THIRD AMENDMENT

Exhibit 10.1

THIRD AMENDMENT

THIRD AMENDMENT (this “Amendment”), dated as of May 12, 2006 among MBIA INC. (“Parent”), a Connecticut corporation, MBIA INSURANCE CORPORATION (“Corp.”), a New York stock insurance corporation, the Designated Borrowers party to the Credit Agreement referred to below, the undersigned lenders party to the Credit Agreement (each, a “Continuing Lender” and, collectively, the “Continuing Lenders”), each lender that shall become a “Lender” under the Credit Agreement upon the effectiveness of this Amendment (each, a “New Lender” and, collectively, the “New Lenders”) and BARCLAYS BANK PLC, as Administrative Agent (in such capacity, the “Administrative Agent”). Unless otherwise defined herein, capitalized terms used herein and defined in the Credit Agreement referred to below are used herein as so defined.

W I T N E S S E T H :

WHEREAS, the undersigned are party to a Second Amended and Restated Credit Agreement, dated as of August 28, 1998 and amended and restated as of April 19, 2002 and further amended and restated as of April 16, 2003, among Parent, Corp., the Designated Borrowers, the Administrative Agent, the Lenders party thereto from time to time, Bank of America, N.A., as Syndication Agent, KeyBank National Association, JPMorgan Chase Bank and The Bank of New York, as Co-Documentation Agents, Barclays Capital, as Sole Bookrunner, and Barclays Capital and Banc of America Securities LLC, as Joint Lead Arrangers (as same has been further amended, restated, modified and/or supplemented to, but not including, the date hereof, the “Credit Agreement”); and

WHEREAS, subject to the terms and conditions set forth below, the parties hereto wish to amend the Credit Agreement as provided herein;

NOW, THEREFORE, it is agreed;

1. Section 1.15 of the Credit Agreement is hereby amended by deleting the text “Second Amendment Effective Date” and inserting the text “Third Amendment Effective Date” in lieu thereof.

2. Section 4.02(c) of the Credit Agreement is hereby amended by inserting the text “(except for the representations and warranties set forth in Section 5.04(b) herein concerning whether there has been any event, act condition or occurrence having a Material Adverse Effect)” immediately following the text “Credit Documents” appearing in clause (ii) of said Section.

3. Section 5.04(a) of the Credit Agreement is hereby further amended by deleting the text “December 31, 2004” and inserting the text “December 31, 2005” in lieu thereof.

4. Section 5.04(b) of the Credit Agreement is hereby further amended by deleting the text “December 31, 2004” and inserting the text “December 31, 2005” in lieu thereof.

5. Section 5.07 of the Credit Agreement is hereby further amended by deleting the text “December 31, 2004” and inserting the text “December 31, 2005” in lieu thereof.

6. Section 9 of the Credit Agreement is hereby amended by deleting the definition of “Applicable Margin” in its entirety and inserting the following new definition of “Applicable Margin” in lieu thereof:

“ “Applicable Margin” shall mean, as of any date, with respect to (i) any Eurodollar Loan, Base Rate Loan, or Swingline Loan, a percentage per annum set forth below under the caption “Eurodollar Rate”, “Base Rate” or “Swing Rate”, as applicable, determined, in each case, by reference to (x) for Revolving Loans and Swingline Loans incurred by Parent, the Applicable Public Rating in effect on such date as set forth below under the caption “Parent’s Public Rating S&P/Moody’s” and (y) for Revolving Loans and Swingline Loans incurred by Corp. or a Designated Borrower, the Applicable Public Rating in effect on such date as set forth below under the caption “Corp’s Public Rating S&P/Moody’s” and (ii) any Facility Fee, the Applicable Margin per annum set forth below under the caption “Facility Fee” determined, in each case, by reference to the lower of Parent’s and Corp.’s Applicable Public Rating in effect on such date as set forth below under the captions “Parent’s Public Rating S&P/Moody’s” and “Corp’s Public Rating S&P/Moody’s” respectively:

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provided that, (A) notwithstanding anything to the contrary set forth in the grid above (and notwithstanding the Applicable Public Rating at the time), upon the occurrence and during the continuance of any Event of Default, the Applicable Margin shall be the rate described above in Level 4; (B) for purposes of the foregoing, in the event of a split in the Applicable Public Rating from Moody’s and S&P, the applicable level shall be (1) the lower of such ratings in the event such ratings are one level apart, (2) the midpoint (if any) of such levels in the event such ratings are two or more levels apart and (3) the lower of the two intermediate ratings in the event there is no midpoint rating; (C) if at any time Parent or Corp., as the case may be, does not have an Applicable Public Rating with either Moody’s or S&P (other than by reason of the circumstances referred to in the last sentence of this definition), the Applicable Margin as set forth in Level 4 will apply; (D) if at any time either Moody’s or S&P shall not have in effect an Applicable Public Rating, the Applicable Margin shall be determined solely by the Applicable Public Rating established by the rating agency that does have an Applicable Public Rating then in effect; and (E) if at any time the Applicable Public Ratings established or deemed to have been established by Moody’s and S&P shall be changed (other than as a result of a change in the rating system of Moody’s or S&P), such change shall be effective as of the date on which it is first announced by the applicable rating agency. Each change in the Applicable Margin shall apply during the period commencing on the effective date of such change and ending on the date immediately preceding the effective date of the next such change. If the rating system of Moody’s or S&P shall change, or if either such rating agency shall cease to be in the business of providing the Applicable Public Rating, Parent (on its own behalf and/or on behalf of Corp.) and the Lenders shall negotiate in good faith to amend this definition to reflect such changed rating system or the unavailability of ratings from such rating agency and, pending the effectiveness of any such amendment, the Applicable Margin shall be determined by reference to the rating most recently in effect prior to such change or cessation.”

7. Section 9 of the Credit Agreement is hereby further amended by deleting the definition of “Final Maturity Date” in its entirety and inserting the following new definition of “Final Maturity Date” in lieu thereof:

“Final Maturity Date” shall mean May 12, 2011, or such later date to which the Final Maturity Date shall have been extended pursuant to Section 1.15.

8. Section 9 of the Credit Agreement is hereby further amended by inserting in the appropriate alphabetical order the following new definition:

“Third Amendment Effective Date” shall have the meaning provided in that certain Third Amendment, dated as of May 12, 2006, among Parent, Corp., the Designated Borrowers, the Lenders and the Administrative Agent.

9. The Credit Agreement is hereby further amended by deleting Annex I to the Credit Agreement in its entirety and replacing it with Annex I attached hereto.

10. The Credit Agreement is hereby further Amended by deleting Annex II to the Credit Agreement in its entirety and replacing it with Annex II attached hereto.

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1. In order to induce the Lenders to enter into this Amendment, each of Parent and Corp. hereby represents and warrants that (i) the representations and warranties of each of Parent and Corp. contained in the Credit Agreement and each other Credit Document are true and correct in all material respects on and as of the Third Amendment Effective Date (as defined below) (except with respect to any representations and warranties limited by their terms to a specific date, which shall be true and correct in all material respects as of such date) after giving effect to this Amendment and (ii) as of the date hereof, there exists no Default or Event of Default under the Credit Agreement after giving effect to this Amendment.

2. This Amendment is limited as specified and shall not constitute an amendment, modification, acceptance or waiver of any other provision of the Credit Agreement or any other Credit Document.

3. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK.

4. This Amendment shall become effective on the date (the “Third Amendment Effective Date”) when (i) each Borrower, each Continuing Lender and each New Lender shall have signed a counterpart hereof (whether the same or different counterparts) and shall have delivered (including by way of telecopier) the same to the Administrative Agent, (ii) there shall have been delivered to the Administrative Agent for the account of each Lender requesting the same, the appropriate Notes, in each case, executed by Parent and Corp., as applicable, and in each case in the amount, maturity and as otherwise provided in the Credit Agreement, (iii) (x) all accrued and unpaid interest on all Loans of each Lender that is neither a Continuing Lender nor a New Lender (each such Lender, a “Non-Continuing Lender” and, collectively, the “Non-Continuing Lenders”) shall have been paid in full (regardless of whether or not the Credit Agreement otherwise requires a payment of such interest at such time), (y) all fees, costs and expenses owing to each Non-Continuing Lender under the Credit Agreement shall have been paid in full and (z) the principal of all outstanding Loans (if any) of each Non-Continuing Lender shall have been repaid in full and (iv) on the Third Amendment Effective Date, the Borrowers shall have, or shall have caused to be, paid in full to the Administrative Agent all costs, expenses (including, without limitation, all reasonable legal fees and expenses) payable to the Administrative Agent, in each case, to the extent then due.

5. The parties hereby agree that on the Third Amendment Effective Date (i) each New Lender shall be a “Lender” under, and as defined in, the Credit Agreement and be bound by the terms thereof as a Lender and (ii) the Commitment of each Non-Continuing Lender (as in effect immediately prior to the Third Amendment Effective Date) shall be terminated and such Non-Continuing Lender shall cease for all purposes (other than with respect to indemnities contained in the Credit Documents which survive such termination) to constitute a Lender.

6. From and after the Third Amendment Effective Date, all references in the Credit Agreement and in the other Credit Documents shall be deemed to be referenced to the Credit Agreement as modified hereby.

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IN WITNESS WHEREOF, the undersigned have caused this Amendment to be duly executed and delivered as of the date first above written.

ANNEX I

COMMITMENTS