herein and therein, the Banks shall have the rights and remedies set
forth below in this Section 9.1, any and all of which any Bank may exercise at its election,
without notice to Borrower of its election and without demand, but subject to the rights of each
other Bank under the Intercreditor Agreement, and with immediate written notice to each other Bank
of the exercise of any such right or remedy.

(a) Acceleration of Obligations. Any Bank may, at its option, accelerate and declare
immediately due and payable the Obligations owing to it, as well as any of and all of the other
indebtedness and obligations owing under this Agreement and the other Loan Documents that are not
already due hereunder to such bank. If there is more than one Obligation, any Bank may accelerate
and declare immediately due and payable all of the Obligations owing to it, or any Bank may from
time to time and at any number of times after the occurrence of an Event of Default, accelerate and
declare immediately due and payable any one or more of the Obligations owing to it, as such Bank in
its discretion elects to accelerate (provided that upon the occurrence of an Event of Default
described in Section 8 under the heading “Insolvency”, all Obligations shall become immediately due
and payable without any action by any Bank).

(b) Terminate Credit Extensions. Each Bank may limit Borrower’s right to receive any
and all Advances under this Agreement and under any other agreement between such Bank and Borrower
to such amounts as such Bank determines from time to time to be appropriate under the
circumstances; each Bank may impose a moratorium on future Advances under this Agreement and under
any other agreement between such Bank and Borrower; and each Bank may terminate the right of
Borrower to receive Advances under this Agreement and under any other agreement between Borrower
and such Bank; and in all the foregoing instances, a Bank’s rights relative to Credit Extensions
may be exercised cumulatively, concurrently, alternatively and in any other manner and at any time
or times as such Bank deems appropriate, in its discretion.

(c) Protection of Collateral. Each Bank may make such payments and do or cause to be
done such acts as such Bank considers necessary or advisable to protect the Collateral and to
preserve, protect, perfect and continue the perfection of its security interest in the Collateral.
Borrower agrees to assemble the Collateral if any Bank so requires and to make the Collateral
available to a Bank as such Bank (subject to the Intercreditor Agreement) may designate. Borrower
authorizes each Bank and its representatives to enter the premises where the Collateral is located,
to do, among other things a Bank deems necessary or advisable, the following: (i) take and
maintain possession of the Collateral, or any part or parts of it, (ii) pay, purchase, contest or
compromise any encumbrance, charge or lien which in a Bank’s determination appears to be prior or
superior to its security interest, and (iii) pay all costs and expenses incurred in connection with
any of the foregoing. With respect to any of Borrower’s premises, Borrower hereby grants each Bank
a license to enter into possession of such premises and to occupy the same, without charge, in
order to exercise any of the Banks’ rights and remedies provided herein, at law, in equity and
otherwise.

(d) Sale and Disposition of Collateral Upon Default.

(i) Each Bank, directly and through others on its behalf, may ship, reclaim, recover, store,
finish, maintain, repair, prepare for sale, advertise for sale and/or sell the Collateral, or part
or parts thereof, for cash or on terms, at one or more private or public sales held at such place
or places as such Bank determines to be commercially reasonable, after having complied with the
provisions of this Agreement, the Intercreditor Agreement, the other Loan Documents and applicable
Requirements of Law relating to sale of the Collateral, including, without limitation, the
requirements of the Code. Each Bank is hereby irrevocably granted a license or other right,
pursuant to the provisions of this Section 9.1, to use, without charge, Borrower’s labels, patents,
copyrights, rights of use of any name, trade secrets, trade names, trademarks, service marks,
advertising matter and any property of a similar nature, together with the right of access to all
tangible or electronic media in which any of the foregoing may be recorded or stored, in completing
production of, management of, advertising for sale and selling any Collateral and, in connection
with a Bank’s exercise of its rights under this Section 9.1, Borrower’s rights under all licenses
and all franchise agreements shall inure to the Banks’ benefit. Borrower hereby agrees: (i) that
fifteen (15) days notice of any intended sale or disposition of any Collateral is commercially
reasonable; (ii) that a shorter period of notice of not less than ten (10) days will be
commercially reasonable if each Bank, in its opinion, deems it necessary to move more expeditiously
with disposition of the Collateral or any part thereof; and (iii) that the foregoing shall not
require a notice if no notice is required under the Code (except immediate notice to each other
Bank).

(ii) Each Bank, or any or all of them, may credit bid and purchase at any sale or sales.

(iii) The proceeds of any sale of, or other realization upon, all or any part of the
Collateral pursuant to this Section 9.1 shall be applied by the Banks in the following order of
priorities (subject to the terms of the Intercreditor Agreement), or such other order as the Banks,
together, may determine or as may be required under applicable Requirements of Law: first,
to payment of the costs and expenses of such sale or other realization, and all expenses,
liabilities and advances incurred or made by the Banks in connection therewith, and any other
unreimbursed costs and expenses for which the Banks are to be reimbursed pursuant to this Agreement
and the other Loan Documents; second, to the payment of accrued but unpaid interest on the
Obligations; third, to the payment of unpaid principal of the Obligations; fourth,
to the payment of all other amounts owing or outstanding by Borrower under the Obligations, this
Agreement, the other Loan Documents and otherwise to any Bank as provided herein or therein, until
all the foregoing shall have been paid in full; finally, to payment to Borrower or its
successors or assigns, or as a court of competent jurisdiction may direct, of any surplus then
remaining from such proceeds.

(iv) Any deficiency that exists after disposition of the Collateral as provided above will be
paid immediately by Borrower, without demand by any Bank, but this provision shall not require any
Bank to first dispose of the Collateral before attempting to recover payment of the Obligations
from Borrower or any other person and each Bank shall have the right to proceed successively,
concurrently and alternatively against the Collateral, the Borrower and any other person obligated
on any of the Obligations in any order and at any time or times as it deems to be in its best
interest.

(e) Discontinuance of Proceedings; Position of Parties Restored. If any Bank shall
have proceeded to enforce any right or remedy under the Loan Documents by foreclosure, entry, or
otherwise and such proceedings shall have been discontinued or abandoned for any reason, or such
proceedings shall have resulted in a final determination adverse to any Bank, then and in every
such case Borrower and each Bank shall be restored to their former positions and rights hereunder,
and all rights, powers and remedies of the Banks shall continue as if no such proceedings had
occurred or had been taken.

9.2 Remedies Cumulative. Each Bank’s rights and remedies under this Agreement, the
Loan Documents and all other agreements shall be cumulative and may be exercised successively,
concurrently, alternatively and in any other order and at such time or times as any Bank elects in
its discretion. Each Bank shall have all other rights and remedies not inconsistent herewith as
provided under the Code, by law and in equity. No exercise by any Bank of one right or remedy
shall be deemed an election, and no waiver by any Bank, or all of them, of any Event of Default on
Borrower’s part shall be deemed a continuing waiver. No delay by any Bank, or all of them, shall
constitute a waiver, election or acquiescence by it. No waiver by any Bank shall be effective
unless made in a written document signed on behalf of such Bank and then shall be effective only in
the specific instance and for the specific purpose for which it was given. For the avoidance of
doubt, a waiver of one Bank shall not in any event constitute a waiver by any other Bank absent its
execution thereof.

10. NOTICES.

Unless otherwise provided in this Agreement, all notices or demands by any party relating to
this Agreement or any other agreement entered into in connection herewith shall be in writing and
(except for financial statements and other informational documents which may be sent by first-class
mail, postage prepaid) shall be personally delivered or sent by a recognized overnight delivery
service, certified mail, postage prepaid, return receipt requested, or by facsimile to Borrower or
to a Bank, as the case may be, at their respective addresses as set forth on the signature page of
this Agreement. Any such notice or demand sent by or to Borrower shall be sent simultaneously to
all Banks. The parties may change the address at which they are to receive notices hereunder by
notice in writing in the foregoing manner given to the other.

11. WAIVERS.

11.1 Waiver Of Trial By Jury. To the extent not prohibited by applicable Requirements
of Law, Borrower and each Bank hereby waive their respective rights to a jury trial of any claim or
cause of action based upon or arising out of any of the Loan Documents or any of the transactions
contemplated therein, including contract claims, tort claims, breach of duty claims and all other
common law or statutory claims. Each party recognizes and agrees that the foregoing waiver
constitutes a material inducement for it to enter into this Agreement. Each party represents and
warrants that it has reviewed this waiver with its legal counsel and that it knowingly and
voluntarily waives its jury trial rights following consultation with legal counsel.

11.2 Marshalling of Assets. Borrower hereby waives, to the extent permitted by law,
the benefit of all appraisal, valuation, stay, extension, reinstatement and redemption laws now in
force and those hereafter in force and all rights of marshalling in the event of any sale hereunder
of the Collateral or any part or any interest therein.

11.3 Waiver of Action Against Third Persons. Borrower waives any right to require any
Bank to bring any action against any other person or to require that resort be had to any security
or to any balances of any deposit or other accounts or debts or credits on the books of any such
Bank in favor of any other person.

12. GENERAL PROVISIONS.

12.1 Indemnification. Borrower hereby agrees to defend, protect, indemnify and hold
harmless each Bank, all directors, officers, employees, attorneys, agents and independent
contractors of each Bank, from and against all claims, actions, liabilities, damages and costs and
expenses asserted against, imposed upon or incurred by such Bank or any of such other persons as a
result of, or arising from, or relating to this Agreement, the other Loan Documents or the
transactions contemplated hereby or thereby, except for losses resulting from the gross negligence
or willful misconduct of or breach of this Agreement by, the person otherwise to be indemnified
hereunder.

12.2 Choice of Law. This Agreement shall be deemed to have been executed and
delivered in the Commonwealth of Virginia regardless of where the signatories may be located at the
time of execution and shall be governed by and construed in accordance with the substantive laws of
the Commonwealth of Virginia, excluding, however, the conflict of law provisions thereof.

12.3 Additional Lenders. Additional lenders may be added to this credit facility upon
the written consent of all parties hereto, the execution by such additional lenders of an
additional signature page to this Agreement evidencing such lender’s agreement to be bound by the
terms hereof, and the similar execution by such lenders of the Intercreditor Agreement and such
other instruments and agreements as may be required by the Banks then party hereto. The joinder of
any such lender to this credit facility shall not in any way affect the rights or obligations of
the Banks then party hereto, except that the Commitments hereunder shall be adjusted from the date
of such joinder in such manner as all parties may agree. Any such additional lender shall be
deemed a “Bank” for purposes of this Agreement.

12.4 Incorporation of Exhibits; Customer and Loan Numbers. All exhibits, schedules,
addenda and other attachments to this Agreement are by this reference incorporated herein and made
a part hereof as if fully set forth in the body of this Agreement. The Customer and Loan Numbers,
if any, stated in this Agreement are for the respective Bank’s internal business use and reference
only and do not and shall not limit the scope and extent of any Bank’s rights hereunder, including
the Obligations secured hereby and the security interests of the Banks in the Collateral.

12.5 Maintenance of Records by Banks. Borrower acknowledges and agrees that each Bank
is authorized to maintain, store and otherwise retain the Loan Documents or any of them in their
original, inscribed tangible form or a record thereof in an electronic medium or other non-tangible
medium which permits such record to be retrieved in a perceivable form; that a record of any of the
Loan Documents in a non-tangible medium which is retrievable in a perceivable form shall be the
agreement of Borrower to the same extent as if such Loan Document was in its original, inscribed
tangible medium and such a record shall be binding on and enforceable against Borrower
notwithstanding the same is in a non-tangible form and notwithstanding the signatures of the
signatories hereof are electronic, typed, printed, computer generated, facsimiles or other
reproductions, representations or forms; and that a Bank’s certification that a non-tangible record
of any of the Loan Documents is an accurate and complete copy or reproduction of the original,
inscribed tangible form shall be conclusive, absent clear and convincing evidence of the
incorrectness of said certification, and such non-tangible record or a reproduction thereof shall
be deemed an original and have the same force and effect as the original, inscribed tangible form.

12.6 Credit Investigations; Sharing of Information; Control Agreements. Each Bank is
irrevocably authorized by Borrower, during the term of this Agreement and until the last to occur
of (i) payment in full of all the Obligations and (ii) termination of the Banks’ obligations to
make Credit Extensions under this Agreement, to make or have made such credit investigations as it
deems appropriate to evaluate Borrower’s and its Subsidiaries’ credit or financial standing, and
Borrower authorizes each Bank to share with its affiliates its experiences with Borrower and its
Subsidiaries and other information in Bank’s possession relative to Borrower and its Subsidiaries.
The Banks (i) shall not have any obligation or responsibility to provide information to third
persons relative to any Bank’s security interest in the Collateral, this Agreement or otherwise
with respect to Borrower and its Subsidiaries and (ii) shall not have any obligation or
responsibility to subordinate its security interest in the Collateral to the interests of any third
persons or to enter into control agreements relative to the Collateral.

12.7 Banks’ Liability for Collateral. Notwithstanding anything in this Agreement or
any of the other Loan Documents to the contrary, a Bank may at any time or times during the term of
this Agreement make such payments and do or cause to be done such acts as a Bank considers
necessary or advisable to protect the Collateral and to preserve, protect and perfect or continue
the perfection of its security interest in the Collateral. So long as a Bank complies with
reasonable banking practices, except as may be provided herein to the contrary, such Bank shall not
in any way or manner be liable or responsible for: (i) the safekeeping of the Collateral; (ii) any
loss or damage thereto occurring or arising in any manner or fashion from any cause; (iii) any
diminution in the value thereof; or (iv) any act or default of any carrier, warehouseman, bailee,
forwarding agency or other person whomsoever.

12.8 Bank Expenses. If Borrower fails to pay any amounts or furnish any required
proof of payment due to third persons, as required under the terms of this Agreement and the other
Loan Documents, then after ten (10) days prior written notice to Borrower, and Borrower’s failure
to pay such amounts, the Banks, or any of them, may do or cause to be done any or all of the
following: (i) make payment of the same or any part thereof; (ii) set up such reserves as such
Bank(s) deems necessary to protect it from the exposure created by such failure; and (iii) obtain
and maintain insurance policies of the type required by this Agreement, and take any action with
respect to such policies as any Bank deems prudent. Any amounts so paid or deposited by such Bank
shall constitute Bank Expenses, shall be immediately due and payable, shall bear interest at the
Default Rate from the date of payment or deposit and shall be secured by the Collateral. Any
payments made by a Bank shall not constitute an agreement by a Bank to make similar payments in the
future or a waiver by any Bank of any Event of Default under this Agreement. If a Bank is
requested to waive an Event of Default or forbear taking action relative thereto, such Bank may
condition any waiver or forbearance it elects, in its discretion, to grant Borrower on payment by
Borrower of such fees to Bank as such Bank deems appropriate under the circumstances and may
condition any such waiver or forbearance on Borrower reimbursing such Bank for all costs and
expenses such Bank incurs in connection with such waiver or forbearance.

12.9 No Waiver; No Course of Dealing. Any Bank, at any time or times, may grant
extensions of time for payment or other indulgences or accommodations to any person obligated on
any of the Obligations, or permit the renewal, amendment or modification thereof or substitution or
replacement therefor, or permit the substitution, exchange or release of any property securing any
of the Obligations and may add or release any person primarily or secondarily liable on any of the
Obligations, all without releasing Borrower from any of its liabilities and obligations under any
of the Loan Documents and without such Bank waiving any of its rights and remedies under any of the
Loan Documents, or otherwise, and further without effecting any release or waiver of any
liabilities, obligations, rights or remedies accruing to any other Bank. No delay or forbearance
by any Bank in exercising any or all of its rights and remedies hereunder and under the other Loan
Documents or rights and remedies otherwise afforded by law or in equity shall operate as a waiver
thereof or preclude the exercise thereof during the continuance of any Event of Default as set
forth herein or in the event of any subsequent Event of Default hereunder. Also, no act or
inaction of any Bank under any of the Loan Documents shall be deemed to constitute or establish a
“course of performance or dealing” that would require such Bank, or any of them, to so act or
refrain from acting in any particular manner at a later time under similar or dissimilar
circumstances.

12.10 Relationship of Parties; Successors and Assigns. The relationship of the Banks
to Borrower is that of a creditor to an obligor (inclusive of a person obligated on a supporting
obligation) and a creditor to a debtor; and in furtherance thereof and in explanation thereof, no
Bank has any fiduciary, trust, guardian, representative, partnership, joint venturer or other
similar relationship to or with Borrower and no such relationship shall be drawn or implied from
any of the Loan Documents or any actions or inactions of any Bank hereunder or with respect hereto
– and, no Bank has any obligation to Borrower or any other person relative to administration of any
of the Obligations and the Collateral, or any part or parts thereof, except as otherwise set forth
herein. The covenants, terms and conditions herein contained shall bind, and the benefits and
powers shall inure to, the respective heirs, executors, administrators, successors and assigns of
the parties hereto, as well as any persons who become bound hereto as a debtor. If two or more
persons or entities have joined as Borrower, each of the persons and entities shall be jointly and
severally obligated to perform the conditions and covenants herein contained. The term “Bank”
shall include any payee of the Obligations hereby secured and any transferee or assignee thereof,
whether by operation of law or otherwise, and any Bank may transfer, assign or negotiate all or any
of the Obligations secured by this Agreement from time to time without the consent of Borrower and
without notice to Borrower (but subject to the consent of each other Bank and the execution and
delivery by any such transferee or assignee of such documents, guaranties and agreements,
including, without limitation, this Agreement and the Intercreditor Agreement, as such other Banks
may reasonably require) and any transferee or assignee of any Bank or any transferee or assignee of
another may do the same without Borrower’s consent and without notice to Borrower. Borrower waives
and will not assert against any transferee or assignee of any Bank any claims, defenses, set-offs
or rights of recoupment which Borrower could assert against a Bank, except defenses which Borrower
cannot waive.

12.11 Time of Essence. Time is of the essence for the performance of all of
Borrower’s covenants and agreements (inclusive of the Obligations) set forth in this Agreement and
each of the Loan Documents.

12.12 Amendments in Writing; Integration. All amendments to or terminations of this
Agreement must be in writing and must be executed by each party hereto. All prior agreements,
understandings, representations, warranties and negotiations between the parties hereto with
respect to the subject matter of this Agreement, if any, are merged into this Agreement and the
Loan Documents.

12.13 Counterparts. This Agreement may be executed in any number of counterparts and
by different parties on separate counterparts, each of which, when executed and delivered, shall be
deemed to be an original, and all of which, when taken together, shall constitute but one and the
same Agreement.

12.14 Survival. All covenants, representations and warranties made in this Agreement
shall continue in full force and effect so long as any Obligations remain outstanding.
Notwithstanding anything in this Agreement or the other Loan Documents to the contrary, the
obligations of Borrower to indemnify the Banks as described in Section 12.1 shall survive until all
applicable statute of limitations periods with respect to actions that may be brought against each
such Bank have run.

12.15 Limited License. During the term of this Agreement, Borrower hereby grants to
each Bank and its Affiliates, a non-exclusive, world-wide, non-transferable, royalty-free
irrevocable license to use the Borrower’s Marks (as herein defined) solely for and in connection
with the general marketing, promotion and advertising activities of such Bank and its Affiliates.
General marketing, promotion and advertising activities shall include press releases, product
brochures, tombstone ads and other advertising typical in industry practice and disclosure of
Borrower’s Marks on such Bank’s website, including a link to the Borrower’s website. “Marks” shall
mean Borrower’s names, logos, Trademarks, trade names, service marks and world wide web addresses.
Bank shall use commercially reasonable efforts to cause the appropriate designation “TM” or the
registration symbol “®” to be placed adjacent to the Marks in connection with the use thereof.
Notwithstanding the foregoing, no Bank shall be under any obligation to use any of such Marks. Any
marketing, promotion, advertising or other materials which incorporate Borrower’s Marks shall be
submitted to Borrower for approval prior to publication.

[THE NEXT PAGE IS THE SIGNATURE PAGE]

1

In witness whereof, the parties have caused this agreement to be executed with authority duly
obtained, as of the date first written above.

	 	 	 
	PORTFOLIO RECOVERY ASSOCIATES, INC.	 	 
	By:     /s/ Steven D. Fredrickson     

Steven D. Fredrickson

President and Chief Executive Officer

Portfolio Recovery Associates, Inc.

120 Corporate Boulevard, Suite 100

Norfolk, VA 23502

	 	

Witness:
	Attn: General Counsel

FAX: 757-554-0586

	 	     /s/ Kevin P. Stevenson     

Print Name: Kevin P. Stevenson
	WACHOVIA BANK, NATIONAL ASSOCIATION

	 	BANK OF AMERICA, N.A.
	By: /s/ Paula Smith

	 	By: /s/ David Doucette
	 

	 	 
	Name: Paul Smith

Title: Senior Vice President

Address for Notices:

	 	Name: David Doucette

Title: Senior Vice President

Address for Notices:
	Wachovia Bank, National Association

101 West Main Street

Mail Code VA 5263

Norfolk, VA 23510

Attn: Paula H. Smith, Senior Vice President

FAX: (757) 640-5638

	 	Bank of America, N.A.

One Commercial Place

Commercial Banking, Third Floor

Norfolk, VA 23510

Attn: Peter Schleck, Senior Vice President

FAX: (757) 441-8599
	RBC BANK (USA)

	 	SUNTRUST BANK
	By: /s/ Denise M. Howard

	 	By: /s/ Joel S. Rhew
	 

	 	 
	Name: Denise M. Howard

Title: Vice President

Address for Notices:

	 	Name: Joel S. Rhew

Title: Senior Vice President

Address for Notices:
	RBC Bank (USA)

555 E. Main Street, Suite 1000

Norfolk, VA 23510

Attn: Denise M. Howard, Vice President

FAX: (757) 892-2045

	 	SunTrust Bank

150 W. Main Street, Suite 1200

Norfolk, VA 23510

Attn: Joel S. Rhew, Senior Vice President

FAX: (757) 624-5457

Each of the undersigned, having guaranteed pursuant to Unconditional Guaranty Agreements in favor
of each Bank dated May 4, 2007, (“Guarantees”), payment and performance of the obligations of
Borrower to each Bank, hereby acknowledges and consents to the execution and delivery of this Third
Amended and Restated Loan and Security Agreement and the related Loan Documents and affirms its
obligations under the Guarantees to which it is a party.

PRA Location Services, LLC

	 	 	 
	By:

	 	/s/ Judith S. Scott
	
 
	 	 
	
 
	 	Judith S. Scott

Authorized Representative of the Sole Member

PRA Holding I, LLC

	 	 	 
	By:

	 	/s/ Judith S. Scott
	
 
	 	 
	
 
	 	Judith S. Scott

Authorized Representative of the Sole Member

Portfolio Recovery Associates, L.L.C.

	 	 	 
	By:

	 	/s/ Judith S. Scott
	
 
	 	 
	
 
	 	Judith S. Scott

Authorized Representative of the Sole Member

PRA Receivables Management, LLC

	 	 	 
	By:

	 	/s/ Judith S. Scott
	
 
	 	 
	
 
	 	Judith S. Scott

Authorized Representative of the Sole Member

PRA Government Services, LLC

	 	 	 
	By:

	 	/s/ Judith S. Scott
	
 
	 	 
	
 
	 	Judith S. Scott

Authorized Representative of the Sole Member

2

EXHIBIT A

DEFINITIONS

“Accounts” shall have a broad meaning and shall include all accounts (as such term is
defined in Article 9 of the Code) owned by the Borrower and all accounts in which the Borrower has
any rights (including, without limitation, rights to grant a security interest in accounts owned by
other persons), both now existing and hereafter owned, acquired and arising; and, to the extent not
included in the term accounts as so defined after ascribing a broad meaning thereto, all accounts
receivable, health-care-insurance receivables, credit and charge card receivables, bills,
acceptances, documents, choses in action, chattel paper (both tangible and electronic), promissory
notes and other instruments, deposit accounts, license fees payable for use of software, commercial
tort claims, letter of credit rights and letters of credit, rights to payment for money or funds
advanced or sold other than through use of a credit card, lottery winnings, rights to payment with
respect to investment property, general intangibles and other forms of obligations and rights to
payment of any nature, now owing to the Borrower and hereafter arising and owing to the Borrower,
together with (i) the proceeds of all of the accounts and other property and property rights
described hereinabove, including all of the proceeds of Borrower’s rights with respect to any of
its goods and services represented thereby, whether delivered or returned by customers, and all
rights as an unpaid vendor and lienor, including rights of stoppage in transit and of recovering
possession by any proceedings, including replevin and reclamation, and (ii) all customer lists,
books and records, ledgers, account cards, and other records including those stored on computer or
electronic media, whether now in existence or hereafter created, relating to any of the foregoing;
including, without limitation, an account established for a bank credit card, retail credit card,
consumer installment loan, defaulted auto loans or lines of credit in the name of an Account
Debtor, as set forth and described in a Purchase Agreement, and all unpaid balances due from such
Account Debtor, together with all available documents evidencing such Account Debtor’s agreement to
make payment of such unpaid balances, including without limitation each available credit card
application or agreement, and each available promissory note, receivable, obligation, chattel
paper, payment agreement, contract, installment sale agreement or other obligation or promise to
pay of an Account Debtor, all as described and referred to in a Purchase Agreement.

“Account Debtor” means any person or persons that are an obligor in any contractual
arrangement for amounts due to Borrower, Guarantors or any co-signor in respect of such contractual
arrangement.

“Advance” means an advance of borrowed funds made by the Banks to Borrower pursuant to
this Agreement.

“Affiliate” means, with respect to any person, any person that owns or controls
directly or indirectly such person, any person that controls or is controlled by or is under common
control with such person, and each of such person’s senior executive officers, directors and
partners.

“Agreement” means this Loan and Security Agreement, and any and all amendments,
modifications, renewals, extensions, replacements and substitutions thereof and therefor.

“Asset Pool” means all Receivables and other Assets, as the context may require, which
Receivables shall all have been purchased from a single creditor and from which Borrower or
Guarantor have purchased such Receivables on the same Business Day, together with (i) each and
every Asset obtained in replacement or satisfaction of or substitution for, any such Receivable so
purchased, (ii) each and every item of property obtained by Borrower or Guarantor as a result of
its collection activities with respect to any such purchased Receivable, (iii) each and every item
of collateral or security, including all security interests, liens, guarantees and other interests
securing payment of any purchased Receivable, and all other rights and interests of Borrower or
Guarantor with respect to each purchased Receivable, (iv) each judgment rendered against a
purchased Account Debtor in respect to a Receivable, together with all lien rights related thereto,
(v) Asset Pool Proceeds derived from or paid or payable with respect thereto, together with any and
all earnings thereon, and (vi) each and every other right, claim and interest associated therewith.
With respect to an Asset Pool: (a) the term “Receivable” shall mean a purchased account
established for a bank credit card, retail credit card, consumer installment loan, defaulted auto
loans or lines of credit in the name of an Account Debtor, as set forth and described in a Purchase
Agreement, and all unpaid balances due from such Account Debtor, together with (to the extent
available) all documents evidencing such Account Debtor’s agreement to make payment of such unpaid
balances, including, without limitation, each credit card application or agreement, and each
promissory note, receivable, obligation, chattel paper, payment agreement, contract, installment
sale agreement or other obligation or promise to pay of an Account Debtor, all as described and
referred to in a Purchase Agreement; and (b) the term “Asset” shall mean each purchased Receivable
and any property or other right obtained by Borrower in connection with collection of any such
purchased Receivable or in substitution therefor, all of which constitutes part of the Asset Pool
into which such purchased Receivable was initially delivered.

“Asset Pool Proceeds” means, with respect to an Asset Pool, any and all payments,
revenues, income, receipts, collections, recoveries and other proceeds or assets received with
respect to such Asset Pool, including, without limitation, (i) payments of principal, interest,
fees, late charges, insufficient funds charges, guaranty payments and any interest thereon, credit
insurance costs, guaranty fees and other amounts recovered on account of any Asset in such Asset
Pool, and (ii) settlements, compromises, liquidations, foreclosure proceeds, dispositions, sales,
transfers or other proceeds, whether cash or otherwise, received as a result of or in any way in
connection with collection activities related to any Asset or in connection with the sale of any
Asset constituting a part of such Asset Pool.

“Asset Pool Report” means a report, in a form and substance acceptable to the Banks,
that sets forth each Asset Pool purchased by Borrower in a form reasonably acceptable to the Banks
and that identifies the Eligible Asset Pools.

“Asset Pool Seller” means, with respect to an Asset Pool, the party which has agreed
to sell a specified Asset Pool to Borrower or any Guarantor pursuant to the terms of a Purchase
Agreement.

“Bank Expenses” means all costs and expenses incurred and suffered by the Banks, or
any of them, in connection with the preparation, negotiation, administration and enforcement of the
Loan Documents and their rights and remedies thereunder, including, without limitation, perfection,
audit, inspection, protection and enforcement of the Banks’ security interests in the Collateral.

“Banks” means Wachovia Bank, National Association, Bank of America, N.A., RBC Bank
(USA), SunTrust Bank, and such other lenders or financial institutions as may become party to this
Agreement as lenders pursuant to the terms hereof, and their permitted successors, assigns,
transferees and the holder of this Agreement and the other Loan Documents, and “Bank” means any of
them.

“Borrower” means Portfolio Recovery Associates, Inc., a Delaware corporation, and its
successors and permitted assigns.

“Borrower’s Books” means all of Borrower’s books and records including, without
limitation, ledgers, journals, spread sheets, business plans, business projections, tax returns and
accompanying worksheets and notes related thereto, governmental and regulatory filings and reports
and all other records concerning Borrower’s assets and liabilities, the Collateral, business
operations and financial condition; and the term includes media on which such records are stored or
maintained, whether electronic, printed, imbedded in software or other computer programs or on tape
files, and the equipment containing such information.

“Borrowing Base” means an amount equal to 30% of Estimated Remaining Collections of
all Eligible Asset Pools, as determined by Bank with reference to the most recent Borrowing Base
Report delivered by Borrower.

“Borrowing Percentage” means, with respect to any Bank, the ratio of such Bank’s
Commitment to the aggregate of all the Banks’ Commitments hereunder.

“Business Day” means any day that is not a Saturday, Sunday or other day on which
banks in the Commonwealth of Virginia are authorized or required to close.

“Capitalized Leases” means all leases that have been or should be, in accordance with
GAAP, recorded as capitalized leases.

“Certificate of Borrower” means that certain Certificate of Borrower dated as of the
date hereof, executed by Borrower and delivered to the Banks in connection with this Agreement
with respect to certain representations, warranties, resolutions and organizational matters.

“Change in Management” shall mean Kevin P. Stevenson and Steven D. Fredrickson are no
longer Chief Financial Officer and President or Chief Executive Officer of Borrower, respectively.

“Close” or “Closing” means the completion of the conditions precedent to the
initial Credit Extension.

“Closing Date” means the date of this Agreement.

“Code” means the Uniform Commercial Code as in effect, from time to time, in the
Commonwealth of Virginia.

“Collateral” means the property and property rights described on Exhibit C and
all Negotiable Collateral and Intellectual Property Collateral to the extent not described on
Exhibit C.

“Commitment” means, with respect to any Bank, the dollar amount of the commitment made
by such Bank to Borrower pursuant to this Agreement. For the avoidance of doubt, (i) the initial
Commitment of Bank of America, N.A., shall be $130,001,000, under the Revolving Facility and
$37,451,294 under the Non-Revolving Sublimit, (ii) the initial Commitment of Wachovia Bank,
National Association, shall be $100,000,000 under the Revolving Facility and $33,039,382 under the
Non-Revolving Sublimit, (iii) the initial Commitment of RBC Bank (USA) shall be $39,999,000 under
the Revolving Facility and $19,215,206 under the Non-Revolving Sublimit, and (iv) the initial
Commitment of SunTrust Bank shall be $70,000,000 under the Revolving Facility and $10,294,118 under
the Non-Revolving Sublimit.

“Committed Line” means Credit Extensions under the Revolving Facility and the
Non-Revolving Sublimit of up to the lesser of: (i) Three Hundred Forty Million Dollars
($340,000,000) and (ii) thirty percent (30%) of Borrower’s and Portfolio Recovery Associates,
L.L.C.’s Estimated Remaining Collections of all Eligible Asset Pools.

“Contingent Obligation” or “Contingent Liabilities” means, as applied to any person,
any direct or indirect liability, contingent or otherwise, of that person with respect to (i) any
account, instrument, chattel paper, document, general intangible, indebtedness, lease, dividend,
letter of credit, letter of credit right or other obligation of another person, including, without
limitation, any such obligation directly or indirectly guaranteed, endorsed, co-made or discounted
or sold with recourse by that person, or in respect of which that person is otherwise directly or
indirectly liable; (ii) any obligations with respect to undrawn letters of credit issued for the
account of that person; and (iii) all obligations arising under any interest rate, currency or
commodity swap agreement, interest rate cap agreement, interest rate collar agreement, or other
agreement or arrangement designated to protect a person against fluctuation in interest rates,
currency exchange rates or commodity prices; provided, however, that the term “Contingent
Obligation” shall not include endorsements for collection or deposit in the ordinary course of
business. The amount of any Contingent Obligation shall be deemed to be an amount equal to the
stated or determined amount of the primary obligation in respect of which such Contingent
Obligation is made or, if not stated or determinable, the maximum reasonably anticipated liability
in respect thereof as determined by such person in good faith; provided, however, that such amount
shall not in any event exceed the maximum amount of the obligations under the guarantee or other
support arrangement.

“Copyrights” means any and all copyright rights, copyright applications, copyright
registrations and like protections in each work of authorship and derivative work thereof, both
published and unpublished and whether or not the same also constitutes a trade secret, now existing
and hereafter arising, created, acquired or held.

“Credit Extension” means each Advance, or any other extension of credit by any Bank
for the benefit of Borrower hereunder.

“Default Rate” means a rate of interest per annum equal to the contract rate of
interest defined as the “Default Rate” in the Promissory Note, and if there is more than one
Promissory Note, it shall mean a rate of interest per annum equal to the highest of the contract
rates of interest defined in the Promissory Notes as a “Default Rate”.

“EBITDA” means net income, less income or plus loss from discontinued operations and
extraordinary items, plus income taxes, plus interest expense, plus depreciation, depletion,
amortization (including payments applied to principal on finance receivables) and other non-cash
charges.

“Eligible Asset Pool” means those existing Asset Pools accepted by the Banks at
Closing and newly acquired Asset Pools of Borrower and Portfolio Recovery Associates, L.L.C.
acquired from Asset Pool Sellers not affiliated with the Borrower or Guarantor, that in each case,
meet all of the following requirements:

(i) the Accounts in such Asset Pool, taken as a whole, comply in all material respects with
all applicable laws and regulations, including, but not limited to, truth in lending and credit
disclosure laws and regulations;

(ii) all amounts and information appearing on the applicable Asset Pool Report furnished to
the Banks in connection therewith are true and correct in all material respects;

(iii) Borrower or Portfolio Recovery Associates, L.L.C. has good and marketable title and has
the right to pledge, assign and deliver the Assets of such Asset Pool, free from all liens, claims,
encumbrances or security interests whatsoever;

(iv) no more than one percent (1%) of the number of Accounts in such Asset Pool constitute
Accounts with respect to which the Account Debtor thereon or any guarantor thereof is employed by
or related to Borrower or any Guarantor or is Borrower or any Guarantor;

(v) to the best knowledge of Borrower and Guarantor no condition exists that materially or
adversely affects the Level Yield of the Asset Pool; and

(vi) since the acquisition of the Asset Pool by Borrower or Portfolio Recovery Associates,
L.L.C., no sale of any Account within the Asset Pool has occurred except arms length sales to
non-affiliated third parties.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from
time to time, and the regulations promulgated and rulings issued thereunder.

“ERISA Affiliate” means any Person that for purposes of Title IV of ERISA is a member
of the Borrower’s controlled group, or under common control with the Borrower, within the meaning
of Section 414 of the Internal Revenue Code or Section 4001 of ERISA.

“ERISA Event” means (a)(i) the occurrence of a reportable event, within the meaning of
Section 4043 of ERISA, with respect to any Plan unless the 30-day notice requirement with respect
to such event has been waived by the PBGC, or (ii) the requirements of subsection (1) of Section
4043(b) of ERISA (without regard to subsection (2) of such Section) are met with respect to a
contributing sponsor, as defined in Section 4001(a)(13) of ERISA, of a Plan, and an event described
in paragraph (9), (10), (11), (12) or (13) of Section 4043(c) of ERISA is reasonably expected to
occur with respect to such Plan within the following 30 days; (b) the application for a minimum
funding waiver with respect to a Plan; (c) the provision by the administrator of any Plan of a
notice of intent to terminate such Plan pursuant to Section 4041(a)(2) of ERISA (including any such
notice with respect to a plan amendment referred to in Section 4041(e) of ERISA); (d) the cessation
of operations at a facility of the Borrower or any ERISA Affiliate in the circumstances described
in Section 4062(e) of ERISA; (e) the withdrawal by the Borrower or any ERISA Affiliate from a
Multiple Employer Plan during a plan year for which it was a substantial employer, as defined in
Section 4001(a)(2) of ERISA; (f) the conditions for the imposition of a lien under Section 302 of
ERISA shall have been met with respect to any Plan; (g) the adoption of an amendment to a Plan
requiring the provision of security to such Plan pursuant to Section 307 of ERISA; (h) the
institution by the PBGC of proceedings to terminate a Plan pursuant to Section 4042 of ERISA, or
the occurrence of any event or condition described in Section 4042 of ERISA that constitutes
grounds for the termination of, or the appointment of a trustee to administer, a Plan; or
(i)(A) the IRS or the United States Department of Labor determines that a breach of fiduciary duty
under ERISA or a prohibited transaction under ERISA or the IRC has occurred with respect to the
Borrower or any ERISA Affiliate and neither the Borrower nor any ERISA Affiliate contests such
determination, or (B) a court of competent jurisdiction enters a final, non-appealable order
determining that a breach of fiduciary duty under ERISA or a prohibited transaction under ERISA or
the IRC has occurred with respect to the Borrower or any ERISA Affiliate.

“Estimated Remaining Collections” means the aggregate gross remaining cash collections
which Borrower or Portfolio Recovery Associates, L.L.C. anticipate to receive from an Asset Pool or
as referred to by Borrower or Portfolio Recovery Associates, L.L.C. as the “Level Yield,”
determined and reported by Borrower or Portfolio Recovery Associates, L.L.C. pursuant to their
financial statements and other reporting to the Banks. Such remaining book balance shall be
calculated by Borrower or Portfolio Recovery Associates, L.L.C. (as the case may be) in accordance
with GAAP and in a manner consistent with past practice and with the methodology employed in the
reporting of Estimated Remaining Collections in Borrower’s public filings. Provided, however, the
manner and method of computing Estimated Remaining Collections and all assumptions made in
connection therewith shall be explained to each Bank in full detail upon any Bank’s request. Any
deviation from the current method and assumptions used in computing Estimated Remaining Collections
must be acceptable to each Bank in its sole and absolute discretion.

“Event of Default” has the meaning assigned in Section 8.

“Funded Debt” means all outstanding liabilities for borrowed money and other
interest-bearing liabilities, including current and long-term debt, less the non-current portion of
Subordinated Liabilities. 

“Funded Debt to EBITDA Ratio” means, on a consolidated basis, a ratio of Funded Debt
to EBITDA. This ratio will be calculated at the end of each reporting period for which the Banks
require financial statements from Borrower, using the results of the twelve-month period ending
with that reporting period. 

“GAAP” means generally accepted accounting principles and practices in effect in the
United States from time to time as promulgated by the American Institute of Certified Public
Accounts.

“Guarantor” means Portfolio Recovery Associates, L.L.C., PRA Holding I, LLC, PRA
Location Services, LLC, PRA Government Services, LLC, PRA Receivables Management, LLC, PRA Holding
II, LLC, and PRA Bankruptcy Services, LLC jointly and severally.

“Governmental Authority” means any nation or government, any state or other political
subdivision thereof, and any organization exercising executive, legislative, judicial, regulatory
or administrative functions of or pertaining to government.

“Indebtedness” means (a) all liabilities which would be reflected on a balance sheet
prepared in accordance with GAAP, (b) all indebtedness for borrowed money or the deferred purchase
price of property or services, including without limitation reimbursement and other obligations
with respect to surety bonds and letters of credit, (c) all obligations evidenced by notes, bonds,
debentures or similar instruments, (d) all capital lease obligations and (e) all Contingent
Obligations.

“Insolvency Proceeding” means any proceeding commenced by or against any person or
entity under any provision of the United States Bankruptcy Code, as amended, or under any other
bankruptcy or insolvency law, including assignments for the benefit of creditors, formal or
informal moratoria, compositions, extension generally with its creditors, or proceedings seeking
reorganization, arrangement or other relief.

“Intellectual Property Collateral” means all of Borrower’s right, title and interest
in and to its intellectual property, including without limitation, the following: (i) Copyrights,
Trademarks and Patents; (ii) any and all trade secrets, and any and all intellectual property
rights in software and software products now or hereafter existing, created, acquired or held
during the term of this Agreement; (iii) any and all design rights which may be available to
Borrower now or hereafter existing, created, acquired or held during the term of this Agreement;
(iv) any and all mask works or similar rights now or hereafter existing, created, acquired or held
during the term of this Agreement; (v) any and all claims for damages by way of past, present and
future infringement of any of the rights included above, with the right, but not the obligation, to
sue for and collect such damages for said use or infringement of the intellectual property rights
identified above; (vi) all licenses or other rights to use any of the Copyrights, Patents or
Trademarks, and all license fees and royalties arising from such use to the extent permitted by
such license or rights; (vii) all amendments, renewals, re-issues, divisions, continuations and
extensions of any of the Copyrights, Trademarks or Patents; and (viii) all proceeds and products of
the foregoing, including without limitation all payments under insurance or any indemnity or
warranty payable in respect of any of the foregoing.

“Intercreditor Agreement” means that certain Intercreditor Agreement of even date
herewith, by and between the Banks, and any successor instrument thereto with respect to the
relative rights and interests of the Banks in and to the Collateral.

“Interest Expense” means the total of the costs of advances outstanding under
Indebtedness including (i) interest charges, (ii) capitalized interest, (iii) the interest
component of Capitalized Leases, (iv) fees payable in respect of letters of credit and letters of
guarantee, and (v) discounts incurred and fees payable in respect of bankers’ acceptances.

“Investment” means any beneficial ownership of (including stock, membership interest,
partnership interest or other securities) any person, or any loan, advance or capital contribution
to any person.

“IRC” means the Internal Revenue Code of 1986, as amended, and the regulations
thereunder.

“IRS” means the United States Internal Revenue Service.

“Knowledge” means actual knowledge or such level of knowledge or awareness as would be
obtained or should have been known at the time by a prudent business person under substantially
similar circumstance after diligent investigation.

“Lien” means any mortgage, lien, deed of trust, deed to secure debts, charge, pledge,
security interest or other encumbrance and the term “security interest” and Lien shall be
interchangeable, as necessary or appropriate.

“Loan Documents” means, collectively, this Agreement, the Intercreditor Agreement, any
instruments, including promissory notes, executed and delivered by Borrower to any Bank, and any
one or more of the following entered into by Borrower and any Bank, or by Borrower for the benefit
of any Bank, or by another person and any Bank or by another person for benefit of any Bank, in
connection with the Agreement or any of the Obligations, together with any and all renewals,
extensions, amendments, modifications, replacements and substitutions thereof and therefor:
mortgages, deeds to secure debt, deeds of trust, security agreements, negative pledge agreements,
pledge agreements, guaranty agreements, control agreements, hypothecation agreements, documents,
agreements and other records.

“Material Adverse Effect” means a material adverse effect on (i) the business
operations or condition (financial or otherwise) of Borrower and its Subsidiaries taken as a whole
or (ii) the ability of Borrower to repay the Obligations or otherwise perform its obligations under
the Loan Documents as and when required thereunder.

“Material Agreements” has the meaning assigned in the Certificate of Borrower.

“Multiple Employer Plan” means a single employer plan, as defined in Section
4001(a)(15) of ERISA, that (a) is maintained for employees of the Borrower or any ERISA Affiliate
and at least one Person other than the Borrower and the ERISA Affiliates or (b) was so maintained
and in respect of which the Borrower or any ERISA Affiliate could have liability under Section 4064
or 4069 of ERISA in the event such plan has been or were to be terminated.

“Negotiable Collateral” means all of Borrower’s present and future letters-of-credit
and letter-of-credit rights of which it is a beneficiary, instruments (including promissory notes),
drafts, securities, documents of title and chattel paper (including electronic chattel paper), and
Borrower’s Books relating to any of the foregoing.

“Net Finance Receivable” means the remaining book balance of Borrower’s or a
Guarantor’s net investment in all Asset Pools or as referred to by Borrower as the “unamortized
portfolio price”, determined and reported by Borrower pursuant to its consolidated financial
statements and other reporting provided to the Banks. Such remaining book balance shall be
calculated by Borrower in accordance with GAAP and in a manner consistent with past practice and
with the manner of calculation of Net Finance Receivable in Borrower’s public filing and such
amount shall be consistent with the amount actually reported in Borrower’s public filings.

“Net Income” means total revenues minus total expenses.

“Non-Revolving Sublimit” means the portion of the Revolving Facility available to
Borrower for non-revolving fixed rate borrowings in the aggregate amount not to exceed
$100,000,000.00.

“Non-Revolving Maturity Date” means May 4, 2012 or such later date to which all the
Banks may agree in their sole and absolute discretion.

“Obligations” means all indebtedness, including principal, interest, fees, premiums,
penalties, charges, Bank Expenses and other amounts owed to any Bank by Borrower pursuant to this
Agreement, the other Loan Documents and any other agreement, document and record, both absolute and
contingent, due and to become due, now existing and hereafter arising, including any interest and
fees that accrue after the commencement of an Insolvency Proceeding and including any indebtedness,
liability and obligation now owing and any indebtedness, liability and obligation hereafter arising
and owing from Borrower to others that any Bank has obtained or may in the future obtain by
assignment or otherwise.

“Patents” means all patents, patent applications and like protections including
without limitation improvements, divisions, continuations, renewals, reissues, extensions and
continuations-in-part of the same.

“PBGC” means the Pension Benefit Guaranty Corporation (or any successor).

“Periodic Payments” means all installment and similar recurring payments that Borrower
may now be obligated to pay and may hereafter become obligated to pay to the Banks, or any of them,
pursuant to the terms and provisions of any instrument, agreement, document and record now in
existence and which may hereafter come into existence between Borrower and any Bank.

“Permitted Acquisitions” means acquisitions of all or substantially all of the assets
or 100% of the capital stock of another entity (the “Acquired Business”) (including by (i) merger
of the Acquired Business with Borrower or a Subsidiary of Borrower so long as the survivor of such
merger is, or becomes at such time, a Guarantor and pledges on a first priority basis all its
assets to secure the Obligations in the same manner as the other Guarantors, although in the case
of any such merger which involves Borrower, Borrower shall be the surviving corporation or (ii)
means of a joint venture where Borrower or a Subsidiary owns at least fifty percent (50%) of the
equity interests of such joint venture), provided that the sum of the aggregate cash
consideration plus the aggregate fair market value of all other consideration paid by Borrower or
its Subsidiaries (including any indebtedness issued, incurred or assumed by Borrower or any of its
Subsidiaries and any capital stock, issued by Borrower) in connection with any Permitted
Acquisitions in any Borrower fiscal year shall not exceed in the aggregate Thirty Million Dollars
($30,000,000), without the prior written consent of all Banks.

“Permitted Dividends” means dividends lawfully declared and paid which (i) would not
cause a breach of this Agreement if paid, (ii) do not exceed in the aggregate Twenty Million
Dollars ($20,000,000) in any Borrower fiscal year, and (iii) would not have resulted in a breach of
Borrower’s Funded Debt to EBITDA ratio or minimum Tangible Net Worth had the dividend been declared
and paid on the last day of the most recent month.

“Permitted Indebtedness” means: (i) Indebtedness of Borrower in favor of the Banks
arising under this Agreement or any other Loan Document; (ii) Indebtedness existing on the Closing
Date which is disclosed in the Schedule; (iii) Indebtedness not to exceed in the aggregate in any
fiscal year 2% of Borrower’s Tangible Net Worth secured by a lien described in clause (iii) of the
defined term “Permitted Liens”, provided such Indebtedness does not exceed the lesser of the cost
or fair market value of the Equipment financed with such Indebtedness and provided Borrower gives
the Banks right of first refusal to provide such financing; (iv) Subordinated Liabilities; (v)
Indebtedness of Borrower in connection with Capitalized Leases with any Bank or any Affiliate of
any Bank; and (vi) Indebtedness of Borrower owed to any Bank or any Affiliate of any Bank in
connection with any credit card, commercial paper or interest rate protection agreement or program.

“Permitted Investment” means: (i) Investments existing on the Closing Date disclosed
in the Certificate of Borrower; (ii) (A) marketable direct obligations issued or unconditionally
guaranteed by the United States of America or any agency or any State thereof maturing within one
year from the date of acquisition thereof, (B) commercial paper maturing no more than one year from
the date of creation thereof and currently having a rating of at least A-2 or P-2 from either
Standard & Poor’s Corporation or Moody’s Investors Service, (C) certificates of deposit maturing no
more than one year from the date of investment therein issued by a Bank, and (D) any Bank’s money
market accounts; (iii) Investments accepted in connection with Permitted Transfers; (iv)
Investments consisting of (A) travel advances and employee relocation loans and other employee
loans and advances in the ordinary course of business, and (B) loans to employees, officers or
directors relating to the purchase of equity securities of Borrower or its Subsidiaries pursuant to
employee stock purchase plan agreements approved by Borrower’s board of directors; (v) Investments
(including debt obligations) received in connection with the bankruptcy or reorganization of
customers or suppliers and in settlement of delinquent obligations of, and other disputes with,
customers or suppliers arising in the ordinary course of Borrower’s business; (vi) Investments
consisting of notes receivable of, or prepaid royalties and other credit extensions, to customers
and suppliers who are not Affiliates, in the ordinary course of business; and (vii) repurchase of
stock of the Borrower, except that a repurchase shall only be permitted if, at the time of the
repurchase, such repurchase amount, when combined with other repurchases in the prior twelve (12)
month period does not exceed One Hundred Million Dollars ($100,000,000) and if, at the time of the
repurchase, no Event of Default has occurred, is continuing or would exist after giving effect to
the repurchase.

“Permitted Liens” means the following: (i) any Liens existing on the Closing Date and
disclosed in the Schedule or arising under this Agreement or the other Loan Documents; (ii) Liens
for taxes, fees, assessments or other governmental charges or levies, either not delinquent or
being contested in good faith by appropriate proceedings and for which Borrower maintains adequate
reserves, provided the same have no priority over any of the Banks’ security interests; (iii) Liens
securing the Indebtedness not to exceed the amount described in (iii) of the definition of
Permitted Indebtedness (A) upon or in any Equipment acquired or held by Borrower or any of its
Subsidiaries to secure the purchase price of such Equipment or indebtedness incurred solely for the
purpose of financing the acquisition of such Equipment, or (B) existing on such Equipment at the
time of its acquisition, provided that the Lien is confined solely to the property so acquired and
improvements thereon, and the proceeds of such Equipment, provided that, to the extent not
specifically prohibited by the terms of such financings, Borrower shall grant and pledge to the
Banks a valid, perfected security interest which is second in priority to any lien granted under
this provision; and (iv) Liens incurred in connection with the extension, renewal or refinancing of
the indebtedness secured by Liens of the type described in clauses (i) through (iii) above,
provided that any extension, renewal or replacement Lien shall be limited to the property
encumbered by the existing Lien and the principal amount of the indebtedness being extended,
renewed or refinanced does not increase.

“Permitted Transfer” means the conveyance, sale, lease, transfer or disposition by
Borrower or any Subsidiary of: (i) Assets, Accounts or Inventory in the ordinary course of
business and in the ordinary course of portfolio management, which may include sales from
portfolios acquired under joint bids where the Borrower is the lead purchaser; (ii) non-exclusive
licenses and similar arrangements for the use of the property of Borrower or its Subsidiaries in
the ordinary course of business; (iii) surplus, worn-out or obsolete Equipment, or (iv) the capital
stock of Borrower for fair market value.

“Plan” means a Single Employer Plan or a Multiple Employer Plan.

“Postponed Debt” means the total Indebtedness that is fully postponed and
subordinated, on terms satisfactory to the Banks, to the obligations owing to the Banks.

“Promissory Note” means any promissory note or other instrument of Borrower in favor
of any Bank evidencing any indebtedness of Borrower to any Bank under this Agreement or evidencing
any of the other Obligations, together with any amendments, modifications, extensions, renewals,
substitutions or replacements thereto or therefor.

“Pro Rata” means, with respect to a Bank as of any date of determination, such Bank’s
allocable portion of outstanding Credit Extensions under the Revolving Facility and the
Non-Revolving Sublimit expressed as a fraction, the numerator of which is such Bank’s total
outstanding Credit Extensions and the denominator of which is the aggregate of all outstanding
Credit Extensions under this Agreement, as of such date of determination.

“Purchase Agreement” means the agreement between Borrower or any Guarantor and any
Asset Pool Seller for the purchase of an Asset Pool.

“Purchase Price” shall mean the actual purchase price paid by Borrower or a Guarantor
for an Asset Pool, pursuant to the terms of a Purchase Agreement.

“Requirement of Law” means as to any person, the certificate of incorporation and
by-laws or other organizational or governing documents of such person, and any law, treaty, rule,
or regulation, or determination of an arbitrator or a court or other Governmental Authority, in
each case applicable to or binding upon such person or any of its properties or to which such
person or any of its properties is subject, either individually, or jointly or collectively with
another person or persons.

“Responsible Officer” means each of the Chief Executive Officer, the Chief Operating
Officer, the Chief Financial Officer and the Controller of Borrower.

“Revolver Maturity Date” means May 2, 2011, or any extension thereof pursuant to
Section 2.7 hereof.

“Revolving Facility” means the facility under which Borrower may request the Banks to
issue Advances, as specified in Section 2 under subsection entitled “Revolving Facility”.

“Schedule” means the schedule of exceptions attached hereto, if any.

“Shareholders’ Equity” means the total of (i) share capital (excluding redeemable
preferred shares and treasury stock), (ii) contributed surplus, (iii) retained earnings and (iv)
Postponed Debt; and for non-corporate organizations such as partnerships or limited liability
companies, equity accounts similar to those described herein for corporations.

“Single Employer Plan” means a single employer plan, as defined in Section 4001(a)(15)
of ERISA, that (a) is maintained for employees of the Borrower or any ERISA Affiliate and no Person
other than the Borrower and the ERISA Affiliates or (b) was so maintained and in respect of which
the Borrower or any ERISA Affiliate could have liability under Section 4069 of ERISA in the event
such plan has been or were to be terminated.

“Software Products” and “Software” are interchangeable and mean software,
computer source codes and other computer programs.

“Subordinated Liabilities” means liabilities subordinated to Borrower’s obligations to
the Banks in a manner acceptable to the Banks in each Bank’s sole discretion.

“Subsidiary” means any registered organization or other organization (1) the majority
(by number of votes) of the outstanding voting interests of which is at the time owned or
controlled by Borrower, or by one or more Subsidiaries of Borrower, or Borrower and one or more
Subsidiaries of Borrower, or (2) otherwise controlled by or within the control of Borrower or any
Subsidiary.

“Tangible Net Worth” means the value of Borrower’s total assets (including leaseholds
and leasehold improvements and reserves against assets but excluding goodwill, patents, trademarks,
trade names, organization expense, unamortized debt discount and expense, capitalized or deferred
research and development costs, deferred marketing expenses, and other like intangibles, and monies
due from affiliates, officers, directors, employees, shareholders, members or managers of Borrower)
less total liabilities, including but not limited to accrued and deferred income taxes, but
excluding the non-current portion of Subordinated Liabilities.

“Total Liabilities” or “Total Debt “ means all liabilities, including Contingent
Liabilities, exclusive of deferred tax liabilities and Postponed Debt.

“Trademarks” means any trademark and service mark rights, whether registered or not,
applications to register and registrations of the same and like protections, and the entire
goodwill of the business of Borrower connected with and symbolized by such trademarks.

“Unused Facility” means an amount equal to the Committed Line then in effect less the
aggregate amount of Advances outstanding under the Revolving Facility and the Non-Revolving
Sublimit and any other deductions from the Committed Line as provided in the Agreement.

3

EXHIBIT B

	 	 	 	 	 
	LOAN PAYMENT/ADVANCE REQUEST FORM
	 	 
	DEADLINE FOR SAME DAY PROCESSING IS 10:00 A.M., E.T.
	 	 
	TO:      

	 	and
	 	DATE:
	
 
	 	 
	 	

	FAX #:     

	 	and
	 	TIME:
	
 
	 	 
	 	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	FROM:

	 	

	 	

	 	

	 	

	 	

	CLIENT NAME (BORROWER)

	 	

	 	

	 	

	 	

	 	

	REQUESTED BY:

	 	

	 	

	 	

	 	

	 	

	AUTHORIZED SIGNATURE:

	 	

	 	

	 	

	 	

	 	

	PHONE NUMBER:

	 	

	 	

	 	

	 	

	 	

	FROM BANK OF AMERICA ACCT #	 	 	 	TO ACCOUNT #	 	 	 	 	 	 	 	 
	FROM WACHOVIA ACCT #	 	 	 	TO ACCOUNT #	 	 	 	 	 	 	 	 
	FROM RBC BANK (USA) ACCT #	 	 	 	TO ACCOUNT #	 	 	 	 	 	 	 	 
	FROM SUNTRUST BANK ACCT#	 	 	 	TO ACCOUNT #	 	 	 	 	 	 	 	 
	CHECK ONE: ?Revolving Facility	 	?Non-Revolving Sublimit	 	 	 	 	 	 	 	 
	REQUESTED TRANSACTION TYPE	 	 	 	 	 	 	 	REQUEST DOLLAR AMOUNT	 	 	 	 
	 	 	 
	
 
	 	Bank of

America
	 	

	 	Wachovia Bank

	 	RBC Bank (USA)

	 	SunTrust Bank

	PRINCIPAL INCREASE (ADVANCE)

	 	 	 	 	$	 	 	 	$	 	 	 	$	 	 	 	$	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	PRINCIPAL PAYMENT (ONLY)

	 	 	 	 	$	 	 	 	$	 	 	 	$	 	 	 	$	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	INTEREST PAYMENT (ONLY)

	 	 	 	 	$	 	 	 	$	 	 	 	$	 	 	 	$	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	PRINCIPAL AND INTEREST (PAYMENT)

	 	 	 	 	$	 	 	 	$	 	 	 	$	 	 	 	$	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	OTHER INSTRUCTIONS:

	 	

	 	

	 	

	 	

	 	

	All representations and warranties of Borrower stated in the Loan and Security Agreement are true, correct and

	complete in all respects as of the date of this Loan Payment/Advance Request; provided, however, that those

	representations and warranties expressly referring to another date shall be true, correct and complete as of such

	date.

	 	

	 	

	 	

	 	

	 	

	BANK USE ONLY

	 	

	 	

	 	

	 	

	 	

	TELEPHONE REQUEST:

	 	

	 	

	 	

	 	

	 	

	 

	 	

	 	

	 	

	 	

	 	

	The following person is authorized to request the loan payment transfer/loan advance on the advance designated

	account and is known to me.

	 	

	 	

	 	

	 	

	 	

	Authorized Requester

	 	 	 	 	 	 	 	 	 	 	 	Phone #
	 	

	Received By (Bank)

	 	 	 	 	 	 	 	 	 	 	 	Phone #
	 	

	Authorized Signature (Bank)

	 	

	 	

	 	

	 	

	 	

	 

	 	

	 	

	 	

	 	

	 	

4

EXHIBIT C

	 	 	 
	DEBTOR:

SECURED PARTIES:

	 	PORTFOLIO RECOVERY ASSOCIATES, INC.

BANK OF AMERICA, N.A. WACHOVIA BANK, NATIONAL ASSOCIATION,

RBC BANK (USA), SUNTRUST BANK

COLLATERAL DESCRIPTION ATTACHMENT TO LOAN AND SECURITY AGREEMENT

All personal property owned by Borrower and all personal property in which Borrower has a property
interest, both presently existing and hereafter created, written, produced, developed, acquired and
arising, of every nature, kind and description, wherever located and notwithstanding in whose
custody and possession any of the foregoing may be at any time or times, including, but not limited
to:

	(i)	 	all accounts (as such term is defined in Article 9 of the Uniform Commercial Code in effect
from time to time in the Commonwealth of Virginia) owned by the Borrower and all accounts in
which the Borrower has any rights (including, without limitation, rights to grant a security
interest in accounts owned by other persons), both now existing and hereafter owned, acquired
and arising and, to the extent not included in the term accounts as so defined after ascribing
a broad meaning thereto, all accounts receivable, health-care-insurance receivables, credit
and charge card receivables, bills, acceptances, documents, choses in action, chattel paper
(both tangible and electronic), promissory notes and other instruments, deposit accounts,
license fees payable for use of software, commercial tort claims, letter of credit rights and
letters of credit, rights to payment for money or funds advanced or sold other than through
use of a credit card, lottery winnings, rights to payment with respect to investment property,
general intangibles and other forms of obligations and rights to payment of any nature, now
owing to the Borrower and hereafter arising and owing to the Borrower, together with (1) the
proceeds of all of the accounts and other property and property rights described hereinabove,
including all of the proceeds of Borrower’s rights with respect to any of its goods and
services represented thereby, whether delivered or returned by customers, and all rights as an
unpaid vendor and lienor, including rights of stoppage in transit and of recovering possession
by any proceedings, including replevin and reclamation, and (2) all customer lists, books and
records, ledgers, account cards, and other records including those stored on computer or
electronic media, whether now in existence or hereafter created, relating to any of the
foregoing; including, without limitation, any account established for a bank credit card,
retail credit card, consumer installment loan, defaulted auto loans or lines of credit in the
name of an Account Debtor, as set forth and described in a Purchase Agreement, and all unpaid
balances due from such Account Debtor, together with all available documents evidencing such
Account Debtor’s agreement to make payment of such unpaid balances, including without
limitation each available credit card application or agreement, and each available promissory
note, receivable, obligation, chattel paper, payment agreement, contract, installment sale
agreement or other obligation or promise to pay of an Account Debtor, all as described and
referred to in a Purchase Agreement, together with any property or other right obtained by
Borrower in connection with collection of any account or in substitution therefor, all of
which constitutes a part of the Asset Pool into which such Account was initially delivered;

	(ii)	 	all now existing and hereafter acquired Asset Pools and Asset Pool Proceeds, as defined in
this Agreement;

	(iii)	 	all rights in and to each Purchase Agreement, as defined in this Agreement;

	(iv)	 	all now existing and hereafter acquired software, computer source codes, computer programs
embedded in goods that consist solely of the medium in which the program is embedded and other
computer programs and supporting information (collectively, the “Software Products”), and all
common law and statutory copyrights and copyright registrations, applications for
registration, now existing and hereafter arising, United States of America and foreign,
obtained and to be obtained on or in connection with the Software Products, and any parts
thereof and any underlying and component elements of the Software Products, together with the
right to copyright and all rights to renew and extend such copyrights and the right (but not
the obligation) of Bank to sue in its own name and in the name of the Borrower for past,
present and future infringements of copyright;

	(v)	 	all now existing and hereafter acquired goods, including, without limitation, fixtures,
equipment and inventory;

	(vi)	 	all now existing and hereafter arising rights in oil, gas or other minerals before
extraction;

	(vii)	 	all now existing and hereafter arising guarantees and other supporting obligations, together
with the security therefor;

	(viii)	 	all now existing and hereafter arising copyrights, trade secrets, trademarks, service marks,
trade names and service names and the goodwill associated therewith;

	(ix)	 	all now existing and hereafter arising (a) patents and patent applications filed in the
United States Patent and Trademark Office or any similar office of any foreign jurisdiction,
and interests under patent license agreements, including, without limitation, the inventions
and improvements described and claimed therein, (b) licenses pertaining to any patent whether
Borrower is licensor or licensee, (c) income, royalties, damages, payments, accounts and
accounts receivable now due and those hereafter arising and due under and with respect
thereto, including, without limitation, damages and payments for past, present and future
infringements thereof, (d) the right (but not the obligation) to sue for past, present and
future infringements thereof, (e) rights corresponding thereto throughout the world in all
jurisdictions in which such patents have been issued or applied for, and (f) the reissues,
divisions, continuations, renewals, extensions and continuations-in-part with any of the
foregoing (all of the foregoing patents and applications and interests under patent license
agreements, together with the items described in clauses (a) through (f) in this paragraph are
sometimes herein individually and collectively referred to as the “Patents”);

	(x)	 	one hundred percent (100%)of the limited liability company membership interests in Portfolio
Recovery Associates, L.L.C., a Delaware limited liability company, PRA Location Services, LLC,
a Delaware limited liability company, PRA Government Services, LLC, a Delaware limited
liability company, PRA Receivables Management, LLC, a Virginia limited liability company, as
well as any interest whatsoever of Debtor in any entity, regardless of the form of such
entity, whether such interest is now owned or hereafter acquired, whether certificated,
uncertificated or in some other form or evidenced in some other manner or method or later
becomes certificated, owned and held by Debtor or owned by Debtor and held on Debtor’s behalf
and for the account of Debtor by some other person or entity, together with all now existing
and hereafter arising property and property rights and benefits accruing and payable
thereunder or otherwise arising therefrom or related thereto, including, without limitation,
all general intangibles and all payments, cash, monies, interest, payments, dividends,
distributions, insurance proceeds, condemnation proceeds and other proceeds; and

	(xi)	 	all now existing and hereafter arising accessions, products and proceeds, including, without
limitation, insurance proceeds and condemnation proceeds, of any and all of the foregoing
property and property rights.

5

EXHIBIT D

	 	 	 	 	 	 	 	 	 
	Bank of America, N.A. Wachovia Bank,
	 	BORROWING BASE CERTIFICATE
	National Association	 	RBC	 	(Estimated Remaining Collections of All
	Bank (USA) SunTrust Bank
	 	Eligible Asset Pools)	 	 	 	 
	 	 	 	 	Lenders: Bank of America, N.A.,
	Borrower: Portfolio Recovery Associates,
	 	Wachovia Bank, National Association,
	Inc.	 	 	 	RBC Bank (USA), SunTrust Bank
	Credit Line Amount:

	 	

	 	

	 	

	[Revolving and

Non-Revolving]

	 	

$340,000,000
	 	

	 	

	ESTIMATED REMAINING COLLECTIONS
	 	 	 	 	 	 
	1. Borrower’s and Portfolio Recovery Associates,
	 	 	 	 
	L.L.C.’s Estimated Remaining Collections of all Eligible
	 	 	 	 
	Asset Pools identified in the attached Asset Pool Report
	 	 	 	 
	(a) Bank of America
	 	 	 	 	 	 
	(b) Wachovia Bank
	 	 	 	 	 	 
	(c)

	 	RBC Bank (USA)
	 	

	 	

	(d)

	 	SunTrust Bank
	 	

	 	

	2. Loan Value of #1 (a) (30% of #1(a))
	 	 	 	 
	Loan Value of #1 (b) (30% of #1(b))
	 	 	 	 
	Loan Value of #1 (c) (30%) of #1(c))
	 	 	 	 
	Loan Value of #1 (d) (30%) of #1(d))
	 	 	 	 
	BALANCES

	 	

	 	

	 	

	3. Maximum Credit Line [Revolving and Non-Revolving]
	 	 	340,000,000	 
	
 
	 	 	 	 	 	 	 	 
	(a) Bank of America
	 	 	 	 	 	 
	(b) Wachovia Bank
	 	 	 	 	 	 
	(c) RBC Bank (USA)
	 	 	 	 	 	 
	(d) SunTrust Bank
	 	 	 	 	 	 
	4. Total Permissible Borrowings on Credit Line
	 	 	 	 
	[Revolving and Non-Revolving] (Lesser of #2 or #3)
	 	 	 	 
	(a) Bank of America
	 	 	 	 	 	 
	(b) Wachovia Bank
	 	 	 	 	 	 
	(c) RBC Bank (USA)
	 	 	 	 	 	 
	(d) SunTrust Bank
	 	 	 	 	 	 
	5. Present balance owing on Line of Credit [Revolving
	 	 	 	 
	and Non-Revolving]
	 	 	 	 	 	 
	(a) Bank of America
	 	 	 	 	 	 
	(b) Wachovia Bank
	 	 	 	 	 	 
	(c) RBC Bank (USA)
	 	 	 	 	 	 
	(d) SunTrust Bank
	 	 	 	 	 	 
	6. RESERVE POSITION (#4 minus #5)
	 	 	 	 	 	 
	(a) Bank of America
	 	 	 	 	 	 
	(b) Wachovia Bank
	 	 	 	 	 	 
	(c) RBC Bank (USA)
	 	 	 	 	 	 
	(d) SunTrust Bank
	 	 	 	 	 	 

The undersigned represents and warrants that the foregoing is true, accurate and complete as of the
date indicated below, and that the information reflected in this Borrowing Base Certificate
complies with the representations and warranties set forth in the Loan Agreement between the
undersigned, Bank of America, N.A., Wachovia Bank, National Association, RBC Bank (USA), and
SunTrust Bank.

	 	 	 	 	 
	Portfolio Recovery Associates, Inc.
	 	Date: __________________
	By:

	 	

	 	

	
 
	 	Steven D. Fredrickson

President and Chief Executive Officer
	 	

6

EXHIBIT E

	 	 	 
	Bank of America, N.A.	 	 
	Wachovia Bank, National Association	 	 
	RBC Bank (USA)	 	 
	SunTrust Bank

	 	COMPLIANCE CERTIFICATE

TO: BANK OF AMERICA, N.A, WACHOVIA BANK, NATIONAL ASSOCIATION, RBC BANK (USA), and SunTrust Bank
(the “Banks”)

FROM: PORTFOLIO RECOVERY ASSOCIATES, INC.

The undersigned authorized officer of Portfolio Recovery Associates, Inc. (“Borrower”) hereby
certifies that in accordance with the terms and conditions of the Third Amended and Restated Loan
and Security Agreement between Borrower and the Banks dated May 2, 2008 (the “Agreement”), (i)
Borrower is in complete compliance for the period ending      with all covenants set
forth in the Agreement, except as noted below and (ii) all representations and warranties of
Borrower stated in the Agreement are true, correct and accurate as of the date hereof. Attached
herewith are the required documents supporting the above certification. The undersigned authorized
officer further certifies that this Compliance Certificate and any supporting financial documents
have been prepared in accordance with Generally Accepted Accounting Principles (GAAP) and are
consistently applied from one period to the next except as explained in an accompanying letter or
footnotes – or unless otherwise permitted in the Agreement. Reference is made to the Agreement for
the relevant meanings of the reporting requirements and covenants which are stated below in a
“short-hand” manner.

Please indicate compliance status by circling Yes/No under “Complies” column.

	 	 	 	 	 	 	 
	Reporting Covenant	 	Required	 	Complies
	Quarterly financial statements

	 	Quarterly within 30 days
	 	Yes
	 	No
	Quarterly audits of Net Financed Balances

	 	Quarterly within 30 days
	 	Yes
	 	No
	Annual financial statements (Audited)

	 	FYE within 120 days
	 	Yes
	 	No
	10K and 10Q

	 	As applicable
	 	Yes
	 	No
	Borrowing Base Cert. – Estimated

Remaining Collections

	 	

Monthly within 30 days
	 	

Yes
	 	

No

(Continued on Next Page)

7

Compliance Certificate

(Continued from Previous Page)

	 	 	 	 	 	 	 	 	 	 	 	 	 
	Financial Covenant	 	Required	 	Actual	 	Complies
	Funded Debt to EBITDA

	 	Not more than 2.0 to 1.0

	 	 	 	to
	 	     

_
	 	Yes

	 	No

	Tangible Net Worth

	 	Equal to at least 100%

of Tangible Net Worth

reported by Borrower at

September 30, 2005,

plus 25% of cumulative

positive net income

accrued since the end

of such fiscal quarter,

plus 100% of the net

proceeds from any

equity offering,

calculated quarterly on

the last day of each

fiscal quarter, it

being understood that

up to $100,000,000

worth of funds expended

by Borrower on the

repurchase of

Borrower’s capital

stock shall not be

deducted from Tangible

Net Worth for purposes

of this covenant.
	 	

	 	

	 	

	 	Yes

	 	No

	
 
	 	 
	 	

	 	

	 	

	 	

	 	

(Continued on Next Page)

8

Compliance Certificate

(Continued from Previous Page)

	 	 	 	 	 	 	 
	Comments Regarding Exceptions: See Attached.

	 	BANK USE ONLY
	 	

	 	

	
 
	 	Received by:
	 	

	 	

	
 
	 	Authorized Signer
	 	

	 	

	
 
	 	Date:
	 	

	 	

	Authorized Signatory of Borrower

	 	

	 	

	 	

	
 
	 	Verified:
	 	

	 	

	
 
	 	Authorized Signer
	 	

	 	

	Title

	 	

	 	

	 	

	
 
	 	Date:
	 	

	 	

	Date

	 	

	 	

	 	

	
 
	 	Compliance Status
	 	Yes
	 	No

9

EXHIBIT F

Form of Asset Pool Report

10

SCHEDULE OF EXCEPTIONS

Permitted Indebtedness

Indebtedness owed by Borrower or any Guarantor hereunder or to (i) Steelcase Financial or De Lage
Landen Financial Services on Capitalized Leases maturing 6/14/2008, 8/16/2008 and 1/16/2009
respectively, and (ii) USBANCORP on operating Leases.

Permitted Investments

Investments (i) in the membership interests of each Guarantor and (ii) in connection with any
Permitted Acquisition.

Permitted Liens

Liens securing Permitted Indebtedness.

11

	 	 	 
	Bank of America, N.A.	 	 
	Wachovia Bank, National Association

RBC Bank (USA)

SunTrust Bank

	 	INSURANCE CERTIFICATION

and

AGREEMENT

	 	 	 
	TO:

	 	BANK OF AMERICA, N.A., WACHOVIA BANK, NATIONAL ASSOCIATION, RBC

BANK (USA) and SUNTRUST BANK
	Date: May 2, 2008

	From:

	 	PORTFOLIO RECOVERY ASSOCIATES, INC.

In consideration of a loan referenced above (“loan”), the undersigned, jointly and severally if
more than one, certifies to and agrees with Bank of America, Wachovia Bank, RBC Bank (USA), and
SunTrust Bank (the “Banks”) as follows:

(a) the insurance coverage required in connection with the loan is in place and will remain
in force during the term of the loan;

(b) the policies of insurance evidencing the insurance coverage referenced in (a) above are
listed below, which information is accurate in all material respects as of the date of this
certification;

(c) we have notified the agent and companies identified below to add “Bank of America, N.A.,
Wachovia Bank, National Association, RBC Bank (USA), SunTrust Bank and their successors and
assigns” as equal lender’s loss payees/mortgagees, as directed by the Banks, on the existing
insurance policies and to add “Bank of America, N.A., Wachovia Bank, National Association, RBC Bank
(USA) and SunTrust Bank and their successors and assigns” as equal lender’s loss payees/mortgagees
on any new policies;

(d) we have notified the agents and companies identified below to furnish the Banks at the
above addresses with copies of the policies with all endorsements, together with any subsequent
renewal policies – all of which shall reflect the interests of the Banks as required herein or as
may otherwise be directed by the Banks; and

(e) we have notified the agents and companies identified below to provide copies of all
notices given under the insurance policies to the Banks, including copies of all notices regarding
non-payment of premiums and termination or cancellation of the policies, or any of them.

The following is identifying information on the policies of insurance required to be carried by us
under the loan:

(Continued on Next Page)

12

	 	 	 	 	 	 	 	 	 	 	 	 	 
	Casualty Insurance
	 	Name: Hartford Casualty	 	Name:	 	 	 	 
	 
	 	Address: 8711 University East	 	Address:	 	 	 	 
	 
	 	Dr.	 	 	 	 	 	 	 	 
	 
	 	Charlotte, NC 28213	 	 	 	 	 	 	 	 
	 
	 	Telephone: 800-448-5462	 	Telephone:	 	 	 	 
	General Liability
	 	Name: Hartford Casualty	 	Name:	 	 	 	 
	 
	 	Address: 8711 University East	 	Address:	 	 	 	 
	 
	 	Dr.	 	 	 	 	 	 	 	 
	 
	 	Charlotte, NC 28213	 	 	 	 	 	 	 	 
	 
	 	Telephone:800-448-5462	 	Telephone:	 	 	 	 
	Workmen’s Comp.
	 	Name: PMA Insurance Co.	 	Name:	 	 	 	 
	 
	 	Address: P.O. Box 3031	 	Address:	 	 	 	 
	 
	 	380 Sentry Parkway	 	 	 	 	 	 	 	 
	 
	 	BWE BEU, PA 19422-0754	 	 	 	 	 	 	 	 
	 
	 	Telephone:610-397-5000	 	Telephone:	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	Name: AWAC
	 
	 	 	 	 	 	 	 	 	 	Address: 225
	 
	 	 	 	 	 	 	 	 	 	Franklin Street
	 
	 	 	 	 	 	 	 	 	 	Boston, MA
	Officers’ &
	 	 	 	 	 	 	 	 	 	 	—	 
	Directors’
	 	Name:XL Insurance	 	Name: Zurich North ________	 	Telephone:
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	Address: 17th Floor	 	Address:21st Floor	 	 	 	 
	 
	 	100 Constitution Plaza	 	1818 Market Street	 	 	 	 
	 
	 	Hartford, CT 06103	 	Philadelphia, PA 19103	 	 	 	 
	 
	 	Telephone:	 	Telephone:	 	 	 	 
	Flood Insurance
	 	Name: Hartford	 	Name: Travelers	 	 	 	 
	 
	 	Address: P.O. Box 2057	 	Address: P.O. Box 34272	 	 	 	 
	 
	 	Kalispell, MT 59903-2057	 	Bethesda, MD 20827	 	 	 	 
	 
	 	Telephone:800-759-8656	 	Telephone: 800-356-6670	 	 	 	 
	Umbrella Policy
	 	Name: Hartford Casualty	 	Name: St. Paul Travelers	 	 	 	 
	 
	 	Address: Hartford Plaza	 	Address: 111 Schilling Road	 	 	 	 
	 
	 	Hartford, CT  06115	 	Hunt Valley, MD  21031	 	 	 	 
	 
	 	Telephone:	 	Telephone:	 	 	 	 

(Signatures on Next Page)

13

	 
	Portfolio Recovery Associates, Inc.

By:      /s/ Steven D. Fredrickson     

Steven D. Fredrickson

President and Chief Executive Officer

14

	 	 	 
	Bank of America, N.A.	 	 
	Wachovia Bank, National Association	 	 
	RBC Bank (USA)

SunTrust Bank

	 	AUTOMATIC DEBIT

AUTHORIZATION

	 	 	 	 	 
	To: Bank of America, N.A.

	Wachovia Bank, National Association

	RBC Bank (USA)

	SunTrust Bank

	 	 	 
	You are hereby authorized and instructed to charge,

America account No.      and Wacho

      in the name of

     , RBC B

	 	respectively, Bank of

via Bank account No.

ank (USA) account No.
	_____________________ , and SunTrust Bank account No. _____________________ for

	principal, interest, fees, charges and other paymen

above-referenced loan (“loan”) as set forth below a

	 	ts due on the

nd credit the loan.
	     Debit each interest pa

according to the terms of

agreements evidencing the

renewed, extended, amended

substituted from time to t

	 	yment as it becomes due

the instruments and other

loan, as the same may be

        , modified, replaced and

ime.
	     Debit each principal p

according to the terms of

agreements evidencing the

renewed, extended, amended

substituted from time to t

	 	ayment as it becomes due

the instruments and other

loan, as the same may be

        , modified, replaced and

ime.
	     Debit any fees, charge

become due according to th

and other agreements evide

may be renewed, extended,

and substituted from time

	 	s and other payment as they

e terms of the instruments

ncing the loan, as the same

amended, modified, replaced

to time.
	This Authorization is to remain in full force and e

writing by an authorized representative of Borrower

Bank. A revocation shall be deemed delivered to a

p.m. on the calendar day which is 30 business days

revocation is deposited in the U.S. mail, postage p

Bank at such address as the Bank may designate from

	 	ffect until revoked in

which is delivered to each

Bank effective as of 5:00

following the date the

repaid, addressed to the

time to time.

	 	 	 
	Portfolio Recovery Associates, Inc.

By:     /s/ Steven D. Fredrickson     

Steven D. Fredrickson

President and Chief Executive Officer

	 	

Date: May 2, 2008

15

	 	 	 
	Bank of America, N.A.	 	 
	Wachovia Bank, National Association	 	 
	RBC Bank (USA)	 	 
	SunTrust Bank

	 	SIGNATURE AUTHORIZATION

To: Bank of America, N.A. Wachovia Bank, National Association            RBC Bank (USA) SunTrust
Bank

Address: One Commercial Place Address: 101 West Main Street Address: 555 E. Main St.
Address: 150 W. Main St.

	 	 	 	 	 
	Commercial Banking, 3rd Floor

	 	Mail Code VA 5263
	 	Suite 1000 Suite 1200
	Norfolk, VA 23510	 	Norfolk, VA 23510 Norfolk, VA 23510 Norfolk, VA 23510
	Attn: Paula H. Smith

	 	Attn: Charnette Simmons,
	 	Attn: Denise M. Howard, Attn: Joel Rhew

Senior Vice President            Vice President            Senior Vice
President

This Authorization is in reference to that certain Loan and Security Agreement (“Agreement”)
executed by the undersigned borrower (“Borrower”) concerning a loan or loans from Bank of America
        ,Wachovia Bank and RBC Bank (USA), and SunTrust Bank (each a “Bank” and collectively the “Banks”)
to Borrower. Each individual signing on behalf of the Borrower, as shown below, hereby certifies
that he/she has been authorized by Borrower to designate certain individuals who are employees or
agents of Borrower to perform such acts as are contemplated by and in furtherance of the Agreement.

The individuals named on the next page, and any one acting alone, are hereby authorized and
appointed for and on behalf of Borrower from time to time to do any of the following:

	 	(1)	 	To request advances of credit under the Agreement and to effect repayment of
any credit outstanding under the Agreement.

	 	(2)	 	To execute and deliver assignments, borrowing certificates, instruments,
schedules, reports, invoices, bills, shipping documents and such other documents and
certificates as may be necessary or appropriate under the Agreement and any instruments
and other agreements relating thereto, including all those executed and delivered in
connection therewith;

	 	(3)	 	To transfer and endorse to each Bank, as applicable, in payment of Borrower’s
obligations to each Bank any of Borrower’s now existing and hereafter acquired real and
personal property, including, without limitation, any goods, monies, accounts, general
intangibles, investment property, documents, chattel paper and any checks, drafts,
notes and other instruments payable to Borrower; and

	 	(4)	 	To do and perform any and all other acts and matters in any way relating to any
or all of the foregoing.

The undersigned individuals each further certifies that the specimen signatures below are the
genuine signatures of the individuals designated herein and that their signatures shall be binding
on Borrower until the Banks receive written notice of termination of the authority of any such
designated individuals.

	 	 	 
	Date: May 2, 2008

	 	Portfolio Recovery Associates, Inc.

By:     /s/ Steven D. Fredrickson     

Steven D. Fredrickson

President and Chief Executive Officer

Authorized Individuals and Specimen Signatures On Next Page

16

Attached to Signature Authorization

for

Portfolio Recovery Associates, Inc. to Bank of America, N.A. and Wachovia Bank, National

Association,

RBC Bank (USA), and SunTrust Bank

dated May 2, 2008

Authorized Individuals and Specimen Signatures:

	 	 	 
	Name (Typed or Printed)

	 	Signature
	Steven D. Fredrickson

	 	/s/ Steven D. Fredrickson
	 

	 	 
	Kevin P. Stevenson

	 	/s/ Kevin P. Stevenson
	Judith S. Scott

	 	/s/ Judith S. Scott

17

	 	 	 

	 	 	 
	Bank of America, N.A.
	Wachovia Bank, National Association
	RBC Bank (USA)	 	 
	SunTrust Bank

	 	Notice of Extension

To: PORTFOLIO RECOVERY ASSOCIATES, INC.

Address: 120 Corporate Boulevard

Suite 100

Norfolk, VA 23502

Attn:      

Facsimile:      

This Notice of Extension is in reference to that certain Third Amended and Restated Loan and
Security Agreement dated as of May 2, 2008 (“Agreement”) executed by Portfolio Recovery Associates,
Inc. (“Borrower”) concerning a loan or loans from Bank of America, Wachovia Bank, RBC Bank (USA),
and SunTrust Bank (each a “Bank” and collectively with any additional lenders thereunder, the
“Banks”), to Borrower.

Pursuant to Section 2.7 of the Agreement, you are hereby notified that the Revolver Maturity Date
of the Agreement (as defined therein) is hereby extended to a date that is one year from the
current Revolver Maturity Date. For avoidance of doubt, the Revolver Maturity Date is hereby
extended to May 4, 200_.

The provisions of the Agreement shall continue in full force and effect and shall not be modified
or amended in any manner except as expressly provided above.

BANK OF AMERICA, N.A. WACHOVIA BANK, NATIONAL ASSOCIATION

By:      By:      

	 	 	 
	Name:

	 	Name:
	Title:

	 	Title:
	Date:      

	 	Date:      
	RBC BANK (USA)

	 	SUNTRUST BANK

By:      By:      

	 	 	 
	Name:

	 	Names:
	Title:

	 	Title:
	Date:      

	 	Date:      

18exhibit101.htm

    
      Exhibit
10.1

    

    
 

    INDEMNITY
AGREEMENT

    

    This
INDEMNITY AGREEMENT dated as of the ___ day of _______, is made by and between
Knight Transportation, Inc. (the “Corporation”), and ___________________ (the
“Indemnitee”).

    

    RECITALS

    

    The
Articles of Incorporation and Bylaws of the Corporation provide for
indemnification by the Corporation of its directors to the fullest extent
permitted by law.  The Indemnitee has been serving and desires to
continue to serve as a director of the Corporation in part in reliance on such
indemnity provision.

    

    To
provide the Indemnitee with additional contractual assurance of protection
against personal liability in connection with certain proceedings described
below, the Corporation desires to enter into this Agreement.

    

    In order
to induce the Indemnitee to serve or continue to serve as a director of the
Corporation, and in consideration of the Indemnitee’s so serving, the
Corporation desires to indemnify the Indemnitee and to make arrangements
pursuant to which the Indemnitee may be advanced or reimbursed expenses incurred
by Indemnitee in certain proceedings described below, according to the terms and
conditions set forth below.

    

    AGREEMENT

    

    THEREFORE,
in consideration of the foregoing recitals and of Indemnitee’s serving or
continuing to serve the Corporation as a director, the parties agree as
follows:

    

    1.           Indemnification.

    

    (a)           In
accordance with the provisions of subsection (b) of this Section 1, the
Corporation shall hold harmless and indemnify the Indemnitee against any and all
expenses, liabilities and losses (including, without limitation, investigation
expenses and expert witnesses’ and attorneys’ fees and expenses, costs of court,
judgments, penalties, fines, and amounts paid or to be paid in settlement)
actually incurred by the Indemnitee (net of any related insurance proceeds or
other amounts received by Indemnitee or paid by or on behalf of the Corporation
on the Indemnitee’s behalf), in connection with any action, suit, or proceeding,
whether civil, criminal, administrative, or investigative, to which the
Indemnitee is a party or is threatened to be made a party (a “Proceeding”) based
upon, arising from, relating to, or by reason of the fact that Indemnitee is,
was, shall be, or shall have been a director and/or officer of the Corporation
or is or was serving, shall serve, or shall have served at the request of the
Corporation as a director, officer, partner, trustee, member, employee, or agent
(“Affiliate Indemnitee”) of another foreign or domestic corporation or
non-profit corporation, cooperative, partnership, joint venture, limited
liability company, trust or other incorporated or unincorporated enterprise
(each, a “Company Affiliate”).

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    (b)           Without
limiting the generality of the foregoing, the Indemnitee shall be entitled to
the rights of indemnification provided in this Section 1 for any expenses
actually incurred in any Proceeding initiated by or in the right of the
Corporation, unless indemnification is barred by A.R.S. §§ 10-851.D or 10-856.A,
or any other applicable law.

    

    (c)           In
providing the foregoing indemnification, the Corporation shall, with respect to
any proceeding, hold harmless and indemnify the Indemnitee to the fullest extent
not prohibited by the law of the State of Arizona, as in effect from time and
time, and the Articles of Incorporation.  For purposes of this
Agreement, it is intended that the indemnification afforded hereby be mandatory
and the broadest possible under any then existing statutory provision expressly
authorizing the Corporation to indemnify directors or officers whether in effect
on the date of this Agreement or hereafter, provided, however, that the
indemnification provisions of this Agreement shall apply without regard to
whether any provision set forth in the Articles or Bylaws of the Corporation
authorizing or permitting indemnification shall be in force or
effect.

    

    2.           Other Indemnification
Agreements.  The Corporation may purchase and maintain
insurance or furnish similar protection or make other arrangements, including,
but not limited to, providing a trust fund, letter of credit, or surety bond
(“Indemnification Arrangements”) on behalf of the Indemnitee against any
liability asserted against him or her or incurred by or on behalf of him or her
in such capacity as a director or officer of the Corporation or an Affiliated
Indemnitee, or arising out of his or her status as such, whether or not the
Corporation would have the power to indemnify him or her against such liability
under the provisions of this Agreement.  The purchase, establishment,
and maintenance of any such Indemnification Arrangement shall not in any way
limit or affect
the rights and obligations of the Corporation or of the Indemnitee under this
Agreement except as expressly provided herein, and the execution and delivery of
this Agreement by the Corporation and the Indemnitee shall not in any way limit
or affect the rights and obligations of the Corporation or the other party or
parties thereto under any such Indemnification Arrangement.  All
amounts payable by the Corporation pursuant to this Section 2 and Section 1
hereof are herein referred to as “Indemnified Amounts.”  To the extent
the Corporation is able to obtain directors and officers liability insurance of
a reasonable premium (as determined by the Corporation in its sole discretion),
the Corporation shall use reasonable efforts to cause the Indemnitee to be
covered by such insurance.

    

    3.           Advance Payment of
Indemnified Amounts.

    

    (a)           The
Indemnitee hereby is granted the right to receive in advance of a final,
nonappealable judgment or other final adjudication of a Proceeding (a “Final
Determination”) the amount of any and all expenses, including, without
limitation, investigation expenses, court costs, expert witnesses’ and
attorneys’ fees and other expenses expended or incurred by the Indemnitee in
connection with any Proceeding or otherwise expensed or incurred by the
Indemnitee (such amounts so expended or incurred being hereinafter referred to
as “Advanced Amounts”).

    

    
      
         

      

      
        -2-

        
          

        

      

      
         

      

    

    (b)           In
making any written request for Advanced Amounts, the Indemnitee shall submit to
the Corporation a schedule setting forth in reasonable detail the dollar amount
expended or incurred and expected to be expended.  Each such listing
shall be supported by the bill, agreement, or other documentation relating
thereto, each of which shall be appended to the schedule as an
exhibit.  In addition, before the Indemnitee may receive Advanced
Amounts from the Corporation, the Indemnitee shall provide to the Corporation
(i) a written affirmation of the Indemnitee’s good faith belief that the
applicable standard of conduct required for indemnification by the Corporation
has been satisfied by the Indemnitee, and (ii) a written undertaking by or on
behalf of the Indemnitee to repay the Advanced Amount if it shall ultimately be
determined that the Indemnitee has not satisfied any applicable standard of
conduct.  The written undertaking required from the Indemnitee shall
be an unlimited general obligation of the Indemnitee but need not be
secured.  The Corporation shall pay to the Indemnitee all Advanced
Amounts within twenty (20) days after receipt by the Corporation of all
information and documentation required to be provided by the Indemnitee pursuant
to this paragraph.

    

    4.           Procedure for Payment of
Indemnified Amounts.

    

    (a)           To
obtain indemnification under this Agreement, the Indemnitee shall submit to the
Corporation a written request for payment of the appropriate Indemnified
Amounts, including with such requests such documentation and information as is
reasonably available to the Indemnitee and reasonably necessary to determine
whether and to what extent the Indemnitee is entitled to
indemnification.  The Secretary of the Corporation shall, promptly
upon receipt of such a request for indemnification, advise the Board of
Directors in writing that the Indemnitee has requested
indemnification.

    

    (b)           The
Corporation shall pay the Indemnitee the appropriate Indemnified Amounts unless
it is established that the Indemnitee engaged in one of the Prohibited Acts, and
such Prohibited Act was the subject matter of the Proceeding.  For
purposes of determining whether the Indemnitee is entitled to Indemnified
Amounts, in order to deny indemnification to the Indemnitee, the Corporation has
the burden of proof in establishing (1) that the Indemnitee engaged in the
Prohibited Act, and (2) that the Prohibited Act was the subject matter of the
Proceeding.  In this regard, a termination of any Proceeding by
judgment, order or settlement does not create a presumption that the Indemnitee
did not meet the requisite standard of conduct; provided, however, that the
termination of any criminal proceeding by conviction, or a pleading of nolo
contendere or its equivalent, or an entry of an order of probation prior to
judgment, creates a rebuttable presumption that the Indemnitee engaged in a
Prohibited Act.  For purposes of this Agreement, a Prohibited Act
shall mean any act, omission or condition (i) described in A.R.S. § 10-851.D or
10-856.A for which the Corporation may not indemnify the Indemnitee or (ii) any
act, omission or condition for which indemnity is not available under any
federal or state law or public policy.

    

    (c)           Any
determination that the Indemnitee has engaged in a Prohibited Act shall be made
(i) either by the Board of Directors by a majority vote of a quorum consisting
of directors who were not parties to such Proceeding; or (ii) by independent
legal counsel (who may be the outside counsel regularly employed by the
Corporation); provided that the manner in which (and, if applicable, the counsel
by which) the right of indemnification is to be determined

    
      
         

      

      
        -3-

        
          

        

      

      
         

      

    

    shall be
approved in advance in writing by both the highest ranking executive officer of
the Corporation who is not a party to such action (sometimes hereinafter
referred to as “Senior Officer”) and by the Indemnitee.  In the event
that such parties are unable to agree on the manner in which any such
determination is to be made, such determination shall be made by independent
legal counsel retained by the Corporation especially for such purpose, provided
that such counsel be approved in advance in writing by both the Senior Officer
and the Indemnitee and, provided further, that such counsel shall not be outside
counsel regularly employed by the Corporation.  The fees and expenses
of counsel in connection with making the determination contemplated hereunder
shall be paid by the Corporation, and, if requested by such counsel, the
Corporation shall give such counsel an appropriate written agreement with
respect to the payment of their fees and expenses and such other matters as may
be reasonably requested by counsel.

    

    (d)           The
Corporation will use its best efforts to conclude as soon as practicable any
required determination pursuant to subparagraph (c) above and promptly will
advise the Indemnitee in writing with respect to any determination that the
Indemnitee is or is not entitled to indemnification, including a description of
any reason or basis for which indemnification has been
denied.  Payment of any applicable Indemnified Amounts will be made to
the Indemnitee within ten (10) days after any determination of the Indemnitee’s
entitlement to indemnification.

    

    (e)           Notwithstanding
the foregoing, the Indemnitee may, at any time after sixty (60) days after a
claim for Indemnified Amounts has been filed with the Corporation (or upon
receipt of written notice that a claim for Indemnified Amounts has been
rejected, if earlier) and before three (3) years after a claim for Indemnified
Amounts has been filed, petition a court of competent jurisdiction to determine
whether the Indemnitee is entitled to indemnification under the provisions of
this Agreement, and such court shall thereupon have the exclusive authority to
make such determination unless and until such court dismisses or otherwise
terminates such action without having made such determination.  The
court shall, as petitioned, make an independent determination of whether the
Indemnitee is entitled to indemnification as provided under this Agreement,
irrespective of any prior determination made by the Board of Directors or
independent counsel.  If the court shall determine that the Indemnitee
is entitled to indemnification as to any claim, issue or matter involved in the
Proceeding with respect to which there has been no prior determination pursuant
to this Agreement or with respect to which there has been a prior determination
that the Indemnitee was not entitled to indemnification hereunder, the
Corporation shall pay all expenses (including attorneys’ fees and court costs)
actually incurred by the Indemnitee in connection with such judicial
determination.

    

    5.           Agreement Not Exclusive;
Subrogation Rights, etc.

    

    (a)           This
Agreement shall not be deemed exclusive of and shall not diminish any other
rights the Indemnitee may have to be indemnified or insured or otherwise
protected against any liability, loss, or expense by the Corporation, any
subsidiary of the Corporation, or any other person or entity under any charter,
bylaws, law, agreement, policy of insurance or similar protection, vote of
stockholders or directors, disinterested or not, or otherwise, whether or not
now in effect, both as to actions in the Indemnitee’s official capacity, and as
to actions in another capacity while holding such office.  The
Corporation’s obligations to

    
      
         

      

      
        -4-

        
          

        

      

      
         

      

    

    make
payments of Indemnified Amounts hereunder shall be satisfied to the extent that
payments with respect to the same Proceeding (or part thereof) have been made to
or for the benefit of the Indemnitee by reason of the indemnification of the
Indemnitee pursuant to any other arrangement made by the Corporation for the
benefit of the Indemnitee.

    

    (b)           In
the event the Indemnitee shall receive payment from any insurance carrier or
from the plaintiff in any Proceeding against such Indemnitee in respect of
Indemnified Amounts after payments on account of all or part of such Indemnified
Amounts have been made by the Corporation pursuant hereto, such Indemnitee shall
promptly reimburse to the Corporation the amount, if any, by which the sum of
such payment by such insurance carrier or such plaintiff and payments by the
Corporation or pursuant to arrangements made by the Corporation to Indemnitee
exceeds such Indemnified Amounts; provided, however, that such portions, if any,
of such insurance proceeds that are required to be reimbursed to the insurance
carrier under the terms of its insurance policy, such as deductible or
co-insurance payments, shall not be deemed to be payments to the Indemnitee
hereunder.  In addition, upon payment of Indemnified Amounts
hereunder, the Corporation shall be subrogated to the rights of Indemnitee
receiving such payments (to the extent thereof) against any insurance carrier
(to the extent permitted under such insurance policies) or plaintiff in respect
to such Indemnified Amounts and the Indemnitee shall execute and deliver any and
all instruments and documents and perform any and all other acts or deeds which
the Corporation deems necessary or advisable to secure such
rights.  Such right of subrogation shall be terminated upon receipt by
the Corporation of the amount to be reimbursed by the Indemnitee pursuant to the
first sentence of this paragraph.

    

    6.           Continuation of
Indemnity.  All agreements and obligations of the Corporation
contained herein shall continue during the period Indemnitee is a director of
the Corporation (or is serving at the request of the Corporation as an Affiliate
Indemnitee) and shall continue thereafter so long as Indemnitee shall be subject
to any possible Proceeding by reason of the fact that Indemnitee was a director,
officer or employee of the Corporation or was serving in any other capacity
referred to herein.

    

    7.           Successors; Binding
Agreement.  This Agreement shall be binding on and shall inure
to the benefit of and be enforceable by the Corporation’s successors and assigns
and by the Indemnitee’s personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees, and
legatees.  The Corporation shall require any successor or assignee
(whether direct or indirect, by purchase, merger, consolidation, or otherwise)
to all or substantially all of the business and/or assets of the Corporation, by
written agreement in form and substance reasonably satisfactory to the
Corporation and to the Indemnitee, expressly to assume and agree to perform this
Agreement in the same manner and to the same extent that the Corporation would
be required to perform if no such succession or assignment had taken
place.

    

    8.           Enforcement.  The
Corporation has entered into this Agreement and assumed the obligations imposed
on the Corporation hereby in order to induce the Indemnitee to act as a director
of the Corporation, and acknowledges that the Indemnitee is relying upon this
Agreement in continuing in such capacity.  In the event the Indemnitee
is required to bring any action to enforce rights or to collect monies due under
this Agreement and is successful in such action, the Corporation shall reimburse
Indemnitee for all of the Indemnitee’s fees and expenses in bringing and
pursuing such action.  The Indemnitee shall be entitled to the
advancement of Indemnified Amounts to the full extent contemplated by Section 3
hereof in connection with such Proceeding.

    
      
         

      

      
        -5-

        
          

        

      

      
         

      

    

    

    9.           Separability.  Each
of the provisions of this Agreement is a separate and distinct agreement
independent of the others, so that if any provision hereof shall be held to be
invalid or unenforceable for any reason, such invalidity or unenforceability
shall not affect the validity or enforceability of the other provisions hereof,
which other provisions shall remain in full force and effect.

    

    10.           Miscellaneous.  No
provision of this Agreement may be modified, waived, or discharged unless such
modification, waiver, or discharge is agreed to in writing signed by Indemnitee
and either the Chairman of the Board or the President of the Corporation or
another officer of the Corporation specifically designated by the Board of
Directors.  No waiver by either party at any time of any breach by the
other party of, or of compliance with, any condition or provision of this
Agreement to be performed by such other party shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same time or at any prior
or subsequent time.  No agreements or representations, oral or
otherwise, express or implied, with respect to the subject matter hereof have
been made by either party which are not set forth expressly in this
Agreement.  The validity, interpretation, construction, and
performance of this Agreement shall be governed by the laws of the State of
Arizona, without giving effect to the principles of conflicts of laws
thereof.  The Indemnitee may bring an action seeking resolution of
disputes or controversies arising under or in any way related to this Agreement
in the state or federal court jurisdiction in which Indemnitee resides or in
which his or her place of business is located, and in any related appellate
courts, and the Corporation consents to the jurisdiction of such courts and to
such venue.

    

    11.           Notices.  For
the purposes of this Agreement, notices and all other communications provided
for in the Agreement shall be in writing and shall be deemed to have been duly
given when delivered or mailed by United States registered mail, return receipt
requested, postage prepaid, as follows:

    

    If to
Indemnitee:               
 ___________________

    Knight
Transportation, Inc.

    5601 W.
Buckeye Road

    Phoenix,
Arizona 85043

    

    If to
Corporation:                Knight
Transportation, Inc.

    5601 West
Buckeye Road

    Phoenix,
Arizona 85043

    Attention:  Secretary

    

    or to
such other address as either party may have furnished to the other in writing in
accordance herewith, except that notices of change of address shall be effective
only upon receipt.

    

    12.           Counterpart.  This
Agreement may be executed in one or more counterparts, each of which shall be
deemed to be an original but all of which together shall constitute one and the
same instrument.

    

    13.           Effectiveness.  This
Agreement shall be effective as of _________, ____.

    
      
         

      

      
        -6-

        
          

        

      

      
         

      

    

    IN
WITNESS WHEREOF, the undersigned have caused this Agreement to be executed as of
the day and year first above written.

    

    

     

    
      
        	 
      	
                KNIGHT
      TRANSPORTATION, INC., an 

                Arizona
      corporation

              

      

      

 

     

     

    -7-

     

     

    Back to Form
10-Q

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00142-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00142-of-00352.parquet"}]]