364-DAY SECURED LIQUIDITY CREDIT FACILITY AGREEMENT

Exhibit 4.1

364-DAY SECURED LIQUIDITY CREDIT FACILITY AGREEMENT

dated as of

December 31, 2008

Between

THE PROGRESSIVE CORPORATION,

as the Borrower,

and

NATIONAL CITY BANK,

as the Lender.

Up to $150,000,000 Revolving Facility

TABLE OF CONTENTS

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EXHIBITS

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THIS 364-DAY SECURED LIQUIDITY CREDIT FACILITY AGREEMENT (as hereafter amended, supplemented, amended and restated or otherwise modified, this " Agreement ") is entered into as of December 31, 2008 between (i) The Progressive Corporation, an Ohio corporation (the " Borrower ") and (ii) National City Bank, as the lender (the " Lender ").

RECITALS:

WHEREAS, for the purposes specified in Section 5.06(a) and subject to the terms and conditions of this Agreement, the Borrower desires to obtain from the Lender Loans pursuant to the Revolving Commitments.

WHEREAS, the Lender is willing, on the terms and subject to the conditions hereinafter set forth, to make the Loans to the Borrower as set forth herein.

AGREEMENT:

In consideration of the premises and the mutual covenants contained herein, the parties hereto agree as follows:

ARTICLE I.

DEFINITIONS AND TERMS

Section 1.01 Certain Defined Terms . As used herein, the following terms shall have the meanings herein specified unless the context otherwise requires:

" Adjusted Eurodollar Rate " means, with respect to any Eurodollar Borrowing for any Interest Period, (a) an interest rate per annum (rounded upward, if necessary, to the next 1/100th of 1%) determined by the Lender to be equal to the LIBOR Rate for such Eurodollar Borrowing in effect for such Interest Period divided by (b) 1 minus the percentage of Statutory Reserves (if any) for such Eurodollar Borrowing for such Interest Period.

" Affiliate " means, with respect to any Person, any other Person directly or indirectly controlling, controlled by, or under direct or indirect common control with such Person, or, if the Lender is an investment fund, the investment advisor thereof and any investment fund having the same investment advisor. A Person shall be deemed to control a second Person if such first Person possesses, directly or indirectly, the power (i) to vote 20% or more of the securities having ordinary voting power for the election of directors or managers of such second Person (unless such Person is a Passive Investor) or (ii) to direct or cause the direction of the management and policies of such second Person, whether through the ownership of voting securities, by contract or otherwise. Notwithstanding the foregoing, the Lender shall not in any event be considered an Affiliate of the Borrower or any of its Subsidiaries.

" Agreement " has the meaning specified in the first paragraph of this Agreement.

" Applicable Eurodollar Margin " means 25.00 basis points for Eurodollar Loans.

" Authorized Officer " means any of the following officers: the Chairman, the President, the Chief Executive Officer, the Chief Financial Officer, the Treasurer, the Assistant Treasurer, the Secretary or the Chief Accounting Officer or such other Person as is authorized in writing to act on behalf of the Borrower

and is acceptable to the Lender. Unless otherwise qualified, all references herein to an Authorized Officer shall refer to an Authorized Officer of the Borrower.

" Bankruptcy Code " means Title 11 of the United States Code entitled "Bankruptcy," as now or hereafter in effect, or any successor thereto, as hereafter amended.

" Base Rate " means, for any day, a fluctuating interest rate per annum as shall be in effect from time to time which rate per annum shall at all times be equal to the greatest of (i) the rate of interest established by the Lender, from time to time, as its "prime rate," whether or not publicly announced, which interest rate may or may not be the lowest rate charged by it for commercial loans or other extensions of credit; (ii) the Federal Funds Effective Rate in effect from time to time, determined one Business Day in arrears, plus 1/2 of 1% per annum; and (iii) the one month Adjusted Eurodollar Rate in effect on such day (or if such day is not a Business Day, the immediately preceding Business Day) plus 2% per annum.

" Base Rate Loan " means any Loan bearing interest at a rate based upon the Base Rate in effect from time to time.

" Borrower " has the meaning specified in the first paragraph of this Agreement.

" Borrowing " means the incurrence of Revolving Loans consisting of one Type of Revolving Loan by the Borrower on a given date (or resulting from Conversions or Continuations on a given date) in the same currency, having in the case of any Eurodollar Loans the same Interest Period.

" Business Day " means (i) any day other than Saturday, Sunday or any other day on which commercial banks in Cleveland, Ohio are authorized or required by law to close and (ii) with respect to any matters relating to Eurodollar Loans, any day on which dealings in U.S. Dollars are carried on in the London interbank market.

" Change of Control " means (i) the acquisition of, or, if earlier, the shareholder or director approval of the acquisition of, ownership or voting control, directly or indirectly, beneficially or of record, on or after the Closing Date, by any Person or group (within the meaning of Rule 13d-3 of the SEC under the 1934 Act, as then in effect) other than a Passive Investor, of shares representing more than 20% of the aggregate ordinary Voting Power represented by the issued and outstanding capital stock of the Borrower; (ii) the sale of all or substantially all of the assets of the Borrower, or (iii) any merger, amalgamation, or combination by the Borrower with another Person in which the Borrower is not the surviving Person.

" Charges " has the meaning provided in Section 10.18 .

" Closing Date " means December 31, 2008, or such other date as shall be designated by mutual agreement of the parties.

" Code " means the Internal Revenue Code of 1986, as amended from time to time, and the regulations promulgated and the rulings issued thereunder. Section references to the Code are to the Code as in effect at the Closing Date and any subsequent provisions of the Code, amendatory thereof, supplemental thereto or substituted therefor.

" Collateral " means all of the property or assets at anytime securing or purporting to secure the Obligations and includes, without limitation, the Controlled Accounts, all property and assets held therein or credited thereto and all proceeds thereof.

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" Collateral Condition " means on any date and shall be deemed to be satisfied if as of such date there is Eligible Collateral held in the Controlled Accounts with an aggregate Collateral Value of not less than the aggregate amount of the Outstanding Loan Obligation as of such date.

" Collateral Value " means, as to any Eligible Collateral on any date, (i) with respect to cash, the Market Value thereof and (ii) with respect to any other Eligible Collateral, an amount equal to 95% of the Market Value thereof.

" Compliance Certificate " has the meaning provided in Section 6.01(c) .

" Confidential Information " has the meaning provided in Section 10.13(b) .

" Consolidated Net Worth " means at any time, all amounts that, in conformity with GAAP, would be included under the caption "total stockholders’ equity" (or any like caption) on a consolidated balance sheet of the Borrower and its consolidated subsidiaries at such time.

" Continue ," " Continuation " and " Continued " each refers to a continuation of a Eurodollar Loan for an additional Interest Period as provided in Section 2.07 .

" Control Agreement " means, with respect to a Controlled Account, an Account Control Agreement in a form satisfactory to the Lender among the Borrower, the Lender and the relevant Securities Intermediary.

" Controlled Account " means each of (a) the Controlled Securities Account and (b) any other securities account or deposit account that is designated in writing by the Lender and the Borrower as a "Controlled Account" for purposes of this Agreement, but does not include the Customer Deposit Account.

" Customer Deposit Account " means deposit account number 982302648 located at the Lender.

" Controlled Securities Account " means a securities account (as defined in the UCC) that (i) is maintained in the name of the Borrower at an office of the Lender or one of its Affiliates located in the United States of America and (ii) is subject to a Control Agreement.

" Convert ," " Conversion " and " Converted " each refers to a conversion of Loans of one Type into Loans of another Type.

" Credit Event " means the making of any Borrowing, any Conversion or Continuation.

" Credit Facility " means the credit facility established under this Agreement pursuant to which the Lender shall make Revolving Loans to the Borrower.

" Default " means any event, act or condition that with notice or lapse of time, or both, would constitute an Event of Default.

" Default Rate " means, for any day, with respect to any Loan, a rate per annum equal to two percent (2%) per annum above the interest rate that is or would be applicable from time to time to such Loan pursuant to Section 2.06(a) .

" Dollars ," " U.S. Dollars " and the sign " $ " each means lawful money of the United States.

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" Eligible Collateral " means (a) cash or (b) securities issued or directly and fully guaranteed or insured by the United States of America or any agency or instrumentality thereof ( provided that the full faith and credit of the United States of America is pledged in support thereof) having maturities of not more than one year from the date of acquisition or the date pledged as Collateral.

" Equity Interest " means with respect to any Person, any and all shares, interests, participations or other equivalents, including membership interests (however designated, whether voting or non-voting) of equity of such Person, including, if such Person is a partnership, partnership interests (whether general or limited) or any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, such partnership, but in no event will Equity Interest include any debt securities convertible or exchangeable into equity unless and until actually converted or exchanged.

" Eurodollar Borrowing " means any Borrowing consisting of Eurodollar Loans.

" Eurodollar Loan " means each Loan bearing interest at a rate based upon the Adjusted Eurodollar Rate.

" Event of Default " has the meaning provided in Section 8.01 .

" Facility Fee " has the meaning provided in Section 2.08 .

" Federal Funds Effective Rate " means, for any period, a fluctuating interest rate equal for each day during such period to the weighted average of the rates on overnight Federal Funds transactions with members of the Federal Reserve System arranged by Federal Funds brokers, as published for such day (or, if such day is not a Business Day, for the next preceding Business Day) by the Federal Reserve Bank of New York, or, if such rate is not so published for any day that is a Business Day, the average (rounded upwards, if necessary, to the next 1/100 ^th of 1%) of the quotations for such day on such transactions received by the Lender from three Federal Funds brokers of recognized standing selected by the Lender.

" GAAP " means generally accepted accounting principles in the United States of America as in effect from time to time.

" Governmental Authority " means any nation or government, any state or other political subdivision thereof, any agency, authority, instrumentality, regulatory body, court, global tribunal, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or global powers or functions of or pertaining to government.

" Indemnitees " has the meaning provided in Section 10.02 .

" Insolvency Event " means, with respect to any Person, (i) the commencement of a voluntary case by such Person under the Bankruptcy Code or the seeking of relief by such Person under any bankruptcy or insolvency or analogous law in any jurisdiction outside of the United States; (ii) the commencement of an involuntary case against such Person under the Bankruptcy Code and the petition is not controverted within 20 days, or is not dismissed within 60 days, after commencement of the case; (iii) a custodian (as defined in the Bankruptcy Code) is appointed for, or takes charge of, all or substantially all of the property of such Person; (iv) such Person commences (including by way of applying for or consenting to the appointment of, or the taking of possession by, a rehabilitator, receiver, custodian, trustee, conservator or liquidator (collectively, a " conservator ") of such Person or all or substantially all of its property) any other proceeding under any reorganization, arrangement, adjustment of debt, relief of debtors, dissolution, insolvency, liquidation, rehabilitation, conservatorship or similar law of any jurisdiction whether now or

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hereafter in effect relating to such Person; (v) any such proceeding of the type set forth in clause (iv) above is commenced against such Person to the extent such proceeding is consented to by such Person or remains undismissed for a period of 60 days; (vi) such Person is adjudicated insolvent or bankrupt; (vii) any order of relief or other order approving any such case or proceeding is entered; (viii) such Person suffers any appointment of any conservator or the like for it or substantially all of its property that continues undischarged or unstayed for a period of 60 days; (ix) such Person makes a general assignment for the benefit of creditors or generally does not pay its debts as such debts become due; or (x) any corporate (or similar organizational) action is taken by such Person for the purpose of effecting any of the foregoing.

" Interest Period " means, with respect to each Eurodollar Loan, a period of one, two, three or six months as selected by the Borrower; provided, however, that (i) the initial Interest Period for any Borrowing of such Eurodollar Loan shall commence on the date of such Borrowing (the date of a Borrowing resulting from a Conversion or Continuation shall be the date of such Conversion or Continuation) and each Interest Period occurring thereafter in respect of such Borrowing shall commence on the day on which the next preceding Interest Period expires; (ii) if any Interest Period begins on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period, such Interest Period shall end on the last Business Day of such calendar month; (iii) if any Interest Period would otherwise expire on a day that is not a Business Day, such Interest Period shall expire on the next succeeding Business Day; provided, however, that if any Interest Period would otherwise expire on a day that is not a Business Day but is a day of the month after which no further Business Day occurs in such month, such Interest Period shall expire on the next preceding Business Day; (iv) no Interest Period for any Eurodollar Loan may be selected that would end after the Revolving Facility Termination Date; and (v) if, upon the expiration of any Interest Period, the Borrower has failed to (or may not) elect a new Interest Period to be applicable to the respective Borrowing of Eurodollar Loans as provided above, the Borrower shall be deemed to have elected to Convert such Borrowing to Base Rate Loans effective as of the expiration date of such current Interest Period.

" Lender " has the meaning provided in the first paragraph of this Agreement.

" LIBOR Rate " shall mean, with respect to any Eurodollar Borrowing for any Interest Period therefor, the rate per annum equal to the arithmetic mean (rounded to the nearest 1/100th of 1%) of the offered rates for deposits in Dollars with a term comparable to such Interest Period that appears on Reuters Screen LIBOR01 (or such other page as may replace such page on such service for the purpose of displaying the rates at which Dollar deposits are offered by leading banks in the London interbank deposit market as designated by the Lender from time to time) at approximately 11:00 a.m., London, England time, on the second full Business Day preceding the first day of such Interest Period; provided, however , that (i) if no comparable term for an Interest Period is available, the LIBOR Rate shall be determined using the weighted average of the offered rates for the two terms most nearly corresponding to such Interest Period and (ii) if Reuters Screen LIBOR01 shall at any time no longer exist, "LIBOR Rate" shall mean, with respect to each day during each Interest Period pertaining to Eurodollar Borrowings comprising part of the same Borrowing, the rate per annum equal to the rate at which the Lender is offered deposits in Dollars at approximately 11:00 a.m., London, England time, two Business Days prior to the first day of such Interest Period in the London interbank market for delivery on the first day of such Interest Period for the number of days comprised therein and in an amount comparable to its portion of the amount of such Eurodollar Borrowing to be outstanding during such Interest Period.

" Lien " means any mortgage, pledge, security interest, hypothecation, encumbrance, lien or charge of any kind (including any agreement to give any of the foregoing, any conditional sale or other title retention agreement or any lease in the nature thereof).

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" Loan " means any Revolving Loan.

" Loan Documents " means this Agreement, the Note and the Control Agreements.

" Margin Stock " has the meaning provided in Regulation U.

" Market Value " means, with respect to any Collateral held in one or more of the Controlled Accounts as of any date, (i) with respect to cash, the amount thereof, and (ii) with respect to any other Collateral, the market value of such collateral (A) as determined by the Securities Intermediary, or (B) if the Securities Intermediary is unable to provide the Market Value with respect to any Collateral, as reasonably determined by the Lender in accordance with customary procedures of it or its Affiliates and reported in a writing delivered as soon as practicable to the Borrower; provided, however , that if the Lender is unable to make such determination, then the Market Value with respect to Collateral other than cash will be zero.

" Material Adverse Effect " means any or all of the following: (i) any material adverse effect on the business, operations, property, assets, liabilities, or financial condition or prospects of the Borrower or the Borrower and its Subsidiaries, taken as a whole; (ii) any material adverse effect on the ability of the Borrower to perform its obligations under any of the Loan Documents (other than pursuant to a force majeure event); (iii) any material adverse effect on the ability of the Borrower and its Subsidiaries, taken as a whole, to pay their liabilities and obligations as they mature or become due; or (iv) any material adverse effect on the validity, effectiveness or enforceability, as against the Borrower, of any of the Loan Documents.

" Maximum Rate " has the meaning provided in Section 10.18 .

" Minimum Borrowing Amount " means with respect to any Loan, $20,000,000, with minimum increments thereafter of $5,000,000.

" 1934 Act " means the Securities Exchange Act of 1934, as amended.

" Note " means a promissory note substantially in the form of Exhibit A .

" Notice of Borrowing " has the meaning provided in Section 2.04(b) .

" Notice of Continuation or Conversion " has the meaning provided in Section 2.07(b) .

" Notice Office " means the office of the Lender at 1900 East Ninth Street, Locator 2203, Cleveland, Ohio 44114, Attention: Belinda Williams (facsimile: (216) 222-0003), or such other office as the Lender may designate in writing to the Borrower from time to time.

" Obligations " means all amounts, indemnities and reimbursement obligations, direct or indirect, contingent or absolute, of every type or description, and at any time existing, owing by the Borrower to the Lender pursuant to the terms of this Agreement or any other Loan Document (including, but not limited to, interest and fees that accrue after the commencement by or against the Borrower of any insolvency proceeding, regardless of whether allowed or allowable in such proceeding or subject to an automatic stay under Section 362(a) of the Bankruptcy Code).

" Organizational Documents " means, with respect to any Person (other than an individual), such Person’s Articles (Certificate) of Incorporation, or equivalent formation documents, and Regulations

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(Bylaws), or equivalent governing documents, and, in the case of any partnership, includes any partnership agreement and any amendments to any of the foregoing.

" Outstanding Loan Obligation " means, as of any date, the aggregate principal amount of all Loans then outstanding hereunder, together with accrued interest.

" Passive Investor " means any Person who or which has acquired stock of the Borrower in the ordinary course of business for investment purposes only and not with the purpose or effect of changing or influencing the control of Borrower, as demonstrated by the filing by such Person of a statement on Schedule 13G (including amendments thereto) pursuant to Regulation 13D under the Securities Exchange Act of 1934, as long as such Person continues to hold such stock with such investment intent.

" Payment Office " means the office of the Lender at 1900 East Ninth Street, Locator 2203, Cleveland, Ohio 44114, Attention: Belinda Williams (facsimile: (216) 222-0003), or such other office(s), as the Lender may designate to the Borrower in writing from time to time.

" Permitted Purposes " means (i) emergency liquidity purposes for working capital upon the occurrence of a material and adverse disruption in financial markets due to a force majeure type of event or (ii) for liquidity purposes in the event of a disruption in the normal cash management or treasury operations of the Borrower, or any of the systems or facilities that support such operations, whether or not as a result of an event of the type described in item (i).

" Person " means any individual, partnership, joint venture, firm, corporation, limited liability company, association, trust or other enterprise or any government or political subdivision or any agency, department or instrumentality thereof.

" Regulation D " means Regulation D of the Board of Governors of the Federal Reserve System as from time to time in effect and any successor to all or a portion thereof establishing reserve requirements.

" Regulation U " means Regulation U of the Board of Governors of the Federal Reserve System as from time to time in effect and any successor to all or a portion thereof establishing margin requirements.

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

" Revolving Commitment " means $125,000,000 or such greater or lesser amount as shall be established in accordance with the terms of this Agreement.

" Revolving Facility " means the credit facility established under Section 2.02 pursuant to the Revolving Commitment.

" Revolving Facility Availability Period " means the period from the Closing Date until the Revolving Facility Termination Date.

" Revolving Facility Exposure " means, at any time, the sum of the principal amounts of all Revolving Loans made by the Lender and outstanding at such time.

" Revolving Facility Termination Date " means the earliest of (i) 364 days from the Closing Date, (ii) December 31, 2009 and (iii) the date that the Revolving Commitments have been terminated pursuant to Section 2.09 or Section 8.02 .

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" Revolving Loan " means any loan made by the Lender pursuant to Section 2.02 .

" SEC " means the United States Securities and Exchange Commission.

" Securities Account " has the meaning given to such term in the UCC.

" Securities Intermediary " means, with respect to the Controlled Securities Account, the securities intermediary (as defined in the UCC) with respect to the Controlled Securities Account.

" Security Documents " means any Control Agreement and any document pursuant to which any Lien is granted or perfected by the Borrower to the Lender as security for any of the Obligations.

" Statutory Reserves " shall mean, for any day during any Interest Period for any Eurodollar Borrowing, the average maximum percentage rate at which reserves (including any marginal, supplemental or emergency reserves) are required to be maintained, during such Interest Period under regulations issued from time to time (including "Regulation D," issued by the Board of Governors of the Federal Reserve Bank of the United States (the "Reserve Regulations")) by member banks of the United States Federal Reserve System in New York City with deposits exceeding one billion Dollars against Eurocurrency funding liabilities (currently referred to as "Eurocurrency liabilities" (as such term is used in Regulation D)). Eurodollar Borrowings shall be deemed to constitute Eurodollar liabilities and to be subject to such reserve requirements without benefit of or credit for proration, exceptions or offsets which may be available from time to time to the Lender under the Reserve Regulations.

" Subsidiary " of any Person means (i) any corporation more than 50% of whose stock of any class or classes having by the terms thereof ordinary Voting Power to elect a majority of the directors of such corporation (irrespective of whether or not at the time stock of any class or classes of such corporation shall have or might have Voting Power by reason of the happening of any contingency) is at the time owned by such Person directly or indirectly through Subsidiaries, and (ii) any partnership, limited liability company, association, joint venture or other entity in which such Person directly or indirectly through Subsidiaries, owns more than 50% of the Equity Interests of such Person at the time or in which such Person, one or more other Subsidiaries of such Person or such Person and one or more Subsidiaries of such Person, directly or indirectly, has the power to direct the policies, management and affairs thereof. Unless otherwise expressly provided, all references herein to "Subsidiary" shall mean a Subsidiary of the Borrower.

" Taxes " has the meaning provided in Section 3.03(a) .

" Total Credit Facility Amount " means the Revolving Commitment. As of the Closing Date, the Total Credit Facility Amount is $125,000,000.

" Type " means any type of Loan determined with respect to the interest option applicable thereto, which in each case shall be a Base Rate Loan or a Eurodollar Loan.

" UCC " means the Uniform Commercial Code as in effect from time to time. Unless otherwise specified, the UCC shall refer to the UCC as in effect in the State of Ohio.

" United States " and " U.S. " each means United States of America.

" USA Patriot Act " means the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT Act) Act of 2001.

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" Voting Power " means, with respect to any Person, the exclusive ability to control, through the ownership of shares of capital stock, partnership interests, membership interests or otherwise, the election of members of the board of directors or other similar governing body of such Person, and the holding of a designated percentage of Voting Power of a Person means the ownership of shares of capital stock, partnership interests, membership interests or other interests of such Person sufficient to control exclusively the election of that percentage of the members of the board of directors or similar governing body of such Person.

Section 1.02 Computation of Time Periods . In this Agreement in the computation of periods of time from a specified date to a later specified date, the word "from" means "from and including," the words "to" and "until" each means "to but excluding" and the word "through" means "through and including."

Section 1.03 Accounting Terms . Except as otherwise specifically provided herein, all terms of an accounting or financial nature shall be construed in accordance with GAAP, as in effect from time to time.

Section 1.04 Terms Generally . The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words "include," "includes" and "including" shall be deemed to be followed by the phrase "without limitation." The word "will" shall be construed to have the same meaning and effect as the word "shall." Unless the context requires otherwise, (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, restated, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (b) any reference herein to any Person shall be construed to include such Person’s successors and assigns, (c) the words "herein," "hereof" and "hereunder," and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (d) all references herein to Sections, Schedules and Exhibits shall be construed to refer to Sections of, and Schedules and Exhibits to, this Agreement, (e) the words "asset" and "property" shall be construed to have the same meaning and effect and to refer to any and all real property, tangible and intangible assets and properties, including cash, securities, accounts and contract rights, and interests in any of the foregoing, and (f) any reference to a statute, rule or regulation is to that statute, rule or regulation as now enacted or as the same may from time to time be amended, re-enacted or expressly replaced.

ARTICLE II.

THE TERMS OF THE CREDIT FACILITY

Section 2.01 Establishment of the Credit Facility . On the Closing Date, and subject to and upon the terms and conditions set forth in this Agreement and the other Loan Documents, the Lender agrees to establish the Credit Facility for the benefit of the Borrower; provided , however, that at no time will the Revolving Facility Exposure exceed the Total Credit Facility Amount.

Section 2.02 Revolving Facility . During the Revolving Facility Availability Period, the Lender agrees, on and subject to the terms and conditions set forth in this Agreement, to make a Revolving Loan or Revolving Loans to the Borrower, in such amounts as the Borrower may request from time to time pursuant to the Revolving Commitment, which Revolving Loans (i) may, except as set forth herein, at the option of the Borrower, be incurred and maintained as, or Converted into, Revolving Loans that are Base Rate Loans or Eurodollar Loans, provided that all Revolving Loans made as part of the

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same Borrowing shall consist of Revolving Loans of the same Type; (ii) may be repaid or prepaid and reborrowed, at the Borrower’s discretion, in accordance with the provisions hereof; and (iii) shall not be made if, after giving effect to any such Revolving Loan, (A) the Revolving Facility Exposure would exceed the Revolving Commitment or (B) the Borrower would be required to prepay Loans.

Section 2.03 Increase in Revolving Commitments . The Borrower may, by written notice to the Lender, request that the Total Credit Facility Amount be increased by an amount not to exceed $25,000,000 in the aggregate for all such increases from the Closing Date until the Revolving Facility Termination Date, provided that (i) no Default or Event of Default has occurred and is continuing at the time of such request and on the date of any such increase and (ii) after giving effect to such increase, the aggregate value of all Collateral shall be greater than or equal to 105% of the Outstanding Loan Obligation. The Borrower shall set forth in each such request the amount of the requested increase in the Total Credit Facility Amount (which amount shall be in minimum increments of at least $1,000,000 and a minimum amount of at least $5,000,000) and the date on which such increase is requested to become effective (which shall be not less than ten (10) Business Days nor more than 60 days after the date of such notice and that, in any event, must be at least ninety (90) days prior to the Revolving Facility Termination Date). Any such increase shall be made in the sole discretion of the Lender.

Section 2.04 Notice of Borrowing .

(a) Time of Notice . Each Borrowing of a Loan (other than a Continuation or Conversion) shall be made upon notice in the form provided for below which shall be provided by the Borrower to the Lender at its Notice Office not later than (i) in the case of each Borrowing of a Eurodollar Loan, 11:00 A.M. (local time at its Notice Office) at least three (3) Business Days’ prior to the date of such Borrowing, and (ii) in the case of each Borrowing of a Base Rate Loan, prior to 2:30 P.M. (local time at its Notice Office) on the proposed date of such Borrowing.

(b) Notice of Borrowing . Each request for a Borrowing (other than a Continuation or Conversion) shall be made by an Authorized Officer of the Borrower by delivering written notice of such request substantially in the form of Exhibit B-1 hereto (each such notice, a " Notice of Borrowing ") or by telephone (to be confirmed immediately in writing by delivery by an Authorized Officer of the Borrower of a Notice of Borrowing), and in any event each such request shall be irrevocable and shall specify (i) the aggregate principal amount of the Loans to be made pursuant to such Borrowing, (ii) the date of the Borrowing (which shall be a Business Day), (iii) the Type of Loans such Borrowing will consist of, and (iv) if applicable, the initial Interest Period. Without in any way limiting the obligation of the Borrower to confirm in writing any telephonic notice permitted to be given hereunder, the Lender may act prior to receipt of written confirmation without liability upon the basis of such telephonic notice believed by the Lender in good faith to be from an Authorized Officer of the Borrower entitled to give telephonic notices under this Agreement on behalf of the Borrower. In each such case, the Lender’s record of the terms of such telephonic notice shall be conclusive absent manifest error.

(c) Minimum Borrowing Amount . The aggregate principal amount of each Borrowing by the Borrower shall not be less than the Minimum Borrowing Amount.

(d) Maximum Borrowings . More than one Borrowing may be incurred by the Borrower on any Business Day; provided, however, that (i) if there are two or more Borrowings on a single Business Day by the Borrower that consist of Eurodollar Loans, each such Borrowing shall have a different initial Interest Period, and (ii) at no time shall there be more than four (4) Borrowings of Eurodollar Loans outstanding hereunder.

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Section 2.05 Evidence of Obligations .

(a) Loan Accounts . The Lender shall maintain accounts in which it shall record (i) the amount of each Loan and Borrowing made hereunder, the Type thereof, the Interest Period and applicable interest rate, (ii) the amount of any principal due and payable or to become due and payable from the Borrower, and (iii) the other details relating to the Loans and other Obligations.

(b) Effect of Loan Accounts, etc . The entries made in the accounts maintained pursuant to Section 2.05(a) shall be prima facie evidence of the existence and amounts of the Obligations recorded therein; provided , that the failure of the Lender to maintain such accounts or any error (other than manifest error) therein shall not in any manner affect the obli