Document:

EX-10.1

Board of Directors Compensation Policy

December 16, 2010

Effective January 1, 2011

Policy Information

	 	 	 
	Document Title:

	 	Board of Directors Compensation Policy
	Content Owner:

	 	Director of Human Resources and

Administration
	Certification of Compliance Contact:

	 	N/A
	Policy Category:

	 	FHLBank Policy
	FHLBank-Level Approver:

	 	Policy Oversight Group
	Board-Level Approver:

	 	Full Board
	Review Frequency:

	 	Yearly
	Initial Effective Date:

	 	01/01/2010
	Last Review Date:

	 	12/17/2009
	Next Review Date:

	 	12/2011

1

Introduction

This FHLBank Policy, governed by the board of directors, governs the compensation of individuals
serving as directors of the Federal Home Loan Bank of Topeka (FHLBank). Section 7(i) of the
Federal Home Loan Bank Act (Bank Act) and 12 U.S.C. §1261.22 require the board annually to adopt a
written compensation policy to provide for the payment of reasonable compensation and expenses to
the directors for the time required of them in performing their duties as directors.

Purpose

Directors should be reasonably compensated for the time and effort exerted in the performance of
their duties as a director of FHLBank. This policy establishes reasonable compensation for the
activities and functions for which director attendance or participation is necessary and provides
compensation reflecting the amount of time a director has spent on official FHLBank business.
Differentials in meeting attendance fees for the chair, vice chair and the various committee chairs
shall reflect the additional responsibility assumed by these directors.

Scope

Directors shall be compensated for attendance at board meetings. Directors shall not be compensated
for attendance though telephone or video conference.

Policy

1. Compensation. Individuals serving as directors of FHLBank shall be paid a meeting fee
for each day in physical attendance at a regular or special meeting of the board of directors and
shall receive no other compensation from FHLBank other than reimbursement of expenses. The
following table illustrates the maximum annual compensation to be paid to various board member
positions. The daily meeting fee shall be the maximum in the table below divided by six.

	 	 	 	 	 
	Position	 	Maximum Annual Compensation
	Director
	 	$	75,000	 
	Vice Chair of Board
	 	$	85,000	 
	Chair of Board
	 	$	100,000	 
	Audit Committee Chair
	 	$	85,000	 
	Compensation Committee Chair
	 	$	85,000	 
	Operations Committee Chair
	 	$	85,000	 
	Housing and Governance Committee Chair
	 	$	85,000	 
	Risk Oversight Chair
	 	$	85,000	 

2. Number of Meetings. The board of directors shall hold at least six regular board
meetings per year. Special meetings of the board of directors may be held as provided in the
FHLBank’s bylaws.

3. Reimbursement of Expenses. Directors shall be entitled to reimbursement for all
necessary and reasonable travel, subsistence and other related expenses incurred in connection with
the performance of their official duties as provided in the Directors and Executive Officers Travel
Policy, except that directors may not be paid for gift or entertainment expenses.

Policy Review

This policy shall be reviewed annually and revised as needed by the Director of Human Resources and
Administration. Any such revisions shall be approved by the Policy Oversight Group and submitted
for review and approval by the Compensation committee and the board of directors.

2EX-10.1

Exhibit 10.1

Dated 16 December 2010

BETWEEN

ALTERRA CAPITAL HOLDINGS LIMITED

as Guarantor

- and -

ALTERRA CAPITAL UK LIMITED

as Account Party and Applicant

- and -

THE BANKS AND FINANCIAL INSTITUTIONS LISTED IN SCHEDULE 1 TO THE APPENDIX

as Banks

- and -

ING BANK N.V., LONDON BRANCH

as Agent

- and -

ING BANK N.V., LONDON BRANCH

as Issuing Bank

- and -

ING BANK N.V., LONDON BRANCH

as Security Trustee

AMENDING AND RESTATING AGREEMENT

RELATING TO A CREDIT FACILITY AGREEMENT

DATED 13 OCTOBER 2008

(as amended and restated on 30 March 2010 and as

further amended on 26 November 2010 )

Credit facility of up to £60,000,000

INDEX

THIS AGREEMENT is made on 16 December 2010

BETWEEN

	(1)	 	ALTERRA CAPITAL HOLDINGS LIMITED (formerly known as MAX CAPITAL GROUP LTD) as Guarantor;

	(2)	 	ALTERRA CAPITAL UK LIMITED (formerly known as MAX UK HOLDINGS LTD) as Account Party and
Applicant;

(3) THE BANKS AND FINANCIAL INSTITUTIONS LISTED IN SCHEDULE 1 TO THE APPENDIX as Banks;

(4) ING BANK N.V., London Branch as Agent;

(5) ING BANK N.V., London Branch as Issuing Bank; and

(6) ING BANK N.V., London Branch as Security Trustee.

WHEREAS

	(A)	 	The parties entered into the Credit Facility Agreement on 13 October 2008 and entered into an
agreement amending and restating the Credit Facility Agreement on 30 March 2010 and a
supplemental letter amending the Credit Facility Agreement on 26 November 2010.

	(B)	 	The parties now wish to amend and restate the Credit Facility Agreement further in accordance
with this Agreement in order to set out the terms on which the Banks have agreed to renew the
facilities granted under the Credit Facility Agreement in the new amount of £60,000,000.

IT IS AGREED AS FOLLOWS

	1.	 	DEFINITIONS AND INTERPRETATIONS

	1.1	 	Definitions

In this Agreement including the Recitals hereto (unless the context otherwise requires), any
term or expression defined in the Credit Facility Agreement shall have the same meaning in
this Agreement. In addition, the following terms and expressions shall have the meanings
given in this Clause 1.1:

"Alterra Holdings” means Alterra Capital Holdings Limited (formerly known as Max Capital
Group Ltd), a company incorporated in Bermuda with its registered office at Max House, 2
Front Street, Hamilton, Bermuda;

"Alterra UK” means Alterra Capital UK Limited (formerly known as Max UK Holdings Ltd), a
company incorporated in England and Wales under company number 05800142 and with its
registered office at 70 Gracechurch Street, London EC3V 0XL;

"Credit Facility Agreement” means the credit facility agreement dated 13 October 2008
between the parties to this Agreement (as amended and restated on 30 March 2010);

"Effective Date” means the date on which the documents and evidence referred to in Clause
2.2 are received by the Agent; and

"Replacement Fee Letter” means a fee letter to be made between Alterra UK and the Agent
replacing the existing Fee Letter and setting out details of the amendment fee referred to
in Clause 6.

	1.2	 	Construction of certain expressions

The following expressions shall be construed in the following manner:

"Account Party”, “Applicant”, “Corporate Member”, “Guarantor” and “Obligor” include their
respective legal personal representatives, administrators, successors and permitted assigns;

"Agent”, “Bank”, “Creditor Party”, “Issuing Bank” and “Security Trustee” include their
respective successors and assigns;

	 	 	 	 	 
	 	1.3	 	 	"Appendix” means the appendix hereto;

"party” means a party hereto; and

"person” includes a corporate entity and any body of persons, corporate or unincorporated.

General interpretation

In this Agreement:

	 	1.3.1	 	unless the context otherwise requires, words in the singular include the
plural and vice versa;

	 	1.3.2	 	references to any document include the same as varied, supplemented or
replaced from time to time;

	 	1.3.3	 	references to any enactment include re-enactments, amendments and extensions
thereof;

	 	1.3.4	 	clause headings are for convenience of reference only and are not to be taken
into account in construction; and

	 	1.3.5	 	unless otherwise specified, references to Clauses and Recitals are to Clauses
of and Recitals to this Agreement.

	2.	 	AMENDMENT AND RESTATEMENT

	2.1	 	Amendment and restatement of Credit Facility Agreement

With effect from the Effective Date, the Credit Facility Agreement shall be amended and
restated so that it shall be read and construed for all purposes as set out in the Appendix
(Amended Credit Facility Agreement).

	2.2	 	Conditions precedent

The amendments referred to in Clause 2.1 are conditional upon, and shall not be effective
until, the Agent shall have received all the following documents and evidence in form and
substance satisfactory to it:

	 	2.2.1	 	an original of this Agreement duly executed by each of the parties and signed
by Alterra Corporate Capital 2 Limited and Alterra Corporate Capital 3 Limited (the
“Corporate Members”) by way of acknowledgment of its terms;

	 	2.2.2	 	an original of the Replacement Fee Letter duly executed by each of the
parties;

	 	2.2.3	 	an original comfort letter from Lloyd’s to the Agent with respect to the order
of application of FAL of each Corporate Member substantially in the form of Schedule 9
to the Appendix (or such other form as the Agent may agree);

	 	2.2.4	 	an original deed of undertaking from the Managing Agent to the Agent in the
form of Schedule 10 to the Appendix (or such other form as the Agent may agree);

	 	2.2.5	 	certified copies of the memorandum and articles of incorporation or equivalent
constitutional documents of each Obligor and Alterra Bermuda or a certificate from a
director or officer of that Obligor and Alterra Bermuda confirming that, save for its
change of name, there has been no change to its memorandum and articles of association
or equivalent constitutional documents;

	 	2.2.6	 	a certificate of goodstanding issued by the Bermuda Registrar of Companies in
respect of Alterra Holdings and Alterra Bermuda;

	 	2.2.7	 	a certificate of incumbency of each Obligor and Alterra Bermuda, signed by the
secretary or a director of that Obligor and Alterra Bermuda stating its officers and
directors;

	 	2.2.8	 	certified copies of resolutions duly passed by the directors of each Obligor
and Alterra Bermuda and, if appropriate and requested by the Agent, the shareholders of
each Obligor (other than Alterra Holdings) at separate meetings evidencing approval of
the transactions contemplated by this Agreement and authorising the execution of the
same;

	 	2.2.9	 	the original or a certified copy of any power of attorney issued by each
Obligor and Alterra Bermuda in favour of any person or persons executing this
Agreement;

	 	2.2.10	 	certified copies of all licences, authorisations, approvals and consents (if any)
required in connection with the execution, delivery, performance, validity and
enforceability of this Agreement;

	 	2.2.11	 	evidence that the aggregate amount of the Letters of Credit does not exceed
£60,000,000;

	 	2.2.12	 	a borrowing base certificate duly executed by the Account Party in the form of
Schedule 7to the Appendix (or such other form as the Agent may agree);

	 	2.2.13	 	a certificate from the Account Party dated on the Effective Date confirming the
amount of Primary FAL; and

	 	2.2.14	 	favourable opinions from the Agent’s legal advisers in Bermuda, New York and England
in relation to this Agreement in such terms as the Agent may require.

	3.	 	REPRESENTATIONS AND WARRANTIES

	3.1	 	Date of representations and warranties

Each of Alterra UK and Alterra Holdings hereby represents and warrants that the following
matters are true at the date of this Agreement and on the Effective Date.

	3.2	 	Capacity and authorisation

The entry into and performance by Alterra UK and Alterra Holdings of this Agreement are, so
far as it is aware and having made due enquiry, within the corporate powers of Alterra UK
and Alterra Holdings and have been duly authorised by all necessary corporate actions and
approvals.

	3.3	 	No contravention of laws or contractual restrictions

The entry into and performance by each of Alterra UK and Alterra Holdings of this Agreement
does not and will not contravene in any material respect any law, regulation or contractual
restriction which does, or may, bind Alterra UK and Alterra Holdings or any of their
respective assets.

	3.4	 	Validity and enforceability

When duly executed and delivered, this Agreement will constitute the legal, valid and
binding obligations of Alterra UK and Alterra Holdings except insofar as enforcement may be
limited by any applicable laws relating to bankruptcy, insolvency, administration and
similar laws affecting creditors’ rights generally.

	3.5	 	Quota Share Agreements for 2011 underwriting year of account

Neither party to any of the Quota Share Agreements has exercised any right of termination
thereunder and accordingly the risks and profits of the Corporate Members in respect of the
2011 underwriting year of account for each Syndicate are covered by the respective Quota
Share Agreements in accordance with their terms.

	4.	 	CONTINUITY AND FURTHER ASSURANCE

	4.1	 	Continuing obligations

The rights and obligations of the parties under the Credit Facility Agreement and the other
Finance Documents (including the Corporate Members) shall continue in full force and effect,
uninterrupted by the amendment and restatement hereunder, save insofar as they are amended
hereby and the Security Interests created by the relevant Finance Documents shall continue
fully to secure the obligations of the Account Party under the Credit Facility Agreement as
so amended and restated notwithstanding the extension of its term.

	4.2	 	Prospective effect only

The amendments made hereby to the Credit Facility Agreement shall, with effect from the
Effective Date, have prospective effect only.

	4.3	 	Actions already taken

Any action already taken and any payment already made by a party under the Credit Facility
Agreement prior to the Effective Date shall be treated as having been taken or made
notwithstanding the amendment and restatement hereby, and shall not be required to be taken
or made again by reason of the amendment and restatement hereby.

	4.4	 	Further assurance

Each of the parties shall do all acts and things necessary or desirable to give effect to
the amendments effected or to be effected pursuant hereto.

	5.	 	AMENDMENTS

The parties may agree to further amendments to the Credit Facility Agreement, as amended
hereby, without being required to amend or terminate this Agreement.

	6.	 	AMENDMENT FEE

Alterra UK undertakes to pay to the Agent for distribution to the Banks in such proportions
as they may agree with the Agent a non-refundable amendment fee on such date and in such
amount as is specified in the Replacement Fee Letter.

	7.	 	TRANSFERS

Any transfer or assignment made in accordance with the terms of the Credit Facility
Agreement shall have the same effect in relation to the rights and obligations of the
parties under this Agreement as it has in relation to their rights and obligations under the
Credit Facility Agreement.

	8.	 	INCORPORATION OF TERMS

The provisions of clauses 1.10 (Rights of third parties), 16.3 (Indemnity against costs), 25
(Assignments and Transfers), 27 (Miscellaneous), 29 (Notices) and 30 (Governing Law and
Jurisdiction) of the amended Credit Facility Agreement, as amended and restated hereby,
shall be incorporated into this Agreement as if set out herein and as if references therein
to “this Agreement” were references to this Agreement and as though this Agreement were
included in the definition of “Finance Documents”.

AS WITNESS the hands of the parties the day and year first before written

1

SIGNATURE PAGES

GUARANTOR

	 	 	 	 	 
	SIGNED for and on behalf
	 	 	)	 
	of ALTERRA CAPITAL
	 	 	)	 
	HOLDINGS LIMITED
	 	 	)	 
	by
	 	 	)	 
	APPLICANT
	 	 	 	 
	 
	 	 	 	 
	SIGNED for and on behalf
	 	 	)	 
	of ALTERRA CAPITAL UK LIMITED
	 	 	)	 
	by
	 	 	)	 
	ACCOUNT PARTY
	 	 	 	 
	 
	 	 	 	 
	SIGNED for and on behalf
	 	 	)	 
	of ALTERRA CAPITAL UK LIMITED
	 	 	)	 
	by
	 	 	)	 
	BANKS
	 	 	 	 
	 
	 	 	 	 
	SIGNED for and on behalf
	 	 	)	 
	of ING BANK N.V.,
	 	 	)	 
	LONDON BRANCH
	 	 	)	 
	by
	 	 	)	 
	 
	 	 	)	 
	 
	 	 	)	 
	AGENT
	 	 	 	 
	 
	 	 	 	 
	SIGNED for and on behalf
	 	 	)	 
	of ING BANK N.V.,
	 	 	)	 
	LONDON BRANCH
	 	 	)	 
	by
	 	 	)	 
	 
	 	 	)	 
	 
	 	 	)	 

[SIGNATURE PAGE TO AMENDING AND RESTATING AGREEMENT]

2

 

ISSUING BANK

	 	 	 	 	 
	SIGNED for and on behalf
	 	 	)	 
	of ING BANK N.V.,
	 	 	)	 
	LONDON BRANCH
	 	 	)	 
	by
	 	 	)	 
	 
	 	 	)	 
	 
	 	 	)	 
	SECURITY TRUSTEE
	 	 	 	 
	 
	 	 	 	 
	SIGNED for and on behalf
	 	 	)	 
	of ING BANK N.V.,
	 	 	)	 
	LONDON BRANCH
	 	 	)	 
	by
	 	 	)	 
	 
	 	 	)	 
	 
	 	 	)	 

[SIGNATURE PAGE TO AMENDING AND RESTATING AGREEMENT]

3

ACKNOWLEDGMENT

Acknowledged and agreed

	 	 	 	 	 
	SIGNED for and on behalf
	 	 	)	 
	of ALTERRA CORPORATE
	 	 	)	 
	CAPITAL 2 LIMITED
	 	 	)	 
	by
	 	 	)	 
	SIGNED for and on behalf
	 	 	)	 
	of ALTERRA CORPORATE
	 	 	)	 
	CAPITAL 3 LIMITED
	 	 	)	 
	by
	 	 	)	 

[SIGNATURE PAGE TO AMENDING AND RESTATING AGREEMENT]

Appendix

AMENDED AND RESTATED CREDIT FACILITY AGREEMENT

THIS AGREEMENT dated 13 October 2008 as amended and restated by an amending and restating agreement
dated 30 March 2010, as amended by a supplemental letter dated 26 November 2010 and as further
amended and restated by an amending and restating agreement dated 16 December 2010 (the “Amending
and Restating Agreement”) is made

BETWEEN

	(1)	 	ALTERRA CAPITAL HOLDINGS LIMITED (formerly known as Max Capital Group Ltd) as Guarantor;

	(2)	 	ALTERRA CAPITAL UK LIMITED (formerly known as Max UK Holdings Ltd) as Account Party and
Applicant;

(3) THE BANKS AND FINANCIAL INSTITUTIONS LISTED IN SCHEDULE 1 as Banks;

(4) ING BANK N.V., London Branch as Agent;

(5) ING BANK N.V., London Branch as Issuing Bank; and

(6) ING BANK N.V., London Branch as Security Trustee.

WHEREAS

The Banks have agreed to make available to the Account Party, subject as provided in this
Agreement, a committed credit facility of up to £60,000,000 to provide FAL at the request of the
Applicant to support the underwriting capacity of the Corporate Members in relation to the
Syndicates.

IT IS AGREED AS FOLLOWS

	1.	 	DEFINITIONS AND INTERPRETATIONS

	1.1	 	Definitions

In this Agreement, including the Recitals, the following expressions shall have the
following meanings:

"2007 Alterra Corporate 2 QSA” means the quota share agreement dated 1 January 2007 and made
between (a) Alterra Corporate 2 and (b) Imagine Insurance Company Limited pursuant to which
87.5% of the risks and profits written by Alterra Corporate 2 in Lloyd’s Syndicate 1400 for
the 2007 and 2008 underwriting years of account are transferred to Imagine Insurance Company
Limited, and any replacement quota share agreement entered into between (a) Alterra
Corporate 2 and (b) Alterra Bermuda in accordance with the Quota Share Assignment in respect
of that quota share agreement;

"2009 Alterra Corporate 2 Syndicate 1400 QSA” means the quota share agreement effective as
of 1 January 2009, as amended, and made between (a) Alterra Corporate 2 and (b) Alterra
Bermuda pursuant to which:

	 	(a)	 	70% of the risks and profits written by Alterra Corporate 2 in Lloyd’s
Syndicate 1400 for the 2009 underwriting year of account; and

	 	(b)	 	65% of the risks and profits written by Alterra Corporate 2 in Lloyd’s
Syndicate 1400 for the 2010 and subsequent underwriting years of account,

are to be transferred to Alterra Bermuda;

"2009 Alterra Corporate 2 Syndicate 2526 QSA” means the quota share agreement effective as
of 1 January 2009, as amended, and made between (a) Alterra Corporate 2 and (b) Alterra
Bermuda pursuant to which 70% of the risks and profits written by Alterra Corporate 2 in
Lloyd’s Syndicate 2526 for the 2009 and subsequent underwriting years of account are to be
transferred to Alterra Bermuda;

"2009 Alterra Corporate 3 Syndicate 1400 QSA” means the quota share agreement effective as
of 1 January 2009, as amended, and made between (a) Alterra Corporate 3 and (b) Alterra
Bermuda pursuant to which:

	 	(a)	 	70% of the risks and profits written by Alterra Corporate 3 in Lloyd’s
Syndicate 1400 for the 2009 underwriting year of account; and

	 	(b)	 	65% of the risks and profits written by Alterra Corporate 3 in Lloyd’s
Syndicate 1400 for the 2010 and subsequent underwriting years of account,

are to be transferred to Alterra Bermuda;

"2009 Alterra Corporate 3 Syndicate 2526 QSA” means the quota share agreement effective as
of 1 January 2009, as amended, and made between (a) Alterra Corporate 3 and (b) Alterra
Bermuda pursuant to which 70% of the risks and profits written by Alterra Corporate 3 in
Lloyd’s Syndicate 2526 for the 2009 and subsequent underwriting years of account are to be
transferred to Alterra Bermuda;

"Accession Letter” means a letter in the form contained in Schedule 8;

"Account Party” means Alterra UK, unless one or more Additional Account Parties are
appointed at any time pursuant to Clause 3.10 in which case, unless the context otherwise
requires, the expression “Account Party” shall mean Alterra UK and such Additional Account
Party or Parties jointly and severally;

"Additional Account Party” means a Subsidiary of the Guarantor which becomes an additional
Account Party pursuant to Clause 3.10;

"Agent” means ING Bank N.V., London Branch, acting through its office at 60 London Wall,
London EC2M 5TQ;

"Alterra Bermuda” means Alterra Bermuda Ltd. (formerly known as Max Bermuda Ltd.), a company
incorporated in Bermuda with its registered office at Alterra House, 2 Front Street,
Hamilton, Bermuda;

"Alterra Corporate 2” means Alterra Corporate Capital 2 Limited (formerly known as Max
Corporate Capital 2 Limited, as Danish Re Capital Limited and as Imagine Corporate Capital 2
Limited), a company incorporated in England and Wales under company number 03703210 and with
its registered office at 70 Gracechurch Street, London EC3V 0XL;

"Alterra Corporate 2 Account Security Deed” means a security deed in respect of a Deposit
Account of Alterra Corporate 2 to be executed (if required) by Alterra Corporate 2 in
accordance with the relevant Quota Share Assignment(s) in a form substantially similar to
the Imagine Account Security Deed;

"Alterra Corporate 2 Control Agreement” means an account control agreement made between
Alterra Bermuda, Alterra Corporate 2, the Security Trustee and the Approved Custodian in
respect of the Alterra Corporate 2 QS Account, or any replacement agreement acceptable to
the Agent;

"Alterra Corporate 2 Pledge Agreement” means a pledge agreement made between Alterra
Bermuda, Alterra Corporate 2 and the Security Trustee pursuant to which Alterra Bermuda
pledges the Investment Collateral held in the Alterra Corporate 2 QS Account as security for
its obligations to Alterra Corporate 2;

"Alterra Corporate 2 Pledge Assignment” means a deed to be made between Alterra Corporate 2
and the Security Trustee pursuant to which Alterra Corporate 2 will assign by way of
security its rights under the Alterra Corporate 2 Pledge Agreement in favour of the Security
Trustee in a form acceptable to the Agent;

"Alterra Corporate 2 QS Account” means any investment account opened in the name of Alterra
Bermuda which is pledged in favour of Alterra Corporate 2 pursuant to the Alterra Corporate
2 Pledge Agreement and which is the subject of the Alterra Corporate 2 Control Agreement;

"Alterra Corporate 2 QSAs” means the 2007 Alterra Corporate 2 QSA, the 2009 Alterra
Corporate 2 Syndicate 1400 QSA, the 2009 Alterra Corporate 2 Syndicate 2526 QSA and any New
Alterra Corporate 2 QSAs;

"Alterra Corporate 3” means Alterra Corporate Capital 3 Limited (formerly known as Max
Corporate Capital 3 Limited), a company incorporated in England and Wales under company
number 4513846 and with its registered office at 70 Gracechurch Street, London EC3V 0XL;

"Alterra Corporate 3 Account Security Deed” means a security deed in respect of a Deposit
Account of Alterra Corporate 3 to be executed (if required) by Alterra Corporate 3 in
accordance with the relevant Quota Share Assignment(s) in a form substantially similar to
the Imagine Account Security Deed;

"Alterra Corporate 3 Control Agreement” means an account control agreement made between
Alterra Bermuda, Alterra Corporate 3, the Security Trustee and the Approved Custodian in
respect of the Alterra Corporate 3 QS Account, or any replacement agreement acceptable to
the Agent;

"Alterra Corporate 3 Pledge Agreement” means a pledge agreement made between Alterra
Bermuda, Alterra Corporate 3 and the Security Trustee pursuant to which Alterra Bermuda
pledges the Investment Collateral held in the Alterra Corporate 3 QS Account as security for
its obligations to Alterra Corporate 3;

"Alterra Corporate 3 Pledge Assignment” means a deed to be made between Alterra Corporate 3
and the Security Trustee pursuant to which Alterra Corporate 3 will assign by way of
security its rights under the Alterra Corporate 3 Pledge Agreement in favour of the Security
Trustee in a form acceptable to the Agent;

"Alterra Corporate 3 QS Account” means any investment account opened in the name of Alterra
Bermuda which is pledged in favour of Alterra Corporate 3 pursuant to the Alterra Corporate
3 Pledge Agreement and which is the subject of the Alterra Corporate 3 Control Agreement;

"Alterra Corporate 3 QSAs” means the 2009 Alterra Corporate 3 Syndicate 1400 QSA, the 2009
Alterra Corporate 3 Syndicate 2526 QSA and any New Alterra Corporate 3 QSAs;

"Alterra Holdings” means Alterra Capital Holdings Limited (formerly known as Max Capital
Group Ltd.), a company incorporated in Bermuda with its registered office at Alterra House,
2 Front Street, Hamilton, Bermuda;

"Alterra Holdings Account Security Deed” means the security deed in respect of Alterra
Holdings’ Deposit Account dated 28 October 2008 and executed by Alterra Holdings in favour
of the Security Trustee;

"Alterra UK” means Alterra Capital UK Limited (formerly known as Max UK Holdings Ltd), a
company incorporated in England and Wales under company number 05800142 and with its
registered office at 70 Gracechurch Street, London EC3V 0XL;

"Alterra UK Group” means Alterra UK and its Subsidiaries;

"AM Best” means AM Best Company Inc. or any successor to its rating business;

"Applicant” means Alterra UK or any other company approved by the Agent from time to time;

"Application” means an application for the issuance or amendment of a Letter of Credit by
the Issuing Bank and to be made substantially in the form attached in Schedule 4 or such
other form as the Agent may agree;

"Application Day” means any day on which an Application is received by the Agent;

"Approved Custodian” means Bank of New York Mellon acting through its office at 160 Queen
Victoria Street, London EC4V 4LA or at BNY Mellon Center, Pittsburgh, PA, 15258 and/or any
other bank or financial institution approved by the Agent after consulting with the Account
Party;

"Banking Day” means a day (excluding Saturdays and Sundays) on which dealings in deposits in
Pounds Sterling may be carried out in the London Interbank Market and on which banks and
foreign exchange markets are open for business in London and (in the case of payment) the
place to which such payment is required to be made;

"Banks” means those banks or financial institutions listed in Schedule 1 and a Transferee
Bank;

"Borrowing Base Certificate” means a certificate, substantially in the form of Schedule 7
with such amendments as the Agent may approve or any other form agreed to between the Agent
and the Account Party, in respect of the Investment Collateral;

"Charged Account” means any Deposit Account or Collateral Account which is either:

	 	(a)	 	subject to a Security Interest in favour of the Security Trustee pursuant to a
Deposit Account Security Deed or a Collateral Account Security Assignment; or

	 	(b)	 	subject to a Security Interest in favour of a Corporate Member pursuant to a
QSA Account Security Deed where the benefit of that QSA Account Security Deed has been
assigned to the Security Trustee by that Corporate Member pursuant to a QSA Account
Security Deed Assignment,

and in respect of which the requirements of Clause 13.12 (if applicable) have been
satisfied;

"Collateral Account” means the Existing Collateral Account, the Alterra Corporate 2 QS
Account, the Alterra Corporate 3 QS Account and any New Collateral Account;

"Collateral Account Security Assignment” means the Existing Security Assignment and any New
Collateral Account Security Assignment;

"Collateral Account Control Agreement” means:

	 	(a)	 	in relation to the Existing Collateral Account, the account control agreement
dated 9 December 2008 made between the Account Party, the Security Trustee and Bank of
New York Mellon as Approved Custodian;

	 	(b)	 	in relation to the Alterra Corporate 2 QS Account, the Alterra Corporate 2
Control Agreement;

	 	(c)	 	in relation to the Alterra Corporate 3 QS Account, the Alterra Corporate 3
Control Agreement; and

	 	(d)	 	in relation to any New Collateral Account, any other account control agreement
acceptable to the Agent;

"Coming Into Line Date” means, in relation to a Corporate Member for any year of account,
the last date prescribed by the Council of Lloyd’s (taking into account any extension which
may be permitted to the prescribed date) by which the Corporate Member must have provided
its FAL if it is to be eligible to underwrite or to continue to underwrite without
restriction (as the case may be) insurance business at Lloyd’s for such year of account;

"Commitment” means, in relation to a Bank, the amount set opposite its name in Schedule 1
or, as the case may be, the amount specified in any Transfer Certificate, to the extent not
reduced, cancelled, terminated or transferred in accordance with the provisions of this
Agreement, and “Total Commitments” means the aggregate of the Commitments of all the Banks;

"Commitment Period” means the period commencing on the date of this Agreement and ending on
the earlier of (a) 31 December 2011 and (b) the date on which the Commitments of the Banks
are cancelled in accordance with any applicable provision of this Agreement;

"Compliance Certificate” means a certificate substantially in the form of Schedule 6 setting
out, among other things, calculations of the financial covenants in Clause 14;

"Corporate Members” means the initial corporate members set out in Schedule 1 and any other
corporate member of Lloyd’s which, from time to time, is a Subsidiary of the Applicant and
writes business on the Syndicates;

"Creditor Parties” means, together, the Banks, the Issuing Bank, the Agent and the Security
Trustee;

"Custodial Account Certificate” means a certificate in such form as the Agent may approve
issued by an Approved Custodian in respect of the Investment Collateral held with it;

"Default Rate” means the annual rate of interest determined by the Agent to be equal to the
aggregate of 5% and LIBOR for periods of such duration as the Agent may, after consultation
with the Banks, reasonably determine from time to time;

"Deposit Account Security Deeds” means the Existing Deposit Account Security Deeds and any
New Deposit Account Security Deeds;

"Deposit Accounts” means the Existing Deposit Accounts and any New Deposit Account (and
shall in each case include each account, whether designated as such or not, opened by any
relevant person at the request of the Agent with the Agent or any Bank or with any branch,
sub branch or subsidiary of the Agent or any Bank, as well as any sub accounts to which
funds in any of the said accounts may be allocated from time to time for currency or deposit
purposes);

"Dollars” or “$” means the lawful currency from time to time of the United States of
America;

"Encumbrance” means any mortgage, charge (whether fixed or floating), pledge, lien,
hypothecation, assignment or Security Interest or any other agreement or arrangement having
a similar effect;

"Event of Default” means any of the events listed in Clause 15.1;

"Existing Collateral Account” means the account number MXLF2001002 of Alterra UK with Bank
of New York Mellon acting through its office at 160 Queen Victoria Street, London EC4V 4LA;

"Existing Deposit Accounts” means:

	 	(a)	 	the Pounds Sterling account with account number 261725 held by Alterra UK with
the Agent and being the subject of the Imagine Account Security Deed; and

	 	(b)	 	the Pounds Sterling account with account number 254052 held by Alterra Holdings
with the Agent and being the subject of the Alterra Holdings Account Security Deed;

"Existing Deposit Account Security Deeds” means the Imagine Account Security Deed and the
Alterra Holdings Account Security Deed;

"Existing Quota Share Assignments” means, together, the assignments by way of charge in
favour of the Security Trustee of the Alterra Corporate 2 QSAs and the Alterra Corporate 3
QSAs made by the Corporate Members as follows:

	 	(a)	 	the assignment dated 5 December 2008 made by Alterra Corporate 2 in respect of
the 2007 Alterra Corporate 2 QSA;

	 	(b)	 	the assignment dated 5 December 2008 made by Alterra Corporate 2 in respect of
the 2009 Alterra Corporate 2 Syndicate 1400 QSA;

	 	(c)	 	the assignment dated 30 March 2010 made by Alterra Corporate 2 in respect of
the 2009 Alterra Corporate 2 Syndicate 2526 QSA;

	 	(d)	 	the assignment dated 30 March 2010 made by Alterra Corporate 3 in respect of
the 2009 Alterra Corporate 3 Syndicate 1400 QSA; and

	 	(e)	 	the assignment dated 30 March 2010 made by Alterra Corporate 3 in respect of
the 2009 Alterra Corporate 3 Syndicate 2526 QSA;

"Existing Security Assignment” means the security assignment dated 5 December 2008 made
between Alterra UK and the Security Trustee in relation to the Investment Collateral of
Alterra UK and the Existing Collateral Account;

"Facility” means the letter of credit facility of up to £60,000,000 to be made available by
the Banks to the Account Party under this Agreement and, as the context may require, means
the available amount of such facility from time to time under this Agreement;

"FAL” means funds at Lloyd’s supporting underwriting as a member of the Syndicates for any
applicable year of account as required by Lloyd’s pursuant to Lloyd’s Rules;

"Fee Letter” means the letter dated on or about the Restatement Date and addressed by the
Agent to the Account Party in relation to certain fees payable to the Creditor Parties under
this Agreement;

"Finance Documents” means this Agreement, the Amending and Restating Agreement, the Fee
Letter, each QSA Account Security Deed, each Collateral Account Control Agreement, each of
the other documents specified in Clause 11 and any and every other document from time to
time executed to secure, or to establish a subordination or priorities arrangement in
relation to, all or any of the obligations of any person to the Creditor Parties (or any of
them) under this Agreement or any other Finance Documents;

"Financial Indebtedness” means any indebtedness in respect of:

	 	(a)	 	moneys borrowed or raised and interest thereon or any debit balances at any
bank or financial institution;

	 	(b)	 	any bond, bill of exchange, note, loan stock, debenture, commercial paper or
similar security or instrument;

	 	(c)	 	acceptance, documentary credit or guarantee facilities;

	 	(d)	 	deferred payments for assets or services acquired if the primary reason
behind the arrangement is to raise finance;

	 	(e)	 	rental payments so far as attributable to payment of capital under finance
leases, whether in respect of land, buildings, machinery or equipment or otherwise;

	 	(f)	 	payments under hire purchase contracts;

	 	(g)	 	factored debts, to the extent that there is recourse;

	 	(h)	 	guarantees, bonds, standby letters of credit or other instruments issued in
connection with the performance of contracts or obligations;

	 	(i)	 	any interest or currency swap or any other form of derivative transaction;

	 	(j)	 	(without double counting) guarantees, indemnities or other assurances against
financial loss in respect of indebtedness of any person falling within any of
paragraphs (a) to (i) inclusive above; and

	 	(k)	 	amounts raised or obligations incurred under any other transaction having the
commercial effect of any of the above;

but not (i) any contract of insurance or reinsurance having the commercial effect of any of
the above or (ii) any guarantee or other instrument or payment in connection with the
performance of any contract of insurance or reinsurance or any obligation thereunder.

"Group” means Alterra Holdings and its Subsidiaries;

"Guarantor” means Alterra Holdings;

"Hedging Obligations” means with respect to any person, the net liability of such person
under any futures contract or options contract (including property catastrophe futures and
options), interest rate swap agreements and interest rate collar agreements and all other
agreements or arrangements for non-speculative purposes designed to protect such person
against catastrophic events, fluctuations in interest rates or currency exchange rates that
are entered into in the ordinary course of business;

"Imagine Account Security Deed” means the security deed in respect of Alterra UK’s Deposit
Account dated 5 December 2008 and executed by Alterra UK in favour of the Security Trustee;

"Indebtedness” means any obligation for the payment or repayment of moneys, whether present
or future, actual or contingent, sole or joint;

"Investment Collateral” means the cash, securities, investments and other collateral listed
in Schedule 5 held in one or more Charged Accounts, being acceptable as collateral cover to
the extent indicated by the applicable advance rate specified therein, which:

	 	(a)	 	in the case of cash, is held either held with an Approved Custodian in a
Collateral Account or with the Agent in a Deposit Account (in the Account Party’s
option); and

	 	(b)	 	in the case of non-cash collateral, is held with an Approved Custodian in a
Collateral Account and which is capable of being marked to market on a daily basis;

"Issuance Date” means, in relation to a Letter of Credit, the Banking Day on which the
Applicant specifies in the relevant Application that it wishes that a Letter of Credit be
issued or (as the case may be) amended by the Issuing Bank or (as the context requires) the
date on which that Letter of Credit is actually issued or (as the case may be) amended by
the Issuing Bank;

"Issuing Bank” means ING Bank N.V., London Branch, acting through its office at 60 London
Wall, London EC2M 5TQ;

"Letter of Credit” means any letter of credit issued or to be issued by the Issuing Bank (on
behalf of the Banks) at the request of the Account Party pursuant to this Agreement in the
form required by Lloyd’s and which, subject to extension in accordance with its terms, shall
expire no later than 31 December 2015;

"LIBOR” means, in respect of a period:

	 	(a)	 	the applicable Screen Rate; or

	 	(b)	 	(if no Screen Rate is available for that period) the arithmetic mean of the
rates (rounded upwards to four decimal places) quoted to the Agent by leading banks in
the London interbank market,

at or about 11.00 a.m. London time 2 Banking Days before the commencement of that period for
the offering of deposits in Sterling in an amount comparable to the Facility or relevant
part thereof or other relevant sum (as the case may be) and for a period comparable to that
period;

"Lloyd’s” means the Society incorporated by the Lloyd’s Act 1871 by the name of Lloyd’s;

"Lloyd’s Rules” means Lloyd’s Acts 1871-1982 and the byelaws and regulations (including, if
applicable, Financial Services Authority regulations) of Lloyd’s applicable and in force
from time to time;

"Lloyd’s Security and Trust Deed” means any deed which Lloyd’s may from time to time require
the Account Party or a Corporate Member to execute for the purpose of providing FAL;

"Majority Banks” means, at any time, Banks the aggregate of whose Commitments exceeds
66 % (or, for the purposes of Clauses 13, 22, 26 and 28, 50%) of the Total
Commitments at such time;

"Managing Agent” means Alterra at Lloyd’s Limited, a company incorporated in England and
Wales under company number 3304600 (or such other company (with the consent of all the
Banks) as may become managing agent of the Syndicates in succession to Alterra at Lloyd’s
Limited);

"Moody’s” means Moody’s Investors Services’ rating services or any successor to its rating
business;

"New Alterra Corporate 2 QSA” means any quota share agreement, in a form complying with the
requirements of Clause 13.11, executed from time to time after the Restatement Date in
respect of the 2012 underwriting year of account made between (i) Alterra Bermuda as
reinsurer and (ii) Alterra Corporate 2 as reinsured in respect of its underwriting as a
member of any of the Syndicates;

"New Alterra Corporate 3 QSA” means any quota share agreement, in a form complying with the
requirements of Clause 13.11, executed from time to time after the Restatement Date in
respect of the 2012 underwriting year of account made between (i) Alterra Bermuda as
reinsurer and (ii) Alterra Corporate 3 as reinsured in respect of its underwriting as a
member of any of the Syndicates;

"New Collateral Account” means any account held by an Obligor with the Agent or an Approved
Custodian (other than the Existing Collateral Account) and which has been designated by the
Account Party (with the consent of the Agent) as a “ Collateral Account” for the purposes of
this Agreement;

"New Collateral Account Security Assignment” means, in respect of a Collateral Account
(other than the Existing Collateral Account), a security assignment executed by the relevant
account holder over that Collateral Account in favour of the Security Trustee in a form
substantially similar to the Existing Security Assignment;

"New Deposit Account” means:

	 	(a)	 	the Pounds Sterling account of Alterra Corporate 2 to be opened (if required)
with the Agent in accordance with the relevant Quota Share Assignment(s) (being the
subject of the Alterra Corporate 2 Account Security Deed);

	 	(b)	 	the Pounds Sterling account of Alterra Corporate 3 to be opened (if required)
with the Agent in accordance with the relevant Quota Share Assignment(s) (being the
subject of the Alterra Corporate 3 Account Security Deed); and

	 	(c)	 	any other account held by an Obligor with the Agent (other than an Existing
Deposit Account) and which has been designated by the Account Party (with the consent
of the Agent) as a “Deposit Account” for the purposes of this Agreement;

"New Deposit Account Security Deed” includes the Alterra Corporate 2 Account Security Deed
and the Alterra Corporate 3 Account Security Deed (in each case, if executed) and means, in
respect of a New Deposit Account, a security deed executed over that New Deposit Account by
the relevant account holder in favour of the Security Trustee in a form substantially
similar to the Imagine Account Security Deed;

"New Quota Share Agreement” means any New Alterra Corporate 2 QSA and any New Alterra
Corporate 3 QSA;

"New Quota Share Assignment” means, in respect of a New Quota Share Agreement, the
assignment by way of charge to be executed over that New Quota Share Agreement by the
relevant Corporate Member in favour of the Security Trustee in a form substantially similar
to the Existing Quota Share Assignments;

"Obligor” means the Guarantor and any Subsidiary of the Guarantor, other than Alterra
Bermuda and Alterra at Lloyd’s Limited, which is a party from time to time to any of the
Finance Documents which has not been released from all obligations to the relevant Creditor
Parties thereunder other than any Creditor Party (including, for the avoidance of doubt,
Alterra UK);

"Outstanding Indebtedness” means the aggregate of the maximum amounts for which the Banks
are or may be liable, actually or contingently, under all Letters of Credit and all other
sums of money whatsoever from time to time due or owing, actually or contingently, to the
Creditor Parties under or pursuant to the Finance Documents;

"Permitted Encumbrance” means:

	 	(a)	 	any Encumbrance granted or subsisting under any deed or agreement required by
Lloyd’s to be executed or entered into by or on behalf of any Obligor in connection
with the insurance business at Lloyd’s or the membership of Lloyd’s of a Corporate
Member;

	 	(b)	 	any Encumbrance created by or pursuant to the Finance Documents;

	 	(c)	 	any Encumbrance that replaces a Permitted Encumbrance if such new Encumbrance
does not secure a greater sum than the existing Encumbrance;

	 	(d)	 	any netting or set-off arrangement entered into by the Account Party in the
ordinary course of its banking arrangements for the purpose of netting debit and
credit balances; and

	 	(e)	 	a lien arising solely by operation of law incurred in the ordinary course of
business and not in connection with the borrowing of money, for sums not yet overdue;

"Potential Event of Default” means an event or circumstance which, with the giving of any
notice, lapse of time, determination of the Agent in accordance with the relevant provisions
of the Finance Documents or satisfaction of any other condition would constitute an Event of
Default;

"Pounds Sterling” or “£” means the lawful currency from time to time of the United Kingdom;

"Primary FAL” means, in respect of a Corporate Member, all FAL of that Corporate Member
which is available to cover losses of the Syndicates (or any of them) other than the FAL
constituted by the Letters of Credit;

"Quota Share Agreements” means, together, the Alterra Corporate 2 QSAs and the Alterra
Corporate 3 QSAs and “Quota Share Agreement” means the relevant one of them;

"Quota Share Assignments” means the Existing Quota Share Assignments and any New Quota Share
Assignment;

"Quotation Day” means in relation to any period for which an interest rate is to be
determined, the first day of that period;

"QSA Account Security Deed” means the Alterra Corporate 2 Pledge Agreement, the Alterra
Corporate 3 Pledge Agreement and, in respect of any Investment Collateral deposited in a
Collateral Account or Deposit Account as security for the obligations of the Reinsurer to a
Corporate Member under any Quota Share Agreement, a security deed or pledge agreement in
respect of that Investment Collateral and the relevant Collateral Account or Deposit Account
executed by the relevant account holder in favour of the relevant Corporate Member in the
agreed form;

"QSA Account Security Deed Assignment” means the Alterra Corporate 2 Pledge Assignment, the
Alterra Corporate 3 Pledge Assignment and, in respect of a QSA Account Security Deed, the
assignment by way of security by the relevant Corporate Member of its rights under that QSA
Account Security Deed in favour of the Security Trustee in the agreed form;

"RDS” means a realistic disaster scenario prescribed from time to time by Lloyd’s and in
respect of which, pursuant to Lloyd’s Rules, the Managing Agent is obliged to prepare and
submit to Lloyd’s a report;

"Reference Date” shall have the meaning given to such term in Clause 14.7.1;

"Reinsurer” means, in respect of any Quota Share Agreement, the party which is the reinsurer
thereunder being Alterra Bermuda or, in the case of the 2007 Alterra Corporate 2 QSA (unless
replaced by a replacement quota share agreement entered into by Alterra Bermuda), Imagine
Insurance Company Limited;

"Relevant Corporate Member” means a Corporate Member whose FAL includes one or more Letters
of Credit;

"Restatement Date” means 16 December 2010;

"Screen Rate” means, for any period, the British Bankers’ Association Interest Settlement
Rate for Pounds Sterling for the relevant period, displayed on the appropriate page of the
Reuters screen. If the agreed page is replaced or service ceases to be available, the Agent
may specify another page or service displaying the appropriate rate after consultation with
the Account Party;

"Security Interest” means any mortgage, pledge, lien, charge, assignment, hypothecation or
security interest or any other agreement or arrangement having a similar effect;

"Security Period” means the period from the date of this Agreement until the discharge of
the security (if any) created by the Finance Documents by final and irrevocable repayment or
payment in full of the Outstanding Indebtedness or its extinguishment by expiry of all the
Letters of Credit;

"Security Trustee” means ING Bank N.V., London Branch, acting through its office at 60
London Wall, London EC2M 5TQ;

"Service Bank” means the Agent or the Security Trustee;

"S&P” means Standard & Poor’s rating services, a division of The McGraw-Hill Companies, Inc.
or any successor to its rating business;

"Subsidiary” has the meaning given to such term in section 1159 of the Companies Act 2006;

"Subsidiary Undertaking” shall have the meaning given to such expression in section 1162 of
the Companies Act 2006;

"Syndicates” means the syndicates at Lloyds 1400, 2525 and 2526 (2011 and 2012 years of
account and prior open years of account to the extent that a Corporate Member is still
required to maintain funds at Lloyd’s in respect of its participation thereon) and any other
syndicate at Lloyd’s of which the Managing Agent is the managing agent;

"Tax” means any tax, levy, impost, duty or other charge or withholding of a similar nature
(including any related penalty or interest);

"Tax Credit” shall have the meaning given to such term in Clause 6.4.1;

"Tax Deduction” means a deduction or withholding for or on account of Tax from a payment
under a Finance Document;

"Tax Payment” means a payment made by an Obligor to a Finance Party in any way relating to a
Tax Deduction or under any indemnity given by that Obligor in respect of Tax under any
Finance Document;

"Transfer Certificate” means a transfer certificate in the form set out in Schedule 3 with
any modifications or amendments approved or required by the Agent;

"US GAAP” means generally accepted accounting principles set forth from time to time in the
opinions and pronouncements of the Accounting Principles Board and the American Institute of
Certified Public Accountants and statements and pronouncements of the Financial Accounting
Standards Board (or agencies with similar functions of comparable stature and authority
within the U.S. accounting profession, which are applicable to the circumstances as of the
date of determination);

"Valuation Report” means a valuation report issued by an Approved Custodian in respect of
the Investment Collateral held with it, such report to be in a form acceptable to the Agent.

	1.2	 	Construction of certain expressions

The following expressions shall be construed in the following manner:

"approved” means approved in writing by the Agent, with the authorisation of the applicable
Majority Banks;

"Account Party”, “Applicant”, “Corporate Member”, “Guarantor” and “Obligor” include their
respective legal personal representatives, administrators, successors and permitted assigns;

"Agent”, “Bank”, “Creditor Party”, “Issuing Bank” and “Security Trustee” include their
respective successors and assigns; and

	 	 	 
	1.3

	 	"person” includes a corporate entity and any body of persons, corporate or unincorporated.

General interpretation

In this Agreement:

	 	1.3.1	 	unless the context otherwise requires, words in the singular include the
plural and vice versa;

	 	1.3.2	 	references to any document include the same as varied, supplemented or
replaced from time to time;

	 	1.3.3	 	references to any enactment include re-enactments, amendments and extensions
thereof;

	 	1.3.4	 	clause headings are for convenience of reference only and are not to be taken
into account in construction;

	 	1.3.5	 	unless otherwise specified, references to Clauses, Recitals and Schedules are
respectively to Clauses of and Recitals and Schedules to this Agreement;

	 	1.3.6	 	any document expressed to be “in the agreed form” means a document in a form
approved by (and for the purposes of identification initialled and/or signed by or on
behalf of) the Account Party (or other Obligor) and the Agent or (in the case of any of
the Finance Documents where appropriate) a document in the form actually executed by
both the relevant Obligor and, if appropriate, the Security Trustee;

	 	1.3.7	 	references to periods of “months” shall mean a period beginning in one
calendar month and ending in the relevant calendar month on the day numerically
corresponding to the day of the calendar month in which such period started, provided
that (a) if such period started on the last Banking Day in a calendar month, or if
there is no such numerically corresponding day, such period shall end on the last
Banking Day in the relevant calendar month and (b) if such numerically corresponding
day is not a Banking Day, such period shall end on the next following Banking Day in
the same calendar month, or if there is no such Banking Day, such period shall end on
the preceding Banking Day (and “month” and “monthly” shall be construed accordingly);

	 	1.3.8	 	an Event of Default or a Potential Event of Default is “continuing” if it has
not been remedied to the reasonable satisfaction of the Agent or waived.

	1.4	 	Third party rights

A person who is not a party to this Agreement may not enforce, or otherwise have the benefit
of, any provision of this Agreement under the Contracts (Rights of Third Parties) Act 1999.

	2.	 	THE FACILITY — GENERAL PROVISIONS

	2.1	 	Overall maximum limit

The overall maximum limit of the Facility shall not exceed £60,000,000 and, unless the Agent
(with the approval of all of the Banks) otherwise agrees in writing, no Letter of Credit
shall be issued or amended to increase its face value if such limit has been or would
thereby be exceeded.

	2.2	 	Banks’ participations

Subject to the provisions of this Agreement, each Bank will participate in the Facility by
indemnifying the Issuing Bank in respect of the Letters of Credit up to an aggregate maximum
principal amount not exceeding its Commitment and in the proportion which its Commitment
bears to the Total Commitments.

	2.3	 	Cancellation

The Account Party, if it gives the Agent not less than 5 Banking Days’ prior notice, may
cancel the whole or any part of the undrawn portion of the Facility and/or procure the full
or partial release by Lloyd’s of any Letter of Credit provided that any such partial
cancellation or release must be in a minimum amount or an integral multiple of £5,000,000.
Any cancellation or release under this Clause 2.3 shall reduce the Commitments of the Banks
pro rata.

	2.4	 	Position after expiry of Commitment Period

After the date of expiry of the Commitment Period, no Letter of Credit may be issued or
amended to extend its term or increase its face value.

	2.5	 	Obligations of Creditor Parties several

The obligations of each Creditor Party under this Agreement and the other Finance Documents
are several and, accordingly:

	 	2.5.1	 	no Creditor Party shall be liable for the failure of any other Creditor Party
to perform its obligations under this Agreement or any of the other Finance Documents;
and

	 	2.5.2	 	the failure of a Creditor Party to perform any of its obligations under this
Agreement or any of the other Finance Documents shall not relieve any other Creditor
Party or any Obligor from any of their respective obligations hereunder or thereunder.

	2.6	 	Rights of Creditor Parties several

The rights and interests of each Creditor Party under this Agreement and the other Finance
Documents are several and, accordingly, notwithstanding any provision to the contrary herein
or therein:

	 	2.6.1	 	the aggregate of the amounts outstanding at any time under this Agreement and
the other Finance Documents to each Creditor Party shall be due as a separate and
independent debt; and

	 	2.6.2	 	each Creditor Party shall have the right to sue for any amount due and payable
to it from the Account Party or any other Obligor under this Agreement or any of the
other Finance Documents and it shall not be necessary for any other Creditor Party to
be joined as an additional party in any proceedings to that end.

	2.7	 	Restrictions on other proceedings by individual Creditor Parties

No Creditor Party shall, except with the prior written consent of the Majority Banks, bring
any proceedings (other than pursuant to Clause 2.6.2) against the Account Party or any other
Obligor in respect of any other claim (whether in contract, tort or otherwise) which that
Creditor Party may have under or in connection with this Agreement or any of the other
Finance Documents.

	2.8	 	Parties bound by certain actions of the Majority Banks

Each Creditor Party, the Account Party and each other Obligor shall be bound in the absence
of manifest error by:

	 	2.8.1	 	any determination made, or action taken, by the applicable Majority Banks
under any discretion conferred on such Majority Banks by any provision of a Finance
Document;

	 	2.8.2	 	any instruction or authorisation given by the applicable Majority Banks to the
Issuing Bank, the Agent or the Security Trustee under or in connection with any Finance
Document; and

	 	2.8.3	 	any action taken (or in good faith purportedly taken) by the Issuing Bank, the
Agent or the Security Trustee in accordance with such an instruction or authorisation.

	3.	 	THE FACILITY — SPECIFIC PROVISIONS

	3.1	 	Purpose

Subject to the provisions of this Agreement, the Issuing Bank (on behalf of the Banks)
agrees to issue Letters of Credit which will form part of the FAL of the Corporate Members
in respect of the Syndicates only.

	 	 	 	 	 	 	 
	3.2	 	Currency and amount
	
 
	 	 	3.2.1	 	 	The currency specified in an Application must be Pounds Sterling.

	 	3.2.2	 	The amount of a proposed Letter of Credit as specified in an Application must
be in an amount which is not more than the maximum available amount of the Facility.

	3.3	 	Application required

If the Applicant wishes the Issuing Bank (on behalf of the Banks) to issue or amend a Letter
of Credit, it must make an Application and give it to the Agent not later than 10:00 a.m.
London Time 4 Banking Days before the proposed Issuance Date. Each Application shall:

	 	 	 	 	 
	 	3.4	 	 	3.3.1be effective on receipt by the Agent;

3.3.2constitute a representation and warranty in the terms of Clause 12; and

3.3.3be irrevocable.

Condition of effectiveness of Applications

No Application made pursuant to this Clause 3 shall be considered effective until all the
applicable conditions precedent set out in Clause 10 have been satisfied.

	3.5	 	Issuance of Letters of Credit

Subject to the provisions of this Agreement and, in particular, but without limitation,
Clause 2.1, the Issuing Bank (on behalf of the applicable Banks) will issue or (as the case
may be) amend each Letter of Credit on the applicable Issuance Date in accordance with the
Application made by the Applicant provided that the Issuance Date must fall on a Banking Day
during the Commitment Period.

	3.6	 	Order of Application of Funds at Lloyd’s

It is acknowledged by the Account Party that, subject to the duties of Lloyd’s as a trustee
of all such FAL and to any conditions and requirements prescribed under the membership
byelaw (No. 5 of 2005) which are for the time being applicable, the FAL of the Account Party
will, to the extent that the Obligors are able to procure the same upon and subject to the
terms of this Agreement, be applied in the following order of application:

	 	3.6.1	 	FIRST, the Primary FAL; and

	 	3.6.2	 	SECOND, the Letters of Credit issued pursuant to this Agreement upon the
Application of the Account Party.

	3.7	 	Account Party’s option to provide collateral cover

	 	3.7.1	 	Subject to giving at least 5 Banking Days written notice to the Agent, the
Account Party shall have the option of depositing, or procuring that the Guarantor or
Alterra Bermuda deposits, Investment Collateral in a Charged Account with an Approved
Custodian or (in the case of cash only) the Agent.

	 	3.7.2	 	The Account Party, subject to there being no continuing Event of Default, may
request the Agent to vary the extent to which Letters of Credit are secured (or not
secured as the case may be) by Investment Collateral, or to exchange one form of
Investment Collateral for another form of Investment Collateral, or to transfer
Investment Collateral in the form of cash from a Collateral Account to a Deposit
Account (and vice versa), or to transfer Investment Collateral to Lloyd’s to reduce the
amount of any Letter of Credit, by giving at least 5 Banking Days written notice to the
Agent and such variation or exchange or transfer shall take effect, for all purposes
under this Agreement, as from the first day of the next following month.

	 	3.7.3	 	If at any time the Managing Agent makes a cash call on a Corporate Member and
the circumstances are such that, if that cash call were not satisfied by that Corporate
Member, Lloyd’s would demand payment under any Letter of Credit then, at the request of
the Account Party and upon receiving from the Account Party evidence of those
circumstances, the Security Trustee shall:

	 	(a)	 	cause cash comprising part of the Investment Collateral to be
applied in discharge of that cash call (or non-cash Investment Collateral to the
extent that the cash component of the Investment Collateral is insufficient for
that purpose); and/or

	 	(b)	 	notwithstanding the terms of the Quota Share Assignments, permit
any payment that becomes due to that Corporate Member under any of the Quota
Share Agreements by reason of that cash call to be made to the appropriate
account of a Syndicate in or towards discharge thereof;

in each case, in a maximum amount equal to the payment that would be demanded by
Lloyd’s under such Letter of Credit if that cash call were not satisfied by that
Corporate Member.

	3.8	 	Value of Investment Collateral

For the purposes of this Agreement, the value of the Investment Collateral from time to time
shall be calculated by the Agent, as often as it deems necessary, using its reasonable
credit judgement, by reference to any information that the Agent deems appropriate
(including, but not limited to, the most recent Custodial Account Certificates, Valuation
Reports and Borrowing Base Certificate), but in the event of challenge by the Account Party
as to the value of any Investment Collateral held with an Approved Custodian, it shall, in
the absence of manifest error, be conclusively determined by that Approved Custodian using
normal pricing sources.

For the avoidance of doubt, the aggregate value that is attributed for the purposes of this
Agreement to any Investment Collateral which is subject to a Security Interest in favour of
a Corporate Member pursuant to a QSA Account Security Deed and which has been assigned to
the Security Trustee by that Corporate Member pursuant to a QSA Account Security Deed
Assignment shall not exceed the maximum aggregate amount recoverable from the Reinsurer
under the relevant Quota Share Agreement or Quota Share Agreements and which has been
secured by that Security Interest.

	3.9	 	Mandatory cancellation — change of control

	 	3.9.1	 	For the purposes of this Clause 3.9, a “change of control” occurs if, Alterra
Holdings ceases to be the beneficial owner directly or indirectly of the whole of the
issued share capital of the Account Party and Alterra Bermuda.

	 	3.9.2	 	The Account Party must promptly notify the Agent if it becomes aware of any
change of control.

	 	3.9.3	 	After a change of control, if all the Banks so require, the Agent may, by
written notice to the Account Party:

	 	(a)	 	declare the commitment of the Issuing Bank to issue or amend any
Letter of Credit cancelled, whereupon such commitment shall be cancelled and the
Total Commitments shall be cancelled accordingly;

	 	(b)	 	enter into any agreement or arrangement which the Banks shall
think fit for the cancellation, discharge, release, reduction, compromise and/or
return of any or all of the Letters of Credit then outstanding and/or any actual
or contingent obligation or liability thereunder; and

	 	(c)	 	demand that the Account Party provide (or procure the provision
of) Investment Collateral in an amount equal to the face value of each issued
Letter of Credit (and the Account Party shall comply with such demand within 2
Banking Days of its receipt).

	 	 	 	 	 
	 	3.10	 	 	Any such notice will take effect in accordance with its terms.

Additional Account Parties

An Account Party may request that any Subsidiary of Alterra Holdings becomes an additional
Account Party and such Subsidiary will become an Account Party if:

	 	3.10.1	 	the Banks approve the addition of that Subsidiary (such approval not to be
unreasonably withheld or delayed in the case of a wholly owned Subsidiary of an Account
Party);

	 	3.10.2	 	that Subsidiary delivers to the Agent a duly completed and executed Accession Letter;

	 	3.10.3	 	each Account Party confirms to the Agent that no Event of Default is continuing or
would occur as a result of that Subsidiary becoming an Additional Account Party; and

	 	3.10.4	 	the Agent has received such documents and other evidence as it shall reasonably
request in relation to that Subsidiary, each in form and substance satisfactory to the
Agent (acting reasonably and promptly).

	3.11	 	Termination of Funds at Lloyd’s Letters of Credit

The Issuing Bank may, in its absolute discretion, at any time up to and including 31
December 2011, serve notice on Lloyd’s giving 4 years notice of termination of a Letter of
Credit, in accordance with the terms of the Letter of Credit.

	4.	 	CONDITIONS APPLICABLE TO LETTERS OF CREDIT

	4.1	 	Terms of Letters of Credit

Each Letter of Credit shall be in such terms as are permitted by Lloyd’s for letters of
credit supporting FAL.

	4.2	 	Authority to Issuing Bank to pay

The Issuing Bank is hereby authorised, without any further reference to or further authority
from the Account Party, to pay or accept for the account of the Account Party all drafts,
demands or other instruments whatsoever (each a “draft”) drawn or made or purporting to be
drawn or made under any Letter of Credit, provided that such authorisation shall be without
prejudice to the obligation of the Issuing Bank to perform its duties under the
International Standby Practices, International Chamber of Commerce Publication No 590, 1998
(or to any subsequent revision to which a Letter of Credit may be expressed to be subject)
and to the conditions of the relevant Letter of Credit, subject to Clause 4.6.

	4.3	 	Reimbursement

The Account Party shall (a) forthwith reimburse the Issuing Bank (on behalf of the Banks) on
demand the amount paid on a draft drawn or made or purporting to be drawn or made under any
Letter of Credit or, if so required by the Issuing Bank, immediately pay in advance (but no
more than one Banking Day before payment by the Issuing Bank is due) to the Issuing Bank, or
as the Issuing Bank may direct, the amount which is or may be payable on such draft, and (b)
in the case of each acceptance promptly pay to the Issuing Bank or as the Issuing Bank may
direct on demand, but in any event not later than one Banking Day before maturity at the
place for payment, the amount payable by reason of such acceptance provided always that:

	 	4.3.1	 	subject to paragraph 4.3.2, the Account Party may direct the Issuing Bank to
apply any Investment Collateral in settlement of such reimbursement obligation or
payment obligation; but

	 	4.3.2	 	the Issuing Bank will not be obliged to use any Investment Collateral in
settlement of such reimbursement obligation except to the extent that the value of the
Investment Collateral (given pursuant to Clause 3.7) exceeds the outstanding amount of
all the Letters of Credit issued at the time.

	4.4	 	Account Party’s indemnity

Without limiting Clause 4.3, the Account Party shall indemnify the Issuing Bank and hold it
harmless from and against all claims, demands, actions, losses, liabilities, damages, costs,
expenses, fees, commissions, charges and other sums of whatsoever nature (including legal
fees and expenses on a full indemnity basis) which it may incur or pay in acting as the
Issuing Bank for any Letter of Credit (otherwise than by the Issuing Bank’s fraud,
misconduct or negligence), including but not limited to any liability or sum as aforesaid
which it may incur or pay to any confirming, advising or negotiating bank and shall
forthwith provide the Issuing Bank with funds to meet any liability or pay any sum as
aforesaid.

	4.5	 	Banks’ indemnities

	 	4.5.1	 	Each Bank shall (according to its Commitment) immediately on demand indemnify
the Issuing Bank against any cost, loss or liability incurred by the Issuing Bank
(otherwise than by reason of the Issuing Bank’s fraud, misconduct or negligence) in
acting as the Issuing Bank under any Letter of Credit (unless the Issuing Bank has been
reimbursed by an Obligor pursuant to a Finance Document).

	 	4.5.2	 	The obligations of each Bank under this Clause are continuing obligations and
will extend to the ultimate balance of sums payable by that Bank in respect of any
Letter of Credit, regardless of any intermediate payment or discharge in whole or in
part.

	 	4.5.3	 	The obligations of any Bank under this Clause will not be affected by any act,
omission, matter or thing which, but for this Clause, would reduce, release or
prejudice any of its obligations under this Clause (without limitation and whether or
not known to it or any other person) including:

	 	(a)	 	any time, waiver or consent granted to, or composition with, any
Obligor, any beneficiary under a Letter of Credit or other person;

	 	(b)	 	the release of any other Obligor or any other person under the
terms of any composition or arrangement with any creditor or any Obligor;

	 	(c)	 	the taking, variation, compromise, exchange, renewal or release
of, or refusal or neglect to perfect, take up or enforce, any rights against, or
security over assets of, any Obligor, any beneficiary under a Letter of Credit
or other person or any non-presentation or non-observance of any formality or
other requirement in respect of any instrument or any failure to realise the
full value of any security;

	 	(d)	 	any incapacity or lack of power, authority or legal personality
of or dissolution or change in the members or status of an Obligor, any
beneficiary under a Letter of Credit or any other person;

	 	(e)	 	any amendment (however fundamental) or replacement of a Finance
Document, any Letter of Credit or any other document or security;

	 	(f)	 	any unenforceability, illegality or invalidity of any obligation
of any person under any Finance Document, any Letter of Credit or any other
document or security; or

	 	(g)	 	any insolvency or similar proceedings.

	 	 	 	 	 	 	 
	4.6	 	Exclusion of Bank's liability
	
 
	 	 	4.6.1	 	 	Each Letter of Credit shall be opened entirely at the risk of the Account Party.

	 	4.6.2	 	Any action taken or omitted by the Issuing Bank or any of its correspondents
or agents under or in connection with any Letter of Credit, if taken or omitted in good
faith and in the absence of fraud, misconduct or negligence, shall be binding on the
Account Party and shall not place the Issuing Bank under any liability to the Account
Party.

	 	4.6.3	 	Without prejudice to the provisions of Clause 4.6.2, in the event of any
uncertainty or ambiguity in any instructions given to the Issuing Bank in any
instructions, the Issuing Bank may, at its discretion, either (a) act upon its
understanding of the meaning of such instructions, or (b) take no action until the
Account Party clarifies such instructions to the Issuing Bank’s satisfaction. The
Issuing Bank shall not be held liable for any losses incurred by the Account Party as a
result of any action which the Issuing Bank takes in the light of such instructions in
the absence of fraud, misconduct or negligence on its part.

	4.7	 	Provision of information

The Account Party undertakes to inform and keep the Agent informed of any material fact or
circumstance which will or may be likely to give rise to a draft being drawn or made under
any Letter of Credit immediately upon its becoming aware of such material fact or
circumstance.

	4.8	 	Propriety of demand

The Issuing Bank shall be entitled to rely without further enquiry on any demand, claim,
document or other communication believed by it in good faith to be genuine and correct and
to have been signed or otherwise executed or made by the proper person and otherwise to be
in conformity with a Letter of Credit.

	4.9	 	Incorporation of ISP 1998 and conditions of Application

The Account Party agrees that the International Standby Practices, International Chamber of
Commerce Publication No 590, 1998 and the conditions of the relevant Application shall apply
to each Letter of Credit. In the case of any conflict between the provisions of this
Agreement on the one hand and that publication and/or of the Application on the other, the
provisions of this Agreement shall prevail.

	4.10	 	Payments and interest

The Account Party shall pay to the Issuing Bank (as agent for and on behalf of the Banks) on
demand from time to time all amounts payable by the Account Party under Clauses 4.3 and 4.4
together with interest at the Default Rate on each such amount from the date of the Issuing
Bank’s payment until the date of the Account Party’s payment to the Issuing Bank, before or
after any relevant judgment.

	5.	 	PAYMENTS

	5.1	 	Place of payment

Unless otherwise specified by the Issuing Bank or otherwise provided in this Agreement or
any of the other Finance Documents, all moneys to be paid by the Banks to the Issuing Bank
or by the Account Party or the Guarantor to any Bank under this Agreement and any of the
other Finance Documents shall be paid to the Issuing Bank or to the Agent or the Security
Trustee on behalf of the Banks (as the case may be):

	 	5.1.1	 	by not later than 10.00 a.m. (London time);

	 	5.1.2	 	on their due date in Pounds Sterling, in funds which are for same day
settlement in the London Interbank Payments System (or in such other funds as shall for
the time being be customary for settlement of international banking transactions in
Pounds Sterling); and

	 	5.1.3	 	to such account of the Issuing Bank, the Agent or the Security Trustee (as the
case may be) as such party shall notify the Account Party and the Banks in writing from
time to time.

	5.2	 	Availability of funds conditional upon receipt by Agent

Neither the Issuing Bank nor the Agent nor the Security Trustee shall be obliged to make
available to any of the parties hereto any amount which it is due to receive for the account
of that party and which it is not otherwise liable to pay unless it is satisfied that it has
unconditionally received the funds concerned.

	5.3	 	Refunds by Banks

Without prejudice to Clause 5.2, if the Issuing Bank or the Agent or the Security Trustee
makes an amount available to another Creditor Party which has not (but should have) been
paid to the Issuing Bank or the Agent or the Security Trustee by the Account Party or any
other Obligor, such Creditor Party shall:

	 	5.3.1	 	on demand refund such amount to the Issuing Bank or the Agent or the Security
Trustee (as the case may be); and

	 	5.3.2	 	pay to the Agent or the Issuing Bank on demand such further amount (as
conclusively certified by the Issuing Bank or the Agent or the Security Trustee) as
shall indemnify the Issuing Bank or the Agent or the Security Trustee against any cost,
loss, liability or expense suffered or incurred by the Issuing Bank or the Agent or the
Security Trustee as a result of its having made available such amount to that Creditor
Party before receiving it from the Account Party or other such Obligor.

	5.4	 	Non Banking Days

All payments due shall be made on a Banking Day. If the due date for payment falls on a day
which is not a Banking Day:

	 	5.4.1	 	the payment or payments due shall be made on the first Banking Day thereafter,
provided this falls in the same calendar month; and

	 	5.4.2	 	if it does not, payment shall fall due and be made on the immediately
preceding Banking Day.

	5.5	 	Accrual of interest and periodic payments

All payments of commission, interest and other payments of an annual or periodic nature to
be made by the Account Party shall accrue from day to day and be calculated on the basis of
the actual number of days elapsed and a 365 day year.

	6.	 	NO SET-OFF, COUNTERCLAIM OR TAX DEDUCTION

	6.1	 	No set-off or counterclaim

All payments to be made by the Account Party or any other Obligor under this Agreement and
any of the other Finance Documents shall be made:

	 	6.1.1	 	without set-off or counterclaim; and

	 	6.1.2	 	free and clear of, and without deduction for or on account of, any present or
future taxes, unless the Account Party or such other Obligor is compelled by law to
make payment subject to any such tax.

	6.2	 	Tax gross-up

	 	6.2.1	 	Each Obligor must make all payments to be made by it under the Finance
Documents without any Tax Deduction, unless a Tax Deduction is required by law.

	 	6.2.2	 	If an Obligor or the Issuing Bank is aware that an Obligor must make a Tax
Deduction (or that there is a change in the rate or the basis of a Tax Deduction), it
must promptly notify the Agent.

	 	6.2.3	 	If a Tax Deduction is required by law to be made by an Obligor or the Agent,
the amount of the payment due from the Obligor will be increased to an amount which
(after making the Tax Deduction) leaves an amount equal to the payment which would have
been due if no Tax Deduction had been required.

	 	6.2.4	 	If an Obligor is required to make a Tax Deduction or a payment required in
connection with a Tax Deduction, the Obligor making that Tax Deduction or payment must
deliver to the Agent for the relevant Creditor Party evidence satisfactory to that
Creditor Party (acting reasonably) that the Tax Deduction has been made or (as
applicable) the appropriate payment has been paid to the relevant taxing authority.

	6.3	 	Tax indemnity

	 	6.3.1	 	Except as provided below, the Account Party must indemnify a Creditor Party
against any loss or liability which that Creditor Party determines will be or has been
suffered (directly or indirectly) by that Creditor Party for or on account of Tax in
relation to a payment received or receivable (or any payment deemed to be received or
receivable) under a Finance Document.

	 	6.3.2	 	Clause 6.3.1 above does not apply to any Tax assessed on a Creditor Party
under the laws of the jurisdiction in which:

	 	(a)	 	that Creditor Party is incorporated or, if different, the
jurisdiction (or jurisdictions) in which that Creditor Party has a facility
office and is treated as resident for tax purposes; or

	 	(b)	 	that Creditor Party’s facility office is located in respect of
amounts received or receivable in that jurisdiction,

if that Tax is imposed on or calculated by reference to the net income received or
receivable by that Creditor Party. However, any payment deemed to be received or
receivable, including any amount treated as income but not actually received by the
Creditor Party, such as a Tax Deduction, will not be treated as net income received
or receivable for this purpose.

	6.4	 	Tax Credit

If an Obligor makes a Tax Payment and the relevant Creditor Party (in its absolute
discretion) determines that:

	 	6.4.1	 	it is entitled to receive or be granted a credit against Tax payable by it (a
“Tax Credit”) attributable to that Tax Payment; and

	 	6.4.2	 	it has used and retained that Tax Credit,

the Creditor Party must pay an amount to the Obligor which that Creditor Party determines
(in its absolute discretion) will leave it (after that payment) in the same after-tax
position as it would have been if the Tax Payment had not been made by the Obligor.

	7.	 	ACCOUNTS OF THE BANK

	7.1	 	Issuing Bank to open accounts

The Issuing Bank will open and maintain on its books accounts showing the amounts owing to
each Bank from the Account Party and the other Obligors and the amounts of all payments
falling due and received by that Bank.

	7.2	 	Evidence of obligations

In any legal action or proceeding arising out of or in connection with this Agreement, the
entries from time to time made in the accounts opened and maintained under this Clause 7
shall, in the absence of manifest error, be prima facie evidence of the obligation of the
Account Party to repay the Outstanding Indebtedness, to pay interest thereon and to pay all
other sums due hereunder.

	8.	 	APPLICATION OF MONEYS

	8.1	 	Order of application

	 	8.1.1	 	Except as otherwise specifically provided in this Agreement or in any other of
the Finance Documents, all moneys received or recovered by any Bank will, after
discharging the cost (if any) incurred in collecting such moneys, be applied as
follows:

	 	 	 	FIRST: in or towards payment of all moneys expended or liabilities incurred by the
Creditor Parties (or any of them) in respect of expenses, fees or charges
relating to the preparation, completion and registration (if any) of the Finance
Documents or in respect of the protection, maintenance or enforcement of any
security which they create;

	 	 	 	SECONDLY: in or towards the satisfaction of any amounts forming the balance of the
Outstanding Indebtedness which are then due and payable and are secured by an
applicable Finance Document, whether by reason of payment demanded or otherwise;

	 	 	 	THIRDLY: in or towards the satisfaction of any amounts forming the balance of the
Outstanding Indebtedness which are then due and payable, whether by reason of
payment demanded or otherwise;

	 	 	 	FOURTHLY: at the Banks’ discretion, in retention on an interest bearing suspense
account of such amount as the Agent may consider appropriate to secure the
discharge of any part of the Outstanding Indebtedness not then due and payable,
and, upon the same becoming due and payable, in or towards the discharge thereof
in accordance with the foregoing provisions of this Clause 8.1; and

	 	 	 	FIFTHLY: the balance (if any) shall be paid to the Account Party or other person
entitled.

	8.2	 	Waiver of right of appropriation

The Account Party hereby irrevocably waives any rights of appropriation to which it may be
entitled.

	9.	 	DEPOSIT ACCOUNTS

	9.1	 	Opening of Deposit Accounts

The Account Party and the Guarantor have each established with the Agent their respective
Existing Deposit Account and shall procure that Alterra Corporate 2 and Alterra Corporate 3
each open a New Deposit Account with the Agent as and when required in accordance with the
relevant Quota Share Assignment(s). The Account Party and any other Obligor may from time to
time (with the consent of the Agent) open one or more other accounts with the Agent which
shall constitute a “Deposit Account” for the purposes of this Agreement.

	9.2	 	Obligations with respect to Deposit Accounts

The Account Party will, at the request of the Agent, do and/or procure all such acts and
things and execute or procure the execution of all such documents as the Agent may require
in order to create security over the Deposit Accounts more effectively to secure the payment
of the Outstanding Indebtedness.

	9.3	 	Security over Deposit Accounts

Notwithstanding anything to the contrary contained in this Agreement, so long as the Account
Party remains under any liability (whether actual or contingent) in respect of the
Outstanding Indebtedness, each Deposit Account shall be subject to a continuing security in
favour of the Security Trustee pursuant to a Deposit Account Security Deed or, as the case
may be, a QSA Account Security Deed assigned to the Security Trustee under a QSA Account
Security Deed Assignment.

	9.4	 	Appropriation after default

On or at any time after the happening of an Event of Default or a Potential Event of Default
which is continuing the Agent shall forthwith become entitled at any time and without notice
to the Account Party or any other Obligor to appropriate to the extent of the Outstanding
Indebtedness all or any of the moneys standing to the credit of each Deposit Account which
is subject to a Deposit Account Security Deed and apply the same in or towards the discharge
of the Outstanding Indebtedness in accordance with Clause 8.

	9.5	 	Bank and other charges

All bank, exchange, telegraph and other charges in connection with the inward and outward
remittance of moneys to and from each Deposit Account shall be for the account of the
Account Party and the Agent shall be entitled, and is hereby irrevocably and unconditionally
authorised by the Account Holder and the Guarantor in respect of their Deposit Accounts, to
debit the amount of such charges to the Deposit Accounts, as and when such charges are
incurred.

	9.6	 	Continuing obligations of Account Party

Nothing in this Clause 9 whether express or implied, shall relieve the Account Party of its
absolute and unconditional obligations as the case may be to reimburse and indemnify the
Issuing Bank (on behalf of the Banks) in accordance with Clauses 4.3 and 4.4 and to pay
interest on any relevant amounts and to pay all other sums from time to time due, owing or
payable hereunder and under any of the other Finance Documents.

	10.	 	CONDITIONS PRECEDENT

	10.1	 	Conditions to be satisfied

It shall be a condition of the effectiveness of each Application and the issuance or
amendment of any Letter of Credit that the following conditions precedent are satisfied:

	 	10.1.1	 	the Issuing Bank has received a duly completed Application in respect of that Letter
of Credit together with a certificate signed by a director or the secretary of the
Applicant setting out a specimen signature of the person by whom that Application is
signed;

	 	10.1.2	 	the Agent has received payment of the fees and expenses specified in Clause 16 to the
extent due and payable;

	 	10.1.3	 	the Agent (or its legal advisers) has received the documents and evidence described
in Schedule 2, in form and substance satisfactory to them;

	 	10.1.4	 	in respect of any Letter of Credit to be used as FAL for a Corporate Member for the
2012 underwriting year of account, the Agent (or its legal advisers) has received on or
before 29 September 2011 the relevant documents and/or evidence specified in Clause
13.11 relating to such Corporate Member;

	 	10.1.5	 	the Agent is satisfied that:

	 	(a)	 	the representations and warranties contained in Clause 12 are
true and correct at the Issuance Date of that Letter of Credit;

	 	(b)	 	none of the circumstances specified in Clause 19 is subsisting;
and

	 	(c)	 	no Event of Default or Potential Event of Default has occurred or
will arise as a result of the issuance or amendment (as the case may be) of that
Letter of Credit.

	10.2	 	Waiver of conditions precedent

If the Issuing Bank (on behalf of and, with the approval of, all the Banks) in its absolute
discretion issues or amends any Letter of Credit notwithstanding that one or more of the
relevant conditions precedent specified above remains unsatisfied on the Issuance Date of
that Letter of Credit, then the Account Party shall procure the satisfaction of such
condition or conditions precedent within 14 days thereafter or such longer period as the
Agent may, in its absolute discretion, agree in writing.

	11.	 	SECURITY

	11.1	 	Security already provided

As security for the payment of the Outstanding Indebtedness, the Account Party has executed
and delivered or, as the case may be, has procured the execution and delivery in favour of
the Security Trustee of the following Finance Documents:

	 	11.1.1	 	the Fee Letter;

	 	11.1.2	 	the Existing Security Assignment and the Collateral Account Control Agreement
relating to the Existing Collateral Account;

	 	 	 	 	 
	 	11.2	 	 	11.1.3the Existing Deposit Account Security Deeds; and

11.1.4the Existing Quota Share Assignments.

Mandatory new security to be provided

As security for the payment of the Outstanding Indebtedness, the Account Party will execute
and deliver or, as the case may be, will procure the execution and delivery in favour of the
Security Trustee of the following Finance Documents:

	 	11.2.1	 	a New Quota Share Assignment in respect of each New Quota Share Agreement if and when
it is required to do so in accordance with Clause 13.11;

	 	11.2.2	 	the Alterra Corporate 2 Account Security Deed to be executed by Alterra Corporate 2
if and when it is required to do so in accordance with the relevant Quota Share
Assignment(s); and

	 	11.2.3	 	the Alterra Corporate 3 Account Security Deed to be executed by Alterra Corporate 3
if and when it is required to do so in accordance with the relevant Quota Share
Assignment(s).

	11.3	 	Optional new security to be provided

As security for the payment of the Outstanding Indebtedness, and as a condition to the
assets which are subject to that Finance Document being treated as “Investment Collateral”
for the purposes of this Agreement, the Account Party may execute and deliver or, as the
case may be, may procure the execution and delivery in favour of the Security Trustee of the
following Finance Documents:

	 	11.3.1	 	in respect of the Alterra Corporate 2 QS Account and the Investment Collateral held
on it, the Alterra Corporate 2 Pledge Assignment (which the Security Trustee will duly
execute), together with the Alterra Corporate 2 Pledge Agreement and the Alterra
Corporate 2 Control Agreement;

	 	11.3.2	 	in respect of the Alterra Corporate 3 QS Account and the Investment Collateral held
on it, the Alterra Corporate 3 Pledge Assignment (which the Security Trustee will duly
execute), together with the Alterra Corporate 3 Pledge Agreement and the Alterra
Corporate 3 Control Agreement;

	 	11.3.3	 	in respect of any New Collateral Account and the Investment Collateral held on it,
either a New Collateral Account Security Assignment or (as the case may be) a QSA
Account Security Deed Assignment where that New Collateral Account has been charged or
pledged to a Corporate Member pursuant to a QSA Account Security Deed (which in either
case the Security Trustee will duly execute) together in each case with a Collateral
Account Control Agreement;

	 	11.3.4	 	in respect of any New Deposit Account and the Investment Collateral held on it,
either a New Deposit Account Security Deed or (as the case may be) a QSA Account
Security Deed Assignment where that New Deposit Account has been charged or pledged to
a Corporate Member pursuant to a QSA Account Security Deed.

	12.	 	REPRESENTATIONS AND WARRANTIES

	12.1	 	Date of representations and warranties

Alterra Holdings represents and warrants that the following matters are true at 13 October
2008 and Alterra UK represents and warrants that the following matters are true at 5
December 2008.

	12.2	 	Existence, powers and compliance

The Account Party and Applicant:

	 	12.2.1	 	is a company duly incorporated with limited liability, validly existing and in good
standing under the laws of its country of incorporation;

	 	12.2.2	 	has full power to own its property and assets and to carry on its business as it is
now being conducted;

	 	12.2.3	 	subject to the operation and effect of the terms of any deeds of trust pursuant to
which its own assets are or may be deposited as FAL, has good and marketable title to
its property and assets; and

	 	12.2.4	 	has complied in all material respects with all statutory and other requirements
relative to its business.

	12.3	 	Capacity and authorisation

The entry into and performance by each of the Account Party and the other Obligors of this
Agreement and the other Finance Documents are, so far as it is aware and having made due
enquiry, within the corporate powers of the Account Party and those other Obligors and have
been duly authorised by all necessary corporate actions and approvals.

	12.4	 	No contravention of laws or contractual restrictions

The entry into and performance by each of the Account Party and the other Obligors of this
Agreement and the other Finance Documents does not and will not:

	 	12.4.1	 	contravene in any material respect any law, regulation or contractual restriction
which does, or may, bind the Account Party or those other Obligors or any of their
respective assets; or

	 	12.4.2	 	result in the creation or imposition of any Encumbrance (other than a Permitted
Encumbrance) on any of their respective assets in favour of any party other than the
Security Trustee.

	12.5	 	No third party Encumbrances

At the time of execution of this Agreement and each of the other Finance Documents, no third
party will have any Encumbrance (other than a Permitted Encumbrance) on any asset of the
Account Party to which this Agreement or the relevant Finance Document relates.

	12.6	 	Licences and approvals in force

All authorisations, approvals and consents necessary for the Account Party and Applicant to
enter into or perform its obligations under this Agreement and the other Finance Documents
have been obtained and are in full force and effect (except for such authorisations,
approvals and consents the failure to have or obtain would not reasonably be expected to
have a material adverse effect on the ability of the Account Party and Applicant to perform
its obligations thereunder).

	12.7	 	Validity and enforceability

When duly executed and delivered, and where applicable registered, each of this Agreement
and the other Finance Documents will:

	 	12.7.1	 	constitute the legal, valid and binding obligations of the parties thereto (other
than the Creditor Parties); and

	 	12.7.2	 	will create a perfected Security Interest with the required priority in the assets
and revenues intended to be covered thereby, enforceable against the parties thereto
(other than the Creditor Parties) in accordance with their respective terms,

except insofar as enforcement may be limited by any applicable laws relating to bankruptcy,
insolvency, administration and similar laws affecting creditors’ rights generally.

	12.8	 	No breach or default

The Account Party and Applicant is not:

	 	12.8.1	 	in material breach of any law, governmental directive, guideline or policy statement,
whether having the force of law or not; or

	 	12.8.2	 	in material default under any agreement to which it is party or by which it may be
bound.

	12.9	 	No litigation current or pending

No litigation, arbitration, tax claim or administrative proceeding is (to the knowledge of
the Account Party) current, pending or threatened, which, if adversely determined, would
have a materially detrimental effect on (a) the ability of the Account Party to perform its
obligations under this Agreement or (b) the financial condition, business assets or
prospects of the Account Party.

	12.10	 	Financial statements

Its most recent audited financial statements (consolidated, if appropriate) give a true and
fair view of its financial condition and operations during the financial year save to the
extent (if any) disclosed therein.

	 	 	 	 	 
	12.11	 	No default
	 	12.12	 	 	No Event of Default or Potential Event of Default has occurred and is continuing.

Choice of law and jurisdiction

The choice of English law to govern this Agreement and the other Finance Documents and the
submission by the Account Party to the jurisdiction of the English courts is valid and
binding on it, and the Account Party is not entitled to claim any immunity in relation to
itself or its assets under any law or in any jurisdiction in connection with any legal
proceedings, set-off or counterclaim relating to this Agreement or the other Finance
Documents or in connection with the enforcement of any judgment or order arising from such
proceedings.

	12.13	 	Truth of financial and other information

The financial and other information supplied to the Agent by or on behalf of the Account
Party or any other Obligor in connection with the negotiation and the preparation of this
Agreement was true and accurate in all material respects as of the date it was supplied and
is not misleading in any respect.

	12.14	 	No material adverse change in financial condition

There has been no material adverse change in the financial condition of any Obligor since
30 June 2008.

	12.15	 	No liability to deduction or withholding

Payments to be made by the Account Party under this Agreement and the other Finance
Documents may be made free and clear of and without deduction or withholding for or on
account of any taxes.

	12.16	 	No filings or stamp taxes

Under the laws of its jurisdiction of incorporation in force at 13 October 2008, it is not
necessary that the Finance Documents be filed, recorded or enrolled with any court or other
authority in such jurisdiction or that any stamp, documentary or similar tax be paid on or
in relation thereto.

	12.17	 	Pari passu obligations

The Account Party’s obligations under this Agreement and the other Finance Documents will
rank at least pari passu with all of its other unsecured and unsubordinated obligations and
liabilities from time to time outstanding other than as preferred by any bankruptcy,
insolvency, administration or similar laws affecting creditors’ rights generally.

	12.18	 	No commissions or rebates

There are no commissions, rebates, premiums or other payments by or to or for the account of
any Obligor, its shareholders or directors in connection with the transactions contemplated
by this Agreement, other than as disclosed to the Agent in writing.

	12.19	 	Insolvency

	 	12.19.1	 	No Obligor has admitted its inability to pay its debts or suspended making payments
on any of its debts.

	 	12.19.2	 	No Obligor, by reason of actual or anticipated financial difficulties, has
commenced, or intends to commence, negotiations with one or more of its creditors with
a view to rescheduling any of its Financial Indebtedness.

	 	12.19.3	 	The aggregate value of the assets of the Group is not less than its aggregate
liabilities (taking into account contingent and prospective liabilities).

	12.20	 	Money laundering

The performance of the obligations of the Account Party under this Agreement and under the
other Finance Documents to which it is a party will be for its own account and will not
involve any breach by it of any law or regulatory measure relating to money laundering as
defined in Article 1 of the Directive 2005/60/EC of the European Parliament and of the
Council of the European Communities or any equivalent law or regulatory measure in any other
jurisdiction.

	12.21	 	Continuing nature of representations and warranties

	 	12.21.1	 	Alterra Holdings agrees that the representations given by it set out in this Clause
12 shall be deemed to be repeated on the first Application Day and on the first
Issuance Date and on the Restatement Date with reference to the facts and circumstances
then subsisting, as if made on such date.

	 	12.21.2	 	Alterra UK agrees that the representations given by it set out in this Clause 12
shall be deemed to be repeated on each Application Day (other than the first such day)
and on each Issuance Date (other than the first such date) and on the Restatement Date
with reference to the facts and circumstances then subsisting, as if made on such date.

	13.	 	UNDERTAKINGS

	13.1	 	Duration of undertakings

The Account Party shall comply with the undertakings contained in this Clause 13 which shall
remain in force from the date of this Agreement to the end of the Security Period.

	13.2	 	General undertakings

The Account Party shall:

	 	13.2.1	 	perform and observe the several covenants and obligations imposed upon it under the
Finance Documents;

	 	13.2.2	 	inform the Agent promptly upon becoming aware of any litigation, arbitration, tax
claim or administrative proceeding instituted or threatened and of any other occurrence
of which it becomes aware which may materially adversely affect:

	 	(a)	 	its ability, or the ability of any other Obligor, to perform its
obligations under the Finance Documents;

	 	(b)	 	the financial condition, business, assets or prospects of the
Account Party; or

	 	(c)	 	the security constituted by the Finance Documents;

	 	13.2.3	 	maintain its corporate existence as a corporation duly organised, validly existing
and (if incorporated in a jurisdiction other than England and Wales) in good standing
in its place of incorporation;

	 	13.2.4	 	obtain and maintain in force, and promptly furnish certified copies to the Agent of,
all licences, authorisations, approvals and consents, and do all other acts and things,
which may from time to time be necessary for the continued due performance of its
obligations under the Finance Documents or which may be required for the validity,
enforceability or admissibility in evidence of the Finance Documents;

	 	13.2.5	 	ensure that its obligations under the Finance Documents rank at least pari passu with
all its other present, future and/or contingent unsecured and unsubordinated
obligations from time to time outstanding save those which are preferred solely by any
bankruptcy, insolvency, liquidation or other similar laws;

	 	13.2.6	 	promptly after the happening of any Event of Default or Potential Event of Default,
notify the Agent of such event and of the steps (if any) which are being taken to
remedy it;

	 	13.2.7	 	pay all taxes, assessments and other governmental charges as they fall due, except to
the extent that it is contesting the same in good faith by appropriate proceedings;

	 	13.2.8	 	keep proper books of account in respect of its business in accordance with generally
accepted accounting principles consistently applied and on reasonable notice whenever
so requested by the Agent (acting reasonably) make the same available for inspection on
a working day during business hours by or on behalf of the Agent in confidence (on the
basis specified in Clause 13.2.9 as if the books of account concerned were information
provided to the Agent);

	 	13.2.9	 	provide the Agent in confidence (on the basis that the Agent may disclose the
information to the Banks provided that at the time of such disclosure the Agent informs
the Banks that the information was provided on a confidential basis and the Banks treat
and hold such information for all purposes as confidential) with such financial and
other information concerning itself and its affairs as the Agent or the Banks may from
time to time reasonably require (in addition to the matters referred to in Clause 14)
together with copies of any other financial reports that any of the Obligors are
required to prepare by Lloyd’s under Lloyd’s Rules or by any regulator or governmental
entity;

	 	13.2.10	 	(if the Agent in its reasonable opinion considers that the Account Party’s financial
position or prospects are deteriorating and the Agent so requests), give independent
auditors appointed to carry out a review of its affairs at the cost (if no Event of
Default is continuing) of the Agent and provide all reasonable assistance in that
regard;

	 	13.2.11	 	not more than twice each year, within 30 days after each Coming Into Line Date, and
at such other times as the Agent may request, provide the Agent with a certificate
signed by its chief financial officer or chief executive officer confirming (a) that it
is, as at the date of such certificate, in compliance with its obligations under the
Finance Documents and that, so far as it is aware, no Event of Default has occurred,
or, if any has occurred, none is continuing and (b) that the Managing Agent has adhered
in all material respects to Lloyd’s requirements with regard to the investment of
syndicate funds; and

	 	13.2.12	 	promptly provide, at the request of the Agent, any information reasonably requested
by the Agent or any of the Banks pursuant to any anti-money laundering legislation,
regulation, procedures applicable to it from time to time so as to ensure compliance by
any Bank, its employees, officers and directors with any such anti-money laundering
legislation, regulation or procedures; and

	 	13.2.13	 	procure that the Corporate Members which are party to any of the Quota Share
Agreements do not:

	 	(a)	 	amend or waive any term of the Quota Share Agreements or any QSA
Account Security Deed relating thereto other than an amendment or waiver
relating to an administrative matter or otherwise without the prior written
consent of the Agent (acting at the direction of the Majority Banks), such
consent not to be unreasonably withheld;

	 	(b)	 	terminate the Quota Share Agreements or any QSA Account Security
Deed relating thereto other than with the prior written consent of the Agent
(acting at the direction of the Majority Banks);

	 	(c)	 	take any action which might jeopardise the existence or
enforceability of the Quota Share Agreements or any QSA Account Security Deed
relating thereto; or

	 	(d)	 	do anything (by act or omission) to challenge or which would
prejudice any rights or interest of the Security Trustee in the security created
by (i) the relevant Quota Share Assignments over the Quota Share Agreements,
(ii) the relevant QSA Account Security Deed over any Deposit Account or
Collateral Account or (iii) the relevant QSA Account Security Deed Assignment
over any QSA Account Security Deed.

	13.3	 	Disposals

	 	13.3.1	 	Except as provided below, no member of the Alterra UK Group may without the prior
consent of the Agent (not to be unreasonably withheld), either in a single transaction
or in a series of transactions and whether related or not, dispose of all or any part
of its assets.

	 	13.3.2	 	Clause 13.3.1 does not apply to any disposal:

	 	(a)	 	of receivables by way of sale or assignment;

	 	(b)	 	approved by the Majority Banks; or

	 	(c)	 	where the higher of the market value and consideration receivable
(when aggregated with the higher of the market value and consideration for any
other disposal not allowed under the preceding subparagraphs) does not exceed,
in aggregate, £3,000,000 or its equivalent in any financial year of the Alterra
UK Group.

	13.4	 	Financial Indebtedness

	 	13.4.1	 	Except as provided below, no member of the Alterra UK Group may incur any Financial
Indebtedness without the prior written consent of the Agent (acting with the consent of
all the Banks).

	 	13.4.2	 	Clause 13.4.1 does not apply to:

	 	(a)	 	any Financial Indebtedness incurred under the Finance Documents;

	 	(b)	 	Financial Indebtedness outstanding on the date of this Agreement
and advised to the Agent and renewals, refinancing and extensions thereof;
provided that after giving effect to any such renewal, refinancing or extension
there shall be no increase in the principal amount of such refinanced, renewed
or extended Financial Indebtedness except as provided in the agreement under
which it arises as in force at the date of this Agreement;

	 	(c)	 	Financial Indebtedness incurred or assumed for the purpose of
financing all or any part of the cost of acquiring any fixed asset (including
through capital leases), in an aggregate principal amount at any time
outstanding not greater than £2,000,000;

	 	(d)	 	unsecured inter-company Financial Indebtedness arising from loans
made by (i) one Obligor to the other, and (ii) any Subsidiary to any Obligor
that shall be subordinated in right of payment to the payment obligations under
this Agreement on terms and conditions satisfactory to the Agent;

	 	(e)	 	Financial Indebtedness in connection with Hedging Obligations;

	 	(f)	 	Financial Indebtedness in connection with accounts or claims
payable incurred in the ordinary course of business and not exceeding £9,000,000
in the aggregate; or

	 	(g)	 	Financial Indebtedness not otherwise permitted in this Clause
13.4 not to exceed £10,000,000.

	13.5	 	Maintenance of Finance Documents

Promptly upon the request of the Agent, the Account Party shall execute, acknowledge,
deliver and record and do or procure any and all such further acts and deeds as the Agent
may reasonably request from time to time in order to ensure that the obligations of the
Account Party under this Agreement are secured by valid assignments of the Quota Share
Agreements pursuant to the Quota Share Assignments.

	13.6	 	Consent of Banks required

The Account Party shall not except with the prior written consent of the Agent (acting with
the consent of all the Banks):

	 	13.6.1	 	except in the ordinary course of business or in a disposal referred to in Clause
13.3.2, convey, assign, transfer, sell or otherwise dispose of or deal with any of its
real or personal property, assets or rights, whether present or future;

	 	13.6.2	 	create or permit to exist any Encumbrance over any Deposit Account, any Collateral
Account, any Quota Share Agreement or any QSA Account Security Deed except pursuant to
the Finance Documents or, create or permit to exist any Encumbrance (other than a
Permitted Encumbrance) over any other part of its undertaking, property, assets or
rights, whether present or future (provided that where any such Encumbrance arises in
the ordinary course of business, the Account Party shall promptly discharge the same);

	 	13.6.3	 	except in the ordinary course of business, acquire or agree to acquire any asset or
other property;

	 	13.6.4	 	consolidate, amalgamate or merge with any other entity;

	 	13.6.5	 	cease carrying on the business it carries on at the date of this Agreement; or

	 	13.6.6	 	alter any of the provisions of its articles of incorporation or byelaws or other
constitutional documents which, in each case, would have a material adverse effect on
the ability of the Account Party to perform any of its obligations under this Agreement
or the Finance Documents.

	13.7	 	Managing Agent

The Account Party shall procure that the Managing Agent:

	 	13.7.1	 	adheres in all material respects to Lloyd’s requirements with regard to the
investment of syndicate funds; and

	 	13.7.2	 	executes and delivers to the Agent in respect of each Letter of Credit a deed of
undertaking substantially in the form set out in Schedule 10 or such other form as the
Agent may agree.

	13.8	 	Additional collateral

Following the occurrence of an Event of Default which is continuing, the Account Party
shall, at the request of the Agent, immediately provide (or procure the provision of) such
additional Investment Collateral, as the Agent shall request, with the intent that the
contingent obligations of the Creditor Parties under or in respect of any Letter of Credit
shall be fully collateralised and secured to the satisfaction of the Agent.

	13.9	 	Collateral cover

If:

	 	13.9.1	 	the financial strength rating of Alterra Bermuda from AM Best is less than B++, the
Account Party must provide collateral cover (or ensure that collateral cover is
provided) in the form of Investment Collateral and in an amount equal to the face value
of each issued Letter of Credit, such collateral cover to be provided within 2 Banking
Days of the date on which the relevant financial strength rating becomes less than B++;
or

	 	13.9.2	 	any Obligor or any Relevant Corporate Member reports on its solvency statements
prepared by Lloyd’s a solvency deficit in its individual open year of account and the
applicable amount is not funded directly at Lloyd’s by depositing cash or similar
assets into the Relevant Corporate Member’s personal reserves by 30 June and 31
December of the corresponding calendar year, the Account Party must provide collateral
cover (or ensure that collateral cover is provided) in the form of Investment
Collateral in an amount equal to the relevant solvency deficit or residual solvency
deficit if part funded, such collateral cover to be provided within 2 Banking Days of
30 June and 31 December of the corresponding calendar year;

	 	13.9.3	 	notice of termination of a Letter of Credit is served in accordance with the
provisions of Clause 3.11 all amounts payable under such Letter of Credit shall be
fully collateralised in the form of Investment Collateral within 5 Banking Days
following the 31 December of the applicable last year of account except where the
relevant Corporate Member does not provide any underwriting capacity to any Syndicate
for the following underwriting year of account, in which case, such collateralisation
will only be required from the date falling 18 months after 31 December of the last
year of account agreed to have been supported by the applicable Letter of Credit;

	 	13.9.4	 	the net loss to the Syndicate on any RDS would, without the prior written consent of
the Majority Banks (not to be unreasonably withheld of delayed), exceed 20% of the
Syndicate’s overall premium limit for the year of account concerned then all amounts
payable under each Letter of Credit shall be fully collateralised in the form of
Investment Collateral within 3 Banking Days of the date on which the relevant net loss
would exceed the specified percentage or, if at any time Lloyd’s redefines any existing
RDS or prescribes any new RDS which in each case is applicable in respect of the
Syndicate, within 30 Banking Days of the date on which the relevant loss would exceed
the specified percentage;

	 	13.9.5	 	other than as permitted in the Quota Share Assignment in respect of that Quota Share
Agreement, an Obligor makes or permits to be made any amendment to any of the Quota
Share Agreements that shortens the term of the reinsurance thereunder or reduces the
reinsurance recoveries thereunder or changes the governing law or jurisdiction thereof
or makes or permits to be made any amendment to any Lloyd’s Security and Trust Deed
that reduces the sums payable thereunder (other than as required by Lloyd’s) in either
case without the prior written consent of the Agent (acting at the direction of the
Majority Banks), such consent not to be unreasonably withheld and to be deemed to be
granted if not expressly withheld within 20 Banking Days of the request therefor, the
Account Party must provide collateral cover in the form of Investment Collateral in an
amount equal to the face value of each issued Letter of Credit, such collateral cover
to be provided within 15 Banking Days of the date of such amendment;

	 	13.9.6	 	(a) it is or becomes unlawful for a Corporate Member or a Reinsurer to perform any of
its material obligations under any Quota Share Agreement to which it is party;

	 	(b)	 	any Quota Share Agreement is not effective in accordance with its
terms or is alleged by a Corporate Member or a Reinsurer to be ineffective in
accordance with its terms for any reason;

	 	(c)	 	a Corporate Member or a Reinsurer repudiates or terminates any
Quota Share Agreement to which it is party or evidences an intention to
repudiate or terminate any such Quota Share Agreement other than as permitted in
the Quota Share Assignment in respect of that Quota Share Agreement and save
also where a Quota Share Agreement is terminated in respect of future years of
account which are covered by a New Quota Share Agreement or in respect of future
years of account which are not covered by any Letter of Credit;

	 	(d)	 	a Corporate Member or a Reinsurer fails to pay any amount due and
payable by it under any Quota Share Agreement to which it is party within any
cure period allowed thereunder or breaches any material term of any such Quota
Share Agreement;

	 	(e)	 	a Corporate Member or a Reinsurer ceases, or threatens to cease,
to carry on business;

the Account Party must provide collateral cover (or ensure that collateral cover is
provided) in the form of Investment Collateral in an amount equal to the face value of each
issued Letter of Credit, such collateral cover to be provided within 15 Banking Days of the
relevant event.

	13.10	 	Option regarding collateralisation

Whenever the Account Party is required to provide additional collateral pursuant to this
Clause 13 it shall have the option of providing some or all of the amount that would
otherwise be required by providing or procuring the provision of FAL to Lloyd’s in that
amount in reduction or replacement of Letters of Credit then in issue.

	13.11	 	Quota Share Agreements for 2012 underwriting year of account

No Letter of Credit shall be issued or extended to provide FAL to a Corporate Member in
respect of any Syndicate for the 2012 underwriting year of account unless, on or before 29
September 2011, the Agent receives either:

	 	13.11.1	 	confirmation in writing from the relevant Corporate Member and Reinsurer in a form
acceptable to the Agent that neither party has exercised or will within the remaining
permitted notice period exercise its right to terminate the relevant Quota Share
Agreement in respect of the 2012 underwriting year of account for that Syndicate; or

	 	13.11.2	 	a certified copy of a New Quota Share Agreement entered into by the relevant
Corporate Member and Alterra Bermuda in respect of the 2012 underwriting year of
account for that Syndicate in a form acceptable to the Agent including (without
limitation) a requirement for full collateralisation of the obligations of Alterra
Bermuda under such New Quota Share Agreement in the event of (a) a change in the
financial strength rating of Alterra Bermuda by AM Best to a level below B++ and/or (b)
a change in the ownership of Alterra Bermuda together with:

	 	(a)	 	an original New Quota Share Assignment in respect of that New
Quota Share Agreement duly executed by the relevant Corporate Member in favour
of the Security Trustee; and

	 	(b)	 	all such documents as are required to be provided in respect
thereof under Clause 13.12.

	13.12	 	Evidence of due execution and enforceability of Finance Documents executed on or after the
Restatement Date

The Account Party and the Guarantor undertake to provide to the Agent in respect of each
Finance Document executed on or after the Restatement Date:

	 	13.12.1	 	in respect of each party (other than a Creditor Party) executing that Finance
Document:

	 	(a)	 	certified copies of its memorandum and articles of incorporation
or equivalent constitutional documents;

	 	(b)	 	a certificate of good standing (unless its jurisdiction of
incorporation is England and Wales) or other evidence that it is in good
standing in its jurisdiction of incorporation;

	 	(c)	 	a certificate of incumbency signed by its secretary or a director
stating its officers and directors;

	 	(d)	 	certified copies of resolutions duly passed by its directors and,
if appropriate and requested by the Agent, its shareholders (other than the
Guarantor) at separate meetings evidencing approval of the transactions
contemplated by such Finance Document and authorising its execution;

	 	(e)	 	the original or a certified copy of any power of attorney issued
by it in favour of any person or persons executing such Finance Document;

	 	(f)	 	certified copies of all licences, authorisations, approvals and
consents required by it (if any) in connection with the execution, delivery,
performance, validity and enforceability of such Finance Document;

	 	13.12.2	 	any and all documents, instruments, notices and acknowledgements thereto required
under such Finance Document duly executed by the relevant parties (including in the
case of a QSA Account Security Deed Assignment, a certified copy of the relevant QSA
Account Security Deed);

	 	13.12.3	 	evidence that any agent for service of process in England under such Finance
Document has accepted its appointment as such; and

	 	13.12.4	 	favourable opinions from the Agent’s legal advisers in all relevant jurisdictions
with respect to such Finance Document, in such terms as the Agent may require.

	14.	 	FINANCIAL COVENANTS

	14.1	 	Definitions

In this Clause 14:

"Capital Stock” means any and all shares, interests, participations or other equivalents
(however designated) of capital stock of a corporation and any and all warrants, rights or
options to purchase any of the foregoing;

"Consolidated Net Income” means, for any period, for Alterra Bermuda and its Subsidiaries on
a consolidated basis, the net income of Alterra Bermuda and its Subsidiaries (excluding
extraordinary gains and any unrealised gains or losses but including extraordinary losses)
for that period calculated in accordance with US GAAP;

"Fiscal Quarter” means any quarter of a Fiscal Year;

"Fiscal Year” means any period of twelve consecutive calendar months ending on the last day
of December;

"Total Debt” means, on any date, the aggregate principal amount (including any interest,
fees or other amounts added thereto) of all Financial Indebtedness of the Group on that
date, determined on a consolidated basis in accordance with US GAAP, provided however, that
Total Debt shall (a) not include any obligations in respect of letters of credit which have
not been drawn or have been drawn but reimbursed by the person for whose account such letter
of credit was issued and (b) include only that portion of the Total Return Equity Swaps,
including notional value additions, which is treated as indebtedness by A.M. Best Company.
On the date of this Agreement, A.M. Best Company currently treats 0% of the existing Total
Return Equity Swap as indebtedness;

"Total Debt to Total Capitalization Ratio” means the ratio of (a) Total Debt to (b) the sum
of Total Debt plus US GAAP Net Worth of Alterra Holdings;

"Total Return Equity Swap” means (a) the total return equity swap entered into by Alterra
Bermuda in connection with the common shares of Alterra Diversified Strategies Limited, (b)
Financial Indebtedness of Alterra Bermuda secured by the common shares of Alterra
Diversified Strategies Ltd. which is incurred for the purpose of acquiring assets which
qualify to be held in trusts which secure Alterra Bermuda’s obligations under reinsurance
agreements and primary policies, and (c) any substantially similar financial arrangement or
transaction entered into by the Group; and

	 	 	 
	14.2

	 	"US GAAP Net Worth” means shareholders’ equity calculated in accordance with US GAAP.

US GAAP Net Worth of Alterra Bermuda

At all times during the Security Period, the US GAAP Net Worth of Alterra Bermuda shall not
be less than the sum of (a) $1,743,462,131 plus (b) an amount equal to 50% of the
Consolidated Net Income of Alterra Bermuda (with no deduction for any consolidated net loss)
in each Fiscal Quarter of the applicable Fiscal Year plus (c) an amount equal to 50% of the
aggregate increases in shareholders’ equity of Alterra Bermuda by reason of the issuance and
sale of Capital Stock of Alterra Bermuda or other capital contributions in each Fiscal
Quarter of the applicable Fiscal Year.

	14.3	 	Total Debt to Total Capitalization Ratio

Alterra Holdings shall ensure that, at all times during the Security Period, the Total Debt
to Total Capitalization Ratio does not exceed 35%.

	14.4	 	Maintenance and application of FAL

The Account Party shall at all times during the Security Period:

	 	14.4.1	 	ensure that there is maintained in respect of each Corporate Member at all times an
amount of Primary FAL of not less than 35% of the total FAL requirement of such
Corporate Member, which the Agent, acting reasonably, is satisfied will be attributed
by Lloyd’s for the purposes of determining such Corporate Member’s premium limits in
relation to the Syndicates for the following year of account, net of any liabilities
taken into account in calculating the net FAL of such Corporate Member;

	 	14.4.2	 	ensure that no part of the Primary FAL of any Corporate Member is the subject of any
arrangement whereby (i) it is also included (through interavailability or otherwise) in
the FAL of any other Corporate Member or (ii) it is or can be applied for any purpose
other than meeting losses of that Corporate Member; and

	 	14.4.3	 	use commercially reasonable endeavours:

	 	(a)	 	to ensure that the Primary FAL is applied to the fullest extent
possible before any payment is made under any Letter of Credit issued pursuant
to this Agreement; and

	 	(b)	 	from time to time on request by the Agent following any change
made to the composition of the FAL of any Corporate Member to obtain a comfort
letter from Lloyd’s with respect to the order of application of FAL of each
Corporate Member, such comfort letter to be substantially in the form of
Schedule 9 or such other form as the Agent may agree.

	14.5	 	Interpretation

	 	14.5.1	 	Except as provided to the contrary in this Agreement, an accounting term used in this
Clause is to be construed in accordance with the principles applied in connection with
the financial statements supplied to the Agent by the Account Party.

	 	14.5.2	 	Any amount in a currency other than Sterling is to be taken into account at its
Sterling equivalent calculated on the basis of:

	 	(a)	 	the Agent’s spot rate of exchange for the purchase of the
relevant currency in the London foreign exchange market with Sterling at or
about 11.00 a.m. on the day the relevant amount falls to be calculated; or

	 	(b)	 	if the amount is to be calculated on the last day of a financial
period of an Obligor, the relevant rates of exchange used by that Obligor in, or
in connection with, its financial statements for that period.

	 	14.5.3	 	No item must be credited or deducted more than once in any calculation under this
Clause.

	14.6	 	Financial and other information

The Account Party must provide the Agent (with sufficient copies for each Bank) with:

	 	14.6.1	 	within 90 days of the end of each financial year of the Account Party, Alterra
Holdings and Alterra Bermuda (starting with the financial year ended 31 December 2010),
certified copies of its consolidated profit and loss account and balance sheet prepared
in a form consistent with US GAAP consistently applied and audited by an
internationally recognised firm of independent auditors licensed to practise in the
jurisdiction of incorporation of the company concerned;

	 	14.6.2	 	the Franchise Performance Management Quarterly Monitoring Returns for the Syndicates,
as soon as they are available and in any event within 3 days of them being delivered to
Lloyds;

	 	14.6.3	 	on a quarterly basis, details of all letters of credit facilities entered into by the
Group and letters of credit issued under such facilities, provided that such obligation
may be satisfied by notification to the Agent of the documents filed with the US
Securities and Exchange Commission containing such details;

	 	14.6.4	 	within 45 days from the end of the first three calendar quarters of each year,
quarterly financial statements of the Account Party, Alterra Holdings and Alterra
Bermuda;

	 	14.6.5	 	the annual solvency statements prepared by Lloyd’s for the corporate members of the
Syndicates, within 3 days of them being received from Lloyd’s;

	 	14.6.6	 	(a) a summary of the RDS calculations for each relevant Syndicate, within 3 days of
them being received from Lloyd’s by the Account Party;

	 	(b)	 	a summary of any material changes in the definition of Realistic
Disaster Scenario prescribed by Lloyd’s, together with a summary, in form and
substance satisfactory to the Agent of the impact of those changes on the
covenant referred to in Clause 13.9.4, within 30 days of the relevant member of
the Group receiving notification from Lloyd’s of that change;

	 	14.6.7	 	in the event that Investment Collateral has been deposited by the Account Party or
any other relevant person with an Approved Custodian, a Borrowing Base Certificate from
the Account Party or that other relevant person (as the case may be) together with a
Custodial Account Certificate and Valuation Report from the relevant Approved Custodian
in respect of the last day of each calendar month (or such other shorter period as the
Agent may request), within 10 days of the end of the calendar month to which it refers
or at any other time that the Agent may request if an Event of Default or Potential
Event of Default has occurred and is continuing;

	 	14.6.8	 	such other financial reports as each Syndicate and/or the Account Party may be
required to provide to Lloyd’s or to any other regulator or government authority from
time to time.

	14.7	 	Compliance Certificate

	 	14.7.1	 	Within 45 days of the end of each quarter, the Account Party must supply to the Agent
a Compliance Certificate prepared as at the last day of such quarter (the “Reference
Date”).

	 	14.7.2	 	A Compliance Certificate must be signed by a director of the Account Party.

	15.	 	EVENTS OF DEFAULT

	 	 	 	 	 	 	 
	15.1	 	Defaults	 	 
	 	 	There shall be an Event of Default if any one or more of the following happen:
	
 
	 	 	15.1.1	 	 	Non-payment

The Account Party or, as the case may be, any other Obligor either (a) fails to make
any payment due under any of the Finance Documents on its due date unless such
failure to pay is caused by technical difficulties within the banking system in
relation to the transmission of funds and payment is made within 5 Banking Days of
such date, or, in respect of moneys payable on demand (unless otherwise specifically
provided), within 5 Banking Days from the date of such demand or (b) fails to comply
with the provisions of Clause 13.9 strictly in accordance with its terms.

	 	15.1.2	 	Non-compliance

The Account Party or any other Obligor does not comply with any other term of the
Finance Documents to which it is party not already referred to in this Clause, unless
the non compliance:

	 	(a)	 	is capable of remedy; and

	 	(b)	 	is remedied within 20 Banking Days of the Agent giving notice to
the Account Party or such other Obligor.

	 	15.1.3	 	Representations

A representation or warranty made by or repeated by an Obligor in any Finance
Document is incorrect or misleading in any material respect when made or deemed to be
repeated.

	 	15.1.4	 	Unlawfulness and repudiation

	 	(a)	 	It is or becomes unlawful for an Obligor to perform any of its
obligations under the Finance Documents.

	 	(b)	 	Any Finance Document is not effective in accordance with its
terms or is alleged by an Obligor to be ineffective in accordance with its terms
for any reason.

	 	(c)	 	An Obligor repudiates a Finance Document or evidences an
intention to repudiate a Finance Document.

	 	(d)	 	The Security Trustee shall fail to have, following execution of
each Quota Share Assignment, a valid assignment by way of security of each of
the Quota Share Agreements (other than following expiry or termination thereof
in accordance with their terms or with the Finance Documents)

	 	15.1.5	 	Cross-default

Any of the following occurs in respect of any Obligor:

	 	(a)	 	any of its Financial Indebtedness is not paid when due (after the
expiry of any applicable grace period);

	 	(b)	 	any of its Financial Indebtedness:

	 	(i)	 	becomes prematurely due and payable;

	 	(ii)	 	is placed on demand; or

	 	(iii)	 	is capable of being declared by or on behalf of
a creditor to be prematurely due and payable or of being placed on
demand,

in each case, as a result of an event of default or any provision having a
similar effect (howsoever described); or

	 	(c)	 	any commitment for its Financial Indebtedness is cancelled or
suspended as a result of an event of default or any provision having a similar
effect (however described),

unless the aggregate amount of Financial Indebtedness falling within all or any of
Clause 15.1.5(a) to 15.1.5(c) above is less than £10,000,000 (or its equivalent in
any other currency).

	 	15.1.6	 	Insolvency

Any of the following occurs in respect of any Obligor:

	 	(a)	 	it is, or is deemed for the purposes of any applicable law to be,
unable to pay its debts as they fall due or insolvent;

	 	(b)	 	it admits its inability to pay its debts as they fall due;

	 	(c)	 	it suspends making payments on any of its debts or announces an
intention to do so;

	 	(d)	 	by reason of actual or anticipated financial difficulties, it
begins negotiations with any creditor for the rescheduling or restructuring of
any of its indebtedness;

	 	(e)	 	the value of its assets is less than its liabilities (taking into
account contingent and prospective liabilities); or

	 	(f)	 	a moratorium is declared in respect of any of its indebtedness.

If a moratorium occurs in respect of any Obligor, the ending of the moratorium will
not remedy any Event of Default caused by the moratorium.

	 	15.1.7	 	Insolvency proceedings

	 	 	 	Except as provided below, any of the following occurs in respect of any Obligor:

	 	(a)	 	any step is taken with a view to a moratorium or a composition,
assignment or similar arrangement with any of its creditors;

	 	(b)	 	a meeting of its shareholders, directors or other officers is
convened for the purpose of considering any resolution for, to petition for or
to file documents with a court or any registrar for, its winding up,
administration or dissolution or any such resolution is passed;

	 	(c)	 	any person presents a petition, or files documents with a court
or any registrar, for its winding up, administration, dissolution or
reorganisation (by way of voluntary arrangement, scheme of arrangement or
otherwise);

	 	(d)	 	any Security Interest is enforced over any of its assets;

	 	(e)	 	an order for its winding up, administration or dissolution is
made;

	 	(f)	 	any liquidator, trustee in bankruptcy, judicial custodian,
compulsory manager, receiver, administrative receiver, administrator or similar
officer is appointed in respect of it and any of its assets;

	 	(g)	 	its shareholders, directors or other officers request the
appointment of, or give notice of their intention to appoint, a liquidator,
trustee in bankruptcy, judicial custodian, compulsory manager, receiver,
administrative receiver, administrator or similar officer; or

	 	(h)	 	any other analogous step or procedure is taken in any
jurisdiction.

	 	15.1.8	 	Creditors’ process

Any attachment, sequestration, distress, execution or analogous event affecting any
asset(s) of the Account Party or any other Obligor having an aggregate value of at
least £10,000,000 is not discharged or stayed within 30 days.

	 	15.1.9	 	Cessation of business

Any member of the Alterra UK Group ceases, or threatens to cease, to carry on
business except as a result of any disposal allowed under this Agreement.

	 	15.1.10	 	Illegality

It is or becomes illegal for the Account Party to make or maintain any of its
obligations under any Finance Document.

	 	15.1.11	 	Material adverse change

Any event or circumstance occurs which the Agent reasonably believes would have a
material adverse effect on the ability of the Account Party to perform its
obligations under this Agreement.

	 	15.1.12	 	Ownership

An Obligor (other than Alterra Holdings) or Alterra Bermuda ceases to be a Subsidiary
of Alterra Holdings.

	15.2	 	Banks’ remedies

Upon the occurrence of an Event of Default and at any time thereafter whilst it is
continuing, without prejudice to any of the rights and remedies of any Creditor Party under
any of the other Finance Documents or otherwise, the Agent may, and shall if so requested by
the Majority Banks, take any one or more of the following actions:

	 	15.2.1	 	by written notice to the Account Party declare the commitment of the Issuing Bank to
issue or amend any Letter of Credit cancelled, whereupon such commitment shall be
cancelled;

	 	15.2.2	 	enter into any agreement or arrangement which the Banks shall think fit for the
cancellation, discharge, release, reduction, compromise and/or return of any or all of
the Letters of Credit then outstanding and/or any actual or contingent obligation or
liability thereunder; and

	 	15.2.3	 	take steps to exercise the rights and remedies conferred upon the Creditor Parties by
Clause 13.8 and the other provisions of this Agreement and the other Finance Documents
and exercisable on or after the occurrence of an Event of Default.

	16.	 	FEES, EXPENSES AND INDEMNITIES

	16.1	 	L/C commissions

	 	16.1.1	 	In respect of all Letters of Credit issued pursuant to this Agreement, the Account
Party shall pay to the Agent (for the benefit of the Banks) a commission payable
quarterly in arrears at a rate (the “Commission Rate”) calculated as follows:

	 	(a)	 	if and to the extent that the aggregate amount of the Letters of
Credit is secured by Investment Collateral, the Account Party will pay
commission:

	 	(i)	 	on the whole of the secured portion at the
relevant rate per annum set out in the following table if the Investment
Collateral comprises solely of assets falling within the descriptions of
“Cash”, “US Dollar and/or Sterling Time Deposits, CDs and Money Market
Deposits” and/or “US and/or UK Government Securities” as set out in
Schedule 5:

	 	 	 	 	 
	Alterra Bermuda Financial Strength	 	Commission Rate (per cent. per annum)
	Rating by A.M. Best	 	 	 	 
	Higher than B++

	 	 	0.35	 
	 

	 	 	 	 
	B++

	 	 	0.45	 
	 

	 	 	 	 
	Lower than B++

	 	 	0.55	 
	 

	 	 	 	 

	 	(ii)	 	on the whole of the secured portion at the
relevant rate per annum set out in the following table if the Investment
Collateral does not comprise solely of assets falling within the
descriptions of “Cash”, “US Dollar and/or Sterling Time Deposits, CDs
and Money Market Deposits” and/or “US and/or UK Government Securities”
as set out Schedule 5:

	 	 	 	 	 
	Alterra Bermuda Financial Strength	 	Commission Rate (per cent. per annum)
	Rating by A.M. Best	 	 	 	 
	Higher than B++

	 	 	0.50	 
	 

	 	 	 	 
	B++

	 	 	0.60	 
	 

	 	 	 	 
	Lower than B++

	 	 	0.70	 
	 

	 	 	 	 

	 	(b)	 	to the extent that the aggregate amount of the Letters of Credit
is not secured by Investment Collateral, the Account Party will pay commission
on the unsecured portion at the relevant rate per annum set out in the following
table:

	 	 	 	 	 
	Alterra Bermuda Financial Strength	 	Commission Rate (per cent. per annum)
	Rating by A.M. Best	 	 	 	 
	A++ or higher

	 	 	1.20	 
	 

	 	 	 	 
	A+

	 	 	1.30	 
	 

	 	 	 	 
	A

	 	 	1.40	 
	 

	 	 	 	 
	A-

	 	 	1.65	 
	 

	 	 	 	 
	B++ or lower

	 	 	2.00	 
	 

	 	 	 	 

and such commission shall be payable in respect of each Letter of Credit from the
date of issue of such Letter of Credit until the earlier of the date of final
expiration of that Letter of Credit or such date as that Letter of Credit is
cancelled.

	 	16.1.2	 	The Account Party must, as soon as practicable, notify the Agent of any publication
or announcement by A.M. Best of a change in the financial strength rating of Alterra
Bermuda.

	 	16.1.3	 	Any change in the Commission Rate will apply on the Banking Day following publication
or announcement of a change in rating.

	 	16.1.4	 	The Commission Rate shall be calculated on the basis of actual days elapsed and a 365
day year.

	16.2	 	Fees

	 	16.2.1	 	The Account Party shall pay to the Agent (for the benefit of the Banks) the fees
specified in the Fee Letter.

	 	16.2.2	 	Each such fee shall be deemed earned once it becomes due as provided in the Fee
Letter and, once paid, shall not be returnable in whole or in part in any
circumstances.

	 	16.2.3	 	The Account Party must also pay to the Agent (for the benefit of each Bank) a
commitment fee computed at the rate of 0.25% per annum on the undrawn, uncancelled
amount of each Bank’s Commitment on the basis of actual days elapsed and a 365 day
year. Accrued commitment fee is payable quarterly in arrears. Accrued commitment fee
is also payable to the Agent (for the benefit of the Banks) on the date the Commitments
of the Banks are cancelled in full.

	16.3	 	Indemnity against costs

The Account Party shall pay to the Creditor Parties on demand, and the Account Party shall
indemnify and keep the Creditor Parties indemnified against, all costs, charges, expenses,
claims, liabilities, losses, duties and fees (including, but not limited to, legal fees
properly incurred and expenses on a full indemnity basis) and taxes thereon suffered or
incurred by the Creditor Parties:

	 	16.3.1	 	in the negotiation, preparation, printing, execution and registration of this
Agreement and the other Finance Documents (subject to such overall limit as may be
separately agreed by the parties);

	 	16.3.2	 	in the enforcement or preservation or the attempted enforcement or preservation of
any of the Creditor Parties’ rights and powers under this Agreement and the other
Finance Documents or of the security constituted by the Finance Documents; and

	 	16.3.3	 	in connection with any actual or proposed amendment of or supplement to this
Agreement or any other of the Finance Documents, or with any request of or to the Agent
to grant any consent or waiver in respect of any provision of this Agreement or any
other of the Finance Documents, whether or not the same is given.

	16.4	 	Stamp duties

The Account Party shall pay any and all stamp, documentary, registration and like taxes or
charges imposed by governmental authorities in relation to this Agreement and the other
Finance Documents, and the Account Party shall indemnify the Creditor Parties against any
and all liabilities with respect to, or resulting from, delay or omission on the part of the
Account Party to pay such taxes or charges.

	16.5	 	General indemnities

The Account Party shall pay to each Creditor Party on demand, and shall indemnify each Bank
against any losses, expenses or liabilities (as to the amount of which such Creditor Party’s
certificate shall, in the absence of manifest error, be conclusive evidence) suffered or
incurred by such Creditor Party in connection with or as a result of:

	 	16.5.1	 	any Letter of Credit which the Issuing Bank (on behalf of the Banks) has agreed to
issue or make, not being issued or made or being cancelled by reason of the operation
of any one or more of the provisions of this Agreement, other than as a result of a
default by such Bank;

	 	16.5.2	 	any default in payment by the Account Party of any sum due under the Finance
Documents on its due date; or

	 	16.5.3	 	the occurrence or continuance of an Event of Default and/or a Potential Event of
Default.

	16.6	 	Currency indemnity

The following shall apply if any amount is received or recovered by any Creditor Party in
respect of any moneys or liabilities due, owing or incurred by an Obligor to such Creditor
Party (whether as a result of any judgment or order of any court or in the bankruptcy,
administration, reorganisation, liquidation or dissolution of such Obligor or by way of
damages for any breach of any obligation to make any payment to such Creditor Party) in a
currency (the “Currency of Payment”) other than Pounds Sterling in whatever circumstances
and for whatever reason:

	 	16.6.1	 	such receipt or recovery shall only constitute a discharge by such Obligor to the
extent of the amount in Pounds Sterling which such Creditor Party is able or would have
been able, on the date or dates of receipt by it of such payment or payments in the
Currency of Payment (or, in the case of any such date which is not a Banking Day, on
the next succeeding Banking Day), to purchase Pounds Sterling in the foreign exchange
market of its choice with the amount or amounts so received;

	 	16.6.2	 	if the amount of Pounds Sterling which such Creditor Party is so able to purchase
falls short of the amount originally due to such Bank, the Account Party shall
indemnify and hold such Creditor Party harmless against any loss or damage arising as a
result of such shortage by paying to such Bank that amount in Pounds Sterling certified
by such Creditor Party as necessary to so indemnify and hold harmless such Creditor
Party;

	 	16.6.3	 	this indemnity shall constitute a separate and independent obligation from the other
obligations contained in this Agreement, shall give rise to a separate and independent
cause of action, shall apply irrespective of any indulgence granted by such Creditor
Party from time to time and shall continue in full force and effect notwithstanding any
judgment or order for a liquidated sum or sums in respect of amounts due hereunder or
under any such judgment or order; and

	 	16.6.4	 	the certificate of such Creditor Party as to the amount of any such loss or damage
(which shall be deemed to constitute a loss suffered by such Creditor Party) shall
(save in case of manifest error) for all purposes be conclusive and binding on the
Account Party.

	16.7	 	Survival of indemnities

The indemnities contained in the Finance Documents shall continue in full force and effect
after the full and final discharge of the Outstanding Indebtedness with respect to matters
arising prior to such discharge.

	17.	 	GUARANTEE

	17.1	 	Guarantee

In consideration of the Banks entering into this Agreement or otherwise providing or
continuing to make banking facilities available to the Account Party, or granting time to
the Account Party, the Guarantor hereby irrevocably and unconditionally:

	 	17.1.1	 	guarantees to the Security Trustee the due and punctual payment by the Account Party
of all the Outstanding Indebtedness; and

	 	17.1.2	 	undertakes as primary obligor and not as surety only that, if and whenever the
Account Party fails to pay on the due date any fees as part of the Outstanding
Indebtedness, the Guarantor shall pay, or cause to be paid by a member of the Group,
such sum on demand to the Security Trustee.

	17.2	 	Indemnity

As a separate and independent stipulation, the Guarantor hereby irrevocably and
unconditionally agrees that, if any amounts hereby guaranteed are not recoverable on the
footing of a guarantee, whether by reason of any legal limitation, disability or incapacity
on or of the Account Party or any other fact or circumstance, whether known to the Security
Trustee or the Guarantor or not, then such amounts shall nevertheless be recoverable from
the Guarantor as sole or principal debtor and shall be payable by the Guarantor on demand.

	17.3	 	Interest on late payments

If the Guarantor fails to pay on the due date any sum (whether of principal, interest or
otherwise) due under this Clause, interest will accrue, and become payable upon demand by
the Security Trustee, upon the sum unpaid from and including the date upon which it fell due
at the Default Rate for periods of such duration as the Security Trustee may determine from
time to time. For so long as the default continues such rate of interest shall be
recalculated on a similar basis at the end of each successive period so determined by the
Security Trustee. Any such interest which is not paid when due shall be compounded at the
end of each such period determined by the Security Trustee for so long as it remains unpaid.

	17.4	 	Continuing obligations

The obligations of the Guarantor are a continuing guarantee and will extend to the ultimate
balance of all sums payable by the Account Party under the Finance Documents, regardless of
any intermediate payment or discharge in whole or in part.

	17.5	 	Reinstatement

If any discharge of the Outstanding Indebtedness or arrangement is made in whole or in part
on the faith of any payment, security or other disposition which is avoided or must be
restored on insolvency, liquidation, administration or to be reinstated or otherwise without
limitation, the liability of the Guarantor under this Clause will continue or be reinstated
as if the discharge or arrangement had not occurred.

	17.6	 	Waiver of defences

The obligations of the Guarantor under this Clause will not be affected by any act, omission
or thing which, but for this provision, would reduce, release or prejudice any of its
obligations under this Clause (whether or not known to it). This includes:

	 	17.6.1	 	any time or waiver granted to, or composition with, any person;

	 	17.6.2	 	any release of any person under the terms of any composition or arrangement;

	 	17.6.3	 	the taking, variation, compromise, exchange, renewal or release of, or refusal or
neglect to perfect, take up or enforce, any rights against, or security over assets of,
any person;

	 	17.6.4	 	any non-presentation or non-observance of any formality or other requirement in
respect of any instrument or any failure to realise the full value of any security;

	 	17.6.5	 	any incapacity or lack of power, authority or legal personality of or dissolution or
change in the members or status of any person;

	 	17.6.6	 	any amendment (however fundamental) of a Finance Document or any other document or
security;

	 	17.6.7	 	any unenforceability, illegality, invalidity or non-provability of any obligation of
any person under any Finance Document or any other document or security; or

	 	17.6.8	 	any insolvency or similar proceedings.

	17.7	 	Immediate recourse

	 	17.7.1	 	The Guarantor waives any right it may have of first requiring the Security Trustee to
proceed against or enforce any other right or security or claim payment from any person
before claiming from the Guarantor under this Clause.

	 	17.7.2	 	This waiver applies irrespective of any law or any provision of a Finance Document to
the contrary.

	17.8	 	Appropriations

Until all amounts which may be or become payable by the Guarantor have been irrevocably paid
in full, the Security Trustee may without affecting the liability of the Guarantor under
this Clause:

	 	17.8.1	 	refrain from applying or enforcing any other moneys, security or rights held or
received; or

	 	17.8.2	 	apply and enforce them in such manner and order as it sees fit (whether against those
amounts or otherwise).

	17.9	 	Non-competition

Unless:

	 	17.9.1	 	all amounts which may be or become payable by the Guarantor have been irrevocably
paid in full; or

	 	17.9.2	 	the Agent otherwise directs

the Guarantor will not after a claim has been made or by virtue of any payment or
performance by it under this Clause:

	 	(a)	 	be subrogated to any rights, security or moneys held, received or
receivable by the Security Trustee;

	 	(b)	 	be entitled to any right of contribution or indemnity in respect
of any payment made or moneys received on account of its liability under this
Clause; or

	 	(c)	 	claim, rank, prove or vote as a creditor of its estate in
competition with the Security Trustee.

	17.10	 	Additional Security

The rights of the Security Trustee under this Clause are in addition to and are not in any
way prejudiced by any other security now or subsequently held by it.

	18.	 	INCREASED COST

	18.1	 	Causes of increased cost

This Clause 18 applies to any Bank (the “Affected Bank”) if as a result of (a) the
introduction of or any change in any applicable law, regulation or official directive
(whether or not having the force of law), or in the interpretation thereof by any authority
charged with the administration thereof or by any court of competent jurisdiction, or (b)
compliance with any directive, request or requirement from any applicable governmental,
fiscal or monetary authority (whether or not having the force of law):

	 	18.1.1	 	there is any change in the basis of taxation (other than the basis of taxation of the
Affected Bank’s overall net income) of payments by the Account Party to the Affected
Bank;

	 	18.1.2	 	there is any change in the basis of taxation of payments by the Affected Bank of
principal or interest on, or otherwise in respect of, deposits taken from third parties
to enable the Affected Bank to indemnify the Issuing Bank in respect of any Letter of
Credit or (in the case of the Issuing Bank) to issue or amend any Letter of Credit;

	 	18.1.3	 	any reserve, special deposit, cash ratio, liquidity or other requirements are
imposed, modified or deemed applicable against assets held by or deposits in or for the
account of, or loans by, the Affected Bank (including, without limitation, any such
requirements arising out of or attributable to the implementation or application of or
compliance with the “International Convergence of Capital Measurement and Capital
Standards, a Revised Framework” published by the Basel Committee on Banking Supervision
in June 2004 in the form existing on the date of this Agreement (“Basel II”) or any
other law or regulation which implements Basel II); or

	 	18.1.4	 	any other condition is imposed on the Affected Bank in respect of the transactions
contemplated by this Agreement or any other of the Finance Documents,

	 	 	 	 	 
	 	18.2	 	 	and, as a result, the Affected Bank incurs an increased cost.

Types of increased cost

An increased cost is:

	 	18.2.1	 	any additional cost to the Affected Bank of entering into and performing this
Agreement including indemnifying the Issuing Bank in respect of any Letter of Credit or
(in the case of the Issuing Bank) issuing or amending any Letter of Credit; or

	 	18.2.2	 	any reduction in any amount payable or the effective return to the Affected Bank
under this Agreement; or

	 	18.2.3	 	the amount of any payment made by the Affected Bank or the amount of any interest or
other return forgone by the Affected Bank calculated by reference to any amount
received or receivable by the Affected Bank from any other person who is a party to
this Agreement or any Finance Documents.

	18.3	 	Notification

The Affected Bank shall promptly notify the Agent, the other Banks and the Account Party of
any increased cost incurred by the Affected Bank.

	18.4	 	Indemnification of Bank

The Account Party shall pay to the Affected Bank from time to time upon demand such
additional moneys as the Affected Bank shall specify to be necessary to indemnify the
Affected Bank for any increased cost.

	18.5	 	No defence

It shall not be a defence to a claim by the Affected Bank under this Clause 18 that any
increased cost could have been avoided by the Affected Bank. However, each Creditor Party
shall, in consultation with the Account Party, take all reasonable steps to mitigate any
circumstances which arise or would result in any amount becoming payable under or pursuant
to Clause 18, including, but not limited to, its rights and obligations under the Finance
Documents being moved to an affiliate or another facility office.

	 	 	 	 	 	 	 
	18.6	 	Market disruption	 	 
	 	 	In this Agreement a “Market Disruption Event” shall occur if:
	
 
	 	 	18.6.1	 	 	on or about noon on the Quotation Day the Screen Rate is not available; or

	 	18.6.2	 	before close of business in London on the Quotation Day, the Agent receives
notification from a Bank (an “Affected Bank”) that the cost to it of obtaining matching
deposits in the London interbank market would be in excess of LIBOR or that such Bank
is unable on the Quotation Day to obtain matching deposits in the London interbank
market in sufficient amounts to enable it to fund any applicable amount.

If a Market Disruption Event occurs and the Agent, the Affected Bank (if applicable) and/or
the Account Party so require, the Agent and the Account Party shall enter into negotiations
(for a period of not more than 30 days) with a view to agreeing a substitute basis for
determining a rate of interest. Any alternative basis so agreed shall, with the prior
consent of the Account Party and all the Banks or (as the case may be) the Affected Bank,
be binding on all of the parties. In the absence of such agreement, LIBOR shall be
determined by the Agent to be equal to the cost of funds of the Banks (or the relevant one
of them) in obtaining such matching deposits, having used reasonable endeavours to keep
such costs to a minimum.

	18.7	 	Separate debt

Any amount due from the Account Party under this Clause 18 shall be due as a separate debt
and shall not be affected by judgment being obtained for any other sums due under or in
respect of this Agreement.

	19.	 	ILLEGALITY

	19.1	 	Causes of illegality

This Clause 19 applies if the introduction of, or any change in, any applicable law or
regulation, or in the interpretation thereof by any authority charged with the
administration thereof or by any court of competent jurisdiction, makes it unlawful for a
Bank (the “Affected Bank”) to maintain or give effect to its obligations under this
Agreement.

	19.2	 	Notification

The Affected Bank shall promptly notify the Agent, the other Banks and the Account Party of
the occurrence of any of the circumstances described in Clause 19.1.

	19.3	 	Mandatory cash cover

On so notifying the Account Party, the Affected Bank’s obligations under this Agreement
shall terminate at the end of the expiry of 30 Banking Days’ notice (unless the
circumstances necessitate termination forthwith) and the Account Party shall provide cash
cover to the Affected Bank for all amounts for which the Affected Bank is actually or
contingently liable under all Letters of Credit then outstanding promptly on demand on such
termination.

	19.4	 	Force majeure

Neither the Issuing Bank nor any other Creditor Party will be liable for any failure on its
part to issue or amend any Letter of Credit resulting, directly or indirectly, from any
action, inaction or purported action of any government or governmental agency or any strike,
boycott or blockade or any cause whatsoever outside its control.

	20.	 	THE AGENT

	20.1	 	Appointment of Agent

Each Bank hereby irrevocably appoints and authorises the Agent to act as its agent under
this Agreement and the other Finance Documents.

	20.2	 	Agent’s powers and discretions

The Agent shall have the powers and discretions:

	 	20.2.1	 	which are expressly delegated to the Agent by the terms of this Agreement and the
other Finance Documents;

	 	20.2.2	 	which the applicable Majority Banks consider appropriate and give to the Agent
(generally or in a particular case) with the Agent’s consent;

	 	20.2.3	 	which the Agent considers to be reasonably incidental to the discharge and
performance of any of its functions under this Agreement or any of the other Finance
Documents or otherwise appropriate in the context of those functions, including the
exercise of any powers given to it by the applicable Majority Banks; and

	 	20.2.4	 	to instruct the Issuing Bank to issue Letters of Credit on behalf of the Banks.

	20.3	 	Agent is agent only

The relationship between the Agent and each Bank is that of agent and principal only.
Nothing in this Agreement or the other Finance Documents shall constitute the Agent a
trustee or fiduciary for any Bank or any other person and no action taken by the Banks
pursuant hereto or thereto shall be deemed to constitute the Banks a partnership,
association, joint venture or other entity.

	20.4	 	Agent to have no responsibility to Account Party

In performing its functions and duties under this Agreement and the other Finance Documents,
the Agent shall act solely as agent of the Banks and does not assume and shall not be deemed
to have assumed any responsibility, liability or obligation (whether fiduciary or otherwise)
towards, or relationship of agency or trust with or for, the Account Party or any other
Obligor in any circumstances whatsoever.

	20.5	 	Matters within Agent’s authority

Subject to Clause 20.6 and the other provisions of this Agreement and the other Finance
Documents, the Agent is hereby irrevocably authorised by the Issuing Bank and the Banks in
their name and on their behalf (and shall, if so directed by written notice from all of the
Banks):

	 	20.5.1	 	to waive, modify, vary or otherwise amend or excuse performance of any provisions of
this Agreement or any of the other Finance Documents; and

	 	20.5.2	 	to enforce or take or refrain from taking any other action or proceedings with regard
to this Agreement or any of the other Finance Documents,

	20.6	 	Notification of proposed waivers and amendments

Except in cases where the Agent is of the opinion that the Banks would be prejudiced by any
delay in the Agent enforcing or taking action, in which event the Agent may, but shall not
be obliged to, enforce or take action without prior notification to the Banks, the Agent
shall be obliged to notify the Banks if it proposes to waive, modify, vary or otherwise
amend or excuse performance of any provision of this Agreement or any of the other Finance
Documents or to enforce or take or refrain from taking any action under Clause 15.2 and the
Agent shall not be entitled to proceed with that proposal unless the applicable Majority
Banks shall give notice to the Agent agreeing to that proposal. The Agent shall be entitled
to cancel that proposal if written notice pursuant to this Clause 20.6 is not received
within 5 days of the Banks being so notified by the Agent.

	20.7	 	Agent to act in accordance with instructions of applicable Majority Banks

Subject to the provisions of this Agreement and the other Finance Documents, the Agent
agrees to act with respect to this Agreement and the other Finance Documents in accordance
with the written instructions of the applicable Majority Banks. Any such instructions given
by the applicable Majority Banks shall be binding on all the Banks. In the absence of any
such instructions, the Agent shall not be obliged to act.

	20.8	 	Agent not required to act

In no event shall the Agent be required to take any action which exposes, or is likely to
expose, the Agent to personal liability or which is contrary to the provisions of:

	 	 	 	 	 
	 	20.9	 	 	20.8.1this Agreement or any of the other Finance Documents; or

20.8.2any law, regulation or directive.

Provision of copy documents to Banks

The Agent shall furnish each Bank with copies of:

	 	20.9.1	 	any documents received by it under Clause 10 (but the Agent shall not be obliged to
review or check the accuracy or completeness thereof); and

	 	20.9.2	 	if requested by any Bank, with copies of all documents received by the Agent under
Clause 10.

	20.10	 	Provision of copy communications to Agent

Each Bank will, promptly after receipt or despatch thereof, forward to the Agent a copy of
any communication:

	 	20.10.1	 	sent by that Bank to the Account Party or any other Obligor; or

	 	20.10.2	 	received by that Bank from the Account Party or any other Obligor and, in each case,
relating to this Agreement or any of the Finance Documents.

	20.11	 	Distributions of sums received and deductions by Agent

The Agent shall (subject to Clause 5.2) distribute promptly to each Bank its due proportion
of all sums received by the Agent on behalf of the Banks under this Agreement or any of the
other Finance Documents, subject to the Agent’s right to deduct and withhold from any such
payment any amount which is then (or which will, upon demand by the Agent, become) due and
payable to the Agent from that Bank.

	20.12	 	Agent’s retention of fees and expenses

The Agent may retain for its own use and benefit (and shall not be liable to account to any
Bank for all or any part of) any sums received by it by way of fees (and not payable to any
Bank) or by way of reimbursement of expenses incurred by it.

	20.13	 	Waiver on instructions of Majority Banks

Subject to Clauses 20.6 and 20.14, the provisions of this Agreement and any of the other
Finance Documents may be waived, and (subject to the written agreement of each of the other
parties thereto, other than the Banks) varied or amended, by the Agent acting on the written
instructions of the applicable Majority Banks, in each case evidenced by an instrument in
writing, and any such waiver, variation or amendment shall be binding upon all the Banks.

	20.14	 	Consent of Agent and all Banks required

Nothing in Clause 20.13 shall authorise the effecting, without the prior written consent of
the Agent and all of the Banks, of:

	 	20.14.1	 	any change in the definitions of “Majority Banks”, “Finance Documents” or “Letter of
Credit”;

	 	20.14.2	 	any change in the date for, or alteration in the amount (or the basis of determining
the amount) of, any payment of principal, interest, fees or other amounts payable under
this Agreement;

	 	 	 
	20.14.3

20.14.4

20.14.5
	 	any change in a Bank’s Commitment;

any extension of the Commitment Period;

any change to Clauses 2, 3, 4, 6, 8, 9, 10, 11, 13, 14, 15, 16, 20, 24 or 31;

	 	20.14.6	 	the release of any of the security created by or pursuant to the Finance Documents
(or any of them); or

	 	20.14.7	 	any other matter in respect of which the terms of this Agreement or any other of
the Finance Documents expressly requires the agreement of all the Banks.

	20.15	 	Account Party’s reliance upon Agent

At all times throughout the Security Period the Account Party shall be entitled to rely upon
the advice of the Agent as to the giving of any approvals or consents or the exercise of any
discretions by the Banks or any other act of the Banks as required by this Agreement and/or
the other Finance Documents or any of them.

	20.16	 	Consultation by Agent with Banks

The Agent shall, subject to Clause 20.6, at all times:

	 	20.16.1	 	consult with the Banks before giving any approvals or consents or exercising any
discretions or performing any other act which may be given or exercised or performed by
the Agent under this Agreement or any of the other Finance Documents; and

	 	20.16.2	 	keep the Banks informed of each and every approval or consent given and each
exercise of any such discretion and each performance of any such other act which the
Agent may have performed on behalf of the Banks as required by this Agreement or any of
the other Finance Documents.

	20.17	 	Consent of Agent required

Notwithstanding the provisions of Clause 20.13 and 20.14, no provision of this Agreement or
of any other of the Finance Documents which in any way relates to the duties, functions,
powers or responsibilities of the Agent may be amended, waived or suspended without the
prior consent of the Agent.

	21.	 	THE SECURITY TRUSTEE

	21.1	 	Trust Property defined

In this Clause 21, “Trust Property” means:

	 	21.1.1	 	all rights, title and interests that may be mortgaged, charged, pledged or assigned
in favour of the Security Trustee under or by virtue of this Agreement and the other
Finance Documents;

	 	21.1.2	 	all rights granted to, or held or exercisable by, the Security Trustee by virtue of
this Agreement and the other Finance Documents;

	 	21.1.3	 	all moneys and other assets, which are received or recovered by or on behalf of the
Security Trustee under or by virtue of any of the foregoing rights, including as a
result of the enforcement or exercise of any such right; and

	 	21.1.4	 	all moneys and other assets accrued in respect of or derived from any of the
foregoing.

	21.2	 	Duties of Security Trustee

The Security Trustee shall:

	 	21.2.1	 	hold the Trust Property on trust for the Banks in accordance with provisions of this
Agreement and the other Finance Documents; and

	 	21.2.2	 	perform and exercise the rights and benefits vested in it and deal with the Trust
Property in accordance with the provisions of this Agreement and the other Finance
Documents.

	21.3	 	Security Trustee to have no responsibility to Obligors

The Security Trustee does not assume and shall not be deemed to have assumed any
responsibility, liability or obligation (whether fiduciary or otherwise) towards, or
relationship of agency or trust with or for, the Account Party or any other Obligor in any
circumstances whatsoever.

	21.4	 	Security Trustee’s powers and discretions

The Security Trustee shall have the powers and discretions:

	 	21.4.1	 	which are expressly delegated to the Security Trustee by the terms of this Agreement
and the other Finance Documents;

	 	21.4.2	 	which the applicable Majority Banks consider appropriate and give to the Security
Trustee (generally or in a particular case) with the Security Trustee’s consent;

	 	21.4.3	 	which the Security Trustee considers to be reasonably incidental and conducive to the
discharge and performance of any of its functions under this Agreement or any of the
other Finance Documents or otherwise appropriate in the context of those functions,
including the exercise of any powers given to it by the applicable Majority Banks; and

	 	21.4.4	 	which are conferred on a trustee by the Trustee Act 1925 and by the Trustee Act 2000
and any other applicable law for the time being in force.

	21.5	 	Security Trustee to act in accordance with instructions of applicable Majority Banks

Subject to the provisions of the Agreement and the other Finance Documents, the Security
Trustee agrees to act with respect to this Agreement and the other Finance Documents in
accordance with the written instructions of the Agent, or, if the Agent and the Security
Trustee are the same person, the applicable Majority Banks. Any such instructions given by
the applicable Majority Banks shall be binding on all the Banks. In the absence of any such
instructions, the Security Trustee shall not be obliged to act.

	21.6	 	Security Trustee not required to act

In no event shall the Security Trustee be required to take any action which exposes, or is
likely to expose, the Security Trustee to personal liability or which is contrary to the
provisions of:

	 	 	 	 	 
	 	21.7	 	 	21.6.1this Agreement or any of the other Finance Documents; or

21.6.2any law, regulation or directive.

Provision of copy documents to Banks

The Security Trustee shall furnish the Agent, or, if the Agent and the Security Trustee are
the same person, each Bank, with copies of any documents received by it under or in
connection with this Agreement or any other Finance Documents which it considers to be of
material importance to the Banks.

	21.8	 	Transfer of moneys to Agent

The Security Trustee shall, except as expressly stated to the contrary in this Agreement or
any other Finance Document, transfer any moneys forming part of the Trust Property to the
Agent for application in accordance with the relevant provisions of this Agreement and the
other Finance Documents, subject to the Security Trustee’s right to deduct and withhold from
any such payment any amount which is then (or which will, upon demand by the Security
Trustee, become) due and payable to it, or to any receiver or agent appointed by it, under
the Finance Documents.

	21.9	 	Security Trustee’s retention of fees and expenses

The Security Trustee may retain for its own use and benefit (and shall not be liable to
account to any Bank for all or any part of) any sums received by it by way of fees (and not
payable to any Bank) or by way of reimbursement of expenses incurred by it.

	21.10	 	Release of security

At the end of the Security Period the Security Trustee shall release without any recourse,
warranty or covenants for title whatsoever, all security granted to it pursuant to the
Finance Documents then held by it, whereupon the Security Trustee shall be discharged from
all liabilities and obligations under this Agreement and the other Finance Documents.

	21.11	 	Perpetuity period

The perpetuity period applicable to the trusts created by this Clause 21 is 125 years from
the date of this Agreement.

	22.	 	RETIREMENT OF A SERVICE BANK

	22.1	 	Resignation of Service Bank

A Service Bank may at any time resign its appointment under this Agreement by giving the
Obligors and the other Creditor Parties not less than 30 days prior written notice to that
effect.

	22.2	 	Appointment of successor by Majority Banks

After the giving by a Service Bank of a notice of termination the Majority Banks may in
writing appoint a successor.

	22.3	 	Appointment by retiring Service Bank

If no such successor is appointed within the period specified in Clause 22.1, the relevant
Service Bank may appoint as its successor any reputable bank or financial institution with
an office in London.

	22.4	 	Consequence of change of Service Bank

Upon the acceptance by a successor to a Service Bank of its appointment, which acceptance
shall be in such form as the Majority Banks shall approve:

	 	22.4.1	 	that successor shall become bound by all the obligations of that Service Bank and
become entitled to all the rights, privileges, powers, authorities and discretions of
that Service Bank under this Agreement and the other Finance Documents;

	 	22.4.2	 	the obligations of that Service Bank under this Agreement and the other Finance
Documents shall terminate but without prejudice to any liabilities which that Service
Bank may have incurred prior to that termination;

	 	22.4.3	 	that Service Bank shall be discharged from any further liability or obligations under
this Agreement and the other Finance Documents; and

	 	22.4.4	 	the provisions of this Agreement and the other Finance Documents shall continue in
effect for the benefit of that Service Bank in respect of any action taken or omitted
to be taken by it or any event occurring before the termination of its obligations
pursuant to this Clause 22.

	23.	 	LIMITS OF THE SERVICE BANKS’ OBLIGATIONS

	23.1	 	No duty to enquire

Neither Service Bank shall be obliged to ascertain or enquire:

	 	23.1.1	 	either initially or on a continuing basis, as to the credit or financial condition or
affairs of the Account Party, any other Obligor or any other person;

	 	23.1.2	 	as to the performance or observance by the Account Party or any other Obligor of any
of the terms and conditions of this Agreement or any of the other Finance Documents or
any other agreement; or

	 	23.1.3	 	whether any Event of Default or Potential Event of Default has occurred, and until it
shall have actual knowledge or express notice to the contrary, the Agent shall be
entitled to assume that no Event of Default or Potential Event of Default has occurred.

	23.2	 	Responsibilities excluded

Neither Service Bank and none of their respective officers, employees or agents shall be
responsible to any other Creditor Party for:

	 	23.2.1	 	any failure or delay in performance, or breach by the Account Party of their
obligations, under this Agreement or any of the other Finance Documents or any other
agreement or any failure or delay in performance, or breach by any of the other
Obligors, of their respective obligations under any of the Finance Documents or any
other agreement; or

	 	23.2.2	 	any recitals, statements, representations or warranties in, or for the legality,
validity, effectiveness, enforceability, admissibility in evidence or sufficiency of,
this Agreement or any of the other Finance Documents or any other agreement; or

	 	23.2.3	 	the legality, validity, effectiveness or enforceability of any of the security
created, or purported to be created, pursuant to any of the Finance Documents.

	23.3	 	Limitation of liability

	 	23.3.1	 	Neither Service Bank and none of their respective officers, employees or agents shall
be liable for any loss, damage or expense suffered or incurred by the Account Party or
any Creditor Party or any other person in consequence of any action taken or omitted to
be taken by it under this Agreement or any of the other Finance Documents or in
connection herewith or therewith unless caused by its fraud, misconduct or negligence.

	 	23.3.2	 	Without prejudice to the provisions of Clause 23.3.1, none of the other parties to
this Agreement shall take any proceedings against any officer, employee or agent of a
Service Bank in respect of any claim which it may have against that Service Bank or in
respect of any act or omission (including, without limitation, misconduct or
negligence) by that officer, employee or agent in relation to this Agreement or any of
the other Finance Documents.

	23.4	 	Banks’ representations and undertakings

Each Bank:

	 	23.4.1	 	severally represents and warrants to the Service Banks that it has made its own
independent investigation of the financial condition and affairs of the Account Party
and the other Obligors in connection with the entry by that Bank into this Agreement
and in that respect has not relied on any information provided to it by either Service
Bank; and

	 	23.4.2	 	undertakes that it will continue to make its own independent appraisal of the
creditworthiness of the Account Party and the other Obligors and will not rely on any
information provided to it by either Service Bank.

	23.5	 	Indemnification by Banks of Service Banks

The Banks agree (which agreement shall survive payment of all sums due under this Agreement)
to indemnify each Service Bank (to the extent not reimbursed by the Account Party) rateably
according to their respective Commitments from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses and
disbursements of any kind or nature whatsoever which may be imposed on, incurred by or
asserted against that Service Bank:

	 	23.5.1	 	in performing its functions or duties under this Agreement or any of the other
Finance Documents; or

	 	23.5.2	 	in connection with any action taken or omitted to be taken by that Service Bank in
enforcing or preserving or attempting to enforce or preserve the rights of the Banks
under this Agreement or any of the other Finance Documents or any other documents or
security.

	23.6	 	Service Banks’ rights

Each Service Bank may:

	 	23.6.1	 	engage and pay for the advice and services of any lawyers, accountants or other
experts whose advice or services may to that Service Bank seem necessary or desirable
and that Service Bank shall be entitled to rely on the advice and opinions of such
lawyers, accountants and other experts and shall not be liable to any of the other
parties hereto for any of the consequences of any such reliance;

	 	23.6.2	 	perform all or any of its functions and duties hereunder or under the Finance
Documents through employees or agents or any office or branch of that Service Bank from
time to time selected by it and notified to the other parties hereto;

	 	23.6.3	 	rely on any communication or document believed by it to be genuine and correct and to
have been communicated or signed by the person by whom it purports to be communicated
or signed and shall not be liable to any of the other parties hereto for any of the
consequences of such reliance; and

	 	23.6.4	 	without liability to account, make loans to, accept deposits from and generally
engage in any kind of banking or trust business with the Account Party or the other
Obligors as though that Service Bank was not a Service Bank.

	23.7	 	Service Banks as Banks

If it is also a Bank, each Service Bank shall have the same rights and powers under this
Agreement as any other Bank and may exercise those rights and powers as though it were not a
Service Bank.

	24.	 	SHARING OF PAYMENTS

	24.1	 	Relevant circumstances

This Clause 24 applies if any Bank (the “Sharing Bank”) at any time receives or recovers
(whether by way of voluntary or involuntary payment, by virtue of the exercise of its legal
rights, including, but not limited to, the right of set-off, counterclaim or otherwise
howsoever) the whole or any part of any amounts due to it from the Account Party under this
Agreement or any of the other Finance Documents otherwise than by distribution from the
Agent in accordance with the terms of this Agreement or from the proceeds of any cash cover
provided to the Sharing Bank under Clause 19.3.

	24.2	 	Payment by Sharing Bank to Agent

Subject to Clauses 24.3 and 24.4:

	 	24.2.1	 	the Sharing Bank shall forthwith pay to the Agent the full amount or (as the case may
be) an amount equal to the equivalent of the full amount so received or recovered;

	 	24.2.2	 	as between the Account Party and the Sharing Bank, the Account Party shall remain or
again become indebted to such Sharing Bank under this Agreement in the amount so paid
as if it had not been received or recovered as aforesaid; and

	 	24.2.3	 	the Agent shall treat the amount so paid as if it were a payment by the Account Party
on account of amounts due from the Account Party under this Agreement or any of the
other Finance Documents for distribution to the Sharing Bank and such of the other
Banks in the proportions in which the Sharing Bank and the other Banks would have been
entitled to receive such amount had it been paid by the Account Party to the Agent
hereunder or under such Finance Documents.

	24.3	 	Refund by Agent

Any payment and adjustment made pursuant to Clause 24.2 shall be subject to the condition
that, if the amount (or any part thereof) so paid by the Sharing Bank to the Agent
subsequently falls to be repaid by the Sharing Bank to the Account Party or any other
person, then each of the Banks which has received any part thereof from the Agent shall
repay the amount received by it to the Sharing Bank, together with such amount (if any) as
is necessary to reimburse the Sharing Bank the appropriate portion of any interest it has
been obliged to pay when repaying such amount as aforesaid, and the relevant adjustments
pursuant to Clause 24.2 shall be cancelled.

	24.4	 	No sharing required

A Sharing Bank which has commenced or joined in an action or proceeding in any court to
recover sums due to it under this Agreement or any of the other Finance Documents, and
pursuant to a judgment obtained therein or a settlement or compromise of that action or
proceeding shall have received any amount, shall not be required to share any proportion of
that amount with a Bank which has the legal right to, but does not, join in such action or
proceeding or commence and diligently prosecute a separate action or proceeding to enforce
its rights under this Agreement or any of the other Finance Documents in the same or another
court.

	24.5	 	Matters notifiable

Each Bank shall promptly give notice to the Agent of:

	 	24.5.1	 	the institution by that Bank of a legal action or proceedings against the Account
Party under this Agreement or under any of the other Finance Documents or in connection
therewith as soon as practicable thereafter (and, in any event, within 5 Banking Days);
and

	 	24.5.2	 	the receipt or recovery by that Bank of any amount due and payable by the Account
Party under this Agreement or under any of the other Finance Documents which is
received or recovered otherwise than through the Agent.

Upon receipt of any such notice the Agent will as soon as practicable thereafter notify the
other Banks.

	25.	 	JOINT AND SEVERAL LIABILITY

	 	 	 
	25.1	 	Account Parties
	25.2

	 	The following provisions of this Clause shall apply if there are two or more Account Parties.

Joint and several

All obligations and liabilities imposed on or assumed by the Account Parties under or
pursuant to this Agreement and the other Security Documents are joint and several even if
not so expressed.

	25.3	 	Obligations not affected

None of the obligations and liabilities of the Account Parties under this Agreement and the
other Security Documents shall be impaired by:

	 	25.3.1	 	any failure of this Agreement or any other of the Security Documents to be legal,
valid, binding and enforceable in relation to any of the Account Parties or any other
Obligor whether as a result of lack of corporate capacity, due authorisation, effective
execution or otherwise;

	 	25.3.2	 	any giving of time, forbearance, indulgence, waiver or discharge in relation to any
of the Account Parties or any other Obligor; or

	 	25.3.3	 	any other matter or event whatsoever which might have the effect of impairing all or
and of the liabilities any obligations of any of the Account Parties or any other
Obligor.

	25.4	 	Principal debtors

Each of the Account Parties declares that it is and will, throughout the Security Period,
remain a principal debtor for the payment of the Outstanding Indebtedness and none of the
Account Parties shall in any circumstances be construed to be a surety for the obligations
of any other Account Parties hereunder.

	25.5	 	Subordination

No Account Party (hereinafter called a “Creditor Account Party”) will without the prior
written consent of the Agent or unless so directed by the Agent (whereupon that Account
Party shall act in accordance with the Agent’s directions) ask, demand, sue for, take or
receive from any other Account Party (hereinafter called a “Debtor Account Party”) by
set-off or any manner the whole or any part of all present and future sums, liabilities and
obligations payable or owing by a Debtor Account Party to a Creditor Account Party whether
actual or contingent, jointly or severally or otherwise howsoever, until the Outstanding
Indebtedness has been paid and discharged in full.

	26.	 	ASSIGNMENTS AND TRANSFERS

	26.1	 	Successors and assigns

This Agreement shall be binding upon and inure to the benefit of each party hereto and its
successors and assigns.

	26.2	 	No assignment by Account Party

Neither the Account Party, the Applicant nor the Guarantor may assign or transfer all or any
of its rights, benefits or obligations under this Agreement or under any of the other
Finance Documents without the prior written consent of the Agent with the Majority Banks’
authority.

	26.3	 	Transfer by Banks

Any Bank (the “Transferor Bank”) may, with the prior written consent (such consent not to be
unreasonably withheld or delayed) of the Account Party transfer all or any of its rights
and/or obligations in its capacity as a Bank under this Agreement and under the other
Finance Documents to another bank or financial institution (the “Transferee Bank”). That
transfer shall be effected by the delivery by the Transferor Bank to the Agent of a Transfer
Certificate executed by the Transferor Bank and the Transferee Bank. Any such transfer
shall not be effective unless it is effected by a Transfer Certificate.

	26.4	 	Signature of Transfer Certificate

The Agent shall as soon as practicable but not later than the 5th Banking Day after receipt
by it of a Transfer Certificate:

	 	26.4.1	 	sign the Transfer Certificate on behalf of the Obligors, itself and each of the other
Creditor Parties; and

	 	26.4.2	 	give notice to the Obligors and the other Creditor Parties of receipt, and attaching
a copy, duly signed by it, of that Transfer Certificate.

	26.5	 	Authorisation of Agent to sign Transfer Certificate

The Account Party, the Applicant, the Guarantor, each Bank, the Issuing Bank and the
Security Trustee irrevocably authorise the Agent to sign any Transfer Certificate on its
behalf.

	 	 	 	 	 	 	 
	26.6	 	Effective date of Transfer Certificate
	 	 	A Transfer Certificate shall be effective on the later of:
	
 
	 	 	26.6.1	 	 	the date specified in that Transfer Certificate; and

	 	26.6.2	 	the date of receipt by the Obligors and the other Creditor Parties of the notice
given by the Agent pursuant to Clause 26.4.2.

	26.7	 	Effect of Transfer Certificate

A Transfer Certificate shall have effect in accordance with the following:

	 	26.7.1	 	to the extent that in that Transfer Certificate the Transferor Bank seeks to transfer
its rights and/or its obligations under this Agreement and the other Finance Documents,
each Obligor and the Transferor Bank shall each be released from further obligations to
the other under this Agreement and the other Finance Documents and their respective
rights against each other shall be cancelled (such rights and obligations being
referred to in this Clause 26.7 as “discharged rights and obligations”);

	 	26.7.2	 	each Obligor, the Transferee Bank and the other Creditor Parties shall each assume
obligations towards each other and/or acquire rights against each other which differ
from the discharged rights and obligations only insofar as the Transferee Bank has
assumed and/or acquired the same in place of the Transferor Bank;

	 	26.7.3	 	the Transferee Bank and the other Creditor Parties shall acquire the same rights and
assume the same obligations between themselves as they would have acquired and assumed
had the Transferee Bank been an original party to this Agreement as a Bank with the
rights and/or obligations acquired or assumed by it as a result of that transfer; and

	 	26.7.4	 	nothing in that Transfer Certificate shall operate to release the Transferor Bank
from any obligation of confidentiality to any Obligor under or in connection with this
Agreement or from any claim that any Obligor may have against it in tort.

	26.8	 	Transfer fee

The Transferee Bank shall pay to the Agent for its own account a transfer fee of £2,000 on
the date on which the transfer effected by the relevant Transfer Certificate becomes
effective.

	26.9	 	Sub participation by Banks

Any Bank may at any time, sub-participate all or any of its rights and/or obligations under
this Agreement and the other Finance Documents.

	26.10	 	Disclosure of information

Any Bank may disclose in confidence (on the basis that such Bank may disclose the
information to any potential Transferee Bank, assignee or sub-participant, or to any other
party with whom it may propose to enter into contractual relations in connection with this
Agreement or any other of the Finance Documents, provided that at the time of such
disclosure the Agent informs the Banks that the information was provided on a confidential
basis and the Banks treat and hold such information for all purposes as confidential) to any
potential Transferee Bank, assignee or sub-participant, or to any other party with whom it
may propose to enter into contractual relations in connection with this Agreement or any
other of the Finance Documents, such information about the Account Party and the other
Obligors and their respective businesses, assets or financial condition as that Bank shall
consider appropriate.

	26.11	 	Change of lending office

Any Creditor Party may at any time and from time to time change its lending office by giving
notice to the Agent and that change shall be effective on the later of:

	 	26.11.1	 	the date specified in that notice; and

	 	26.11.2	 	the date of receipt by the Agent of that notice from that Creditor Party.

The Agent shall promptly notify the Obligors and the other Creditor Parties of any notice
received by it pursuant to this Clause 26.11.

	26.12	 	Delegation

Any Creditor Party may at any time and from to time to time delegate any one or more of its
rights, powers and/or obligations under this Agreement and the other Finance Documents to
any person provided that the delegating Creditor Party informs the delegate that all
information provided by the delegating Creditor Party to the delegate in connection with
such delegation was provided to the delegating Creditor Party on a confidential basis and
the delegate treats and holds such information for all purposes as confidential).

	26.13	 	Further assurance

The Account Party undertakes to do or to procure all such acts and things and to sign,
execute and deliver or procure the signing, execution and delivery of all such instruments
and documents as the Agent may reasonably require for the purpose of perfecting any such
permitted assignment, transfer, sub-participation, change or delegation as aforesaid.

	26.14	 	Register

The Agent shall keep a register of all the Banks for the time being with details of their
respective Commitments and lending offices and shall provide any other party to this
Agreement (at that party’s expense) with a copy of the register on request.

	27.	 	SET-OFF

	27.1	 	Set-off

The Account Party authorises each Creditor Party without prejudice to any of that Creditor
Party’s rights at law in equity or otherwise, at any time and without notice to the Account
Party:

	 	27.1.1	 	to combine and/or consolidate all or any accounts (whether current, deposit, loan or
of any other nature whatsoever, whether subject to notice or not and in whatever
currency) of the Account Party with any branch of that Creditor Party;

	 	27.1.2	 	to apply any credit balance (whether or not then due) on any such account or accounts
of the Account Party in or towards satisfaction of any sum due and payable by the
Account Party but not paid to that Creditor Party under this Agreement and/or any of
the Finance Documents; and

	 	27.1.3	 	to do in the name of the Account Party and/or that Creditor Party all such acts and
execute all such documents as may be necessary or expedient to effect such application.

	27.2	 	Purchase of other currencies

For all or any of the above purposes, each Creditor Party is authorised to purchase with the
moneys standing to the credit of such account or accounts any such other currency or
currencies as may be necessary to effect such application. A Creditor Party shall not be
obliged to exercise any right given to it by this Clause 27.

	28.	 	MISCELLANEOUS

	28.1	 	Time of essence

Time is of the essence as regards every obligation of the Account Party and the other
Obligors under this Agreement and the other Finance Documents, but no delay or omission by
any Creditor Party to exercise any right, power or remedy vested in it under this Agreement
or any other of the Finance Documents or by law shall impair such right, power or remedy, or
be construed as a waiver of, or as an acquiescence in, any default by the Account Party or
any other Obligor.

	28.2	 	No waiver

If any Creditor Party on any occasion agrees to waive any such right, power or remedy, such
waiver shall not in any way preclude or impair any further exercise thereof or the exercise
of any other right, power or remedy.

	28.3	 	Waivers to be in writing

Any waiver by any Creditor Party of any provision of this Agreement or any other of the
Finance Documents, and any consent or approval given by any Creditor Party, shall only be
effective if given in writing and then only strictly for the purpose and upon the terms for
which it is given.

	28.4	 	Amendments to be in writing

Neither this Agreement nor any of the other Finance Documents may be amended or varied
orally but only by an instrument signed by the applicable Majority Banks or all the Banks
(as may be applicable) or, as the case may be, the Agent and/or the Security Trustee on
behalf of the applicable Majority Banks or all the Banks (as may be applicable), and each of
the other parties thereto.

	28.5	 	Remedies cumulative

The rights, powers and remedies of the Creditor Parties contained in this Agreement and the
other Finance Documents are cumulative and not exclusive of each other nor of any other
rights, powers or remedies conferred by law, and may be exercised from time to time and as
often as the Creditor Parties may think fit.

	28.6	 	Severability

If at any time one or more of the provisions of this Agreement or any other of the Finance
Documents is or becomes invalid, illegal or unenforceable in any respect under any law by
which it may be governed or affected, the validity, legality and enforceability of the
remaining provisions shall not be in any way affected or impaired as a result.

	28.7	 	Counterparts

This Agreement may be executed in any number of counterparts and all such counterparts taken
together shall be deemed to constitute but one and the same instrument.

	28.8	 	Conclusiveness of Creditor Party’s certificates

The certificate or determination of a Creditor Party of a rate or amount under this
Agreement and any other Finance Document is, in the absence of manifest error, prima facie
evidence of the matters to which it relates and is binding on the Account Party and the
other Obligors.

	28.9	 	Previous offers by the Creditor Parties superseded

This Agreement shall in all respects supersede the terms of any offer or commitment with
respect to the Facility made by or on behalf of the Creditor Parties to the Account Party or
its agents prior to the date of this Agreement (save for any provision relating to payment
of the Creditor Parties’ fees and expenses).

	29.	 	FURTHER ASSURANCE

The Account Party shall, upon demand, and at its own expense, sign, perfect, do, execute and
register all such further assurances, documents, acts and things as the Agent may reasonably
require for the purpose of more effectually accomplishing or perfecting the transaction or
security contemplated by this Agreement.

	30.	 	NOTICES

	30.1	 	Addresses

All notices (which expression includes any demand, request, consent or other communication)
to be given by one party to the others under this Agreement and the other Finance Documents
shall be in writing and (unless delivered personally) shall be given by telefax or first
class pre paid post (airmail if sent internationally) and be addressed:

	 	 	 	 	 
	 	30.1.1	 	 	in the case of the Agent, as follows:

	 	 	 	 	60 London Wall

London EC2M 5TQ

	 	 	 	 	Telefax No: + 44 207 767 7507

Attn: Nick Marchant / Paul Meade

	 	30.1.2	 	 	in the case of the Issuing Bank, as follows:

	 	 	 	 	60 London Wall

London EC2M 5TQ

	 	 	 	 	Telefax No: + 44 207 767 7531

Attn: Nigel Burman

	 	30.1.3	 	 	in the case of the Security Trustee, as follows:

	 	 	 	 	60 London Wall

London EC2M 5TQ

	 	 	 	 	Telefax No:+ 44 207 767 7507

Attn: Nick Marchant / Paul Meade

	30.1.4

30.1.5
	 	in the case of a Bank at the address set out beneath its name in Schedule 1; and

in the case of the Account Party and Applicant, as follows:

	 	 	 	 	70 Gracechurch Street

London

EC3V 0XL

	 	 	 
	Telefax No:

Attn:

	 	+44 20 3102 3120

Chief Financial Officer

	 	 	 	 	 	 	 
	 	 	 	 	with a copy to the Guarantor at its address specified below;

	 	 	 	 	30.1.6in the case of the Guarantor, as follows:

	 	 	 	 	Alterra House

2 Front Street

Hamilton, Bermuda HM11

	 	

	 	 	 	 	Telefax No:

Attn:

	 	+1 441 295 8899

Chief Financial Officer
	 	30.2	 	 	Changes of address

	 	

If any party wishes to change its address for communication, it shall give the other parties
not less than 5 Banking Days’ notice in writing of the change desired.

	30.3	 	Deemed receipt of notices

Notices addressed as provided above shall be deemed to have been duly given when despatched
(in the case of telefax), when delivered (in the case of personal delivery), 2 days after
posting (in the case of letters sent within the same country), or 5 days after posting (in
the case of letters sent internationally by overnight courier service only), provided that
notices to the Agent or the Security Trustee shall be effective only upon their actual
receipt by the Agent or the Security Trustee (as appropriate). In each of the above cases
any notice received on a non-working day or after business hours in the country of receipt
shall be deemed to be given on the next following working day in such country.

	30.4	 	English language

All notices and documents to be given or delivered pursuant to or otherwise in relation to
this Agreement and the other Finance Documents shall be in the English language or be
accompanied by a certified English translation.

	31.	 	APPLICABLE LAW AND JURISDICTION

	31.1	 	Governing law

This Agreement and any non-contractual obligations arising out of or in connection with it
shall be governed by and construed in accordance with English law.

	31.2	 	Submission to jurisdiction

Each of the Account Party, the Applicant and the Guarantor hereby irrevocably agrees for the
exclusive benefit of the Banks that the English courts shall have jurisdiction in relation
to any dispute (including any dispute in connection with any non-contractual obligations
arising out of or in connection with this Agreement) and any suit, action or proceeding
(referred to together in this Clause 31 as “Proceedings”) which may arise out of or in
connection with this Agreement and/or any of the other Finance Documents (including any
non-contractual obligations related thereto), and for such purposes irrevocably submits to
the jurisdiction of such courts

	31.3	 	Service of process

The Guarantor hereby irrevocably agrees:

	 	31.3.1	 	that, for the purpose of Proceedings in England, any legal process may be served upon
the Account Party at the address to which notices are to be delivered under Clause 30,
which is hereby authorised to accept service on behalf of the Guarantor, which shall be
deemed to be good service on the Guarantor; and

	 	31.3.2	 	that throughout the Security Period it will maintain a duly appointed process agent
in England, duly notified to the Agent, and that failure by any such process agent to
give notice thereof to it shall not impair the validity of such service or of a
judgment or order based thereon.

	31.4	 	Choice of forum

Nothing in this Clause 31 shall affect the right of any Bank to serve process in any manner
permitted by law or limit the right of any Bank to take Proceedings against the Account
Party, the Applicant or the Guarantor in any other court of competent jurisdiction, nor
shall the taking of Proceedings in one or more jurisdictions preclude the taking of
Proceedings by any Bank in any other jurisdiction, whether concurrently or not.

Neither the Account Party, the Applicant nor the Guarantor shall commence any Proceedings in
any country other than England in relation to any matter arising out of or in connection
with this Agreement and/or any of the other Finance Documents.

	31.5	 	Forum convenience

Each of the Account Party, the Applicant and the Guarantor irrevocably waives any objection
which it may now or hereafter have on the grounds of inconvenient forum or otherwise to
Proceedings being brought in any such court as is referred to in this Clause 31.

	31.6	 	Consent

Each of the Account Party, the Applicant and the Guarantor consents generally in respect of
any Proceedings arising out of or in connection with this Agreement to the giving of any
relief or the issue of any process in connection with such Proceedings, including without
limitation, the making, enforcement or execution against any property or assets whatsoever
of any order or judgment which may be made or given in such Proceedings.

	31.7	 	Waiver of immunity

To the extent that the Account Party, the Applicant or the Guarantor may be entitled in any
jurisdiction to claim for itself or its property or assets immunity in respect of their
respective obligations under this Agreement from service of process, jurisdiction, suit,
judgment, execution, attachment (whether before judgment, in aid of execution or otherwise)
or legal process, or to the extent that in any such jurisdiction there may be attributed to
it or its property or assets such immunity (whether or not claimed), the Account Party, the
Applicant and the Guarantor irrevocably each agree not to claim and irrevocably waive such
immunity to the fullest extent permitted by the laws of such jurisdiction.

AS WITNESS the hands of the duly authorised representatives of the parties hereto the day and year
first before written.

SCHEDULE 1

4

BANKS AND COMMITMENTS

	 	 	 	 	 	 	 
	Bank	 	Lending Office	 	Commitment
	 	 	 	 	£
	
 
	 	 	 	 	60,000,000	 
	ING Bank N.V., London Branch

	 	60 London Wall, London EC2M 5TQ
	 	

	
 
	 	 	 	 	60,000,000	 
	
 
	 	 	 	 	 	 

INITIAL CORPORATE MEMBERS

Alterra Corporate Capital 2 Limited

Alterra Corporate Capital 3 Limited

SCHEDULE 2

5

CONDITIONS PRECEDENT DOCUMENTS AND EVIDENCE

The documents and evidence referred to in Clause 10.1.3 are as follows:

	1.	 	Certified copies of the memorandum and articles of incorporation or equivalent constitutional
documents of each Obligor.

	2.	 	A certificate of good standing for each Obligor (other than any Obligor whose jurisdiction of
incorporation is England and Wales) or other evidence that each such Obligor is in good
standing in its country of incorporation.

	3.	 	A certificate of incumbency of each Obligor, signed by the secretary or a director of that
Obligor stating its officers and directors.

	4.	 	Certified copies of resolutions duly passed by the directors of each Obligor and, if
appropriate and requested by the Agent, the shareholders of each Obligor (other than the
Guarantor) at separate meetings evidencing approval of the transactions contemplated by this
Agreement and the other Finance Documents and authorising the execution of the same.

	5.	 	The original or a certified copy of any power of attorney issued by each Obligor in favour of
any person or persons executing this Agreement and the other Finance Documents.

	6.	 	Certified copies of all licences, authorisations, approvals and consents required in
connection with the execution, delivery, performance, validity and enforceability of the
Finance Documents.

	7.	 	A certificate of an authorised signatory of the Account Party confirming that utilising the
Total Commitments in full would not breach any limit binding on the Account Party.

	8.	 	Certified copies of all Quota Share Agreements that have then been executed.

	9.	 	Certified copies of the audited consolidated financial statements for the financial year
ending on 31 December 2007 for Alterra Holdings and such financial information as to each
other Obligor as the Agent shall reasonably request.

	10.	 	The Finance Documents referred to in Clause 11.1 and, if then required, Clause 11.2 and all
documents, instruments, notices and acknowledgements thereto required under those Finance
Documents duly executed by the relevant Obligors.

	11.	 	Evidence that the Deposit Account has been duly opened by the Account Party and that all
board resolutions, mandates, signature cards and other documents or evidence required in
connection with the opening, maintenance and operation of that account have been duly
delivered to the Agent.

	12.	 	Such certificates and documents as each Bank may require to comply with the money laundering
prevention procedures then applicable to it.

	13.	 	Evidence that the agent of the Guarantors has accepted its appointment for service of process
in England.

	14.	 	Favourable opinions from the Agent’s legal advisers with respect to each Obligor, and the
overall transaction contemplated by this Agreement, in such terms as the Agent may require.

	15.	 	A copy of each Lloyd’s Security and Trust Deed, duly executed by the Account Party or a
Corporate Member.

	16.	 	Evidence that all fees and expenses then due and payable from the Account Party under this
Agreement or the Fee Letter have been paid.

SCHEDULE 3

6

FORM OF TRANSFER CERTIFICATE

TRANSFER CERTIFICATE

Banks are advised not to employ Transfer Certificates or otherwise to assign or transfer interests
in the Agreement without first ensuring that the transaction complies with all applicable laws and
regulations, including the Financial Services and Markets Act 2000 and regulations made thereunder
and similar statutes which may be in force in other jurisdictions.

	 	 	 
	To:
	 	ING Bank N.V., London Branch as agent on its own behalf and for

and on behalf of the Account Party and Banks defined in the

Agreement referred to below:

	Attention:
	 	Nick Marchant / Paul Meade

	1.	 	This Transfer Certificate relates to a facility agreement (the “Facility Agreement”) dated 13
October 2008 (as amended and restated on 30 March 2010, as amended on 26 November 2010 and as
further amended and restated on 16 December 2010) and made between (1) Alterra Capital UK
Limited as Account Party (the “Account Party”) and Applicant, (2) Alterra Capital Holdings
Limited as Guarantor, (3) the banks and financial institutions defined therein as banks (the
“Banks”), (4) ING Bank N.V., London Branch as Agent, (5) ING Bank N.V., London Branch as
Issuing Bank and (6) ING Bank N.V., London Branch as Security Trustee (as the same may from
time to time be amended or varied).

	2.	 	Terms defined in the Facility Agreement shall, unless otherwise defined herein, have the same
meanings when used in this Transfer Certificate.

	3.	 	In this Certificate:

"Relevant Party” means each Obligor and each Creditor Party;

"Transferor Bank” means [full name] of [lending office]; and

"Transferee Bank” means [full name] of [lending office].

	4.	 	The Transferor Bank as beneficial owner hereby transfers to the Transferee Bank absolutely in
accordance with Clause [?] of the Facility Agreement all its rights and benefit (present,
future or contingent) under the Facility Agreement and the other Finance Documents to the
extent of [?] per cent. ([?]%) of the Transferor Bank’s Contribution outstanding, details of
which are set out below:

	 	 	 	 	 
	Transferor Bank's Contribution	 	Amount to be Transferred

	5.	 	By virtue of this Transfer Certificate and Clause [?] of the Facility Agreement the
Transferor Bank is discharged [entirely from its Commitment][from [?] per cent. of its
Commitment].

	6.	 	The Transferee Bank hereby requests the Agent and the Banks to accept the executed copies of
this Transfer Certificate as being delivered pursuant to and for the purposes of Clause [?] of
the Facility Agreement so as to take effect in accordance with the terms thereof on [?].

	7.	 	The Transferee Bank:

	 	7.1	 	confirms that it has received copies of the Facility Agreement and the other
Finance Documents together with such other documents and information as it has required
in connection with the transaction contemplated thereby;

	 	7.2	 	confirms that it has not relied and will not hereafter rely on the Transferor
Bank, any other Bank, the Issuing Bank, the Agent or the Security Trustee to check or
enquire on its behalf into the legality, validity, effectiveness, adequacy, accuracy or
completeness of the Facility Agreement, any of the other Finance Documents or any such
other documents or information;

	 	7.3	 	agrees that it has not relied and will not rely on the Transferor Bank, any
other Bank, the Issuing Bank, the Agent or the Security Trustee to assess or keep under
review on its behalf the financial condition, creditworthiness, condition, affairs,
status or nature of the Account Party or any other party to the Facility Agreement or
any of the other Finance Documents (save as otherwise expressly provided therein);

	 	7.4	 	warrants to the Transferee Bank and each Relevant Party that it has power and
authority to become a party to the Facility Agreement and has taken all necessary
action to authorise execution of this Transfer Certificate and to obtain all necessary
approvals and consents to the assumption of its obligations under the Facility
Agreement and the other Finance Documents;

	 	7.5	 	if not already a Bank, appoints the Agent to act as its agent as provided in
the Facility Agreement and the other Finance Documents and agrees to be bound by the
terms thereof; and

	 	7.6	 	confirms the accuracy of the administrative details set out in the Schedule to
this Transfer Certificate.

	8.	 	The Transferor Bank:

	 	8.1	 	warrants to the Transferee Bank and each Relevant Party that it has full power
to enter into this Transfer Certificate and has taken all corporate action necessary to
authorise it to do so; and

	 	8.2	 	undertakes with the Transferee Bank that it will, at its own expense, execute
any documents which the Transferee Bank reasonably requests for perfecting in any
relevant jurisdiction the Transferee Bank’s title under this Transfer Certificate or
for a similar purpose.

	9.	 	The Transferee Bank hereby undertakes with the Transferor Bank and each Relevant Party that
it will perform all those obligations which by the terms of the Facility Agreement will be
assumed by it after this Transfer Certificate takes effect.

	10.	 	None of the Transferor Bank, any other Bank, the Issuing Bank, the Agent or the Security
Trustee:

	 	10.1	 	makes any representation or warranty nor assumes any responsibility with
respect to the legality, validity, effectiveness, adequacy or enforceability of the
Facility Agreement or any of the other Finance Documents or any other document
relating thereto;

	 	10.2	 	assumes any responsibility for the financial condition of the Account Party or
any other party to the Facility Agreement or any of the other Finance Documents or any
other document relating thereto or for the performance and observance thereof by the
Account Party or any such other party (save as otherwise expressly provided therein)
and any and all such conditions and warranties, whether expressed or implied by law or
otherwise, are hereby excluded (except as aforesaid).

	11.	 	The Transferor Bank and the Transferee Bank undertake that they will on demand fully
indemnify the Agent and the Security Trustee in respect of any claim, proceeding, liability or
expense which relates to or results from this Transfer Certificate or any matter connected
with or arising out of it unless caused by the Agent’s or Security Trustee’s gross negligence
or wilful misconduct, as the case may be.

	12.	 	The agreements and undertaking of the Transferee Bank in this Transfer Certificate are given
to and for the benefit of and made with each of the Relevant Parties.

	13.	 	This Transfer Certificate shall be governed by, and construed in accordance with, English
law.

	 	 	 
	Transferor Bank
	By:

Dated:

	 	[?]

[?]

	 	 	 
	Transferee Bank
	By:

Dated:

	 	[?]

[?]

	 	 	 
	 	 	Agent (for and on behalf of itself and for every other Relevant Party)

	 	 	 

	 	 	By: [?]

Dated: [?]

	Note:
	 	The execution of this Transfer Certificate alone may not transfer a

proportionate share of the Transferor Bank’s interest in the security

constituted by the Finance Documents in the Transferor Bank’s or

Transferee Bank’s jurisdiction. It is the responsibility of each

individual Bank to ascertain whether any other documents are required

to perfect a transfer of such a share in the Transferor Bank’s interest

in such security in any such jurisdiction, and, if so, to seek

appropriate advice and arrange for execution of the same.

SCHEDULE 4

7

FORM OF APPLICATION

	 	 	 
	To:

From:

Date:

	 	ING Bank N.V., London Branch as Issuing Bank

[?]

[?]

£60,000,000 Credit Agreement dated 13 October 2008 (as amended and restated, the “Agreement”)

	1.	 	We refer to the Agreement. This is an Application. This Application is irrevocable.

	2.	 	We wish to arrange for a Letter of Credit to be issued under the Facility on the following
terms:

	 	 	 
	Issuance Date:

Amount/currency:

Beneficiary:

Term:

	 	[?]

[?]

The Society and Council of Lloyd’s

[?]

	3.	 	[The Letter of Credit is to be issued by way of an amendment to the existing Letter of Credit
for $[?] (reference number [?]).]

	4.	 	Our delivery instructions are: [?]

	5.	 	We confirm that each condition precedent under the Agreement which must be satisfied on the
date of this Application is so satisfied.

	6.	 	We attach a copy of the proposed Letter of Credit.

	 	 	 
	By:	 	_____________________________________
	 	 	[ALTERRA CAPITAL UK LIMITED]

SCHEDULE 5

8

INVESTMENT COLLATERAL

	 	 	 	 	 	 	 	 	 
	Collateral Description	 	Advance Rate
	 	 	 
	
 
	 	Matching Currency
	 	Non-Matching

Currency

	
 
	 	 	 	 	 	 	 	 
	Cash:

	 	 	100	%	 	 	90	%
	 

	 	

	 	

	Cash held in a Charged Account

	 	

	 	

	 

	 	

	 	

	US Dollar and/or Sterling time Deposits, CDs and Money

Market Deposits:

	 	

	 	

	 

	 	

	 	

	Time deposits, certificates of deposit and money

market deposits of any OECD incorporated bank with a

rating of at least (i) AA- from S&P and (ii) Aa3 from

Moody’s and maturing within two years from the date of

determination held in a Charged Account.

	 	

95%
	 	

85%

	 

	 	 	 	 	 	 	 	 
	US and/or UK Government Securities:

	 	

	 	

	 

	 	

	 	

	Securities held in a Charged Account issued or

directly and fully guaranteed or insured by the United

States Government or any agency or instrumentality

thereof (provided that the full faith and credit of

the United States is pledged in support thereof), or

UK Gilts, with maturities of:

	 	

	 	

	- less than five years from the date of determination

	 	 	90	%	 	 	80	%
	- more than five years from the date of determination

	 	 	85	%	 	 	75	%
	 

	 	 	 	 	 	 	 	 
	US Dollar and/or Sterling Investment Grade

Non-Convertible Corporate Bonds:

	 	

	 	

	 

	 	

	 	

	Non-convertible corporate bonds held in a Charged

Account which are publicly traded on a nationally

recognised exchange, eligible to be settled by the

Depository Trust Company and rated at least A from S&P

and A2 from Moody’s (subject to those bonds not

exceeding 15% of the total collateral pool)

	 	

80%
	 	

70%

	 

	 	 	 	 	 	 	 	 

9

SCHEDULE 6

FORM OF COMPLIANCE CERTIFICATE

	 	 	 	 	 
	To:	 	ING Bank N.V., London Branch as Agent
	From:

Date :

Reference Date:

	 	[?] (the “Company”)

[?]
	 	

[?]

Dear Sirs

£60,000,000 Credit Agreement dated 13 October 2008 (as amended and restated, the “Agreement”)

	1.	 	We refer to the Agreement. This is a Compliance Certificate (the “Certificate”).

	2.	 	Terms defined in the Agreement have the same meanings in this Certificate.

	3.	 	The position as at the Reference Date with respect to the financial covenant in Clause 14.2
of the Agreement is as set out in Schedule A and the position as at the Reference Date with
respect to the financial covenant in Clause 14.3 of the Agreement is as set out in Schedule B.

	4.	 	As at the date of this Certificate: (a) the total FAL requirement of Alterra Corporate 2 is
£[?] and Alterra Corporate 2 has Primary FAL of £[?] (representing [?]%); and (b) the total
FAL requirement of Alterra Corporate 3 is £[?] and the Primary FAL of Alterra Corporate 3 is
£[?] (representing [?]%). Accordingly, Alterra Holdings is in compliance with the covenant in
Clause 14.4 of the Agreement.

	5.	 	As at the date of this Certificate, the Company is in compliance with its obligations under
the Finance Documents and no Event of Default has occurred or, if any has occurred, none is
continuing.

	6.	 	The Managing Agent has not made any change in its standards for managing underwriting risk
which is likely to have a material adverse effect on the ability of the Account Party to
perform any of its obligations under the Agreement or the Finance Documents.

	7.	 	The Managing Agent has adhered in all material respects to Lloyd’s requirements with regard
to the investment of syndicate funds.

By:

     

[Chief Financial Officer / Chief Executive Officer]

[Company]

10

Schedule A

[Company]

Calculations of the financial covenant in Clause 14.2 as at [?]

	 	 	US GAAP Net Worth of Alterra Bermuda as at [?] based on:

	 	 	 
	70% of the US GAAP Net Worth of Alterra Bermuda as at 30.09.10,

plus

	 	$[?]

	50% of Consolidated Net Income, plus

	 	$[?]
	50% of the aggregate increases in equity

	 	$[?]

     
	US GAAP Net Worth of Alterra Bermuda

	 	$[?]

11

Schedule B

[Company]

Calculations of the financial covenant in Clause 14.3 as at [?]

	 	 	Calculation of Total Debt to Total Capitalization Ratio as at [?] based on:

	 	 	 	 	 	 	 	 	 
	(a)
	 	Total Debt

	 	$[?]
	 	

	 	

	(b)
	 	US GAAP Net Worth of Alterra Holdings

	 	$[?]
	 	

	 	

	 	 	Total Debt plus US GAAP Net Worth of Alterra

Holdings (a + b)

	 	$[?]

	 	

	 	

	 	 	Total Debt to Total Capitalization Ratio (a)

to (a + b)

	 	$[?] to $[?]

	 	=

	 	[?]%

SCHEDULE 7

12

FORM OF BORROWING BASE CERTIFICATE

[LETTERHEAD OF THE ACCOUNT PARTY]

To be provided to the addressee by no later than the 10 day of each month in respect of the
Investment Collateral of the Company as of the last day of the immediately preceding month.

	 	 	 
	To:

	 	ING Bank N.V., London Branch
	From:

	 	[?] (the “Company”)

This Borrowing Base Certificate (the “Certificate”) is delivered pursuant to the reporting
requirements of Clause 14 (Financial and other information) of the Letter of Credit Facility
Agreement dated 13 October 2008 (as amended and restated on 30 March 2010, as amended on 26
November 2010 and as further amended and restated on [?] December 2010) between, among others,
Alterra Capital UK Limited and ING Bank N.V., London Branch as the facility agent (the “Letter of
Credit Facility Agreement”). Terms used in this Certificate shall have the meaning provided in the
Letter of Credit Facility Agreement unless otherwise defined herein.

The Company represents and warrants that the following calculations determine its Investment
Collateral in accordance with the relevant definitions as set forth in the Letter of Credit
Facility Agreement and hereby certifies as follows:

	1.	 	The borrowing base as of [insert date] comprises the following:

	 	 	 	 	 	 	 	 	 
	Investment	 	Rating of	 	Current Market	 	Applicable Advance	 	Valuation for
	Collateral held in	 	Investment	 	Valuation	 	Rate	 	Collateral Purposes
	a Collateral	 	Collateral	 	 	 	 	 	 
	Account	 	 	 	 	 	 	 	 
	Totals

	 	

	 	

	 	

	 	

	 

	 	

	 	

	 	

	 	

	2.	 	The aggregate amount of Investment Collateral held in the Collateral Account and/or the
Deposit Account of the Company on that date is [?].

	3.	 	The aggregate valuation of the Investment Collateral on that date after application of the
applicable advance rate is [?].

The Company hereby further represents and warrants that the Collateral Account of the Company with
[?] as Approved Custodian is being maintained in compliance with the provisions of, and subject to
the first priority perfected Security Interests in favour of the Agent required by, the Finance
Documents.

This Certificate is executed on [?] by a duly Authorised Officer of the Company.

Date:       

	 	 	 
	By:
	 	     

Name:

	 	 	Title: [Authorised Officer]

	By:
	 	     

Name:

	 	 	Title: [Authorised Officer]

SCHEDULE 8

13

ACCESSION LETTER

	 	 	 	 	 
	To:	 	ING Bank N.V., London Branch

	 	 	From:

	 	[?]
	 	 	Dated:

	 	[?]

Dear Sirs

£60,000,000 Credit Agreement dated 13 October 2008 (as amended and restated, the “Agreement”)

We refer to the Agreement. This is an Accession Letter. Terms defined in the Agreement have the
same meaning in this Accession Letter unless given a different meaning.

[Subsidiary] agrees to become an additional Account Party and to be bound by the terms of the
Agreement as an additional Account Party pursuant to Clause 3.10 (Additional Account Party) of the
Agreement. [Subsidiary] is a company duly incorporated under the laws of [name of relevant
jurisdiction].

	 	 	 	 	 
	[Subsidiary’s] administrative details are as follows:

	Address:

	 	[?]
	 	

	Fax No:

	 	 	 	[?]
	Attention:

	 	[?]
	 	

This Accession Letter is governed by English law. This Accession Letter is entered into by deed.

	 	 	 
	SIGNED for and on behalf of

[?]

by

its duly appointed

in the presence of:

	 	)

)

)

)

)

)

SCHEDULE 9

14

FORM OF COMFORT LETTER

[LETTERHEAD OF LLOYD’S]

	 	 	 
	ING Bank NV, London Branch

	60 London Wall

London EC2M 5TQ

Date:

	 	

[?] 201[?]

Dear Sir/Madam

I understand that Alterra Capital UK Limited on behalf of itself and Alterra Corporate Capital 2
Limited and Alterra Corporate Capital 3 Limited (the “Corporate Members”) has procured or may
procure the provision by you to Lloyd’s of one or more letters of credit to form part of their
Funds at Lloyd’s (the “ING L/Cs”).

You have asked whether, in the event of monies having to be applied out of the Corporate Members’
Funds at Lloyd’s, the letters of credit and other Funds at Lloyd’s of the Corporate Members may be
drawn down in a pre-determined order whereby any drawdown on the ING L/Cs would not be made until
such time as all other of the Corporate Members’ Funds at Lloyd’s had been applied.

As you are aware, the letters of credit are held by Lloyd’s in its capacity as Security Trustee
under the terms of the Security and Trust Deed (substantially in the form STD (CM) G93 CM 123)
entered into by the Corporate Members. Any decision to draw down on any letter of credit involves
an exercise of discretion in the light of the circumstances prevailing at the relevant time, and
thus no binding undertaking can be given now.

However, I can confirm that at the time of considering the drawdown of the Corporate Members’ Funds
at Lloyd’s, Lloyd’s would take into account the requested order of drawdown set out in the second
paragraph of this letter.

For the avoidance of doubt, Lloyd’s shall not be responsible to you or any other person for any
losses incurred by you or such other person as a consequence of acting in reliance upon this
letter.

Yours faithfully

SCHEDULE 10

15

FORM OF MANAGING AGENT’S UNDERTAKING

	 	 	 
	ALTERRA AT LLOYD’S LIMITED
	ING BANK N.V., LONDON BRANCH
	 	 	DEED OF UNDERTAKING

	 	 	 

16

THIS DEED is made on [?] December 2010

BY:

	(1)	 	ALTERRA AT LLOYD’S LIMITED, a company incorporated in England and Wales (registered no.
3304600), whose registered office is at 70 Gracechurch Street, London EC3V 0XL (the “Company”)

	 	 	IN FAVOUR OF:

	(2)	 	ING BANK N.V., LONDON BRANCH (the “Agent”) as agent for and on behalf of the Creditor
Parties.

	 	 	INTRODUCTION

	(A)	 	The Company is the managing agent of Syndicates 1400, 2525 and 2526 at Lloyd’s (the
“Syndicates”).

	(B)	 	Alterra Corporate Capital 2 Limited and Alterra Corporate Capital 3 Limited (the “Corporate
Names”) are participants in the Syndicates.

	(C)	 	Pursuant to a letter of credit facility agreement dated 13 October 2008 (as amended and
restated on 30 March 2010, as amended by a supplemental letter dated 26 November 2010 and as
further amended and restated by an amending and restating agreement dated [?] December 2010)
made between (1) Alterra Corporate Capital Limited as account party and applicant (the
“Applicant”), (2) Alterra Capital Holdings Limited as guarantor, (3) the banks and financial
institutions listed in schedule 1 therein as banks (the “Banks”), (4) the Agent as agent, (5)
the Agent as issuing bank and (6) the Agent as security trustee (the “Facility Agreement”),
the Banks have agreed to make a letter of credit facility available to provide FAL at the
request of the Applicant to support the underwriting capacity of the Corporate Names in
relation to the Syndicates.

	(D)	 	Under the terms of the Facility Agreement the Applicant is required to procure that the
Company provide this deed of undertaking in favour of the Agent.

THIS DEED PROVIDES THAT:

	1.	 	Terms defined in the Facility Agreement have the same meaning in this Deed unless given a
different meaning.

	2.	 	In consideration of the Creditor Parties entering into the Facility Agreement, the Company
hereby undertakes that in the event that Lloyd’s seeks any application of the FAL in relation
to a Corporate Name it will (a) use reasonable endeavours to draw Lloyd’s attention to the
comfort letter referred to in clause 14.4.3(b) of the Credit Facility Agreement and (b) will
request that Lloyd’s apply the FAL of that Corporate Member in the following order:

(a) first, the Primary FAL until exhausted; and

(b) second, any Letter of Credit.

	3.	 	This Deed and any non-contractual obligations arising out of or in connection with it is
governed by and shall be construed in accordance with English law.

	4.	 	The courts of England and Wales shall have exclusive jurisdiction to hear and determine any
suit, action or proceeding which may arise out of or in connection with this Deed.

	5.	 	This Deed is intended to be and is hereby delivered by the Company as a deed on the date
specified above.

Executed as a deed by

ALTERRA AT LLOYD’S LIMITED

	 	 	 
	     

     

     

     

     
	 	Signature of director

Name of director

Signature of witness

Name of witness

Address of witness

17

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