Document:

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                                                                    EXHIBIT 10.2

July 23, 2002

James F. Dore

                  Re: Consulting and Separation Agreement

Dear Jim:

This consulting and separation agreement (this "Letter Agreement") confirms your
retirement and the resulting termination of your status as an officer, director
and employee of and with PXRE Group Ltd. (the "Company"), and each of the
Company's direct and indirect subsidiaries (including, without limitation, PXRE
Reinsurance Company), such retirement and termination to be effective upon
September 30, 2002 (the "Retirement Date"). In order to be eligible to receive
the benefits set forth in Section 4 of this Letter Agreement, you must execute
it no later than August 14, 2002.

For good and valuable consideration, the receipt of which is hereby
acknowledged, you and the Company mutually agree as follows:

1.       Retirement and Resignation as Employee, Officer and Director. Your
         execution of this Letter Agreement hereby confirms in writing your
         desire to retire and terminate your status as an employee, director and
         officer of the Company and any and all of its subsidiaries, effective
         as of the Retirement Date.

2.       Retirement Benefits. Pursuant to the various benefit plans of the
         Company and its subsidiaries, as a result of your retirement, this will
         confirm that you are entitled to the following benefits, subject, in
         each case, to applicable statutory deductions and withholdings:

         (a)      Incentive Plan. Pursuant to, and subject to the terms of, the
                  1992 Officer Incentive Plan:

                  i)       All following Non-Qualified Options and Restricted
                           Shares (as such terms are defined in such plan) will
                           immediately vest upon the Retirement Date:

---------------------- -------------------- ------------------------
  Type of Security      No. of Securities      Date of Grant
---------------------- -------------------- ------------------------
Non-Qualified Options        25,000              2/08/2000
---------------------- -------------------- ------------------------
Non-Qualified Options        26,250              2/12/2001
---------------------- -------------------- ------------------------
Non-Qualified Options        40,000             12/10/2001
---------------------- -------------------- ------------------------
Non-Qualified Options        35,000              2/12/2002
---------------------- -------------------- ------------------------
  Restricted Shares           2,500              2/08/2000
---------------------- -------------------- ------------------------
  Restricted Shares           7,500              2/12/2001
---------------------- -------------------- ------------------------

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                  ii)      All of the foregoing Non-Qualified Options and any
                           Non-Qualified Options that vested prior to the date
                           of this Letter Agreement may be exercised by you at
                           any time between the Retirement Date and the third
                           anniversary date of the Retirement Date.

         (b)      Bonus Plan. Pursuant to, and subject to the terms of, the
                  Restated Employee Annual Incentive Bonus Plan, you will be
                  entitled to receive 9/12ths of the Cash and Restricted Share
                  Bonuses (as defined and calculated under such plan) payable to
                  Executive Vice Presidents under such plan with respect to the
                  2002 fiscal year, provided that, as a result of your
                  retirement, the Restricted Share Bonus, if any, shall be
                  payable in cash rather than Restricted Shares. In accordance
                  with, and subject to terms of, the Restated Employee Annual
                  Incentive Bonus Plan, any bonuses payable thereunder shall be
                  paid to you no later than February 28, 2003.

         (c)      Employee Stock Purchase Plan. In accordance with the terms of
                  the Employee Stock Purchase Plan, your account balance under
                  such plan will be applied to purchase Shares at the Option
                  Price on July 1, 2002, the last Exercise Date (as such terms
                  are defined thereunder). Any remaining balance in your account
                  under such plan will be refunded and all payroll deductions
                  will cease as of July 1, 2002.

         (d)      Pension Plan. Given your length of service with the Company,
                  you are not entitled to receive any benefits under the PXRE
                  Reinsurance Company Retirement Plan.

         (e)      401 K Plan. Pursuant to the terms of the PXRE Reinsurance
                  Company 401(k) Plan, you are fully vested in all employer
                  contributions made by the Company to your account maintained
                  thereunder as a result of your length of service. Please
                  consult with Linda Clauser to discuss the various options
                  available to you for maintenance or distribution of your
                  401(k) account.

         (f)      SERP. Pursuant to, and subject to the terms of, the PXRE
                  Reinsurance Company Supplemental Executive Retirement Plan
                  ("SERP"), you are not entitled to any Supplemental Plan
                  Benefits under Part B of the SERP due to insufficient Years of
                  Credited Service. You are, however, entitled to receive an
                  amount equal to the full amount of your Participant's Account
                  under Part C of the SERP, including any Employer Contributions
                  made pursuant to Section 6.2 of the SERP. Pursuant to Section
                  6.4(a) of the Plan, you have elected to receive such amount in
                  a lump sum payable upon the Retirement Date.

3.       Consulting Services. From the Retirement Date until September 30, 2003
         (the "Consulting Period"), you agree to make yourself available for
         consultation with the Company and its subsidiaries to provide, as
         requested, advice and information with respect to the business of the
         Company and its subsidiaries, especially with respect to the Company's
         financial affairs. You shall be entitled to a cash payment in the
         amount of $15,000 per month, payable monthly during the Consulting
         Period.

                                       2
<PAGE>

4.       Additional Payments and Benefits. In addition to the retirement related
         benefits under Section 2, you shall be entitled to the following
         payments and benefits, subject, in each case, to applicable statutory
         deductions and withholdings. Your right to receive and retain these
         payments and benefits shall be subject to your material compliance with
         the terms of this Letter Agreement (including, but not limited to,
         Sections 7 and 8 hereof).

         (a)      Upon the Retirement Date, you shall be paid the $90,000
                  retention bonus that would have been payable to you on January
                  31, 2003 pursuant to the Retention Bonus Letter Agreement
                  dated as of December 12, 2001 if you had remained in the
                  Company's employ until January 31, 2003.

         (b)      If any Cash and Restricted Share Bonuses are payable pursuant
                  to the Restated Employee Annual Incentive Bonus Plan with
                  respect to the 2002 fiscal year, you will be entitled to
                  receive the remaining 3/12ths of the Cash and Restricted Share
                  Bonuses (as defined and calculated under such plan) payable to
                  Executive Vice Presidents under such plan that would not be
                  otherwise be payable to you under such plan due to your
                  retirement, provided that, as a result of your retirement, the
                  Restricted Share Bonus, if any, shall be payable in cash
                  rather than Restricted Shares. Such bonuses, if payable, shall
                  be paid to you no later than February 28, 2003.

         (c)      The balance due from you to PXRE Reinsurance Company under the
                  Promissory Note dated September 13, 2001 will be forgiven on
                  the Retirement Date.

5.       Cessation of all other Compensation and Benefits. From and after the
         Retirement Date, and except as otherwise expressly set forth in this
         Letter Agreement, you will not receive compensation, payments or
         benefits of any kind from the Company or its subsidiaries, and you
         expressly acknowledge and agree that, except with respect to the
         payments and benefits specifically set forth in this Letter Agreement,
         you are not entitled to any compensation, payment or benefit
         whatsoever, including, without limitation, any right to payment under
         Amended and Restated Severance Plan for Certain Executives of PXRE
         Group Ltd.

6.       Payment is in Consideration of Release and Other Continuing
         Obligations. You understand and agree that the payments provided for in
         Section 4 of this Letter Agreement are being provided to you in
         consideration for your acceptance and execution of, and in reliance
         upon your agreements in, this Letter Agreement, including but not
         limited to the release contained herein.

7.       Non-Disparagement. You agree that you will not, directly or indirectly,
         disparage (whether in writing or orally) the Company or the Releasees
         (as defined below) in any manner whatsoever at any time.

                                       3
<PAGE>

8.       Confidential Information. Except as may be required by the lawful order
         of a court or agency of competent jurisdiction, or except to the extent
         that you have express authorization from the Company, you hereby agree
         to keep secret and confidential indefinitely all non-public information
         (including, without limitation, information regarding any pending or
         threatened litigation, arbitrations or disputes) concerning the Company
         or its subsidiaries which was acquired by or disclosed to you during
         the course of your employment with the Company and its subsidiaries, or
         during the course of your consultation with the Company following your
         retirement, and to not to disclose same, either directly or indirectly,
         to any other person, firm or business entity, or use it in any way. To
         the extent that you obtained information on behalf of the Company or
         its Subsidiaries that may be subject to attorney-client privilege as to
         the Company's attorneys, you agree to take reasonable steps to maintain
         the confidentiality of such information and to preserve such privilege.

9.       Release.

                  You hereby agree to accept the compensation, payments and
         benefits provided for in Section 4 hereof in full resolution and
         satisfaction of, and hereby IRREVOCABLY AND UNCONDITIONALLY RELEASE,
         REMISE AND FOREVER DISCHARGE the Company, its past, present and future
         direct and indirect parents, subsidiaries, affiliates, divisions,
         predecessors, successors, and assigns, and their respective current and
         former officers, directors, shareholders, representatives, agents and
         employees, in their official and individual capacities, jointly and
         individually (the "Releasees") from, any and all agreements, promises,
         liabilities, claims and demands of any kind whatsoever, in law or
         equity, whether known or unknown, suspected or unsuspected, fixed or
         contingent, apparent or concealed, which you, your respective heirs,
         executors, administrators, successors or assigns ever had, now have or
         in the future may have, including, without limitation, any and all
         claims arising out of or relating to your employment, your compensation
         and benefits with the Company and/or the termination thereof, your
         status as a stockholder of the Company and any and all contract, tort
         or fraud claims, claims for defamation or other personal injury, claims
         under any federal, state or municipal wage payment, discrimination or
         fair employment practices law, statute or regulation and claims for
         costs, expenses and attorneys' fees with respect thereto, arising from
         the beginning of the world through the effective date of this Letter
         Agreement, in each case, against the Company or any of the Releasees,
         other than any claims with respect to the Company's breach of this
         Letter Agreement. However, it is agreed that you do not waive your
         rights for coverage or indemnification under any directors & officers
         policy, or pursuant to the certificate of incorporation or the by-laws
         of the Company for acts or omissions occurring during your employment.
         THIS RELEASE AND WAIVER INCLUDES, WITHOUT LIMITATION, ANY AND ALL
         CLAIMS UNDER THE AGE DISCRIMINATION IN EMPLOYMENT ACT, 29 U.S.C.
         Section 621-634 (the "ADEA").

                  You represent and warrant as of the date hereof (i) that you
         have not filed any claim or demand for relief against the Company or
         Releasees, (ii) that there are no outstanding claims, or other claims
         or demands for relief within the meaning of this Section 9, and (iii)
         that there has been no assignment of any such claims.

10.      Future Cooperation. You agree that upon the Company's reasonable
         request (whether during or after the Consulting Period), you will use
         reasonable efforts to assist and cooperate with the Company and the
         Releasees in connection with the defense or prosecution of any claim
         that may be made against or by the Company or the Releasees, or in
         connection with any ongoing or future investigation or dispute or claim
         of any kind involving the Company or the Releasees, including any
         proceeding before any arbitral, administrative, regulatory,
         self-regulatory, judicial, legislative, or other body or agency. You
         will not be paid any additional amounts for any assistance that you
         provide, although you will be entitled to reimbursement for reasonable
         out-of-pocket expenses.

                                       4
<PAGE>

11.      Successors and Assigns. This Letter Agreement shall inure to the
         benefit of and shall be binding upon the parties hereto and their
         respective successors and assigns, including but not limited to (i)
         with respect to the Company, any entity with which the Company may
         merge or consolidate or to which the Company may sell substantially all
         of its assets, and (ii) with respect to you, your executors,
         administrators, heirs and legal representatives. In the event of your
         death, all amounts due hereunder shall be accelerated and immediately
         payable to your estate.

12.      Severability; Headings. In the event that any provision of this Letter
         Agreement shall be held by a court of proper jurisdiction to be
         invalid, void or voidable or otherwise unenforceable, the balance of
         this Letter Agreement shall continue in full force and effect unless
         such construction would clearly be contrary to the intentions of the
         parties or would result in an unconscionable injustice. The headings of
         the sections and paragraphs of this Letter Agreement are for
         convenience of reference only and shall not constitute a part hereof.

13.      Miscellaneous: Choice of Law. This Letter Agreement may be executed in
         several counterparts, each or which shall be deemed to be an original
         but all of which together will constitute one and the same instrument.
         This Letter Agreement constitutes the entire agreement, and supersedes
         all prior agreements, of the parties hereto relating to the subject
         matter hereof, and there are no written or oral terms or
         representations made by either party other than those contained herein
         and therein. This Letter Agreement cannot be modified, altered or
         amended except by a writing signed by all the parties. No waiver by
         either party of any provision or condition of this Letter Agreement at
         any time shall be deemed a waiver of such provision or condition at any
         prior or subsequent time or of any provision or condition at the same
         or any prior or subsequent time. This Letter Agreement shall be
         governed by and construed in accordance with the domestic laws of the
         State of New Jersey, without giving effect to any choice of law or
         conflict of law provision or rule (whether of the State of New Jersey
         or any other jurisdiction) that would cause the application of the laws
         of any jurisdiction other than the State of New Jersey.

14.      Facsimile Signatures Valid. Execution of this Letter Agreement with
         signatures transmitted via facsimile shall be considered valid.

                                     * * * *

                                       5
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If this Letter Agreement conforms to your understanding and is acceptable to
you, please indicate your agreement by signing and dating the enclosed copy of
this Letter Agreement where indicated and returning it to the Company. You
acknowledge and agree that you have been provided with the opportunity to have a
period of at least 21 days in which to review and consider this Letter
Agreement, and you have used such review period to the extent desired by you.
After your execution of this Letter Agreement, you will then be permitted to
revoke this Letter Agreement in writing at any time during the period of seven
days following the execution thereof. In the event that you execute this Letter
Agreement, this Letter Agreement will not be effective or enforceable, and no
payments will be made hereunder, until the seven-day revocation period has
expired; upon the expiration of such seven day period after your execution (and
assuming no revocation), this Letter Agreement shall become effective. In the
event that you fail to execute this letter by November 8, 2002, or if you
execute this Letter Agreement and subsequently elect to revoke this Letter
Agreement in writing pursuant to the terms hereof within such seven day
revocation period, this Letter Agreement will be of no force or effect, and no
party to this Letter Agreement will have any rights or obligations hereunder.

Sincerely,

By: /s/ Jeffrey L. Radke
   ----------------------------
      Jeffrey L. Radke
      President & Chief Operating Officer

THIS LETTER AGREEMENT IS A LEGAL DOCUMENT. YOU SHOULD CONSULT WITH AN ATTORNEY
PRIOR TO SIGNING THIS LETTER AGREEMENT.

BY SIGNING THIS LETTER AGREEMENT YOU ACKNOWLEDGE THAT YOU ARE COMPETENT, THAT
YOU HAVE BEEN PROVIDED WITH THE OPPORTUNITY TO HAVE A PERIOD OF AT LEAST 21 DAYS
IN WHICH TO REVIEW AND CONSIDER THIS LETTER AGREEMENT WITH AN ATTORNEY OF YOUR
CHOICE AND YOU HAVE USED SUCH REVIEW PERIOD TO THE EXTENT YOU DESIRED, THAT YOU
HAVE READ AND UNDERSTAND AND VOLUNTARILY ACCEPT THIS LETTER AGREEMENT AS FULLY
AND FINALLY RESOLVING, WAIVING AND RELEASING ANY AND ALL CLAIMS WHICH YOU MAY
HAVE AGAINST THE COMPANY AND RELEASEES (AS DEFINED HEREIN), INCLUDING ANY AND
ALL CLAIMS UNDER THE AGE DISCRIMINATION IN EMPLOYMENT ACT, THAT NO PROMISES OR
INDUCEMENTS HAVE BEEN MADE TO YOU EXCEPT AS SET FORTH IN THIS LETTER AGREEMENT,
AND THAT YOU HAVE SIGNED THIS LETTER AGREEMENT FREELY AND VOLUNTARILY, INTENDING
TO BE LEGALLY BOUND BY ITS TERMS. THE FOREGOING IS A SUMMARY DESCRIPTION OF THE
GENERAL IMPORT OF THIS INSTRUMENT AND DOES NOT ALTER OR AMEND THE DETAILED
PROVISIONS CONTAINED IN THE BODY HEREOF.

ACCEPTED AND AGREED:

/s/ James F. Dore                                        Date: July 26, 2002
-----------------------------                                 ------------------

                                       6<PAGE>
                                                                    EXHIBIT 10.3

                               THIRD AMENDMENT TO
                  FIRST AMENDED AND RESTATED CREDIT AGREEMENT,
                               CONSENT AND WAIVER

         THIS THIRD AMENDMENT TO FIRST AMENDED AND RESTATED CREDIT AGREEMENT,
CONSENT AND WAIVER, dated as of the 8th day of November, 2002 (this "Third
Amendment"), is made in respect of the First Amended and Restated Credit
Agreement dated August 31, 1999, as amended by a First Amendment dated March 29,
2000 and an Amended and Restated Second Amendment dated April 4, 2002 (together,
the "Existing Credit Agreement"), among PXRE CORPORATION, a Delaware corporation
with its principal offices in Edison, New Jersey (the "Borrower"), PXRE GROUP
LTD., a Bermuda corporation ("PXRE Group"), and PXRE REINSURANCE (BARBADOS)
LTD., a Barbados corporation ("PXRE Barbados"), the banks and financial
institutions listed on the signature pages thereof or that become parties
thereto after the date thereof (collectively the "Lenders"), and WACHOVIA BANK,
NATIONAL ASSOCIATION (formerly known as First Union National Bank), as agent for
the Lenders (in such capacity, the "Agent"). Capitalized terms used but not
defined herein shall have the meanings given to such terms in the Existing
Credit Agreement.

                                    RECITALS

         The parties agree to amend the Existing Credit Agreement, and the
Lenders and Agent agree to grant the necessary consents, in connection with the
proposal by PXRE Group to develop the reinsurance business of its Bermuda
subsidiary, PXRE Reinsurance Ltd. ("PXRE Bermuda"), subject to the terms and
conditions set forth herein.

         In addition, Borrower requests certain amendments to the Existing
Credit Agreement and a waiver with respect to its failure to comply with certain
provisions set forth in Section 7.7(b) of the Existing Credit Agreement.

                             STATEMENT OF AGREEMENT

         NOW, THEREFORE, the Borrower, the Agent and the Lenders, for themselves
and their successors and assigns, agree as follows:

                                   ARTICLE I

                     AMENDMENTS TO EXISTING CREDIT AGREEMENT

         1.1 Amendments to Section 1.1. Section 1.1 of the Existing Credit
Agreement is hereby amended as follows:

                  (a) The following definitions are added to the defined terms
         in Section 1.1 in the appropriate alphabetical order:

<PAGE>

         "PXRE Bermuda Credit Enhancement Policy" shall mean the Credit
         Enhancement Policy in the form of Exhibit A to the Third Amendment
         issued by PXRE Bermuda as of November 8, 2002 for the benefit of the
         Lenders in which PXRE Bermuda absolutely, unconditionally and
         irrevocably agreed to pay to the Lenders the full and complete amount
         of any Obligations when and as the same shall become due (whether at
         the stated maturity, by acceleration or otherwise) in each case subject
         to the terms and conditions therein.

         "Third Amendment" shall mean the Third Amendment, Consent and Waiver to
         First Amended and Restated Credit Agreement and Consent, dated as of
         November 8, 2002, by and between the Borrower, the Guarantors, the
         Agent and the Lenders.

         "Third Amendment Effective Date" shall mean the date upon which all of
         the conditions of Article III of the Third Amendment are satisfied or
         waived in writing by the Required Lenders.

                  (b) The definition of "Agreement" is amended by deleting and
         replacing it in its entirety with the following:

         "Agreement" shall mean the First Amended and Restated Credit Agreement
         dated August 31, 1999, among the Borrower, PXRE Group, and PXRE
         Barbados, the Lenders and the Agent, as amended by a First Amendment
         among such parties dated March 29, 2000, by an Amended and Restated
         Second Amendment among such parties dated April 4, 2002, and by the
         Third Amendment among such parties dated November 8, 2002, and as
         further amended, modified or supplemented from time to time.

                  (c) The definition of "Credit Documents" is amended by
         deleting and replacing it in its entirety with the following:

         "Credit Documents" shall mean this Agreement, the Notes, the Fee
         Letter, the Amendment Fee Letter, the PXRE Bermuda Credit Enhancement
         Policy, and all other agreements, instruments, documents and
         certificates now or hereafter executed and delivered to the Agent or
         any Lender by or on behalf of any Credit Party or any of their
         respective Subsidiaries with respect to this Agreement and the
         transactions contemplated hereby, in each case as amended, modified,
         supplemented or restated from time to time.

                  (d) The definition of "Investment Policy" is amended by
         deleting and replacing it in its entirety with the following:

         "Investment Policy" shall mean the investment policy of PXRE Group and
         its Subsidiaries as of the Third Amendment Effective Date, as set forth
         in Schedule 7.5 to the Third Amendment, which shall not have been
         materially amended, modified and supplemented, other than as approved
         by the Agent and the Lenders.

                                       2
<PAGE>

         1.2 Amendment to Section 7.7(b)(i)(C). Section 7.7(b)(i)(C) of the
Existing Credit Agreement is hereby amended by deleting reference to
"$30,000,000" appearing in such Section 7.7(b)(i)(C) and inserting the text
"$80,000,000", in lieu thereof.

         1.3 Amendment to Section 7.7(b)(iv)(B). Section 7.7(b)(iv)(B) of the
Existing Credit Agreement is hereby amended by deleting reference to
"$3,000,000" appearing in such Section 7.7(b)(iv)(B) and inserting the text
"$7,500,000", in lieu thereof.

         1.4 Amendment to Section 8.1(c). Section 8.1(c) of the Existing Credit
Agreement is hereby amended by inserting the text "(other than the PXRE Bermuda
Credit Enhancement Policy")" immediately following each reference to "Credit
Documents" appearing therein.

         1.5 Amendments to Section 8.1. Section 8.1 of the Existing Credit
Agreement is hereby amended by: (a) inserting the word "or" at the end of
subsection (l) thereof, and (b) inserting the following new subsection (m)
immediately following subsection (l) of such Section 8.1:

                  "(m) At any time after the execution and delivery thereof, the
         PXRE Bermuda Credit Enhancement Policy or any provision thereof shall
         cease to be in full force or effect, or PXRE Bermuda or any Person
         acting by or on behalf of PXRE Bermuda shall deny or disaffirm its
         obligations under the PXRE Bermuda Credit Enhancement Policy or PXRE
         Bermuda shall default in the due performance or observance of any term,
         covenant or agreement on its part to be performed or observed pursuant
         to the PXRE Bermuda Credit Enhancement Policy."

         1.6 Amendments to Section 8.1. Section 8.1 of the Existing Credit
Agreement is hereby amended by inserting the text "PXRE Bermuda," immediately
following each reference to "Borrower" appearing in subsections (e), (f), (g),
(h), (j) and (k) of such Section 8.1 therein.

         1.7 Schedules 7.5(b) and 7.5(c). Schedules 7.5(b) and 7.5(c) of the
Existing Credit Agreement are amended by deleting and replacing them in their
entirety with Schedule 7.5 attached hereto.

                                   ARTICLE II

                               CONSENT AND WAIVER

         2.1 Consent to Deed Poll Guarantee. Notwithstanding anything to the
contrary contained in Sections 7.2 and 7.7 of the Existing Credit Agreement, but
subject to satisfaction of the conditions set forth in Article III, the Agent
and the Lenders do hereby consent to the issuance by PXRE Group of the Deed Poll
Guarantee (the "Group Guarantee") in the form of Exhibit B hereto in support of
the obligations of PXRE Bermuda in favor of the Cedents (as defined therein),
provided that (w) the provisions of each reinsurance agreement, binder and slip
entered into after the date hereof having the benefit of the Group Guarantee and
the performance of the parties thereunder shall not conflict with any condition,
covenant or agreement contained in the Existing Credit Agreement or any of the
other Credit Documents, (x) each such reinsurance agreement, binder and slip
having the benefit of the Group Guarantee shall be entered into in the ordinary
course of business of PXRE Bermuda as set forth in Section 7.8 of the Existing
Credit Agreement, (y) the obligations incurred by PXRE Group under the Group
Guarantee shall not constitute Indebtedness under the Existing Credit Agreement
and (z) PXRE Group shall not amend, modify or supplement the Group Guarantee,
other than as approved by the Agent and the Required Lenders.

                                       3
<PAGE>

         2.2 Waiver. The Borrower has informed the Agent that it has entered
into reinsurance agreements with a basis of reinsurance exceeding the thirty
percent (30%) quota share limitation set forth in Section 7.7(b)(i)(A) of the
Existing Credit Agreement and has failed to provide to the Agent and the Lenders
projections required under Section 7.7(b)(i)(B) of the Existing Credit
Agreement. The Borrower has requested that the Required Lenders waive such
noncompliance with Sections 7.7(b)(i)(A) and 7.7(b)(i)(B) and that the Agent
forbear the exercise of its rights pursuant to Sections 8.2 and 8.3 of the
Existing Credit Agreement, and the Required Lenders have agreed to provide such
waiver on the terms and conditions set forth herein. Accordingly, in
consideration of the premises and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Required Lenders
hereby agree to waive the Borrower's noncompliance with Sections 7.7(b)(i)(A)
and 7.7(b)(i)(B) of the Existing Credit Agreement subject to the delivery of the
projections required in Section 7.7(b)(i)(B) prior to the Third Amendment
Effective Date. The Borrower understands that as of the Third Amendment
Effective Date, all of the requirements of Sections 7.7(b)(i)(A) and
7.7(b)(i)(B) of the Existing Credit Agreement that have been waived as provided
herein shall, without any further action by or notice to or from the Agent or
any Lender, be in full force and effect, and unless such noncompliance shall
have been cured, the Agent shall have all of the rights and remedies provided to
it under the Existing Credit Agreement, the other Credit Documents, applicable
law or otherwise with respect to such noncompliance as though no waiver had been
granted hereunder. The waiver set forth herein is limited and specified, and
shall not constitute or be deemed to constitute an amendment, modification or
waiver of any provision of the Existing Credit Agreement or waiver of any
Default or Event of Default except as expressly set forth herein.

                                  ARTICLE III

                           CONDITIONS OF EFFECTIVENESS

         3.1 Conditions of Effectiveness. This Third Amendment and the
amendments and consent provided herein, are subject to the satisfaction of the
following conditions precedent:

                  (a) The Agent shall have received the following, each dated as
         of the Third Amendment Effective Date and in sufficient executed
         originals for each Lender:

                           (1) this Third Amendment, duly completed and executed
                  by the Borrower, each Guarantor, the Agent and each Required
                  Lender;

                           (2) the PXRE Bermuda Credit Enhancement Policy in the
                  form of Exhibit A attached hereto, duly completed and executed
                  by PXRE Bermuda;

                                       4
<PAGE>

                           (3) the Group Guarantee in the form of Exhibit B
                  attached hereto, duly completed and executed by PXRE Group;

                           (4) the favorable opinion of Conyers Dill & Pearman,
                  counsel to PXRE Group and PXRE Bermuda, in form reasonably
                  satisfactory to the Agent and substantially covering such
                  opinion matters as the Agent may reasonably request.

                  (b) The Agent shall have received a certificate, signed by the
         president or chief financial officer of each Credit Party, in form and
         substance satisfactory to the Agent, certifying that (i) all
         representations and warranties of such Credit Party contained in this
         Third Amendment, the Existing Credit Agreement (subject to the updating
         of the representations and warranties therein pursuant to this Third
         Amendment) and the other Credit Documents are true and correct as of
         the Third Amendment Effective Date, both immediately before and after
         giving effect to the consummation of the transactions contemplated
         hereby, (ii) no Default or Event of Default has occurred and is
         continuing, both immediately before and after giving effect to the
         consummation of the transactions contemplated hereby, (iii) both
         immediately before and after giving effect to the consummation of the
         transactions contemplated hereby, no Material Adverse Change has
         occurred since December 31, 2001, and there exists no event, condition
         or state of facts that could reasonably be expected to result in a
         Material Adverse Change, (iv) that the articles or certificate of
         incorporation of such Credit Party, as the case may be, have not been
         amended, revised or restated since the date of the Second Amendment,
         and (v) that the bylaws, operating agreement or memorandum and articles
         of association, as applicable, of such Credit Party, as the case may
         be, have not been amended, revised or restated since the date of the
         Second Amendment.

                  (c) The Agent shall have received certificates of the
         secretary, clerk or director, as applicable, or an assistant secretary,
         clerk or director, as applicable, of each Credit Party, in form and
         substance satisfactory to the Agent and dated as of the Third Amendment
         Effective Date, certifying (i) that attached thereto is a true and
         complete copy of resolutions adopted by the board of directors (or duly
         authorized committee thereof) of such Credit Party authorizing the
         execution, delivery and performance of this Third Amendment, and (ii)
         as to the incumbency and genuineness of the signature of each officer
         of such Credit Party executing this Third Amendment.

                  (d) The Agent shall have received a certificate of the
         secretary, clerk or director, as applicable, or an assistant secretary,
         clerk or director, as applicable, of PXRE Bermuda, in form and
         substance satisfactory to the Agent and dated no earlier than thirty
         (30) days prior to the Third Amendment Effective Date, certifying (i)
         that attached thereto is a true and complete copy of the articles or
         certificate of incorporation and all amendments thereto of PXRE
         Bermuda, certified, to the extent applicable, as of a recent date by
         the Secretary of State (or comparable Governmental Authority) of its
         jurisdiction or organization, and that the same has not been amended
         since the date of such certification, (ii) that attached thereto is a
         true and complete copy of the bylaws, operating agreement or memorandum
         and articles of association, as applicable, of PXRE Bermuda, as then in
         effect and as in effect at all times from the date on which the
         resolutions referred to in clause (iii) below were adopted to and
         including the date of such certificate, (iii) that attached thereto is
         a true and complete copy of resolutions adopted by the board of
         directors (or duly authorized committee thereof) of PXRE Bermuda
         authorizing the execution, delivery and performance of the PXRE Bermuda
         Credit Enhancement Policy, and (iv) as to the incumbency and
         genuineness of the signature of each officer of PXRE Bermuda executing
         the PXRE Bermuda Credit Enhancement Policy.

                                       5
<PAGE>

                  (e) PXRE Bermuda shall have duly complied with and performed
         all of its agreements and conditions set forth in the PXRE Bermuda
         Credit Enhancement Policy required to be complied with or performed by
         it on or prior to the Third Amendment Effective Date and the Agent
         shall have received evidence satisfactory to it that premium due
         thereunder shall have been paid in full by PXRE Group.

                  (f) The Agent shall have received a Covenant Compliance
         Worksheet, duly completed and certified by the chief financial officer
         or treasurer of PXRE Group and the Borrower and in form and substance
         satisfactory to the Agent, demonstrating PXRE Group's and Borrower's
         compliance with the financial covenants set forth in Sections 6.1
         through 6.4, determined on a pro forma basis as of September 30, 2002,
         after giving effect to the consummation of the transaction contemplated
         hereby.

                  (g) The Lenders shall have received a certificate as of a
         recent date of the good standing or existence of PXRE Bermuda under the
         law of its state or country of organization.

                  (h) All approvals, permits and consents of any Governmental
         Authorities or other Person required in connection with the execution
         and delivery of this Third Amendment, the PXRE Credit Enhancement
         Policy and the consummation of the transactions contemplated hereby
         shall have been obtained (without the imposition of conditions that are
         not reasonably acceptable to the Agent and the Required Lenders), and
         all related filings, if any, shall have been made, and all such
         approvals, permits, consents and filings shall be in full force and
         effect and the Agent shall have received such copies thereof as it
         shall have requested; all applicable waiting periods shall have expired
         without any adverse action being taken by any Governmental Authority
         having jurisdiction; and no action, proceeding, investigation,
         regulation or legislation shall have been instituted, threatened or
         proposed before, and no order, injunction or decree shall have been
         entered by, any court or other Governmental Authority, in each case to
         enjoin, restrain or prohibit, to obtain substantial damages in respect
         of, or that is otherwise related to or arises out of, this Third
         Amendment, the PXRE Credit Enhancement Policy or the consummation of
         the transactions contemplated hereby, or that, in the opinion of the
         Agent and the Required Lenders, would otherwise be reasonably likely to
         have a Material Adverse Effect.

                  (i) The Borrower shall have paid the fee that is due and
         payable under that certain letter between the Agent and Borrower dated
         October 2, 2002 (the "Third Amendment Fee Letter"), together with all
         other fees and expenses of the Agent and the Lenders required hereunder
         or thereunder or under any other Credit Document to be paid on or prior
         to the Third Amendment Effective Date (including the reasonable fees
         and expenses of U.S. and Bermuda counsel to the Agent) in connection
         with this Third Amendment and the transactions contemplated hereby.

                                       6
<PAGE>

                  (j) Each of the representations and warranties contained in
         the Existing Credit Agreement, this Third Amendment and the other
         Credit Documents shall be true and correct on and as of the Third
         Amendment Effective Date with the same effect as if made on and as of
         such date, both immediately before and after giving effect to the
         consummation of the transactions contemplated hereby, except to the
         extent any such representation or warranty is expressly stated to have
         been made as of a specific date, in which case such representation or
         warranty shall be true and correct as of such date.

                  (k) No Default or Event of Default shall have occurred and be
         continuing, both immediately before and after giving effect to the
         consummation of the transactions contemplated hereby.

                  (l) The Agent and each Lender shall have received such other
         documents, certificates, opinions and instruments in connection with
         the PXRE Bermuda Credit Enhancement Policy, the Group Guarantee and
         this Third Amendment as it shall have reasonably requested.

                                   ARTICLE IV

                         REPRESENTATIONS AND WARRANTIES

         To induce the Agent and Lenders to enter into this Third Amendment, the
Credit Parties each represent and warrant to the Agent and each Lender, on the
Third Amendment Effective Date, both before and after giving effect to the
transactions contemplated hereby, as follows (PXRE Group making such
representations and warranties as to itself and PXRE Bermuda, the Borrower as to
itself only and PXRE Barbados as to itself only):

         4.1 Corporate Power. Each of the Guarantors, the Borrower and PXRE
Bermuda has the full corporate power and authority to execute, deliver and
perform the Third Amendment, the Group Guarantee and the PXRE Bermuda Credit
Enhancement Policy to which it is or will be a party.

         4.2 Authorization; Enforceability. Each of the Borrower, the Guarantors
and PXRE Bermuda has taken all necessary corporate action to execute, deliver
and perform the Third Amendment, the Group Guarantee and the PXRE Bermuda Credit
Enhancement Policy to which it is or will be a party, and has validly executed
and delivered the Third Amendment, the Group Guarantee and the PXRE Bermuda
Credit Enhancement Policy. The Third Amendment constitutes the legal, valid and
binding obligation of the Borrower and the Guarantors enforceable against each
of them in accordance with their respective terms, except as enforceability may
be limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting creditors' rights generally, by general equitable
principles or by principles of good faith and fair dealing. The PXRE Bermuda
Credit Enhancement Policy constitutes the legal, valid and binding obligation of
PXRE Bermuda enforceable against it in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting creditors' rights generally, by
general equitable principles or by principles of good faith and fair dealing

                                       7
<PAGE>

         4.3 No Violation. The execution, delivery and performance by each of
the Borrower the Guarantors, and PXRE Bermuda of this Third Amendment, the Group
Guarantee and the PXRE Bermuda Credit Enhancement Policy, and compliance by it
with the terms hereof and thereof, do not and will not (i) violate any provision
of its certificate of incorporation or bylaws or contravene any other material
Requirement of Law applicable to it, (ii) conflict with, result in a breach of
or constitute (with notice, lapse of time or both) a default under any
indenture, agreement or other instrument to which it is a party, by which it or
any of its properties is bound or to which it is subject, or (iii) result in or
require the creation or imposition of any Lien upon any of its properties or
assets.

         4.4 Governmental Authorization; Permits. No consent, approval,
authorization or other action by, notice to, or registration or filing with, any
Governmental Authority or other Person is or will be required as a condition to
or otherwise in connection with the due execution, delivery and performance by
the Borrower, the Guarantors and PXRE Bermuda of this Third Amendment, the Group
Guarantee and the PXRE Bermuda Credit Enhancement Policy or the legality,
validity or enforceability hereof or thereof.

                                   ARTICLE V

                                     GENERAL

         5.1 Full Force and Effect. From and after the Third Amendment Effective
Date, all references to the Existing Credit Agreement set forth in any other
Credit Document or other agreement or instrument shall, unless otherwise
specifically provided, be references to the Credit Agreement as amended by this
Third Amendment and as may be further amended, modified, restated or
supplemented from time to time. This Third Amendment is limited as specified and
shall not constitute or be deemed to constitute an amendment, modification or
waiver of, or consent to departure from, any provision of the Existing Credit
Agreement except as expressly set forth herein. Except as expressly amended
hereby, the Existing Credit Agreement shall remain in full force and effect in
accordance with its terms.

         5.2 Applicable Law. This Third Amendment shall be governed by and
construed in accordance with the laws of the state of New York, without regard
to principles of conflict of laws (excluding New York General Obligations Law
ss.5-1401).

         5.3 Counterparts. This Third Amendment may be executed in two or more
counterparts, each of which shall constitute an original, but all of which when
taken together shall constitute but one instrument.

         5.4 Headings. The headings of this Third Amendment are for the purposes
of reference only and shall not affect the construction of this Third Amendment.

                                       8
<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused this Third Amendment
to be executed by their duly authorized officers all as of the day and year
first above written.

                            PXRE CORPORATION

                            By:      /s/ John M. Modin
                                     ------------------------------------

                            Name:    John M. Modin
                                     ------------------------------------

                            Title:   Chief Financial Officer
                                     ------------------------------------

                            PXRE GROUP LTD.

                            By:      /s/ Jeffrey L. Radke
                                     ------------------------------------

                            Name:    Jeffrey L. Radke
                                     ------------------------------------

                            Title:   President
                                     ------------------------------------

                            PXRE REINSURANCE (BARBADOS) LTD.

                            By:      /s/ Jeffrey L. Radke
                                     ------------------------------------

                            Name:    Jeffrey L. Radke
                                     ------------------------------------

                            Title:   Vice President
                                     ------------------------------------

                             (signatures continued)

<PAGE>

                            WACHOVIA BANK, NATIONAL ASSOCIATION, f/k/a
                            FIRST UNION NATIONAL BANK, as Agent
                              and as a Lender

                            By:      /s/ Daniel J. Norton
                                     ------------------------------------
                            Name:        Daniel J. Norton
                                     ------------------------------------
                            Title:       Director
                                     ------------------------------------

                            BANK ONE, NA (f/k/a THE FIRST NATIONAL
                            BANK OF CHICAGO

                            By:      /s/ Gretchen Roetzer
                                     ------------------------------------
                            Name:        Gretchen Roetzer
                                     ------------------------------------
                            Title:       Director
                                     ------------------------------------

                            FLEET NATIONAL BANK

                            By:      ____________________________________

                            Name:    ____________________________________

                            Title:   ____________________________________

                            CREDIT LYONNAIS NEW YORK BRANCH

                            By:      ____________________________________

                            Name:    ____________________________________

                            Title:   ____________________________________

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