**Exhibit 10.42****Amendment Number 1 to Investment Agreement**This Amendment Number 1 (“Amendment”) to the Investment Agreement (“Agreement”) dated as of October1, 2002, between United States Fire Insurance Company and Hamblin Watsa Investment Counsel Ltd. andFairfax Financial Holdings Limited is effective as of April 1, 2007. 1. Capitalized terms used herein but not defined herein shall have the meanings ascribedto them in the Agreement.  2. The last sentence of Section 2 of the Agreement is hereby amended to read in itsentirety as follows:The investment guidelines shall at all times be in compliance with theinvestment statutes of the Delaware Insurance Code. 3. Section 3A(e) of the Agreement is hereby amended to read in its entirety asfollows:Such transactions between affiliated companies must comply with the priorapproval or reporting requirements of the Delaware Insurance Code. 4. The second sentence of Section 10 of the Agreement is hereby amended to read in itsentirety as follows:Attached hereto as Schedule C is a copy of the current fee scheduleand FFH agrees to give us thirty (30) days prior written notice of anychange in such schedule, which change shall comply with the prior approvalor reporting requirements of the Delaware Insurance code. 5. Section 17 of the Agreement is hereby amended to read in its entirety as follows:This Agreement, including the schedules attached hereto and made a parthereof, may only be amended by written agreement signed by the parties andmust comply with the prior approval or reporting requirements of theDelaware Insurance Code; provided, however, that any amendment toSchedule A may become effective without the prior approval of theDelaware Department of Insurance, provided that such amendment shall befiled with the Delaware Department of Insurance not later than its effectivedate and shall, if disapproved by the Delaware Department of Insurance, bevoid as of the date of such disapproval. 6. Section 2, Governing Laws: Jurisdiction: Service of Process, of Schedule D of theAgreement is hereby amended to read in its entirety as follows:This Agreement shall be governed and construed in accordance with the lawsof Delaware, our state of domicile. Each of the parties thereto submits tothe jurisdiction of the state and federal courts of Delaware, in any actionor proceeding arising out of or relating to this Agreement and all claims inrespect of any such action or proceeding may be heard or determined in anysuch court; and service of process, notices and demands of such courts maybe made upon you by personal service to the person and at the addresscontained in Section 1 above as such person or address may be changed fromtime to time. 7. Section 3, Insurance Department Approval, of Schedule D of the Agreement is herebyamended to read in its entirety as follows:This Agreement may be subject to the non-disapproval or approval of theDelaware Department of Insurance, and such terms and conditions hereof asmay be required by the Delaware Department of Insurance to be altered oramended shall be deemed acceptable to the parties hereto, to the extent sameshall not change the substance and intent of this Agreement. 8. Section 4, Inspection of Records, of Schedule D of the Agreement is hereby amended toread in its entirety as follows:You and we and the duly authorized representatives of each of us shall, atall reasonable times, each be permitted access to all relevant books andrecords of the other pertaining to this Agreement. You and your dulyauthorized representatives shall provide to the Delaware Department ofInsurance, within fifteen (15) days of any request from the DelawareDepartment of Insurance therefor, copies of all your books and records asthey pertain to us (or any portion thereof as may be specificallyrequested). 9. Schedule A is hereby amended to read in its entirety as attached hereto inExhibit A.  10. Unless specifically modified in this Amendment, all other terms and conditionscontained in the Agreement shall remain in full force and effect.
 

 
**IN WITNESS WHEREOF**, the parties hereto have caused their duly authorized officers to execute thisAmendment as of the date written below.         Hamblin Watsa Investment Counsel Ltd.     Crum & Forster Indemnity Company           By:/s/ Paul Rivett     By: /s/ Dennis J. Hammer           Authorized Signature