Document:

ex99-1.htm

                                                                                         EXHIBIT
      10.1

    

    AGREEMENT
      FOR DEPOSIT TRANSFER AND ASSUMPTION,

    PURCHASE
      AND SALE OF ASSETS AND ASSIGNMENT

    AND
      ASSUMPTION OF LEASE

    

    

    This
      AGREEMENT is made as of this 13th day of November, 2007, by and between Savings
      Institute Bank and Trust Company, a federally chartered stock savings bank
      having its principal office in Willimantic, Connecticut (the "Purchaser"),
      and
      The Bank of Southern Connecticut, a Connecticut state chartered bank and trust
      company having its main office in New Haven, Connecticut (the
      "Seller");

    

    WHEREAS,
      the Seller desires, upon the terms and conditions set forth herein, to (i)
      divest the deposit liabilities of its branch office at 15 Masonic Street, New
      London, Connecticut (the "Branch"), (ii) sell the Loans described in Section
      1.4, (iii) sell the Assets described in Section 2.1 and (iv) consummate the
      other transactions contemplated hereby (collectively, the "Transactions");
      and

    

    WHEREAS,
      the Purchaser desires to assume such deposit liabilities of the Branch, to
      purchase the Loans and the Assets as more specifically set forth herein and
      to
      consummate the Transactions;

    

    NOW,
      THEREFORE, in consideration of the commitments and covenants contained herein,
      and for other good and valuable consideration, the receipt and sufficiency
      of
      which are hereby mutually acknowledged, the Seller and the Purchaser (each,
      a
      "Party" and collectively, the "Parties") agree and covenant as
      follows:

    

    

    ARTICLE
      I

    ASSUMPTION
      OF LIABILITIES

    

    1.1           Time
      and Place of Closing.

    

    (a)           The
      closing of the transactions contemplated hereby (the "Closing") shall occur
      on a
      Friday at 5:00 p.m. on a date mutually agreeable to the Parties following
      receipt of all Government Approvals (as defined in Section 1.9), the expiration
      of all legally mandated waiting periods, the receipt of all other required
      consents and the satisfaction of all of the closing conditions (the "Closing
      Date");

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (b)           The
      Closing shall be at the offices of the Purchaser or at such other place as
      the
      Seller and the Purchaser may mutually agree.

    

    1.2           Transfers
      and Consideration.

    

    (a)           The
      Purchaser agrees that on and after the Closing Date, subject to the terms and
      conditions of this Agreement, it will assume the following Deposit Liabilities
      (as defined below):

    

    (i)           Assumption
      of Deposits. On the Closing Date, subject to the terms and conditions set forth
      in this Agreement, the Purchaser will assume the aggregate outstanding balance
      of all deposit accounts attributed on the records of the Seller to the Branch,
      including, without limitation, all savings, checking, transaction, negotiable
      order of withdrawal and certificate accounts, plus accrued interest payable
      on
      such accounts as of the Closing Date as reflected on the records of the Seller,
      but shall not include: (a) deposits which are held by the Seller pursuant to
      or
      under any judgment, decree or order of any court, are subject to any legal
      restraint or legal process, or are subject to any lien, claim, charge or
      encumbrance; (b) deposits which, in the calendar year in which the Closing
      occurs, become subject to escheat to any government authority pursuant to
      applicable escheat and unclaimed property laws; (c) any deposit under a trust
      or
      custodial arrangement qualified as an individual retirement account within
      the
      meaning of section 408 of the Internal Revenue Code of 1986, as amended (the
      "Code"), (d) accounts maintained by a customer solely or principally to
      facilitate the sending of funds remittances outside the United States, and
      (e)
      deposits that, in the sole discretion of the Seller, are essential to
      maintaining relationships with customers that have accounts or loans domiciled
      at any of the Seller's other offices (collectively, the "Deposit Liabilities").
      (A list of such Deposit Liabilities as of November 5, 2007 is attached hereto
      as
      Schedule 1.2.)  Such schedule shall be updated as of the Closing
      Date.

    

    (ii)           Except
      as expressly set forth in Section 1.2(a)(i), the Purchaser will not assume
      any
      other Deposit Liabilities of the Seller arising prior to the Closing Date,
      and
      the Purchaser will not assume any other Deposit Liabilities whatsoever of the
      Seller arising on and after the Closing Date.

    

    1.3           Payment.

    

    (a)           The
      amount to be paid by the Seller to the Purchaser in consideration of the
      assumption by the Purchaser of the Deposit Liabilities (the "Deposit Transfer
      Amount") shall equal the outstanding balances and accrued interest on the
      Deposit Liabilities ("Closing Balances") as of the close of business on the
      Closing Date reduced by (i) the amount of any overdrafts described in Sections
      1.4 and 1.10 and (ii) an amount determined by multiplying the Closing Balances
      ((i) and (ii) collectively, the "Adjustments") less (x) any and all deposits
      identified in Schedule 1.3 and 1.3(a) annexed hereto by TWELVE PERCENT (12%)
      and
      (y) the deposits identified in Schedule 1.3 by SIX PERCENT (6%) (e.g. if the
      deposits identified in Schedule 1.3 Closing Balances are $3,500,000 and the
      all
      other deposit Closing Balances are $10,000,000, the (x) and (y) reduction amount
      would be $1,200,000 plus $210,000, or $1,410,000) (collectively, the "Deposit
      Premium").

    

    (b)           Because
      the final Deposit Transfer Amount will not be determinable until after the
      Closing Date, the Seller shall pay the Purchaser by wire transfer of immediately
      available U.S. funds and the Seller shall effect the wire transfer by 2:00
      p.m.
      on the Closing Date in an amount equal to the outstanding balances and accrued
      interest on the Deposit Liabilities as of the close of business on the third
      business day preceding the Closing Date net of Adjustments (the "Deposit Closing
      Payment"). The Seller shall deliver to the Purchaser on the business day
      immediately prior to the Closing Date a preliminary settlement statement setting
      forth a calculation of the Deposit Closing Payment.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (c)           The
      Seller shall deliver to the Purchaser no later than three (3) business days
      after the Closing Date a final settlement statement the ("Final Settlement
      Statement") setting forth a calculation of the Deposit Transfer Amount and
      the
      difference between the Deposit Transfer Amount and the Deposit Closing Payment.
      If the Purchaser objects to any items on the Final Settlement Statement, the
      Purchaser shall have the right to deliver written notice (the "Disputed Items
      Notice") to the Seller within five (5) days after receipt by the Purchaser
      of
      the Final Settlement Statement, specifying the basis for such objection and
      setting forth the Purchaser's proposed modification to the Final Settlement
      Statement. If the Purchaser delivers a Disputed Items Notice, the Seller and
      the
      Purchaser shall attempt to resolve and determine the correct Deposit Transfer
      Amount as promptly as practicable. In the event the Purchaser delivers a timely
      Disputed Items Notice and the Seller and the Purchaser are unable to resolve
      such dispute within five (5) days after the Purchaser's receipt of such Disputed
      Items Notice, the items in dispute shall be submitted for a final and binding
      determination to an individual independent arbiter jointly selected by the
      Seller and the Purchaser (the "Arbiter").  The Arbiter shall prepare
      his or her resolution statement within five (5) business days of
      appointment.  The difference between the Deposit Transfer Amount and
      the Deposit Closing Payment shall be paid by wire transfer of funds by the
      Seller to the Purchaser or by the Purchaser to the Seller, as applicable, no
      later than five (5) business days after the Closing Date or after the resolution
      of the Purchaser's objections, as the case may be.  Any such amount
      shall accrue interest daily at the average of the near closing bid rates for
      Federal Funds as published in The Wall Street Journal during the period
      (or the most recently published daily rate prior to such date) from, but
      excluding, the Closing Date to and including the date of payment. Further,
      any
      errors on Deposit Liabilities or accrued interest thereon ("Mistakes-in-Fact")
      which are determined as of the date of the Final Settlement Statement shall
      be
      reconciled as of such date and appropriate adjustments of payments shall be
      made
      to the Seller or the Purchaser, as appropriate, at such time. Notwithstanding
      the foregoing, or anything else herein to the contrary, any Mistakes-in-Fact
      which shall be determined by the Seller or the Purchaser thereafter related
      to
      the transactions contemplated hereby shall nevertheless be reconciled by
      adjustment or payment to the Seller or the Purchaser, as appropriate, within
      thirty (30) business days of such determination; provided that any such
      Mistakes-in-Fact must be determined within six months after the Closing Date
      in
      order for a claim to be made with respect thereto.

    

    (d)           The
      Purchaser agrees to pay Seller the following two additional premiums (each
      a
      "Premium") on the deposits identified in Schedule 1.3: (i) THREE PERCENT (3%)
      of
      the outstanding balances and accrued interest on the deposits identified in
      Schedule 1.3 as of the close of business on the ninetieth (90th) day (the
      "Maturity Date") after the Closing Date; and (ii) THREE PERCENT (3%) of the
      outstanding balances on the deposits identified in Schedule 1.3 as of the close
      of business on the one hundred and eightieth (180th) day (the
      "Maturity Date") after the Closing Date.  Purchaser shall pay the
      Seller each Premium by wire transfer of immediately available U.S. funds within
      five business days following the respective Maturity Date for each
      Premium.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (e)           If
      the Seller accepts an item on or before the Closing Date, which item is returned
      as uncollectible, and no offset of funds is available to the Purchaser, then
      the
      Seller shall be liable for such item in an amount equal to the portion not
      covered by offset; provided that, the Seller shall have the exclusive right
      to
      pursue any and all rights and remedies against the party that presented such
      item and the Purchaser agrees to assign to the Seller any and all contractual
      rights necessary for the Seller to pursue such rights and remedies. Adjustment
      to the Deposit Closing Payment will be made as necessary to reflect the Seller's
      liability.

    

    1.4           Purchase
      of Loans.

    

    Seller
      shall transfer to the Purchaser all loans (each a "Loan" and collectively,
      the
      "Loans") attributed on the records of the Seller to the Branch, except that
      overdrafts approved by the Seller with respect to ledger dates on or not more
      than ten (10) days prior to the Closing Date will be handled in accordance
      with
      Section 1.10 and provided that such Loans are no more than ninety (90) days
      past
      due as of the Closing Date as reflected on the records of the
      Seller.  In the event any Loans secured by passbook savings accounts
      are not transferred from the Seller to the Purchaser due to such Loans being
      more than ninety (90) days past due, the passbook savings accounts securing
      such
      Loans will also not be transferred to the Purchaser.  The Loans shall
      be transferred by the Seller to the Purchaser by negotiation of the promissory
      notes and assignment of the applicable security agreements.

    

    1.5           Loan
      Purchase Price.

    

    The
      Purchaser agrees to pay to the Seller, on the Closing Date, an amount equal
      to
      the unpaid principal due on the Loans as reflected on the books of the Seller
      as
      of the Closing Date in immediately available U.S. funds (the "Loan Purchase
      Price").

    

    1.6           Additional
      Obligations of the Parties.

    

    (a)           On
      the Closing Date, the Seller shall:

    

    (i)           execute,
      acknowledge and deliver to the Purchaser all such endorsements, assignments,
      and
      other instruments of conveyance, assignment and transfer that shall reasonably
      be necessary to consummate the assumption of the Deposit Liabilities free and
      clear of all liens and encumbrances and the purchase of the Loans.

    

    (ii)           assign,
      transfer and deliver to the Purchaser such of the following records pertaining
      to the Deposit Liabilities and the Loans as exist and are available (in whatever
      form or medium maintained by the Seller):

    

    
      	
               

            	
              (A)

            	
              signature
                cards, orders and contracts, including promissory notes and security
                agreements related to the Loans, between the Seller and depositors
                at the
                Branch and records of similar character;
                and

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (B)           records
      of account; and

    

    (iii)           for
      five (5) years, unless a longer period is required by applicable law, retain
      the
      records of the Seller which directly relate to any Deposit Liability or Loan
      that are maintained on microfilm, microfiche, computer disk or other media
      and,
      upon reasonable request of the Purchaser made to an officer of the Seller,
      as
      designated from time to time by the Seller, shall provide the Purchaser, at
      the
      Purchaser's expense, with copies of such records in a form reasonably acceptable
      to the Purchaser. The Seller shall promptly respond to requests of the Purchaser
      with the records requested or, for non-routine requests, a date or time by
      which
      a response may be reasonably expected. It is agreed that this obligation of
      the
      Seller shall survive in the event of any change of control transaction of the
      Seller.

    

    (b)           The
      Purchaser agrees that it will preserve and safely keep, for as long as may
      be
      required by applicable law, all of the files, books of account and records
      referred to above for the joint benefit of itself and the Seller, and that
      it
      will permit the Seller or its representatives, at any reasonable time upon
      reasonable notice and at the Seller's expense, to inspect, or to make extracts
      from or copies of, any such files, books of account or records as the Seller
      shall deem reasonably necessary.

    

    (c)           The
      Seller agrees to provide to the Purchaser within thirty (30) days of the date
      hereof and every thirty (30) days thereafter until the Closing Date, an updated
      list of all Deposit Liabilities, identifying the types of each such deposit,
      the
      amounts thereof, the interest rate(s) paid thereon, whether such deposit secures
      a Loan and the name(s) and address(es) of each depositor as well as all other
      pertinent information regarding each depositor. The Purchaser shall have the
      right, prior to the Closing Date, at reasonable times and upon reasonable
      notice, to review the books and records of the Seller relating to such Deposit
      Liabilities in accordance with Section 8.1 for the purpose of verifying the
      accuracy of the foregoing list.

    

    (d)           The
      Seller shall render a final statement of account and related tax reporting
      to
      each depositor whose accounts are assumed by the Purchaser hereunder as of
      the
      Closing Date, including the filing of such tax reporting with the appropriate
      taxing authorities.

    

    (e)           The
      Seller and the Purchaser shall give all notices and take all other actions
      necessary and required, including actions required by applicable laws, in
      connection with the Seller's assignment of and the Purchaser's assumption of
      the
      Deposit Liabilities and the Loans, and the Seller's closing of the Branch as
      of
      the Closing Date, with prior notice to and consultation with the other
      Party.

    

    1.7           Notice
      to Customers/Public Disclosures.

    

    As
      mutually agreed upon by the Parties, the Purchaser and/or the Seller shall,
      notify holders of all accounts at the Branch at least thirty (30) days prior
      to
      the Closing Date of the Transactions and their impact on such account
      holders.  The Purchaser shall not contact any such account holder or
      send any notice to any such account holder without the prior consent of the
      Seller except as otherwise provided herein.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (a)           Any
      press release, public notice or notice to local officials regarding the
      transactions contemplated by this Agreement to be made prior to the Closing
      Date
      shall be approved in writing by both Parties prior to its release, unless the
      form and content of such release or notice are mandated by law, regulations
      or
      government authority. Such approval of either Party shall not be unreasonably
      withheld, conditioned or delayed. If approval is not required, the parties
      nevertheless agree to confer prior to any such release or notice.

    

    (b)           At
      a time mutually agreed upon between the Parties the Purchaser shall, at its
      expense, mail a notice to all depositors of the Branch whose accounts are to
      be
      assumed by the Purchaser notifying them of the impending transactions
      contemplated hereby. Prior to mailing, the Purchaser shall submit the proposed
      form of such notice to the Seller for review and approval, which approval shall
      not be unreasonably withheld, conditioned or delayed.

    

    (c)           At
      a time mutually agreed upon between the Parties, , the Seller shall mail a
      notice to all depositors of the Branch whose accounts are to be assumed for
      the
      purpose of advising them of the impending transactions contemplated hereby.
      Prior to mailing, the Seller shall submit the proposed form of such notice
      to
      the Purchaser for review and approval, which approval shall not be unreasonably
      withheld, conditioned or delayed. Alternatively, the Seller may, at no expense
      to the Seller, fulfill its obligations under this subsection (c) by joining
      in
      the notice to be mailed by the Purchaser pursuant to subsection (b)
      hereinabove.

    

    (d)           No
      later than approximately ten (10) days prior to the Closing Date, the Purchase
      shall notify holders of checks and ATM cards of the procedure for utilizing
      new
      checks and ATM cards to be issued by the Purchaser.

    

    1.8           Certain
      Transitional Matters.

    

    Following
      the Closing Date:

    

    (a)           The
      Purchaser agrees to pay in accordance with law and customary banking practices
      all properly payable, properly drawn, endorsed and presented checks, drafts
      and
      withdrawal orders drawn on accounts assumed by the Purchaser in the transactions
      contemplated hereby and presented to the Purchaser by mail, over the counter
      or
      through the check clearing system of the bank or thrift industry by depositors
      whose accounts are assumed by the Purchaser hereunder, if drawn on the checks,
      drafts or withdrawal order forms provided by the Purchaser, and in all other
      respects to discharge, in the usual course of its banking or thrift business,
      the duties and obligations of the Seller with respect to the balances due and
      owing to such depositors. The Purchaser agrees that it will pay all properly
      payable, properly drawn, endorsed and presented checks, drafts and withdrawal
      orders drawn on accounts assumed by the Purchaser in the Transactions and
      presented to the Purchaser by mail, over the counter or through the check
      clearing system of the bank or thrift industry by depositors whose accounts
      are
      assumed by the Purchaser hereunder, if drawn on the checks, drafts or withdrawal
      order forms of the Seller, for a period of ninety (90) days following the
      Closing Date.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (b)           If
      any such depositors, instead of accepting the obligation of the Purchaser to
      pay
      the Deposit Liabilities, shall demand payment from the Seller for all or any
      part of any such Deposit Liabilities, the Seller shall not be liable for making
      such payment. If any of such depositors shall draw a check, draft or withdrawal
      against the Deposit Liabilities, including accrued interest, which is presented
      or charged to the Seller after the Closing Date, the Seller may pay the same
      and
      the Purchaser agrees to reimburse the Seller promptly upon demand for any such
      payments or charges properly made or incurred as though the Seller was a
      collecting bank and not a payor bank with respect to such checks, drafts or
      withdrawals.  The Seller shall have the obligations of a collecting
      bank and not a payor bank or paying bank with respect to such checks, drafts
      or
      withdrawals. After the Closing, the Seller will make available to the Purchaser
      for pick up from the Seller's offices or the offices of the Seller's agent
      and/or processor all of the checks, drafts, or other items related to the
      Deposit Liabilities that are received by the Seller from the Federal Reserve
      Bank and/or any regional or local clearinghouse during the morning of each
      such
      business day on an "as-received basis."   The Purchaser agrees,
      at its cost and expense, and without charge to such depositors, to notify such
      depositors, within five (5) business days after the Closing Date, of the
      Purchaser's assumption of the Deposit Liabilities and to furnish each such
      depositor with checks, draft or withdrawal orders on the forms of the Purchaser
      and with instructions to utilize the Purchaser's checks, draft or withdrawal
      forms and to destroy unused checks, draft or withdrawal orders of the
      Seller.

    

    (c)           The
      Purchaser agrees to pay promptly to the Seller an amount equal to the amount
      of
      any checks, drafts or withdrawal orders credited to a Deposit Liability (net
      of
      the applicable premium paid by the Purchaser with respect to the deposits
      represented by any such instrument) which are returned to the Seller after
      the
      Closing Date, whether or not such checks, drafts or withdrawal orders were
      credited to such account before or after the Closing Date; provided, however,
      that if the Seller shall have failed to provide to the Purchaser on the Closing
      Date information properly reflecting any provisional credit or uncollected
      funds
      "hold" information with respect to uncollected funds represented by any such
      item, the Purchaser's obligations under this Section 1.8(c) with respect to
      such
      item shall be limited to the amount of collected funds in the applicable deposit
      account.  Adjustments after the Closing Date shall be made daily as
      may be required. Such adjustments shall be delivered by overnight mail or
      courier in the form of a check if less than $1,000.00 or by wire transfer if
      greater than or equal to $1,000.00. The Seller agrees to indemnify and hold
      the
      Purchaser harmless from any loss experienced by the Purchaser attributed to
      any
      inaccurate or erroneous "hold" information provided by the Seller. The Seller
      also agrees to indemnify and hold the Purchaser harmless from any claims or
      losses due to items processed by the Seller at the Branch prior to the Closing
      Date or in accordance with Section 1.8(b) and the law governing the obligations
      of a collecting bank.

    

    (d)           The
      Purchaser agrees to maintain and safeguard in accordance with applicable law
      and
      sound banking practices all account documents, deposit contracts, signature
      cards, deposit slips, canceled items and other records related to the Deposit
      Liabilities assumed by the Purchaser hereunder, subject to the Seller's right
      of
      access to such records as provided herein.

    

    (e)           The
      Purchaser agrees, at its expense, to notify all Automated Clearing House
      originators of the transfers and assumptions made pursuant to this Agreement.
      The Seller agrees to assist the Purchaser in such activities to the extent
      reasonably requested.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (f)           No
      interest in or right to use any logo, name, trademark or service mark presently
      or previously used by the Seller is being conveyed pursuant to this Agreement.
      The costs associated with any actions of the Purchaser to remove the Seller's
      logo, name, trademark or service mark from the Branch shall be at the sole
      expense of the Purchaser.

    

    1.9           Approvals.

    

    The
      obligations of both Parties under this Agreement and in connection with the
      transactions contemplated hereby are subject to the approval of the Office
      of
      Thrift Supervision, the Connecticut Department of Banking, as applicable and
      as
      required, and such additional governmental (including regulatory) approvals,
      permissions and consents, if any, necessary to validly complete and consummate
      any of the Transactions (collectively, the "Government Approvals").

    

    1.10           Overdrafts.

    

    Overdrafts
      approved with respect to ledger dates more than ten (10) days before the Closing
      Date will be the responsibility and risk of the Seller. Overdrafts approved
      with
      respect to ledger dates after the Closing Date will be the responsibility and
      risk of the Purchaser. Overdrafts approved with respect to ledger dates on
      or
      not more than ten (10) days prior to the Closing Date will initially be the
      responsibility and risk of the Purchaser; provided, however, that the Purchaser
      shall have the right to retransfer any such overdrafts  together with
      any and all contractual rights reasonably necessary for the Seller to collect
      such overdrafts, back to the Seller for its responsibility and risk within
      forty-five (45) days following the Closing Date, and the Seller will repurchase
      all rights in respect of such overdrafts from the Purchaser for the amount
      of
      the overdraft outstanding at the time it is retransferred back to the
      Seller.

    

    1.11           Solicitation
      and Non-Competition.

    

    (a)           For
      a period of one (1) year following the Closing Date neither the Seller nor
      any
      parent entity, subsidiary or affiliate of the Seller shall (a) directly target
      or solicit any Branch customer whose deposit liability was transferred to the
      Purchaser at the Closing to directly offer the same or similar deposit products
      as were provided to such customer by the Branch immediately prior to the Closing
      Date, or (b) engage, operate or in any way participate in the operation of
      a
      bank or other depository institution or in any other way, directly or
      indirectly, compete with the Branch, within 10 miles of the Branch.
      Notwithstanding the foregoing sentence, the Seller and its affiliates shall
      be
      permitted to (i) engage in general advertising, solicitations or marketing
      campaigns, programs or other efforts not primarily directed to or targeted
      at
      such customers, and (ii) respond to unsolicited inquiries.  The
      provisions of this Section 1.11(a) shall not apply to the Seller's successors
      or
      assigns if the Seller is acquired in a merger or asset sale transaction with
      a
      third party.

    

    (b)(i)                      From
      the date of this Agreement through the Closing Date, neither the Seller nor
      any
      parent entity, subsidiary or affiliate of the Seller shall solicit any person
      who is an employee of the Seller and works at the Branch as of the date hereof
      (a "Branch Employee") to transfer employment to another office or branch of
      the
      Seller; and (ii) for a period of one year following the Closing Date neither
      the
      Seller nor any parent entity, subsidiary or affiliate of the Seller shall
      solicit any Branch Employees to terminate their employment with the Purchaser;
      provided, however, that the Seller or any parent entity, subsidiary or affiliate
      may hire or offer employment to any Branch Employee who is terminated by the
      Purchaser or who initiates employment discussions with the Seller. Neither
      the
      Purchaser nor any parent entity, subsidiary or affiliate of the Purchaser shall
      solicit any employees of the Seller, or any of its affiliates, to terminate
      their employment with the Seller, or any of its affiliates, and shall not employ
      any such employees or hire any such former employees for a period of one year
      following the Closing Date, except as provided in Article IV hereof; provided,
      however, that the Purchaser may hire any employee discharged by the Seller,
      or
      any parent entity, subsidiary or affiliate of the Seller and may hire or offer
      employment to any person who initiates employment discussions with the
      Purchaser.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    ARTICLE
      II

    SALE
      AND
      PURCHASE OF ASSETS

    

    2.1           Assets.

    

    Subject
      to and in accordance with the provisions and covenants of this Agreement, the
      Seller agrees to sell and the Purchaser agrees to purchase the Assets described
      on the schedule annexed as Schedule 2.1 (the "Assets").

    

    2.2           Asset
      Purchase Price.

    

    The
      Purchaser agrees to pay to the Seller, on the Closing Date, an amount equal
      to
      the net book value of the Assets as reflected on the books of the Seller as
      of
      the Closing Date in immediately available U.S. funds (the "Asset Purchase
      Price"). The net book value of the Assets on the books of the Seller as of
      October 31, 2007 was $663,799.00.

    

    2.3           Warranty
      Bill of Sale and Transfer of Loans

    

    The
      Assets shall be conveyed by the Seller to the Purchaser by a Warranty Bill
      of
      Sale in form attached hereto as Exhibit A (the "Bill of
      Sale").

    

    2.4           No
      Representations or Warranties.

    

    The
      Assets, other than the Loans are being sold "as is", without express or implied
      representation or warranty of any kind by the Seller including, without
      limitation, as to condition or use; and hereby expressly disclaims all
      representations and warranties as to the Assets including, without limitation,
      as to merchantability and fitness for a particular purpose.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    ARTICLE
      III

    ASSIGNMENT
      AND ASSUMPTION OF LEASE AGREEMENT

    

    3.1           Assignment
      and Assumption Agreement.

    

    The
      Seller agrees to assign or obtain the assignment by Southern
      Connecticut Bancorp,
      Inc., the
      holding company for the Seller
      (“SCB”), to
      the Purchaser and the Purchaser agrees to assume that certain Indenture of
      Lease
      dated as of January 14, 2004, (the "Lease Agreement"), by and between SCB as
      Lessee thereunder and the City  of New London (the "Landlord") , a
      copy of which is attached hereto as Schedule 3.1. The assignment shall be
      made pursuant to a Lease Assignment and Assumption Agreement in the form
      attached hereto as Exhibit B (the "Lease Assignment and Assumption
      Agreement").

    

    3.2           Consent.
      The Seller and the Purchaser each shall use commercially reasonable efforts
      to
      obtain the consent by the Landlord to the aforesaid Lease Assignment and
      Assumption Agreement.

    

    

    ARTICLE
      IV

    BRANCH
      EMPLOYEES

    

    4.1.           Employee
      Matters.

    

    (a)           The
      Seller shall notify the Branch Employees of the Transactions after the date
      of
      this Agreement.  The Purchaser shall not contact the Seller's
      employees without the Seller's prior consent.

    

    (b)           The
      Seller has delivered to the Purchaser a list of all Branch Employees that
      includes title and hire date, compensation and copies of general employee
      benefit information. the Purchaser will extend an offer of employment to all
      Branch Employees at their current position, salary and with comparable benefits,
      conditioned upon a subsequent satisfactory review of individual personnel files,
      for that location or for another Branch office of the Purchaser, except as
      described in Schedule 4.1 annexed hereto.

    

    (c)           The
      Seller shall deliver to the Purchaser copies of all records relating to
      withholding and payment of income and unemployment taxes (federal, state and
      local) and FICA taxes (including, without limitation, Forms W-4, Forms I-9,
      Employee's Withholding Allowance Certificate) with respect to wages paid by
      the
      Seller during the 2007 calendar year, and other employee records (including,
      without limitation, performance reviews, pre-employment investigation and
      background checks) with respect to Branch Employees who accept the offer of
      employment from the Purchaser.

    

    (d)           Nothing
      in this Agreement shall be deemed to restrict the right of the Purchaser, after
      the Closing Date, to deal with the Branch Employees as employees at will in
      the
      same manner as it would be free to deal with such Branch Employees in the
      absence of this Agreement.

    

    (e)           All
      Branch Employees shall be considered newly hired by the Purchaser and shall
      not
      be entitled to transfer the time or cash value of any employment-related accrual
      that such Branch Employees may have with the Seller. However, such Branch
      Employees shall, on the Closing Date, be immediately eligible to participate
      as
      "new hires' in all employee benefit plans of the Purchaser for which they may
      qualify and other fringe benefits and perquisites extended to employees
      holding comparable positions with the Purchaser. The Purchaser will permit
      such
      Branch Employees to roll over any retirement plan payments received from the
      Seller into the Purchaser's Profit Sharing and 401(K) Plan to the extent
      permitted by applicable law and regulation. Notwithstanding the foregoing,
      Branch Employees of the Seller hired by the Purchaser who were eligible to
      participate in the Seller's medical, dental, group life insurance, long-term
      disability and other benefit plans shall be given credit for their period of
      employment with the Seller for purposes of determining eligibility for
      participation, but not for benefit accrual, in the medical, dental, group life
      insurance, long-term disability and other employee benefit plans of the
      Purchaser.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (f)           The
      Seller agrees not to transfer any Branch Employees to any other branch of the
      Seller between the date hereof and the Closing Date. The Seller may temporarily
      transfer employees from other branches to the Branch, but none of such employees
      shall be considered Branch Employees. From and after the date of receipt of
      Government Approvals, the Purchaser shall be permitted to conduct training
      sessions on weekends, evening and business days after the Branch office has
      closed for the day, with the Branch Employees who have agreed to accept
      employment with the Purchaser after the Closing Date, provided that the
      Purchaser will in good faith and in consultation with the Seller schedule such
      training sessions in a manner which does not unreasonably interfere with the
      Branch's normal business operations. The Purchaser shall bear the expense of
      such training sessions.

    

    

    ARTICLE
      V

    REPRESENTATIONS
      AND WARRANTIES OF THE SELLER

    

    The
      Seller hereby represents and warrants to the Purchaser as follows:

    

    5.1           Organization
      and Powers.

    

    The
      Seller is a state bank and trust company duly organized, validly existing and
      in
      good standing under the laws of the State of Connecticut. The Seller has the
      corporate power and authority to own its properties, to carry on its business
      at
      the Branch as presently conducted, to execute, deliver and perform this
      Agreement and to effect the transactions contemplated hereby.

    

    5.2           Corporate
      Authority.

    

    The
      execution and delivery of this Agreement and all related agreements by the
      Seller, and the consummation by the Seller of the Transactions, have or will
      have been duly authorized and approved by all necessary corporate action on
      the
      part of the Seller. This Agreement and all related agreements executed and
      delivered by the Seller pursuant hereto have been duly executed and delivered
      by
      the Seller and constitute the valid and binding obligations of the Seller
      enforceable against the Seller in accordance with their respective
      terms.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    5.3           No
      Violation.

    

    Neither
      the execution and delivery by the Seller of this Agreement or any related
      agreements, nor the consummation by the Seller of the transactions contemplated
      hereby, will violate, conflict with or result in a default under (i) the charter
      or bylaws of the Seller, (ii) any provision of any agreement or any other
      restriction to which the Seller is a party or by which the Seller or any of
      its
      properties is bound or (iii) any statute, law, decree, regulation or order
      of
      any government authority, once the Government Approvals are
      obtained.

    

    5.4           Brokers,
      Etc.

    

    Neither
      the Seller nor any of its officers, directors or employees has employed any
      broker or finder, or incurred any liability for any brokerage, finders' or
      similar fees, commissions or expenses in connection with this Agreement or
      the
      transactions contemplated hereby.

    

    5.5           Litigation.

    

    (a)           There
      are no claims, actions, suits, proceedings or to the knowledge of the Seller,
      investigations, at law or in equity, by or before any federal, state, municipal
      or any governmental court, instrumentality or agency, pending, or, to the
      knowledge of the Seller, threatened against or involving the Seller or its
      properties, operations or business which might result in any material adverse
      change to the Deposit Liabilities or the Assets or to the ability of the Seller
      to comply in all material respects with the provisions of this Agreement, nor
      is
      there any valid basis known to the Seller for any such claim, action, suit,
      proceeding or investigation.

    

    (b)           There
      is no injunction, order, judgment, decree, or regulatory restriction imposed
      upon the Seller, the Deposit Liabilities or the Assets, which might have a
      material adverse change to the Deposit Liabilities or the Assets or to the
      ability of the Seller to comply in all material respects with the provisions
      of
      this Agreement.

    

    5.6           Government
      Approvals.

    

    The
      Seller is not aware that any condition exists with respect to the business
      of
      the Seller which will likely result in the denial of any Government
      Approval.

    

    5.7           Status
      of Deposit Liabilities.

    

    With
      respect to each Deposit Liability:

    

    (a)           it
      was solicited and accepted in material compliance with all applicable
      requirements of federal, state, and local law and regulations in effect at
      the
      time of such solicitation and acceptance;

    

    (b)           the
      contract associated with it constitutes a valid, legal, and binding obligation
      of the Seller enforceable in accordance with its terms, subject to rules and
      regulations of the Federal Deposit Insurance Corporation (the "FDIC"), and
      other
      appropriate banking regulations and statutes and to bankruptcy, insolvency,
      fraudulent transfer, reorganization, moratorium, and similar laws of general
      applicability relating to or affecting creditors' rights and to general equity
      principles;

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (c)           it
      was accepted substantially in accordance with the standard acceptance and
      documentation guidelines of the Seller as in effect at the time of its
      acceptance and has been administered substantially in accordance with the
      standard deposit servicing procedures of the Seller as in effect from time
      to
      time;

    

    (d)           it
      was not obtained directly or indirectly through a "deposit broker" (as that
      term
      is defined in Section 337.6(a)(5) of the rules and regulations of the FDIC);
      and

    

    (e)           the
      Seller is in material compliance with the law and Internal Revenue Service
      regulations relative to obtaining from depositors executed IRS Forms W-8 and
      W-9
      or back-up withholding on the applicable account is in effect.

    

    5.8          
      Contracts.

    

    Schedule
      5.8 attached hereto contains a complete and accurate list of all agreements,
      contracts, commitments, undertakings, instruments, and licenses to which the
      Seller is a party with respect to the business and operation of the Branch,
      including all employment arrangements and contracts.

    

    5.9           Loans.

    

    All
      Loans
      were made in the ordinary course of Seller's business, and Seller is unaware
      of
      any reason(s) why the Loans are not enforceable in accordance with their stated
      terms and conditions.

    

    5.10           Regulatory
      Matters.

    

    The
      Seller has not received any notice of action by any government authority which
      would reasonably have a material adverse effect on the Assets, the Deposit
      Liabilities and the business and operations of the Branch.

    

    5.11           Deposit
      Insurance.

    

    The
      deposit accounts of the Branch are insured by the Deposit Insurance Fund in
      accordance with the provisions of the rules and regulations of the FDIC. The
      Seller has paid all regular premiums and special assessments and filed all
      reports required under the rules and regulations of the FDIC.

    

    5.12           Insurance.

    

    Schedule
      5.12 sets forth a description of all the Seller's insurance policies currently
      in effect.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    5.13           Branch
      Employees.

    

    (a)           Except
      as set forth on Schedule 5.13(a) hereto, the Seller has no profit-sharing,
      bonus, incentive, insurance, or other employee benefit plan or policy (including
      without limitation any such plan within the meaning of Section 3(3) of ERISA)
      in
      which any employee at the Branch participates, with respect to which liabilities
      may arise on the part of or be attributed to the Purchaser with respect to
      the
      liabilities, obligations or commitments of the Seller relating to or arising
      under any such benefit plan, whether under ERISA or any other applicable federal
      or state law.

    

    (b)           Schedule
      5.13(b) contains a true and complete list of all Branch Employees as of the
      date
      hereof and the annual compensation, including wages, salaries, bonuses,
      insurance and other compensation and benefits of each of them.

    

    (c)           The
      Seller represents that there are no union or collective bargaining contracts
      covering the employees of the Seller working in the Branch and that the Seller
      has had no communications from any labor unions during the Seller's operation
      of
      the Branch that the Seller believes will result in the negotiation of a
      collective bargaining agreement covering such employees, nor, to the extent
      permitted by law, will the Seller enter into any negotiations or execute any
      contract with a labor union between the signing of this Agreement and the
      Closing Date, nor has it paid any sums of money to any labor union for benefits
      or welfare with respect to the employees of the Seller working in the
      Branch.

    

    5.14           Books
      and Records.

    

    Books
      of
      account and other financial records of the Seller with respect to the business
      and operations of the Branch are in all material respects complete and correct,
      and have been maintained in accordance with good business
      practices.

    

    5.15           Material
      Adverse Change.

    

    Since
      June 30, 2007, there has been no circumstance, change in or effect on the
      Branch, its business, the Assets or the Deposit Liabilities that is materially
      adverse to the deposit-taking business or to the deposit-taking business
      prospects of the Branch, except for (a) changes in general economic, legal,
      regulatory or political conditions, (b) changes in prevailing interest rates,
      (c) changes in generally accepted accounting principles, or (d) any actions
      taken or omitted to be taken by the Purchaser or the Seller if such action
      or
      omission is required or permitted by this Agreement.

    

    5.16           Title
      to Assets.

    

    The
      Seller has good and marketable title to all of the Assets free and clear of
      all
      liens.

    

    5.17           Compliance
      with Laws.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    The
      Seller has complied in all material respects with all applicable laws and
      regulations with respect to the business and operations of the Branch, the
      Assets and the Deposit Liabilities.

    

    5.18           Disclosure.

    

    None
      of
      the representations and warranties made by the Seller in this Agreement contains
      or will contain any untrue statement of a material fact, or omits to state
      any
      material fact necessary to make the statements contained in this Agreement
      not
      misleading. There is no fact known to the Seller that materially adversely
      affects, or in the future may materially adversely affect, individually or
      in
      the aggregate, the condition (financial or otherwise), assets, liabilities,
      business, operations or prospects of the Branch or the ability of the Seller
      to
      consummate the transactions contemplated hereby that has not been set forth
      herein or heretofore communicated to the Purchaser in writing pursuant
      hereto.

    

    

    ARTICLE
      VI

    REPRESENTATIONS
      AND WARRANTIES OF THE PURCHASER

    

    The
      Purchaser hereby represents and warrants to the Seller as follows:

    

    6.1           Organization
      and Powers.

    

    The
      Purchaser is a federally chartered stock savings bank duly organized, validly
      existing and in good standing under the laws of the United States. The Purchaser
      has the corporate power and authority to assume the liabilities and obligations
      being assumed hereunder, to execute, deliver and perform this Agreement and
      to
      consummate the transactions contemplated hereby.

    

    6.2           Corporate
      Authority.

    

    The
      execution and delivery of this Agreement and all related agreements by the
      Purchaser, and the consummation by the Purchaser of the transactions
      contemplated hereby, have been duly authorized and approved by all necessary
      corporate action on the part of the Purchaser. This Agreement and all related
      agreements executed and delivered by the Purchaser pursuant hereto have been
      duly executed by the Purchaser and constitute the valid and binding obligations
      of the Purchaser enforceable against the Purchaser in accordance with their
      respective terms.

    

    6.3           No
      Violation.

    

    Neither
      the execution and delivery by the Purchaser of this Agreement or any related
      agreements, nor the consummation by the Purchaser of the transaction
      contemplated hereby or thereby, will violate, conflict with or result in a
      default under (i) the charter or bylaws of the Purchaser, (ii) any provision
      of
      any agreement or any other restriction to which the Purchaser is a party of
      by
      which the Purchaser or any of its properties is bound, or (iii) any statute,
      law, decree, regulation or order of any government authority, once the
      Government Approvals are obtained.

    

    6.4           Brokers,
      Etc.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Neither
      the Purchaser nor any of its officers, directors or employees has employed
      any
      broker or finder or incurred any liability for any brokerage, finders' or
      similar fees, commissions or expenses in connection with this Agreement or
      the
      transactions contemplated hereby.

    

    6.5           Litigation.

    

    There
      are
      no claims, actions, suits, proceedings or to the knowledge of the Purchaser,
      investigations, at law or in equity, by or before any federal, state, municipal
      or any governmental court, instrumentality or agency, pending, or, to the
      knowledge of the Purchaser, threatened against or involving the Purchaser or
      its
      properties, operations or business which might result in any material adverse
      change in the ability of the Purchaser to comply in all material respects with
      the provisions of this Agreement, nor is there any valid basis known to the
      Purchaser for any such claim, action, suit, proceeding or
      investigation.

    

    6.6           Government
      Approvals.

    

    The
      Purchaser is not aware of any condition that exists with respect to the business
      of the Purchaser which will likely result in the denial of any Government
      Approval.

    

    6.7           Disclosure.

    

    None
      of
      the representations and warranties made by the Purchaser in this Agreement
      contains or will contain any untrue statement of a material fact, or omits
      to
      state any material fact necessary to make the statements contained in this
      Agreement not misleading.

    

    

    ARTICLE
      VII

    CONDUCT
      OF BUSINESS PENDING THE CLOSING DATE

    

    7.1           Conduct
      ofBusiness.

    

    Pending
      the Closing Date, and except in the ordinary course of business, in each
      instance, or as otherwise consented to by the Purchaser, which consent shall
      not
      be unreasonably withheld, conditioned or delayed:

    

    (a)           The
      Seller shall carry on the business of the Branch substantially in the same
      manner as heretofore, and the Seller shall not, with regard to the Branch,
      engage in any activities or transactions outside its ordinary course of business
      as conducted as of the date hereof except for the transactions expressly
      contemplated by this Agreement and shall not transfer any Branch Employee to
      another facility of the Seller, hire any new Branch Employee or terminate the
      employment of any Branch Employee prior to the Closing Date.

    

    (b)           The
      Seller shall use its reasonable best efforts to preserve the business of the
      Branch, to preserve for the Purchaser the goodwill of its customers and others
      doing business with the Branch and to cooperate with and assist the Purchaser
      in
      assuring the orderly transition of such business from the Seller to the
      Purchaser. Nothing herein shall be construed as requiring the Seller to engage
      in any activities or efforts outside the ordinary course of business as
      presently conducted. The Seller shall maintain, or cause to be maintained,
      the
      Branch and any other property appurtenant to or used in connection with the
      Branch, including but not limited to the Assets, in the same condition it was
      as
      of the date of this Agreement, reasonable wear and tear and insured damage
      by
      fire or other casualty excepted;

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (c)           The
      Seller shall not establish interest rates on the Deposit Liabilities prior
      to
      the Closing other than in accordance with the Seller's past practices
      consistently applied to all of its branches;

    

    (d)           The
      Seller shall not transfer funds or deposits from the Branch to any other branch
      of the Seller, except for (i) deposits that, in the sole discretion of the
      Seller, are part of or essential to maintaining relationships with customers
      that have accounts or loans domiciled at any of the Seller's other branches
      and
      (ii) as requested by customers of the Seller for the period beginning on the
      date of this Agreement and ending on the Closing Date;

    

    (e)           The
      Seller shall not accept deposits at the Branch which are obtained directly
      or
      indirectly through a "deposit broker" (as that term is defined in Section
      337.6(a)(5) of the rules and regulations of the FDIC);

    

    (f)           The
      Seller shall not (i) dispose of any of the Assets or of any rights relating
      thereto, and (ii) except in the ordinary course of business, acquire any assets
      with respect to the business or operations of the Branch;

    

    (g)           The
      Seller shall not enter into any contract, commitment or agreement which either
      individually or in the aggregate would have a material adverse effect upon
      the
      business of the Branch or the Assets, or amend, modify adversely, cancel,
      rescind, revoke or terminate any of the Seller's contracts, commitments or
      agreements;

    

    (h)           The
      Seller shall maintain in full force and effect all insurance policies with
      regard to the Branch; and

    

    (i)           The
      Seller shall not consent to any of the actions prohibited pursuant to this
      Section 7.1.

    

    7.2           Reciprocal
      Covenants.

    

    (a)           Subject
      to the terms and conditions herein provided, each Party (i) shall use its
      reasonable best efforts, and shall cooperate fully with the other Party, in
      expeditiously carrying out the provisions of this Agreement; (ii) shall do
      or
      cause to be done all necessary actions, proper, or advisable under applicable
      law to consummate and make effective on the earliest practicable date the
      transactions contemplated hereby, and (iii) shall conduct its affairs so that
      as
      of the Closing Date none of its representations and warranties will be
      inaccurate, none of its covenants and agreements will be breached, and no
      condition in this Agreement will remain unfulfilled by reason of its actions
      or
      omissions.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (b)           Each
      Party represents and warrants to the other that all information concerning
      it
      which is included in any statement and Application (as defined in Section 8.3)
      submitted by a Party shall not, with respect to such Party, contain an untrue
      statement of a material fact or omit any material fact required to be stated
      therein or necessary to make the statements made, in light of the circumstances
      under which they were made, not misleading.

    

    7.3           Standstill.

    

    The
      Seller will not, directly or indirectly, make, encourage, facilitate, solicit,
      assist or initiate any inquiry, proposal or offer to or by, or provide any
      information to or participate in any negotiations with any other party related
      to a liquidation, consolidation, sale, purchase or assumption related to the
      Branch or the Assets or the Deposit Liabilities, participate in any discussions
      or negotiations regarding the same, furnish any information with respect to
      the
      same, assist or participate in, or facilitate in any other manner any effort
      or
      attempt by any person to do or seek any of the foregoing, or make any agreement
      with respect to or engage in any of the foregoing anytime prior to the
      consummation of the transactions contemplated hereby, unless this Agreement
      is
      terminated pursuant to its terms. Any such inquiries, proposals, offers or
      negotiations heretofore being conducted shall immediately be
      terminated.

    

    7.4            Tapes
      and Trial Balances.

    

    As
      soon
      as practicable after the date of this Agreement, but no later than fifteen
      (15)
      days after the date hereof, the Seller shall provide the Purchaser with a trial
      balance tape with corresponding paper trial balances for each of the Deposit
      Liabilities to be assumed by the Purchaser which tapes shall be purged of all
      dormant and duplicate accounts and be limited to the accounts which are
      attributable to the Branch. Such trial balances shall include, but not be
      limited to, general account history, account stops, suspect files and payment
      history. In addition, the Seller shall provide the Purchaser with the same
      on a
      weekly basis, commencing with the end of the week in which the final Government
      Approval is obtained until the Closing Date. The Seller shall provide monthly
      updates of the Deposit Liabilities as provided in Section 1.6(c).

    

    

    ARTICLE
      VIII

    CERTAIN
      OBLIGATIONS OF THE PARTIES

    PRIOR
      TO
      AND AFTER CLOSING DATE

    

    8.1           Access.

    

    The
      Seller shall afford to the officers and authorized representatives of the
      Purchaser, upon at least twenty-four hours prior notice, reasonable access
      to
      the properties, books and records directly related to the Deposit Liabilities
      and the Assets in order that the Purchaser may have the full opportunity to
      make
      reasonable investigations, at reasonable times during normal business hours
      without interfering with the Branch's normal business and operations and the
      affairs of the Seller directly related to the Deposit Liabilities and the
      Assets. The officers of the Seller shall furnish the Purchaser with such
      additional financial and operating data and other information as to the Deposit
      Liabilities and Assets and with access to such personnel of the Branch as the
      Purchaser may, from time to time, reasonably request and with information
      required for inclusion in all Applications. The Purchaser shall not contact
      any
      Branch Employee or customers of the Bank in accordance with the terms hereof.
      Nothing in this Section 8.1 shall be deemed to require the Seller to reveal
      any
      proprietary or confidential information, trade secrets or marketing or strategic
      plans.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    8.2           Confidentiality.

    

    Each
      of
      the Seller and the Purchaser will, and will cause its officers, directors,
      employees and agents to, hold in strict confidence and not disclose to any
      other
      person or entity, without the prior written consent of the other Party, all
      information received by it from or with respect to the other Party in connection
      with this Agreement and the transactions contemplated hereby, including
      information regarding deposits, except such information as may be otherwise
      publicly available or such information as may be required to be disclosed by
      applicable law. Neither Party shall make, issue or release any public
      announcement, statement or acknowledgment of the existence of the transactions
      contemplated hereby without furnishing such announcement, statement or
      acknowledgement in advance to the other Party upon not less than three (3)
      business days notice; provided, however, that the Seller or the Purchaser may,
      upon three (3) business days notice to the other, make any such announcement,
      statement or acknowledgement which in the opinion of its counsel is necessary
      or
      appropriate to comply with applicable law and regulations.

    

    8.3           Applications
      for Approval.

    

    With
      respect to the making of filings to any government authority or third
      party:

    

    (a)            The
      Seller and the Purchaser shall cooperate with each other and use their best
      efforts to promptly prepare and file all necessary documentation; to effect
      all
      applications, notices, petitions and filings; and to promptly obtain all
      permits, consents, approvals, waivers and authorizations of all third parties
      and government authorities which are necessary or advisable to consummate the
      transactions contemplated by this Agreement (collectively, the
      "Applications").

    

    (b)            The
      Seller and the Purchaser shall each use their reasonable best efforts to file
      all the Applications for the Government Approvals and other consents, permits
      and authorizations which such Party is required to obtain in connection with
      the
      consummation of the transactions contemplated by this Agreement within thirty
      (30) days after the date of this Agreement. The Seller and the Purchaser will
      keep the other Party apprised of the status of all applications and
      filings.

    

    (c)           Subject
      to the applicable laws relating to the exchange of information, the Seller
      and
      the Purchaser shall consult with each other and exchange information in order
      to
      obtain all the Government Approvals and any other permits, consents, approvals
      and authorizations that are necessary or advisable to consummate the
      transactions contemplated by this Agreement from all government authorities
      and
      third parties.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (d)           Except
      for any confidential portions thereof, the Party responsible for making a filing
      shall promptly (i) provide a copy of the filing, and any supplement, amendment
      or item of additional information in connection with the filing, to the other
      Party and (ii) deliver a copy of each material notice, order, opinion and other
      item of correspondence received by it from any government authorities to the
      other Party.

    

    (e)           The
      Purchaser and the Seller shall promptly advise each other of any communication
      received from a government authority which causes such Party to believe that
      there is a reasonable likelihood that a Government Approval will not be obtained
      or that the receipt of such approval will be materially delayed.

    

    (f)           The
      Purchaser and the Seller shall each be responsible for its own costs and
      expenses incurred in connection with the matters subject to this Section
      8.3.

    

    (g)           The
      Seller shall, as soon as is practicable, notify the proper authorities of its
      intent to terminate operation of the Branch and to consummate the Transactions
      and thereafter shall comply with the normal and usual requirements imposed
      by
      such authority applicable to effectuate the Transactions.

    

    8.4           Further
      Assurances.

    

    Each
      Party agrees to execute and deliver such instruments and to take such other
      actions as the other Party may reasonably require in order to carry out the
      intent of this Agreement. The Seller agrees to give such acknowledgements and
      other instruments of conveyance, assignment and transfer as, in the reasonable
      judgment of the Purchaser, shall be necessary and appropriate to vest in the
      Purchaser title to the Assets and legal title and authority to hold the assumed
      Deposit Liabilities.

    

    8.5           Customer
      Data.

    

    The
      Purchaser and the Seller shall cooperate with each other and any appropriate
      service bureau and their respective data processors to cause the transfer,
      as of
      the Closing Date, of all information and records relating to the Deposit
      Liabilities from the Seller's computer system to the Purchaser's computer
      system. Specifically, as soon as practicable after the date of this Agreement,
      but no later than fifteen (15) days after the date of this Agreement, the Seller
      shall cause its data processor to provide to the Purchaser's data processor
      all
      system documentation, file layouts and files relating to the Deposit Liabilities
      on tape in a form acceptable to the Purchaser's data processor and provide
      any
      and all additional information and assistance to the Purchaser and/or its data
      processor to enable the Purchaser to complete conversion as contemplated by
      this
      Agreement as well as reasonable and direct access to its data processor in
      order
      to discuss and resolve issues pertaining to the conversion. All deconversion
      fees and costs and the costs of tapes assessed by the Seller's data processor
      for such services, shall be paid by the Seller. The Purchaser shall pay all
      costs and fees assessed by the Purchaser's data processor for the data
      processing conversion, including reproduction fees and costs. In addition,
      prior
      to the Closing Date and upon at least one business day's prior notice, Seller
      shall make available to Purchaser one of Seller's employees for the purpose
      of
      assisting Purchaser in completing the conversion contemplated by this
      Agreement.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    8.6           Risk
      ofLoss.

    

    Between
      the date of this Agreement and the Closing Date, the risk of ownership and
      loss
      of the Assets shall belong solely to the Seller, except as otherwise expressly
      provided by this Agreement. From and after the Closing Date, risk of loss of
      the
      Assets shall belong solely with the Purchaser, except as otherwise specifically
      provided by this Agreement.

    

    8.7           Transfer
      Fees.

    

    The
      Seller and the Purchaser shall equally bear all fees, if any, incurred in
      connection with obtaining third party consents for transfer of the Assets,
      the
      Lease Agreement or any other property to be transferred pursuant to Articles
      II
      and Ill herein from the Seller to the Purchaser and the assumption by the
      Purchaser of the Deposit Liabilities; provided, that, each party shall
      bear its own expenses for any fees required to be paid in connection with
      Government Approvals obtained by such party and each party shall bear its own
      legal expenses in connection with these transactions.

    

    8.8           Certain
      Tax Matters.

    

    (a)           Except
      as otherwise provided herein, the Seller shall be responsible for the payment
      of
      all Taxes relating to the Assets for all taxable periods that end prior to
      the
      close of business on the Closing Date. Responsibility for any federal, state,
      local and foreign income, excise, property, sales, use, information, payroll
      and
      other taxes ("Taxes") relating to the Assets for all taxable periods which
      include (but do not end on) the Closing Date shall be allocated between the
      Purchaser and the Seller in accordance with the method of Section 164(d) of
      the
      Code, as amended. The Purchaser shall be responsible for the payment of all
      Taxes relating to the Assets for all taxable periods that commence on or after
      the Closing Date.  The Party which has the primary obligation to do so
      under applicable law shall file any federal, state, local and foreign income,
      excise, property, sales, use, information, payroll and other tax returns and
      reports required to be filed in respect of Taxes described in this section
      ("Tax
      Return"), and that Party shall pay the Taxes shown on such Tax Return and notify
      the other Party in writing of the other Party's share of Taxes for which it
      is
      responsible, if any, of the Taxes shown on such Tax Return and how such Taxes
      and share were calculated, which the other Party shall reimburse by wire
      transfer of immediately available funds no later than ten (10) days after
      receipt of such notice.

    

    (b)            The
      Purchaser and the Seller shall each pay half of all transfer, recording, sales,
      use (including all bulk sales taxes) and other similar taxes and fees
      (collectively, the "Transfer Taxes") arising out of or in connection with the
      transactions effected pursuant to this Agreement, other than such Taxes as
      are
      calculated with reference to the income or gain of the Seller, which shall
      be
      paid by the Seller. The Party which has the primary obligation to do so under
      applicable law shall file any Tax Return that is required to be filed in respect
      of Taxes described in this section, and that Party shall pay the Taxes shown
      on
      such Tax Return and notify the other Party in writing of the other Party's
      share
      of Taxes for which it is responsible, if any, of the Taxes shown on such Tax
      Return and how such Taxes and share were calculated, which the other Party
      shall
      reimburse by wire transfer of immediately available funds no later than ten
      (10)
      days after receipt of such notice.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (c)            The
      Seller and the Purchaser shall provide each other with such assistance as
      reasonably may be requested by either of them in connection with (i) the
      preparation of any Tax Return, or (ii) any audit or other examination by any
      taxing authority, or any judicial or administrative proceedings relating to
      liability for Taxes. The Party requesting assistance hereunder shall reimburse
      the other Party for reasonable out-of-pocket (not including overhead) expenses
      incurred in providing such assistance, provided, however, that no independent
      contractors, such as accountants or attorneys, shall be consulted without the
      written consent of the Party requesting assistance, which consent shall not
      be
      unreasonably withheld.

    

    (d)           The
      Seller shall pay all taxes and relating penalties, if any, associated with
      any
      qualified or non-qualified pension or welfare benefit plan maintained by the
      Seller.

    

    

    ARTICLE
      IX

    CONDITIONS
      TO THE PURCHASER'S OBLIGATIONS

    

    The
      obligations of the Purchaser to consummate the transactions contemplated hereby
      are conditioned upon fulfillment, at or before the Closing Date, of each of
      the
      following conditions:

    

    9.1           Representations
      and Warranties True.

    

    The
      representations and warranties made by the Seller in this Agreement that are
      qualified as to materiality shall be true, correct and complete in all respects
      and those that are not so qualified, shall be true, correct and complete in
      all
      material respects at and as of the Closing Date as though such representations
      and warranties were made at and as of the Closing Date, other than the
      representations and warranties as are made of another date, except for any
      changes permitted by the terms hereof or consented to by the
      Purchaser.

    

    9.2           Obligations
      Performed.

    

    The
      Seller shall have performed and complied in all material respects with all
      obligations and agreements required by this Agreement to be performed or
      complied with by it prior to or on the Closing Date.

    

    9.3           Certificate
      of Compliance.

    

    The
      Seller shall have delivered to the Purchaser a certificate of its Chief
      Executive Officer, dated the Closing Date, certifying to the fulfillment of
      each
      of the foregoing conditions and the conditions set forth in Section 9.4 and
      Section 9.8. Such certificate may be qualified to the extent of the knowledge
      of
      the Seller with respect to orders, actions, suits and proceedings (i) pending
      or
      threatened against the Purchaser or (ii) threatened against the
      Seller.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    9.4           No
      Adverse Litigation.

    

    On
      the
      Closing Date, no action, suit or proceeding shall be pending or to the knowledge
      of the Seller threatened nor any order have been entered (i) against the Seller
      which might reasonably be expected to materially and adversely affect the
      transactions contemplated hereby or the business of the Branch, the Assets
      and
      the Deposit Liabilities or (ii) against the Seller or the Purchaser seeking
      to
      enjoin the consummation of the transactions contemplated hereby.

    

    9.5           Government
      Approvals and Other Consents.

    

    The
      Purchaser shall have received the applicable Government Approvals and other
      required consents and all applicable waiting periods shall have expired or
      evidence of waiver thereof shall have been obtained. The Seller shall have
      received the applicable Government Approvals and other required
      consents.

    

    9.6           Management
      Certifications.

    

    The
      Purchaser shall have received a certificate of the Chief Executive Officer
      of
      the Seller, dated the Closing Date, to the effect that:

    

    (i)            The
      Seller is a state chartered bank and trust company duly organized, validly
      existing and in good standing under the laws of the State of
      Connecticut;

    

    (ii)            The
      execution and delivery of this Agreement and all related agreements by the
      Seller, and the consummation by the Seller of the transactions contemplated
      hereby, have been duly authorized by all necessary corporate action on the
      part
      of the Seller. This Agreement and all related agreements executed and delivered
      by the Seller pursuant hereto have been duly executed by the Seller and
      constitute the valid and binding obligations of the Seller enforceable against
      the Seller in accordance with their respective terms, subject to the provisions
      of federal and other applicable bankruptcy, insolvency, reorganization,
      moratorium, receivership, conservatorship or similar laws relating to or
      affecting the enforcement of creditors' rights generally, now or hereafter
      in
      effect, and subject to general equity principles, which may limit enforcement
      of
      certain remedies; and

    

    (iii)            To
      his knowledge, neither the execution and delivery by the Seller of this
      Agreement or any related agreements, nor the consummation by the Seller of
      the
      transactions contemplated hereby, will violate, conflict with or result in
      a
      default under (A) the charter or bylaws of the Seller, (B) any provision of
      any
      agreement or any other restriction known to him to which the Seller is a party
      or by which the Seller or any of its properties is bound or (C) any statute,
      law, decree, regulation or order of any government authority known to
      him.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    9.7           Warranty
      Bill of Sale.

    

    The
      Seller shall have delivered the validly executed and duly authorized Warranty
      Bill of Sale.

    

    9.8           No
      Material Adverse Change.

    

    From
      the
      date of this Agreement until the Closing Date, there shall have occurred no
      circumstance, change in or effect on the Branch, its business, the Assets or
      the
      Deposit Liabilities that is materially adverse to the deposit-taking business
      of
      the Branch, except for (a) changes in general economic, legal, regulatory or
      political conditions, (b) changes in prevailing interest rates, (c) changes
      in
      generally accepted accounting principles, or (d) any actions taken or omitted
      to
      be taken by the Purchaser or the Seller if such action or omission is required
      by this Agreement.

    

    9.9            Payment.

    

    The
      Seller shall have made all payments required to be made by Seller on or prior
      to
      the Closing Date.

    

    9.10           Landlord's
      Consents.

    

    The
      Landlord shall have consented to
      the Lease Assignment and Assumption Agreement.

    

    9.11           Minimum
      Level of Deposits.

    

    At
      and as of Closing Date the aggregate
      amount of Deposit Liabilities assumed by Purchaser shall equal or exceed $
      9
      million.

    

    

    ARTICLE
      X

    CONDITIONS
      TO THE SELLER'S OBLIGATIONS

    

    The
      obligations of the Seller to consummate the transactions contemplated hereby
      are
      conditioned upon fulfillment, at or before the Closing Date, of each of the
      following conditions:

    

    10.1           Representations
      and Warranties True.

    

    The
      representations and warranties made by the Purchaser in this Agreement that
      are
      qualified as to materiality shall be true, correct and complete in all respects
      and those that are not so qualified shall be true, correct and complete in
      all
      material respects at and as of the Closing Date, as though such representations
      and warranties were made at and as of the Closing Date, other than the
      representations and warranties as are made of another date, except for any
      changes permitted by the terms hereof or consented to by the
      Seller.

    

    10.2           Obligations
      Performed.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    The
      Purchaser shall have performed and complied in all material respects with all
      obligations and agreements required by this Agreement to be performed or
      complied with by it prior to or on the Closing Date.

    

    10.3           Certificate
      ofCompliance.

    

    The
      Purchaser shall have delivered to the Seller a certificate of its President,
      dated the Closing Date, certifying to the fulfillment of each of the foregoing
      conditions and the condition set forth in Section 10.4. Such certificate may
      be
      qualified to the extent of the knowledge of the Purchaser with respect to
      orders, actions, suits and proceedings (i) pending or to the knowledge of the
      Purchaser threatened against the Seller or (ii) threatened against the
      Purchaser.

    

    10.4           No
      Adverse Litigation.

    

    On
      the
      Closing Date, no action, suit or proceeding shall be pending or to the knowledge
      of the Purchaser threatened nor any order have been entered (i) against the
      Purchaser which might reasonably by expected to materially and adversely affect
      the transactions contemplated hereby or (ii) against the Seller or the Purchaser
      seeking to enjoin the consummation of the transactions contemplated
      hereby.

    

    10.5           Assumption
      Agreements.

    

    The
      Purchaser shall have executed and delivered to the Seller assumption agreements
      in form and substance satisfactory to the Seller and its counsel to evidence
      the
      assumption by the Purchaser of the liabilities and obligations of the Seller
      to
      be assumed pursuant to this Agreement.

    

    10.6           Government
      Approvals and Other Consents.

    

    The
      Purchaser shall have received the applicable Government Approvals and other
      required consents and all applicable waiting periods shall have expired or
      evidence of waiver thereof shall have been obtained. The Seller shall have
      received the applicable Government Approvals and other required
      consents.

    

    10.7           Management
      Certification.

    

    The
      Seller shall have received a certificate of the President of the Purchaser,
      dated the Closing Date, to the effect that:

    

    (i)            The
      Purchaser is a federally chartered stock savings bank duly organized, validly
      existing and in good standing under the laws of the United States;

    

    (ii)            The
      execution and delivery of this Agreement and all related agreements by the
      Purchaser, and the consummation by the Purchaser of the transactions
      contemplated hereby, have been duly authorized by all necessary corporate action
      on the part of the Purchaser. This Agreement and all related agreements executed
      and delivered by the Purchaser pursuant hereto have been duly executed by the
      Purchaser and constitute the valid and binding obligations of the Purchaser
      enforceable against the Purchaser in accordance with their respective terms,
      subject to the provisions of federal and other applicable bankruptcy,
      insolvency, reorganization, moratorium, receivership, conservatorship or similar
      laws relating to or affecting the enforcement of creditors' rights generally,
      now or hereafter in effect, and subject to general equity principles, which
      may
      limit enforcement of certain remedies; and

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (iii)            To
      his knowledge, neither the execution and delivery by the Purchaser of this
      Agreement or any related agreements, nor the consummation by the Purchaser
      of
      the transactions contemplated hereby, will violate, conflict with or result
      in a
      default under (A) the charter or bylaws of the Purchaser, (B) any provision
      of
      any agreement or any other restriction known to him to which the Purchaser
      is a
      party or by which the Purchaser or any of its properties is bound or (C) any
      statute, law, decree, regulation or order of any government authority known
      to
      him.

    

    10.8           Payment.

    

    The
      Purchaser shall have made all payments required to be made to the Seller
      hereunder.

    

    10.9           Landlord's
      Consents.

    

    The
      Landlord shall have consented to
      the Lease Assignment and Assumption Agreement.

    

    10.9           Seller's
      Notice to Holders.

    

    The
      Seller shall have given to the
      holders of the accounts at the Branch, notice of the Transactions at least
      thirty (30) days prior to the Closing Date.

    

    

    

    ARTICLE
      XI

    INDEMNIFICATION

    

    11.1           Survival
      of Representations, Warranties and Indemnity.

    

    No
      rights
      to indemnification with respect to breaches of the representations and
      warranties of the parties contained in this Agreement shall be asserted by
      any
      Party unless notice thereof is given on or before the date such representation
      or warranty no longer survives as provided in this Section 11.1. The
      representations and warranties of the Seller and the Purchaser contained in
      this
      Agreement or in any certificate or instrument delivered pursuant to this
      Agreement shall survive the Closing Date and shall expire on the second
      anniversary of the Closing Date.

    

    11.2           Indemnification
      by the Seller.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    The
      Seller shall indemnify, hold harmless and defend the Purchaser and its
      affiliates and their respective successors, permitted assigns, directors,
      shareholders, officers, agents and employees from and against all losses and
      liabilities, including reasonable counsel fees and expenses (the "Losses"),
      arising out of (1) any and all claims, actions, suits or proceedings commenced
      prior to the Closing Date (other than proceedings related to the Purchaser
      or to
      this transaction and proceedings to prevent or limit the consummation of this
      Agreement) relating to the operations of the Seller prior to the Closing Date
      ("Claims"), (2) any misrepresentation or breach of any representation, warranty,
      covenant or agreement made or to be performed by the Seller pursuant to this
      Agreement and (3) any action taken or omitted to be taken by the Seller prior
      to
      or on the Closing Date with respect to the Deposit Liabilities and with respect
      to the operations of the Branch.

    

    11.3           Indemnification
      by the Purchaser.

    

    The
      Purchaser shall indemnify, hold harmless and defend the Seller and its
      affiliates, and its and their respective successors, permitted assigns,
      directors, shareholders, officers, agents and employees from and against all
      Losses arising out of (1) any and all Claims relating to the operations of
      the
      Branch by the Purchaser after the Closing Date, (2) any misrepresentation or
      breach of any representation warranty, covenant or agreement made or to be
      performed by the Purchaser pursuant to this Agreement, and (3) any payments
      or
      charges made or incurred by the Seller with respect to checks, drafts and
      withdrawals presented to the Seller after the Closing Date and which are drawn
      on or chargeable to accounts assumed by the Purchase hereunder, and (4) any
      action taken or omitted to be taken by the Purchaser after the Closing Date
      with
      respect to the Deposit Liabilities and with respect to the operations of the
      Branch.

    

    11.4           Procedure
      for Indemnification.

    

    (a)           If
      a party entitled to be indemnified under this Agreement (an "Indemnitee")
      receives notice of the assertion by an unaffiliated third party (a "Third
      Party") of any Claim (a "Third Party Claim") with respect to which another
      Party
      hereto (an "Indemnifying Party") is obligated to provide indemnification, the
      Indemnitee shall give the Indemnifying Party prompt notice thereof after
      becoming aware of such Third Party Claim. Such notice shall describe the Third
      Party Claim in reasonable detail and shall indicate the amount (estimated if
      necessary) of the Loss that has been or may be sustained by the Indemnitee.
      Such
      notice shall be a condition precedent to any liability of the Indemnifying
      Party
      for any Third Party Claim under the provisions for indemnification contained
      in
      this Agreement; provided, however, that the failure of the lndemnitee to give
      prompt notice to the Indemnifying Party of such Third Party Claim shall
      adversely affect the Indemnitee's rights to indemnification hereunder solely
      to
      the extent that such failure prejudices the Indemnifying Party in the defense
      of
      such Third Party Claim.

    

    (b)           The
      Indemnifying Party may elect to compromise or defend, at such Indemnifying
      Party's own expense and by such Indemnifying Party's own counsel, any Third
      Party Claim. If the Indemnifying Party elects to compromise or defend such
      Third
      Party Claim, it shall, within thirty (30) days after receiving notice of the
      Third Party Claim, notify the Indemnitee of its intent to do so, and the
      Indemnitee shall cooperate at the expense of the Indemnifying Party, in the
      compromise of, or defense against, such Third Party Claim. If the Indemnifying
      Party elects not to compromise or defend against the Third Party Claim, or
      fails
      to notify the lndemnitee of its election as herein provided, or otherwise
      abandons the defense of such Third Party Claim, (i) the Indemnitee may satisfy
      (without prejudice of any of its rights as against the Indemnifying Party),
      compromise or defend such Third Party Claim and (ii) the costs and expenses
      of
      the lndemnitee incurred in connection therewith shall be indemnifiable by the
      Indemnifying Party pursuant to the terms of this Agreement and the Indemnifying
      Party shall be entitled to participate in (but not control) the defense of
      such
      action, with its counsel and at its own expense.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (c)           In
      addition, in connection with any Third Party Claim in which the Indemnitee
      shall
      reasonably conclude, based upon a written opinion of its counsel available
      to
      the Indemnifying Party, that (i) there is a conflict of interest between the
      Indemnifying Party and the Indemnitee in the conduct of the defense of such
      Third Party Claim or (ii) there are specific defenses available to the
      Indemnitee which are different from or additional to those available to the
      Indemnifying Party and which could be materially adverse to the Indemnifying
      Party, then the Indemnitee shall have the right to retain separate counsel
      in
      connection with such Third Party Claim. In such an event, the Indemnifying
      Party
      shall pay the reasonable fees and disbursements of counsel to each of the
      Indemnifying Party and the Indemnitee, provided however, that the Indemnifying
      Party will not be responsible for the fees of more than one counsel for all
      Indemnitees.

    

    (d)           Notwithstanding
      the foregoing, neither the Indemnifying Party nor the Indemnitee may settle
      or
      compromise any claim (unless the sole relief payable to a Third Party in respect
      of such Third Party Claim is monetary damages that are paid in full by the
      party
      settling or compromising such claim) over the objection of the other, provided,
      however, that consent to settlement or compromise shall not be unreasonably
      withheld.

    

    (e)           In
      any event, except as otherwise provided herein, the Indemnitee may participate
      in (but not control), with its counsel and at its own expense, in the defense
      of
      such Third Party Claim.

    

    (f)           If
      the Indemnifying Party chooses to defend any claim, the Indemnitee shall make
      available to the Indemnifying Party any personnel or any books, records or
      other
      documents within its control that are reasonably necessary or appropriate for
      such defense, subject to the receipt of reasonably appropriate confidentiality
      agreements.

    

    (g)           Notwithstanding
      anything to the contrary stated hereinabove in this section, if prompt action
      is
      required with respect to the defense of a Third Party Claim, the Indemnitee
      shall, subject to the terms and conditions of this Article XI, have the right
      to
      assume the defense of such Third Party Claim; provided, however, that if the
      Indemnifying Party subsequently elects to assume the defense of such Third
      Party
      Claim, then the provisions set forth hereinabove shall be applicable and the
      Indemnifying Party shall, subject to the terms and conditions of this Agreement,
      reimburse the Indemnitee for any costs and expenses reasonably incurred by
      the
      Indemnitee prior to the date the Indemnifying Party assumes control of such
      Third Party Claim.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (h)            Notwithstanding
      the foregoing, if an offer of settlement or compromise is received by or
      communicated to the Indemnifying Party with respect to a Third Party Claim
      and
      the Indemnifying Party notifies the Indemnitee in writing of the Indemnifying
      Party's willingness to settle or compromise such Third Party Claim on the basis
      set forth in such notice and the Indemnitee declines to accept such settlement
      or compromise, the lndemnitee may continue to contest such Third Party Claim,
      without any participation by the Indemnifying Party, at the Indemnitee's sole
      expense. The obligation of the Indemnifying Party to the Indemnitee with respect
      to such Third Party Claim shall be equal to the lesser of (i) the amount of
      the
      offer of settlement or compromise which the Indemnitee declined to accept plus
      the costs and expenses of the Indemnitee prior to the date the Indemnifying
      Party notifies the Indemnitee of the Indemnifying Party's willingness to settle
      or compromise such Third Party Claim or (ii) the amount the Indemnitee is
      obligated to pay as a result of the Indemnitee's continuing to contest such
      Third Party Claim including costs and expenses with respect thereto; and the
      Indemnifying Party shall be entitled to recover (by set-off or otherwise) from
      the lndemnitee any additional expenses incurred by the Indemnifying Party as
      a
      result of the Indemnitee's decision to continue to contest such Third Party
      Claim.

    

    (i)           Any
      claim on account of a Loss which does not involve a Third Party Claim shall
      be
      asserted by a written notice given by the party claiming indemnity to the party
      from which indemnity is claimed. The recipient of such notice shall have a
      period for sixty (60) days within which to respond thereto. If such recipient
      does not respond within such 60-day period, such recipient shall be deemed
      to
      have accepted responsibility to make payment, subject to the provisions hereof,
      and shall have no further right to contest the validity of such claim. If the
      recipient responds within such 60-day period and rejects such claim in whole
      or
      in part, the party claiming indemnity shall be free to pursue such remedies
      as
      may be available to such party under applicable law.

    

    (j)           Following
      the Closing, each Party shall use its best efforts to make available to the
      other Party, upon written request, its employees and agents as witnesses to
      the
      extent that any such person may be reasonably required in connection with any
      legal, administrative or other proceedings in which the requesting Party may
      from time to time be involved.

    

    

    ARTICLE
      XII

    TERMINATION

    

    12.1           Methods
      of Termination.

    

    This
      Agreement may be terminated in any of the following ways:

    

    (a)           at
      any time on or before the Closing Date by the mutual written consent of the
      Purchaser and the Seller;

    

    (b)           on
      the Closing Date, by the Purchaser in writing if the conditions set forth in
      Article IX of this Agreement shall not have been met by the Seller or waived
      in
      writing by the Purchaser;

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (c)           on
      the Closing Date, by the Seller in writing if the conditions set forth in
      Article X of this Agreement shall not have been met by the Purchaser or waived
      in writing by the Seller;

    

    (d)           at
      any time on or before the Closing Date, by the Seller or the Purchaser in
      writing if the other shall have breached any representation or warranty in
      any
      material respect (as if such representation or warranty had been made on and
      as
      of the date hereof and on and as of the date of the notice of breach referred
      to
      below) or any covenant, undertaking or obligation contained herein and such
      breach shall not have been cured by the earlier of thirty (30) days after the
      giving notice to the breaching Party of such breach or the Closing
      Date;

    

    (e)            by
      the Seller or the Purchaser in writing at any time after any of the regulatory
      authorities has denied any Application of the Purchaser or the Seller;
      and

    

    (f)           by
      the Seller or the Purchaser in writing if the Transactions are not consummated
      on or before March 31, 2008, unless extended in writing with the consent of
      both
      Parties.

    

    12.2            Procedure
      Upon Termination.

    

    In
      the
      event of termination pursuant to Section 12.1 hereof, written notice thereof
      shall forthwith be given to the other Party, and this Agreement shall terminate
      immediately upon receipt of such notice. If this Agreement is terminated as
      provided herein:

    

    (a)           each
      Party will promptly return all documents, work papers and other materials of
      the
      other Party relating to the Transactions, whether obtained before or after
      the
      execution hereof, to the Party furnishing the same; and

    

    (b)           all
      information received by either Party with respect to the business of the other
      Party (other than information which is a matter of public knowledge or which
      has
      heretofore been or is hereafter published in any publication for public
      distribution or filed as public information with any government authority)
      shall
      remain strictly confidential and shall not at any time be used for any business
      purpose by such Party or disclosed by such Party to third persons.

    

    

    ARTICLE
      XIII

    MISCELLANEOUS
      PROVISIONS

    

    13.1           Amendment
      and Modification.

    

    The
      Parties, by mutual written consent, may amend, modify and supplement this
      Agreement in such manner as may be agreed upon by them in writing. This
      Agreement and the exhibits and schedules hereto constitute the entire agreement
      of the Parties.

    

    13.2       
      Waiver
      or Extension.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Either
      of
      the Parties, by a written instrument signed by a duly authorized officer, may
      extend the time for the performance of any of the obligations or other acts
      of
      the other Party and may waive (i) any inaccuracies in the representations or
      warranties of the other Party contained herein or in any document delivered
      by
      the other Party pursuant hereto or (ii) compliance with any of the undertakings,
      obligations, covenants or other acts of the other Party contained herein or
      in
      any such document.

    

    13.3           No
      Assignment.

    

    Neither
      this Agreement nor any of the rights, interests or obligations hereunder shall
      be assigned, prior to the Closing Date, by either of the Parties without the
      prior written consent of the other.

    

    13.4           Survival.

    

    The
      representations, warranties, conditions and obligations set forth in this
      Agreement shall not survive the Closing Date except as expressly provided to
      the
      contrary herein and except for obligations that are to be performed after the
      Closing Date pursuant to their terms.

    

    13.5           Payment
      of Expenses.

    

    Except
      as
      otherwise specifically provided in this Agreement, each Party shall bear and
      pay
      all costs and expenses incurred by it or on its behalf in connection with this
      Agreement and the Transactions. If this Agreement is terminated pursuant to
      Section 12.1(iv), the Party on account of whose breach this Agreement was
      terminated shall pay to the other Party the aggregate sum of $25,000 as
      liquidated damages and as the sole remedy upon termination of this
      Agreement.

    

    
      	
               

            	
              13.6

            	
              Addresses
                for Notices, Etc.

            

    

    

    All
      notices, requests, demands, consents and other communications provided for
      hereunder and under any related agreements shall be in writing and mailed (by
      registered or certified mail) or delivered by any other means to the applicable
      Party at the addresses indicated below:

    
      

      
        	
                If
                  to the Purchaser to:

              	
                Savings
                  Institute Bank and Trust Company

              
	 	
                803
                  Main Street

              
	 	
                Willimantic,
                  CT 06226

              
	 	
                ATTN:
                  Rheo A. Brouillard,

              
	 	
                President
                  and CEO

              
	 	 
	
                With
                  a copy to:

              	
                William
                  W. Bouton III, Esq.

              
	 	
                Tyler
                  Cooper & Alcorn, LLP

              
	 	
                185
                  Asylum Street

              
	 	
                City
                  Place I, 35th Floor

              
	 	
                Hartford,
                  CT 06103

              

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        	
                If
                  to the Seller to:

              	
                The
                  Bank of Southern Connecticut

              
	 	
                215
                  Church Street

              
	 	
                New
                  Haven, CT 06510

              
	 	
                ATTN:
                  Elmer F. Laydon

              
	 	
                Chairman
                  of the Board

              
	 	 
	
                With
                  a copy to:

              	
                Robert
                  M. Taylor, Esq.

              
	 	
                Day
                  Pitney LLP

              
	 	
                242
                  Trumbull Street

              
	 	
                Hartford,
                  Ct. 06103

              

      

      
or,
        as to
        each Party, at such other address as shall be designated by such Party in
        a
        written notice to the other Party complying as to delivery with the terms
        of
        this Section 13.6.

    

    

    
      	
               

            	
              13.7

            	
              Counterparts.

            

    

    

    This
      Agreement may be executed in
      counterparts (which may include signature pages delivered by facsimile or other
      electronic means), each of which when so executed and delivered shall constitute
      a complete and original instrument but all of which together shall constitute
      one and the same agreement, and it shall not be necessary when making proof
      of
      this Agreement or any counterpart thereof to account for any other
      counterpart.

    

    
      	
               

            	
              13.8

            	
              Governing
                Law.

            

    

    

    This
      Agreement shall be governed by, and construed in accordance with, the laws
      of
      the State of Connecticut, except to the extent that federal law, statutes or
      regulations are applicable.

    

    13.9           Separability.

    

    The
      invalidity or unenforceability of any term, phrase, clause, section, paragraph,
      restriction, covenant, agreement or other provision in this Agreement shall
      in
      no way affect the validity or enforcement of any other provision, or any part
      hereof; provided, however, that notwithstanding anything herein to the contrary,
      this Section 13.9 shall not apply to the closing conditions and deliveries
      of
      the Parties under this Agreement.

    

    
      	
            	
              13.10

            	
              No
                Third-Party Beneficiaries.

            

    

    

    The
      Parties intend that this Agreement shall not benefit or create any right or
      cause of action in or on behalf of any person other than the Seller and the
      Purchaser.

    

    
      	
            	
              13.11

            	
              Consent
                to Arbitration.

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Any
      controversy or claim arising out of or relating to this Agreement, or the breach
      thereof, shall be settled by arbitration in accordance with the rules for
      commercial arbitration then in effect at the district office of the American
      Arbitration Association nearest to New York, New York, and judgment upon the
      award rendered may be entered in any court having jurisdiction thereof, except
      to the extent that the Parties may otherwise reach a mutual settlement of such
      issue.

    

    [Signature
      page follows]

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, the Parties have
      caused this Agreement to be duly executed by their duly authorized officers
      as
      of the date first above written.

    
 

    
      
        	 	
                Savings
                  Institute Bank and Trust Company

              
	 	
                ("PURCHASER")

              
	 	 	 
	 	 	 
	 	
                By:

              	
                /s/
                  Rheo A. Brouillard

              
	 	 	
                Name:
                  Rheo A. Brouillard

              
	 	 	
                Title:
                  President and CEO

              
	 	 	 
	 	 	 
	 	 	 
	 	
                The
                  Bank of Southern Connecticut

              
	 	
                ("SELLER")

              
	 	 	 
	 	 	 
	 	
                By:

              	
                /s/
                  Michael M. Ciaburri

              
	 	 	
                Name:
                  Michael M. Ciaburri

              
	 	 	
                Title:
                  President and CEOex10_1.htm

    Exhibit
      10.1

     

    14
      NOVEMBER 2007

    
 

     

    

     

    

     

    XL
      CAPITAL LTD

     

    as
      Account Party

     

     

    THE
      GUARANTORS

     

    (as
      defined herein)

     

     

    THE
      LENDERS PARTY HERETO

     

    (as
      defined herein)

     

     

    CITIBANK
      INTERNATIONAL PLC

     

    as
      Agent and Security Trustee

     

    

     

    CITIGROUP
      GLOBAL MARKETS LIMITED and LLOYDS TSB BANK PLC and

    THE
      ROYAL BANK OF SCOTLAND PLC

    as
      Arrangers

     

    
      
        __________________________________

      

       

      LETTER
        OF CREDIT FACILITY AND

      REIMBURSEMENT
        AGREEMENT

      ___________________________________

      
 

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

    

    CONTENTS

     

     

     

    
      	
              Clause

               

            	 	
              Page

               

            
	
              1

               

            	
              DEFINITIONS

               

            	
              1

            
	
              2

               

            	
              THE
                FACILITY

               

            	
              13

               

            
	
              3

               

            	
              UTILISATION
                OF THE FACILITY

               

            	
              14

               

            
	
              4

               

            	
              TERMINATION
                OF LETTERS OF CREDIT

               

            	
              15

               

            
	
              5

               

            	
              PAYMENT
                OF DEMANDS

               

            	
              18

               

            
	
              6

               

            	
              THE
                ACCOUNT PARTY’S LIABILITIES IN RELATION TO LETTERS OF CREDIT

               

            	
              19

               

            
	
              7

               

            	
              DEFAULT
                INTEREST

               

            	
              20

               

            
	
              8

               

            	
              TERMINATION
                AND REDUCTION OF THE COMMITMENTS

               

            	
              20

               

            
	
              9

               

            	
              FEES

               

            	
              21

               

            
	
              10

               

            	
              TAXES

               

            	
              23

               

            
	
              11

               

            	
              TAX
                RECEIPTS

               

            	
              24

               

            
	
              12

               

            	
              INCREASED
                COSTS

               

            	
              25

               

            
	
              13

               

            	
              ILLEGALITY

               

            	
              26

               

            
	
              14

               

            	
              MITIGATION
                OBLIGATIONS; REPLACEMENT OF LENDERS

               

            	
              26

               

            
	
              15

               

            	
              PAYMENTS
                GENERALLY; PRO RATA TREATMENT; SHARING OF SET-OFFS

               

            	
              27

               

            
	
              16

               

            	
              GUARANTEE
                AND INDEMNITY

               

            	
              29

               

            
	
              17

               

            	
              REPRESENTATIONS
                AND WARRANTIES

               

            	
              32

               

            
	
              18

               

            	
              AFFIRMATIVE
                COVENANTS

               

            	
              35

               

            
	
              19

               

            	
              NEGATIVE
                COVENANTS

               

            	
              39

               

            
	
              20

               

            	
              EVENTS
                OF DEFAULT

               

            	
              43

               

            
	
              21

               

            	
              THE
                AGENT, THE ARRANGERS AND THE LENDERS

               

            	
              45

               

            
	
              22

               

            	
              NOTICES

               

            	
              51

               

            
	
              23

               

            	
              WAIVERS
                AND AMENDMENTS

               

            	
              52

               

            
	
              24

               

            	
              COSTS
                AND EXPENSES

               

            	
              52

               

            
	
              25

               

            	
              INDEMNITIES

               

            	
              53

               

            
	
              26

               

            	
              ALTERATION
                TO THE PARTIES

               

            	
              54

               

            
	
              27

               

            	
              SET
                OFF

               

            	
              58

               

            
	
              28

               

            	
              MISCELLANEOUS
                PROVISIONS

               

            	
              59

               

            
	
              29

               

            	
              GOVERNING
                LAW AND JURISDICTION

               

            	
              59

               

            
	
              30

               

            	
              TREATMENT
                OF CERTAIN INFORMATION; CONFIDENTIALITY

               

            	
              60

               

            
	
              31

               

            	
              THIRD
                PARTY RIGHTS

               

            	
              62

               

            
	
              32

               

            	
              WAIVER
                OF TRIAL BY JURY

               

            	
              62

               

            

    

    

    
      
        
        

      

      
        -i-

        
          

        

      

      
        
        

      

    

     

    
      	
              SCHEDULE 1
                COMMITMENTS                                                                                                                               

               

            	
               

               

            
	
              SCHEDULE 2
                INDEBTEDNESS AND
                LIENS                                                                                                                               

               

            	
               

            
	
              Part A
                Indebtedness                                                                                                                            

               

            	
               

            
	
              Part B
                Liens                                                                                                                            

               

            	
               

               

            
	
              SCHEDULE 3
                SUBSIDIARIES                                                                                                                               

               

            	
               

               

            
	
              SCHEDULE 4
                MANDATORY COSTS
                RATE                                                                                                                               

               

            	
               

            
	
              SCHEDULE 5
                CONDITIONS
                PRECEDENT                                                                                                                               

               

            	
               

               

            
	
              SCHEDULE 6
                UTILISATION
                REQUEST                                                                                                                               

               

            	
               

               

            
	
              SCHEDULE 7
                FORM OF LETTER OF
                CREDIT                                                                                                                               

               

            	
               

            
	
              SCHEDULE 8
                FORM OF TRANSFER
                CERTIFICATE                                                                                                                               

               

            	
               

               

            
	
              SCHEDULE 9
                FORM OF CHARGE
                AGREEMENT                                                                                                                               

               

            	
               

               

            

    

    
      
        
        

      

      
        -ii-

        
          

        

      

      
        
        

      

    

    
 

    LETTER
      OF CREDIT FACILITY AND REIMBURSEMENT AGREEMENT dated 14 November 2007 (this
Agreement)

     

    Between:

     

    
      	
              (1)

            	
              XL
                CAPITAL LTD, a company incorporated under the laws of the Cayman
                Islands (the Account
                Party);

            

    

     

    
      	
              (2)

            	
              The
                GUARANTORS as defined
                below;

            

    

     

    
      	
              (3)

            	
              The
                LENDERS as defined
                below;

            

    

     

    
      	
              (4)

            	
              CITIBANK
                INTERNATIONAL PLC, as agent and trustee for the Lenders (and when
                acting in such capacities the Agent and
                Security Trustee respectively);
                and

            

    

     

    
      	
              (5)

            	
              CITIGROUP
                GLOBAL MARKETS LIMITED, LLOYDS TSB BANK PLC and THE ROYAL
                BANK OF SCOTLAND PLC as mandated lead
                arrangers (the
                Arrangers).

            

    

     

    
      	
              1.

            	
              DEFINITIONS

            

    

     

    Defined
      Terms

     

    1.1           As
      used in this Agreement, the following terms have the meanings specified
      below:

     

    Acceleration
      Event means the provision by the Agent to the Account Party of an
      Acceleration Notice and/or the occurrence of any event with respect to any
      Obligor described in Clause 20(e) or20(f);

     

    Acceleration
      Notice has the meaning assigned to such term in Clause
      20;

     

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

     

    AMBCash
      Collateral has the meaning assigned to such term in Clause
      19.8;

     

    AMB
      Rating Undertaking has the meaning assigned to such term in Clause
      19.8;

     

    Applicable
      Percentage means, with respect to any Lender, the percentage of
      the Total Commitments represented by such Lender’s Commitment. If the Total
      Commitments or Commitment of a Lender have terminated or expired, the Applicable
      Percentage shall be determined based upon the Total Commitments or Commitment
      of
      such Lender (as the case may be) most recently in effect, giving effect to
      any
      permitted assignments or transfers;

     

    Applicant
      means each of Mid Ocean, Stonebridge Underwriting, NAC
      Reinsurance, Dornoch, County Down, XL London Market and XL Re and any other
      Affiliate of the Account Party as may be agreed by the Agent and the Account
      Party from time to time;

     

    Approved
      Credit Institution means a credit institution within the meaning
      of the First Council Directive on the co-ordination of laws, regulations and
      administrative provisions relating to the taking up and pursuit of the business
      of credit institutions (No 77/780/EEC) which has been approved by Lloyd’s
      for the purpose of providing guarantees and issuing or confirming letters of
      credit comprising a member’s Funds at Lloyd’s;

     

    Authorised
      Signatory means, in relation to an Obligor, any person who is duly
      authorised (in such manner as may be reasonably acceptable to the Agent) and
      in
      respect of whom the Agent has received a certificate signed by a director or
      another Authorised Signatory of such Obligor setting out the name and signature
      of such person and confirming such person’s authority to act;

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Available
      Commitment means in relation to a Lender at any time and save as
      otherwise provided herein its Commitment less the amount of its participation
      in
      the LC Exposures at such time PROVIDED THAT such amount
      shall not be less than zero;

     

    Available
      Facility means, at any time, the aggregate of the Available
      Commitments adjusted, in the case of a proposed utilisation pursuant to a
      Utilisation Request, so as to take into account:

     

    
      	
              (a)

            	
              any
                reduction in the Commitment of a Lender pursuant to the terms hereof;
                and

            

    

     

    
      	
              (b)

            	
              any
                Letter of Credit which pursuant to any other Utilisation Request
                is to be
                issued;

            

    

     

    on
      or
      before the proposed Utilisation Date relating to such utilisation;

     

    Availability
      Period means the period from (and including) the Closing Date to
      (and including) the Commitment Termination Date;

     

    Bilateral
      Letter of Credit has the meaning given to it in
      Clause 4.5(b);

     

    BIS
      Qualifying Assets means fixed income securities issued or
      guaranteed by US Government Agencies or by the Central Governments of any OECD
      country having a financial strength rating of at least “A+” from Standard &
Poor’s Rating Services (or its successor);

     

    Board
      means the Board of Governors of the Federal Reserve System of the United States
      of America;

     

    Business
      Day means any day that is not a Saturday, Sunday or other day on
      which commercial banks in New York City, London or Bermuda are authorised or
      required by Law to remain closed;

     

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

     

    Central
      Government means, without limitation, government departments,
      ministries and central banks;

     

    Change
      in
      Control
      means the occurrence of any of the following events or
      conditions:

     

    
      	
              (a)

            	
              any
                Person, including any syndicate or group deemed to be a Person under
                Section 13(d)(3) of the Securities Exchange Act of 1934, as amended,
                acquires beneficial ownership, directly or indirectly, through a
                purchase,
                merger or other acquisition transaction or series of transactions,
                of
                shares of capital stock of the Account Party entitling such Person
                to
                exercise 40% or more of the total voting power of all shares of capital
                stock of the Account Party that is entitled to vote generally in
                elections
                of directors, other than an acquisition by the Account Party, any
                of its
                subsidiaries or any employee benefit plans of the Account Party;
                or

            

    

     

    
      	
              (b)

            	
              the
                Account Party merges or consolidates with or into any other Person
                (other
                than a Subsidiary), another person (other than a subsidiary) merges
                into
                the Account Party or the Account Party conveys, sells, transfers
                or leases
                all or substantially all of its assets to another Person (other than
                a
                Subsidiary), other than any transaction: (i) that does not result
                in a
                reclassification, conversion, exchange or cancellation of the outstanding
                shares of capital stock of the Account Party (other than the cancellation
                of any outstanding shares of capital stock of the Account Party held
                by
                the Person with whom it merges or consolidates) or (ii) which is
                effected
                solely to change the jurisdiction of incorporation of the Account
                Party
                and results in a reclassification, conversion or exchange of outstanding
                shares of capital stock of the Account Party solely into shares of
                capital
                stock of the surviving entity; or

            

    

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

    
      	
              (c)

            	
              a
                majority of the members of the Account Party’s board of directors are
                persons who are then serving on the board of directors without having
                been
                elected by the board of directors or having been nominated for election
                by
                its shareholders.

            

    

     

    Change
      in Law means (a) the adoption of any Law, rule or regulation after
      the date of this Agreement, (b) any change in any Law, rule or regulation or
      in
      the interpretation or application thereof by any Governmental Authority after
      the date of this Agreement or (c) compliance by any Lender (or, for purposes
      of
      Clause 0 and 0, by any lending office of such Lender or by such Lender’s
      holding company, if any) with any request, guideline or directive (whether
      or
      not having the force of Law) of any Governmental Authority made or issued after
      the date of this Agreement;

     

    Charge
      Agreement means the charge agreement, in substantially the form
      set out in 9 that may be required to be entered into by the Account Party as
      chargor pursuant to the terms hereof and pursuant to which the Account Party
      will grant cash cover in favour of the Security Trustee;

     

    Closing
      Date means the later of 3 Business Days from the date hereof and
      the date on which the conditions set out in Schedule 5 (Conditions
      Precedent) have, in the reasonable opinion of the Agent, been
      satisfied;

     

    Code
      means the Internal Revenue Code of 1986 of the United States of America, as
      amended from time to time;

     

    Commencement
      Date means, in respect of a Letter of Credit, the date upon which
      a Letter of Credit shall become effective being any date from (and including)
      the Closing Date to (and including) the Commitment Termination
      Date;

     

    Commitment
      means, with respect to each Lender, the commitment of such Lender to participate
      in the issue of Letters of Credit hereunder. The initial amount of each Lender’s
      Commitment is set forth on Schedule 1, or in the Transfer Certificate pursuant
      to which such Lender shall have assumed its Commitment, as applicable, but
      in
      each case as such Commitment may be:

     

    
      	
              (a)

            	
              reduced
                from time to time pursuant to Clause 8 (Termination and Reduction
                of the Commitments) or Clause 4.5(b) (Replacement Letters of
                Credit); and

            

    

     

    
      	
              (b)

            	
              reduced
                or increased from time to time pursuant to assignments by or to such
                Lender pursuant to Clause 26.3 (Transfers by
                Lenders);

            

    

     

    Commitment
      Letter means the letters so titled from the Arrangers to the
      Account Party dated 28 September 2007;

     

    Commitment
      Termination Date means 30 November 2008;

     

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

     

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

     

    County
      Down means County Down Limited, a company incorporated under the
      laws of England and Wales;

     

    Default
      means any event or condition which constitutes an Event of Default or a
      Potential Event of Default;

     

    
      
        
        

      

      
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    Default
      Period means the period from and including the date on which the
      Agent makes payment of a Demand Amount to but excluding the date on which the
      Account Party makes a corresponding reimbursement under Clause 6.1(a) and
      (b) (The Account Party’s Indemnity to Lenders);

     

    Demand
      Amount means a principal amount to be paid by the Account Party
      pursuant to Clause 6.1(a) and (b) (The Account Party’s Indemnity to
      Lenders);

     

    Dollars
      or $ refers to the lawful money of the United States
      of America from time to time;

     

    Dornoch
      means Dornoch Limited, a company incorporated under the laws
      of
      England and Wales;

     

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

     

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

     

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

     

    ERISA
      means the Employee Retirement Income Security Act of 1974 of the United States
      of America, as amended from time to time;

     

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

     

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

     

    Event
      of Default has the meaning assigned to such term in Clause
      20;

     

    Exempt
      Indebtedness means any Indebtedness of any Person (other than the
      Account Party or any of its Affiliates) that is consolidated on the balance
      sheet of the Account Party and its consolidated Subsidiaries in accordance
      with

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

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

     

    Facility
      means the letter of credit facility granted to the Account Party pursuant to
      this Agreement;

     

    Facility
      Office means the office or offices notified by a Lender to the
      Agent in writing on or before the date it becomes a Lender (or, following that
      date, by not less than five Business Days’ written notice) as the office or
      offices through which it will perform its obligations under this
      Agreement;

     

    Fee
      Letter means the letter from the Arrangers to the Account Party
      dated 28 September 2007, relating to the payment of certain fees;

     

    Finance
      Documents means this Agreement, the Charge Agreement, the
      Commitment Letter, the Fee Letter, any Letter of Credit and any other document
      or documents as may be agreed by the Agent and the Account Party;

     

    Final
      Expiration Date means the date on which a Letter of Credit
      terminates in accordance with its terms;

     

    Finance
      Parties means the Lenders, the Agent, the Arrangers and the
      Security Trustee;

     

    Financial
      Officer means, with respect to any Obligor, a principal financial
      officer of such Obligor;

     

    Financial
      Strength Rating has the meaning assigned to such term in Clause
      9.3.

     

    Funds
      at Lloyd’s has the meaning given to it in paragraph 4 of the
      Membership Bylaw (No. 17 of 1993);

     

    Funds
      at Lloyd’s Requirements means, in respect of any member, the
      amount required to be maintained by that member as Funds at
      Lloyd’s;

     

    Funds
      Date means the date notified by Lloyd’s each year as being the
      latest date in that year by which Funds at Lloyd’s can be placed with Lloyd’s in
      order to satisfy Funds at Lloyd’s Requirements in respect of the immediately
      succeeding calendar year;

     

    GAAP
      means generally accepted accounting principles in the United States of
      America;

     

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

     

    Governmental
      Authority means the government of the United Kingdom, or of any
      other nation, or any political subdivision thereof, whether state or local,
      and
      any agency, authority, instrumentality, regulatory body, court, central bank
      or
      other entity exercising executive, legislative, judicial, taxing, regulatory
      or
      administrative powers or functions of or pertaining to government;

     

    Guarantee
      means, with respect to any Person, without duplication, any obligations of
      such
      Person (other than endorsements in the ordinary course of business of negotiable
      instruments for deposit or collection) guaranteeing or intended to guarantee
      any
      Indebtedness of any other Person in any manner, whether direct or indirect,
      and
      including without limitation any obligation, whether or not contingent, (i)
      to
      purchase any such Indebtedness or any property constituting security therefor
      for the purpose of assuring the holder of such Indebtedness, (ii) to advance
      or
      provide funds or other support for the payment or purchase of any such
      Indebtedness or to maintain working capital, so

     

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

    vency
      or
      other balance sheet condition of such other Person (including without limitation
      keepwell agreements, maintenance agreements, comfort letters or similar
      agreements or arrangements) for the benefit of any holder of Indebtedness of
      such other Person, (iii) to lease or purchase property, securities or services
      primarily for the purpose of assuring the holder of such Indebtedness, or (iv)
      to otherwise assure or hold harmless the holder of such Indebtedness against
      loss in respect thereof. The amount of any Guarantee hereunder shall (subject
      to
      any limitations set forth therein) be deemed to be an amount equal to the
      outstanding principal amount of the Indebtedness in respect of which such
      Guarantee is made.  The terms Guarantee and
Guaranteed used as a verb shall
      have a correlative
      meaning;

     

    Guarantors
      means each of the Account Party, XL America, XL Insurance, and XL
      Re;

     

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

     

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

     

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

     

    Insurance
      Subsidiary means any Subsidiary which is subject to the regulation
      of, and is required to file statutory financial statements with, any
      governmental body, agency or official in any State or territory of the United
      States or the District of Columbia which regulates insurance companies or the
      doing of an insurance business therein;

     

    ISDA
      has the meaning assigned to such term in Clause 19.3(f);

     

    Issuing
      Lender means any Lender in its capacity as an issuer of one or
      more Letters of Credit hereunder;

     

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

     

    LC
      Disbursement means a payment made by a Lender pursuant to a Letter
      of Credit;

     

    LC
      Exposure means the sum of (a) the aggregate undrawn amount of all
      outstanding Letters of Credit at such time plus (b) the aggregate amount of
      all
      Demand Amounts. The LC Exposure of any Lender at any time shall be the sum
      of
      its participation in the outstanding Letters of Credit at such time and the
      Demand Amounts owed to it at such time;

     

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

    LC
      Proportion means, in relation to the Lender in respect of any
      Letter of Credit and save as otherwise provided herein, the proportion
      (expressed as a percentage) of such Lender’s Available Commitment to the
      Available Facility immediately prior to the issue of such Letter of
      Credit;

     

    Lender
      Affiliate means with respect to any Lender, (a) an Affiliate of
      such Lender or (b) any entity (whether a corporation, partnership, trust or
      otherwise) that is engaged in making, purchasing, holding or otherwise investing
      in bank loans and similar extensions of credit in the ordinary course of its
      business and is administered or managed by a Lender or an Affiliate of such
      Lender;

     

    Lenders
      means any of the Persons listed in Schedule 1 (Commitments) or any
      other Person that shall have become a party hereto pursuant to Clause 26.3
      (Transfers by Lenders), and which has not ceased to be a party hereto
      in accordance with the terms hereof;

     

    Letters
      of Credit means Letters of Credit issued pursuant to the terms of
      this Agreement (including, for the avoidance of doubt, any New Letter of Credit,
      Reduced Letter of Credit or Bilateral Letter of Credit referred to in Clause
      4.5
      (Replacement Letters of Credit));

     

    Letter
      of Credit Fees means the fees payable by the Account Party
      pursuant to Clause 9.2 (Letter of Credit Fees) (as adjusted from
      time to time in accordance with the provisions of Clause 9.3) (Adjustment of
      Letter of Credit Fee);

     

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

     

    LIBOR
      means, in relation to any unpaid sum:

     

    (a)           the
      rate appearing on Reuters Page LIBOR0l at or about 11:00 a.m. on any relevant
      day; or

     

    (b)           if
      the display rate cannot be determined under paragraph (a) above, the rate
      determined by the Agent to be the arithmetic mean (rounded if necessary, to
      the
      nearest five decimal places with the midpoint rounded upwards) of the rates
      notified to the Agent by each of the Reference Banks quoting (provided that
      at
      least two Reference Banks are quoting) as the rate at which such Reference
      Bank
      is offering overnight deposits in the required currency in an amount comparable
      to that amount to prime banks in the London Interbank Market at or about 11.00
      a.m. on any relevant day; and

     

    for
      the
      purposes of this definition: Reuters Page LIBOR0l
      means the display designated as Reuters Page LIBOR0l on the Reuters service or
      such other service as may be nominated by the British Bankers’ Association as
      the information vendor for the purposes of displaying British Bankers’
Association Interest Settlement Rates for deposits in the currency
      concerned);

     

    Lloyd’s
      means the society incorporated by Lloyd’s Act 1871 by the name of
      Lloyd’s;

     

    Majority
      Lenders means, at any time, Lenders having Commitments
      representing more than 50% of the sum of the total Commitments at such time;
      PROVIDED THAT, if the Commitments have expired or been
      terminated, Majority Lenders means Lenders having more
      than 50% of the aggregate LC Exposure of the Lenders;

     

    Mandatory
      Costs means, in relation to any unpaid sum for any period, a rate
      per annum calculated in accordance with Schedule 4;

     

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

     

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

     

    
      
        
        

      

      
        -7-

        
          

        

      

      
        
        

      

    

    Mid
      Ocean means Mid Ocean Limited, a company incorporated under the
      laws of the Cayman Islands;

     

    Multiemployer
      Plan means a multiemployer plan as defined in Clause 4001(a)(3) of
      ERISA;

     

    NAC
      Reinsurance means NAC Reinsurance International Ltd, a company
      incorporated under the laws of England and Wales;

     

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

     

    Obligor
      Jurisdiction means (a) Bermuda, (b) the Cayman Islands, (c) United
      States, and (d) any other country (i) where any Obligor is licensed or qualified
      to do business or (ii) from or through which payments hereunder are made by
      any
      Obligor;

     

    Obligors
      means each of the Account Party and the Guarantors;

     

    OECD
      Country means any member of the Organisation for Economic
      Co-operation and Development;

     

    Original
      Agreement means the letter of credit and reimbursement agreement
      dated 14 March 2006, as amended, between, inter alios, the Account Party, the
      Agent and the lenders thereto;

     

    Original
      Letters of Credit means the letters of credit issued under the
      Original Agreement;

     

    Original
      Parties means the parties to the Original Agreement;

     

    Participating
      Member State means any member state of the European Communities
      that adopts or has adopted the euro as its lawful currency in accordance with
      legislation of the European Union relating to European Monetary
      Union;

     

    Party
      means any party to this Agreement;

     

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

     

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

     

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

     

    Potential
      Event of Default means an event or condition which upon notice,
      lapse of time or both would, unless cured or waived, become an Event of
      Default;

     

    Private
      Act means separate legislation enacted in Bermuda with the
      intention that such legislation apply specifically to an Obligor, in whole
      or in
      part;

     

    Process
      Agent has the meaning assigned to such term in Clause
      29.3.

     

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

     

    
      
        
        

      

      
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    Reference
      Banks means, subject to Clause 26.6 (Reference
      Banks), the principal London offices of Citigroup Global Markets Limited,
      Lloyds TSB Bank plc and The Royal Bank of Scotland plc;

     

    Register
      has the meaning given to it in Clause 26.11 (Maintenance of Register by
      Agent);

     

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

     

    Representations
      means each of the representations and warranties set out in
      Clause 17 (Representations and Warranties);

     

    SAP
      means, as to each Obligor and each Subsidiary that offers insurance products,
      the statutory accounting practices prescribed or permitted by the relevant
      Governmental Authority for such Obligor’s or such Subsidiary’s domicile for the
      preparation of its financial statements and other reports by insurance
      corporations of the same type as such Obligor or such Subsidiary in effect
      on
      the date such statements or reports are to be prepared, except if otherwise
      notified by the Account Party as provided in Clause 1.3;

     

    SEC
      means the Securities and Exchange Commission of the United States of America
      or
      any successor entity;

     

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

     

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

     

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

     

    Sterling
      or £ refers to the lawful currency of
      the United Kingdom from time to time;

     

    Stonebridge
      Underwriting means Stonebridge Underwriting Limited, a company
      incorporated under the laws of England and Wales;

     

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

     

    Substitute
      Lender has the meaning give to it in
      Clause 4.4(a);

     

    
      
        
        

      

      
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    Taxes
      means any and all present or future taxes, levies, imposts, duties, deductions,
      charges or withholdings imposed by any Governmental
      Authority.  Taxation and
Tax shall be construed
      accordingly;

     

    Total
      Commitments means, at any time, the aggregate of the Lenders’
Commitments (being on the date hereof £450,000,000);

     

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

     

    Total
      LC Exposures means, at any time, the aggregate of the Lenders’ LC
      Exposures;

     

    Transactions
      means the execution, delivery and performance by the Obligors of this Agreement
      and the other Finance Documents to which any Obligor is intended to be a party
      and the issuance of Letters of Credit hereunder;

     

    Transfer
      Certificate means a certificate in the form of Schedule 8
      (Form of Transfer Certificate) delivered pursuant to Clause 26.4
      (Transfer Procedure);

     

    Transferee
      means a Person to which a Lender seeks to transfer by novation all or part
      of
      such Lender’s rights, benefits and obligations under the Finance
      Documents;

     

    USA
      Patriot Act has the meaning given to such term as set out in
      Clause 28.6;

     

    US
      Government Agencies means US government agencies whose debt
      obligations are fully and explicitly guaranteed as to the timely repayment
      of
      principal and interest by the full faith and credit of the US federal
      government;

     

    Utilisation
      Date means the date on which a Letter of Credit is to be
      issued;

     

    Utilisation
      Request means a notice substantially in the form set out in
      Schedule 6 (Form of Utilisation Request);

     

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

     

    XL
      America means X.L. America, Inc., a company incorporated under the
      laws of Delaware, USA;

     

    XL
      Capital Group means the XL Capital Group as determined from time
      to time by A.M. Best & Co;

     

    XL
      Insurance means XL Insurance (Bermuda) Ltd, a company organised
      under the laws of Bermuda;

     

    XL
      London Market means XL London Market Ltd (formerly known as
      Brockbank), a company incorporated under the laws of England and
      Wales;

     

    XL
      Re means XL Re Ltd, a company organised under the laws of
      Bermuda.

     

    Interpretation

     

    1.2           Any
      reference in this Agreement to:

     

    
      	
              (a)

            	
              the
                Agent, Security Trustee,
                Arrangers,Lender or any other
                Person shall be construed so as to include its and any subsequent
                successors and permitted transferees in accordance with their respective
                interests;

            

    

     

    
      	
              (b)

            	
              continuing,
                in the context of an Event of Default shall be construed as a reference
                to
                an Event of Default which has not been remedied or waived in accordance
                with the terms hereof and in relation to a
                Potential

            

    

     

    
      
        
        

      

      
        -10-

        
          

        

      

      
        
        

      

    

    
      	
               

            	
              Event
                of Default, one which has not been remedied within the
                relevant grace period or waived in accordance with the terms
                hereof;

            

    

     

    
      	
              (c)

            	
              a
                holding company of a company or corporation
                shall be construed as a reference to any company or corporation of
                which
                the first-mentioned company or corporation is a
                subsidiary;

            

    

     

    
      	
              (d)

            	
              the
                equivalent on any date in one currency (the
                first currency) of an amount denominated in
                another currency (the second currency) is a
                reference to the amount of the first currency which could be purchased
                with the amount of the second currency at the spot rate quoted by
                the
                Agent at or about 11.00 a.m. on such date for the purchase of the
                first
                currency with the second currency;

            

    

     

    
      	
              (e)

            	
              a
                member shall be construed (as the context may
                require) as a reference to an underwriting member of
                Lloyd’s;

            

    

     

    
      	
              (f)

            	
              a
                month is a reference to a period starting
                on one
                day in a calendar month and ending on the numerically corresponding
                day in
                the next succeeding calendar month save that, where any such period
                would
                otherwise end on a day which is not a Business Day, it shall end
                on the
                next succeeding Business Day, unless that day falls in the calendar
                month
                succeeding that in which it would otherwise have ended, in which
                case it
                shall end on the immediately preceding Business Day, PROVIDED
                THAT, if a period starts on the last Business Day in a calendar
                month or if there is no numerically corresponding day in the month
                in
                which that period ends, that period shall end on the last Business
                Day in
                that later month (and references to months shall
                be construed accordingly);

            

    

     

    
      	
              (g)

            	
              a
                Lender’s participation, in relation to a Letter
                of Credit, shall be construed as a reference to the rights and obligations
                of such Lender in relation to such Letter of Credit as are expressly
                set
                out in this Agreement;

            

    

     

    
      	
              (h)

            	
              a
                successor shall be construed so as to include
                an
                assignee or successor in title of such party and any person who under
                the
                laws of its jurisdiction of incorporation or domicile has assumed
                the
                rights and obligations of such party under this Agreement or to which,
                under such laws, such rights and obligations have been
                transferred;

            

    

     

    
      	
              (i)

            	
              an
                asset or property
                shall be construed to have the same meaning and effect and to refer
                to any
                and all tangible and intangible assets and properties, including
                cash,
                securities, accounts and contract
                rights;

            

    

     

    
      	
              (j)

            	
              tax
                shall be construed so as to include any and all present or future
                stamp or
                documentary taxes or any other excise or property taxes, charges,
                interest, penalties or similar levies arising from any payment made
                hereunder or from the execution, delivery or enforcement of, or otherwise
                with respect to, this Agreement;

            

    

     

    
      	
              (k)

            	
              VAT
                shall be construed as a reference to value added tax including any
                similar
                tax which may be imposed in place thereof from time to
                time;

            

    

     

    
      	
              (l)

            	
              the
                winding-up,
                dissolution or
                administration of a company or corporation shall
                be construed so as to include any equivalent or analogous proceedings
                under the Law of the jurisdiction in which such company or corporation
                is
                incorporated or any jurisdiction in which such company or corporation
                carries on business including the seeking of liquidation, winding-up,
                reorganisation, dissolution, administration, arrangement, adjustment,
                protection or relief of debtors;
                and

            

    

     

    
      	
              (m)

            	
              unless
                the contrary intention appears:

            

    

     

    
      	
               

            	
              (i)

            	
              a
                Letter of Credit is cancelled,
                repaid or prepaid
                by:

            

    

     

    
      	
               

            	
              (A)

            	
              providing
                the Issuing Lender(s) with cash cover (as defined below);
                or

            

    

     

    
      
        
        

      

      
        -11-

        
          

        

      

      
        
        

      

    

    
      	
               

            	
              (B)

            	
              reducing
                (in accordance with the terms of this Agreement and the Letter of
                Credit)
                the amount that may be demanded under the Letter of Credit (or by
                that
                amount automatically reducing in accordance with the terms of the
                Letter
                of Credit); or

            

    

     

    
      	
               

            	
              (C)

            	
              cancelling
                the Letter of Credit by (x) providing written confirmation (in form
                and substance satisfactory to the Agent or the Issuing Lender) from
                Lloyd’s that the Issuing Lender(s) has no further liability under the
                Letter of Credit (including by way of a notice specifying that Lloyd’s
                does not accept or unconditionally rejects a Letter of Credit (unless
                the
                Agent or the Issuing Lender as the case may be, acting reasonably,
                considers that Lloyd’s remains entitled to make a claim under such Letter
                of Credit)), and (y) if Lloyd’s agrees, by procuring the return of
                the original to the Agent;

            

    

     

    
      	
               

            	
              (ii)

            	
              cash
                cover is provided, pursuant to the terms of the Charge
                Agreement, in respect of a Lender’s participation in a Letter of Credit at
                any time by paying an amount in Sterling equal to the outstanding
                amount
                of that participation at that time to such account or accounts as
                the
                Agent may specify and creating effective security over such amount
                in
                favour of the Security Trustee on behalf of the Finance Parties in
                form
                and substance satisfactory to the Security Trustee (together with
                legal
                opinions, evidence of corporate authorisation, and similar documentation
                reasonably required by the Security Trustee), in the name of the
                Account
                Party from which the only withdrawals which may be made are withdrawals
                made with the prior written consent of the Security Trustee in accordance
                with the terms of the Charge Agreement;
                and

            

    

     

    
      	
               

            	
              (iii)

            	
              a
                reference to principal amount in respect of a
                Letter of Credit means the maximum amount which is expressed to be
                capable
                of being demanded under a Letter of Credit ignoring the aggregate
                amount
                of any cash cover held in relation to that Letter of
                Credit.

            

    

     

    Accounting
      Terms; GAAP and SAP

     

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

     

    Agreements
      and Statutes

     

    1.4           Any
      reference in this Agreement to:

     

    
      	
              (a)

            	
              this
                Agreement or any other agreement or document shall be construed as
                a
                reference to this Agreement or, as the case may be, such other agreement
                or document as the same may have been, or may from time to time be,
                amended, varied, novated or
                supplemented;

            

    

     

    
      	
              (b)

            	
              a
                statute or treaty shall be construed as a reference to such statute
                or
                treaty as the same may have been, or may from time to time be, amended
                or,
                in the case of a statute, re-enacted;
                and

            

    

     

    
      	
              (c)

            	
              a
                bylaw shall be construed as a reference to a bylaw made under Lloyd’s Acts
                1871 to 1982 as the same may have been, or may from time to time
                be,
                amended or replaced.

            

    

     

    
      
        
        

      

      
        -12-

        
          

        

      

      
        
        

      

    

    
      	
               

            	
              Headings

            

    

     

    1.5           Clause
      and Schedule headings are for ease of reference only.

     

    Time

     

    1.6           Any
      reference in this Agreement to a time of day shall, unless a contrary indication
      appears, be a reference to London time.

     

    2.           THE
      FACILITY

     

    Grant
      of the Facility

     

    2.1           The
      Lenders, upon the terms and subject to other conditions hereof, grant to the
      Account Party a letter of credit facility in an aggregate amount of
£450,000,000.

     

    Purpose
      and Application

     

    
      	
              2.2
                (a)

            	
              The
                Facility is intended to support Funds at Lloyd’s for the underwriting
                business of the Applicants, and, accordingly, the Account Party shall
                apply all Letters of Credit issued hereunder in or towards satisfaction
                of
                such purpose.

            

    

     

    
      	
              (b)

            	
              Without
                prejudice to the Account Party’s obligations under Clause 2.2(a) and
                the remaining provisions of this Agreement, none of the Finance Parties
                shall be bound to enquire as to, nor shall any of them be responsible
                for,
                the purpose of, or application of the proceeds of any Letter of Credit
                issued hereunder.

            

    

     

    Conditions
      Precedent

     

    2.3           Save
      as the Lenders may otherwise agree, the Account Party may not deliver any
      Utilisation Request unless the Agent has confirmed to the Account Party and
      the
      Lenders that it has waived and/or received all of the documents and other
      evidence listed in Schedule 5 (Conditions Precedent) and that each is,
      in form and substance, reasonably satisfactory to the Agent.

     

    Several
      Obligations

     

    2.4           The
      obligations of each Lender are several and the failure by a Lender to perform
      its obligations hereunder and/or under any Letter of Credit issued hereunder
      shall not affect the obligations of either Obligor towards any other party
      hereto nor shall any other party be liable for the failure by such Lender to
      perform its obligations hereunder and/or under such Letter of
      Credit.

     

    Several
      Rights

     

    2.5           The
      rights of each Finance Party are several and any debt arising hereunder at
      any
      time from an Obligor to any Finance Party shall be a separate and independent
      debt.  Each such party shall be entitled to protect and enforce its
      individual rights arising out of this Agreement independently of any other
      party
      (so that it shall not be necessary for any party hereto to be joined as an
      additional party in any proceedings for this purpose).

     

    Change
      of Currency

     

    
      	
              2.6
                (a)

            	
              If,
                after the date of this Agreement, more than one currency or currency
                unit
                denomination are at the same time recognised by the central bank
                of any
                country as the lawful currency of that country,
                then:

            

    

     

    
      
        
        

      

      
        -13-

        
          

        

      

      
        
        

      

    

    
      	
               

            	
              
                (i)    any
                  reference in the Finance Documents to, and any obligations arising
                  under
                  the Finance Documents in, the currency of that country shall be
                  translated
                  into, or paid in, the currency or currency unit of that country
                  designated
                  by the Agent; and

              

            

    

     

    
      	
               

            	
              (ii)

            	
              any
                translation from one currency or currency unit to another shall be
                at the
                official rate of exchange or conversion rate recognised by the central
                bank for the conversion of that currency or currency unit into the
                other,
                rounded up or down by the Agent acting
                reasonably.

            

    

     

    
      	
              (b)

            	
              If
                a change in any currency of a country occurs, this Agreement will
                be
                amended in the manner determined by the Agent (acting reasonably)
                so as to
                reflect the change in currency and to place the parties in the same
                position, so far as possible, that they would have been in if no
                change in
                currency had occurred.

            

    

     

    Cancellation
      of Original Agreement

     

    
      	
              2.7
                (a)

            	
              From
                the date of this Agreement the Account Party shall not deliver any
                Utilisation Request (as defined in the Original Agreement) under
                the
                Original Agreement.

            

    

     

    
      	
              (b)

            	
              The
                Original Parties hereby agree that the Original Agreement shall be
                automatically terminated and the Total Commitments thereunder cancelled
                upon cancellation of all the Original Letters of Credit in accordance
                with
                the terms of the Original
                Agreement.

            

    

     

    
      	
              (c)

            	
              The
                letter of credit fees payable by the Account Party in respect of
                any
                Original Letter of Credit shall, from the date hereof until any such
                Original Letter of Credit is cancelled, accrue at the rate set out
                in
                clause 9.2(a) (Letter of Credit
                Fee).

            

    

     

    3.           UTILISATION
      OF THE FACILITY

     

    Utilisation
      Conditions for the Facility

     

    3.1           Save
      as otherwise provided herein, a Letter of Credit will be issued at the request
      of the Account Party on behalf of an Applicant if:

     

    
      	
              (a)

            	
              no
                later than 10.00 a.m. two Business Days before the proposed Utilisation
                Date, the Agent has received a duly completed Utilisation Request
                from the
                Account Party;

            

    

     

    
      	
              (b)

            	
              the
                proposed Utilisation Date is a Business Day falling within the
                Availability Period;

            

    

     

    
      	
              (c)

            	
              the
                proposed amount of such Letter of Credit is less than or equal to
                the
                Available Facility;

            

    

     

    
      	
              (d)

            	
              the
                Letter of Credit is substantially in the form set out in Schedule
                7
                (Form of Letter of Credit) or in such other form requested by the
                Account Party which is approved by Lloyd’s and the Lenders (such approval
                by the Lenders not to be unreasonably withheld or delayed and shall
                not be
                required unless the other form requested differs materially from
                the form
                set out in Schedule 7);

            

    

     

    
      	
              (e)

            	
              the
                beneficiary of such Letter of Credit is Lloyd’s;
                and

            

    

     

    
      	
              (f)

            	
              on
                and as of the proposed Utilisation Date (a) no Default has occurred
                and is
                continuing and (b) the Representations are true in all material
                respects.

            

    

     

    Request
      for Letters of Credit

     

    3.2           The
      Account Party may request the issue by the Lenders hereunder of a total of
      up to
      thirty Letters of Credit in respect of the Applicants.  A single
      Utilisation Request may be issued in respect of more than one Letter of
      Credit.

     

    
      
        
        

      

      
        -14-

        
          

        

      

      
        
        

      

    

    Completion
      of Letters of Credit

     

    3.3           The
      Agent is authorised to arrange for the issue of any Letter of Credit pursuant
      to
      Clause 3.1 (Utilisation Conditions for the Facility)
      by:

     

    
      	
              (a)

            	
              completing
                the Commencement Date of such Letter of
                Credit;

            

    

     

    
      	
              (b)

            	
              completing
                the schedule to such Letter of Credit with the percentage participation
                of
                each Lender as allocated pursuant to the terms hereof;
                and

            

    

     

    
      	
              (c)

            	
              executing
                such Letter of Credit on behalf of each Lender and following such
                execution delivering such Letter of Credit to Lloyd’s on the Utilisation
                Date.

            

    

     

    Final
      Expiration Date

     

    3.4           Each
      Letter of Credit shall expire on its Final Expiration Date.

     

    Each
      Lender’s Participation in Letters of Credit

     

    
      	
              3.5
                (a)

            	
              Save
                as otherwise provided herein, each Lender will participate in each
                Letter
                of Credit issued pursuant to this Clause 3 in the proportion borne
                by its
                Available Commitment to the Available Facility immediately prior
                to the
                issue of such Letter of Credit.

            

    

     

    
      	
              (b)

            	
              No
                Lender shall participate in or issue any Letter of Credit to the
                extent
                that its LC Exposure would exceed its Commitment following the issue
                of
                that Letter of Credit.

            

    

     

    Notification
      to Lenders

     

    3.6           On
      or before each Utilisation Date the Agent shall notify each Lender of the Letter
      of Credit that is to be issued by the Agent on behalf of the Lenders, the name
      of the Applicant in respect of whom the Letter of Credit is being issued and
      the
      aggregate principal amount of the relevant Letter of Credit allocated to such
      Lender pursuant to this Agreement.

     

    Cancellation
      of Available Commitments

     

    3.7           On
      the expiry of the Availability Period, the Available Facility and each Lender’s
      Available Commitment shall be reduced to zero and accordingly the remaining
      Commitments of each Lender shall be equal to their respective LC Exposure under
      any issued Letters of Credit.

     

    4.           TERMINATION
      OF LETTERS OF CREDIT

     

    Continuation
      until Lloyd’s Termination Date

     

    4.1           Each
      Party acknowledges that, subject to the terms of this Agreement:

     

    
      	
              (a)

            	
              each
                issued Letter of Credit shall continue in force unless Lloyd’s receives a
                notice from the Agent (or any Finance Party, if pursuant to Clause
                4.6(b))
                giving Lloyd’s not less than four years’ notice in writing, terminating
                such Letter of Credit pursuant to Clause 3 of the Letter of Credit
                (a
                Lloyd’s Termination
                Notice):

            

    

     

    
      	
               

            	
              (i)

            	
              on
                the later of (x) 31 December 2012 and (y) any subsequent date as
                specified
                in such notice (a Lloyd’sTermination
                Date); or

            

    

     

    
      	
               

            	
              (ii)

            	
              at
                any time after the occurrence of an Acceleration Event or whilst
                any
                Continuation CP Event (as defined in Clause 4.6(b)) is
                continuing;

            

    

     

    
      
        
        

      

      
        -15-

        
          

        

      

      
        
        

      

    

    
      	
              (b)

            	
               

            	
              no
                Party, other than the Agent (or any Lender, if pursuant to Clause
                4.6(b)),
                may deliver a Lloyd’s Termination Notice (and the Agent may only deliver a
                Lloyd’s Termination Notice pursuant to Clause 3 of the Letter of Credit
                and this Clause 4);

            

    

     

    
      	
              (c)

            	
              if
                the Account Party or any Lender (a Relevant
                Party) so requests (a Termination
                Request), the Agent shall deliver a Lloyd’s Termination
                Notice as required by this Clause 4, on the later
                of:

            

    

     

    
      	
               

            	
              (i)

            	
              the
                expiration of the period ending on the day three weeks after the
                corresponding Termination Request Receipt Date, as defined in Clause
                4.2(b); and

            

    

     

    
      	
               

            	
              (ii)

            	
              the
                expiration of any Declining Lender Notice Period, as defined in
                Clause 4.3(a);

            

    

     

    
      	
              (d)

            	
              the
                Agent shall, promptly after delivery by the Agent of a Lloyd’s Termination
                Notice, provide a copy of such Lloyd’s Termination Notice to each Lender
                (and shall inform the Account Party of the Lloyd’s Termination Date);
                and

            

    

     

    
      	
              (e)

            	
              a
                Letter of Credit will terminate on the Lloyd’s Termination
                Date.

            

    

     

    Delivery
      by a Relevant Party of a Termination Request

     

    4.2           A
      Termination Request may be delivered by a Relevant Party to the Agent in
      accordance with the following:

     

    
      	
              (a)

            	
              no
                Termination Request may be delivered before 1 January
                2008;

            

    

     

    
      	
              (b)

            	
              any
                Termination Request delivered on a date (a Termination Request
                Delivery Date) from 1 January 2008 to and including 30
                November 2008 will be deemed to have been received by the Agent on
                (a
                Termination Request Receipt Date) 30 November
                2008 and the corresponding Lloyd’s Termination Date shall be 31 December
                2012; and

            

    

     

    
      	
              (c)

            	
              from
                1 December 2008, any Termination Request Receipt Date will be the
                later of
                (i) 1 January 2009 and (ii) the corresponding Termination Request
                Delivery
                Date.

            

    

     

    Declining
      Lender Mechanics (on Delivery by a Lender of a Termination
      Request)

     

    
      	
              4.3
                (a)

            	
              If
                a Lender (a Declining Lender) delivers a
                Termination Request to the Agent:

            

    

     

    
      	
               

            	
              (i)

            	
              the
                Agent shall notify the Account Party accordingly within two Business
                Days
                thereafter; and

            

    

     

    
      	
               

            	
              (ii)

            	
              during
                the period ending on the day three weeks after the corresponding
                Termination Request Receipt Date (a Declining Lender Notice
                Period) the Account Party may designate a Substitute Lender
                as contemplated in Clause 4.4.

            

    

     

    
      	
              (b)

            	
              Unless
                a Substitute Lender has
                been designated pursuant to Clause 4.4 (in which case the provisions
                of
                Clause 4.5(a) shall apply) upon expiry of the Declining Lender Notice
                Period the Agent shall issue a Lloyd’s Termination
                Notice (in accordance with Clause 3 of the Letter of Credit)
                specifying a Lloyd’s Termination Date of the later of (i) 31 December
                2011 and (ii) the fourth anniversary of the date of that notice,
                whereupon the Letter of Credit will terminate on such Lloyd’s
                Termination Date.

            

    

     

    
      	
              (c)

            	
              Unless
                notice is given to the Agent as aforesaid each Lender will be deemed
                automatically to have agreed to continue its participation in each
                Letter
                of Credit.

            

    

     

     

    
      
        
        

      

      
        -16-

        
          

        

      

      
        
        

      

    

    Substitute
      Lender

     

    4.4
      (a)     If any Declining Lender delivers a Termination
      Request, the Account Party may designate by the date which falls no later than
      two Business Days before the end of the corresponding Declining Lender Notice
      Period an Approved Credit Institution (which may be an existing Lender or
      Lenders) (the Substitute Lender) which is willing to assume all of the
      rights and obligations of the Declining Lender in respect of its participation
      in the relevant Letter of Credit (the Old Letter of
      Credit).

     

    
      	
              (b)

            	
              If
                the Account Party has found a Substitute Lender it shall promptly
                notify
                the Agent and the Declining Lender thereof and shall use its best
                efforts
                to procure the release by Lloyd’s of the Old Letter of Credit (an
                Old Letter of Credit Release) from the Funds at
                Lloyd’s of the relevant Applicant.

            

    

     

    
      	
              (c)

            	
              The
                Declining Lender shall as soon as reasonably practicable after receipt
                of
                notice from the Account Party transfer its rights and obligations
                hereunder to the Substitute Lender in accordance with the provisions
                of
                Clause 26.3 (Transfers by
                Lenders).

            

    

     

    
      	
              (d)

            	
              The
                Substitute Lender shall pay to the Declining Lender all amounts then
                due
                and owing (and all fees accrued to but excluding the date of such
                transfer) to the Declining Lender in respect of its participation
                in the
                Old Letter of Credit.

            

    

     

    Replacement
      Letters of Credit

     

    
      	
              4.5
                (a)

            	
              If
                a Substitute Lender has become party hereto pursuant to Clause 4.4
                (Substitute Lender), then subject to the provisions of Clause 4.6
                (Continuation Conditions Precedent) the Lenders who are deemed to
                have agreed to the continuation of the Old Letter of Credit (the
                Extending Lenders) shall, together with the
                Substitute Lender, participate in, and issue as soon as reasonably
                practicable (on or immediately after the Old Letter of Credit Release),
                a
                new Letter of Credit (the New Letter of Credit)
                which shall (i) replace the Old Letter of Credit and  (ii) be in
                an amount equal to the Old Letter of Credit. If the New Letter of
                Credit
                has not been issued by the end of the Declining Lender Notice Period,
                Clause 4.5(b) shall apply (on the assumption, if not the case, that
                a
                Substitute Lender has not been found by the time specified in
                Clause 4.4(a)) and the Agent shall promptly deliver a Lloyd’s
                Termination Notice (in accordance with Clause 4.3 (Declining Lender
                Mechanics)).

            

    

     

    
      	
              (b)

            	
              If
                a Substitute Lender has not been found by the time specified in
                Clause 4.4(a), then the Account Party shall use its best efforts to
                procure an Old Letter of Credit Release, and on or immediately after
                such
                Old Letter of Credit Release (i) subject to the provisions of Clause
                4.6
                (Continuation Conditions Precedent), the Extending Lenders shall
                participate in, and issue as soon as reasonably practicable, a new
                Letter
                of Credit (the Reduced Letter of Credit) which
                shall (x) replace their participation in the Old Letter of Credit
                and (y)
                be in an amount equal to the Old Letter of Credit less
                the amount of the Declining Lender’s participation and (ii) the Declining
                Lender shall participate in a separate Letter of Credit (a
                Bilateral Letter of Credit) which shall (x)
                replace its participation in the Old Letter of Credit, (y) be in
                an amount
                equal to the Declining Lender’s participation in the Old Letter of Credit
                and (z) have a Final Expiration Date which is the Lloyd’s Termination Date
                designated pursuant to Clause 4.3 (Declining Lender
                Mechanics).

            

    

     

    Continuation
      Conditions Precedent

     

    
      	
              4.6
                (a)

            	
              On
                or prior to close of business on 1 September of each year (each,
                a
                Continuation CP Date), the Account Party shall
                promptly notify the Agent if (as of such Continuation CP
                Date):

            

    

     

    
      	
               

            	
              (i)

            	
              an
                Event of Default or Potential Event of Default occurs which is
                continuing;

            

    

     

    
      	
               

            	
              (ii)

            	
              any
                of the Representations cease to be correct in all material respects,
                or
                become misleading in any material respect;
                or

            

    

     

    
      	
               

            	
              (iii)

            	
              any
                Letter of Credit ceases solely to be used to support the relevant
                Applicant’s underwriting business at Lloyd’s which has been provided in
                accordance with the requirements of Lloyd’s applicable to
                it.

            

    

     

    
      
        
        

      

      
        -17-

        
          

        

      

      
        
        

      

    

    
      	
               

            	
              (b)

            	
              If
                on any Continuation CP Date any of the events specified in
                Clause 4.6(a) (each, a Continuation CP
                Event) has occurred and is continuing, then at any time
                thereafter (so long as any Continuation CP Event is
                continuing):

            

    

     

    
      	
               

            	
              (i)

            	
              the
                Agent may, and at the request of the Majority Lenders shall, issue
                a
                Lloyd’s Termination Notice (containing the earliest possible Lloyd’s
                Termination Date); and

            

    

     

    
      	
               

            	
              (ii)

            	
              any
                Lender shall be entitled to issue a Lloyd’s Termination Notice (containing
                the earliest possible Lloyd’s Termination Date) and such Lender shall
                promptly provide a copy of such Lloyd’s Termination Notice to the
                Agent,

            

    

     

    and
      the
      Agent shall, in each case, provide a copy of the Lloyd’s Termination Notice to
      the Account Party (and each other Lender) within two Business Days of the Agent
      (x) issuing a Lloyd’s Termination Notice (in the case of paragraph (i) above) or
      (y) receiving a copy of a Lloyd’s Termination Notice from a Lender (in the case
      of paragraph (ii) above).

     

    Cancellation
      of Bilateral Letters of Credit

     

    4.7           At
      any time after the issue of a Bilateral Letter of Credit by a Declining Lender
      the Account Party may give the Agent and the Declining Lender not less than
      fourteen days’ prior written notice of its intention to procure that the
      liability of the Declining Lender under such Letter of Credit is reduced to
      zero
      (whereupon it shall do so).

     

    Revised
      Letters of Credit

     

    4.8           In
      the event that the Funds at Lloyd’s Requirements of an Applicant changes at or
      around the time of any given Funds Date in terms of amount and/or the identity
      of the Applicant, subject to the approval of Lloyd’s and subject to each
      Lender’s LC Exposures under the Letters of Credit issued hereunder not being
      increased, the Lenders shall co-operate with the Account Party to ensure to
      the
      extent reasonably possible that the Letters of Credit provide for the revised
      Funds at Lloyd’s Requirements of the Applicants.

     

    Increase
      to Facility

     

    4.9           If
      at any time a Bilateral Letter of Credit is outstanding, the Account Party
      shall
      have the right to increase the size of the Facility by up to the principal
      amount of the Bilateral Letter of Credit(s) outstanding by introducing a new
      lender (which may be an existing Lender) and on terms that one or more
      outstanding Bilateral Letters of Credit having an aggregate principal amount
      at
      least equal to the increase are cancelled at the time the increase takes
      effect.  Each Lender agrees to execute any documentation giving effect
      to this increase and new lender provided that no such documentation may increase
      the Commitment of any Lender without the express consent of that Lender at
      the
      time such documentation is executed.

     

    5.           PAYMENT
      OF DEMANDS

     

    Disbursement
      Procedures

     

    
      	
              5.1
                (a)

            	
              The
                Agent shall, within a reasonable time following its receipt thereof,
                examine all documents purporting to represent a demand for payment
                under
                any Letter of Credit. The Agent shall promptly after such examination
                (and
                in any event by 12 noon on the Business Day immediately following
                receipt
                of such demand) (i) notify each of the Lenders and the Account Party
                by
                facsimile of such demand for payment and (ii) deliver to each Lender
                and
                the Account Party a copy of each document purporting to represent
                a demand
                for payment under such Letter of
                Credit.

            

    

     

    
      	
              (b)

            	
              With
                respect to any drawing properly made under a Letter of Credit, each
                Lender
                will make an LC Disbursement in respect of such Letter of Credit
                in
                accordance with its liability under such Letter of Credit and this
                Agreement, such LC Disbursement to be made to the account of the
                Agent
                most recently designated by

            

    

     

    
      
        
        

      

      
        -18-

        
          

        

      

      
        
        

      

    

    
      	
               

            	
              it
                for such purpose by notice to the Lenders within two Business Days
                of
                receipt of a demand for payment under such Letter of Credit by the
                Agent;

            

    

     

    
      	
              (c)

            	
              The
                Agent will and undertakes to each Lender that it
                will:

            

    

     

    
      	
               

            	
              (i)

            	
              make
                any such LC Disbursement available to Lloyd’s as the beneficiary of such
                Letter of Credit by promptly crediting the amounts so received from
                the
                Lenders, in like funds, to the account identified by Lloyd’s in connection
                with such demand for payment on the date following two Business Days
                after
                the receipt by the Agent of such demand;
                and

            

    

     

    
      	
               

            	
              (ii)

            	
              notify
                each Lender on the third Business Day after the receipt by the Agent
                of
                such demand for payment that it has credited such amounts to the
                account
                identified by Lloyd’s.

            

    

     

    
      	
              (d)

            	
              Promptly
                following any LC Disbursement by any Lender in respect of any Letter
                of
                Credit, the Agent will notify the Account Party of such LC Disbursement
                provided that any failure to give or delay in giving such notice
                shall not
                relieve the Account Party of their obligation to reimburse the Lenders
                with respect to any such LC
                Disbursement.

            

    

     

    Right
      to make Payments under Letters of Credit

     

    5.2           Each
      Lender shall be entitled to make any payment in accordance with the terms of
      the
      relevant Letter of Credit without any reference to or further authority from
      the
      Account Party or any other investigation or enquiry.

     

    Liability
      of Lenders

     

    5.3           Neither
      the Agent, nor any Lender nor any of their Related Parties shall have any
      liability or responsibility by reason of or in connection with the issuance
      or
      transfer of any Letter of Credit or any payment or failure to make any payment
      thereunder (irrespective of any of the circumstances referred to in the
      preceding sentence), or any error, omission, interruption, loss or delay in
      transmission or delivery of any draft, notice or other communication under
      or
      relating to any Letter of Credit (including any document required to make a
      drawing thereunder), any error in interpretation of technical terms or any
      consequence arising from causes beyond their control; provided that the
      foregoing shall not be construed to excuse the Agent or a Lender from liability
      to any Obligor to the extent of any direct damages (as opposed to consequential
      damages, claims in respect of which are hereby waived by the Obligors to the
      extent permitted by applicable Law) suffered by any Obligor that are caused
      by
      the gross negligence or wilful misconduct of the Agent or a Lender. The parties
      hereto expressly agree that:

     

    
      	
              (a)

            	
              the
                Agent may accept documents that appear on their face to be in substantial
                compliance with the terms of a Letter of Credit without responsibility
                for
                further investigation, regardless of any notice or information to
                the
                contrary, and may make payment upon presentation of documents that
                appear
                on their face to be in substantial compliance with the terms of such
                Letter of Credit;

            

    

     

    
      	
              (b)

            	
              the
                Agent shall have the right, in its sole discretion, to decline to
                accept
                such documents and to make such payment if such documents are not
                in
                strict compliance with the terms of such Letter of Credit;
                and

            

    

     

    
      	
              (c)

            	
              this
                Clause shall establish the standard of care to be exercised by the
                Agent
                when determining whether drafts and other documents presented under
                a
                Letter of Credit comply with the terms thereof (and the parties hereto
                hereby waive, to the extent permitted by applicable Law, any standard
                of
                care inconsistent with the
                foregoing).

            

    

     

    6.           THE
      ACCOUNT PARTY’S LIABILITIES IN RELATION TO LETTERS OF
      CREDIT

     

    The
      Account Party’s Indemnity to Lenders

     

    6.1           The
      Account Party shall irrevocably and unconditionally as a primary obligation
      indemnify (on demand by the Agent (and any Lender may require the Agent to
      make
      such demand)) each Lender against:

     

    
      
        
        

      

      
        -19-

        
          

        

      

      
        
        

      

    

    (a)           any
      LC Disbursement paid or payable by such Lender in accordance with the terms
      of
      any Letter of Credit requested by the Account Party; and

     

    
      	
              (b)

            	
              all
                liabilities, reasonable costs (including, without limitation, any
                costs
                incurred in funding any amount which falls due from such Lender in
                connection with such Letter of Credit), claims, losses and reasonable
                expenses which such Lender may at any time properly incur or sustain
                in
                connection with any Letter of
                Credit.

            

    

     

    Preservation
      of Rights

     

    6.2           Neither
      the obligations of the Account Party set out in this Clause 6 nor the
      rights, powers and remedies conferred on any Lender by this Agreement or by
      Law
      shall be discharged, impaired or otherwise affected by:

     

    
      	
              (a)

            	
              the
                winding-up, dissolution, administration or re-organisation of any
                Lender
                or any other person or any change in its status, function, control
                or
                ownership;

            

    

     

    
      	
              (b)

            	
              any
                of the obligations of any Lender or any other person hereunder or
                under
                any Letter of Credit or under any other security taken in respect
                of the
                Account Party’s obligations hereunder or otherwise in connection with any
                Letter of Credit being or becoming illegal, invalid, unenforceable
                or
                ineffective in any respect;

            

    

     

    
      	
              (c)

            	
              time
                or other indulgence being granted or agreed to be granted to any
                Lender or
                any other person in respect of its obligations hereunder or under
                or in
                connection with any Letter of Credit or under any such other
                security;

            

    

     

    
      	
              (d)

            	
              any
                amendment to, or any variation, waiver or release of, any obligation
                of
                any Lender or any other person under any Letter of Credit or this
                Agreement;

            

    

     

    
      	
              (e)

            	
              any
                other act, event or omission which, but for this Clause 6 might
                operate to discharge, impair or otherwise affect any of the obligations
                of
                the Account Party set out in this Clause 6 or any of the rights,
                powers or remedies conferred upon any Lender by this Agreement or
                by
                Law.

            

    

     

    The
      obligations of the Account Party set out in this Clause 6 shall be in
      addition to and independent of every other security which any Lender may at
      any
      time hold in respect of the Account Party’s obligations hereunder.

     

    Settlement
      Conditional

     

    6.3           Any
      settlement or discharge between the Account Party and a Lender shall be
      conditional upon no security or payment to such Lender by the Account Party
      or
      any other person on behalf of the Account Party, being avoided or reduced by
      virtue of any Laws relating to bankruptcy, insolvency, liquidation or similar
      Laws of general application and, if any such security or payment is so avoided
      or reduced, such Lender shall be entitled to recover the value or amount of
      such
      security or payment from the Account Party subsequently as if such settlement
      or
      discharge had not occurred.

     

    7.           DEFAULT
      INTEREST

     

    A
      Demand
      Amount shall bear interest during each Default Period in respect thereof, and
      any other amount unpaid when due hereunder shall bear interest for so long
      as it
      remains outstanding at rate of the sum of (i) two per cent. per annum
      (ii) the Mandatory Costs in respect thereof at such time, and
      (iii) LIBOR on each day whilst such amount remains
      outstanding.  Such interest shall be payable by the Account Party on
      the date on which it reimburses the Lenders under Clause 6.1(a) and (b) (The
      Account Party’s Indemnity to Lenders).

     

    8.           TERMINATION
      AND REDUCTION OF THE COMMITMENTS

     

    Scheduled
      Termination

     

    
      
        
        

      

      
        -20-

        
          

        

      

      
        
        

      

    

    8.1           Unless
      previously terminated, the unutilised Commitments shall terminate at the close
      of business on the Commitment Termination Date.

     

    Voluntary
      Cancellation or Reduction

     

    8.2           The
      Account Party may at any time cancel, or from time to time reduce, the Total
      Commitments; provided that (a) each reduction of the Total Commitments shall
      be
      in an amount of £5,000,000 or a larger multiple of £1,000,000 and (b) the
      Account Party shall not cancel or reduce the Commitments if the Total LC
      Exposures would exceed the Total Commitments.

     

    Notice
      of Voluntary Cancellation or Reduction

     

    8.3           The
      Account Party shall notify the Agent of any election to cancel or reduce the
      Total Commitments under Clause 8.2 at least three Business Days prior to
      the effective date of such cancellation or reduction, specifying such election
      and the effective date thereof. Promptly following receipt of any notice, the
      Agent shall advise the Lenders of the contents thereof. Each notice delivered
      by
      the Account Party pursuant to this Clause shall be irrevocable; provided that
      a
      notice of cancellation of the Commitments delivered by the Account Party may
      state that such notice is conditioned upon the effectiveness of other credit
      facilities, in which case such notice may be revoked by the Account Party (by
      notice to the Agent on or prior to the specified effective date) if such
      condition is not satisfied.

     

    No
      Other Repayments or Cancellation

     

    8.4           The
      Account Party shall not repay or cancel all or any part of the LC Exposures
      except at the times and in the manner expressly provided for in this
      Agreement.

     

    Effect
      of Cancellation or Reduction

     

    8.5           Any
      cancellation or reduction of the Commitments shall be permanent. Each reduction
      of the Commitments shall be made rateably among the Lenders in accordance with
      their respective Commitments.

     

    9.           FEES

     

    Participation
      Fee

     

    9.1           The
      Account Party shall pay to the Agent for the account of the Lenders the
      participation fees specified in the Fee Letter.

     

    Letter
      of Credit Fee

     

    
      	
              9.2
                (a)

            	
              The
                Account Party shall pay to the Agent for the account of each Lender
                pro
                rata according to their respective LC Exposures hereunder a letter
                of
                credit fee computed at the rate of 0.50 per cent. per annum (as such
                rate
                may be adjusted from time to time in accordance with the provisions
                of
                Clause 9.3) on the principal amount of each issued Letter of Credit
                payable from the Utilisation Date until the Final Expiration Date
                (as
                extended) of that Letter of Credit or any earlier cancellation, repayment
                or prepayment of the Letter of Credit in accordance with Clause 8
                (Termination and Reduction of the Commitments) of this
                Agreement;

            

    

     

    
      	
              (b)

            	
              the
                Letter of Credit Fees shall be payable quarterly in arrears on each
                Quarterly Date and on the date on which the Lenders cease to have
                any LC
                Exposure.  Letter of Credit Fees accrued through and including
                each Quarterly Date shall be payable on the fifth Business Day following
                such Quarterly Date, commencing on the first such date to occur after
                the
                Commencement Date; and

            

    

     

    
      	
              (c)

            	
              the
                Agent shall notify the Account Party in writing at least ten Business
                Days
                prior to each Quarterly Date of (i) the letter of credit fee payable
                in respect of each Letter of Credit issued and (ii) the aggregate
                letter of credit fee payable in respect of all Letters of Credit
                issued.

            

    

     

    
      
        
        

      

      
        -21-

        
          

        

      

      
        
        

      

    

     

      Adjustment
        of Letter of Credit Fee

    

     

    
      	
              9.3(a)

            	
              Notwithstanding
                Clause 9.2(a) above, when the Financial Strength Rating (as defined
                below)
                corresponds to a rating set out in Column 1 or Column 2 below of
                the fee
                chart (the Fee Chart), the Letter of Credit Fee
                payable in accordance with Clause 9.2 shall be the amount set out
                in the
                corresponding row in Column 3 of the Fee Chart; provided however,
                that
                whilst AMB Cash Collateral is posted in compliance with the provisions
                of
                Clause 19.8 (Ratings Downgrade) the Letter of Credit Fee shall be
                0.30 per cent. per annum. Upon any AMB Cash Collateral which has
                been
                posted being fully released, in each case in compliance with Clause
                19.8
                (Ratings Downgrade), then the Letter of Credit Fee shall once
                again be payable in accordance with the Fee
                Chart.

            

    

     

    
      	
              (b)

            	
              Any
                change to the Letter of Credit Fee described above shall take effect
                on
                the day on which the Financial Strength Rating change is publicly
                announced by the applicable rating agency; or, in the event either
                of the
                conditions set forth in Clause 19.8(a) or (b) are not satisfied,
                the day
                on which the provisions of Clause 19.8 (Ratings Downgrade) have
                been complied with.

            

    

     

    Fee
      Chart

     

    
      	
              A.M.
                Best & Co.

              Financial-Strength
                Rating

              Column
                1

               

            	
              Standard
                & Poor’s

              Rating
                Services

              Financial-Strength
                Rating

              Column
                2

               

            	
              Letter
                of Credit Fee

              Column
                3

               

            
	
              A++

               

            	
              Greater
                than or equal to AA+

               

            	
              0.30
                per cent. per annum

               

            
	
              A+

               

            	
              AA

               

            	
              0.40
                per cent. per annum

               

            
	
              A

               

            	
              AA-

               

            	
              0.45
                per cent. per annum

               

            
	
              A-

               

            	
              A+

               

            	
              0.50
                per cent. per annum

               

            
	
              B++
                and below

               

            	
              A
                and below

               

            	
              0.65
                per cent. per annum

               

            

    

    

    
      	
              (c)

            	
              In
                this Clause 9.3and in Clause19.8, Financial Strength
                Rating means the lower
                of:

            

    

     

    
      	
               

            	
              (i)

            	
              the
                financial-strength rating of the XL Capital Group from A.M. Best
& Co.
                (or its successor); and

            

    

     

    
      	
               

            	
              (ii)

            	
              the
                lower of the financial-strength rating from Standard & Poor’s Rating
                Services (or its successor) of XL Insurance and XL
                Re.

            

    

     

    In
      the
      event that either A.M. Best & Co. or Standard & Poor’s Ratings Services
      changes the designation of its ratings (including without limitation by
      increasing the number of ratings available or notches within ratings), then
      the
      Agent and all the Lenders shall negotiate in good faith such amendments
      to this Clause 9.3 as are necessary to ensure that (in the
      opinion of the Lenders, acting reasonably) the Letter of Credit Fees payable
      relative to the strength of the relevant rating are the same as they are on
      the
      date hereof.

     

    Commitment
      fee

     

    
      	
              9.4
                (a)

            	
              The
                Account Party shall pay to the Agent for the account of each Lender
                a fee
                computed at the rate of 33 per cent. per annum of the applicable
                Letter of
                Credit Fee from time to time on that Lender’s Available Commitment for the
                Availability Period.

            

    

     

    
      
        
        

      

      
        -22-

        
          

        

      

      
        
        

      

    

    
      	
              (b)

            	
              The
                accrued commitment fee is payable quarterly in arrears on each Quarterly
                Date during the Availability Period, on the last day of the Availability
                Period and, if cancelled in full, on the cancelled amount of the
                relevant
                Lender’s Commitment at the time the cancellation is
                effective.

            

    

     

    Agent
      Fees

     

    9.5           The
      Account Party agrees to pay to the Agent, for its own account, the agency fees
      payable in the amounts and at the times specified in the Fee
      Letter.

     

    Payment
      of Fees

     

    9.6           All
      fees payable hereunder shall be paid on the dates due, in immediately available
      funds, to the Agent for distribution, in the case of the Letter of Credit Fees
      referred to in Clause 9.2 and the commitment fee referred in Clause9.4, to
      the Lenders entitled thereto. Fees paid shall not be refundable under any
      circumstances absent manifest error in the calculation or payment of fees due
      and payable.

     

    Basis
      of Calculation

     

    The
      fees
      payable pursuant to Clauses 9.1, 9.2 and 9.4shall be calculated on the
      basis of actual days elapsed and a 365 day year.

     

    10.           TAXES

     

    Tax
      Gross-up

     

    10.1           All
      payments to be made by an Obligor to any Finance Party hereunder, whether in
      respect of principal, interest, fees or any other item, shall be made free
      and
      clear of and without deduction for or on account of tax unless such Obligor
      is
      required to make such a payment subject to the deduction or withholding of
      tax,
      in which case the sum payable by such Obligor (in respect of which such
      deduction or withholding is required to be made) shall be increased to the
      extent necessary to ensure that such Finance Party receives a sum net of any
      deduction or withholding equal to the sum which it would have received had
      no
      such deduction or withholding been made or required to be made.

     

    Tax
      Indemnity

     

    10.2           Without
      prejudice to Clause 10.1 (Tax Gross-up), if any Finance Party is
      required to make any payment of or on account of tax on or in relation to any
      sum received or receivable hereunder (including any sum deemed for purposes
      of
      tax to be received or receivable by such Finance Party whether or not actually
      received or receivable) or if any liability in respect of any such payment
      is
      asserted, imposed, levied or assessed against any Finance Party, the Account
      Party shall, upon demand of the Agent, promptly indemnify the Finance Party
      which suffers a loss or liability as a result against such payment or liability,
      together with any interest, penalties, costs and expenses payable or incurred
      in
      connection therewith, PROVIDED THAT this Clause 10.2 shall not
      apply to:

     

    
      	
              (a)

            	
              any
                tax imposed on and calculated by reference to the net income actually
                received or receivable by such Finance Party by the jurisdiction
                in which
                such Finance Party is incorporated;
                or

            

    

     

    
      	
              (b)

            	
              any
                tax imposed on and calculated by reference to the net income of the
                Facility Office of such Finance Party actually received or receivable
                by
                such Finance Party by the jurisdiction in which its Facility Office
                is
                located; or

            

    

     

    
      	
              (c)

            	
              the
                extent a loss, liability or cost is compensated for by an increased
                payment under Clause 10.1 (Tax
                Gross-up).

            

    

     

    Claims
      by Lenders

     

    
      
        
        

      

      
        -23-

        
          

        

      

      
        
        

      

    

    10.3           A
      Lender intending to make a claim pursuant to Clause 10.2 (Tax
      Indemnity) shall promptly notify the Agent of the event giving rise to the
      claim, whereupon the Agent shall promptly notify the Account Party
      thereof.

     

    11.           TAX
      RECEIPTS

     

    Notification
      of Requirement to Deduct Tax

     

    11.1           If,
      at any time, an Obligor is required by Law to make any deduction or withholding
      from any sum payable by it hereunder (or if thereafter there is any change
      in
      the rates at which or the manner in which such deductions or withholdings are
      calculated), such Obligor shall promptly, upon becoming aware of the same,
      notify the Agent.

     

    Evidence
      of Payment of Tax

     

    11.2           If
      an Obligor makes any payment hereunder in respect of which it is required to
      make any deduction or withholding, it shall pay the full amount required to
      be
      deducted or withheld to the relevant taxation or other authority within the
      time
      allowed for such payment under applicable Law and shall deliver to the Agent
      for
      each Lender, within thirty days after it has made such payment to the applicable
      authority, an original receipt (or a certified copy thereof) issued by such
      authority evidencing the payment to such authority of all amounts so required
      to
      be deducted or withheld in respect of that Lender’s share of such
      payment.

     

    Tax
      Credit Payment

     

    11.3           If
      an additional payment is made under Clause 10 (Taxes) by an
      Obligor for the benefit of any Finance Party and such Finance Party, in its
      sole
      discretion, determines that it has obtained (and has derived full use and
      benefit from) a credit against, a relief or remission for, or repayment of,
      any
      tax, then, if and to the extent that such Finance Party, in its sole opinion,
      determines that:

     

    
      	
              (a)

            	
              such
                credit, relief, remission or repayment is in respect of or calculated
                with
                reference to the additional payment made pursuant to Clause 10
                (Taxes); and

            

    

     

    
      	
              (b)

            	
              its
                tax affairs for its tax year in respect of which such credit, relief,
                remission or repayment was obtained have been finally
                settled,

            

    

     

    such
      Finance Party shall, to the extent that it can do so without prejudice to the
      retention of the amount of such credit, relief, remission or repayment, pay
      to
      such Obligor such amount as such Finance Party shall, in its sole opinion,
      determine to be the amount which will leave such Finance Party (after such
      payment) in no worse after-tax position than it would have been in had the
      additional payment in question not been required to be made by such
      Obligor.

     

    Tax
      Credit Clawback

     

    11.4           If
      any Finance Party makes any payment to an Obligor pursuant to Clause 11.3
      (Tax Credit Payment) and such Finance Party subsequently determines, in
      its sole opinion, that the credit, relief, remission or repayment in respect
      of
      which such payment was made was not available or has been withdrawn or that
      it
      was unable to use such credit, relief, remission or repayment in full, the
      Obligor shall reimburse such Finance Party such amount as such Finance Party
      determines, in its sole opinion, is necessary to place it in the same after-tax
      position as it would have been in if such credit, relief, remission or repayment
      had been obtained and fully used and retained by such Finance
      Party.

     

    Tax
      and Other Affairs

     

    11.5           No
      provision of this Agreement shall interfere with the right of any Finance Party
      to arrange its tax or any other affairs in whatever manner it thinks fit, oblige
      any Finance Party to claim any credit, relief, remission or repayment in respect
      of any payment under Clause 10.1 (Tax Gross-up) in priority to any
      other credit, relief, remission

     

    
      
        
        

      

      
        -24-

        
          

        

      

      
        
        

      

    

    or
      repayment available to it nor oblige any Finance Party to disclose any
      information relating to its tax or other affairs or any computations in respect
      thereof.

     

    12.           INCREASED
      COSTS

     

    Increased
      Costs

     

    12.1           Subject
      to Clause 12.2 (Exceptions), if after the date of this Agreement,
      the result of:

     

    
      	
              (a)

            	
              the
                introduction of or any change in the official or judicial interpretation
                or application of any Law (having the force of law or if not having
                the
                force of law, generally complied with by a Lender in relation to
                any
                relevant jurisdiction); and/or

            

    

     

    
      	
              (b)

            	
              compliance
                (without adopting materially less prudent policies or standards than
                those
                previously adopted by it) by any Lender or by the holding company
                of any
                Lender with any of the matters mentioned in paragraph (a)
                above,

            

    

     

    including
      in each case, without limitation, those Laws relating to Taxation, any change
      in
      currency, any reserve, special deposit, cash ratio, liquidity or capital
      adequacy requirement or any other form of banking or monetary controls, is
      that:

     

    
      	
               

            	
              (i)

            	
              a
                Lender or its holding company incurs an additional cost as a result
                of
                that Finance Party having entered into, or performing, maintaining
                or
                funding its obligations under this Agreement;
                or

            

    

     

    
      	
               

            	
              (ii)

            	
              a
                Lender or its holding company incurs an additional cost in making,
                funding
                or maintaining any Letters of Credit made or to be made by it under
                this
                Agreement; or

            

    

     

    
      	
               

            	
              (iii)

            	
              any
                amount payable to a Lender or the effective return to a Lender under
                this
                Agreement or the effective return to a Lender or its holding company
                on
                its capital is reduced as a result of any change in the amount or
                nature
                of the capital resources required to be allocated in respect of a
                Lender’s
                participation under this Agreement;
                or

            

    

     

    
      	
               

            	
              (iv)

            	
              a
                Lender makes any payment or foregoes any interest or other return
                on or
                calculated by reference to any amount received or receivable by it
                from
                the Account Party or the Agent under this
                Agreement;

            

    

     

    then
      and
      in each such case:

     

    
      	
               

            	
              (A)

            	
              the
                Lender shall notify the Account Party through the Agent of the relevant
                event promptly upon becoming aware of the event giving details of
                any
                costs or amount likely to be demanded under paragraph
                (B);

            

    

     

    
      	
               

            	
              (B)

            	
              promptly
                following any demand from time to time by that Lender through the
                Agent,
                the Account Party shall pay to the Agent for the account of that
                Finance
                Party (or, as the case may be, its holding company) such amount as
                shall
                compensate such Finance Party or its holding company for the additional
                cost, reduction, payment or foregone interest or other
                return.

            

    

     

    Exceptions

     

    12.2           Clause 12.1
      shall not apply to or in respect of:

     

    
      	
              (a)

            	
              any
                circumstances referred to in Clause 10.2 (Tax
                Indemnity);

            

    

     

    
      
        
        

      

      
        -25-

        
          

        

      

      
        
        

      

    

    
      	
              (b)

            	
              any
                circumstances for which a relevant Lender has been compensated for
                under
                Clause 0 (Tax Credit
                Payment).

            

    

     

    13.           ILLEGALITY

     

    If,
      after
      the date of this Agreement, any Change in Law or in the official or judicial
      interpretation or application thereof shall make it unlawful or contrary to
      an
      official directive in any jurisdiction for any Lender to make available or
      fund
      or maintain or to give effect to its obligations as contemplated by this
      Agreement or the Letters of Credit (or, by reason only of a Change of Law,
      the
      Lender ceases to be an Approved Credit Institution), the Lender shall promptly
      on becoming aware of the same give notice thereof to the Account Party through
      the Agent, whereupon:

     

    
      	
              (a)

            	
              where
                such change makes it unlawful or contrary to an official directive
                to
                maintain or give effect to its obligations under this Agreement,
                if the
                Agent on behalf of such Lender so requires, the Account Party shall
                by no
                later than the last day of any applicable grace period specified
                by the
                applicable Law ensure that the liabilities of such Lender under or
                in
                respect of each Letter of Credit are cancelled within the meaning
                of
                Clause 1.2(m)(i)(A) (or use its best efforts to ensure that such
                liabilities are cancelled within the meaning of Clause 1.2(m)(i)(C)),
                the Commitment of that Lender shall forthwith be cancelled and the
                Account
                Party shall prepay forthwith fees, costs and expenses due to that
                Lender
                hereunder;

            

    

     

    
      	
              (b)

            	
              where
                such change only makes it unlawful or contrary to an official directive
                to
                participate in further Letters of Credit under this Agreement, then
                upon
                receipt by the Agent of that notice, the Available Commitment of
                that
                Lender shall be reduced to zero, and upon the expiry of each Letter
                of
                Credit in which it is participating at such time, its resulting Available
                Commitment shall also be cancelled, provided that if the Lender
                subsequently transfers or assigns its rights and obligations under
                this
                Agreement to a new lender pursuant to Clause 26.5 (Rights to
                substitute a single Bank), the Account Party may by notice to the
                Agent increase the Commitment of such new lender by the amount of
                the
                Available Commitment that was previously
                cancelled.

            

    

     

    14.           MITIGATION
      OBLIGATIONS; REPLACEMENT OF LENDERS.

     

    Designation
      of a Different Lending Office

     

    14.1           If
      any Lender requests compensation under Clause 12 (Increased
      Costs), or if the Account Party is required to pay any additional amount to
      any Lender or any Governmental Authority for account of any Lender pursuant
      to
      Clause 10 (Taxes), then such Lender shall use reasonable efforts
      to designate a different lending office for funding or booking its Letters
      of
      Credit hereunder or to transfer its rights and obligations hereunder to another
      of its offices, branches or Affiliates, if, in the reasonable judgment of such
      Lender, such designation or assignment (a) would eliminate or reduce amounts
      payable pursuant to Clause 12 (Increased Costs) or 10 (Taxes),
      as the case may be, in the future and (b) would not subject such Lender to
      any
      unreimbursed cost or expense and would not otherwise be disadvantageous to
      such
      Lender. The Account Party hereby agrees to pay all reasonable costs and expenses
      incurred by any Lender in connection with any such designation or
      assignment.

     

    Replacement
      of Lenders

     

    14.2           If
      any Lender requests compensation under Clause 12 (Increased
      Costs), or if any Account Party is required to pay any additional amount to
      any Lender or any Governmental Authority for account of any Lender pursuant
      to
      Clause 10 (Taxes), or if any Lender defaults in its
      obligation to make LC Disbursements hereunder, or if any Lender ceases to be
      an
      Approved Credit Institution, then the Account Party may, at its sole expense
      and
      effort, upon notice to such Lender and the Agent, require such Lender to assign
      and delegate, without recourse (in accordance with and subject to the
      restrictions contained in Clause 26.5 (Right to substitute single
      Lender)), all its interests, rights and obligations under this Agreement to
      an Approved Credit Institution that shall assume such obligations (which
      assignee may be another Lender, if a Lender accepts such assignment); provided
      that:

     

    
      	
              (a)

            	
              the
                Account Party shall have received the prior written consent of the
                Agent,
                which consent shall not unreasonably be
                withheld;

            

    

     

    
      
        
        

      

      
        -26-

        
          

        

      

      
        
        

      

    

    
      	
              (b)

            	
              such
                Lender shall have received payment of an amount equal to the outstanding
                amount of its LC Disbursements, accrued interest thereon, accrued
                fees and
                all other amounts payable to it hereunder, from the assignee (to
                the
                extent of such outstanding principal and accrued interest and fees)
                or the
                relevant Account Party (in the case of all other amounts);
                and

            

    

     

    
      	
              (c)

            	
              in
                the case of any such assignment resulting from a claim for compensation
                under Clause 12 (Increased Costs) or payments required to be
                made pursuant to Clause 10 (Taxes), such assignment will
                result in a reduction in such compensation or
                payments.

            

    

     

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

     

    15.           PAYMENTS
      GENERALLY; PRO RATA TREATMENT; SHARING OF SET-OFFS.

     

    Payments
      by the Account Party

     

    
      	
              15.1
                (a)

            	
              The
                Account Party shall make each payment required to be made by them
                hereunder or under any other Finance Document (except to the extent
                otherwise provided therein) in Sterling on the date when due, in
                immediately available cleared funds, without set-off or counterclaim
                (and
                in the case of payments required pursuant to Clause 6, by 11.00 a.m.
                on the due date).  Any amounts received after such time on any
                date may, in the discretion of the Agent, be deemed to have been
                received
                on the next succeeding Business Day for the purposes of calculating
                interest thereon.  All such payments shall be made to the Agent
                at the account most recently notified by it, except payments pursuant
                to
                Clauses 12 (Increased Costs), 10 (Taxes),
                24 (Costs and Expenses) and 25 (Indemnities), which
                shall be made directly to the Persons entitled thereto. The Agent
                shall
                distribute any such payments received by it for account of any other
                Person to the appropriate recipient promptly following receipt
                thereof.

            

    

     

    
      	
              (b)

            	
              If
                any payment hereunder shall be due on a day that is not a Business
                Day,
                the date for payment shall be extended to the next succeeding Business
                Day
                and, in the case of any payment accruing interest, interest thereon
                shall
                be payable for the period of such
                extension.

            

    

     

    Currency

     

    15.2           All
      amounts payable under this Agreement in respect of any Letter of Credit shall
      be
      payable in Sterling.

     

    Application
      of Insufficient Payments

     

    15.3           If
      at any time insufficient funds are received by and available to the Agent to
      pay
      fully all Demand Amounts, interest, fees and expenses then due hereunder, such
      funds shall be applied:

     

    
      	
              (a)

            	
              first,
                in or towards payment pro rata of any unpaid fees, costs, expenses,
                indemnity payments and other amounts due to the Agent and the Security
                Trustee under the Finance
                Documents;

            

    

     

    
      	
              (b)

            	
              secondly,
                in or towards payment pro rata of any unpaid costs and expenses of
                the
                Lenders under the Finance
                Documents;

            

    

     

    
      	
              (c)

            	
              thirdly,
                in or towards payment pro rata of any outstanding fees (other than
                Letter
                of Credit Fees) payable to the Lenders under the Finance
                Documents;

            

    

     

    
      	
              (d)

            	
              fourthly,
                in or towards payment pro rata of all accrued Letter of Credit Fees
                due to
                Issuing Lenders but unsatisfied under this
                Agreement;

            

    

     

    
      	
              (e)

            	
              fifthly,
                in or towards payment pro rata of any interest on Demand
                Amounts;

            

    

     

    
      
        
        

      

      
        -27-

        
          

        

      

      
        
        

      

    

    
      	
              (f)

            	
              sixthly,
                in or towards payment pro rata of Demand
                Amounts;

            

    

     

    
      	
              (g)

            	
              seventhly,
                in or towards payment pro rata of any principal (other than a Demand
                Amount) due but unsatisfied under this Agreement (including, for
                the
                avoidance of doubt, any cash cover to be provided under a Letter
                of
                Credit); and

            

    

     

    
      	
              (h)

            	
              eighthly,
                in or towards payment pro rata of any other sum due but unsatisfied
                under
                this Agreement.

            

    

     

    Pro
      Rata Treatment

     

    15.4           Except
      to the extent otherwise provided herein:

     

    
      	
              (a)

            	
              each
                reimbursement of LC Disbursements shall be made to the Lenders, each
                payment of fees under Clause 9 (Fees) shall be made for
                account of the Lenders, and each termination or reduction of the
                Commitments under Clause 8 (Termination and Reduction of the
                Commitments) shall be applied to the respective Commitments of the
                Lenders, pro rata according to their respective Commitments;
                and

            

    

     

    
      	
              (b)

            	
              each
                payment of interest shall be made for account of the Lenders pro
                rata in
                accordance with the amounts of interest then due and payable to the
                respective Lenders.

            

    

     

    Sharing
      of Payments by Lenders

     

    15.5           If
      any Lender shall, by exercising any right of set-off or counterclaim or
      otherwise, obtain payment in respect of any LC Exposures resulting in such
      Lender receiving payment of a greater proportion of the aggregate amount of
      its
      LC Exposures and accrued interest thereon then due than the proportion received
      by any other Lender, then the Lender receiving such greater proportion shall
      purchase (for cash at face value) participations in the LC Exposures of other
      Lenders to the extent necessary so that the benefit of all such payments shall
      be shared by the Lenders rateably in accordance with the aggregate amount of
      LC
      Exposures; provided that:

     

    
      	
              (a)

            	
              if
                any such participations are purchased and all or any portion of the
                payment giving rise thereto is recovered, such participations shall
                be
                rescinded and the purchase price restored to the extent of such recovery,
                without interest; and

            

    

     

    
      	
              (b)

            	
              the
                provisions of this Clause shall not be construed to apply to any
                payment
                made by any Obligor pursuant to and in accordance with the express
                terms
                of this Agreement or any payment obtained by a Lender as consideration
                for
                the assignment of or sale of a participation in LC Disbursements
                to any
                assignee or participant, other than to the Account Party or any Subsidiary
                or Affiliate thereof (as to which the provisions of this paragraph
                shall
                apply).

            

    

     

    Each
      Obligor consents to the foregoing and agrees, to the extent it may effectively
      do so under applicable Law, that any Lender acquiring a participation pursuant
      to the foregoing arrangements may exercise against the Account Party rights
      of
      set-off and counterclaim with respect to such participation as fully as if
      such
      Lender were a direct creditor of the Account Party in the amount of such
      participation and the Obligors authorise the Lenders to exchange Transfer
      Certificates and any other documentation to give effect to those purchases
      of
      participations.

     

    Presumptions
      of Payment

     

    15.6           Unless
      the Agent shall have received notice from any party prior to the date on which
      any payment is due to the Agent hereunder that the payor will not make such
      payment, the Agent may assume that the payor has made such payment on such
      date
      in accordance herewith and may, in reliance upon such assumption, distribute
      to
      the relevant payee the amount due. In such event, if the payor has not in fact
      made such payment, then each of the payees severally agrees to repay to the
      Agent forthwith on demand the amount so distributed to that payee with interest
      thereon, for each day from and including the date such amount is distributed
      to
      it to but excluding the date of payment to the Agent, at the Agent’s cost of
      funds from such sources as the Agent may reasonably select.

     

    
      
        
        

      

      
        -28-

        
          

        

      

      
        
        

      

    

    Certain
      Deductions by the Agent

     

    15.7           If
      any Lender shall fail to make any payment required to be made by it pursuant
      to
      Clause 15.5 (Sharing of Payments by Lenders), then the Agent may,
      in its discretion (notwithstanding any contrary provision hereof), apply any
      amounts thereafter received by the Agent for account of such Lender to satisfy
      such Lender’s obligations under such Clauses until all such unsatisfied
      obligations are fully paid.

     

    16.           GUARANTEE
      AND INDEMNITY

     

    Guarantee
      and Indemnity

     

    16.1           The
      Guarantors, jointly and severally, irrevocably and unconditionally:

     

    
      	
              (a)

            	
              guarantee
                to each Finance Party the due and punctual payment from time to time
                on
                demand any and every sum or sums of money which the Account Party
                is at
                any time liable to pay to any Finance Party under or pursuant to
                the
                Finance Documents and which has become due and payable but has not
                been
                paid at the time such demand is made (the Guaranteed
                Obligations); and

            

    

     

    
      	
              (b)

            	
              agree
                as a primary obligation to indemnify each Finance Party from time
                to time
                on demand from and against any loss incurred by any Finance Party
                as a
                result of any of the obligations of the Account Party under or pursuant
                to
                the Finance Documents being or becoming void, voidable, unenforceable
                or
                ineffective as against the Account Party for any reason whatsoever,
                whether or not known to any Finance Party or any other person, the
                amount
                of such loss being the amount which the person or persons suffering
                it
                would otherwise have been entitled to recover from the Account
                Party.

            

    

     

    Additional
      Security

     

    16.2           The
      obligations of each Guarantor herein contained shall be in addition to and
      independent of every other security which any Finance Party may at any time
      hold
      in respect of any of the Account Party’s obligations under the Finance
      Documents.

     

    Continuing
      Obligations

     

    16.3           The
      obligations of each Guarantor herein contained shall constitute and be
      continuing obligations notwithstanding any settlement of account or other matter
      or thing whatsoever and shall not be considered satisfied by any intermediate
      payment or satisfaction of all or any of the obligations of the Account Party
      under the Finance Documents and shall continue in full force and effect until
      final payment in full of all amounts owing by the Account Party under this
      Agreement and total satisfaction of all the Account Party’s actual and
      contingent obligations under the Finance Documents.

     

    Obligations
      not Discharged

     

    16.4           Neither
      the obligations of the Guarantors herein contained nor the rights, powers and
      remedies conferred in respect of the Guarantors upon any Finance Party by the
      Finance Documents or by Law shall be discharged, impaired or otherwise affected
      by:

     

    
      	
              (a)

            	
              the
                winding-up, dissolution, administration or re-organisation of the
                Account
                Party or any other person or any change in its status, function,
                control
                or ownership;

            

    

     

    
      	
              (b)

            	
              any
                of the obligations of the Account Party or any other person under
                the
                Finance Documents or under any other security taken in respect of
                any of
                its obligations under the Finance Documents being or becoming illegal,
                invalid, unenforceable or ineffective in any
                respect;

            

    

     

    
      	
              (c)

            	
              time
                or other indulgence being granted or agreed to be granted to any
                Obligor
                in respect of its obligations under the Finance Documents or under
                any
                such other security;

            

    

     

    
      
        
        

      

      
        -29-

        
          

        

      

      
        
        

      

    

    
      	
              (d)

            	
              any
                amendment to, or any variation, waiver or release of, any obligation
                of
                any Obligor under the Finance Documents or under any such other
                security;

            

    

     

    
      	
              (e)

            	
              any
                failure to take, or fully to take, any security contemplated hereby
                or
                otherwise agreed to be taken in respect of the Obligors’ obligations under
                the Finance Documents;

            

    

     

    
      	
              (f)

            	
              any
                failure to realise or fully to realise the value of, or any release,
                discharge, exchange or substitution of, any security taken in respect
                of
                the Obligors’ obligations under the Finance Documents;
                or

            

    

     

    
      	
              (g)

            	
              any
                other act, event or omission which, but for this Clause 16.4, might
                operate to discharge, impair or otherwise affect any of the obligations
                of
                any Guarantor herein contained or any of the rights, powers or remedies
                conferred upon any of the Finance Parties by the Finance
                Documents or by
                Law.

            

    

     

    Settlement
      Conditional

     

    16.5           Any
      settlement or discharge between any Obligor and any of the Finance Parties
      shall
      be conditional upon no security or payment to any Finance Party by the Account
      Party or any other person on behalf of the Account Party being avoided or
      reduced by virtue of any Laws relating to bankruptcy, insolvency, liquidation
      or
      similar Laws of general application and, if any such security or payment is
      so
      avoided or reduced, each Finance Party shall be entitled to recover the value
      or
      amount of such security or payment from the Account Party subsequently as if
      such settlement or discharge had not occurred.

     

    Exercise
      of Rights

     

    16.6           No
      Finance Party shall be obliged before exercising any of the rights, powers
      or
      remedies conferred upon them in respect of any Guarantor by the Finance
      Documents or by Law to:

     

    
      	
              (a)

            	
              make
                any demand of the Account Party or any other
                Obligor;

            

    

     

    
      	
              (b)

            	
              take
                any action or obtain judgment in any court against the Account Party
                or
                any other Obligor;

            

    

     

    
      	
              (c)

            	
              make
                or file any claim or proof in a winding-up or dissolution of the
                Account
                Party or any other Obligor; or

            

    

     

    
      	
              (d)

            	
              enforce
                or seek to enforce any other security taken in respect of any of
                the
                obligations of the Account Party or any other Obligor under the Finance
                Documents.

            

    

     

    Deferral
      of Guarantor’s Rights

     

    16.7           Each
      Guarantor agrees that, so long as any amounts are or may be owed by the Account
      Party under the Finance Documents or the Account Party is under any actual
      or
      contingent obligations under the Finance Documents, it shall not exercise any
      rights which it may at any time have by reason of performance by it of its
      obligations under the Finance Documents:

     

    
      	
              (a)

            	
              to
                be indemnified by the Account Party;
                and/or

            

    

     

    
      	
              (b)

            	
              to
                claim any contribution from any other Guarantor of the Account Party’s
                obligations under the Finance Documents;
                and/or

            

    

     

    
      	
              (c)

            	
              to
                take the benefit (in whole or in part and whether by way of subrogation
                or
                otherwise) of any rights of the Finance Parties under the Finance
                Documents or of any other security taken pursuant to, or in connection
                with, this Agreement by all or any of the Finance
                Documents.

            

    

     

    
      
        
        

      

      
        -30-

        
          

        

      

      
        
        

      

    

     

    
      Rights
        of Contribution

       

    

    16.8           The
      Guarantors (other than the Account Party) hereby agree, as between themselves,
      that if any such Guarantor shall become an Excess Funding Guarantor (as defined
      below) by reason of the payment by such Guarantor of any Guaranteed Obligations,
      each other Guarantor (other than the Account Party) shall, on demand of such
      Excess Funding Guarantor (but subject to the next sentence), pay to such Excess
      Funding Guarantor an amount equal to such Guarantor’s Pro Rata Share (as defined
      below and determined, for this purpose, without reference to the properties,
      debts and liabilities of such Excess Funding Guarantor) of the Excess Payment
      (as defined below) in respect of such Guaranteed Obligations. The payment
      obligation of a Guarantor to any Excess Funding Guarantor under this Clause
      shall be subordinate and subject in right of payment to the prior payment in
      full of the obligations of such Guarantor under the other provisions of this
      Clause 16 and such Excess Funding Guarantor shall not exercise any right or
      remedy with respect to such excess until payment and satisfaction in full of
      all
      of such obligations.

     

    For
      purposes of this Clause, (i) Excess Funding
      Guarantor means, in respect of any Guaranteed Obligations, a
      Guarantor that has paid an amount in excess of its Pro Rata Share of such
      Guaranteed Obligations, (ii) Excess Payment means, in
      respect of any Guaranteed Obligations, the amount paid by an Excess Funding
      Guarantor in excess of its Pro Rata Share of such Guaranteed Obligations and
      (iii) Pro Rata Share means, for any Guarantor, the
      ratio (expressed as a percentage) of (x) the amount by which the aggregate
      present fair saleable value of all properties of such Guarantor (excluding
      any
      shares of stock of any other Guarantor) exceeds the amount of all the debts
      and
      liabilities of such Guarantor (including contingent, subordinated, unmatured
      and
      unliquidated liabilities, but excluding the obligations of such Guarantor
      hereunder and any obligations of any other Guarantor that have been Guaranteed
      by such Guarantor) to (y) the amount by which the aggregate fair saleable value
      of all properties of all of the Guarantors (other than the Account Party)
      exceeds the amount of all the debts and liabilities (including contingent,
      subordinated, unmatured and unliquidated liabilities, but excluding the
      obligations of the Guarantors under this Clause16) of all of the Guarantors
      (other than the Account Party), determined (A) with respect to any Guarantor
      that is a party hereto on the date hereof, as of the date hereof, and (B) with
      respect to any other Guarantor, as of the date such Guarantor becomes a
      Guarantor hereunder.

     

    General
      Limitation on Guarantee Obligations

     

    16.9           In
      any action or proceeding involving any state corporate Law, or any state or
      Federal bankruptcy, insolvency, reorganisation or other Law in any other
      jurisdiction affecting the rights of creditors generally, if the obligations
      of
      any Guarantor under Clause 16.1 (Guarantee and Indemnity) would
      otherwise, taking into account the provisions of Clause 16.8, be held or
      determined to be void, invalid or unenforceable, or subordinated to the claims
      of any other creditors, on account of the amount of its liability under
      Clause 16.1 (Guarantee and Indemnity), then, notwithstanding any
      other provision hereof to the contrary, the amount of such liability shall,
      without any further action by such Guarantor, any Lender, the Agent or any
      other
      Person, be automatically limited and reduced to the highest amount that is
      valid
      and enforceable and not subordinated to the claims of other creditors as
      determined in such action or proceeding.

     

    Appropriations

     

    16.10           Until
      all amounts which may be or become payable by the Obligors under or in
      connection with the Finance Documents have been irrevocably paid in full, each
      Finance Party (or any trustee or agent on its behalf) may:

     

    
      	
              (a)

            	
              refrain
                from applying or enforcing any other moneys, security or rights held
                or
                received by that Finance Party (or any trustee or agent on its behalf)
                in
                respect of those amounts, or apply and enforce the same in such manner
                and
                order as it sees fit (whether against those amounts or otherwise)
                and,
                until all such amounts have been irrevocably paid in full, no Guarantor
                shall be entitled to the benefit of the same;
                and

            

    

     

    
      	
              (b)

            	
              hold
                in an interest-bearing suspense account any money received from any
                Guarantor or on account of any Guarantor’s liability under this Clause 16
                until all such amounts have been irrevocably paid in full, after
                which
                time any balance left in such account (including accrued interest,
                if any)
                shall be deemed the property of and will be repaid to the relevant
                Guarantor.

            

    

     

    
      
        
        

      

      
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    17.      REPRESENTATIONS
      AND
      WARRANTIES

    17.1           Each
      Obligor represents and warrants to the Lenders on the date of this Agreement,
      the Closing Date and on 1 September of each year unless all of the Letters
      of
      Credit will terminate on or before the fourth anniversary of such date (with
      reference to the facts and circumstances subsisting on each such date) as
      follows.

     

    Organisation;
      Powers

     

    17.2           It
      and each of its Significant Subsidiaries is duly organised, validly existing
      and
      in good standing under the Laws of the jurisdiction of its organisation, has
      all
      requisite power and authority to carry on its business as now conducted and,
      except where the failure to do so, individually or in the aggregate, could
      not
      reasonably be expected to result in a Material Adverse Effect, is qualified
      to
      do business in, and is in good standing in, every jurisdiction where such
      qualification is required.

     

    Authorisation;
      Enforceability

     

    17.3           The
      Transactions are within such Obligor’s corporate powers and have been duly
      authorised by all necessary corporate and, if required, by all necessary
      shareholder action. Each Finance Document to which such Obligor is party has
      been duly executed and delivered by such Obligor and constitutes a legal, valid
      and binding obligation of such Obligor, enforceable against such Obligor in
      accordance with its terms, except as such enforceability may be limited by
      (a)
      bankruptcy, insolvency, reorganisation, moratorium or similar Laws of general
      applicability affecting the enforcement of creditors’ rights and (b) the
      application of general principles of equity (regardless of whether such
      enforceability is considered in a proceeding in equity or at law).

     

    Governmental
      Approvals; No Conflicts

     

    17.4           The
      Transactions (a) do not require any consent or approval of (including any
      exchange control approval), registration or filing with, or any other action
      by,
      any Governmental Authority, except such as have been obtained or made and are
      in
      full force and effect, (b) will not violate any applicable Law or regulation
      or
      the charter, by-laws or other organisational documents of such Obligor or any
      of
      its Significant Subsidiaries or any order of any Governmental Authority, (c)
      will not violate or result in a default under any material indenture, agreement
      or other instrument binding upon such Obligor or any of its Significant
      Subsidiaries or assets, or give rise to a right thereunder to require any
      payment to be made by any such Person, and (d) will not result in the creation
      or imposition of any Lien on any asset of such Obligor or any of its Significant
      Subsidiaries.

     

    Financial
      Condition; No Material Adverse Change

     

    
      	
              17.5
                (a)

            	
              Financial
                Condition. The Account Party has heretofore furnished to the
                Lenders the consolidated balance sheet and statements of income,
                stockholders’ equity and cash flows of the Account Party and its
                consolidated Subsidiaries (A) as of and for the fiscal year ended
                December
                31, 2006, reported on by PricewaterhouseCoopers LLP, independent
                public
                accountants (as provided in the Account Party’s Report on Form 10-K filed
                with the SEC for the fiscal year ended December 31, 2006, and (B)
                as of
                and for the fiscal quarter ended September 30, 2007, as provided
                in the
                Account Party’s Report on Form 10-Q filed with the SEC for the fiscal
                quarter ended September 30, 2007.  Such financial statements
                present fairly, in all material respects, the financial position
                and
                results of operations and cash flows of the Account Party and its
                respective consolidated Subsidiaries as of such dates and for such
                periods
                in accordance with GAAP or (in the case of XL Insurance or XL Re)
                SAP,
                subject to year-end audit adjustments and the absence of footnotes
                in the
                case of the statements referred to in Clause (B) of the first sentence
                of
                this paragraph.

            

    

     

    
      	
              (b)

            	
              No
                Material Adverse Change. Since December 31, 2006, there has been
                no material adverse change in the assets, business, financial condition
                or
                operations of such Obligor and its Subsidiaries, taken as a whole,
                except
                as disclosed in the Account Party’s filings with the
                SEC.

            

    

     

    Properties

     

    
      	
              17.6
                (a)

            	
              Property
                Generally. Such Obligor and each of its Significant Subsidiaries
                has good title to, or valid leasehold interests in, all its real
                and
                personal property material to its business, subject only to Liens
                permitted

            

    

     

    
      
        
        

      

      
        -32-

        
          

        

      

      
        
        

      

    

    
      	
               

            	
              by
                Clause 19.3 (Liens) and except for minor defects in title that do
                not interfere with its ability to conduct its business as currently
                conducted or to utilise such properties for their intended
                purposes.

            

    

     

    
      	
              (b)

            	
              Intellectual
                Property. Such Obligor and each of its Significant Subsidiaries
                owns, or is licensed to use, all trademarks, tradenames, copyrights,
                patents and other intellectual property material to its business,
                and the
                use thereof by such Obligor and its Significant Subsidiaries does
                not
                infringe upon the rights of any other Person, except for any such
                infringements that, individually or in the aggregate, could not reasonably
                be expected to result in a Material Adverse
                Effect.

            

    

     

    Litigation
      and Environmental Matters

     

    
      	
              17.7
                (a)

            	
              Actions,
                Suits and Proceedings. Except as disclosed in 2 or as disclosed
                in the Account Party’s filings with the SEC, or as routinely encountered
                in claims activity, there are no actions, suits or proceedings by
                or
                before any arbitrator or Governmental Authority now pending against
                or, to
                the knowledge of such Obligor, threatened against or affecting such
                Obligor or any of its Subsidiaries (x) as to which there is a reasonable
                possibility of an adverse determination and that could reasonably
                be
                expected, individually or in the aggregate, to result in a Material
                Adverse Effect or (y) that involve the Finance Documents or the
                Transactions.

            

    

     

    
      	
              (b)

            	
              Environmental
                Matters. Except as disclosed in 2 and except with respect to any
                other matters that, individually or in the aggregate, could not reasonably
                be expected to result in a Material Adverse Effect, neither such
                Obligor
                nor any of its Subsidiaries (i) has failed to comply with any
                Environmental Law or to obtain, maintain or comply with any permit,
                license or other approval required for its business under any
                Environmental Law, (ii) has incurred any Environmental Liability,
                (iii)
                has received notice of any claim with respect to any Environmental
                Liability or (iv) knows of any basis for any Environmental
                Liability.

            

    

     

    
      	
              (c)

            	
              This
                Clause 17.7 and Schedule 2 (in relation to this Clause 17.7 only)
                shall be
                deemed automatically updated from time to time to include disclosures
                included in filings made by the Account Party with the SEC pursuant
                to the
                Securities Exchange Act of 1934, as amended, after the Closing Date,
                it
                being understood, however, that any such updates shall not affect
                or limit
                in any manner any of the obligations of the Obligors under this Agreement
                in effect immediately prior to such disclosure and shall not be taken
                into
                account for purposes of clauses 4.6(a)(ii) and
                20(b).

            

    

     

    Compliance
      with Laws and Agreements

     

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

     

    Investment
      and Holding Company Status

     

    17.9           Such
      Obligor is not an investment
      company as defined in, or subject to
      regulation under, the Investment Company Act of 1940.

     

    Taxes

     

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

     

    ERISA

     

    
      
        
        

      

      
        -33-

        
          

        

      

      
        
        

      

    

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

     

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

     

    Disclosure

     

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

     

    Use
      of Credit

     

    17.13           Neither
      such Obligor nor any of its Subsidiaries is engaged principally, or as one
      of
      its important activities, in the business of extending credit for the purpose,
      whether immediate, incidental or ultimate, of buying or carrying Margin Stock,
      and no Letter of Credit will be used in connection with buying or carrying
      any
      Margin Stock.

     

    Subsidiaries

     

    17.14           Set
      forth in Schedule 3 is a complete and correct list of all of the Subsidiaries
      of
      the Account Party as of September 30, 2007, together with, for each such
      Subsidiary, (i) the jurisdiction of organisation of such Subsidiary, (ii) each
      Person holding ownership interests in such Subsidiary and (iii) the percentage
      of ownership of such Subsidiary represented by such ownership interests. Except
      as disclosed in Schedule 3, (x) each of the Account Party and its Subsidiaries
      owns, free and clear of Liens, and has the unencumbered right to vote, all
      outstanding ownership interests in each Person shown to be held by it in
      Schedule 3, (y) all of the issued and outstanding capital stock of each such
      Person organised as a corporation is validly issued, fully paid and
      nonassessable and (z) except as disclosed in filings of the Account Party with
      the SEC prior to the date hereof, there are no outstanding Equity Rights with
      respect to any Obligor.

     

    Withholding
      Taxes

     

    17.15           Based
      upon information with respect to each Lender provided by each Lender to the
      Agent, as of the date hereof, the payment of the LC Disbursements and interest
      thereon, the fees under Clause 0 (Fees) and all other amounts
      payable hereunder will not be subject, by withholding or deduction, to any
      Taxes
      imposed by any Obligor Jurisdiction.

     

    Stamp
      Taxes

     

    17.16           To
      ensure the legality, validity, enforceability or admissibility in evidence
      of
      the Finance Documents, it is not necessary that the Finance Documents or any
      other document be filed or recorded with any Governmental Authority or that
      any
      stamp or similar tax be paid on or in respect of any of the Finance Documents,
      or any other document other than such filings and recordations that have already
      been made and such stamp or similar taxes that have already been
      paid.

     

    
      
        
        

      

      
        -34-

        
          

        

      

      
        
        

      

    

    Legal
      Form

     

    17.17           The
      Finance Documents are in proper legal form under the Laws of any Obligor
      Jurisdiction for the admissibility thereof in the courts of such Obligor
      Jurisdiction.

     

    Claims
      Pari Passu

     

    17.18           Under
      the Laws of its jurisdiction of incorporation in force at the date hereof,
      the
      claims of the Finance Parties against it under this Agreement or any other
      Finance Document will rank at least pari passu with the claims of all its other
      unsecured and unsubordinated creditors save (i) those whose claims are preferred
      solely by any bankruptcy, insolvency, liquidation or other similar Laws of
      general application; and (ii) with respect to XL Re only, those claims required
      to be preferred by and under the Bermuda Insurance Act 1978.

     

    18.    AFFIRMATIVE
      COVENANTS

     

    Until
      the
      Commitments have expired or been terminated and all fees payable hereunder
      shall
      have been paid in full and all Letters of Credit shall have expired or
      terminated and all LC Disbursements shall have been reimbursed, the Obligors
      covenant and agree with the Lenders that:

     

    Financial
      Statements and Other Information

     

    18.1           Each
      Obligor will furnish to the Agent and each Lender:

     

    
      	
              (a)

            	
              (i)
                by April 10 of each year, the audited balance sheet and related statements
                of operations, stockholders’ equity and cash flows of the Account Party
                and its consolidated Subsidiaries as of the end of and for the immediately
                preceding fiscal year, setting forth in comparative form the figures
                for
                (or, in the case of the balance sheet, as of the end of) the previous
                fiscal year (if such figures were already produced for such corresponding
                period), reported on by independent public accountants of recognized
                national standing (without a “going concern” or like qualification or
                exception and without any qualification or exception as to the scope
                of
                such audit) to the effect that such financial statements present
                fairly in
                all material respects the financial condition and results of operations
                of
                the Account Party and its consolidated Subsidiaries on a consolidated
                basis in accordance with GAAP consistently applied (it being understood
                that delivery to the Lenders of the Account Party’s Report on Form 10-K
                filed with the SEC shall satisfy the financial statement delivery
                requirements under this clause (i) so long as the financial information
                required to be contained in such report is substantially the same
                as the
                financial information required under this clause (i)); and (ii) by
                May 15
                of each year, the audited balance sheet and related statements of
                operations, stockholders’ equity and cash flows of each of XL Insurance
                and XL Re as of the end of and for the immediately preceding year,
                setting
                forth in each case in comparative form the figures for (or, in the
                case of
                the balance sheet, as of the end of) the previous fiscal year (if
                such
                figures were already produced for such corresponding period), in
                each case
                reported on by independent public accountants of recognized national
                standing (without a “going concern” or like qualification or exception and
                without any qualification or exception as to the scope of such audit)
                to
                the effect that such financial statements present fairly in all material
                respects the financial condition and results of operations of XL
                Insurance
                or XL Re, as the case may be, in accordance with SAP consistently
                applied;

            

    

     

    
      	
              (b)

            	
              by
                June 15 of each year, (i) the unaudited consolidated balance sheet
                and
                related statements of operations, stockholders’ equity and cash flows of
                XL America and its consolidated Subsidiaries as of the end of and
                for the
                immediately preceding fiscal year, setting forth in each case in
                comparative form the figures for (or, in the case of the balance
                sheet, as
                of the end of) the previous fiscal year (if such figures were already
                produced for such corresponding period), certified by a Financial
                Officer
                of XL America as presenting fairly in all material respects the financial
                condition and results of operations of XL America and its consolidated
                Subsidiaries on a consolidated basis in accordance with GAAP consistently
                applied, subject to normal year-end audit adjustments and the absence
                of
                footnotes; and (ii) audited statutory financial statements for each
                Insurance Subsidiary of XL America as of the end of and for the
                immediately preceding fiscal year, in each case reported on by independent
                public accountants of recognized national standing (without a “going
                co

            

    

     

    
      
        
        

      

      
        -35-

        
          

        

      

      
        
        

      

    

    
      	
               

            	
              cern”
                or like qualification or exception and without any qualification
                or
                exception as to the scope of such audit) to the effect that such
                audited
                financial statements present fairly in all material respects the
                financial
                condition and results of operations of such Insurance Subsidiary
                in
                accordance with SAP consistently
                applied;

            

    

     

    
      	
              (c)

            	
              within
                60 days after the end of each of the first three fiscal quarters
                of each
                fiscal year of the Account Party, (i) the unaudited consolidated
                balance
                sheet and related statements of operations, stockholders’ equity and cash
                flows of the Account Party and its consolidated Subsidiaries as of
                the end
                of and for such fiscal quarter and the then elapsed portion of the
                fiscal
                year, setting forth in each case in comparative form the figures
                for (or,
                in the case of the balance sheet, as of the end of) the corresponding
                period or periods of the previous fiscal year (if such figures were
                already produced for such corresponding period or periods), all certified
                by a Financial Officer of the Account Party as presenting fairly
                in all
                material respects the financial condition and results of operations
                of the
                Account Party and its consolidated Subsidiaries on a consolidated
                basis in
                accordance with GAAP consistently applied, subject to normal year-end
                audit adjustments and the absence of footnotes (it being understood
                that
                delivery to the Lenders of the Account Party’s Report on Form 10-Q filed
                with the SEC shall satisfy the financial statement delivery requirements
                under this paragraph (i) so long as the financial information required
                to
                be contained in such report is substantially the same as the financial
                information required under this paragraph (i)); and (ii) an unaudited
                consolidated balance sheet and related statements of operations,
                stockholders’ equity and cash flows of each of XL America, XL Insurance
                and XL Re and its consolidated Subsidiaries as of the end of and
                for such
                fiscal quarter and the then elapsed portion of the fiscal year, setting
                forth in each case in comparative form the figures for (or, in the
                case of
                the balance sheet, as of the end of) the corresponding period or
                periods
                of the previous fiscal year (if such figures were already produced
                for
                such corresponding period or periods), all certified by a Financial
                Officer of the respective Obligor as presenting fairly in all material
                respects the financial condition and results of operations of such
                Obligor
                and its consolidated Subsidiaries on a consolidated basis in accordance
                with GAAP consistently applied, subject to normal year-end audit
                adjustments and the absence of
                footnotes;

            

    

     

    
      	
              (d)

            	
              concurrently
                with any delivery of financial statements under Clause18.1(a), (b)
                or (c),
                a certificate signed on behalf of each Obligor by a Financial Officer
                (i)
                certifying as to whether a  Default has occurred and, if a
                Default has occurred, specifying the details thereof and any action
                taken
                or proposed to be taken with respect thereto, (ii) setting forth
                reasonably detailed calculations demonstrating compliance with
                Clauses 19.3 (Liens), 19.5 (Ratio of Total Funded Debt
                to Total Capitalisation), 19.6 (Consolidated Net Worth) and
                19.7 (Indebtedness) and (iii) stating whether any change in GAAP
                or (in the case of XL Insurance, XL Re and any Insurance Subsidiary
                of XL
                America) SAP or in the application thereof has occurred since the
                date of
                the audited financial statements referred to in Clause 17.5(a) and,
                if any
                such change has occurred, specifying any material effect of such
                change on
                the financial statements accompanying such
                certificate;

            

    

     

    
      	
              (e)

            	
              concurrently
                with any delivery of financial statements under Clause 18.1(a) and
                (b)(ii), a certificate of the accounting firm that reported on such
                financial statements stating whether they obtained knowledge during
                the
                course of their examination of such financial statements of any Default
                (which certificate may be limited to the extent required by accounting
                rules or guidelines);

            

    

     

    
      	
              (f)

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

            

    

     

    
      	
              (g)

            	
              concurrently
                with any delivery of financial statements under Clause18.1(a), (b)
                or (c)
                a certificate of a Financial Officer of the Account Party, setting
                forth
                on a consolidated basis for the Account Party and its consolidated
                Subsidiaries as of the end of the fiscal year or quarter to which
                such
                certificate relates (i) the aggregate book value of assets which
                are
                subject to Liens permitted under Clause 19.3(g) (Liens) and the
                aggregate book value of liabilities which are subject to Liens permitted
                under Clause 19.3(g) (it being understood that the reports required
                by
                paragraphs (a), (b) and (c) of this Clause shall satisfy the requirement
                of this Clause (i) of this Clause 18.1(g) if such reports set forth
                separately, in accordance with GAAP, line items corresponding to
                such
                aggregate book values) and (ii) a calculation showing the portion
                of each
                of

            

    

     

    
      
        
        

      

      
        -36-

        
          

        

      

      
        
        

      

    

    
      	
               

            	
              such
                aggregate amounts which portion is attributable to transactions among
                wholly-owned Subsidiaries of the Account
                Party;

            

    

     

    
      	
              (h)

            	
              within
                90 days after the end of each of the first three fiscal quarters
                of each
                fiscal year and within 135 days after the end of each fiscal year
                of the
                Account Party (commencing with the fiscal year ending December 31,
                2007) a
                statement of a Financial Officer of the Account Party listing, as
                of the
                end of the immediately preceding fiscal quarter of the Account Party,
                the
                amount of cash and the securities of the Obligors and their Subsidiaries
                that have been posted as collateral under Clause19.3(f);
                and

            

    

     

    
      	
              (i)

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

            

    

     

    “Know
      your customer” checks

     

    
      	
              18.2(a)

            	
              If:

            

    

     

    
      	
               

            	
              (i)

            	
              the
                introduction of or any change in (or in the interpretation, administration
                or application of) any law or regulation made after the date of this
                Agreement;

            

    

     

    
      	
               

            	
              (ii)

            	
              any
                change in the status of an Obligor after the date of this Agreement;
                or

            

    

     

    
      	
               

            	
              (iii)

            	
              a
                proposed assignment or transfer by a Lender of any of its rights
                and
                obligations under this Agreement to a party that is not a Lender
                prior to
                such assignment or transfer,

            

    

     

    obliges
      the Agent or any Lender (or, in the case of paragraph (iii) above, any
      prospective new Lender) to comply with “know your customer” or similar
      identification procedures in circumstances where the necessary information
      is
      not already available to it, each Obligor shall promptly upon the request of
      the
      Agent or any Lender supply, or procure the supply of, such documentation and
      other evidence as is reasonably requested by the Agent (for itself or on behalf
      of any Lender) or any Lender (for itself or, in the case of the event described
      in paragraph (iii) above, on behalf of any prospective new Lender) in order
      for
      the Agent, such Lender or, in the case of the event described in paragraph
      (iii)
      above, any prospective new Lender to carry out and be satisfied it has complied
      with all necessary “know your customer” or other similar checks under all
      applicable laws and regulations pursuant to the transactions contemplated in
      the
      Finance Documents.

     

    
      	
              (b)

            	
              Each
                Lender shall promptly upon the request of the Agent supply, or procure
                the
                supply of, such documentation and other evidence as is reasonably
                requested by the Agent (for itself) in order for the Agent to carry
                out
                and be satisfied it has complied with all necessary “know your customer”
                or other similar checks under all applicable laws and regulations
                pursuant
                to the transactions contemplated in the Finance
                Documents.

            

    

     

    Notices
      of Material Events

     

    18.3           Each
      Obligor will furnish to the Agent and each Lender prompt written notice of
      the
      following:

     

    
      	
              (a)

            	
              the
                occurrence of any Default; and

            

    

     

    
      	
              (b)

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

            

    

     

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

     

    
      
        
        

      

      
        -37-

        
          

        

      

      
        
        

      

    

    
      Preservation
        of Existence and Franchises

       

    

    

      18.4           Each
        Obligor will, and will cause each of its Significant Subsidiaries to, maintain
        its corporate existence and its material rights and franchises in full force
        and
        effect in its jurisdiction of incorporation except where the failure to maintain
        such corporate existence and material rights and franchises would not reasonably
        be expected to have, either individually or in the aggregate, a Material
        Adverse
        Effect; provided that the foregoing shall not prohibit any merger or
        consolidation permitted under Clause 19.1 (Mergers) or 19.2
        (Dispositions). Each Obligor will, and will cause each of its
        Significant Subsidiaries to, qualify and remain qualified as a foreign
        corporation in each jurisdiction in which failure to receive or retain such
        qualification would have a Material Adverse Effect.

       

    

    Insurance

     

    18.5           Each
      Obligor will, and will cause each of its Significant Subsidiaries to, maintain
      with financially sound and reputable insurers, insurance with respect to its
      properties in such amounts as is customary in the case of corporations engaged
      in the same or similar businesses having similar properties similarly
      situated.

     

    Maintenance
      of Properties

     

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

     

    Payment
      of Taxes and Other Potential Charges and Priority Claims Payment of Other
      Current Liabilities

     

    18.7           Each
      Obligor will, and will cause each of its Subsidiaries to, pay or
      discharge:

     

    
      	
              (a)

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

            

    

     

    
      	
              (b)

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

            

    

     

    
      	
              (c)

            	
              on
                or prior to the date when due, all other lawful claims which, if
                unpaid,
                might result in the creation of a Lien upon any such property (other
                than
                Liens not forbidden by Clause 19.3 (Liens)) or which, if unpaid,
                might give rise to a claim entitled to priority over general creditors
                of
                such Obligor or such Subsidiary in any proceeding under the Bermuda
                Companies Law or Bermuda Insurance Law, or any insolvency proceeding,
                liquidation, receivership, rehabilitation, dissolution or winding-up
                involving such Obligor or such
                Subsidiary;

            

    

     

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

     

    Financial
      Accounting Practices

     

    18.8           Such
      Obligor will, and will cause each of its consolidated Subsidiaries to, make
      and
      keep books, records and accounts which, in reasonable detail, accurately and
      fairly reflect its transactions and dispositions of its assets and maintain
      a
      system of internal accounting controls sufficient to provide reasonable
      assurances that transactions

     

    
      
        
        

      

      
        -38-

        
          

        

      

      
        
        

      

    

    are
      recorded as necessary to permit preparation of financial statements required
      under Clause 18.1 (Financial Statements and Other Information) in
      conformity with GAAP and SAP, as applicable, and to maintain accountability
      for
      assets.

     

    Compliance
      with Applicable Laws

     

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

     

    Use
      of Letters of Credit and Proceeds

     

    18.10           No
      Letter of Credit will be used, whether directly or indirectly, for any purpose
      that entails a violation of any of the Regulations of the Board, including
      Regulations U and X.  Each Applicant will use the Letters of Credit
      issued for its account hereunder in the ordinary course of business of such
      Applicant and its Affiliates. For the avoidance of doubt, the Parties agree
      that
      the Account Party may apply for a Letter of Credit hereunder to support the
      obligations of any Affiliate of an Applicant, it being understood that the
      Account Party shall nonetheless remain the Obligor and as such be liable with
      respect to such Letter of Credit.

     

    Continuation
      of and Change in Businesses

     

    18.11           Each
      Obligor and its Significant Subsidiaries will continue to engage in
      substantially the same business or businesses that they engaged in (or propose
      to engage in) on the date of this Agreement and businesses related or incidental
      thereto.

     

    Visitation

     

    18.12           Each
      Obligor will permit such Persons as any Lender may reasonably designate to
      visit
      and inspect any of the properties of such Obligor, to discuss its affairs with
      its financial management, and provide such other information relating to the
      business and financial condition of such Obligor at such times as such Lender
      may reasonably request. Each Obligor hereby authorises its financial management
      to discuss with any Lender the affairs of such Obligor.

     

    19.    NEGATIVE
      COVENANTS

     

    Until
      the
      Total Commitments have expired or terminated and all fees payable hereunder
      have
      been paid in full and all Letters of Credit have expired or terminated and
      all
      LC Disbursements have been reimbursed, each of the Obligors covenants and agrees
      with the Lenders that:

     

    Mergers

     

    19.1           No
      Obligor will merge with or into or consolidate with any other Person, except
      that if no Default shall occur and be continuing or shall exist at the time
      of
      such merger or consolidation or immediately thereafter and after giving effect
      thereto:

     

    
      	
              (a)

            	
              any
                Obligor may merge or consolidate with any other corporation, including
                a
                Subsidiary, if such Obligor shall be the surviving
                corporation;

            

    

     

    
      	
              (b)

            	
              the
                Account Party may merge with or into or consolidate with any other
                Person
                in a transaction that does not result in a reclassification, conversion,
                exchange or cancellation of the outstanding shares of capital stock
                of the
                Account Party (other than the cancellation of any outstanding shares
                of
                capital stock of the Account Party held by the Person with whom it
                merges
                or consolidates); and

            

    

     

    
      
        
        

      

      
        -39-

        
          

        

      

      
        
        

      

    

    
      	
              (c)

            	
              any
                Obligor may enter into a merger or consolidation which is effected
                solely
                to change the jurisdiction of incorporation of such Obligor and results
                in
                a reclassification, conversion or exchange of outstanding shares
                of
                capital stock of such Obligor solely into shares of capital stock
                of the
                surviving entity.

            

    

     

    Dispositions

     

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

     

    
      	
              (a)

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

            

    

     

    
      	
              (b)

            	
              sales,
                conveyances, assignments or other transfers or dispositions in immediate
                exchange for cash or tangible assets, provided that any such sales,
                conveyances or transfers shall not individually, or in the aggregate
                for
                the Obligor and their respective Subsidiaries, exceed $500,000,000
                in any
                calendar year;

            

    

     

    
      	
              (c)

            	
              Dispositions
                of equipment or other property which is obsolete or no longer used
                or
                useful in the conduct of the business of such Obligor or its
                Subsidiaries;

            

    

     

    
      	
              (d)

            	
              Dispositions
                between or among the Obligors and their wholly owned Subsidiaries;
                or

            

    

     

    
      	
              (e)

            	
              Dispositions
                with Affiliates in accordance with Clause 19.4(c) (Transactions
                with Affiliates).

            

    

     

    Liens

     

    19.3           No
      Obligor will, nor will it permit any of its Subsidiaries to, create, incur,
      assume or permit to exist any Lien on any property or assets, tangible or
      intangible, now owned or hereafter acquired by it, except:

     

    
      	
              (a)

            	
              Liens
                listed in Part B of Schedule 2 (and extension, renewal and replacement
                Liens upon the same property, provided that the amount secured by
                each
                Lien constituting such an extension, renewal or replacement Lien
                shall not
                exceed the amount secured by the Liens listed in Part B of Schedule
                2);

            

    

     

    
      	
              (b)

            	
              Liens
                arising from taxes, assessments, charges, levies or claims described
                in
                Clause 18.7 (Payment of Taxes and other potential charges and priority
                claims, payments of other current liabilities) that are not yet due
                or that remain payable without penalty or to the extent permitted
                to
                remain unpaid under the provision of Clause
                18.7;

            

    

     

    
      	
              (c)

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

            

    

     

    
      	
              (d)

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

            

    

     

    
      	
              (e)

            	
              Liens
                securing Indebtedness permitted by Clause 19.7(b) (Indebtedness)
                covering assets whose market value is not materially greater than
                the
                amount of the Indebtedness secured thereby plus a commercially reasonable
                margin;

            

    

     

    
      
        
        

      

      
        -40-

        
          

        

      

      
        
        

      

    

    
      	
              (f)

            	
              Liens
                on cash and securities of an Obligor or any of its Subsidiaries incurred
                as part of the management of its investment portfolio including,
                but not
                limited to, pursuant to any International Swaps and Derivatives
                Association, Inc. (ISDA) documentation or any
                Specified Transaction Agreement in accordance with the Account Party’s
                Statement of Investment Policy Objectives and Guidelines as in effect
                on
                the date hereof or as it may be changed from time to time by resolution
                duly adopted by the board of directors of the Account Party (or any
                committee thereof);

            

    

     

    
      	
              (g)

            	
              Liens
                on cash and securities not to exceed $500,000,000 in the aggregate
                securing obligations of an Obligor or any of its Subsidiaries arising
                under any ISDA documentation or any other Specified Transaction Agreement
                (it being understood that in no event shall this paragraph (g) preclude
                any Person (other than any Subsidiary of the Account Party) in which
                the
                Account Party or any of its Subsidiaries shall invest (each an
                investee) from granting Liens on such Person’s
                assets to secure hedging obligations of such Person, so long as such
                obligations are non-recourse to the Account Party or any of its
                Subsidiaries (other than any investees)), provided that, for purposes
                of
                determining the aggregate amount of cash and/or securities subject
                to such
                Liens under this paragraph (g) the aggregate amount of cash and/or
                securities on which any Obligor or any Subsidiary shall have granted
                a
                Lien in favour of a counterparty at any time shall be netted against
                the
                aggregate amount of cash and/or securities on which such counterparty
                shall have granted a Lien in favour of such Obligor or Subsidiary,
                as the
                case may be, at such time, so long as the relevant agreement between
                such
                Obligor or such Subsidiary, as the case may be, provides for the
                netting
                of their respective obligations
                thereunder;

            

    

     

    
      	
              (h)

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

            

    

     

    
      	
              (i)

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

            

    

     

    
      	
              (j)

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

            

    

     

    Transactions
      with Affiliates

     

    19.4           No
      Obligor will, nor will it permit any of its Significant Subsidiaries to, enter
      into or carry out any transaction with (including, without limitation, purchase
      or lease property or services to, loan or advance to or enter into,

     

    
      
        
        

      

      
        -41-

        
          

        

      

      
        
        

      

    

    suffer
      to
      remain in existence or amend any contract, agreement or arrangement with) any
      Affiliate of such Obligor, or directly or indirectly agree to do any of the
      foregoing, except:

     

    
      	
              (a)

            	
              transactions
                involving guarantees or co-obligors with respect to any Indebtedness
                described in Part A of Schedule 2;

            

    

     

    
      	
              (b)

            	
              transactions
                between any Obligor and its wholly-owned Subsidiaries;
                and

            

    

     

    
      	
              (c)

            	
              transactions
                with Affiliates in good faith in the ordinary course of such Obligor’s
                business consistent with past practice and on terms no less favourable
                to
                such Obligor or any Subsidiary than those that could have been obtained
                in
                a comparable transaction on an arm’s length basis from an unrelated
                Person.

            

    

     

    Ratio
      of Total Funded Debt to Total Capitalisation

     

    19.5           The
      Account Party will not permit its ratio of (a) Total Funded Debt to (b) the
      sum
      of Total Funded Debt plus Consolidated Net Worth to be greater than 0.35:1.00
      at
      any time.

     

    Consolidated
      Net Worth

     

    19.6           The
      Account Party will not permit its Consolidated Net Worth to be less than the
      sum
      of (a) $6,000,000,000 plus (b) 25% of consolidated net income (if positive)
      of
      the Account Party and its Subsidiaries for each fiscal quarter ending on or
      after 30 June, 2007.

     

    Indebtedness

     

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

     

    
      	
              (a)

            	
              Indebtedness
                created hereunder and under any other Finance
                Document;

            

    

     

    
      	
              (b)

            	
              secured
                Indebtedness (including secured reimbursement obligations with respect
                to
                letters of credit) of any Obligor or any Subsidiary in an aggregate
                principal amount (for all Obligors and their respective Subsidiaries)
                not
                exceeding at any time outstanding 15% of Consolidated Net
                Worth;

            

    

     

    
      	
              (c)

            	
              other
                unsecured Indebtedness, so long as upon the incurrence thereof no
                Default
                would occur or exist;

            

    

     

    
      	
              (d)

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

            

    

     

    
      	
              (e)

            	
              Indebtedness
                incurred in transactions described in Clauses 19.3(f) and 19.3(g);
                and

            

    

     

    
      	
              (f)

            	
              Indebtedness
                described in Part A of Schedule 2 and extensions, renewals and
                replacements of any such Indebtedness that do not increase the outstanding
                principal amount thereof.

            

    

     

    Ratings
      Downgrade

     

    19.8           The
      Account Party will not permit the financial-strength rating from A.M. Best
&
Co. or its successor (such rating, an AMB Rating) each
      of the XL Capital Group, XL Insurance and XL Re to fall below “A-” (the
AMB Rating Undertaking). The Agent may (and if so
      instructed by the Majority Lenders shall) require the Account Party within
      5
      Business Days of a failure to comply with the AMB Rating Undertaking,
      either:

     

    
      	
              (a)

            	
              to
                provide cash cover in an amount equal to the aggregate LC Exposures
                for
                the time being; or

            

    

     

    
      
        
        

      

      
        -42-

        
          

        

      

      
        
        

      

    

    
      	
              (b)

            	
              to
                deposit BIS Qualifying Assets with a custodian acceptable to the
                Agent,
                and enter into custodian and other relevant documentation, together
                with
                documentation required by the Security Trustee to give the Security
                Trustee (for the benefit of itself and the other Finance Parties)
                an
                effective and perfected security interest in respect of those BIS
                Qualifying Assets, in an aggregate amount equal to 105% of the aggregate
                LC Exposures for the time being.

            

    

     

    

    
      (each
        of
        (a) and (b), AMBCash
        Collateral).

    

     

    Notwithstanding
      any of the foregoing provisions of this Clause 19.9, if at any time subsequent
      to the Account Party posting AMB Cash Collateral, any of the XL Capital Group,
      XL Insurance and XL Re has an AMB Rating of at least “A”, the Security Trustee
      will instruct a bank holding any cash cover or otherwise take all necessary
      actions to release and return any AMB Cash Collateral to the Account Party
      and
      the Letter of Credit Fee shall be determined by reference to
      Clause 9.3.

     

    Private
      Act

     

    19.9           No
      Obligor will become subject to a Private Act other than the X.L. Insurance
      Company, Ltd. Act, 1989.

     

    20.           EVENTS
      OF DEFAULT

     

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

     

    
      	
              (a)

            	
              Failure
                to Pay:

            

    

     

    
      	
               

            	
              (i)

            	
              any
                Obligor shall fail to pay any Demand Amount when and as the same
                shall
                become due and payable; or

            

    

     

    
      	
               

            	
              (ii)

            	
              any
                Obligor shall fail to pay any interest or any fee payable under this
                Agreement or any other Finance Document or any other amount (other
                than an
                amount referred to in Clause 20(a)(i)) payable under this Agreement
                or any other Finance Document, when and as the same shall become
                due and
                payable, and such failure shall continue unremedied for a period
                of 3 or
                more days;

            

    

     

    
      	
              (b)

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

            

    

     

    
      	
              (c)

            	
              Breach
                of Obligations:

            

    

     

    
      	
               

            	
              (i)

            	
              any
                Obligor shall fail to observe or perform any covenant, condition
                or
                agreement contained in Clause 19 (Negative Covenants) provided
                that any failure by the Account Party to comply with the AMB Rating
                Undertaking shall not constitute an Event of Default unless the Agent
                requires the Account Party to post and maintain AMB Cash Collateral
                in
                accordance with Clause 19.8 (Ratings Downgrade) and the Account
                Party fails to do so within 5 Business Days of such failure to comply
                with
                such AMB Rating Undertaking; or

            

    

     

    
      	
               

            	
              (ii)

            	
              any
                Obligor shall fail to observe or perform any covenant, condition
                or
                agreement contained in this Agreement or any other Finance Document
                (other
                than those specified in Clause 20(a) or (c)(i)) and such failure
                shall
                continue unremedied for a period of 20 or more days after notice
                thereof
                from the Agent (given at the request of any Lender) to such
                Obligor;

            

    

     

    
      	
              (d)

            	
              Cross
                Default:  any Obligor or any of its Subsidiaries shall
                default (i) in any payment of principal of or interest on any other
                obligation for borrowed money in principal amount of $50,000,000
                or more,
                or any payment of any principal amount of $50,000,000 or more under
                Hedging Agreements, in each case beyond any period of grace provided
                with
                respect thereto, or (ii) in the performance of any other agreement,
                term
                or

            

    

     

    
      
        
        

      

      
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              condition
                contained in any such agreement (other than Hedging Agreements) under
                which any such obligation in principal amount of $50,000,000 or more
                is
                created, if the effect of such default is to cause or permit the
                holder or
                holders of such obligation (or trustee on behalf of such holder or
                holders) to cause such obligation to become due prior to its stated
                maturity or to terminate its commitment under such agreement, provided
                that this Clause 20(d) shall not apply to secured Indebtedness that
                becomes due as a result of the voluntary sale or transfer of the
                property
                or assets securing such
                Indebtedness;

            

    

     

    
      	
              (e)

            	
              Winding-up:  a
                decree or order by a court having jurisdiction in the premises shall
                have
                been entered adjudging any Obligor a bankrupt or insolvent, or approving
                as properly filed a petition seeking reorganisation of such Obligor
                under
                the Bermuda Companies Law or the Cayman Islands Companies Law (2007
                Revision) or any other similar applicable Law, and such decree or
                order
                shall have continued undischarged or unstayed for a period of 60
                days; or
                a decree or order of a court having jurisdiction in the premises
                for the
                appointment of a receiver or liquidator or trustee or assignee in
                bankruptcy or insolvency of such Obligor or a substantial part of
                its
                property, or for the winding up or liquidation of its affairs, shall
                have
                been entered, and such decree or order shall have continued undischarged
                and unstayed for a period of 60
                days;

            

    

     

    
      	
              (f)

            	
              Insolvency
                and Rescheduling:  any Obligor shall institute
                proceedings to be adjudicated a voluntary bankrupt, or shall consent
                to
                the filing of a bankruptcy proceeding against it, or shall file a
                petition
                or answer or consent seeking reorganisation under the Bermuda Companies
                Law or the Cayman Islands Companies Law (2007 Revision) or any other
                similar applicable Law, or shall consent to the filing of any such
                petition, or shall consent to the appointment of a receiver or liquidator
                or trustee or assignee in bankruptcy or insolvency of it or a substantial
                part of its property, or shall make an assignment for the benefit
                of
                creditors, or shall admit in writing its inability to pay its debts
                generally as they become due, or corporate or other action shall
                be taken
                by such Obligor in furtherance of any of the aforesaid
                purposes;

            

    

     

    
      	
              (g)

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

            

    

     

    
      	
              (h)

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

            

    

     

    
      	
              (i)

            	
              Change
                of Control:  a Change in Control shall
                occur;

            

    

     

    
      	
              (j)

            	
              Change
                in Ownership:  the Account Party shall cease to own,
                beneficially and of record, directly or indirectly all of the outstanding
                voting shares of capital stock of XL Insurance, XL Re or XL America;
                or

            

    

     

    
      	
              (k)

            	
              Illegality:  at
                any time it is or becomes unlawful for any Obligor to perform or
                comply
                with any or all of its obligations hereunder or any court or arbitrator
                or
                any governmental body, agency or official which has jurisdiction
                in the
                matter shall decide, rule or order that any provision of the Finance
                Documents is invalid or unenforceable in any material respect, or
                any
                Obligor shall so assert in writing;

            

    

     

    
      	
              (l)

            	
              Default
                under Guarantee: the guarantee contained in Clause 16
                (Guarantee and Indemnity) shall terminate or cease, in whole or
                material part, to be a legally valid and binding obligation of each
                Guarantor or any Guarantor or any Person acting for or on behalf
                of any of
                such parties shall contest such validity or binding nature of such
                guarantee itself or the Transactions, or any other Person shall assert
                any
                of the foregoing,

            

    

     

    then,
      and
      in every such event (other than an event with respect to any Obligor described
      in Clause 20(e) or 20(f)), and at any time thereafter during the continuance
      of
      such event, the Agent may, and at the request of the Majority Lenders shall,
      by
      notice to the Account Party (an Acceleration Notice),
      take any of the following actions, at the same or different times:

     

    
      
        
        

      

      
        -44-

        
          

        

      

      
        
        

      

    

    (i)           terminate
      the Total Commitments, and thereupon the Total Commitments shall terminate
      immediately;

     

    
      	
               

            	
              (ii)

            	
              require
                the Account Party forthwith to provide cash cover in respect of any
                LC
                Exposure pursuant to a Letter of Credit;
                and

            

    

     

    
      	
               

            	
              (iii)

            	
              declare
                all fees and other obligations of the Account Party accrued hereunder
                to
                be due and payable in whole (or in part, in which case any fees and
                other
                obligations not so declared to be due and payable may thereafter
                be
                declared to be due and payable) and thereupon such fees and other
                obligations, shall become due and payable immediately, without
                presentment, demand, protest or other notice of any kind, all of
                which are
                hereby waived by the Account Party,

            

    

     

    and
      in
      case of any event with respect to any Obligor described in Clause 20(e) or
      20(f):

     

    
      	
               

            	
              (A)

            	
              the
                Commitments shall automatically terminate;
                and

            

    

     

    
      	
               

            	
              (B)

            	
              the
                Account Party shall automatically be required to provide cash cover
                in
                respect of any LC Exposure pursuant to a Letter of Credit;
                and

            

    

     

    
      	
               

            	
              (C)

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

            

    

     

    21.           THE
      AGENT, THE ARRANGERS AND THE LENDERS

     

    Appointment
      of the Agent

     

    21.1           The
      Arrangers and each of the Lenders hereby appoints the Agent to act as its agent
      in connection herewith and authorises the Agent to exercise such rights, powers,
      authorities and discretions as are specifically delegated to the Agent by the
      terms hereof together with all such rights, powers, authorities and discretions
      as are reasonably incidental thereto.

     

    Agent’s
      Discretions

     

    21.2           The
      Agent may:

     

    
      	
              (a)

            	
              assume,
                unless it has, in its capacity as agent for the Lenders, received
                notice
                to the contrary from any other party hereto, that (a) any representation
                made or deemed to be made by an Obligor in connection with the Finance
                Documents is true, (b) no Event of Default or Potential Event of
                Default
                has occurred, (c) no Obligor is in breach of or default under its
                obligations under the Finance Documents and (d) any right, power,
                authority or discretion vested therein upon the Majority Lenders,
                the
                Lenders or any other person or group of persons has not been
                exercised;

            

    

     

    
      	
              (b)

            	
              assume
                that the Facility Office of each Lender is that notified to it by
                such
                Lender in writing prior to the date hereof (or, in the case of a
                Transferee, at the end of the Transfer Certificate to which it is
                a party
                as Transferee) until it has received from such Lender a notice designating
                some other office of such Lender to replace its Facility Office and
                act
                upon any such notice until the same is superseded by a further such
                notice;

            

    

     

    
      	
              (c)

            	
              engage
                and pay for the advice or services of any lawyers, accountants, surveyors
                or other experts whose advice or services may to it seem necessary,
                expedient or desirable and rely upon any advice so
                obtained;

            

    

     

    
      	
              (d)

            	
              rely
                as to any matters of fact which might reasonably be expected to be
                within
                the knowledge of an Obligor upon a certificate signed by or on behalf
                of
                such Obligor;

            

    

     

    
      	
              (e)

            	
              rely
                upon any communication or document believed by it to be
                genuine;

            

    

     

    
      
        
        

      

      
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              (f)

            	
              refrain
                from exercising any right, power or discretion vested in it as agent
                hereunder unless and until instructed by the Majority Lenders as
                to
                whether or not such right, power or discretion is to be exercised
                and, if
                it is to be exercised, as to the manner in which it should be
                exercised;

            

    

     

    
      	
              (g)

            	
              refrain
                from acting in accordance with any instructions of the Majority Lenders
                to
                begin any legal action or proceeding arising out of or in connection
                with
                the Finance Documents until it shall have received such security
                as it may
                require (whether by way of payment in advance or otherwise) for all
                costs,
                claims, losses, expenses (including legal fees) and liabilities together
                with any VAT thereon which it will or may expend or incur in complying
                with such instructions; and

            

    

     

    
      	
              (h)

            	
              assume
                (unless it has specific notice to the contrary) that any notice or
                request
                made by the Account Party is made on behalf of the
                Obligors.

            

    

     

    Agent’s
      Obligations

     

    21.3           The
      Agent shall:

     

    
      	
              (a)

            	
              promptly
                inform each Lender of the contents of any notice or document received
                by
                it in its capacity as Agent from an Obligor under the Finance Documents
                and shall promptly deliver to each Lender a copy of each Letter of
                Credit
                delivered to Lloyd’s pursuant to Clause 3.3 (Completion of Letters of
                Credit);

            

    

     

    
      	
              (b)

            	
              promptly
                notify each Lender of the occurrence of any Event of Default or any
                default by an Obligor in the due performance of or compliance with
                its
                obligations under the Finance Documents of which the Agent has notice
                from
                any other party hereto;

            

    

     

    
      	
              (c)

            	
              save
                as otherwise provided herein, act as agent under the Finance Documents
                in
                accordance with any instructions given to it by an Majority Lenders,
                which
                instructions shall be binding on the Arrangers and the
                Lenders; and

            

    

     

    
      	
              (d)

            	
              if
                so instructed by the Majority Lenders, refrain from exercising any
                right,
                power or discretion vested in it as agent under the Finance
                Documents.

            

    

     

    The
      Agent’s duties under the Finance Documents are solely mechanical and
      administrative in nature.

     

    Excluded
      Obligations

     

    21.4           Notwithstanding
      anything to the contrary expressed or implied herein, neither the Agent nor
      the
      Arrangers shall:

     

    
      	
              (a)

            	
              be
                bound to enquire as to (i) whether or not any representation made
                or
                deemed to be made by an Obligor in connection with the Finance Documents
                is true, (ii) the occurrence of any Default, (iii) the performance
                by an
                Obligor of its obligations under the Finance Documents or (iv) any
                breach
                of or default by an Obligor of or under its obligations under the
                Finance
                Documents;

            

    

     

    
      	
              (b)

            	
              be
                bound to account to any Lender for any sum or the profit element
                of any
                sum received by it for its own
                account;

            

    

     

    
      	
              (c)

            	
              be
                bound to disclose to any other person any information relating to
                any
                Obligor or any Related Party if (i) such person, on providing such
                information, expressly stated to the Agent or, as the case may be,
                the
                Arrangers, that such information was confidential or (ii) such disclosure
                would or might in its opinion constitute a breach of any Law or be
                otherwise actionable at the suit of any
                person;

            

    

     

    
      	
              (d)

            	
              be
                under any obligations other than those for which express provision
                is made
                herein;

            

    

     

    
      	
              (e)

            	
              be
                or be deemed to be a fiduciary for any other party hereto;
                or

            

    

     

    
      
        
        

      

      
        -46-

        
          

        

      

      
        
        

      

    

    
      	
              (f)

            	
              be
                obliged to carry out any “know your customer” or other checks in relation
                to any person on behalf of any Lender and each Lender confirms to
                the
                Agent and the Arranger that it is solely responsible for any such
                checks
                it is required to carry out and that it may not rely on any statement
                in
                relation to such checks made by the Agent or the
                Arranger.

            

    

     

    Indemnification

     

    21.5           Each
      Lender shall, pro rata according to its Applicable Percentage (determined as
      of
      the time that the applicable cost, claim, loss, expense and/or liability is
      sought), from time to time on demand by the Agent, indemnify the Agent against
      any and all costs, claims, losses, expenses (including legal fees) and
      liabilities together with any value added tax thereon (or equivalent) which
      the
      Agent may incur, otherwise than by reason of its own gross negligence or wilful
      misconduct, in acting in its capacity as agent hereunder (unless the Agent
      has
      been reimbursed by an Obligor pursuant to a Finance Document).

     

    Exclusion
      of Liabilities

     

    21.6           Except
      in the case of gross negligence or wilful default, neither the Agent nor the
      Arrangers accept any responsibility:

     

    
      	
              (a)

            	
              for
                the adequacy, accuracy and/or completeness of any information supplied
                by
                the Agent or the Arrangers, by an Obligor or by any other person
                in
                connection with the Finance Documents or any other agreement, arrangement
                or document entered into, made or executed in anticipation of, pursuant
                to
                or in connection with the Finance
                Documents;

            

    

     

    
      	
              (b)

            	
              for
                the legality, validity, effectiveness, adequacy or enforceability
                of the
                Finance Documents or any other agreement, arrangement or document
                entered
                into, made or executed in anticipation of, pursuant to or in connection
                with the Finance Documents; or

            

    

     

    
      	
              (c)

            	
              for
                the exercise of, or the failure to exercise, any judgement, discretion
                or
                power given to any of them by or in connection with the Finance Documents
                or any other agreement, arrangement or document entered into, made
                or
                executed in anticipation of, pursuant to or in connection with the
                Finance
                Documents.

            

    

     

    Accordingly,
      neither the Agent nor the Arrangers shall be under any liability (whether in
      negligence or otherwise) in respect of such matters, save in the case of gross
      negligence or wilful misconduct.

     

    No
      Actions

     

    21.7           Each
      of the Lenders agree that it will not assert or seek to assert against any
      director, officer or employee of the Agent or the Arrangers any claim it might
      have against any of them in respect of the matters referred to in
      Clause 21.6 (Exclusion of Liabilities).

     

    Business
      with the Group

     

    21.8           The
      Agent and the Arrangers may accept deposits from, lend money to and generally
      engage in any kind of banking or other business with any of the Obligors or
      their Subsidiaries.

     

    Resignation

     

    21.9           The
      Agent may resign its appointment hereunder at any time without assigning any
      reason therefor by giving not less than thirty days’ prior notice to that effect
      to each of the other parties hereto, PROVIDED THAT no such
      resignation shall be effective until a successor for the Agent is appointed
      in
      accordance with the succeeding provisions of this Clause 21.

     

    
      Successor
        Agent

       

    

    

      21.10           If
        the Agent gives notice of its resignation pursuant to Clause 0
        (Resignation) then any reputable and experienced Lender or other
        financial institution may be appointed as a successor to the Agent by the
        Majority Lenders (with the approval of the Account Party, not to be unreasonably
        withheld or delayed,) during the period of such notice (with the co-operation
        of
        the Agent) but, if no such successor is so appointed, the Agent may appoint
        such
        a successor itself.

       

      
        
          
          

        

        
          -47-

          
            

          

        

        
          
          

        

      

     

    Rights
      and Obligations

     

    21.11           If
      a successor to the Agent is appointed under the provisions of Clause 21.10
      (Successor Agent), then (a) the retiring Agent shall be discharged
      from any further obligation hereunder but shall remain entitled to the benefit
      of the provisions of this Clause 21 and (b) its successor and each of
      the other parties hereto shall have the same rights and obligations amongst
      themselves as they would have had if such successor had been a party
      hereto.

     

    Own
      Responsibility

     

    21.12           It
      is understood and agreed by each Lender that at all times it has itself been,
      and will continue to be, solely responsible for making its own independent
      appraisal of and investigation into all risks arising under or in connection
      with this Agreement including, but not limited to:

     

    
      	
              (a)

            	
              the
                financial condition, creditworthiness, condition, affairs, status
                and
                nature of each member of the Group;

            

    

     

    
      	
              (b)

            	
              the
                legality, validity, effectiveness, adequacy and enforceability of
                the
                Finance Documents and any other agreement, arrangement or document
                entered
                into, made or executed in anticipation of, pursuant to or in connection
                with the Finance Documents;

            

    

     

    
      	
              (c)

            	
              whether
                such Lender has recourse, and the nature and extent of that recourse,
                against an Obligor or any other person or any of its assets under
                or in
                connection with the Finance Documents, the Transactions or any other
                agreement, arrangement or document entered into, made or executed
                in
                anticipation of, pursuant to or in connection with the Finance
                Documents; and

            

    

     

    
      	
              (d)

            	
              the
                adequacy, accuracy and/or completeness of any information provided
                by the
                Agent or the Arrangers, an Obligor or by any other person in connection
                with the Finance Documents, the Transactions or any other agreement,
                arrangement or document entered into, made or executed in anticipation
                of,
                pursuant to or in connection with the Finance
                Documents.

            

    

     

    Accordingly,
      each Lender acknowledges to the Agent and the Arrangers that it has not relied
      on and will not hereafter rely on the Agent and the Arrangers or any of them
      in
      respect of any of these matters.

     

    Agency
      Division Separate

     

    21.13           In
      acting as agent hereunder for the Lenders, the Agent shall be regarded as acting
      through its agency division which shall be treated as a separate entity from
      any
      other of its divisions or departments and, notwithstanding the foregoing
      provisions of this Clause 21, any information received by some other division
      or
      department of the Agent may be treated as confidential and shall not be regarded
      as having been given to the Agent’s agency division.

     

    Declaration
      of Agent as Security Trustee

     

    21.14    The
      Agent
      hereby declares that it shall hold:

     

    
      	
              (a)

            	
              all
                rights, titles and interests that may hereafter be mortgaged, charged,
                assigned or otherwise secured in favour of the Agent by or pursuant
                to the
                Finance Documents;

            

    

     

    
      	
              (b)

            	
              the
                benefit of all representations, covenants, guarantees, indemnities
                and
                other contractual provisions given in favour of the Agent (other
                than any
                such benefits given to the Agent solely for its own benefit) by or
                pursuant to the Finance Documents (other than this Agreement);
                and

            

    

     

    
      
        
        

      

      
        -48-

        
          

        

      

      
        
        

      

    

    
      	
              (c)

            	
              all
                proceeds of the security referred to in paragraph (a) above and of
                the enforcement of the benefits referred to in paragraph (b)
                above,

            

    

     

    on
      trust
      for itself and the other Finance Parties from time to time.

     

    Such
      declaration shall remain valid notwithstanding that the Agent may on the date
      hereof or at any other time be the sole Finance Party; for the avoidance of
      doubt, however, such declaration shall, in such case, be deemed repeated on
      each
      date on which the Agent ceases to be the sole Finance Party.

     

    Each
      of
      the parties hereto agrees that the obligations, rights and benefits vested
      or to
      be vested in the Agent as trustee as aforesaid by the Finance Documents or
      any
      document entered into pursuant thereto shall (as well before as after
      enforcement) be performed and (as the case may be) exercised by the Agent in
      accordance with the provisions of this Clause 21.

     

    Powers
      and Discretions

     

    21.15           The
      Agent shall have all the powers and discretions conferred upon trustees by
      the
      Trustee Act 1925 (to the extent not inconsistent herewith) and by way of
      supplement it is expressly declared as follows:

     

    
      	
              (a)

            	
              the
                Agent shall be at liberty to place any of the Finance Documents and
                any
                other instruments, documents or deeds delivered to it pursuant thereto
                or
                in connection therewith for the time being in its possession in any
                safe
                deposit, safe or receptacle selected by the Agent or with any Lender,
                any
                company whose business includes undertaking the safe custody of documents
                or any firm of lawyers of good
                repute;

            

    

     

    
      	
              (b)

            	
              the
                Agent may, whenever it thinks fit, delegate by power of attorney
                or
                otherwise to any person or persons or fluctuating body of persons
                all or
                any of the rights, trusts, powers, authorities and discretions vested
                in
                it by any of the Finance Documents and such delegation may be made
                upon
                such terms and subject to such conditions (including the power to
                sub-delegate) and subject to such regulations as the Agent may think
                fit
                and the Agent shall not be bound to supervise, or be in any way
                responsible for any loss incurred by reason of any misconduct or
                default
                on the part of, any such delegate (or
                sub-delegate);

            

    

     

    
      	
              (c)

            	
              notwithstanding
                anything else herein contained, the Agent may refrain from doing
                anything
                which would or might in its opinion be contrary to any Law of any
                jurisdiction or any directive or regulation of any agency of any
                state or
                which would or might otherwise render it liable to any person and
                may do
                anything which is, in its opinion, necessary to comply with any such
                Law,
                directive or regulation;

            

    

     

    
      	
              (d)

            	
              save
                in the case of gross negligence or wilful misconduct, the Agent and
                every
                attorney, agent, delegate, sub-delegate and any other person appointed
                by
                any of them under any of the Finance Documents may indemnify itself
                or
                himself out of the security held by the Agent against all liabilities,
                costs, fees, charges, losses and expenses incurred by any of them
                in
                relation to or arising out of the taking or holding of any of the
                security
                constituted by, or any of the benefits provided by, any of the Finance
                Documents, in the exercise or purported exercise of the rights, trusts,
                powers and discretions vested in any of them or in respect of any
                other
                matter or thing done or omitted to be done in any way relating to
                any of
                the Finance Documents or pursuant to any Law or regulation;
                and

            

    

     

    
      	
              (e)

            	
              without
                prejudice to the provisions of any of the Finance Documents, the
                Agent
                shall not be under any obligation to insure any property or to require
                any
                other person to maintain any such insurance and shall not be responsible
                for any loss which may be suffered by any person as a result of the
                lack
                of or inadequacy or insufficiency of any such
                insurance.

            

    

     

    Liability

     

    21.16           The
      Agent shall not be liable for any failure:

     

    
      
        
        

      

      
        -49-

        
          

        

      

      
        
        

      

    

    (a)           to
      require the deposit with it of any deed or document certifying, representing
      or
      constituting the title of the Account Party to any of the property mortgaged,
      charged, assigned or otherwise encumbered by or pursuant to any of the Finance
      Documents;

     

    
      	
              (b)

            	
              to
                obtain any licence, consent or other authority for the execution,
                delivery, validity, legality, adequacy, performance, enforceability
                or
                admissibility in evidence of any of the Finance
                Documents;

            

    

     

    
      	
              (c)

            	
              to
                register or notify any deed or document mentioned at paragraph (a)
                above in accordance with the provisions of any of the documents of
                title
                of the Account Party;

            

    

     

    
      	
              (d)

            	
              to
                effect or procure registration of or otherwise protect any of the
                security
                created by any of the Finance Documents by registering the same under
                any
                applicable registration Laws in any territory or otherwise by registering
                any notice, caution or other entry prescribed by or pursuant to the
                provisions of relevant Laws;

            

    

     

    
      	
              (e)

            	
              to
                take or to require the Account Party to take any steps to render
                the
                security created or purported to be created by or pursuant to any
                of the
                Finance Documents effective or to secure the creation of any ancillary
                charge under the Laws of any jurisdiction;
                or

            

    

     

    
      	
              (f)

            	
              to
                require any further assurances in relation to any of the Finance
                Documents.

            

    

     

    Title
      to Security etc.

     

    21.17           The
      Agent may accept without enquiry, requisition or objection such right and title
      as the Account Party may have to the property belonging (or purportedly
      belonging) to it (or any part thereof) which is the subject matter of any of
      the
      Finance Documents and shall not be bound or concerned to investigate or make
      any
      enquiry into the right or title of the Account Party to such property (or any
      part thereof) or, without prejudice to the foregoing, to require the Account
      Party to remedy any defect in the Account Party’s right or title as
      aforesaid.

     

    New
      Security Trustee

     

    21.18           The
      Agent may at any time appoint any person (whether or not a trust corporation)
      to
      act either as a separate trustee or as a co-trustee jointly with the
      Agent:

     

    
      	
              (a)

            	
              if
                the Agent considers such appointment to be in the interests of the
                Lenders; or

            

    

     

    
      	
              (b)

            	
              for
                the purposes of conforming to any legal requirements, restrictions
                or
                conditions which the Agent deems relevant for the purposes of the
                Finance
                Documents and the Agent shall give prior notice to the Account Party
                and
                the Lenders of any such
                appointment.

            

    

     

    Any
      person so appointed shall (subject to the provisions of the Finance Documents)
      have such powers, authorities and discretions and such duties and obligations
      as
      shall be conferred or imposed or such person by the instrument of appointment
      and shall have the same benefits under this Clause 21 as the
      Agent.

     

    The
      Agent
      shall have power in like manner to remove any person so appointed.

     

    Such
      reasonable remuneration as the Agent may pay to any person so appointed, and
      any
      costs, charges and expenses incurred by such person in performing its functions
      pursuant to such appointment, shall for the purposes hereof be treated as costs,
      charges and expenses incurred by the Agent under the Finance
      Documents.

     

    Perpetuity
      Period

     

    21.19           The
      perpetuity period under the rule against perpetuities if applicable to the
      trusts constituted in this Clause 21 and the other Finance Documents shall
      be the period of eighty years from the date of this Agreement and, subject
      thereto, if the Agent determines that all of the obligations of the Account
      Party under any of the Finance Documents have been fully and unconditionally
      discharged, such trusts shall be wound up.

     

    
      
        
        

      

      
        -50-

        
          

        

      

      
        
        

      

    

    Lender
      Representations

     

    21.20           Each
      Lender represents to the Agent on the date of issue of each Letter of Credit
      that:

     

    
      	
              (a)

            	
              the
                execution and delivery of each Letter of Credit by the Agent on the
                Lender’s behalf has been duly authorised by all necessary action on the
                part of the Lender; and

            

    

     

    
      	
              (b)

            	
              the
                obligations of the Lender under each Letter of Credit constitute
                its
                legal, valid and binding
                obligations.

            

    

     

    Letters
      of Credit

     

    21.21           Each
      Lender shall, (a) pro rata according to its respective Commitment, indemnify
      the
      Agent against any and all liabilities, costs and expenses which the Agent may
      incur otherwise than by reason of its own gross negligence or wilful misconduct
      (in its capacity as Agent) as a result of the execution and delivery of any
      Letter of Credit and any documents executed and delivered by the Agent in
      connection therewith; and (b) inform the Agent promptly if at any time the
      collateral securing the repayment of any amounts payable under any Letter of
      Credit comprises directly or indirectly a security interest over a principal
      private residence.

     

    22.           NOTICES

     

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

     

    
      	
              (a)

            	
              if
                to any Obligor, to:

            

    

     

    XL
      Capital Ltd

    XL
      House

    One
      Bermudiana Road

    Hamilton
      HM 11

    Bermuda

     

    Fax:                      1
      441 295 4867

    Attention:           Executive
      Vice President, General Counsel and Secretary

     

    
      	
              (b)

            	
              if
                to the Agent:

            

    

     

    Citigroup
      Centre

    33
      Canada
      Square

    London
      E14 5LB

     

    Fax:                      44
      20 8636 3824

    Attention:           Loans
      Agency

     

    
      	
              (c)

            	
              if
                to a Lender, to it at its address (or facsimile number) on the signature
                pages of this Agreement, or such other address as it shall notify
                to the
                Agents and the Account Party.

            

    

     

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

     

    
      
        
        

      

      
        -51-

        
          

        

      

      
        
        

      

    

    23.           WAIVERS
      AND AMENDMENTS

     

    No
      Deemed Waivers

     

    23.1           No
      failure or delay by any Finance Party in exercising any right or power hereunder
      shall operate as a waiver thereof, nor shall any single or partial exercise
      of
      any such right or power, or any abandonment or discontinuance of steps to
      enforce such a right or power, preclude any other or further exercise thereof
      or
      the exercise of any other right or power. No waiver of any provision of this
      Agreement or consent to any departure by an Obligor therefrom shall in any
      event
      be effective unless the same shall be permitted by Clause 23.3
      (Amendments), and then such waiver or consent shall be effective only
      in the specific instance and for the purpose for which given. Without limiting
      the generality of the foregoing, the issuance of a Letter of Credit shall not
      be
      construed as a waiver of any Default, regardless of whether the Agent or any
      Lender may have had notice or knowledge of such Default at the
      time.

     

    Remedies
      Cumulative

     

    23.2           The
      rights and remedies of the Finance Parties hereunder are cumulative and are
      not
      exclusive of any rights or remedies that they would otherwise have.

     

    Amendments

     

    23.3           Neither
      this Agreement nor any provision hereof may be waived, amended or modified
      except pursuant to an agreement or agreements in writing entered into by the
      Obligors and the Majority Lenders or by the Obligors and the Agent with the
      consent of the Majority Lenders; PROVIDED that no such
      agreement shall:

     

    
      	
              (a)

            	
              increase
                the Commitment of any Lender without the written consent of such
                Lender,

            

    

     

    
      	
              (b)

            	
              reduce
                the amount of any reimbursement obligation of the Account Party in
                respect
                of any LC Disbursement or reduce the rate of interest thereon, or
                reduce
                any fees payable hereunder, without the written consent of each Lender
                affected thereby,

            

    

     

    
      	
              (c)

            	
              postpone
                the scheduled date for reimbursement of any LC Disbursement, or any
                interest thereon, or any fees payable hereunder, or reduce the amount
                of,
                waive or excuse any such payment, or postpone the scheduled date
                of
                expiration of any Commitment or any Letter of Credit (other than
                an
                extension thereof pursuant to Clause 4), without the written consent
                of each Lender affected thereby,

            

    

     

    
      	
              (d)

            	
              change
                Clause 15.4 (Pro Rata Treatment) or 15.5 (Sharing of Payments
                By Lenders) without the consent of each Lender affected
                thereby,

            

    

     

    
      	
              (e)

            	
              release
                any of the Guarantors from any of their guarantee obligations under
                Clause 16 (Guarantee and Indemnity) without the written
                consent of each Lender,

            

    

     

    
      	
              (f)

            	
              release
                any security granted by the Account Party pursuant to Clause 19.8
                (Ratings Downgrade) or 20 (Events of Default) without
                the written consent of each Lender,
                and

            

    

     

    
      	
              (g)

            	
              change
                any of the provisions of this Clause or the percentage in the definition
                of the term Majority Lenders or any other
                provision hereof specifying the number or percentage of Lenders required
                to waive, amend or modify any rights hereunder or make any determination
                or grant any consent hereunder, without the written consent of each
                Lender;

            

    

     

    and
      PROVIDED FURTHER that no such agreement shall amend, modify or
      otherwise affect the rights or duties of the Agent hereunder without the prior
      written consent of the Agent.

     

    24.           COSTS
      AND EXPENSES

     

    24.1           The
      Account Party shall pay:

     

    
      	
              (a)

            	
              all
                reasonable out-of-pocket expenses and charges incurred by the Agent
                and/or
                the Arrangers (together with VAT or any similar tax thereon and including
                the reasonable fees, charges and disbursements of
                cou

            

    

     

    
      
        
        

      

      
        -52-

        
          

        

      

      
        
        

      

    

    
      	
               

            	
              sel
                for the Agent) in connection with the syndication of the credit facilities
                provided for herein, the negotiation, preparation, execution and
                administration of the Finance Documents (subject to the terms of
                the
                Commitment Letter) or any amendments, modifications or waivers of
                the
                provisions hereof (whether or not the transactions contemplated hereby
                or
                thereby shall be consummated);

            

    

     

    
      	
              (b)

            	
              all
                reasonable out-of-pocket expenses incurred by the Agent, the Security
                Trustee or any Lender, (together with VAT or any similar tax thereon
                and
                including the reasonable fees, charges and disbursements of one legal
                counsel for the Agent and one legal counsel for the Lenders), in
                connection with the preservation and/or enforcement or protection
                of its
                rights in connection with the Finance Documents, including its rights
                under this Clause, or in connection with Letters of Credit issued
                hereunder, including in connection with any workout, restructuring
                or
                negotiations in respect thereof.

            

    

     

    Stamp
      Duty

     

    24.2           The
      Account Party shall pay all transfer, stamp, documentary or other similar taxes,
      assessments or charges levied by any governmental or revenue authority in
      respect of this Agreement or any other document referred to herein.

     

    25.           INDEMNITIES

     

    Currency
      Indemnity

     

    
      	
              25.1
                (a)

            	
              If:

            

    

     

    
      	
               

            	
              (i)

            	
              any
                amount payable by the Account Party under or in connection with this
                Agreement is received by any Finance Party in a currency (the
                Payment Currency) other than that agreed in this
                Agreement (the Agreed Currency) whether as a
                result of any judgement or order or the enforcement thereof, the
                liquidation of the payer or otherwise;
                and

            

    

     

    
      	
               

            	
              (ii)

            	
              the
                amount produced by converting the Payment Currency so received into
                the
                Agreed Currency is less than the relevant amount of the Agreed
                Currency.

            

    

     

    then
      the
      Account Party shall, as an independent obligation, indemnify such Finance Party
      for the deficiency and any loss sustained as a result.  Such
      conversion shall be made at such prevailing rate of exchange, on such date
      and
      in such market as is determined by such Finance Party (acting reasonably) as
      being most appropriate for the conversion.  The Account Party shall in
      addition pay the costs of the conversion.

     

    
      	
              (b)

            	
              The
                Account Party waives any right it may have in any jurisdiction to
                pay any
                amount under this Agreement in a currency other than that in which
                it is
                expressed to be payable in this
                Agreement.

            

    

     

    Other
      Indemnities

     

    25.2           The
      Obligors shall indemnify the Agent and each Lender, and each Related Party
      of
      any of the foregoing Persons (each such Person being called an
Indemnitee) against, and to hold each Indemnitee
      harmless from, any and all losses, claims, damages, liabilities and related
      expenses, including the fees, charges and disbursements of any counsel for
      any
      Indemnitee, incurred by or asserted against any Indemnitee arising out of,
      in
      connection with, or as a result of:

     

    
      	
              (a)

            	
              the
                execution or delivery of this Agreement or any agreement or instrument
                contemplated hereby, the performance by the parties hereto of their
                respective obligations hereunder or the consummation of the Transactions
                or any other transactions contemplated
                hereby;

            

    

     

    
      	
              (b)

            	
              any
                Letter of Credit or the use of any thereof (including any refusal
                by any
                Lender to honour a demand for payment under a Letter of Credit if
                the
                documents presented in connection with such demand do not strictly
                comply
                with the terms of such Letter of
                Credit);

            

    

     

    
      
        
        

      

      
        -53-

        
          

        

      

      
        
        

      

    

    
      	
              (c)

            	
              any
                actual or prospective claim, litigation, investigation or proceeding
                relating to any of the foregoing, whether based on contract, tort
                or any
                other theory and regardless of whether any Indemnitee is a party
                thereto;
                provided that such indemnity shall not, as to any Indemnitee, be
                available
                to the extent that such losses, claims, damages, liabilities or related
                expenses result from or arise out of the gross negligence or wilful
                misconduct of such Indemnitee.

            

    

     

    Reimbursement
      by Lenders

     

    25.3           To
      the extent that the Obligors fail to pay any amount required to be paid by
      them
      to the Agent under Clauses 24.1 (Costs and Expenses) or 25.1
      (Currency Indemnity) and 25.2 (Other Indemnities), each Lender
      severally agrees to pay to the Agent such Lender’s Applicable Percentage
      (determined as of the time that the applicable unreimbursed expense or indemnity
      payment is sought) of such unpaid amount; PROVIDED that the
      unreimbursed expense or indemnified loss, claim, damage, liability or related
      expense, as the case may be, was incurred by or asserted against the Agent
      in
      its capacity as such.

     

    26.           ALTERATION
      TO THE PARTIES

     

    Successors

     

    26.1           The
      provisions of this Agreement shall be binding upon and inure to the benefit
      of
      the parties hereto and their respective successors and assigns permitted
      hereby.

     

    Assignments
      and Transfers by the Account Party

     

    26.2    The
      Account
      Party shall not assign or otherwise transfer any of its rights or obligations
      hereunder without the prior written consent of each Lender (and any attempted
      assignment or transfer by the Account Party without such consent shall be null
      and void).

     

    Transfers
      by Lenders.

     

    
      	
              26.3
                (a)

            	
              Any
                Lender (the Transferor) may at any time transfer
                to another Approved Credit Institution (the
                Transferee) all or a portion of its rights and
                obligations under this Agreement (including all or a portion of its
                Commitment) and under any Letter of Credit to which it is a party;
                PROVIDED THAT:

            

    

     

    
      	
               

            	
              (i)

            	
              except
                in the case of an transfer to a Lender or a Lender Affiliate, each
                of the
                Account Party and the Agent must give their prior written consent
                to such
                assignment (which consent shall not be unreasonably withheld or
                delayed);

            

    

     

    
      	
               

            	
              (ii)

            	
              except
                in the case of an transfer to a Lender or a Lender Affiliate or a
                transfer
                of the entire remaining amount of the Transferor’s Commitment, the amount
                of the Commitment of the Transferor subject to each such transfer
                (determined as of the date of the Transfer Certificate) shall not
                be less
                than £3,000,000 unless each of the Account Party and the Agent otherwise
                consent;

            

    

     

    
      	
               

            	
              (iii)

            	
              a
                transfer of obligations shall only be effective if the
                Transferee:

            

    

     

    
      	
               

            	
              (A)

            	
              if
                it shall not be a Lender, has delivered relevant contact, notice
                and
                account details to the Agent (with a copy to the Account Party) as
                well as
                any information required by the Agent to perform “know your customer” or
                other checks relating to any person that it is required to carry
                out in
                relation to the Transferee, the completion of which the Agent shall
                promptly notify to the Transferor and the Transferee;
                and

            

    

     

    
      	
               

            	
              (B)

            	
              has
                confirmed to the Agent and the Account Party prior to the transfer
                taking
                effect that it undertakes to be bound by the terms of this Agreement
                as
                Lender in form and substance reasonably satisfactory to the Agent
                and the
                Account Party; and on any such transfer
                being

            

    

     

    
      
        
        

      

      
        -54-

        
          

        

      

      
        
        

      

    

    
      	
               

            	
              made
                the Transferor shall be relieved of its obligations to the extent
                they are
                transferred to the Transferee.

            

    

     

    PROVIDED
      FURTHER that any consent of the Account Party otherwise required under
      this paragraph shall not be required if an Event of Default under
      Clause 20(a), (e) or (f) has occurred and is continuing.  Upon
      transfer pursuant to Clause 26.4, from and after the last to occur of
      (i) the effective date specified in each Transfer Certificate; and
      (ii) the cancellation of a Letter of Credit and the issue of a new Letter
      of Credit with the Transferee identified as an Issuing Lender (the
Issuing Lender Transfer), the Transferee thereunder
      shall be a party hereto and, to the extent of the lesser of the interest
      assigned by such Transfer Certificate and the Transferee’s participation as an
      Issuing Lender of a re-issued Letter of Credit (the Transferred
      Interest), have the rights and obligations of a Lender under this
      Agreement, and the Transferor thereunder shall, to the extent of the Transferred
      Interest, be released from its obligations under this Agreement (and, in the
      case of Transfer Certificate covering all of the Transferor’s rights and
      obligations under this Agreement, such Lender shall cease to be a party hereto
      but shall continue to be entitled to the benefits of Clauses 12 (Increased
      Costs), 10 (Taxes) 24 (Costs and Expenses) and 25
      (Indemnities)). Any assignment or transfer by a Lender of rights or
      obligations under this Agreement that does not comply with this paragraph shall
      be treated for purposes of this Agreement as a sale by such Lender of a
      participation in such rights and obligations in accordance with Clause 26.7
      (Participations).

     

    Notwithstanding
      anything to the contrary contained herein, any Lender (a Granting
      Lender) may grant to a special purpose vehicle (an
SPV) of such Granting Lender, identified
      as such in
      writing from time to time by the Granting Lender to the Agent and the Account
      Party, the option to provide to the Account Party all or any part of any LC
      Disbursement that such Granting Lender would otherwise be obligated to make
      to
      the Account Party pursuant to Clause 2.1, PROVIDED that (i)
      nothing herein shall constitute a commitment by any SPV to make any LC
      Disbursement, (ii) if an SPV elects not to exercise such option or otherwise
      fails to provide all or any part of such LC Disbursement, the Granting Lender
      shall be obligated to make such LC Disbursement pursuant to the terms hereof
      and
      (iii) the Account Party may bring any proceeding against either or both the
      Granting Lender or the SPV in order to enforce any rights of the Account Party
      hereunder; and (iv) the SPV shall agree to the terms of Clause 30.2
      (Confidentiality). The making of an LC Disbursement by an SPV hereunder
      shall utilise the Commitment of the Granting Lender to the same extent, and
      as
      if, such LC Disbursement were made by the Granting Lender. Each party hereto
      hereby agrees that no SPV shall be liable for any payment under this Agreement
      for which a Lender would otherwise be liable, for so long as, and to the extent,
      the related Granting Lender makes such payment. In furtherance of the foregoing,
      each party hereto hereby agrees (which agreement shall survive the termination
      of this Agreement) that, prior to the date that is one year and one day after
      the payment in full of all outstanding commercial paper or other senior
      indebtedness of any SPV, it will not institute against, or join any other person
      in instituting against, such SPV any bankruptcy, reorganisation, arrangement,
      insolvency or liquidation proceedings or similar proceedings under the Laws
      of
      the United States or any State thereof arising out of any claim against such
      SPV
      under this Agreement. In addition, notwithstanding anything to the contrary
      contained in this Clause, any SPV may with notice to, but without the prior
      written consent of, the Account Party or the Agent and without paying any
      processing fee therefor, assign all or a portion of its interests in any Letter
      of Credit to its Granting Lender or to any financial institutions (consented
      to
      by the Account Party and the Agent) providing liquidity and/or credit support
      (if any) with respect to commercial paper issued by such SPV to issue such
      Letters of Credit and such SPV may disclose, on a confidential basis,
      confidential information with respect to any Account Party and its Subsidiaries
      to any rating agency, commercial paper dealer or provider of a surety, guarantee
      or credit liquidity enhancement to such SPV. This paragraph may not be amended
      without the consent of any SPV at the time holding LC Disbursements under this
      Agreement.

     

    
      	
              (b)

            	
              On
                each occasion a Transferor assigns, transfers or novates any of its
                rights
                and/or obligations under this Agreement, the Transferee (unless it
                is
                already a Lender or a Lender Affiliate immediately prior to the transfer)
                shall ensure that the Agent has notice of the same and shall, on
                the date
                the assignment, transfer and/or novation takes effect, pay to the
                Agent
                for its own account a fee of
£1,000.

            

    

     

    
      	
              (c)

            	
              Neither
                a Transferor nor any other Finance Party is responsible to a Transferee
                for:

            

    

     

    
      
        
        

      

      
        -55-

        
          

        

      

      
        
        

      

    

    
      	
            	
              (i)

            	
              the
                execution, genuineness, validity, enforceability or sufficiency of
                any
                Finance Documents or any other
                document;

            

    

     

    
      	
               

            	
              (ii)

            	
              the
                collectability of amounts payable under any Finance Documents or
                the
                financial condition of or the performance of its obligations under
                the
                Finance Documents by any Obligor;
                or

            

    

     

    
      	
               

            	
              (iii)

            	
              the
                accuracy of any statements or information (whether written or oral)
                made
                in or in connection with or supplied in connection with any Finance
                Documents.

            

    

     

    
      	
              (d)

            	
              Each
                Transferee confirms to the Transferor and the other Finance Parties
                that
                it:

            

    

     

    
      	
               

            	
              (i)

            	
              has
                made its own independent investigation and assessment of the financial
                condition and affairs of each Obligor and its related entities in
                connection with its participation in this Agreement and has not relied
                exclusively on any information provided to it by the Transferor or
                any
                other Finance Party in connection with any Finance Documents;
                and

            

    

     

    
      	
               

            	
              (ii)

            	
              will
                continue to make its own independent appraisal of the creditworthiness
                of
                each Obligor and its related entities for so long as there are any
                Commitments or LC Exposures under this
                Agreement.

            

    

     

    
      	
              (e)

            	
              Nothing
                in any Finance Document obliges a Transferor
                to:

            

    

     

    
      	
               

            	
              (i)

            	
              accept
                a re-transfer from a Transferee of any of the rights and/or obligations
                assigned, transferred or novated under this Clause;
                or

            

    

     

    
      	
               

            	
              (ii)

            	
              support
                any losses incurred by the Transferee by reason of the non-performance
                by
                any Obligor of its obligations under any Finance Document or
                otherwise.

            

    

     

    26.4           Transfer
      Procedure:

     

    
      	
              (a)

            	
              A
                novation is effected if:

            

    

     

    
      	
               

            	
              (i)

            	
              the
                Transferor and the Transferee deliver to the Agent a duly completed
                Transfer Certificate executed by the Transferor and the Transferee;
                and

            

    

     

    
      	
               

            	
              (ii)

            	
              the
                Agent executes it

            

    

     

    PROVIDED
      THAT the Agent shall only be obliged to execute a Transfer Certificate
      delivered to it by the Transferor and the Transferee once it is satisfied it
      has
      complied with all necessary “know your customer” or similar other checks under
      all applicable laws and regulations in relation to the transfer to such
      Transferee.

     

    
      	
              (b)

            	
              Each
                Party (other than the Transferor and the Transferee) irrevocably
                authorises the Agent to execute any duly completed Transfer Certificate
                on
                its behalf.

            

    

     

    
      	
              (c)

            	
              To
                the extent that they are expressed to be the subject of the novation
                in
                the Transfer Certificate:

            

    

     

    
      	
               

            	
              (i)

            	
              the
                Transferor and the other Parties (the existing
                Parties) will be released from their obligations to each
                other under the Finance Documents (the discharged
                obligations);

            

    

     

    
      	
               

            	
              (ii)

            	
              the
                Transferee and the existing Parties will assume obligations towards
                each
                other under the Finance Documents which differ from the discharged
                obligations only insofar as they are owed to or assumed by the Transferee
                instead of the Transferor;

            

    

     

    
      
        
        

      

      
        -56-

        
          

        

      

      
        
        

      

    

    
      	
               

            	
              (iii)

            	
              the
                rights of the Transferor against the existing Parties under the Finance
                Documents and vice versa (the discharged rights)
                will be cancelled; and

            

    

     

    
      	
               

            	
              (iv)

            	
              the
                Transferee and the existing Parties will acquire rights against each
                other
                under the Finance Documents which differ from the discharged rights
                only
                insofar as they are exercisable by or against the Transferee instead
                of
                the Transferor,

            

    

     

    
      	
               

            	
              all
                on the date specified in the proviso to
                Clause 26.3(a).

            

    

     

    Right
      to substitute single Lender

     

    26.5           If:

     

    
      	
              (a)

            	
              any
                sum payable to any Finance Party by the Account Party is required
                to be
                increased under Clause 10 (Taxes);
                or

            

    

     

    
      	
              (b)

            	
              any
                Lender claims indemnification from the Account Party under
                Clause 12.1 (Increased Costs);
                or

            

    

     

    
      	
               

            	
              a
                Lender’s Available Commitment has been reduced to zero pursuant to
                Clause 13(b)
                (Illegality),

            

    

     

    the
      Account Party may give the Agent notice of its intention to arrange the
      substitution of that Lender with a new bank or financial
      institution.

     

    On
      receipt of a notice from the Account Party referred to above, the Lender shall
      use its best endeavours to promptly assign or transfer all of its rights and
      obligations under this Agreement to an Approved Credit Institution nominated
      by
      the Account Party.  Such transfer will be effected in accordance with
      Clause 0 (Transfer Procedure) and the consideration for such
      transfer shall be an amount equal to the sum of all amounts accrued and owing
      by
      the Account Party to the transferring Lender as calculated on the date of
      transfer.

     

    Reference
      Banks

     

    26.6           If
      a Reference Bank ceases to be one of the Lenders, the Agent shall (in
      consultation with the Account Party) appoint another Lender or an affiliate
      of a
      Lender to replace that Reference Bank.

     

    Participations

     

    26.7           Any
      Lender may sell participations to one or more Lenders or other entities (a
      Participant) in all or a portion of such Lender’s rights and
      obligations under this Agreement and the other Credit Documents (including
      all
      or a portion of its Commitment); PROVIDED that:

     

    
      	
              (a)

            	
              any
                such participation sold to a Participant which is not a Lender or
                a Lender
                Affiliate shall be made only with the consent (which in each case
                shall
                not be unreasonably withheld) of the Account Party and the Agent,
                unless
                an Event of Default under Clause 20(a), (e) or (f) has occurred and
                is continuing, in which case the consent of the Account Party shall
                not be
                required;

            

    

     

    
      	
              (b)

            	
              such
                Lender’s obligations under this Agreement and the other Finance Documents
                shall remain unchanged;

            

    

     

    
      	
              (c)

            	
              such
                Lender shall remain solely responsible to the other parties hereto
                for the
                performance of such obligations;

            

    

     

    
      	
              (d)

            	
              the
                Account Party, the Agent, the Security Trustee and the other Lenders
                shall
                continue to deal solely and directly with such Lender in connection
                with
                such Lender’s rights and obligations under this Agreement and the other
                Finance Documents; and

            

    

     

    
      	
              (e)

            	
              the
                Participant shall agree to the terms of Clause 30.2
                (Confidentiality).

            

    

     

    
      
        
        

      

      
        -57-

        
          

        

      

      
        
        

      

    

    
      	
               

            	
              Any
                agreement or instrument pursuant to which a Lender sells such a
                participation shall provide that such Lender shall retain the sole
                right
                to enforce this Agreement and the other Finance Documents and to
                approve
                any amendment, modification or waiver of any provision of this Agreement
                or the other Finance Documents; PROVIDED that such
                agreement or instrument may provide that such Lender will not, without
                the
                consent of the Participant, agree to any amendment, modification
                or waiver
                described in the first proviso to Clause 23.3 (Amendments)
                that affects such Participant. Subject to Clause 26.8 (No
                Increased Costs),  the Obligors agree that each Participant
                shall be entitled to the benefits of Clauses 12 (Increased
                Costs) and 10 (Taxes) to the same extent as if
                it were a Lender and had acquired its interest by assignment pursuant
                to
                Clause 26.3 (Transfers by
                Lenders).

            

    

     

    No
      Increased Costs

     

    26.8           No
      Participant or Transferee shall be entitled to receive any greater payment
      under
      Clause 12 (Increased Costs) and 10 (Taxes) than the applicable
      Lender would have been entitled to receive with respect to the participation
      sold to such Participant or the Lender interest transferred.

     

    Certain
      Pledges

     

    26.9           Any
      Lender may at any time pledge or assign a security interest in all or any
      portion of its rights under this Agreement to secure obligations of such Lender,
      and this Clause shall not apply to any such pledge or assignment of a security
      interest; PROVIDED that no such pledge or assignment of a
      security interest shall release a Lender from any of its obligations hereunder
      or substitute any such assignee for such Lender as a party hereto.

     

    No
      Transfers to any Account Party or Affiliates

     

    26.9           Anything
      in this Clause 26 to the contrary notwithstanding, no Lender may assign or
      participate any interest in any LC Exposure held by it hereunder to any Obligor
      or any of its Affiliates or Subsidiaries without the prior consent of each
      Lender.

     

    Maintenance
      of Register by the Agent

     

    26.10           The
      Agent, acting for this purpose as an agent of the Account Party, shall maintain
      at one of its offices in London a copy of each Transfer Certificate delivered
      to
      it and a register of the names and addresses of the Lenders, and the Commitment
      of, and principal amount of the LC Disbursements owing to, each Lender pursuant
      to the terms hereof from time to time (the Register).
      The entries in the Register shall be conclusive, and the Account Party, the
      Agent, the Security Trustee and the Lenders may treat each Person whose name
      is
      recorded in the Register pursuant to the terms hereof as a Lender hereunder
      for
      all purposes of this Agreement, notwithstanding notice to the contrary. The
      Register shall be available for inspection by any Account Party and any Lender,
      at any reasonable time and from time to time upon reasonable prior
      notice.

     

    27.           SET
      OFF

     

    Right
      of Set-off

     

    If
      an
      Event of Default shall have occurred and be continuing, each Finance Party
      is
      hereby authorised at any time and from time to time, to the fullest extent
      permitted by Law, to set off and apply any and all deposits in any currency
      (general or special, time or demand, provisional or final) at any time held
      and
      other indebtedness in any currency at any time owing by such Finance Party
      to or
      for the credit or the account of any Obligor against any of and all the
      obligations of such Obligor now or hereafter existing under this Agreement
      held
      by such Finance Party, irrespective of whether or not such Finance Party shall
      have made any demand under this Agreement and although such obligations may
      be
      unmatured.  The rights of each Finance Party under this Clause are in
      addition to other rights and remedies (including other rights of set-off) which
      such Finance Party may have.  The relevant Finance Party may effect
      any appropriate currency exchanges to implement such set-off.

     

    
      
        
        

      

      
        -58-

        
          

        

      

      
        
        

      

    

    28.           MISCELLANEOUS
      PROVISIONS

     

    Certificates

     

    28.1           Any
      determination or notification by the Agent or any other Finance Party concerning
      any rate or amount under the Finance Documents shall, in the absence of manifest
      error, be conclusive evidence as to that matter.

     

    Survival

     

    28.2           All
      covenants, agreements, representations and warranties made by the Account Party
      herein and in the certificates or other instruments delivered in connection
      with
      or pursuant to this Agreement shall be considered to have been relied upon
      by
      the other parties hereto and shall survive the execution and delivery of this
      Agreement and the issuance of any Letters of Credit, regardless of any
      investigation made by any such other party or on its behalf and notwithstanding
      that the Agent or any Lender may have had notice or knowledge of any Default
      or
      incorrect representation or warranty at the time any credit is extended
      hereunder, and shall continue in full force and effect as long as any fee or
      any
      other amount payable under this Agreement is outstanding and unpaid or any
      Letter of Credit is outstanding and so long as the Commitments have not expired
      or terminated.  The provisions of Clauses 12 (Increased
      Costs), 10 (Taxes), 24 (Costs and Expenses), 25
      (Indemnities) and 21 (Agent) shall survive and remain in full
      force and effect regardless of the consummation of the transactions contemplated
      hereby, the expiration or termination of the Letters of Credit and the
      Commitments or the termination of this Agreement or any provision
      hereof.

     

    Counterparts

     

    28.3           This
      Agreement may be executed in counterparts (and by different parties hereto
      on
      separate counterparts), each of which shall constitute an original, but all
      of
      which when taken together shall constitute one and the same
      instrument.

     

    Entire
      Agreement

     

    28.4           This
      Agreement and the other Finance Documents constitute the entire contract between
      the parties relating to the subject matter hereof and supersede any and all
      previous agreements and understandings, oral or written, relating to the subject
      matter hereof.

     

    Severability

     

    28.5           Any
      provision of this Agreement or any other Finance Document held to be invalid,
      illegal or unenforceable in any jurisdiction shall, as to such jurisdiction,
      be
      ineffective to the extent of such invalidity, illegality or unenforceability
      without affecting the validity, legality and enforceability of the remaining
      provisions hereof.  The invalidity of a particular provision in a
      particular jurisdiction shall not invalidate such provision in any other
      jurisdiction.  To the extent permitted by applicable Law, each Obligor
      hereby waives any provision of Law which renders any provision of the Finance
      Documents prohibited or unenforceable in any respect.

     

    USA
      Patriot Act Notification

     

    28.6           Each
      Lender hereby notifies each Obligor that pursuant to the requirements of the
      USA
      Patriot Act (Title III of Pub. L. 107-56 (signed into law on October 26, 2001))
      (the Act) it is required to obtain, verify and record
      information that identifies each Obligor which information includes the name
      and
      address of such Obligor and other information that will allow such Lender to
      identify the Obligor in accordance with the Act.  Each Obligor agrees
      to promptly upon the request of such Lender supply, or procure the supply of,
      such information as is reasonably requested by such Lender in order for such
      Lender to be satisfied that it has complied with the Act.

     

    29.           GOVERNING
      LAW AND JURISDICTION

     

    Governing
      Law

     

    29.1           This
      Agreement shall be construed in accordance with and governed by English
      law.

     

    
      
        
        

      

      
        -59-

        
          

        

      

      
        
        

      

    

    Jurisdiction

     

    
      	
              29.2
                (a)

            	
              All
                the Parties agree that the courts of England are, subject to
                Clause 29.2(b) and (c) below, to have jurisdiction to settle any
                disputes which may arise in connection with the creation, validity,
                effect, interpretation or performance of, or the legal relationships
                established by, this Agreement (including, without limitation, claims
                for
                set-off or counterclaim) or otherwise arising in connection with
                this
                Agreement and for such purposes irrevocably submit to the jurisdiction
                of
                the English courts;

            

    

     

    
      	
              (b)

            	
              notwithstanding
                the agreement in paragraph (a) above, each of the Finance Parties
                shall
                retain the right to bring proceedings in any other court which has
                jurisdiction whether by virtue of the Convention on Jurisdiction
                and the
                Enforcement of Judgments signed on 27 September 1968 (as from time to
                time amended and extended) or by virtue of the Convention on Jurisdiction
                and the Enforcement of Judgments signed on 16 September 1988 (from
                time to time amended and extended) or Council Regulations (EC) No
                44/2001
                of 22 December 2000 on jurisdiction and the enforcement of judgements
                in
                civil and commercial matters which came into force on 1 March
                2002;

            

    

     

    
      	
              (c)

            	
              with
                respect to the courts agreed in paragraphs (a) and (b) above, each
                of the
                Parties irrevocably waives any objections on the ground of venue
                or forum
                non conveniens or any similar
                ground;

            

    

     

    
      	
              (d)

            	
              each
                of the Parties irrevocably agrees that a judgment or order of any
                court
                referred to in this Clause in connection with this Agreement is conclusive
                and binding on it and may be enforced against it in the courts of
                any
                other jurisdiction; and

            

    

     

    
      	
              (e)

            	
              each
                of the Parties irrevocably consents to service of process by mail
                or in
                any other manner permitted by the relevant
                Law.

            

    

     

    Agent
      for Service of Process

     

    29.3           Each
      Obligor shall at all times maintain an agent for service of process and any
      other documents in proceedings in England or any other proceedings in connection
      with this Agreement (a Process Agent).  The
      Process Agent shall be XL Services UK Limited, XL House, 70 Gracechurch Street,
      London EC3V 0XL (Attn: Company Secretary) and any writ, judgment or other notice
      of legal process shall be sufficiently served on the relevant Obligor if
      delivered to the Process Agent marked for the attention of the Company Secretary
      at its address for the time being.  Each Obligor undertakes not to
      revoke the authority of the Process Agent without promptly appointing a
      successor and notifying the Agent thereof.

     

    Waiver
      of Immunities

     

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

     

    30.           TREATMENT
      OF CERTAIN INFORMATION; CONFIDENTIALITY

     

    Treatment
      of Certain Information

     

    30.1           Each
      of the Obligors acknowledges that from time to time financial advisory,
      investment banking and other services may be offered or provided to any Obligor
      or one or more of their Subsidiaries (in connection with this Agreement or
      otherwise) by any Lender or by one or more subsidiaries or affiliates of such
      Lender and each of the Obligors hereby authorises each Lender to share any
      information delivered to such Lender by such Obligor and its Subsidiaries
      pursuant to this Agreement, or in connection with the decision of such Lender
      to
      enter into this Agreement, to any such subsidiary or affiliate, it being
      understood that (a) any such information shall be used only for the purpose
      of
      advising the Obligor or preparing presentation materials for the benefit of
      the
      Obligor and (b) any such

     

    
      
        
        

      

      
        -60-

        
          

        

      

      
        
        

      

    

    subsidiary
      or affiliate receiving such information shall be bound by Clause 30.2
      (Confidentiality) as if it were a Lender hereunder. Such authorisation
      shall survive the expiration or termination of the Letters of Credit and the
      Commitments or the termination of this Agreement or any provision
      hereof.

     

    Confidentiality

     

    30.2           Each
      of the Finance Parties agrees to maintain the confidentiality of the Information
      (as defined below), except that Information may be disclosed:

     

    
      	
              (a)

            	
              to
                its and its Affiliates’ directors, officers, employees and agents,
                including accountants, legal counsel and other advisors (it being
                understood that the Persons to whom such disclosure is made will
                be
                informed of the confidential nature of such Information and instructed
                to
                keep such Information
                confidential);

            

    

     

    
      	
              (b)

            	
              to
                the extent requested by any regulatory authority having jurisdiction
                over
                the Agent or any Lender;

            

    

     

    
      	
              (c)

            	
              to
                the extent required by applicable Laws or regulations or by any subpoena
                or similar legal process;

            

    

     

    
      	
              (d)

            	
              to
                any other Party;

            

    

     

    
      	
              (e)

            	
              in
                connection with the exercise of any remedies hereunder or any suit,
                action
                or proceeding relating to this Agreement or the enforcement of rights
                hereunder;

            

    

     

    
      	
              (f)

            	
              subject
                to an agreement in writing containing provisions substantially the
                same as
                those of this paragraph and for the benefit of the Obligor, to
                (i) any assignee or transferee of or Participant in, or any
                prospective assignee of or Participant in, any of its rights or
                obligations under this Agreement or (ii) any actual or prospective
                counterparty (or its advisors) to any swap or derivative transaction
                relating to any Obligor and its
                obligations;

            

    

     

    
      	
              (g)

            	
              with
                the consent of the Obligor; or

            

    

     

    
      	
              (h)

            	
              to
                the extent such Information (i) becomes publicly available other than
                as a result of a breach of this Clause 30.2 or (ii) becomes available
                to the Agent or any Lender on a non-confidential basis from a source
                other
                than an Obligor.

            

    

     

    For
      the
      purposes of this Clause, Information means all
      information received from an Obligor relating to an Obligor or its business,
      other than any such information that is available to the Finance Parties on
      a
      non-confidential basis prior to disclosure by such Obligor;
PROVIDED that, in the case of information received from an
      Obligor after the date hereof, such information is clearly identified at the
      time of delivery as confidential. Any Person required to maintain the
      confidentiality of Information as provided in this Clause shall be considered
      to
      have complied with its obligation to do so if such Person has exercised the
      same
      degree of care to maintain the confidentiality of such Information as such
      Person would accord to its own confidential information. Notwithstanding the
      foregoing, each of the Finance Parties agree that they will not trade the
      securities of any of the Obligors based upon non-public Information that is
      received by them.

     

    Notwithstanding
      anything in this Agreement to the contrary, the Agent, the Lenders and the
      Account Party (and each of their respective employees, representatives or other
      agents) may disclose to any and all persons, without limitation of any kind,
      the
      U.S. tax treatment and U.S. tax structure of the transactions contemplated
      by
      this Agreement and all materials of any kind (including opinions or other tax
      analyses) that are provided to such person relating to such tax treatment or
      tax
      structure, other than any information for which nondisclosure is reasonably
      necessary in order to comply with applicable securities laws, and except that,
      with respect to any document or similar item that in either case contains
      information concerning the U.S. tax treatment or U.S. tax structure of such
      transactions as well as other information, this paragraph shall only apply
      to
      such portions of the document or similar item that relate to such tax treatment
      or tax structure

     

    
      
        
        

      

      
        -61-

        
          

        

      

      
        
        

      

    

    31.           THIRD
      PARTY RIGHTS

     

    A
      person
      who is not a Party shall have no rights under the Contracts (Rights of Third
      Parties) Act 1999 to enforce any of its terms.

     

    32.           WAIVER
      OF TRIAL BY JURY

     

    EACH
      PARTY WAIVES ANY RIGHT IT MAY HAVE TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF
      ACTION BASED ON OR ARISING FROM ANY FINANCE DOCUMENT OR ANY TRANSACTION
      CONTEMPLATED BY ANY FINANCE DOCUMENT.

     

    In
      witness whereof the parties hereto have caused this Agreement to be
      duly executed on the date first written above.

     

    
      
        
        

      

      
        -62-

        
          

        

      

      
        
        

      

    

    SCHEDULE
      1

     

    COMMITMENTS

     

    
      	
              Name
                of Lender

               

            	
              Commitment
                (£)

               

            
	
              Citibank,
                N.A.

            	
              65,000,000

               

            
	
              Lloyds
                TSB Bank PLC

            	
              65,000,000

               

            
	
              The
                Royal Bank of Scotland PLC

            	
              65,000,000

               

            
	
              ING
                Bank N.V.

            	
              60,000,000

               

            
	
              The
                Bank of Tokyo-Mitsubishi UFJ, Ltd., New York Branch

            	
              50,000,000

               

            
	
              Calyon

            	
              45,000,000

               

            
	
              Bayerische
                Hypo-und Vereinsbank AG

            	
              25,000,000

               

            
	
              Commerzbank
                Aktiengesellschaft

            	
              25,000,000

               

            
	
              Landesbank
                Hessen-Thüringen Girozentrale

            	
              25,000,000

               

            
	
              Mizuho
                Corporate Bank, Ltd.

            	
              25,000,000

               

            
	
              TOTAL

            	
              450,000,000

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    SCHEDULE
      2

     

    

     

    INDEBTEDNESS
      AND LIENS

     

    

     

    Part
      A

     

    Indebtedness

     

    
      	
              1.

            	
              Credit
                Agreement dated as of June 22, 2005 between XL Capital Ltd, X.L.
                America,
                Inc., XL Insurance (Bermuda) Ltd and XL Re Ltd, as account parties
                and
                guarantors, the lenders party thereto and JPMorgan Chase Bank, as
                administrative agent.

            

    

     

    
      	
              2.

            	
              Amendment
                No. 1 dated May 5, 2006 to JPMorgan Chase Bank Credit Agreement dated
                as
                of June 22, 2005.

            

    

     

    
      	
              3.

            	
              Credit
                Agreement dated as of June 21, 2007 between XL Capital Ltd, X.L.
                America,
                Inc., XL Insurance (Bermuda) Ltd and XL Re Ltd, as account parties
                and
                guarantors, the lenders party thereto and JPMorgan Chase Bank, as
                administrative agent.

            

    

     

    
      	
              4.

            	
              Credit
                Agreement dated as of August 3, 2005 between XL Capital Ltd, X.L.
                America,
                Inc., XL Insurance (Bermuda) Ltd and XL Re Ltd, as borrowers and
                guarantors, and Bear Stearns Corporate Lending Inc., as
                lender.

            

    

     

    
      	
              5.

            	
              Amendment
                No. 1 dated as of May 9, 2006 to the Bear Stearns Corporate Lending
                Inc.
                Credit Agreement dated as of August 3,
                2005.

            

    

     

    
      	
              6.

            	
              Letter
                of Credit Facility and Reimbursement Agreement dated March 14, 2006,
                between XL Capital Ltd, as account party and XL Capital Ltd, X.L.
                America,
                Inc., XL Insurance (Bermuda) Ltd and XL Re Ltd, as guarantors and
                Citibank
                International plc, as agent and trustee for the lenders party
                thereto.

            

    

     

    
      	
              7.

            	
              Letter
                of Amendment dated May 16, 2006 to Letter of Credit and Reimbursement
                Agreement dated March 16, 2006 between XL Capital Ltd, as account
                party
                and XL Capital Ltd, X.L. America, Inc., XL Insurance (Bermuda) Ltd
                and XL
                Re Ltd, as guarantors and Citibank International plc, as agent and
                trustee
                for the lenders party thereto.

            

    

     

    
      	
              8.

            	
              6.58%
                guaranteed senior notes due April 12, 2011, under the Note Purchase
                Agreement dated as of April 12, 2001, issued by X.L. America, Inc.
                and
                guaranteed by XL Capital Ltd, XL Insurance (Bermuda) Ltd, and XL
                Re
                Ltd.

            

    

     

    
      	
              9.

            	
              Amendment
                No. 1 to Note Purchase Agreement dated as of May 31, 2006 to the
                Note
                Purchase Agreement dated as of April 12, 2001 among X.L. America
                Inc., XL
                Capital Ltd, XL Insurance (Bermuda) Ltd and XL Re
                Ltd.

            

    

     

    
      	
              10.

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

            

    

     

    
      	
              11.

            	
              Master
                Standby Letter of Credit and Reimbursement Agreement dated as of
                September
                30, 2005, among National Australia Bank Limited, New York Branch
                and XL
                Capital Ltd, XL America, Inc, XL Insurance (Bermuda) Ltd and XL Re
                Ltd, as
                account parties.

            

    

     

    
      	
              12.

            	
              Amendment
                Agreement, dated as of December 30, 2005 to Master Standby Letter
                of
                Credit and Reimbursement Agreement dated as of September 30, 2005,
                among
                National Australia Bank Limited, New York Branch and XL Capital Ltd,
                XL
                America, Inc, XL Insurance (Bermuda) Ltd and XL Re Ltd, as account
                parties.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
              13.

            	
              Second
                Amendment Agreement dated as of May 26, 2006 to National Australia
                Bank
                Limited, New York  Branch Master Standby Letter of Credit and
                Reimbursement Agreement dated as of September 30,
                2005.

            

    

     

    
      	
              14.

            	
              Third
                Amendment Agreement dated as of December 19, 2006 to National Australia
                Bank Limited, New York Branch Master Standby Letter of Credit and
                Reimbursement Agreement dated as of September 30,
                2005.

            

    

     

    
      	
              15.

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

            

    

     

    
      	
              16.

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

            

    

     

    
      	
              17.

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

            

    

     

    
      	
              18.

            	
              5.25%
                Senior Notes due February 15, 2011, under the Third Supplemental
                Indenture, dated as of December 9, 2005, to the Indenture, dated
                as of
                June 2, 2004, between XL Capital Ltd and The Bank of New York, as
                trustee.

            

    

     

    
      	
              19.

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

            

    

     

    
      	
              20.

            	
              Replacement
                Capital Covenant, dated March 15,
                2007.

            

    

     

    
      	
              21.

            	
              Facility
                Letter dated August 18, 2006 between XL Insurance (Bermuda) Ltd,
                XL Re
                Ltd, XL Capital Ltd and The Bank of
                Bermuda.

            

    

     

    
      	
              22.

            	
              Amendment
                Letter Agreement dated August 1, 2007 to Facility Letter dated August
                18,
                2006 between XL Insurance (Bermuda) Ltd, XL Re Ltd, XL Capital Ltd
                and The
                Bank of Bermuda.

            

    

     

    
      	
              23.

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

            

    

     

    
      	
              24.

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

            

    

     

    
      	
              25.

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

            

    

     

    
      	
              26.

            	
              Reinsurance
                Standby Letter of Credit Agreement dated October 7, 1999, between
                XL Re
                Europe Limited (formerly known as Le Mans Re) and BNP
                Paribas.

            

    

     

    
      	
              27.

            	
              First
                Renewal dated November 27, 2000, to the Reinsurance Standby Letter
                of
                Credit Agreement dated October 7, 1999, between XL Re Europe Limited
                (formerly known as Le Mans Re) and BNP
                Paribas.

            

    

     

    
      	
              28.

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

            

    

     

    
      	
              29.

            	
              Customer
                Agreement dated May 7, 2002, between XL Trading Partners Ltd and
                JP Morgan
                Chase Futures, Inc. (formerly known as Banc One Capital Markets,
                Inc.).

            

    

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

    
      	
              30.

            	
              International
                Uniform Brokerage Execution Services (“Give-Up”) Agreement dated February
                6, 2002, among JP Morgan Chase Futures, Inc. (formerly known as Banc
                One
                Capital Markets, Inc.), as Executing Broker, and GNI Incorporated,
                as
                Clearing Broker and XL Trading Partners
                Ltd.

            

    

     

    
      	
              31.

            	
              Revolving
                Credit and Security Agreement dated as of February 25, 2003, between
                XL Re
                Ltd as borrower, Corporate Asset Funding Company, Inc., Corporate
                Receivables Corporation, Charta Corporation, Ciesco, L.P., and Citibank,
                N.A., as lenders thereto and Citicorp North America, Inc. as
                agent.

            

    

     

    
      	
              32.

            	
              Agreement
                of Amendment, dated as of February 23, 2004, to the Revolving Credit
                and
                Security Agreement, dated as of February 25, 2003, among XL Re Ltd,
                as
                Borrower, CAFCO, LLC (formerly Corporate Asset Funding Company, Inc.),
                CRC
                Funding, LLC (formerly Corporate Receivables Corporation), CHARTA,
                LLC
                (formerly CHARTA Corporation) and CIESCO, LLC (formerly CIESCO, L.P.),
                as
                Lenders, Citibank, N.A. and the other Secondary Lenders from time
                to time
                parties thereto, as Secondary Lenders, and Citicorp North America,
                Inc.,
                as Agent.

            

    

     

    
      	
              33.

            	
              Amendment
                dated as of May 10, 2004, to the Revolving Credit and Security Agreement
                dated as of February 25, 2003, among XL Re Ltd as the borrower, CAFCO,
                LLC, CRC Funding, LLC, CHARTA, LLC, CIESCO, LLC, Citibank, N.A. and
                Citicorp North America, Inc., as the
                agent.

            

    

     

    
      	
              34.

            	
              Agreement
                of Amendment, dated as of February 18, 2005, to the Revolving Credit
                and
                Security Agreement, dated as of February 25, 2003, among XL Re Ltd,
                as
                Borrower, CAFCO, LLC (formerly Corporate Asset Funding Company, Inc.),
                CRC
                Funding, LLC (formerly Corporate Receivables Corporation), CHARTA,
                LLC
                (formerly CHARTA Corporation) and CIESCO, LLC (formerly CIESCO, L.P.),
                as
                Lenders, Citibank, N.A. and the other Secondary Lenders from time
                to time
                parties thereto, as Secondary Lenders, and Citicorp North America,
                Inc.,
                as Agent.

            

    

     

    
      	
              35.

            	
              Agreement
                of Amendment, dated as of February 16, 2006, to the Revolving Credit
                and
                Security Agreement, dated as of February 25, 2003, among XL Re Ltd,
                as
                Borrower, CAFCO, LLC (formerly Corporate Asset Funding Company, Inc.),
                CRC
                Funding, LLC (formerly Corporate Receivables Corporation), CHARTA,
                LLC
                (formerly CHARTA Corporation) and CIESCO, LLC (formerly CIESCO, L.P.),
                as
                Lenders, Citibank, N.A. and the other Secondary Lenders from time
                to time
                parties thereto, as Secondary Lenders, and Citicorp North America,
                Inc.,
                as Agent.

            

    

     

    
      	
              36.

            	
              Agreement
                of Amendment dated as of September 29, 2006, to the Revolving Credit
                and
                Security Agreement dated as of February 25, 2003, among XL Re Ltd
                as the
                borrower, CAFCO, LLC, CRC Funding, LLC, CHARTA, LLC, CIESCO, LLC,
                Citibank, N.A. and Citicorp North America, Inc., as the
                agent.

            

    

     

    
      	
              37.

            	
              Agreement
                of Amendment dated as of February 14, 2007, to the Revolving Credit
                and
                Security Agreement dated as of February 25, 2003, among XL Re Ltd
                as the
                borrower, CAFCO, LLC, CRC Funding, LLC, CHARTA, LLC, CIESCO, LLC,
                Citibank, N.A. and Citicorp North America, Inc., as the
                agent.

            

    

     

    
      	
              38.

            	
              Control
                Agreement dated as of February 25, 2003, among XL Re Ltd as the borrower,
                Citibank North America, Inc. as the Agent and Mellon Bank, N.A.,
                as the
                securities intermediary.

            

    

     

    
      	
              39.

            	
              Amendment
                dated as of May 10, 2004, to the Control Agreement dated as of February
                25, 2003, among XL Re Ltd as the borrower, Citibank North America,
                Inc. as
                the Agent and Mellon Bank, N.A., as the securities
                intermediary.

            

    

     

    
      	
              40.

            	
              Agreement
                of Amendment, dated as of February 16, 2006 to the Control Agreement
                dated
                as of February 25, 2003, among XL Re Ltd as the borrower, Citibank
                North
                America, Inc. as the Agent and Mellon Bank, N.A., as the securities
                intermediary.

            

    

     

    
      	
              41.

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

            

    

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

    
      	
               

            	
              Part
                B

            

    

     

    
      	
               

            	
              Liens

            

    

     

    
      	
              1.

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

            

    

     

    
      	
              2.

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

            

    

     

    
      	
              3.

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

            

    

     

    
      	
              4.

            	
              Reinsurance
                Standby Letter of Credit Agreement dated October 7, 1999,
                between  XL Re Europe Limited (formerly known as Le Mans Re) and
                BNP Paribas.

            

    

     

    
      	
              5.

            	
              First
                Renewal dated November 27, 2000, to the Reinsurance Standby Letter
                of
                Credit Agreement dated October 7, 1999, between XL Re Europe Limited
                (formerly known as Le Mans Re) and BNP
                Paribas.

            

    

     

    
      	
              6.

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

            

    

     

    
      	
              7.

            	
              Customer
                Agreement dated May 7, 2002, between XL Trading Partners Ltd and
                JP Morgan
                Chase Futures, Inc. (formerly known as Banc One Capital Markets,
                Inc.).

            

    

     

    
      	
              8.

            	
              International
                Uniform Brokerage Execution Services (“Give-Up”) Agreement dated February
                6, 2002, among JP Morgan Chase Futures, Inc. (formerly known as Banc
                One
                Capital Markets, Inc.), as Executing Broker, and GNI Incorporated,
                as
                Clearing Broker and XL Trading Partners
                Ltd.

            

    

     

    
      	
              9.

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

            

    

     

    Part
      C - Actions, Suits and Proceedings

     

    None.

     

    Part
      D - Environmental Matters

     

    None.

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

    SCHEDULE
      3

    

    SUBSIDIARIES

    
      3rd
        Quarter 2007

       

      
 

      
        
          	 	 	 	 	 	 	 	 	 	 	 	
                  %

                	
                  JURISDICTION

                
	
                  XL
                    Capital Ltd

                	 	
                  Cayman

                
	 	
                  EXEL
                    Holdings Limited

                	 	
                  Cayman

                
	 	 	 	
                  EXEL
                    Acquisition Ltd.

                	 	
                  Cayman

                
	 	 	 	 	
                  GCR
                    Holdings Limited (in liquidaton)

                	 	
                  Cayman

                
	 	 	 	
                  Reeve
                    Court Holdings Ltd.

                	 	
                  Bermuda

                
	 	 	 	
                  X.L.
                    Property Holdings Limited

                	 	
                  Bermuda

                
	 	 	 	
                  XL
                    Insurance (Bermuda) Ltd.

                	 	
                  Bermuda

                
	 	 	 	 	
                  XL
                    Weather & Energy Ltd (formerly Element Reinsurance
                    Ltd)

                	 	
                  Bermuda

                
	 	 	 	 	
                  XL
                    PP Limited

                	 	
                  UK

                
	 	 	 	 	
                  InQuisCapital
                    Holdings (Bermuda) Limited

                	 	
                  Bermuda

                
	 	 	 	 	 	
                  InQuisLogic
                    (Bermuda) Limited

                	 	
                  Bermuda

                
	 	 	 	 	 	
                  RiskConnect
                    Limited

                	 	
                  Bermuda

                
	 	 	 	 	
                  XL
                    International (Bermuda) Ltd (formerly XL Winterthur International
                    (Bermuda) Ltd)

                	
                  91

                	
                  Bermuda

                
	 	 	 	 	
                  XL
                    International Services Ltd (formerly XL Winterthur International
                    Services)

                	 	
                  Bermuda

                
	 	 	 	 	 	
                  International
                    Insurance Consulting Services Limited

                	 	
                  Bermuda

                
	 	 	 	 	
                  XL
                    (Brazil) Holdings Ltda (formerly Winterthur Administracao e
                    Participacoes Ltda)

                	 	
                  Brazil

                
	 	 	 	 	
                  XL
                    Capital Products Ltd

                	 	
                  Bermuda

                
	 	 	 	 	
                  XL
                    Financial Solutions Ltd

                	 	
                  Bermuda

                
	 	 	 	 	
                  XL
                    Services (Bermuda) Ltd

                	 	
                  Bermuda

                
	 	 	 	 	
                  XL
                    Swiss Holdings Ltd

                	
                  24

                	
                  Switzerland

                
	 	 	 	 	
                  XL
                    Life Ltd

                	 	
                  Bermuda

                
	 	 	 	 	 	
                  Reeve
                    Court General Partner Limited

                	 	
                  Bermuda

                
	 	 	 	 	 	 	
                  Reeve
                    Court 4 Limited Partnership

                	 	
                  Bermuda

                
	 	 	 	 	 	 	
                  Reeve
                    Court 6 Limited Partnership

                	 	
                  Bermuda

                
	 	 	 	 	
                  XL
                    Gracechurch Limited

                	 	
                  UK

                
	 	 	 	 	 	
                  XL
                    Insurance (UK) Holdings Limited (formerly XL Winterthur (UK)
                    Holdings
                    Limited

                	
                  42.33

                	
                  UK

                
	 	 	 	 	
                  XL
                    Financial Holdings (Ireland) Limited

                	 	
                  R
                    of Ireland

                
	 	 	 	 	 	
                  XL
                    Europe Limited

                	 	
                  R
                    of Ireland

                
	 	 	 	 	 	 	
                  XL
                    Re Europe Services AG

                	 	
                  Germany

                
	 	 	 	 	 	
                  XL
                    Services Canada Ltd. (Formerly XL Re Europe Management Company
                    Ltd.)

                	 	
                  Canada

                
	 	 	 	 	 	
                  XL
                    Re Europe Limited

                	 	
                  R
                    of Ireland

                
	 	 	 	 	
                  X.L.
                    America, Inc.

                	 	
                  Delaware

                
	 	 	 	 	 	 	
                  XL
                    Financial Solutions, Inc.

                	 	
                  Delaware

                
	 	 	 	 	 	 	
                  XL
                    Capital Investment Partners Inc.

                	 	
                  Delaware

                
	 	 	 	 	 	 	
                  XL
                    Weather & Energy Inc. (formerly Element Re Capital Products
                    Inc.)

                	 	
                  Delaware

                
	 	 	 	 	 	 	
                  XLA
                    Garrison L.P.

                	 	
                  Delaware

                
	 	 	 	 	 	 	
                  Global
                    Credit Analytics, Inc.

                	 	
                  Delaware

                
	 	 	 	 	 	 	
                  NAC
                    Re Corporation

                	 	
                  Delaware

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

                	 	
                  New
                    York

                
	 	 	 	 	 	 	 	 	
                  Greenwich
                    Insurance Company *(A-12%)

                	 	
                  Delaware

                
	 	 	 	 	 	 	 	 	 	
                  Warranty
                    Support Services LLC

                	 	
                  Delaware

                
	 	 	 	 	 	 	 	 	 	
                  XL
                    Insurance America, Inc. *(A-10%) (formerly Winterthur
                    International America Insurance Company)

                	 	
                   

                  Delaware

                
	 	 	 	 	 	 	 	 	 	 	
                  XL
                    Select Insurance Company *(formerly Winterthur International America
                    Underwriters Insurance Co.)

                	 	
                   

                  Oklahoma

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

                	 	
                  New
                    York

                
	 	 	 	 	 	 	 	 	
                  XL
                    Specialty Insurance Company *(A-6%)

                	 	
                  Delaware

                
	 	 	 	 	 	 	 	 	 	
                  Indian
                    Harbor Insurance Company *(A-2%)

                	 	
                  North
                    Dakota

                
	 	 	 	 	 	 	 	 	 	
                  XL
                    Management Services, LLC

                	 	
                  Texas

                
	 	 	 	 	 	 	 	 	 	
                  XL
                    Lloyds Insurance Company

                	 	
                  Texas

                
	 	 	 	 	 	 	
                  37
                    Lambert Road LLC

                	 	
                  Delaware

                
	 	 	 	 	 	 	
                  XL
                    Global, Inc.

                	 	
                  Delaware

                
	 	 	 	 	 	 	
                  XL
                    Insurance, Inc.

                	 	
                  Delaware

                
	 	 	 	 	 	 	
                  XL
                    Global Services, Inc.

                	 	
                  Delaware

                
	 	 	 	 	 	 	 	
                  XL
                    Investment Management (USA) LLC

                	 	
                  Delaware

                
	 	 	 	 	 	 	 	
                  Eagleview
                    Insurance Brokerage Services, LLC

                	 	
                  Delaware

                
	 	 	 	 	 	 	
                  XL
                    Life and Annuity Holding Company

                	 	
                  Delaware

                
	 	 	 	 	 	 	 	
                  XL
                    Life Insurance and Annuity Company (formerly Lyndon Life Insurance
                    Company)

                	 	
                  Illinois

                
	 	 	 	 	 	 	 	
                  XL
                    Asset Funding Company I LLC

                	 	
                  Delaware

                
	 	 	 	 	 	 	 	
                  XL
                    Re Life America Inc

                	 	
                  Delaware

                
	 	 	 	 	 	 	
                  ECS,
                    Inc. (In Liquidation)

                	 	
                  Pennsylvania

                
	 	 	 	 	 	 	 	
                  ECS
                    Risk & Insurance Services, Inc.

                	 	
                  Pennsylvania

                
	 	 	 	 	 	 	
                  ECS
                    Child Care Center, Inc.

                	 	
                  Barbados

                
	 	 	 	 	 	 	
                  XL
                    Environmental Ltd

                	 	
                  UK

                
	 	 	 	
                  XL
                    Investments Ltd

                	 	
                  Bermuda

                
	 	 	 	 	
                  XL
                    SGS Holdings Inc.

                	 	
                  Delaware

                
	 	 	 	 	
                  Garrison
                    Investments Inc. (**)

                	 	
                  Barbados

                
	 	 	 	 	
                  InQuisLogic
                    Ltd.

                	 	
                  Barbados

                
	 	 	 	 	
                  Kensington
                    Investments Inc.

                	 	
                  Barbados

                
	 	 	 	 	 	
                  XLB
                    Partners Inc.

                	 	
                  Barbados

                
	 	 	 	 	 	
                  Cumberland
                    Holdings, Inc.

                	 	
                  Delaware

                
	 	 	 	 	 	 	
                  Cumberland
                    California, Inc.

                	 	
                  Delaware

                
	 	 	 	 	 	 	
                  Cumberland
                    New York, Inc.

                	 	
                  Delaware

                
	 	 	 	 	
                  RiskConnect
                    Ltd

                	 	
                  Barbados

                
	 	 	 	 	
                  X.L.
                    Investment Private Trustee Ltd.

                	 	
                  Bermuda

                
	 	 	 	 	 	
                  XL
                    Investments (Barbados) Inc.

                	 	
                  Barbados

                
	 	 	 	 	 	 	
                  Cybersettle,
                    Inc.

                	
                  56

                	
                  Delaware

                
	 	 	 	 	 	 	 	
                  Cybersettle
                    Insurance Brokerage Services LLC

                	 	
                  Delaware

                
	 	 	 	 	 	 	 	
                  Cybersettle
                    Financial Services LLC

                	 	
                  Delaware

                

        

        
          	 	 	 	 	
                  ClearWater
                    Opportunity Fund Ltd.

                	 	
                  Cayman

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

                	 	
                  Luxembourg

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

                	 	
                  Luxembourg

                

        

         

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

                	 	
                  Luxembourg

                

        

         

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

                	 	
                  Luxembourg

                

        

        

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

                	 	
                  Luxembourg

                

        

        

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

                	 	
                  Luxembourg

                

        

        

        
          	 	 	 	 	 	 	 	 	 	 	
                  XL
                    Insurance UK Holdings Limited

                	
                  57.67%

                	
                  UK

                
	 	 	 	 	 	 	 	 	 	 	 	
                  ITAU
                    XL Seguros Corporativos S.A.

                	
                  49%

                	
                  Brazil

                
	 	 	 	 	 	 	 	 	 	 	 	
                  XL
                    Re Latin America (Argentina SA)

                	
                  20%

                	
                  Switzerland

                
	 	 	 	 	 	 	 	 	 	 	 	
                  XL
                    Re Latin America Ltd

                	 	
                  Switzerland

                
	 	 	 	 	 	 	 	 	 	 	 	 	
                  XL
                    Latin America Investments Ltd

                	 	
                  Bermuda

                	 
	 	 	 	 	 	 	 	 	 	 	 	 	
                  XL
                    Re Latin America (Argentina SA)

                	
                  80%

                	
                  Argentina

                	 
	 	 	 	 	 	 	 	 	 	 	 	 	
                  XL
                    Re Latin America Servicos Ltda

                	 	
                  Brazil

                	 
	 	 	 	 	 	 	 	 	 	 	 	
                  XL
                    Insurance Switzerland (formerly XL Winterthur International Insurance
                    Switzerland)

                	 	
                   

                  Switzerland

                	 
	 	 	 	 	 	 	 	 	 	 	 	
                  Vitodurum
                    Reinsurance Company (Formerly XL Winterthur International
                    Re)

                	 	
                  Switzerland

                	 
	 	 	 	 	 	 	 	 	 	 	 	
                  XL
                    Services Switzerland

                	 	
                  Switzerland

                	 
	 	 	 	 	 	 	 	 	 	 	 	
                  XL
                    India Business Services Private Limited

                	 	
                  India

                	 
	 	 	 	 	 	 	 	 	 	 	 	
                  XL
                    Insurance Mexico

                	 	
                  Mexico

                	 
	 	 	 	 	 	 	 	 	 	
                  XL
                    Insurance (UK) Holdings Limited (formerly XL Winterthur (UK) Holdings
                    Limited)

                	
                  57.67

                	
                  UK

                	 
	 	 	 	 	 	 	 	 	 	 	
                  XL
                    Insurance Argentina S.A. Compañia de Seguros (formerly Winterthur
                    International Argentina SA)

                	
                  90

                	
                   

                  Argentina

                	 
	 	 	 	 	 	 	 	 	 	 	
                  XL
                    Insurance Company Limited (formerly XL Winterthur International
                    Insurance Company Limited)

                	 	
                   

                  UK

                	 
	 	 	 	 	 	 	 	 	 	 	 	
                  XL
                    Magyarorszag Biztosito Reszvenytarsasag

                	 	
                  Hungary

                	 
	 	 	 	 	 	 	 	 	 	 	 	
                  XL
                    Insurance Argentina S.A. Compañia de Seguros (formerly Winterthur
                    International Argentina SA Co)

                	
                  10

                	
                   

                  Argentina

                	 
	 	 	 	 	 	 	 	 	 	 	 	
                  XL
                    Holdings (Proprietary) Limited (formerly XL Winterthur Holdings
                    (Proprietary) Limited)

                	 	
                   

                  South
                    Africa

                	 
	 	 	 	 	 	 	 	 	 	 	 	 	
                  XL
                    Winterthur Properties (Proprietary) Limited

                	 	
                  South
                    Africa

                	 
	 	 	 	 	 	 	 	 	 	 	 	 	
                  XL
                    Insurance Company Limited (formerly XL Winterthur International
                    Insurance Company Limited)

                	 	
                   

                  South
                    Africa

                	 
	 	 	 	 	 	 	 	 	 	 	
                  XL
                    Services UK Limited

                	 	
                  UK

                	 
	 	 	 	
                  XL
                    Trading Partners Ltd

                	 	
                  Bermuda

                	 
	 	 	 	
                  XL
                    Europe Holdings Ltd (formerly X.L. Two Ltd.)

                	 	
                  Bermuda

                	 
	 	 	 	 	
                  XL
                    Europe Ltd

                	 	
                  R
                    of Ireland

                	 
	 	 	 	 	
                  XL
                    Financial Services (Ireland) Ltd.

                	 	
                  R
                    of Ireland

                	 
	 	
                  Mid
                    Ocean Limited

                	 	
                  Cayman

                	 
	 	 	
                  Mid
                    Ocean Holdings Limited

                	 	
                  Bermuda

                	 
	 	 	 	
                  Ridgewood
                    Holdings Limited

                	 	
                  Bermuda

                	 
	 	 	 	 	
                  XL
                    London Market Group Ltd

                	 	
                  UK

                	 
	 	 	 	 	 	
                  Brockbank
                    Holdings Limited

                	 	
                  UK

                	 
	 	 	 	 	 	 	
                  Baltusorl
                    Holdings Limited

                	 	
                  Bermuda

                	 
	 	 	 	 	 	
                  County
                    Down Limited

                	 	
                  UK

                	 
	 	 	 	 	 	
                  Dornoch
                    Limited

                	 	
                  UK

                	 
	 	 	 	 	 	
                  Stonebridge
                    Underwriting Limited

                	 	
                  UK

                	 
	 	 	 	 	 	
                  XL
                    London market Services Ltd

                	 	
                  UK

                	 
	 	 	 	 	 	 	
                  Brockbank
                    Personal Lines Limited - (Dormant)

                	 	
                  UK

                	 
	 	 	 	 	 	 	
                  Cassidy
                    Brockbank Limited - (Dormant)

                	 	
                  UK

                	 
	 	 	 	 	 	 	
                  Denham
                    Syndicate Management Limited

                	 	
                  UK

                	 
	 	 	 	 	 	 	 	
                  Denham
                    Direct Underwriters Ltd.

                	 	
                  UK

                	 
	 	 	 	 	 	 	 	 	
                  Denham
                    Legal and Professional Risks Ltd.

                	 	
                  UK

                	 
	 	 	 	 	 	 	 	 	
                  Denham
                    Tower Underwriting Agents (PTY) Limited

                	 	
                  South
                    Africa

                	 
	 	 	 	 	 	 	
                  XL
                    London Market Ltd - Syndicates 588/861/990/1209

                	 	
                  UK

                	 
	 	 	 	 	 	 	 	
                  Brockbank
                    Syndicate Services Limited

                	 	
                  UK

                	 
	 	 	 	 	
                  XL
                    Capital International Limited

                	 	
                  UK

                	 
	 	 	 	 	 	
                  Xl
                    Capital Finance (Europe) plc

                	 	
                  UK

                	 
	 	 	 	 	
                  XL
                    Financial Products Ltd.

                	 	
                  UK

                	 
	 	 	 	
                  XL
                    Re Ltd

                	 	
                  Bermuda

                	 
	 	 	 	 	
                  XL
                    BCM Limited

                	 	
                  UK

                	 
	 	 	 	 	
                  XL
                    CCM Ltd

                	 	
                  UK

                	 
	 	 	 	 	
                  ECS
                    Reinsurance Company Inc.

                	 	
                  Barbados

                	 
	 	 	 	
                  XL
                    FC Limited

                	 	
                  UK

                	 
	 	 	 	 	
                  Global
                    Capital Underwriting Ltd.

                	 	
                  UK

                	 
	 	 	 	 	
                  XL
                    BCM Limited

                	 	
                  UK

                	 
	 	 	 	 	
                  XL
                    Mid Ocean Re Limited

                	 	
                  UK

                	 
	 	
                  XL
                    Investment Management Ltd.

                	 	
                  Bermuda

                	 
	 	
                  XL
                    Capital Partners Corporation

                	 	
                  Cayman

                	 
	 	 	
                  XL
                    Capital Partners I, L.P.

                	 	
                  Cayman

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

                	
                  50

                	
                  Delaware

                	 
	 	 	
                  XL
                    Principal Partners I, L.P.

                	 	
                  Cayman

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

                	
                  50

                	
                  Delaware

                	 

        

      

    

    
 

    *A
      =
      Company is a member of NAC Reinsurance, Intercargo Pooling Agreement with
      individual company pooling % noted

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

    

    Significant
      Subsidiaries as at 31 December 2006

    

    XL
      Re
      Ltd                      

    XL
      Insurance America

    XL
      Insurance (Bermuda) Ltd

    XL
      Re
      America

    XL
      Life
      Ltd

    
      
        
        

      

      
         

        
          

        

      

      
        
        

      

    

    SCHEDULE
      4

     

    

     

    MANDATORY COSTS
      RATE

     

    
      	
              1.

            	
              The
                Mandatory Cost is an addition to the interest rate on a Demand Amount
                to
                compensate Lenders for the cost of compliance with (a) the requirements
                of
                the Bank of England and/or the Financial Services Authority (or,
                in either
                case, any other authority which replaces all or any of its functions)
                or
                (b) the requirements of the European Central
                Bank.

            

    

     

    
      	
              2.

            	
              On
                the first day of a Default Period (or as soon as possible thereafter)
                the
                Agent shall calculate, as a percentage rate, a rate (the
                Additional Cost Rate) for each Lender, in
                accordance with the paragraphs set out below.  The Mandatory
                Cost will be calculated by the Agent as a weighted average of the
                Lenders’
                Additional Cost Rates (weighted in proportion to the percentage
                participation of each Lender in the relevant Letter of Credit) and
                will be
                expressed as a percentage rate per
                annum.

            

    

     

    
      	
              3.

            	
              The
                Additional Cost Rate for any Lender funding or booking from a Facility
                Office in a Participating Member State will be the percentage notified
                by
                that Lender to the Agent.  This percentage will be certified by
                that Lender in its notice to the Agent to be its reasonable determination
                of the cost (expressed as a percentage of that Lender’s participation in
                all Letters of Credit funded or booked from that Facility Office)
                of
                complying with the minimum reserve requirements of the European Central
                Bank in respect of loans made from that Facility
                Office.

            

    

     

    
      	
              4.

            	
              The
                Additional Cost Rate for any Lender funding or booking from a Facility
                Office in the United Kingdom will be calculated by the Agent as
                follows:

            

    

    
 

    
      
        	
                [

              	
                
                  AB
                    + C(B - D) + E  x  0.01

                

              	
                 
                  per cent. per annum

              	
                ]

              
	
                100
                  - (A + C)

              

      

    

     

    Where:

     

    
      	
               

            	
              A

            	
              is
                the percentage of Eligible Liabilities (assuming these to be in excess
                of
                any stated minimum) which that Lender is from time to time required
                to
                maintain as an interest free cash ratio deposit with the Bank of
                England
                to comply with cash ratio
                requirements.

            

    

     

    
      	
               

            	
              B

            	
              is
                the percentage rate of interest (excluding the Mandatory Cost and
                the
                additional rate of interest specified in item (i) of Clause 7 (Default
                Interest)) payable for the relevant Default Period on the
                Loan.

            

    

     

    
      	
               

            	
              C

            	
              is
                the percentage (if any) of Eligible Liabilities which that Lender
                is
                required from time to time to maintain as interest bearing Special
                Deposits with the Bank of England.

            

    

     

    
      	
               

            	
              D

            	
              is
                the percentage rate per annum payable by the Bank of England to the
                Agent
                on interest bearing Special
                Deposits.

            

    

     

    
      	
               

            	
              E

            	
              is
                designed to compensate Lenders for amounts payable under the Fees
                Rules
                and is calculated by the Agent as being the average of the most recent
                rates of charge supplied by the Reference Banks to the Agent pursuant
                to
                paragraph 7 and expressed in pounds per
                £1,000,000.

            

    

     

    
      	
              5.

            	
              For
                the purposes of this Schedule:

            

    

     

    
      	
               

            	
              (a)

            	
              Eligible
                Liabilities and Special Deposits have the
                meanings given to them from time to time under or pursuant to the
                Bank of
                England Act 1998 or (as may be appropriate) by the Bank of
                England;

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
               

            	
              (b)

            	
              Fees
                Rules means the rules on periodic fees contained in the FSA
                Supervision Manual or such other law or regulation as may be in force
                from
                time to time in respect of the payment of fees for the acceptance
                of
                deposits;

            

    

     

    
      	
               

            	
              (c)

            	
              Fee
                Tariffs means the fee tariffs specified in the Fees Rules under
                the activity group A.1 Deposit acceptors (ignoring any minimum fee
                or zero
                rated fee required pursuant to the Fees Rules but taking into account
                any
                applicable discount rate); and

            

    

     

    
      	
               

            	
              (d)

            	
              Tariff
                Base has the meaning given to it in, and will be calculated
                in
                accordance with, the Fees Rules.

            

    

     

    
      	
              6.

            	
              In
                application of the above formula, A, B, C and D will be included
                in the
                formula as percentages (i.e. 5 per cent. will be included in the
                formula
                as 5 and not as 0.05).  A negative result obtained by
                subtracting D from B shall be taken as zero.  The resulting
                figures shall be rounded to four decimal
                places.

            

    

     

    
      	
              7.

            	
              If
                requested by the Agent, each Reference Bank shall, as soon as practicable
                after publication by the Financial Services Authority, supply to
                the
                Agent, the rate of charge payable by that Reference Bank to the Financial
                Services Authority pursuant to the Fees Rules in respect of the relevant
                financial year of the Financial Services Authority (calculated for
                this
                purpose by that Reference Bank as being the average of the Fee Tariffs
                applicable to that Reference Bank for that financial year) and expressed
                in pounds per £1,000,000 of the Tariff Base of that Reference
                Bank.

            

    

     

    
      	
              8.

            	
              Each
                Lender shall supply any information required by the Agent for the
                purpose
                of calculating its Additional Cost Rate. In particular, but without
                limitation, each Lender shall supply the following information on
                or prior
                to the date on which it becomes a
                Lender:

            

    

     

    
      	
               

            	
              (a)

            	
              the
                jurisdiction of its Facility Office;
                and

            

    

     

    
      	
               

            	
              (b)

            	
              any
                other information that the Agent may reasonably require for such
                purpose.

            

    

     

    Each
      Lender shall promptly notify the Agent of any change to the information provided
      by it pursuant to this paragraph.

     

    
      	
              9.

            	
              The
                percentages of each Lender for the purpose of A and C above and the
                rates
                of charge of each Reference Bank for the purpose of E above shall
                be
                determined by the Agent based upon the information supplied to it
                pursuant
                to paragraphs 7 and 8 and on the assumption that, unless a Lender
                notifies the Agent to the contrary, each Lender’s obligations in relation
                to cash ratio deposits and Special Deposits are the same as those
                of a
                typical bank from its jurisdiction of incorporation with a Facility
                Office
                in the same jurisdiction as its Facility
                Office.

            

    

     

    
      	
              10.

            	
              The
                Agent shall have no liability to any person if such determination
                results
                in an Additional Cost Rate which over or under compensates any Lender
                and
                shall be entitled to assume that the information provided by any
                Lender or
                Reference Bank pursuant to paragraphs 3, 7 and 8is true and correct
                in all
                respects.

            

    

     

    
      	
              11.

            	
              The
                Agent shall distribute the additional amounts received as a result
                of the
                Mandatory Cost to the Lenders on the basis of the Additional Cost
                Rate for
                each Lender based on the information provided by each Lender and
                each
                Reference Bank pursuant to paragraphs 3, 7 and
                8.

            

    

     

    
      	
              12.

            	
              Any
                determination by the Agent pursuant to this Schedule in relation
                to a
                formula, the Mandatory Cost, an Additional Cost Rate or any amount
                payable
                to a Lender shall, in the absence of manifest error, be conclusive
                and
                binding on all Parties.

            

    

     

    
      	
              13.

            	
              The
                Agent may from time to time, after consultation with the Account
                Party and
                the Lenders, determine and notify to all parties any amendments which
                are
                required to be made to this Schedule in order to comply with any
                change in
                law, regulation or any requirements from time to time imposed by
                the Bank
                of England, the

            

    

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

    
      	
               

            	
              Financial
                Services Authority or the European Central Bank (or, in any case,
                any
                other authority which replaces all or any of its functions) and any
                such
                determination shall, in the absence of manifest error, be conclusive
                and
                binding on all Parties.

            

    

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

    SCHEDULE
      5

     

    

     

    CONDITIONS
      PRECEDENT

     

    
      	
              1.

            	
              In
                relation to each Obligor:

            

    

     

    
      	
              (a)

            	
              a
                copy, certified on or about the date of this Agreement a true and
                up-to-date copy by an Authorised Signatory of such Obligor, of the
                constitutional documents of such
                Obligor;

            

    

     

    
      	
              (b)

            	
              a
                copy, certified as at the date of this Agreement a true and up-to-date
                copy by an Authorised Signatory of such Obligor, of a board resolution
                of
                such Obligor approving the execution, delivery and performance of
                the
                Finance Documents to which it is party and the terms and conditions
                hereof
                and thereof and authorising a named person or persons to sign the
                Finance
                Documents and any documents to be delivered by such Obligor pursuant
                thereto; and

            

    

     

    
      	
              (c)

            	
              a
                certificate of an Authorised Signatory of such Obligor setting out
                the
                names and signatures of the persons authorised to sign, on behalf
                of such
                Obligor, the Finance Documents to which it is party and any documents
                to
                be delivered by such Obligor pursuant
                thereto.

            

    

     

    
      	
              2.

            	
              The
                following opinions, each in form satisfactory to the
                Agent:

            

    

     

    
      	
              (a)

            	
              opinion
                of Freshfields Bruckhaus Deringer, solicitors to the
                Agent;

            

    

     

    
      	
              (b)

            	
              opinion
                of Richard G. McCarty, Esq., General Counsel to XL
                America;

            

    

     

    
      	
              (c)

            	
              opinion
                of Conyers, Dill & Pearman, special Bermuda counsel to XL Insurance
                and XL Re; and

            

    

     

    
      	
              (d)

            	
              opinion
                of Appleby, special Cayman Islands counsel to XL
                Capital.

            

    

     

    
      	
              3.

            	
              Evidence
                satisfactory to the Agent that:

            

    

     

    
      	
              (a)

            	
              the
                Process Agent has accepted its
                appointment;

            

    

     

    
      	
              (b)

            	
              the
                Agent’s “know your customer” requirements in relation to the Facility have
                been complied with; and

            

    

     

    
      	
              (c)

            	
              Lloyd’s
                will (i) with reference to Clause 2.7, return all Original Letters
                of
                Credit upon the initial issue of any Letters of Credit hereunder;
                (ii)
                with reference to Clauses 4.4 and 4.5, accept Old Letter of Credit
                Releases upon the issue of any corresponding New Letters of Credit
                or
                Reduced Letters of Credit and (iii) with reference to the proviso
                in
                Clause 26.3, accept deeds of substitution to effect any Issuing Lender
                Transfers.

            

    

     

    
      	
              4.

            	
              The
                Agent being satisfied that all fees payable pursuant to the Fee Letter
                have been paid.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    SCHEDULE
      6

     

    

     

    UTILISATION
      REQUEST

     

    From:                      XL
      Capital Ltd

     

    To:           Citibank
      International plc

     

    Dated:

     

    Dear
      Sirs,

     

    We
      refer
      to the £450,000,000 letter of credit agreement (the Facility
      Agreement) dated 14 November 2007 and made between inter
      alia, XL Capital Ltd as account party, Citibank International plc as agent
      and
      the financial institutions named therein as Lenders.  Terms defined in
      the Credit Agreement shall have the same meaning in this notice.  This
      notice is irrevocable.

     

    We
      hereby
      give you notice that, pursuant to the Credit Agreement we wish the Lenders
      to
      issue the following Letters of Credit:

     

    
      	
              Amount

            	
              Commencement
                Date

            	
              Beneficiary

            	
              Applicant

            
	
              £

            	 	
              Society
                of Lloyd’s

            	 
	
              £

            	 	
              Society
                of Lloyd’s

            	 
	
              £

            	 	
              Society
                of Lloyd’s

            	 
	
              £

            	 	
              Society
                of Lloyd’s

            	 
	
              £

            	 	
              Society
                of Lloyd’s

            	 
	
              £

            	 	
              Society
                of Lloyd’s

            	 

    

    Utilisation
      Date:                                [                 ].

     

    We
      confirm that, at the date hereof, the Representations are true in all material
      respects and no Default is continuing.

     

    The
      Letters of Credit should be issued in the form attached and delivered to the
      recipient at [address of recipient].  The purpose of their
      issue is to support Funds at Lloyd’s in respect of the Applicants.

     

    Yours
      faithfully

     

    .............................

     

    Authorised
      Signatory

     

    for
      and
      on behalf of

    XL
      CAPITAL LTD

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    SCHEDULE
      7

     

    FORM
      OF LETTER OF CREDIT

    

     

    Letter
      of Credit to be issued by the Agent on behalf of the Banks

     

    
      	
              To:

            	
              The
                Society and the Council of Lloyd’s

              
                c/o
                  General Manager, Market Services

              

              
                Fidentia
                  House, Chatham,

              

              
                Maritime
                  Chatham, Kent ME4 4TU

              

               

            

    

    Dated:1

     

    Dear
      Sirs

     

    Irrevocable
      Standby Letter of Credit No. [     
     ]

     

    Re:
      [name of corporate member of Lloyd’s] (the
Applicant)

     

    This
      Clean Irrevocable Standby Letter of Credit (the
Credit) is issued by the banks whose names are set out
      in Appendix 1 hereto (the Issuing Banks, and each
      an Issuing Bank) in favour of the Society of Lloyd’s
      (Lloyd’s) on the following terms:

     

    
      	
              1.

            	
              Subject
                to the terms hereof, the Issuing Banks shall make payments within
                two
                business days of demand on Citibank International plc (the
                Agent) in accordance with paragraph 4
                below.

            

    

     

    
      	
              2.

            	
              Upon
                a demand being made by Lloyd’s pursuant to paragraph 4 below each Issuing
                Bank shall pay that proportion of the amount demanded which is equal
                to
                the proportion which its Commitment set out in Appendix 1 hereto
                bears to the aggregate Commitments of all the Issuing Banks set out
                in
                Appendix 1 hereto, PROVIDEDTHAT the
                obligations of the Issuing Banks under this Credit shall be several
                and no
                Issuing Bank shall be required to pay an amount exceeding its Commitment
                set out in Appendix 1 hereto and the Issuing Banks shall not be
                obliged to make payments hereunder in aggregate exceeding a maximum
                amount
                of [amount in approved currency].  Any payment by an
                Issuing Bank hereunder shall be made in [approved currency] to
                Lloyd’s account specified in the demand made by Lloyd’s pursuant to
                paragraph 4 below. ́

            

    

     

    
      	
              3.

            	
              This
                Credit is effective from
                [                             ]
                (the Commencement Date) and will expire on the
                Final Expiration Date. This Credit shall remain in force until we
                give you
                not less than four years’ notice in writing terminating the same on the
                fourth anniversary of the Commencement Date or on any date subsequent
                thereto as specified in such notice (the Final Expiration
                Date), our notice to be sent by registered mail for the
                attention of the General Manager, Members’ Financial Services, at the
                above address.

            

    

     

    
      	
              4.

            	
              Subject
                to paragraph 3 above, the Issuing Banks shall pay to Lloyd’s under this
                Credit upon presentation of a demand by Lloyd’s on Citibank International
                plc at 5th Floor,
                Citigroup Centre, Canada Square, Canary Wharf, London, E14 5LB marked
                for
                the attention of Alisdair Watson, Loans Agency in the form set out
                in
                Appendix 2 hereto the amount specified therein (which amount shall
                not,
                when aggregated with all other amounts paid by the Issuing Banks
                to
                Lloyd’s under this Credit, exceed the maximum amount referred to in
                paragraph 2 above).

            

    

     

    
      	
              5.

            	
              The
                Agent has signed this Credit as agent for disclosed principals and
                accordingly shall be under no obligation to Lloyd’s hereunder other than
                in its capacity as an Issuing Bank.

            

    

     

    
      	
              6.

            	
              All
                charges are for the Applicant’s
                account.

            

    

     

    

      

    

      
      1  Date
        of Letter of
        Credit

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
              7.

            	
              Subject
                to any contrary indication herein, this Credit is subject to the
                International Standby Practices – ISP98 (1998 publication – International
                Chamber of Commerce Publication No.
                590).

            

    

     

    
      	
              8.

            	
              This
                Credit shall be governed by and interpreted in accordance with English
                law
                and the Issuing Banks hereby irrevocably submit to the jurisdiction
                of the
                High Court of Justice in England.

            

    

     

    
      	
              9.

            	
              Each
                of the Issuing Banks engages with Lloyd’s that demands made under and in
                compliance with the terms of this Credit shall be duly honored on
                presentation.

            

    

     

    Yours
      faithfully

     

    CITIBANK
      INTERNATIONAL plc

     

    for
      and
      on behalf of

     

    [Names
      of all Issuing Banks including Agent]

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Appendix
      1

    Issuing
      Banks’ Commitments

    

    Name
      and
      Address of Issuing
      Bank                                                                Commitment

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Appendix
      2

     

    Form
      of Demand (Pounds Sterling)

     

    [on
      Lloyd’s letterhead]

     

    Dear
      Sir/Madam

     

    THE
      SOCIETY OF LLOYD’S

     

    TRUSTEE
      OF

     

    LETTER
      OF CREDIT NO.

     

    With
      reference to the above, we enclose for your attention a Bill of Exchange,
      together with the respective Letter of Credit.   Payment should
      be made by way of CHAPS.  The account details are as
      follows:

     

    
      	
              National
                Westminster Bank Plc

               

            	
              Sort
                Code 60-00-01

            
	
              City
                of London Office

              P.O.
                Box 12258

              1
                Princes Street

              London
                EC2R 8AP

            	
              Account
                13637444

            

    

     

    Please
      quote Member Code:

     

     

    Yours
      faithfully

     

     

    for
      Manager

    Members’
      Funds Department

    Members’
      Services Unit

     

     

    
      By:  ___________________

             
Name:

             
Title:

    

     

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Your
      ref:

     

    Our
      ref:                      MEM/   /   /   /C911f

     

    Extn:

     

    BILL
      OF EXCHANGE

     

    The
      Society of Lloyd’s

     

    Trustee
      of

     

    Letter
      of
      Credit No.

     

    Please
      pay in accordance with the terms of the Letter of Credit to our order the amount
      of £_____ _____ .

     

    For
      and
      on behalf of

     

    Authorised
      Signatory

    Members’
      Funds Department

    
      	
              To:

            	
              Citibank
                International plc

              as
                Agent

            

    

     

     

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

    SCHEDULE
      8

     

    

     

    FORM
      OF TRANSFER CERTIFICATE

     

    
      	
              To:

            	
              Citibank
                International plc

              
                as
                  agent for and on behalf of itself and the other Finance Parties
                  (as
                  defined in the Facility Agreement referred to
                  below)

              

            

    

     

    TRANSFER CERTIFICATE

     

    relating
      to a facility agreement (the Facility Agreement) dated
      14 November 2007 and made between, inter alia, XL Capital Ltd and the Guarantors
      and the Lenders named therein.  Terms defined in the Facility
      Agreement have the same meanings herein.

     

    
      	
              1.

            	
              [Transferor
                Bank] (the Transferor):

            

    

     

    
      	
              (a)

            	
              confirms
                that to the extent that details appear in the Schedule hereto against,
                as
                the case may be, the heading Transferor’s Commitment
                and/or Transferor’s L/C Participation, such details
                accurately summarise, as the case may be, its participation in the
                Facility (as defined in the Facility Agreement);
                and

            

    

     

    
      	
              (b)

            	
              requests
                [Transferee Bank] (the Transferee) to accept and
                procure the transfer to the Transferee of the portion specified in
                the
                Schedule of, as the case may be, its participation in the Facility
                by
                counter-signing and delivering this Transfer Certificate to the Agent
                at
                its address for the service of notices specified in the Facility
                Agreement.

            

    

     

    
      	
              2.

            	
              The
                Transferee hereby requests the Agent to accept this Transfer Certificate
                as being delivered to the Agent pursuant to and for the purposes
                of
                Clause 26.4 of the Facility Agreement so as to take effect in
                accordance with the terms thereof.

            

    

     

    
      	
              3.

            	
              The
                Facility Office and address for notices of the Transferee for the
                purposes
                of the Finance Documents are set out in the
                Schedule.

            

    

     

    
      	
              4.

            	
              The
                Transferor and the Transferee acknowledge and agree that
                Clauses 26.3(c) to 26.3(e) apply to this Transfer Certificate as if
                set out in full herein, mutatis
                mutandis.

            

    

     

    
      	
              5.

            	
              The
                Transferee hereby undertakes with the Transferor and each of the
                other
                parties to the Facility Agreement that it will perform in accordance
                with
                their terms all those obligations which by the terms of the Facility
                Agreement will be assumed by it after delivery of this Transfer
                Certificate to the Agent and satisfaction of the conditions (if any)
                subject to which this Transfer Certificate is expressed to take
                effect.

            

    

     

    
      	
              6.

            	
              This
                Transfer Certificate and the rights and obligations of the parties
                hereunder shall be governed by and construed in accordance with English
                law.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    THE
      SCHEDULE

     

    
      	
               

            	
              Transfer
                Date:

            

    

     

    
      	
              Transferor’s
                Commitment

            	
              Portion
                transferred

            

    

     

    
      	
              Letters
                of Credit

            	
              Letters
                of Credit under which Lender is Issuing
                Lender

            

    

     

    
      	
              Utilisation
                Date, LC Exposure and Final

              
                Expiration
                  Date (if applicable) under

                
                  each
                    Letter of Credit

                

                 

              

            	
              Portion
                transferred

            

    

    
      	
               

            	
               

            

    

    
      	
               

            	
               

            

    

     

    
      	
              [Transferor]

            	
              [Transferee]

            

    

     

    
      	
              By:

            	
              By:

            

    

     

    
      	
              Date:

            	
              Date:

            

    

     

    
      	
               

            	
              [Transferee]

            

    

     

    
      	
              Facility
                Office

            	
              Address(es)
                for notices

            

    

     

    
      	
              [

            	
              [

            

    

     

    

     

    
      	
                                                                          ]

            	
                                                                                             ]

            

    

     

    
      	
               

            	
              Telex
                no:

            	
              [_____
                _____]

            

    

     

    
      	
               

            	
              Contact
                for credit and documentation:

            

    

     

    
      	
               

            	
              Contact
                for administration:

            

    

     

    Citibank
      International plc

    as
      agent
      for and on behalf of itself

    and
      the
      other Finance Parties

     

    By:

     

    Date:

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

    SCHEDULE
      9

     

    

     

    FORM
      OF CHARGE AGREEMENT

     

    A
      DEED OF CHARGE made on [_____ _____]

     

    
      	
              (1)

            	
              XL
                CAPITAL LTD, a limited liability company incorporated under the
                laws of the Cayman Islands with its registered office at PO Box 1350
                GT,
                Clifton House, Fort Street, Grand Cayman, Cayman Islands (the
                Chargor);
                and

            

    

     

    
      	
              (2)

            	
              CITIBANK
                INTERNATIONAL PLC, of Citigroup Centre, 5th floor - CGC2, 33,
                Canada Square, London, E14 5LB as assignee and security trustee for
                the
                Secured Parties (the Security
                Trustee).

            

    

     

    It
      is agreed as follows:

     

    
      	
              1.

            	
              INTERPRETATION

            

    

     

    Definitions

     

    1.1           In
      this Deed: (a) words and expressions defined in the Facility Agreement shall
      bear the same respective meanings; and (b) the following words and expressions
      have the meanings respectively shown opposite below, in each case unless the
      context otherwise requires:

     

    Bank
      means [_____ _____ _____], being a bank in London at which the Deposit is
      held;

     

    Charged
      Account means a separate Sterling account in the name of the
      Chargor with the Bank, entitled
      [“                  ”]
      (account number [_____]) payments to which may be made by making the following
      payment instructions:

     

    [_____
      _____ _____]

     

    and
      into
      which the Deposit is credited, or such other account as the Security Trustee
      may
      from time to time notify in writing to the Chargor;

     

    Deposit
      means all sums from time to time standing to the credit of the Charged Account
      in any currency together with all interest credited thereto;

     

    Facility
      Agreement means the letter of credit and reimbursement agreement
      dated 14 November 2007 between, inter alios, the Lenders, the Security
      Trustee and the Chargor;

     

    Secured
      Obligations means all moneys, liabilities and obligations which
      are now or at any time hereafter may be due, owing or payable by the Chargor
      to
      the Secured Parties in any currency, actually or contingently, solely or jointly
      and/or severally with another or others, as principal or surety, on any account
      whatsoever pursuant to the Facility Agreement, this Deed or any other Finance
      Document, or as a consequence of any Event of Default or repudiation by the
      Chargor (or by any liquidator, receiver, administrative receiver, administrator
      or any similar officer of the Chargor) of any of its obligations under the
      Facility Agreement, this Deed or any other Finance Document;

     

    Secured
      Parties means all and each of the Security Trustee, the Facility
      Agent, the Lenders and each of their respective successors and permitted
      transferees and assignees and Secured Party means any
      of them;

     

    Construction

     

    1.2           In
      this Deed, except where the context otherwise requires:

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (a)           references
      to the Security Trustee and to the Chargor include reference to the persons
      deriving title under or through them respectively and to their respective
      successors in title and assigns;

     

    
      	
              (b)

            	
              references
                to any deed, instrument, account (including the Charged Account),
                certificate, agreement or contract (including this Deed) or a provision
                thereof shall be construed as a reference to that deed, instrument,
                account, certificate, agreement or contract or a provision as from
                time to
                time varied, novated, amended, supplemented or replaced;
                and

            

    

     

    
      	
              (c)

            	
              references
                to any statute or other legislative provision shall include any statutory
                or legislative modification or re-enactment thereof, or any substitution
                therefor.

            

    

     

    Headings

     

    1.3           The
      headings in this Deed are inserted for convenience only and shall not affect
      its
      interpretation.

     

    Deed

     

    1.4           It
      is intended that this Deed take effect as a deed notwithstanding the Security
      Trustee may have executed it under hand only.

     

    2.           OPERATION
      OF CHARGED ACCOUNT

     

    2.1           The
      Chargor shall give notice to the Bank in the form of Appendix 1 upon the
      date of execution of this Deed.

     

    2.2           The
      Chargor shall not request any repayment of the Deposit without the consent
      of
      the Security Trustee.

     

    2.3           The
      Security Trustee may at any time instruct the Bank to pay all or part of the
      Deposit to the Agent on account of amounts then due and payable (whether by
      way
      of acceleration, demand or otherwise) under the Facility Agreement.

     

    2.4           Unless
      an Event of Default is continuing, at the request of the Chargor the Security
      Trustee will instruct the Bank to pay to the Chargor any amount standing to
      the
      credit of the Account which exceeds the amount required to be so credited under
      the Facility Agreement at that time.

     

    3.           CHARGE

     

    3.1           The
      Chargor with full title guarantee hereby charges by way of first fixed charge
      in
      favour of the Secured Parties all its right, title and interest in and to the
      Deposit (and all and any rights and benefits accruing to or arising in
      connection therewith) as a continuing security for the payment and discharge
      of
      the Secured Obligations.

     

    3.2           If
      at any time the Secured Obligations shall have been paid and discharged in
      full
      and the Chargor shall be under no commitment, obligation or liability of any
      kind (present or future, actual or contingent) in relation to the Finance
      Documents, the Security Trustee will at the request and cost of the Chargor
      discharge the security hereby created.

     

    4.           ENFORCEMENT

     

    4.1           The
      security created under Clause 3 shall become enforceable immediately following
      an Event of Default in relation to all and any part of the Secured Obligations
      and, at any time thereafter, the Security Trustee may call for payment to it
      of
      the Deposit and thereafter apply all and any part of the Deposit together with
      any interest thereon in respect of any period after the security has become
      enforceable towards the discharge of the Secured Obligations in such manner
      as
      it deems fit.

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

    4.2           The
      Security Trustee is hereby irrevocably authorised and empowered to give a valid
      discharge in relation to the Deposit (or any part of it) to the
      Bank.

     

    5.           PRIMARY SECURITY

     

    The
      Deposit shall be deemed to
      constitute primary and not collateral security and the security shall not be
      discharged or impaired by:

     

    
      	
              (a)

            	
              the
                dealing with, existence or validity of any other security taken by
                the
                Security Trustee in relation to the Finance Documents or the Secured
                Obligations or any enforcement of or failure to take, perfect or
                enforce
                any such security;

            

    

     

    
      	
              (b)

            	
              any
                amendment to or variation of the Finance Documents or any security
                relating to the Finance Documents or the Secured
                Obligations;

            

    

     

    
      	
              (c)

            	
              any
                release of, or granting of time or any other indulgence to the Chargor
                or
                any third party; or

            

    

     

    
      	
              (d)

            	
              any
                other act, event or omission which would or might but for this Clause
                operate to impair or discharge the security constituted by, or the
                Chargor’s liability under, this Deed including any act, omission or thing
                which would or might afford an equitable defence to a
                security.

            

    

     

    6.           OTHER SECURITY

     

    The
      security hereby created is a continuing security notwithstanding any
      intermediate payment or settlement of account for the payment and discharge
      of
      the Secured Obligations and is in addition to and shall neither be merged in,
      nor in any way exclude or prejudice any other Security Interest, right of
      recourse, set off, combination or other right or interest whatsoever which
      the
      Secured Parties may now have or at any time hereafter hold or have (or would
      apart from this Deed hold or have) as regards the Chargor or any other person
      in
      respect of the Secured Obligations and the Secured Parties may at any time
      take,
      give up, deal with, vary, exchange, or abstain from perfecting or enforcing
      any
      other Security Interest without affecting or prejudicing the security hereby
      created.

     

    7.           WARRANTY
      AND COVENANT

     

    Entitlement

     

    7.1           From
      the date of this Deed and until the Secured Obligations have been satisfied
      and
      discharged in full, and the Chargor shall have no further actual or contingent
      liability to the Secured Parties under the Finance Documents, the Chargor
      warrants that:

     

    
      	
              (a)

            	
              it
                is the sole absolute legal and beneficial owner of the amounts from
                time
                to time credited to the Charged Account free from all Liens, trusts,
                assignments and claims; and

            

    

     

    
      	
              (b)

            	
              it
                is the sole absolute legal and beneficial owner of the right to repayment
                of moneys credited to the Charged
                Account.

            

    

     

    Negative Pledge

     

    
      	
              7.2

            	
              (a)
                The Chargor undertakes that it shall not (without the Security Trustee’s
                prior written consent) create, agree to create or permit to subsist
                any
                Lien (however ranking in point of priority) of any nature whatsoever
                (including such as arises by operation of law or any enactment) in,
                over
                or affecting the Deposit or over its right to call for a discharge
                of the
                security hereby constituted nor deal with such right in any
                manner.

            

    

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

    Non-disposal

     

    (b)           The
      Chargor undertakes that it shall not (without the Security Trustee’s prior
      written consent) transfer, assign, convey, declare a trust over or otherwise
      dispose of the Deposit or any part thereof or its right to repayment of the
      Deposit or any part thereof or its right to call for a discharge of the security
      hereby constituted nor deal with such right in any manner.

     

    8.           WAIVER
      AND APPROPRIATION

     

    8.1           The
      Security Trustee may at any time after the security created hereunder has become
      enforceable without further notice and without any right of redemption
      appropriate the Deposit or any part thereof in such manner as the Security
      Trustee may in its absolute discretion think fit in or towards the reduction
      of
      the Secured Obligations.

     

    8.2           If
      any appropriation of the Deposit (or any part thereof) takes place hereunder
      the
      Chargor hereby expressly waives all or any formalities prescribed by law in
      relation to any such appropriation.

     

    9.           INTEREST

     

    Interest
      on the Deposit shall accrue at such rates as may be agreed from time to time
      between the Bank and the Chargor.  Interest which has accrued on the
      Deposit shall be credited to the Charged Account at such times as shall be
      agreed by the parties.

     

    10.           FURTHER
      PROVISIONS

     

    Expenses
      and Indemnity:

     

    
      	
              10.1

            	
              (a)
                The Chargor shall on demand pay to or reimburse the Security Trustee
                (on
                the basis of a full indemnity on an after tax basis) the amount of
                all
                commissions, reasonable costs (including legal costs), charges and
                expenses incurred by the Security Trustee in connection with the
                preservation, enforcement or the attempted preservation or enforcement
                of
                any of the Secured Parties’ rights under this Deed whether incurred as a
                result of any act or omission by, or proceedings involving, the
                Chargor.

            

    

     

    
      	
              (b)

            	
              The
                Chargor shall on demand fully indemnify the Security Trustee (on
                an
                after-tax basis) against all losses, actions, claims, reasonable
                costs
                (including legal costs), expenses, proceedings, liabilities and
                expenditure which the Security Trustee may suffer, pay or incur in
                connection with any payment or discharge in respect of the Secured
                Obligations (and which are made by the Chargor) being impeached or
                declared void for any reason
                whatsoever.

            

    

     

    
      	
              (c)

            	
              Where,
                pursuant to Clauses 10.1(a) or (b) above, a sum is paid to the
                Security Trustee the Chargor shall, in addition, pay to the Security
                Trustee in respect of value added
                tax:

            

    

     

    
      	
               

            	
              (i)

            	
              (except
                where the payment falls within (ii) below), such amount as equals
                any
                valued added tax charged to the Security Trustee in respect of the
                matter
                which gives rise to the payment and which the Security Trustee certifies
                is not recoverable by it by repayment or credit (such certificate
                to be
                conclusive in the absence of manifest error);
                and

            

    

     

    
      	
               

            	
              (ii)

            	
              on
                any reimbursement of or indemnification for any commissions, costs,
                charges, expenses or other items incurred by the Security Trustee
                as agent
                for the Chargor, such amount as equals the amount included in the
                commissions, costs, charges, expenses or other items in respect of
                value
                added tax (and in such a case the Security Trustee shall provide
                the
                Chargor with an appropriate tax invoice in respect of such item,
                naming
                the Chargor as recipient of the relevant
                supply).

            

    

     

    Further
      Assurances

     

    10.2           The
      Chargor shall on demand execute any document and do any other act or thing
      (in
      either case at the expense of the Chargor) which the Security Trustee may
      reasonably specify for protecting, preserving or perfecting any security created
      or intended to be created by this Deed or for facilitating the realisation
      thereof or otherwise e

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

    forcing
      the same or exercising any of the powers, rights and discretions of the Security
      Trustee under this Deed, including the execution of all releases, transfers,
      assignments and other documents and the giving of all notices, orders,
      instructions and directions which the Security Trustee may request.

     

    Rights
      cumulative

     

    10.3           The
      rights and powers which this Deed confers on the Secured Parties are cumulative,
      may be exercised as often as it considers appropriate and are in addition to
      its
      rights and powers under the general law, and the rights of the Secured Parties
      (whether arising under this Deed or under the general law) shall not be capable
      of being waived or varied otherwise than by express waiver or variation in
      writing; and, in particular, any failure to exercise or any delay in exercising
      any such rights shall not operate as a variation or waiver of that or any other
      such right; any defective or partial exercise of such right shall not preclude
      any other or further exercise of that or any other such right; and no act or
      course of conduct or negotiation on their part or on their behalf shall in
      any
      way preclude them from exercising any such right or constitute a suspension
      or
      variation of any such right.

     

    Illegality,
      etc

     

    10.4           If
      any one of the provisions of this Deed is or becomes invalid, illegal or
      unenforceable in any respect, the validity, legality or enforceability of the
      remaining provisions of this Deed shall not in any way be affected or impaired
      thereby.

     

    Duty
      to Account

     

    10.5           Save
      as may otherwise be agreed in writing between the Security Trustee and the
      Chargor, the Security Trustee shall not, prior to discharging the security
      hereby constituted, have any duty to account to the Chargor in respect of the
      Deposit or any part thereof.

     

    Evidence
      of Indebtedness

     

    10.6           In
      any proceedings relating to this Deed, any determination or notification by
      the
      Security Trustee or any other Finance Party as to any amount of the Secured
      Obligations or as to any amount due to the Secured Parties under this Deed
      shall, in the absence of manifest error, be conclusive evidence as to that
      matter.

     

    Entire
      Agreement

     

    10.7           This
      Deed constitutes the entire agreement between the parties hereto in relation
      to
      the Deposit and supersedes all previous proposals, arrangements, agreements
      and
      other written and oral communications in relation thereto.

     

    Exclusion
      of Restrictions

     

    10.8           Sections
      93 and 103 of the Law of Property Act 1925 shall not apply to this
      Deed.

     

    Ruling Off

     

    10.9           If
      the Security Trustee receives notice of any subsequent Security Interest
      affecting the Deposit:

     

    
      	
              (a)

            	
              the
                Security Trustee may open a new account or accounts with the Chargor
                and
                if the Security Trustee does not open a new account, it shall nevertheless
                be treated as if it had done so at the time when it received notice;
                and

            

    

     

    
      	
              (b)

            	
              all
                payments made by the Chargor to the Security Trustee after the Security
                Trustee receives such notice shall be credited or be treated as having
                been credited to the new account and in no circumstances whatsoever
                shall
                operate to reduce the amount due from the Chargor to the Secured
                Parties
                at the time when it received the
                notice.

            

    

     

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

    
      	
               

            	
              Successors
                in Title

            

    

     

    
      10.10
        (a)This Deed shall be binding upon and inure to the benefit of each of the
        parties hereto and their successors and assigns.

    

     

    
      	
              (b)

            	
              The
                Chargor shall not be entitled to assign or transfer any of its rights,
                benefits or obligations hereunder without the prior written consent
                of the
                Security Trustee.

            

    

     

    
      	
              (c)

            	
              The
                Security Trustee may assign or transfer all or any part of its rights,
                benefits or obligations under this Deed to any person to whom it
                assigns
                and/or transfers its rights, benefits or obligations in accordance
                with
                the provisions of the Facility Agreement.  Where the Security
                Trustee assigns or transfers its obligations or any part thereof,
                the
                Chargor shall execute such documents as the Security Trustee may
                specify
                to release the Security Trustee to the extent of the transfer or
                with a
                view to perfecting such document or transfer, or where necessary,
                shall
                execute further security documentation in favour of the assignee
                or
                transferee in like form to this
                Deed.

            

    

     

    11.           NOTICES
      AND COMMUNICATIONS

     

    The
      provisions relating to notices are set forth in Clause 22 of the Facility
      Agreement.

     

    12.           GOVERNING
      LAW AND JURISDICTION

     

    12.1           This
      Deed shall be governed by, and interpreted and construed in accordance with,
      the
      laws of England.

     

    Jurisdiction

     

    
      	
              12.2

            	
              (a)
                All the parties agree that the courts of England are, subject to
                Clause 12.2 (a) and (b) below, to have jurisdiction to settle any
                disputes which may arise in connection with the creation, validity,
                effect, interpretation or performance of, or the legal relationships
                established by, this Agreement (including, without limitation, claims
                for
                set-off or counterclaim) or otherwise arising in connection with
                this
                Agreement and for such purposes irrevocably submit to the jurisdiction
                of
                the English courts;

            

    

     

    
      	
              (b)

            	
              notwithstanding
                the agreement in paragraph 12.2(a) above, each of the Secured Parties
                shall retain the right to bring proceedings in any other court which
                has
                jurisdiction whether by virtue of the Convention on Jurisdiction
                and the
                Enforcement of Judgments signed on 27 September 1968 (as from time to
                time amended and extended) or by virtue of the Convention on Jurisdiction
                and the Enforcement of Judgments signed on 16 September 1988 (from
                time to time amended and extended) or Council Regulations (EC) No
                44/2001
                of 22 December 2000 on jurisdiction and the enforcement of judgements
                in
                civil and commercial matters which came into force on 1 March
                2002;

            

    

     

    
      	
              (c)

            	
              with
                respect to the courts agreed in paragraphs 12.2(a) and 12.2(b) above,
                each
                of the parties irrevocably waives any objections on the ground of
                venue or
                forum non conveniens or any similar
                ground;

            

    

     

    
      	
              (d)

            	
              each
                of the parties hereto irrevocably agrees that a judgment or order
                of any
                court referred to in this Clause in connection with this Deed is
                conclusive and binding on it and may be enforced against it in the
                courts
                of any other jurisdiction; and

            

    

     

    
      	
              (e)

            	
              each
                of the parties hereto irrevocably consents to service of process
                by mail
                or in any other manner permitted by the relevant
                law.

            

    

     

    Agent
      for Service of Process

     

    12.3           The
      Chargor shall at all times maintain an agent for service of process and any
      other documents in proceedings in England or any other proceedings in connection
      with this Deed.  Such agent shall be XL Services UK Limited, XL House,
      70 Gracechurch Street, London EC3V 0XL (Attn: Company Secretary) and any writ,
      judgment or

     

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

    other
      notice of legal process shall be sufficiently served on the Chargor if delivered
      to such agent marked for the attention of the Company Secretary at its address
      for the time being.  The Chargor undertakes not to revoke the
      authority of the above agent without promptly appointing a successor and
      notifying the Security Trustee thereof.

     

    13.           CONTRACTS
      (RIGHTS OF THIRD PARTIES) ACT 1999

     

    A
      person
      who is not a party to this Deed shall have no right under the Contracts (Rights
      of Third Parties) Act 1999 to enforce any of its terms.

     

    
      
        
        

      

      
        -7-

        
          

        

      

      
        
        

      

    

    Appendix
      1

     

    Form
      of Notice to Bank

     

    To:                      [Bank]

     

    And
      to:                      Citibank
      International plc (the Security Trustee)

     

    Dear
      Sirs

     

    Re:
      Account [_____ _____] (the Account)

     

    We
      hereby
      give you notice that pursuant to a Deed of Charge dated [_____ _____], a copy
      of
      which is attached, we have charged all of our right, title and interest in
      and
      to the Account to the Security Trustee.

     

    Please
      execute and return to the Security Trustee the attached acknowledgement attached
      as Schedule A to this notice.

     

    This
      notice shall be governed by English law.

     

    Yours
      truly,

     

    XL
      Capital Ltd

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Schedule
      A

     

    Form
      of Acknowledgement of Bank

     

    
      	
              To:

            	
              XL
                Capital Ltd
P O Box 1350 GT

              
                Clifton
                  House

              

              
                Fort
                  Street

              

              
                Grand
                  Cayman

              

              
                Cayman
                  Islands

              

            

    

    
And
      to:                      Citibank
      International plc (the Security Trustee)

     

    Dear
      Sirs

     

    Re:
      Account [_____ _____] (the Account)

     

    We
      acknowledge receipt of your notice dated [_____ _____] and the deed of charge
      to
      which it refers (the Deed of Charge).

     

    We
      hereby
      confirm that:

     

    
      	
              (a)

            	
              we
                have received no notice of any other charge, mortgage, pledge, lien,
                assignment or security interest in respect of the Account, other
                than the
                security interest described in the Deed of
                Charge;

            

    

     

    
      	
              (b)

            	
              we
                hereby waive any rights of set off or combination of accounts we
                may now
                or at any time in the future have in respect of the
                Account;

            

    

     

    
      	
              (c)

            	
              we
                undertake not to repay to the Chargor any amount standing to the
                credit of
                the Account except on the instructions of the Security
                Trustee;

            

    

     

    
      	
              (d)

            	
              we
                shall deliver to the Security Trustee and the Chargor, on written
                request,
                an up-to-date statement of the amount standing to the credit of the
                Account; and

            

    

     

    
      	
              (e)

            	
              unless
                the Security Trustee otherwise directs, we shall comply with the
                instructions of the Security Trustee with respect to the Account,
                and
                payments to and from the Account and shall not make any payments
                from the
                Account without the consent of the Security
                Trustee.

            

    

     

    This
      acknowledgment shall be governed by English law.

     

    Yours
      truly,

     

    [Bank]

     

    DULY
      DELIVERED AS A DEED by the Chargor on the date inserted
      above.

     

    EXECUTED
      as a
DEED                             )

    for
      and
      on behalf
      of                                   )

    XL
      CAPITAL
      LTD                                    )

     

    

     

    In
      the
      presence
      of:                                    )

    SIGNED                                                      )

    for
      and
      on behalf
      of                                  )

     

    CITIBANK
      INTERNATIONAL PLC    )

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    In
      witness whereof, XL CAPITAL LTD has caused this Agreement to be
      duly executed by an authorised officer on the day and year first above
      written.

     

    Account
      Party

     

    SIGNED

    for
      and
      on behalf of XL CAPITAL LTD

     

    By:           /s/
      FIONA LUCK

     

    Title:           EVP

     

    Guarantors

     

    SIGNED

     

    for
      and
      on behalf of XL CAPITAL LTD

     

    By:           /s/
      FIONA LUCK

     

    Title:           EVP

     

    SIGNED
      for and on behalf of X.L. AMERICA, INC.

     

    By:           /s/
      GABRIEL G. CARINO, VICE PRESIDENT

     

    Title:       
      VICE PRESIDENT

     

    SIGNED
      for and on behalf of XL INSURANCE (BERMUDA) LTD

     

    By:           /s/
      DONALD BAKER

     

    Title:       
      EVP

     

    SIGNED
      for and on behalf of XL RE LTD

     

    By:           /s/
      DERRICK A. IRBY

     

    Title:        SVP
      & CHIEF FINANCIAL OFFICER

     

    Agent

     

    SIGNED
      for and on behalf of CITIBANK INTERNATIONAL
      PLC

     

    By:                      /s/
      PAUL GIBBS

     

    Address:       
         Citigroup Centre

    33
      Canada
      Square

    Canary
      Wharf

    London
      E14 5LB

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

    Fax:                      +44
      20 8636 3824

    Tel:                      +44
      20 7500 4246

    Attention:           Loans
      Agency

     

    Arrangers

     

    SIGNED
      for and on behalf of CITIGROUP GLOBAL MARKETS
      LIMITED

     

    By:                      /s/
      PAUL GIBBS

     

    Address:           
      Citigroup Centre

    33
      Canada
      Square

    Canary
      Wharf

    London
      E14 5LB

     

    Fax:                     
      +44
      20
      7986 8278

    Tel:                      +44
      20 7986 7160

    Attention:           Paul
      Gibbs

     

    SIGNED
      for and on behalf of LLOYDS TSB BANK PLC

     

    By:                      /s/
      W S THOMAS

     

    
      	
              Address:

            	
              25
                Gresham Street

            

    

    
      	
               

            	
              London  EC2V
                7HN

            

    

     

    Fax:                      +44
      (0) 207 661 4860

    Attention:           Richard
      Askey

     

    SIGNED
      for and on behalf of THE ROYAL BANK OF SCOTLAND
      PLC

     

    By:                      /s/
      ALAN HAMES

    
      	
              Address:

            	
              135
                Bishopsgate

              London, EC2M
                3UR

            

    

     

    Fax:                      +44
      (0)207 085 2269

    Attention:           Alan
      Hames

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

    Security
      Trustee

     

    SIGNED
      for and on behalf of CITIBANK INTERNATIONAL PLC

     

    By:                      /s/
      PAUL GIBBS

     

    Address        Citigroup
      Centre

    33
      Canada
      Square

    Canary
      Wharf

    London
      E14 5LB

     

    Fax:                    
      +44 20 8636 3824

    Tel:                     +44
      20 7500 4246

    Attention:          Loans
      Agency

     

    Lenders

     

    SIGNED
      for and on behalf of

     

    BAYERISCHE
      HYPO-UND VEREINSBANK AG

     

    By:                 
       /s/ STEPHEN R. LUEKER (DIRECTOR)

    /s/
      MICHAEL F. DAVIES (DIRECTOR)

     

    
      	
              Address:

            	
              150
                East 42nd Street, 30th
                Floor

              
                New
                  York, NY 10017

              

            

    

     

    Fax:                   +1
      (212) 672-5307

    Attention:         Steve
      Lueker, Financial Institutions Group

     

    
      	
              Copy:

            	
              Credit
                Group

              
                150
                  East 42nd
                  Street, 30th
                  Floor

              

              
                New
                  York, NY 10017

              

            

    

     

    Fax:                 
      +1 (212) 672-5898

    Attention:       Michael
      Davis

     

    SIGNED
      for and on behalf of

     

    CALYON

     

    By:                   /s/
      SEBASTIAN ROCCO (MANAGING DIRECTOR)

     

                            
      /s/ WILLIAM DENTON (MANAGING DIRECTOT)

     

    Address:      
        Calyon Building

                            
      1301 Avenue of the Americas

                             
      New York, NY 10019

     

    Fax:                     +1
      (212) 261 3438

    
      Attention:          Charles
        Kornberger

    

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

     

    SIGNED
      for and on behalf of

     

    CITIBANK,
      N.A.

     

    By:                     /s/
      PAUL GIBBS

     

    
      	
              Address:

            	
              Citigroup
                Centre

              
                33
                  Canada Square

              

              
                Canary
                  Wharf

              

              
                London  E14
                  5LB

              

            

    

     

    Fax:                     +44
      (0) 207 942 7512

    Attention:          Loans
      Processing Unit

     

    SIGNED
      for and on behalf of

     

    COMMERZBANK
      AKTIENGESELLSCHAFT,

    NEW
      YORK AND GRAND CAYMAN BRANCHES

     

    By:                      /s/
      JOSEPH J HAYES (VICE PRESIDENT)

     

    By:                      /s/
      WILLIAM M. EARLEY (SENIOR VICE PRESIDENT)

     

    
      	
              Address:

            	
              Two
                World Financial Center

              New York, New York 
                10281-1050

            

    

     

    Fax:                     +1
      (212) 266-7629

    Attention:          Arndt
      Bruns

     

    SIGNED
      for and on behalf of

     

    ING
      BANK N.V., LONDON BRANCH

     

    By:                     N
      J MARCHANT

     

    By:                     /s/
      M E R SHARMAN

     

    
      	
              Address:

            	
              60
                London Wall

              
                London,
                  EC2M 5TQ

              

            

    

     

    Fax:                    +44
      (0)207 767 7507

    Attention:         Nicola
      Haffner

     

    SIGNED
      for and on behalf of

     

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

    LANDESBANK
      HESSEN-THÜRINGEN GIROZENTRALE, LONDON BRANCH

     

    By:                      /s/
      SIMON DE MARIA

     

                                /s/
      JAMES LOWE

     

    Address:           3rd
      Floor, 95 Queen
      Victoria Street

    London,
      EC4V 4HN

     

    Fax:                    +44
      (0)207 334 4534

    Attention:         John
      Blewett

    

      SIGNED
        for and on behalf of

       

      LLOYDS
        TSB BANK PLC

       

      By:                      /s/
        W S THOMAS

       

      
        	
                Address

              	
                :

              	
                25
                  Gresham Street

                London  EC2V
                  7HN

              

      

       

       

      Fax:                    
        +44 (0) 207 661 4860

      Attention:         
        Richard Askey

       

      SIGNED
        for and on behalf of

       

      MIZUHO
        CORPORATE BANK, LTD

       

      By:                      /s/
        HIDEKATSU TAKE (DEPUTY GENERAL MANAGER)

       

      Address:            1251
        Avenue of the Americas

                                 
        New York, N.Y. 10020-1104

                                  USA

       

      Fax:                    
        +1 (212) 282-4488

      Attention:          Li
        Zha / AVP

       

      Copy:                 Robert
        Gallagher / SVP

      Fax:                    
        +1 (212) 282-4488

       

      
        
          
          

        

        
          -6-

          
            

          

        

        
          
          

        

      

      SIGNED
        for and on behalf of

       

      THE
        BANK OF TOKYO-MITSUBISHI UFJ, LTD., NEW YORK BRANCH

       

      By:                     
        /s/ CHIMIE T. PEMBA

       

      Address:           1251
        Avenue of the Americas

                                 
        New York, NY 10020-1104

       

      Attention:         
        Chimie T. Pemba

      Fax:                     +1
        (212) 782-6440

       

      SIGNED
        for and on behalf of

       

      THE
        ROYAL BANK OF SCOTLAND PLC

       

      By:                      /s/
        ALAN HAMES

       

      Address:            135
        Bishopsgate

                                  
        London, EC2M 3UR

       

      Fax:                      +44
        (0)207 085 2269

      Attention:           Alan
        Hames

       

      
        
          
          

        

        
          -7-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00133-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00133-of-00352.parquet"}]]