Document:

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                                                                    Exhibit 10.4

                                WILLOW GROVE BANK

                     NON-EMPLOYEE DIRECTORS' RETIREMENT PLAN

                                (AS AMENDED 2002)

<PAGE>

                                                                    Exhibit 10.4

                                WILLOW GROVE BANK

                     NON-EMPLOYEE DIRECTORS' RETIREMENT PLAN

                                    ARTICLE I

PURPOSE

     The Willow Grove Bank Non-Employee Directors' Retirement Plan (the "Plan")
which was effective as of June 30, 1998 is hereby amended and restated as of
October 22, 2002. The Plan was established in order to provide non-employee
members of the Board of Directors ("Board") of Willow Grove Bank (the "Bank")
with retirement benefits in recognition of their service to the Bank and to
encourage their continued association with the Bank.

                                   ARTICLE II

DEFINITIONS

     Section 2.1     BANK. Willow Grove Bank.

     Section 2.2     PLAN. Willow Grove Bank Non-Employee Directors' Retirement
Plan.

     Section 2.3 EFFECTIVE DATE. The Plan effective date is June 30, 1998.

     Section 2.4 Non-Employee Director. A Director of the Bank who is not an
employee of the Bank or of any Affiliated Corporation.

     Section 2.5 AFFILIATED CORPORATION. A corporation in which the Bank owns
50% or more of the issued and outstanding stock of any class, or a corporation
which owns more than 50% of the issued and outstanding stock of any class of the
Bank.

     Section 2.6 YEARS OF SERVICE. Any year or fraction thereof of service on
the Board by a Non-Employee Director. By way of illustration, a Non-Employee
Director shall have one year of service immediately upon election, two years of
service on the day after the first anniversary of his election, and so forth.

     Section 2.7 PARTICIPANT. A Non-Employee Director shall become a Participant
in the Plan upon completion of six (6) continuous Years of Service as a
Non-Employee Director. For this purpose, Years of Service completed prior to the
Effective Date shall be included in determining a Director's number of years of
service.

     Section 2.8 DIRECTOR'S ANNUAL FEE. The Director's Annual Fee is the monthly
meeting fee paid to the Non-Employee Director for the month immediately
preceding the Non-Employee Director's retirement or termination of service
multiplied by twelve (12).

     Section 2.9 DIRECTOR'S RETIREMENT FEE. The Director's Retirement Fee shall
be the amount computed in accordance with Section 3.2 hereof which shall be
payable annually in accordance with Section 3.3 hereof unless a Participant
makes an election to be paid in a lump sum in accordance with such Section 3.3.

     Section 2.10 DESIGNATED BENEFICIARY. The Designated Beneficiary means the
person or persons designated by a Participant to receive any benefits payable
under the Plan in the event of such Participant's death. Such person or persons
shall be designated in writing on forms provided for this purpose by the Bank
and may be changed from time to time by similar notice to the Bank. In the
absence of a written designation, the beneficiary shall be a Participant's
estate.

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                                                                    Exhibit 10.4

                                   ARTICLE III

BENEFITS

     Section 3.1 VESTING OF BENEFITS. Each Non-Employee Director's rights and
benefits under the Plan shall vest upon retirement or termination of service as
a Director of the Bank in accordance with the following schedule.

                                              Vested Percentage of
                                              Interest in Director's
                     Years of Service         Retirement Fee at Retirement
                     ----------------         ----------------------------

                     6                        20%

                     7                        40%

                     8                        60%

                     9                        80%

                     10                       100%

     Section 3.2 COMPUTATION OF BENEFITS. Benefits shall be determined at the
time a Participant retires as, or otherwise ceases to be, a Director of the
Bank. The annual benefit payable to a Participant, shall be equal to the
Director's Annual Fee multiplied by the Participant's vested percentage as
determined in Section 3.1.

     To the extent that any Non-Employee Director is obligated to pay
self-employment taxes with respect to the benefits provided for under the Plan,
the Bank shall pay the self-employment taxes for each Participant when such
taxes are due. The Bank shall have no obligation to pay any other taxes on
behalf of a Participant, his Designated Beneficiary or his estate.

     Section 3.3 PAYMENT OF BENEFIT. A Participant shall be paid his benefit
pursuant to the Plan in equal quarterly installments for ten (10) years (i.e.,
ten years certain and continuous) beginning with the first calendar quarter
following the date the Participant has ceased being a Director of the Bank. No
benefits shall be payable until a Non-Employee Director ceases to be a Director
of the Bank. A Participant or a Designated Beneficiary may elect to receive the
value of his payments or remaining payments in a lump sum (using a discount rate
equal to 6% rate of interest). Any such election shall be in writing and
delivered to the President of the Bank.

     Section 3.4 DESIGNATED BENEFICIARY BENEFIT. In the event of the death of a
Participant prior to the commencement of payments under Section 3.3 hereof, the
Director's Retirement Fee which the Participant is entitled to pursuant to
Section 3.2 hereof, shall be paid in equal quarterly payments to his Designated
Beneficiary for ten (10) years (i.e., ten years certain and continuous)
beginning with the first day of the calendar quarter next following the death of
the Participant. In the event of the death of a Participant subsequent to the
commencement of payments under Section 3.3 hereof, his Designated Beneficiary
shall be paid in equal quarterly payments the remainder of the amount which the
Participant would have received under Section 3.3 hereof, beginning with the
first day of the calendar quarter next following the death of the Participant.
If, upon the death of a Participant, such Participant has failed to name a
Designated Beneficiary or such Designated Beneficiary has predeceased the
Participant, the present value of the payments or remaining payments which would
have been made to the Participant shall be paid to the estate of the Participant
in a lump sum (using a discount rate equal to 6% rate of interest).

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                                                                    Exhibit 10.4

                                   ARTICLE IV

MISCELLANEOUS

     Section 4.1 GENERAL ADMINISTRATIVE POWERS. The Plan shall be administered
by the Bank. Whenever there is an occasion for the exercise of any power or
discretion, such action shall be taken by the Board of Directors or such
committee of the Board of Directors or other person as shall be determined by
the Board of Directors.

     Section 4.2 SUCCESSORS. The Bank agrees to not merge or consolidate with
any other corporation or organization or permit their business activities to be
taken over by any other organization unless and until the succeeding or
continuing corporation or other organization shall expressly assume the rights
and obligations of the Plan as herein set forth. The Bank further agrees to not
cease its business activity or terminate its existence other than as heretofore
set forth without having made adequate provision fulfilling all of its
obligations hereunder.

     Section 4.3 ENTIRE UNDERSTANDING. This Plan sets forth the entire
understanding of the parties with respect to the subject matter hereof and
supersedes any and all prior agreements, arrangements and understanding relating
thereto. To the extent inconsistent with any such prior agreement, arrangement
or understanding, the provisions of this Plan shall control.

     Section 4.4 APPLICABLE LAW. This Plan shall be governed by and controlled
in all respects in accordance with applicable federal law and, to the extent not
preempted by such federal law, in accordance with the laws of the Commonwealth
of Pennsylvania.

     Section 4.5 INVALIDITY. In the event that any provision of this Plan or the
application thereof to any person or circumstances shall be determined by a
court of competent jurisdiction to be invalid or unenforceable to any extent,
the remainder of this Plan, or the application of such provisions to persons or
circumstances other than those as to which it is held invalid or unenforceable,
shall not be affected thereby, and each provision of this Plan shall be valid
and enforced to the maximum extent permitted by law.

     Section 4.6 NON-ALIENATION. No benefit payment payable under this plan,
whether or not in payment status, shall be subject in any manner to
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance or
charge and any attempt to anticipate, alienate, sell, transfer, assign, pledge,
encumber or to charge the same shall be void. No such benefit or interest shall
be liable for or subject to the debts, contracts, liabilities or torts of a
Participant or a Participant's Designated Beneficiary entitled to any benefit or
having any interest. If any Participant or Designated Beneficiary becomes
bankrupt or attempts to anticipate, alienate, sell, transfer, assign, pledge,
encumber or charge any benefit under this Plan, the Bank may, in its discretion,
direct that any benefit to which such Participant or Designated Beneficiary is
entitled be terminated and that all future payments to which such person would
otherwise be entitled, be held and applied for the benefit of such person, his
or her children or other dependents, or any of them, in such manner and in such
proportion as the Bank may deem proper.

     Section 4.7 AMENDMENTS. The Plan may be amended or terminated only by the
vote of two-thirds (2/3) of the Directors then serving on the Board of
Directors. No amendment or termination may affect the rights or benefits to
which retired Directors or Designated Beneficiaries have become entitled to
under the Plan without the consent of such Directors or Designated
Beneficiaries.

     Section 4.8 UNFUNDED BENEFITS. The Plan shall be unfunded. Nothing in this
Plan shall be construed to imply that any specific assets of the Bank have been
set aside to provide for payments under this Plan. Any payments under this Plan
will be made solely from the general assets of the Bank existing at the time
such payments are to be made, and the Participant's rights under the Plan shall
be those of a general creditor of the Bank.

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     Section 4.9 DIRECTOR EMERITUS. The terms of the Plan, as amended, shall be
construed to have been in effect on the date that Director Emeritus J. Ellwood
Kirk retired as a Director of the Bank.

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                                                                    Exhibit 10.4

     IN WITNESS WHEREOF, and as conclusive evidence of the adoption of this Plan
by the Board of Directors of the Bank, the President of the Bank has signed and
executed this Plan on behalf of the Bank as of the 22nd day of October, 2002.

                                WILLOW GROVE BANK

                                By:  /s/ Frederick A.  Marcell Jr.
                                     -----------------------------------
                                     Frederick A. Marcell Jr., President<PAGE>

                                                                   Exhibit 10.72
                                                                   -------------

             2002 COMBINED QUOTA SHARE AND AGGREGATE EXCESS OF LOSS
             ------------------------------------------------------
                              REINSURANCE AGREEMENT
                              ---------------------

ARTICLE                                                                   PAGE
-------                                                                   ----
BUSINESS COVERED                                                            2
COMMENCEMENT AND TERMINATION                                                2
TERRITORY AND INURING REINSURANCE                                           3
EXCLUSIONS                                                                  3
COVERAGES AND AGGREGATE LIMITS                                              4
DEFINITIONS                                                                 5
NET RETAINED LIABILITY                                                      7
SECTION A:  ADVANCE AND ACTUAL CONSIDERATION,
    SECTION B:  ACTUAL CONSIDERATION, ADDITIONAL
    COVERAGES EXPENSE CHARGE                                                8
OFFSET AND SECURITY                                                        10
REPORTS AND LOSS SETTLEMENTS                                               11
FUNDS WITHHELD ACCOUNT AND INTEREST CREDIT                                 12
LIABILITY OF THE REINSURERS AND CURRENCY                                   13
COMMUTATION                                                                14
EXCESS OF ORIGINAL POLICY LIMITS                                           14
EXTRA CONTRACTUAL OBLIGATIONS                                              14
DELAYS, ERRORS AND OMISSION                                                15
ACCESS TO RECORDS                                                          15
ACTUARIAL REVIEW                                                           16
LOSS RESERVE AND ADVANCE PREMIUM FUNDING                                   16
FUNDS WITHHELD TRUST ACCOUNT                                               16
INSOLVENCY                                                                 17
ARBITRATION                                                                18
CHANGES IN ADMINISTRATIVE PRACTICE                                         19
TAXES                                                                      19
SERVICE OF SUIT                                                            19
NO ASSIGNMENT                                                              20
INTERMEDIARY                                                               20

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             2002 COMBINED QUOTA SHARE AND AGGREGATE EXCESS OF LOSS
             ------------------------------------------------------
                              REINSURANCE AGREEMENT
                              ---------------------
                        (hereinafter called the "Treaty")

     THIS AGREEMENT is made and entered into by and between MIIX INSURANCE
COMPANY, a New Jersey corporation (hereinafter called the "Ceding Company") of
the one part, and HANNOVER REINSURANCE (IRELAND) LIMITED/ E + S REINSURANCE
(IRELAND) LIMITED (hereinafter called the "Reinsurers") of the other part.

     In consideration of the mutual covenants hereinafter contained and upon the
terms and conditions hereinbelow set forth, the parties hereto agree as follows:

BUSINESS COVERED
----------------

     This Treaty shall indemnify the Ceding Company with respect to Ultimate Net
Losses which may accrue to the Ceding Company under any and all Policies subject
to the Terms and Conditions of this Treaty.

     As respects all coverages hereon, the Reinsurers shall provide coverage on
a risks attaching basis in respect of all of the Ceding Company's Policies.
Premiums received in advance of the Coverage Period are deemed to be part of
Subject Net Written Premium. Coverage shall in all cases follow the underlying
basis of coverage of the original Policies written by the Ceding Company. For
all purposes, the "Permanent Protection Policies (PPP)" written by the Ceding
Company shall in all cases be deemed to cover on a losses occurring during basis
of underlying coverage. Reinsurers shall be subject to all of the conditions of
the PPP including policy limits and the aggregate limit formula under the
extended reporting coverage therein.

     Reinsurers shall remain liable for all losses covered by this Treaty until
all such losses are paid or this Treaty is commuted.

COMMENCEMENT AND TERMINATION
----------------------------

     This Treaty is effective November 1st, 2001, 12:01 a.m., Eastern Standard
Time, and shall terminate August 1, 2002, 12:01 a.m., Eastern Standard Time.
Unless otherwise mutually agreed, reinsurance hereunder on Business Covered in
force at the effective date of termination shall remain in full force and effect
until expiration, cancellation or next anniversary of such business, whichever
first occurs, but in no event beyond 12 months following the effective date of
termination plus any extension of coverage for extended reporting provided under
the original policies of the Ceding Company.

     Should this Treaty expire while a loss is in progress, the Reinsurers shall
be responsible for the loss in progress in the same manner and to the same
extent they would

                                       2

<PAGE>

have been responsible had the Treaty expired the day following the conclusion of
the loss in progress.

TERRITORY AND INURING REINSURANCE
---------------------------------

         This Treaty will cover Policies written within the United States of
America. All other Reinsurance Agreements that inure to the benefit of this
Treaty shall be deemed in place until all liability of the Reinsurers hereon is
finalized by payment of all losses or commutation.

EXCLUSIONS
----------

     This Treaty shall not apply to and specifically excludes the following:

     A.   Workers' Compensation Insurance.

     B.   All liability of the Ceding Company arising by contract, operation of
          law, or otherwise, from its participation or membership, whether
          voluntary or involuntary, in any insolvency fund. "Insolvency Fund"
          includes any guaranty fund, plan, pool, association, fund or other
          arrangement, however denominated, established or governed, which
          provides for any assessment of or payment or assumption by the Ceding
          Company of part or all of any claim, debt, charge, fee or other
          obligation or an insurer, or its successors or assigns, which has been
          declared by any competent authority to be insolvent, or which is
          otherwise deemed unable to meet any claim, debt, charge, fee or other
          obligation in whole or in part.

     C.   Nuclear risks as defined in the Nuclear Incident Exclusion
          Clause--Liability Reinsurance--USA except for incidents arising from
          Nuclear Medicine attached to and forming part of this Treaty.

     D.   Any business derived from participation in any Pool, Association or
          Syndicate.

     E.   War Risks, in accordance with the North America War Exclusion Clause
          attached hereto.

     F.   Unallocated Loss Adjustment Expenses as described in paragraph D. of
          the DEFINITIONS Article.

     G.   Underlying Provider Stop Loss Policies written by the Ceding Company.

     H.   Financial Guaranty and Insolvency business.

                                       3

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COVERAGES AND AGGREGATE LIMITS
------------------------------

Section A - 75% Quota Share Coverage

     Reinsurers shall indemnify the Ceding Company for 75% (seventy-five
percent) quota share of Ultimate Net Loss arising from covered losses during the
Coverage Period subject to the Section A Aggregate Limit hereon. This quota
share shall be in respect of the Business Covered exposure period related to
Section A Advance and Actual Consideration only.

     This Section A Quota Share Coverage can be converted to Section B Aggregate
Excess of Loss Coverage during the first quarter retroactive to January 1st,
2002. This conversion is at the mutual agreement of the Ceding Company and the
Reinsurers and is subject to the following conditions not being present prior to
the conversion date:

     1.   The Ceding Company's A.M. Best Rating falls below B+; and

     2.   The Ceding Company's Statutory Policyholders' Surplus drops below
          $60,000,000 (sixty million dollars).

If both of these conditions are present during the first quarter, then the
Section A Quota Share Coverage cannot be converted into Section B Aggregate
Excess of Loss Coverage.

     If Section A is not converted to Section B, the Ceding Company shall track
the advance premium by policy to the coverage time afforded by the Direct
Advance Premium under each policy. Section A shall cover the Ceding Company on
the basis of the coverage time of the underlying original Policies afforded by
the Direct Advance Premium.

     The Aggregate Limit for Section A shall equal 167% (one hundred sixty-seven
percent) of Section A Advance and Actual Consideration. If Section A is
converted to Section B, the Aggregate Limit for Section A shall be $0 (zero
dollars).

Section B - Aggregate Excess of Loss Coverage

     Should the Ceding Company's Loss Ratio exceed 65% (seventy-five percent) of
the SNWP (hereinafter called the Retention), the Reinsurers shall be liable for
100% (one hundred percent) of the paid amount of Ultimate Net Losses in excess
of the Retention subject to a maximum Aggregate Limit of 75% (seventy-five
percent) of SNWP or $100,000,000 (one hundred million dollars), whichever is the
lesser. The Reinsurers' maximum liability shall be subject to further limitation
such that no more than $20,000,000 (twenty million dollars) Ultimate Net Loss in
all shall be recoverable from the Reinsurers in respect of losses emanating from
a loss layer of $7,000,000 (seven million dollars) Ultimate Net Loss, each and
every loss, in excess of $3,000,000 (three million dollars) Ultimate Net Loss,
each and every loss.

     Section B Aggregate Excess of Loss Coverage shall cover the Ceding Company
on the basis of the coverage of the original Policies. If the Section A Quota
Share Coverage is

                                       4
<PAGE>

converted to Section B Aggregate Excess of Loss Coverage, then Section B shall
also cover the Ceding Company's original Policies pertaining to Direct Advance
Premium in respect of the Coverage Period. If Section A is not converted to
Section B, Section B shall not cover the original policies during the coverage
time pertaining to the Direct Advance Premium.

DEFINITIONS
-----------

     A.   "Cumulative Subject Net Written Premiums" or "SNWP" shall mean
          cumulative Direct Written and Assumed Written Premium Income less
          cancellations and returns and less premiums paid for all other
          reinsurances for the Coverage Period, except for Non-Traditional
          Reinsurance Agreements which shall be disregarded for the calculation
          of SNWP.

          If the Section A Quota Share Coverage is converted to the Section B
          Aggregate Excess of Loss Coverage, SNWP shall include all Direct
          Advance Premium in respect of the Coverage Period. If the Section A
          Quota Share Coverage is not converted to Section B Aggregate Excess of
          Loss Coverage, SNWP shall exclude all Direct Advance Premium.

     B.   "Non-Traditional Reinsurance Agreements" shall mean any reinsurance
          agreement which allows for Profit Sharing (or any other form of
          contractual adjustment) exceeding 25% (twenty-five percent) of initial
          reinsurance premium paid.

     C.   The term "Ultimate Net Loss" means the actual loss including any and
          all vicarious liability, arising from a Loss Occurrence as covered in
          accordance with the BUSINESS COVERED Article, including pro rata Loss
          Adjustment Expense, 90% (ninety percent) of Loss in Excess of Policy
          Limits and 90% (ninety percent) of Extra Contractual Obligations, and
          including losses incurred but not yet reported, all paid, payable or
          to be paid by the Ceding Company after making deductions for all
          recoveries, salvages, subrogations and all claims on inuring
          reinsurance, whether such reinsurance is collectible or not; provided,
          that in the event of the insolvency of the Ceding Company, payment by
          the Reinsurers shall be made in accordance with the provisions of the
          INSOLVENCY Article. Nothing herein shall be construed to mean that
          losses under this Treaty are not recoverable until the Ceding
          Company's Ultimate Net Loss has been ascertained.

          Ultimate Net Loss shall exclude from coverage hereon, all combined
          Excess of Policy Limits and Extra Contractual Obligations liability in
          excess of $16,875,000 (sixteen million eight hundred and seventy-five
          thousand dollars) any one loss occurrence or claim first made and
          $33,750,000 (thirty-three million seven hundred and fifty thousand
          dollars) in the aggregate. Both of these amounts shall be after
          applying the 90% (ninety

                                       5
<PAGE>

          percent) factor for Excess of Policy Limits/Extra Contractual
          Obligations coverage. The $16,875,000 (sixteen million eight hundred
          and seventy-five thousand dollars) therefore, relates to $18,750,000
          (eighteen million seven hundred and fifty thousand dollars) of Excess
          of Policy Limits/Extra Contractual Obligations liability from ground
          up in respect of a single occurrence and $33,750,000 (thirty-three
          million seven hundred and fifty thousand dollars) relates to
          $37,500,000 (thirty-seven million five hundred thousand dollars) of
          aggregate Excess of Policy Limits/Extra Contractual Obligations
          Ultimate Net Loss.

     D.   "Loss Adjustment Expense" means all costs and expense allocable to a
          specific claim or claims that are incurred by the Ceding Company in
          the investigation, appraisal, adjustment, settlement, litigation,
          defense or appeal of a specific claim, including court costs and costs
          of supersedeas and appeal bonds, and including a) pre-judgment
          interest, unless included as part of the award or judgment; b)
          post-judgment interest; and c) legal expenses and costs incurred in
          connection with coverage questions and legal actions connected
          thereto. Loss Adjustment Expense does not include Unallocated Loss
          Adjustment Expense. Unallocated Loss Adjustment Expense includes, but
          is not limited to salaries and expenses of employees, and office and
          other overheads.

     E.   "Policies" means any and all original policies, contracts, and binders
          of insurance or reinsurance underwritten by the Ceding Company, issued
          in the state of New Jersey to individual and/or groups of physicians
          and/or dentists and classified under the listing below:

          1.   Medical and Dental Practitioner Professional Liability (including
               HIV Endorsement Coverage)*;
          2.   Directors and Officers Liability;
          3.   All Property and other Coverages as provided in conjunction with
               Professional Liability Coverages;
          4.   Property Highly Protected Risk Assumed;
          5.   Medical Office Policy Coverages;
          6.   Other Health Care Institution Liability;
          7.   Professional Premises Liability;
          8.   Commercial General Liability;
          9.   Excess Umbrella Liability; or
          10.  Errors and Omissions Liability.

          "Policies" shall also mean assumed reinsurance from Lawrenceville Re,
          Ltd. of Bermuda (Lawrenceville Re), and Lawrenceville Property and
          Casualty Insurance Company (LP&C), in respect of assumed reinsurance
          underwritten by Lawrenceville Re and original policies, contracts, and
          binders of insurance or reinsurance underwritten by LP&C and
          classified as Medical and Dental Practitioner Professional Liability
          (including HIV Endorsement Coverage - but only to the extent the
          underlying business is

                                       6
<PAGE>

          issued in the state of New Jersey to individual and/or groups of
          physicians and/or dentists); or

          * "Policies" shall only include HIV coverage to insured medical and
          dental practitioners of the Ceding Company. Coverages for others for
          HIV shall only be available upon Reinsurers' approval.

     F.   "Loss Ratio" means the ratio of Ultimate Net Losses incurred divided
          by Cumulative Subject Net Written premium as of the date of
          calculation.

     G.   "Loss Occurrence" means Loss Occurrence or medical incident, or
          otherwise the event giving rise to coverage, all as defined and
          provided within the underlying Policies underwritten by the Ceding
          Company.

     H.   "Coverage Period" means the period beginning January 1st, 2002, 12:01
          a.m., Eastern Standard Time, and ending August 1st, 2002, 12:01 a.m.,
          Eastern Standard Time.

     I.   "Term" means the period beginning November 1st, 2001, 12:01 a.m.,
          Eastern Standard Time, and ending August 1st, 2002, 12:01 a.m.,
          Eastern Standard Time. There will be no coverage for Policies with
          advance premium payment on or after November 1st, 2001, providing
          coverage that becomes effective after the Coverage Period.

     J.   "Direct Advance Premium" shall mean all actual amounts collected by
          the Ceding Company from its insureds before January 1st, 2002, in
          respect of coverages provided by the Ceding Company during the
          Coverage Period.

NET RETAINED LIABILITY
----------------------

     This Treaty applies only to that portion of any Loss Occurrence or claim
first made which the Ceding Company retains net for its own account. All other
Reinsurance Agreements shall inure to the benefit of this Treaty and be deemed
in place until all liability hereon is finalized.

     The Ceding Company warrants that the maximum Net Retained Liability is as
follows:

        POLICIES CLASSIFIED AS:         MAXIMUM NET RETAINED LIABILITY:
        Property insurance:
           Medical Office Policy:          $2,000,000 any one policy
           Other Property Coverage:        $500,000 each and every loss
        All Other Policies:                $10,000,000 each and every loss

                                       7
<PAGE>

The above figures pertain to indemnity only. Therefore, Net Retained Liability
would be increased in respect of pro rata Loss Adjustment Expenses. The Ceding
Company must obtain special acceptance from Reinsurers prior to exceeding the
above maximum Net Retained Liability.

     Furthermore it is warranted that less than 5% (five percent) of the Ceding
Company's SNWP or $7,000,000 (seven million dollars), whichever the greater,
will originate from assumed reinsurance business other than from Lawrenceville
Re and LP&C.

SECTION A: ADVANCE AND ACTUAL CONSIDERATION, SECTION B: ACTUAL CONSIDERATION,
-----------------------------------------------------------------------------
ADDITIONAL COVERAGE CONSIDERATION, CEDING COMMISSION, AND REINSURERS' EXPENSE
-----------------------------------------------------------------------------
CHARGE
------

                   SECTION A ADVANCE AND ACTUAL CONSIDERATION

     Commencing with the calendar quarter ending December 31st, 2001, and each
subsequent quarter end, the Ceding Company shall calculate the required Section
A premium within 45 (forty-five) days of each calendar quarter end.

     Section A Advance and Actual Consideration shall be equal to the sum of:

               1.   Section A Funds Withheld Premium; and
               2.   Ceding Commission; and
               3.   Reinsurers' Expense Charge.

     Section A Funds Withheld Premium shall be equal to 75% (seventy-five
percent) of all Direct Advance Premium received through December 31st, 2001.
Section A Advance and Actual Consideration shall be provisionally based upon the
Direct Advance Premium estimated and reported by the Ceding Company on or before
December 15th, 2001. The Ceding Company shall recalculate Section A Advance and
Actual Consideration within 45 (forty-five) days subsequent to January 1st,
2002.

     All Section A Funds Withheld Premium due hereunder shall be deemed to be
credited (or debited) from the Funds Withheld Account as of November 1st, 2001,
for Interest Credit purposes hereon. Therefore, any adjustments to increase
Section A Funds Withheld Premium shall result in an Interest Credit from
November 1st, 2001, to the date of such adjustment. Any adjustments to decrease
Section A Funds Withheld Premium shall result in a reduction of Interest Credit
from November 1st, 2001, to the date of such adjustment.

                                       8
<PAGE>

             THE PREMIUM IN RESPECT OF SECTION A MAY BE CONVERTED TO
                 SECTION B, SUBJECT TO THE TERMS OF THE TREATY.

                         SECTION B ACTUAL CONSIDERATION

     Commencing with the calendar quarter ending March 31st, 2002, and each
subsequent quarter end, the Ceding Company shall calculate the required Section
B premium within 45 (forty-five) days of each calendar quarter end.

     Section B Actual Consideration shall be equal to the sum of:

               1.   Section B Funds Withheld Premium; and
               2.   Ceding Commission; and
               3.   Reinsurers' Expense Charge.

     Section B Funds Withheld Premium shall be equal to the sum of:

               1.   58% of ceded Ultimate Net Loss in excess of the Retention up
                    to 30% of SNWP; and
               2.   63% of ceded Ultimate Net Loss in the layer 35% of SNWP
                    excess of 95% of SNWP.

     All Section B Funds Withheld Premium due hereunder shall be deemed to be
credited (or debited) from the Funds Withheld Account as of November 1st, 2001,
for Interest Credit purposes hereon. Therefore, any adjustments to increase the
Section B Funds Withheld Premium shall result in an Interest Credit from
November 1st, 2001, to the date of such adjustment. Any adjustments to decrease
Section B Funds Withheld Premium shall result in a reduction of Interest Credit
from November 1st, 2001, to the date of such adjustment.

                        ADDITIONAL COVERAGE CONSIDERATION

     If any of the following events occur, any Reinsurer may unilaterally and
individually, for its respective interests, offer at any time, Additional
Section B Coverage up to 7% of cumulative SNWP excess of 140% of cumulative SNWP
in respect of covered losses:

     1.   The Funds Withheld Account balance falls below $500,000; or
     2.   The Ceding Company's Risk-Based Capital Ratio at any year-end falls
          below Mandatory Control Level as established by the NAIC; or
     3.   The Ceding Company's Statutory Policyholders' Surplus at any time
          falls below $50 million; or
     4.   The Additional Coverage Consideration will not reduce the Ceding
          Company's Statutory Net Income or Statutory Policyholders' Surplus for
          the quarter that the Additional Coverage Consideration applies.

                                       9
<PAGE>

     If a Reinsurer offers Additional Section B Coverage, the Reinsurer shall be
entitled to Additional Coverage Consideration equivalent to 60% (sixty percent)
of the Additional Coverage provided. The Additional Coverage Consideration shall
be withheld by the Ceding Company and credited to the Funds Withheld Account as
of November 1st, 2001, for all purposes hereon including Investment Credit. No
Reinsurers' Expense Charge or Ceding Commission shall be due on such Additional
Coverage Consideration.

                                CEDING COMMISSION

     Reinsurers shall allow a Ceding Commission of $2,000,000 (two million) to
be due to the Ceding Company on November 1st, 2001. There shall be no increase
or decrease to this amount based upon loss experience under this Treaty.

                           REINSURERS' EXPENSE CHARGE

     The provisional Reinsurers' Expense Charge shall be $1,350,000 (one
million, three hundred and fifty thousand dollars), due on or before July 31,
2002.

     The Reinsurers Expense Charge shall be recalculated as $400,000 plus 8% of
the sum of Section A Funds Withheld Premium and Section B Funds Withheld
Premium, subject to a minimum Reinsurers' Expense Charge of $1,350,000, and
shall be redetermined and paid annually within 60 (sixty) days in arrears of
each calendar year end. Payments shall be made by direct payment from the debtor
to creditor party at such times.

     There shall be no interest paid to Reinsurers on Reinsurers' Expenses
Charge paid or refund of interest on Reinsurers' Expense Charge which is
refunded under this Treaty.

OFFSET AND SECURITY
-------------------

     A.   Each party hereto has the right, which may be exercised at any time,
          to offset any amounts, whether on account of Consideration or losses
          and allocated Loss Adjustment Expenses or otherwise, due from such
          party to another party under this Treaty, against any amounts, whether
          on account of Consideration or losses and allocated Loss Adjustment
          Expenses or otherwise due from the latter party to the former party.
          The Party asserting the right of offset may exercise this right,
          whether as assuming Reinsurers or Ceding Company in this Treaty.

     B.   Each party hereby assigns and pledges to the other party (or to each
          other party, if more than one) all of its rights under this Treaty to
          receive Consideration or loss payments at any time from such other
          party ("Collateral"), to secure its Consideration or loss obligations
          to such other party at any time under this Treaty ("Secured
          Obligations"). If at any time a party is in default under any Secured
          Obligation or shall be subject to any liquidation, rehabilitation,
          reorganization or conservation proceeding, each other party shall be
          entitled in its discretion, to apply or to withhold for the

                                       10
<PAGE>

          purpose of applying in due course, any Collateral assigned and pledged
          to it by the former party and otherwise to realize upon such
          Collateral as security for such Secured Obligations.

     C.   The security interest described herein, and the term "Collateral,"
          shall apply to all payments and other proceeds in respect of the
          rights assigned and pledged. A party's security interest in Collateral
          shall be deemed evidenced only by the counterpart of this Treaty
          delivered to such party.

     D.   Each right under this Article is a separate and independent right,
          exercisable, without notice or demand, alone or together with other
          rights, in the sole election of the party entitled thereto, and no
          waiver, delay, or failure to exercise, in respect of any right, shall
          constitute a waiver of any other right. The provisions of this Article
          shall survive any cancellation or other termination of this Treaty.

REPORTS AND LOSS SETTLEMENTS
----------------------------

A.   REPORTS

     Within 60 (sixty) days following the end of each calendar quarter, the
Ceding Company will report in writing to the Reinsurers for this Treaty:

     1.   SNWP for the quarter and cumulative SNWP.

     2.   All Consideration calculations as necessary.

     3.   Summary of Ultimate Net Losses and ceded Ultimate Net Losses paid
          during the period and inception to date.

     4.   Summary of Ultimate Net Losses and ceded Ultimate Net Losses
          outstanding including a report of incurred but not reported amounts.

     5.   Individual claim information (claim manager's report) for all
          individual claims in excess of $2,000,000 (two million dollars)
          indemnity from ground up and for claims in excess of $750,000 (seven
          hundred and fifty thousand dollars) upon Reinsurers' specific request.

     6.   Any other information needed by the Reinsurers to evaluate this Treaty
          which is reasonably available to the Ceding Company.

     7.   A report detailing the activity and balance within the Funds Withheld
          Account.

                                       11
<PAGE>

B.   LOSS SETTLEMENTS

     1.   Following each quarterly report, the Reinsurers shall pay all
          cumulative Ultimate Net Losses Paid by the Ceding Company in respect
          of Business Covered during the Coverage Period in excess of the Ceding
          Company's Retention subject to the Aggregate Limits hereon. Payment
          shall be made at 90 (ninety) days following each calendar quarter end
          if paid by Reinsurers from other funds of the Reinsurers. Loss
          Settlements shall be first paid by deduction from the Funds Withheld
          Account, which shall be debited at 90 (ninety) days following each
          calendar quarter. Loss reimbursement at any calendar quarter shall be
          equal to the amount of such cumulative Ultimate Net Losses Paid at
          each date in excess of the Retention less net loss reimbursements
          previously made by the Reinsurers, subject to the Aggregate Limits in
          accordance with the COVERAGES AND AGGREGATE LIMITS Article.

     2.   All loss payments, including all Commutation payments, if any, above
          will be firstly made by deduction from Section A Funds Withheld
          Premium, Section B Funds Withheld Premium, and Additional Coverage
          Consideration, and then from the Interest Credit components of the
          Funds Withheld Account by the Ceding Company until depleted.
          Thereafter, Reinsurers shall pay from other funds of Reinsurers
          subject to all of the terms hereon.

FUNDS WITHHELD ACCOUNT AND INTEREST CREDIT
------------------------------------------

                             FUNDS WITHHELD ACCOUNT

     The Ceding Company shall maintain a cumulative Funds Withheld Account
comprised of the following amounts:

     1.   The Funds Withheld Account on or before October 30th, 2001 shall be
          equal to zero.

     2.   The Funds Withheld Account at December 31, 2001, and each subsequent
          calendar quarter end shall be equal to the Funds Withheld Account at
          the end of the prior calendar quarter plus any amounts credited or
          debited during the quarter for the following:

          a.   Section A Funds Withheld Premium and Section B Funds Withheld
               Premium, if any; less
          b.   Ceded Ultimate Net Losses paid under this Treaty for the prior
               calendar quarter (including Commutation payments); plus
          c.   Interest Credit.

                                       12
<PAGE>

     The Ceding Company shall report balances quarterly to the Reinsurers as
soon as practicable but no later than 75 (seventy-five) days in arrears of each
calendar quarter end.

     The Reinsurers shall not transfer or assign their rights to the Funds
Withheld Account hereon unless this Treaty is surrendered and a new Treaty is
issued. Under any and all circumstances, the Ceding Company must make a book
entry of a transfer or assignment in order for such transfer or assignment to be
valid.

     Upon finalization of the payment of all losses recoverable hereon and/or
Commutation, if any, the Reinsurers will pay to the Ceding Company the entire
amount of the remaining Funds Withheld Account balance, if any.

                                 INTEREST CREDIT

     The Ceding Company shall credit the Funds Withheld Account monthly at each
month end with interest calculated by applying a monthly rate equal to
one-twelfth (1/12th) of 5.84% multiplied by the actual daily average Funds
Withheld Account balance for the respective calendar month.

     Interest Credit shall continue even in the event of the Ceding Company's
insolvency.

LIABILITY OF THE REINSURERS AND CURRENCY
----------------------------------------

     A.   The liability of the Reinsurers shall follow that of the Ceding
          Company in every case and be subject in all respects to all the
          general and specific stipulations, clauses, waivers and modifications
          of the Ceding Company's policies and any endorsements thereon.
          However, in no event shall this be construed in any way to provide
          coverage outside the terms and conditions set forth in this Treaty.

     B.   Nothing herein shall in any manner create any obligation or establish
          any rights against the Reinsurers in favor of any third party or any
          persons not parties to this Treaty.

     C.   All of the provisions of this Treaty involving dollar amounts are
          expressed in terms of United States Dollars and all Consideration and
          loss and allocated Loss Adjustment Expense payments hereunder shall be
          made in United States Dollars.

                                       13
<PAGE>

COMMUTATION
-----------

     The Ceding Company shall have the sole option, effective at any calendar
year end on or after December 31st, 2002, to commute all ceded liability
outstanding hereunder. At Commutation, the Funds Withheld Account shall be
dissolved, the collateral held in the Funds Withheld Trust Account, if any,
shall be released, and the Ceding Company shall pay the entire amount of the
Funds Withheld Account to the Reinsurers hereon. The Ceding Company may offset
the payment of the Funds Withheld Account against the Profit Commission, equal
to 100% of the positive Funds Withheld Account balance that the Reinsurers are
required to pay at such time.

     Said payment shall constitute a full and final settlement of all terms of
this Treaty. The Ceding Company will execute a hold harmless Agreement so
stating and the Reinsurers will be thereby released from all current and future
liability hereunder.

EXCESS OF ORIGINAL POLICY LIMITS
--------------------------------

     This Treaty shall protect the Ceding Company, within the limits hereof, for
90% (ninety percent) of loss in excess of its original policy limits, such loss
in excess of the limit having been incurred because of failure by it to settle
within the policy limit or by reason of alleged or actual negligence, fraud, or
bad faith in rejecting an offer of settlement or in the preparation of an appeal
consequent upon such action.

     For the purpose of this Article, the word "loss" shall mean any amounts for
which the Ceding Company would have been contractually liable to pay had it not
been for the limit of the original policy.

     However, this Article shall not apply where the loss has been incurred due
to fraud by a member of the Board of Directors or a corporate officer of the
Ceding Company acting individually or collectively or in collusion with any
individual or corporation or any other organization or party involved in the
presentation, defense or settlement of any claim covered hereunder.

EXTRA CONTRACTUAL OBLIGATIONS
-----------------------------

     This Treaty shall protect the Ceding Company for 90% (ninety percent) of
any Extra Contractual Obligations within the limits hereof. The term "Extra
Contractual Obligations" is defined as those liabilities not covered under any
other provision of this Treaty and which arise from the handling of any claim on
business covered hereunder, such liabilities arising because of, but not limited
to, the following: failure by the Ceding Company to settle within the policy
limit, or by reason of alleged or actual negligence, fraud, or bad faith in
rejecting an offer of settlement or in the preparation of the defense or in the
trial of any action against its insured or reinsured or in the preparation or
prosecution of an appeal consequent upon such action.

                                       14
<PAGE>

     The date on which any Extra Contractual Obligation is incurred by the
Ceding Company shall be deemed, in all circumstances to be the date of the
original Loss Occurrence.

     However, this Article shall not apply where the loss has been incurred due
to fraud by a member of the Board of Directors or a corporate officer of the
Ceding Company acting individually or collectively or in collusion with any
individual or corporation or any other organization or party involved in the
presentation, defense or settlement of any claim covered hereunder.

DELAYS, ERRORS AND OMISSION
---------------------------

     Any inadvertent delay, omission or error shall not be held to relieve
either party hereto from any liability which would attach to it hereunder if
such delay, omission or error had not been made, providing such delay and
notification, omission or error is rectified upon discovery.

ACCESS TO RECORDS
-----------------

     The Ceding Company shall place at the disposal of the Reinsurers at all
times, and the Reinsurers shall have the right to inspect, through its
authorized representatives, all books, records and papers of the Ceding Company
in connection with any reinsurance hereunder, or claims in connection herewith.

     The Reinsurers agree that they will not disclose any confidential
information obtained by it hereunder to parties not subject to this Treaty
except under the following circumstances and then only as necessary:

     A.   When disclosure of such information is required in the normal course
          of Reinsurers' business; or

     B.   With the prior written consent of the Ceding Company; or

     C.   When Reinsurers are required by a subpoena or court order to disclose
          such information. The Reinsurers shall promptly notify the Ceding
          Company of any attempt by a third party to obtain from it any such
          confidential information.

     Reinsurers will provide the Ceding Company or its designated representative
with such information as Reinsurers and Ceding Company may agree is necessary to
the Ceding Company's handling of the business reinsured herein.

     The obligations contained in this provision shall survive termination of
this Treaty.

                                       15
<PAGE>

ACTUARIAL REVIEW
----------------

     Should the Reinsurers desire at any time to review the loss reserves
established by the Ceding Company as respects Ultimate Net Losses, the
Reinsurers shall select an independent actuarial firm acceptable to the Ceding
Company to perform a reserve analysis. The costs of any reserve analysis
performed under this Article will be borne by the Reinsurers hereon. Such a
review shall be subject to the provisions of the ACCESS TO RECORDS Article.

LOSS RESERVE AND ADVANCE PREMIUM FUNDING
----------------------------------------

     The Reinsurers will maintain appropriate reserves with respect to their
share of the Advance Premium and Loss Reserves ceded and required under the
terms of this Treaty which are reported by the Ceding Company on the Business
Covered of this Treaty.

     Until Commutation or until all liability of the Reinsurers under this
Treaty has been otherwise extinguished, Reinsurers agree to provide a clean,
irrevocable and unconditional Letter of Credit in favor of the Ceding Company
issued by a bank acceptable to the Ceding Company adjusted to at all times be
equal to the ceded cumulative Ultimate Net Losses outstanding and Advance
Premium ceded hereunder less the Funds Withheld Account balance at such dates.
Such Letter of Credit shall be in the form, amount and with an NAIC approved
bank to allow the Ceding Company to take Full Statutory Credit for amounts
recoverable under this Treaty.

     The Ceding Company also agrees to not make drawings upon the Letter of
Credit provided by the Reinsurers for any purpose other than to reimburse the
Ceding Company for loss settlements due under this Treaty for which one or more
of the Reinsurers are in default by more than seven days and provided that the
Ceding Company shall give the Reinsurers three days written notice prior to
making any drawings.

     The Ceding Company shall reimburse the Reinsurers for reasonable bank fees
that Reinsurers are required to pay to supply the Letter of Credit, subject to a
maximum of 1% (one percent) of the amount of the Letter of Credit issued or
maintained hereon as of each December 31st. The Reinsurers shall request such
reimbursement whereupon the Ceding Company shall make payment by direct wire
transfer to the Reinsurers. All such amounts shall not be deducted from the
Funds Withheld Account.

FUNDS WITHHELD TRUST ACCOUNT
----------------------------

     In the event that the Ceding Company experiences any one of the following
circumstances, the Reinsurers may require a Trust Account, with an independent
bank, to be established for the purposes of collateralizing the Funds Withheld
Account heron:

     1.   The Ceding Company's A. M. Best Rating reaches a level lower than B+
          or the Ceding Company loses its A. M. Best Rating assignment; or

                                       16
<PAGE>

     2.   The Ceding Company's Statutory Policyholders' Surplus falls below
          $60,000,000 (sixty million dollars); or
     3.   The Ceding Company is acquired or becomes controlled or amalgamated
          with or has its shares purchased for the purpose of gaining control by
          any other party.

     The Ceding Company shall fully and promptly comply with such request from
the Reinsurers. The Ceding Company shall transfer marketable assets with a
market value equal to or greater than the required Funds Withheld Account
balance within 30 (thirty) days from the Reinsurers' request to do so. The
Ceding Company shall also transfer additional assets to the Trust Account, if
needed, to maintain the Trust Account balance to be equal to or greater than the
Funds Withheld Account balance at each calendar quarter end including the
requisite Interest Credit required hereon.

INSOLVENCY
----------

     In the event of a receivership, the reinsurance recoverables due under this
Treaty will be payable by the Reinsurers directly to the receiver, after
reasonable provision for verification, on the basis of claims allowed against
the insolvent Ceding Company by any court of competent jurisdiction having
authority to allow such claims or allowed by the receiver as a result of the
conclusion of the claim filing, approval, and appeal process before the
receiver. Regardless of any provision in this Treaty or other agreement to the
contrary, payment will be made without diminution because of such insolvency or
because the receiver has failed to pay all or a portion of any claims.

     The receiver of the Ceding Company will give or arrange to give to the
Reinsurers, written notice of the pendency of a claim against the Ceding
Company, within a reasonable period of time after the initiation of the
receivership. Failure to give such notice will not excuse the obligation of the
Reinsurers unless they are substantially prejudiced thereby. The Reinsurers may
interpose, at their own expense, in the proceeding where such claim is to be
adjudicated, any defense or defenses which they may deem available to the Ceding
Company or its receiver. The reasonable expense thus incurred by the Reinsurers
will be payable, subject to court approval, out of the estate of the insolvent
Ceding Company as part of the expense of the receivership to the extent of a
proportionate share of the benefit which may accrue to the Ceding Company in
receivership, solely as a result of the defense undertaken by the Reinsurers.

     Payments by the Reinsurers will be made directly to the receiver of the
Ceding Company except where this Treaty or the contract of insurance
specifically provides another payee for such reinsurance in the event of the
insolvency of the Ceding Company.

     Should the Ceding Company go into liquidation or should a receiver be
appointed, the Reinsurers shall be entitled to deduct from any sums which may be
or may become due to the Ceding Company under this Treaty any sums which are due
to the Reinsurers by the Ceding Company under this Treaty and which are payable
at a fixed or stated date, as well as any other sums due the Reinsurers, to the
extent permitted under applicable law.

                                       17
<PAGE>

ARBITRATION
-----------

     A.   As a condition precedent to any right of action hereunder, in the
          event of any dispute or difference of opinion hereinafter arising with
          respect to this Treaty, it is hereby mutually agreed that such dispute
          or difference of opinion shall be submitted to arbitration. One
          Arbiter shall be chosen by the Ceding Company, the other by the
          Reinsurers, and the Umpire shall be chosen by the two Arbiters before
          they enter upon arbitration, all of whom shall be active or retired
          disinterested executive officers of insurance or reinsurance
          companies. In the event that either party should fail to chose an
          Arbiter within 30 (thirty) days following a written request by the
          other party to do so, the requesting party may choose two Arbiters who
          shall in turn choose an Umpire before entering upon arbitration. If
          the two Arbiters fail to agree upon the selection of an Umpire within
          30 (thirty) days following their appointment, each Arbiter shall
          nominate three candidates within 10 (ten) days thereafter, two of whom
          the other shall decline, and the decision shall be made by drawing
          lots.

     B.   Each party shall present its case to the Arbiters within 30 (thirty)
          days following the date of appointment of the Umpire. The Arbiters
          shall consider this Treaty as an honorable engagement rather than
          merely as a legal obligation and they are relieved of all judicial
          formalities and may abstain from following the strict rules of law.
          The decision of the Arbiters shall be final and binding on both
          parties; but failing to agree, they shall call in the Umpire and the
          decision of the majority shall be final and binding upon both parties.
          The decision shall be made in writing and will state the factual and
          legal basis supporting such decision. Judgment upon the final decision
          of the Arbiters may be entered in any court of competent jurisdiction.

     C.   If more than one Reinsurer is involved in the same dispute, all such
          Reinsurers shall constitute and act as one party for the purposes of
          this Article and communications shall be made by the Ceding Company to
          each of the Reinsurers constituting one party provided, however, that
          nothing herein shall impair the rights of such Reinsurers to assert
          several, rather than joint, defenses or claims, nor be construed as
          changing the liability of the Reinsurers participating under the terms
          of this Treaty from several to joint.

     D.   Each party shall bear the expense of its own Arbiter, and shall
          jointly and equally bear with the other the expense of the Umpire and
          of the arbitration. In the event that the two Arbiters are chosen by
          one party, as above provided, the expense of the Arbiters, the Umpire
          and the arbitration shall be equally divided between the two parties.
          Any arbitration shall be conducted in Lawrenceville, New Jersey.

                                       18
<PAGE>

CHANGES IN ADMINISTRATIVE PRACTICE
----------------------------------

     If any intentional or unintentional change in the Ceding Company's
processing or payment of claims materially increases the Reinsurers' economic
loss under this Treaty from what the economic loss would have been if there had
been no such change, the Reinsurers shall prepare, and the Ceding Company shall
accept, an adjustment of the portion of claims which is reimbursable, or any
adjustments which will make the Reinsurers' risk position equivalent to that
which would have been obtained under this Treaty if there had been no such
change. The Reinsurers shall have the right to use auditing techniques, sampling
techniques, or to otherwise investigate the nature and effect of any such change
in administrative practices or of any possible compensatory adjustment therefor.
Any dispute with respect to such adjustment shall be resolved by arbitration as
provided in the ARBITRATION Article.

TAXES
-----

     The Ceding Company is solely liable for any Federal Excise Tax (FET)
applicable to this Treaty. Any FET to be paid shall be paid directly by the
Ceding Company to the taxing authorities and is in addition to the
Consideration. No deduction shall be made from the Funds Withheld Account.

SERVICE OF SUIT
---------------

     It is agreed that in the event of the failure of Reinsurers hereon to pay
any amount claimed to be due hereunder, Reinsurers hereon, at the request of the
Ceding Company will submit to the jurisdiction of a court of competent
jurisdiction within the United States. The foregoing shall not constitute a
waiver of the right of the Reinsurers to commence any suit in, or to remove,
remand or transfer any suit to any other court of competent jurisdiction in
accordance with the applicable statutes of the state or United States pertinent
thereto. It is further agreed that this Treaty shall be governed by the laws of
the State of New Jersey.

     It is further agreed that service of process in such suit may be made upon
Mendes and Mount, 750 Seventh Avenue, New York, New York 10019-6829, United
States of America and that in any suit instituted against any one of them upon
this Treaty, Reinsurers will abide by the final decision of such Court or any
Appellate Court in the event of an appeal.

     The above named are authorized and directed to accept service of process on
behalf of Reinsurers in any suit and/or upon the request of the Ceding Company
to give a written undertaking to the Ceding Company that they will enter a
general appearance upon Reinsurers' behalf in the event such a suit shall be
instituted.

     Further, pursuant to any statute of any state, territory or District of the
United States which makes provision therefor, Reinsurers hereon hereby designate
the

                                       19
<PAGE>

Superintendent, Commissioner or Director of Insurance or other officer specified
for that purpose in the statute, or his successor or successors in office, as
their true and lawful attorney upon whom may be served any lawful process in any
action, suit or proceeding instituted by or on behalf of the Ceding Company or
any beneficiary hereunder arising out of this Treaty, and hereby designate the
above named as the person to whom said officer is authorized to mail such
process or a true copy thereof.

NO ASSIGNMENT
-------------

     The Ceding Company and the Reinsurers hereon hereby agree that neither
party shall have the right to assign its respective interests and liabilities,
including the Funds Withheld Account, under this Treaty.

     Notwithstanding the above, this Article shall not restrict the Ceding
Company from making investments it deems appropriate.

INTERMEDIARY
------------

     Aon Re Inc., an Illinois corporation, or one of its affiliated corporations
duly licensed as a reinsurance intermediary, is hereby recognized as the
Intermediary negotiating this Treaty for all business hereunder. All
communications (including but not limited to notices, statements, premiums,
return premiums, commissions, taxes, losses, loss expenses, salvages, and loss
settlements) relating to this Treaty will be transmitted to the Ceding Company
or the Reinsurers through the Intermediary. Payments by the Ceding Company to
the Intermediary will be deemed payment to the Reinsurers. Payments by the
Reinsurers to the Intermediary will be deemed payment to the Ceding Company only
to the extent that such payments are actually received by the Ceding Company.

     Aon Re Inc. will hold any and all funds collected on the Reinsurers'
behalf, in a fiduciary capacity, in qualified United States financial
institution.

IN WITNESS WHEREOF, the parties hereto have caused this Treaty to be executed by
there duly authorized representatives.

Signed at LAWRENCEVILLE, NEW JERSEY

                             MIIX INSURANCE COMPANY

Signature:  ______________________________   Title:     ________________________

Attest:     ______________________________   Date:      ________________________

                                       20
<PAGE>

Signed at DUBLIN, IRELAND

                   HANNOVER REINSURANCE (IRELAND) LIMITED. 80%
                    E + S REINSURANCE (IRELAND) LIMITED. 20%

Signature:  ______________________________   Title:     ________________________

Attest:     ______________________________   Date:      ________________________

                                       21
<PAGE>

U.S.A.
------

            NUCLEAR INCIDENT EXCLUSION CLAUSE--LIABILITY--REINSURANCE
            ---------------------------------------------------------

1.   This reinsurance does not cover any loss or liability accruing to the
     Reassured as a member of, or subscriber to, any association of insurers or
     reinsurers formed for the purpose of covering nuclear energy risks or as a
     direct or indirect reinsurer of any such member, subscriber or association.

2.   Without in any way restricting the operation of paragraph 1 of this Clause
     it is understood and agreed that for all purposes of this reinsurance all
     the original policies of the Reassured (new, renewal and replacement) of
     the classes specified in Clause II of this paragraph 2 from the time
     specified in Clause III in this paragraph 2 shall be deemed to include the
     following provision (specified as the Limited Exclusion Provision):

     Limited Exclusion Provision*
     ---------------------------

     I.   It is agreed that the policy does not apply under any liability
          coverage, to INJURY, SICKNESS, DISEASE OR DESTRUCTION, BODILY INJURY
          OR PROPERTY DAMAGE with respect to which an insured under the policy
          is also an insured under a nuclear energy liability policy issued by
          Nuclear Energy Liability Insurance Association, Mutual Atomic Energy
          Liability Underwriters or Nuclear Insurance Association of Canada, or
          would be an insured under any such policy but for its termination upon
          exhaustion of its limit of liability.

     II.  Family Automobile Policies (liability only), Special Automobile
          Policies (private passenger automobiles, liability only), Farmers
          Comprehensive Personal Liability Policies (liability only),
          Comprehensive Personal Liability Policies (liability only) or policies
          of a similar nature; and the liability portion of combination forms
          related to the four classes of policies stated above, such as the
          Comprehensive Dwelling Policy and the applicable types of Homeowners
          Policies.

     III. The inception dates and thereafter of all original policies as
          described in II above, whether new, renewal or replacement, being
          policies which either
          (a) become effective on or after 1st May, 1960, or
          (b) become effective before that date and contain the Limited
          Exclusion Provision set out above;
          provided this paragraph 2 shall not be applicable to Family Automobile
          Policies, Special Automobile Policies, or policies or combination
          policies of a similar nature, issued by the Reassured on New York
          risks, until 90 days following approval of the Limited Exclusion
          Provision by the Governmental Authority having jurisdiction thereof.

                                   Page 1 of 4

<PAGE>

3.   Except for those classes of policies specified in Clause II of paragraph 2
     and without in any way restricting the operation of paragraph 1 of this
     Clause, it is understood and agreed that for all purposes of this
     reinsurance the original liability policies of the Reassured (new, renewal
     and replacement) affording the following coverages:
          Owners, Landlords and Tenants Liability, Contractual Liability,
          Elevator Liability, Owners or Contractors (including railroad)
          Protective Liability, Manufacturers and Contractors Liability, Product
          Liability, Professional and Malpractice Liability, Storekeepers
          Liability, Garage Liability, Automobile Liability (including
          Massachusetts Motor Vehicle or Garage Liability)
     shall be deemed to include, with respect to such coverages, from the time
     specified in Clause V of this paragraph 3, the following provision
     (specified as the Broad Exclusion Provision):

     Broad Exclusion Provision*
     -------------------------

     It is agreed that the policy does not apply:
     I.   Under any Liability Coverage, to ;INJURY, SICKNESS, DISEASE, DEATH OR
                                            DESTRUCTION, BODILY INJURY OR
                                            PROPERTY DAMAGE
          (a) with respect to which an insured under the policy is also an
              insured under a nuclear energy liability policy issued by Nuclear
              Energy Liability Insurance Association, Mutual Atomic Energy
              Liability Underwriters or Nuclear Insurance Association of
              Canada, or would be an insured under any such policy but for its
              termination upon exhaustion of its limit of liability; or
          (b) resulting from the hazardous properties of nuclear material and
              with respect to which (1) any person or organization is required
              to maintain financial protection pursuant to the Atomic Energy
              Act of 1954, or any law amendatory thereof, or (2) the insured
              is, or had this policy not been issued would be, entitled to
              indemnity from the United States of America, or any agency
              thereof, under any agreement entered into by the United States of
              America, or any agency thereof, with any person or organization.

     II.  Under any Medical Payments Coverage, or under any Supplementary
          Payments Provision

              relating to ;IMMEDIATE MEDICAL OR SURGICAL RELIEF, FIRST AID, to
              expenses incurred with respect to ;BODILY INJURY, SICKNESS,
              DISEASE OR DEATH, BODILY INJURY resulting from the hazardous
              properties of nuclear material and arising out of the operation of
              a nuclear facility by any person or organization.

     III. Under any Liability Coverage, to ;INJURY, SICKNESS, DISEASE, DEATH OR
          DESTRUCTION, BODILY INJURY OR PROPERTY DAMAGE resulting from the
          hazardous properties of nuclear material, if

              (a) the nuclear material (1) is at any nuclear facility owned by,
                  or operated by or on behalf of, an insured or (2) has been
                  discharged or dispersed therefrom;

                                   Page 2 of 4

<PAGE>

              (b) the nuclear material is contained in spent fuel or waste at
                  any time possessed, handled, used, processed, stored,
                  transported or disposed of by or on behalf of an insured; or
              (c) the ;INJURY, SICKNESS, DISEASE, DEATH OR DESTRUCTION, BODILY
                  INJURY OR PROPERTY DAMAGE arises out of the furnishing by an
                  insured of services, materials, parts or equipment in
                  connection with the planning, construction, maintenance,
                  operation or use of any nuclear facility, but if such facility
                  is located within the United States of America, its
                  territories, or possessions or Canada, this exclusion (c)
                  applies only to ;INJURY TO OR DESTRUCTION OF PROPERTY AT SUCH
                  NUCLEAR FACILITY, property damage to such nuclear facility and
                  any property thereat.

     IV.  As used in this endorsement:

              "HAZARDOUS PROPERTIES" include radioactive, toxic or explosive
              properties; "NUCLEAR MATERIALS" means source materials, special
              nuclear material or byproduct material; "SOURCE MATERIAL,"
              "SPECIAL NUCLEAR MATERIAL," and "BYPRODUCT MATERIAL" have the
              meanings given them in the Atomic Energy Act of 1954 or in any law
              amendatory thereof; "SPENT FUEL" means any fuel element or fuel
              component, solid or liquid, which has been used or exposed to
              radiation in a nuclear reactor; "WASTE" means any waste material
              (1) containing byproduct material and (2) resulting from the
              operation by any person or organization of any nuclear facility
              included within the definition of nuclear facility under paragraph
              (a) or (b) thereof; "NUCLEAR FACILITY" means
              (a) any nuclear reactor,
              (b) any equipment or device designed or used for (1) separating
                  the isotopes of uranium or plutonium, (2) processing or
                  utilizing spent fuel, or (3) handling, processing or packaging
                  waste,
              (c) any equipment or device used for the processing, fabricating
                  or alloying of special nuclear material if at any time the
                  total amount of such material in the custody of the insured at
                  the premises where such equipment or device is located
                  consists of or contains more than 25 grams of plutonium or
                  uranium 233 or any combination thereof, or more than 250 grams
                  of uranium 235,
              (d) any structure, basin, excavation, premises or place prepared
                  or used for the storage or disposal of waste,
              and includes the site on which any of the foregoing is located,
              all operations conducted on such site and all premises used for
              such operations; "nuclear reactor" means any apparatus designed
              or used to sustain nuclear fission in a self-supporting chain
              reaction or to contain a critical mass of fissionable material;

              WITH RESPECT TO INJURY TO OR DESTRUCTION OF PROPERTY, THE WORD
              "INJURY" OR "DESTRUCTION" INCLUDES ALL FORMS OF RADIOACTIVE
              CONTAMINATION OF PROPERTY.
              "PROPERTY DAMAGE" includes all forms of radioactive contamination
              of property.

                                   Page 3 of 4

<PAGE>

     V.   The inception dates and thereafter of all original policies affording
          coverages specified in this paragraph 3, whether new, renewal or
          replacement, being policies which become effective on or after 1st
          May, 1960, provided this paragraph 3 shall not be applicable to
          (i)  Garage and Automobile Policies issued by the Reassured on New
               York risks, or
          (ii) statutory liability insurance required under Chapter 90, General
               Laws of Massachusetts,
          until 90 days following approval of the Broad Exclusion Provision by
          the Governmental Authority having jurisdiction thereof.

4.   Without in any way restricting the operation of paragraph 1 of this Clause,
     it is understood and agreed that paragraphs 2 and 3 above are not
     applicable to original liability policies of the Reassured in Canada and
     that with respect to such policies this Clause shall be deemed to include
     the Nuclear Energy Liability Exclusion Provisions adopted by the Canadian
     Underwriters' Association or the Independent Insurance Conference of
     Canada.
--------------------------------------------------------------------------------

* NOTE: The words printed in italics in the Limited Exclusion Provision and in
the Broad Exclusion Provision shall apply only in relation to original liability
policies which include a Limited Exclusion Provision or a Broad Exclusion
Provision containing those words.

N.M.A. 1590 (21/9/67)
Approved by Lloyd's Underwriters' Non-Marine Association.

                      AMENDMENT TO THE DEFINITION OF WASTE

It is agreed that the definition of "WASTE" contained in sub-paragraph IV above
is amended to read as follows:

                           "WASTE" means any material

(a)  containing byproduct material other than the tailings or waste produced by
     the extraction or concentration of uranium or thorium from any ore
     processed primarily for its source material content, and
(b)  resulting from the operation by any person or organization of any nuclear
     facility included under the first two paragraphs of the definition of
     nuclear facility.

                                   Page 4 of 4

<PAGE>

NORTH AMERICAN WAR EXCLUSION CLAUSE (REINSURANCE)

As regards interests which at time of loss or damage are on shore, no liability
shall attach hereto in respect of any loss or damage which is occasioned by war,
invasion, hostilities, acts of foreign enemies, civil war, rebellion,
insurrection, military or usurped power, or martial law or confiscation by order
of any government or public authority.

This War Exclusion shall not, however, apply to interests which at time of loss
or damage are within the territorial limits of the United States of America
(comprising the fifty States of the Union and the District of Columbia and
including Bridges between the U.S.A. and Mexico provided they are under United
States ownership), Canada, St. Pierre and Miquelon, provided such interests are
insured under policies, endorsements or binders containing standard war or
hostilities or warlike operations exclusion clause.

N.M.A. 1230 (20/8/59)
Approved by Lloyd's Underwriters' Fire and Non-Marine Association.

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