Document:

Exhibit 10.4 

EXPENSE AGREEMENT 

AGREEMENT AS TO
EXPENSES AND LIABILITIES 

        AGREEMENT
AS TO EXPENSES AND LIABILITIES, dated as of November 14, 2002, between Everest Reinsurance
Holdings, Inc., a Delaware corporation (the “Corporation”), and Everest Re
Capital Trust, a Delaware business trust (the “Issuer Trust”). 

        WHEREAS,
the Issuer Trust intends to issue its Common Securities (the “Common
Securities”) to and acquire Debt Securities from the Corporation and to issue and
sell 7.85% Preferred Securities (the “Preferred Securities”) with such powers,
preferences and special rights and restrictions as are set forth in the Amended and
Restated Trust Agreement, dated as of November 14, 2002, among the Corporation, as
Depositor, JPMorgan Chase Bank, as Property Trustee, Chase Manhattan Bank USA, National
Association, as Delaware Trustee, and the Holders of Trust Securities, as the same may be
amended from time to time (the “Trust Agreement”); 

        WHEREAS,
the Corporation will directly or indirectly own all of the Common Securities of the Trust
and will issue the Debt Securities; 

        WHEREAS,
capitalized terms used but not defined herein have the meanings set forth in the Trust
Agreement; 

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

ARTICLE I 

        SECTION
1.1. Guarantee by the Corporation. Subject to the terms and conditions hereof,
the Corporation hereby irrevocably and unconditionally guarantees to each person or
entity to whom the Issuer Trust is now or hereafter becomes indebted or liable (the “Beneficiaries”)
the full payment, when and as due, of any and all Obligations (as hereinafter defined) to
such Beneficiaries. As used herein, “Obligations” means any costs, expenses or
liabilities of the Issuer Trust, other than obligations of the Issuer Trust to pay to
holders of any Trust Securities the amounts due such holders pursuant to the terms of the
Trust Securities. This Agreement is intended to be for the benefit of, and to be
enforceable by, all such Beneficiaries, whether or not such Beneficiaries have received
notice hereof.  

        SECTION
1.2. Subordination of Guarantee. The guarantee and other liabilities and
obligations of the Corporation under this Agreement shall constitute unsecured
obligations of the Corporation and shall rank subordinate and junior in right of payment
to all Senior Indebtedness (as defined in the Indenture) of the Corporation to the extent
and in the manner set forth in the Indenture with respect to the Debt Securities, and the
provisions of Article XIV of the Indenture will apply, mutatis mutandis, to the
obligations of the Corporation hereunder. The obligations of the Corporation hereunder do
not constitute Senior Indebtedness (as defined in the Indenture) of the Corporation.  

        SECTION
1.3. Term of Agreement. This Agreement shall terminate and be of no further
force and effect upon the later of (a) the date on which full payment has been made of
all amounts payable to all holders of all the Preferred Securities (whether upon
redemption, liquidation, exchange or otherwise) and (b) the date on which the Debt
Securities shall have been distributed to the Holders of the Trust Securities as provided
in Article IX of the Trust Agreement; provided, however, that this
Agreement shall continue to be effective or shall be reinstated, as the case may be, if
at any time any holder of Preferred Securities or any Beneficiary must restore payment of
any sums paid under the Preferred Securities, under any Obligation, under the Guarantee
Agreement dated the date hereof by the Corporation and JPMorgan Chase Bank, as guarantee
trustee, or under this Agreement for any reason whatsoever. This Agreement is continuing,
irrevocable, unconditional and absolute.  

        SECTION
1.4. Waiver of Notice. The Corporation hereby waives notice of acceptance of
this Agreement and of any Obligation to which it applies or may apply, and the
Corporation hereby waives presentment, demand for payment, protest, notice of nonpayment,
notice of dishonor, notice of redemption and all other notices and demands.  

        SECTION
1.5. No Impairment. The obligations, covenants, agreements and duties of the
Corporation under this Agreement shall in no way be affected or impaired by reason of the
happening from time to time of any of the following:  

        (a)              the
extension of time for the payment by the Issuer Trust of all or any portion           of
the Obligations or for the performance of any other obligation under, arising
          out of, or in connection with, the Obligations;  

        (b)              any
failure, omission, delay or lack of diligence on the part of the           Beneficiaries
to enforce, assert or exercise any right, privilege, power or           remedy conferred
on the Beneficiaries with respect to the Obligations or any           action on the part
of the Issuer Trust granting indulgence or extension of any           kind; or  

        (c)              the
voluntary or involuntary liquidation, dissolution, sale of any collateral,
          receivership, insolvency, bankruptcy, assignment for the benefit of creditors,
          reorganization, arrangement, composition or readjustment of debt of, or other
          similar proceedings affecting, the Issuer Trust or any of the assets of the
          Issuer Trust (other than the dissolution of the Issuer Trust in accordance with
          the terms thereof).  

        There
shall be no obligation of the Beneficiaries to give notice to, or obtain the consent of,
the Corporation with respect to the happening of any of the foregoing.  

        SECTION
1.6. Enforcement. A Beneficiary may enforce this Agreement directly against
the Corporation and the Corporation waives any right or remedy to require that any action
be brought against the Issuer Trust or any other person or entity before proceeding
against the Corporation.  

        SECTION
1.7. Subrogation. The Corporation shall be subrogated to all
rights (if any) of any Beneficiary against the Issuer Trust in respect of any amounts
paid to the Beneficiaries by the Corporation under this Agreement; provided, however,
that the Corporation shall not (except to the extent required by mandatory provisions of
law) be entitled to enforce or exercise any rights that it may acquire by way of
subrogation or any indemnity, reimbursement or other agreement, in all cases as a result
of payment under this Agreement, if, at the time of any such payment, any amounts are due
and unpaid under this Agreement.  

ARTICLE II 

        SECTION
2.1.      Assignment.  This  Agreement  may not be assigned by either  party hereto
 without the consent of the other,  and any purported assignment without such consent
shall be void. 

        SECTION
2.2.      Binding  Effect.  All guarantees  and agreements  contained in this  Agreement
 shall bind the  successors,  assigns, receivers, trustees and representatives of the
Corporation and shall inure to the benefit of the Beneficiaries. 

        SECTION
2.3. Amendment. So long as there remains any Beneficiary or any Preferred
Securities are outstanding, this Agreement shall not be modified or amended in any manner
adverse to such Beneficiary or to the holders of the Preferred Securities without the
consent of such Beneficiary or the holders of the Preferred Securities, as the case may
be.  

        SECTION
2.4. Notices. Any notice, request or other communication required or permitted
to be given hereunder shall be given in writing by delivering the same against receipt
therefor by facsimile transmission (confirmed by mail), telex or by registered or
certified mail, addressed as follows (and if so given, shall be deemed given when mailed
or upon receipt of an answer –back, if sent by telex):  

      If
given to the Corporation: 

			
		Everest Reinsurance Holdings, Inc.	
		477 Martinsville Road	
		P.O. Box 830	
		Liberty Corner, New Jersey 07938	
		Facsimile No.:  (908) 604-3450 	
		Attention:  General Counsel	

      If
given to the Issuer Trust: 

			
		Evererest Re Capital Trust	
		477 Martinsville Road	
		P.O. Box 830 Liberty Corner, New Jersey 07938	
		Facsimile No.:  (908) 604-3450	
		Attention: General Counsel	
			

        With
a copy to: 

			
		Everestr Reinsurance Holdings, Inc.	
		477 Martinsville Road	
		P.O. Box 830	
		Liberty Corner, New Jersey 07938	
		Facsimile No.:  (098) 604-3450	
		Attention:  General Counsel	

        SECTION
2.5.      Governing Law. THIS  AGREEMENT  SHALL BE GOVERNED BY, AND CONSTRUED AND
 INTERPRETED IN ACCORDANCE  WITH, THE LAWS OF THE STATE OF NEW YORK. 

         THIS AGREEMENT is executed as of the day and year first above written.

		EVEREST REINSURANCE HOLDINGS, INC.
		  
		by:       /S/ STEPHEN L. LIMAURO
		

		Name:    Stephen L. Limauro
		Title:      Executive Vice President and Chief
		Financial Officer

		
		

		EVEREST RE CAPITAL TRUST
		  
		by:       /S/ KEITH T. SHOEMAKER
		

		Name:    Keith T. Shoemaker
		Title:    Administrative TrusteeExhibit 10.5 

      Registration
No. 26918  

[BERMUDA COAT OF ARMS] 

BERMUDA 

TAX ASSURANCE 

WHEREAS the Minister of
Finance (“the Minister”), pursuant to section 2 of the Exempted
Undertakings Tax Protection Act 1966, is authorised to enter into an
arrangement with any exempted undertaking upon application. 

WHEREAS such undertakings may
be given an assurance that in the event of there being enacted in Bermuda any legislation
imposing tax computed on profits or income or computed on any capital asset, gain or
appreciation, or any tax in the nature of estate duty or inheritance tax, then the
imposition of any tax described herein shall not be applicable to such undertakings or to
any of its operations or the share, debentures or other obligations of the said
undertakings. 

THEREFORE the Minister,
upon application, hereby grants the aforementioned assurance to:

Everest Reinsurance Group, Ltd.

(”the Undertaking”)  

 

PROVIDED THAT this assurance
shall not be construed so as to: 

     	(i) 	
          prevent the application of any such tax or duty to such persons as are
          ordinarily resident in these Islands; and 

          

     	(ii) 	
          prevent the application of any tax payable in accordance with the provisions of
          the Land Tax Act 1967 or otherwise payable in relation to the land leased to the
          Undertaking. 

          

THIS TAX ASSURANCE shall be in
effect until the 28th day of March, 2016.  

Given
under my hand this 
 20th day of September, 1999

      /S/
JEREMY COX 

      Jeremy
Cox 

      Registrar
of Companies 
 for MINISTER OF FINANCE

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