Exhibit 10.1

SECOND AMENDMENT TO
AMENDED AND RESTATED LETTER OF CREDIT
REIMBURSEMENT AND PLEDGE AGREEMENT

Dated as of May 26, 2005

among

MONTPELIER REINSURANCE LTD.,

MONTPELIER RE HOLDINGS LTD.

THE LENDERS PARTY HERETO

and

BANK OF AMERICA, N.A.,

as Administrative Agent for itself and the
other lending institutions party hereto

--------------------------------------------------------------------------------

Banc of America Securities LLC
as Sole Lead Arranger and Book Manager

 

--------------------------------------------------------------------------------

 

SECOND AMENDMENT TO AMENDED AND RESTATED

LETTER OF CREDIT REIMBURSEMENT AND PLEDGE AGREEMENT

     THIS SECOND AMENDMENT TO AMENDED AND RESTATED LETTER OF CREDIT
REIMBURSEMENT AND PLEDGE AGREEMENT, dated as of May 26, 2005 (this “Amendment”),
amends the Amended and Restated Letter of Credit Reimbursement and Pledge
Agreement, dated as of May 27, 2004 (as amended to date, the “Credit
Agreement”), among MONTPELIER REINSURANCE LTD., MONTPELIER RE HOLDINGS LTD., the
various financial institutions parties thereto (collectively, the “Lenders”) and
BANK OF AMERICA, N.A., as administrative agent (the “Administrative Agent”) for
the Lenders. Terms defined in the Credit Agreement are, unless otherwise defined
herein or the context otherwise requires, used herein as defined therein.

     WHEREAS, the parties hereto have entered into the Credit Agreement, which
provides for the Lenders to extend certain credit facilities to the Borrowers
from time to time; and

     WHEREAS, the parties hereto desire to amend the Credit Agreement to extend
the Tranche A Commitment Date thereunder;

     NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration (the receipt and sufficiency of which are hereby
acknowledged), the parties hereto agree as follows:

     SECTION 1. AMENDMENT. Effective as of May 26, 2005, clause (a) of the
definition of “Tranche A Commitment Termination Date” is amended in its entirety
to read as follows: “(a) May 25, 2006 and”.

     SECTION 2. CONDITIONS PRECEDENT. This Amendment shall become effective when
each of the conditions precedent set forth in this Section 2 shall have been
satisfied, and notice thereof shall have been given by the Administrative Agent
to the Borrowers and the Lenders.

     2.1 Receipt of Documents. The Administrative Agent shall have received this
Amendment, duly executed by the Borrowers, the Administrative Agent and the
Tranche A Lenders increasing their Commitments.

     2.2 Compliance with Warranties, No Default, etc. Both before and after
giving effect to the effectiveness of this Amendment, the following statements
by the Borrowers shall be true and correct (and each Borrower, by its execution
of this Amendment, hereby represents and warrants to the Administrative Agent
and each Lender that such statements are true and correct as at such times):

     (a) the representations and warranties set forth in Article 5 of the Credit
Agreement shall be true and correct with the same effect as if then made (unless
stated to relate solely to an earlier date, in which case such representations
and warranties shall be true and correct as of such earlier date); and

 

--------------------------------------------------------------------------------

 

     (b) no Event of Default or Default shall have then occurred and be
continuing.

     SECTION 3. REPRESENTATIONS AND WARRANTIES. To induce the Lenders and the
Administrative Agent to enter into this Amendment, each Borrower hereby
represents and warrants to the Administrative Agent and each Lender as follows:

     3.1 Due Authorization, Non-Contravention, etc. The execution, delivery and
performance by such Borrower of this Amendment are within such Borrower’s
corporate powers, have been duly authorized by all necessary corporate action,
and do not

     (a) contravene such Borrower’s Governing Documents;

     (b) contravene any contractual restriction, law or governmental regulation
or court decree or order binding on or affecting such Borrower; or

     (c) result in, or require the creation or imposition of, any Lien on any of
such Borrower’s properties.

     3.2 Government Approval, Regulation, etc. No authorization or approval or
other action by, and no notice to or filing with, any governmental authority or
regulatory body or other Person is required for the due execution, delivery or
performance by such Borrower of this Amendment.

     3.3 Validity, etc. This Amendment constitutes the legal, valid and binding
obligation of such Borrower enforceable in accordance with its terms.

     SECTION 4. MISCELLANEOUS.

     4.1 Continuing Effectiveness, etc. This Amendment shall be deemed to be an
amendment to the Credit Agreement, and the Credit Agreement, as amended hereby,
shall remain in full force and effect and is hereby ratified, approved and
confirmed in each and every respect. After the effectiveness of this Amendment
in accordance with its terms, all references to the Credit Agreement in the Loan
Documents or in any other document, instrument, agreement or writing shall be
deemed to refer to the Credit Agreement as amended hereby.

     4.2 Payment of Costs and Expenses. The Borrowers, jointly and severally,
agree to pay on demand all expenses of the Administrative Agent (including the
fees and out-of-pocket expenses of counsel to the Administrative Agent) in
connection with the negotiation, preparation, execution and delivery of this
Amendment.

     4.3 Severability. Any provision of this Amendment which is prohibited or
unenforceable in any jurisdiction shall, as to such provision and such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions of this Amendment
or affecting the validity or enforceability of such provision in any other
jurisdiction.

2

--------------------------------------------------------------------------------

 

     4.4 Headings. The various headings of this Amendment are inserted for
convenience only and shall not affect the meaning or interpretation of this
Amendment or any provisions hereof.

     4.5 Execution in Counterparts. This Amendment may be executed by the
parties hereto in several counterparts, each of which shall be deemed to be an
original and all of which shall constitute together but one and the same
agreement.

     4.6 Governing Law. THIS AMENDMENT SHALL BE DEEMED TO BE A CONTRACT MADE
UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK.

     4.7 Successors and Assigns. This Amendment shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors and
assigns.

3

--------------------------------------------------------------------------------

 

     IN WITNESS WHEREOF, the undersigned have duly executed this Second
Amendment to Amended and Restated Letter Of Credit Reimbursement and Pledge
Agreement as of the date first set forth above.

            MONTPELIER REINSURANCE LTD.
      By:   /s/ NEIL MCCONACHIE       Name:   Neil McConachie      Title:  
Treasurer and Chief Accounting Officer     

            MONTPELIER RE HOLDINGS LTD.
      By:   /s/ NEIL MCCONACHIE       Name:   Neil McConachie      Title:  
Treasurer and Chief Accounting Officer     

S-1

--------------------------------------------------------------------------------

 

            BANK OF AMERICA, N.A., individually as a Tranche A Lender and as
Administrative Agent and as Issuing Bank
      By:   /s/ TIMOTHY CASSIDY       Name:   Timothy Cassidy      Title:   Vice
President     

S-2

--------------------------------------------------------------------------------

 

            FLEET NATIONAL BANK, as Issuing Bank
      By:   /s/ TIMOTHY CASSIDY       Name:   Timothy Cassidy      Title:   Vice
President     

S-3

--------------------------------------------------------------------------------

 

            JP MORGAN CHASE BANK, N.A. (f/k/a) BANK ONE, NA, as Tranche A Lender
        By:   /s/ HELEN L. NEWCOMB       Name:   Helen L. Newcomb      Title:  
Vice President     

S-4

--------------------------------------------------------------------------------

 

            BARCLAYS BANK PLC, as Tranche A Lender
      By:   /s/ RICHARD ASKEY       Name:   Richard Askey      Title:   Director
- Insurance     

S-5

--------------------------------------------------------------------------------

 

            CREDIT SUISSE FIRST BOSTON, ACTING THROUGH ITS CAYMAN ISLANDS
BRANCH, as Tranche A Lender
      By:   /s/ JAY CHALL       Name:   Jay Chall      Title:   Director   

                  By:   /s/ MIKHAIL FAYBUSOVICH       Name:   Mikhail
Faybusovich      Title:   Associate   

S-6

--------------------------------------------------------------------------------

 

            HSBC BANK USA, NATIONAL ASSOCIATION, as Tranche A Lender
      By:   /s/ LAWRENCE M. KARP       Name:   Lawrence M. Karp      Title:  
Senior Vice President   

S-7

--------------------------------------------------------------------------------

 

            ING BANK N.V., LONDON BRANCH, as Tranche A Lender
      By:   /s/ M.E.R. SHARMAN       Name:   M.E.R. Sharman      Title:  
Managing Director   

                  By:   /s/ N.J. MARCHANT       Name:   N.J. Marchant     
Title:   Director   

S-8

--------------------------------------------------------------------------------

 

            ROYAL BANK OF SCOTLAND PLC, as Tranche A Lender
      By:   /s/ RICHARD KERTON       Name:   Richard Kerton      Title:  
Relationship Director     

S-9