Document:

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                               SECOND AMENDMENT TO
                   FIRST AMENDED AND RESTATED CREDIT AGREEMENT
                                   AND CONSENT

         THIS SECOND AMENDMENT TO FIRST AMENDED AND RESTATED CREDIT AGREEMENT
AND CONSENT, dated as of the ___ day of March, 2002 (this "Second 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 (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 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 their consent, in connection with the private
issuance by PXRE Group of certain series of its convertible preferred shares
pursuant to the terms of a Share Purchase Agreement, dated December 10, 2001,
between PXRE Group and certain investors.

                             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:

         "Escrow Agreement" shall mean an escrow agreement, substantially in the
         form of Exhibit A to the Second Amendment, between the Borrower, PXRE
         Group, the Agent, and First Union National Bank, as escrow agent,
         pursuant to which $20,000,000 of proceeds from the sale and issuance of
         the Preferred Shares shall be deposited into an escrow account for
         payment of outstanding Loans in connection with the Commitment
         reduction on March 31, 2002 required pursuant to Section 2.5(b).

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         "Excess Cash Flow" shall mean the difference of (a) the amount
         calculated pursuant to clause (i) of the definition of "Fixed Charge
         Coverage Ratio", minus (b) the amount by which the Available Dividend
         Amount for the Measurement Period has been reduced as a result
         permanent reductions of the Commitments in fiscal year 2003 (together
         with any related repayments of principal of the Loans), minus (c) the
         amount calculated pursuant to clause (ii) of the definition of "Fixed
         Charge Coverage Ratio" (without duplication of clause (b)), with the
         "Measurement Period" in each case being the period ending June 30,
         2003.

         "Permitted Redemption Amount" shall mean, as of any date, an amount
         equal to (a) 20% of the cumulative amount by which Consolidated Net
         Income in any calendar year commencing with the year ending December
         31, 2002 exceeds $50,000,000 minus (b) the sum of all cash and the fair
         market value of all non-cash consideration paid or payable by PXRE
         Group or the Subsidiary of the Borrower that has issued Trust Preferred
         Securities pursuant to any transaction described in Section 7.6(i)(C)
         and effected or commenced after December 10, 2001.

         "Preferred Share Purchase Agreement" shall mean the Share Purchase
         Agreement, dated December 10, 2001, between PXRE Group and Capital Z
         Financial Services Fund II, L.P., Capital Z Financial Services Private
         Fund II, L.P., Reservoir Capital Partners, L.P., Reservoir Capital
         Master Fund, L.P. and Richard E. Rainwater, as purchasers.

         "Preferred Share Purchase Documents" shall mean and collectively refer
         to the Preferred Share Purchase Agreement and the documents and
         instruments required by the terms thereof to be executed and delivered
         by the parties in connection with the closing of the sale and issuance
         of the Preferred Shares.

         "Preferred Share Transactions" shall mean and collectively refer to (i)
         the sale and issuance of the Preferred Shares pursuant to the Preferred
         Share Purchase Agreement, (ii) the division of 20,000,000 of PXRE
         Group's 50,000,000 authorized common shares into three new classes of
         common shares issuable upon conversion of Preferred Shares, (iii) the
         expansion of the PXRE Group board of directors by two members to a
         total of eleven members, (iv) an amendment to the PXRE Group bye-laws
         which will authorize the creation of a new Class IV of the board of
         directors, (v) the contribution as capital to the Insurance
         Subsidiaries of the proceeds from the sale and issuance of the
         Preferred Shares, net of $500,000 retained by PXRE Group, the
         reasonable expenses incurred in connection therewith and the required
         deposit of funds pursuant to the Escrow Agreement, and (vi) such other
         transactions as are contemplated by the Preferred Share Purchase
         Agreement or are reasonably ancillary thereto.

         "Preferred Shares" shall mean, collectively, the 7,500 shares of Series
         A Convertible Voting Preferred Shares, 5,000 shares of Series B
         Convertible Voting Preferred Shares and 2,500 shares of Series C
         Convertible Voting Preferred Shares, in each case to be issued by PXRE
         Group pursuant to the Preferred Share Purchase Agreement.

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         "Second Amendment" shall mean the Second Amendment to First Amended and
         Restated Credit Agreement and Consent, dated as of March __, 2002, by
         and between the Borrower, the Guarantors, the Agent and the Lenders.

         "Second Amendment Effective Date" shall mean the date upon which all of
         the conditions of Article III of the Second Amendment are satisfied or
         waived in writing by the Lenders or, where applicable, 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 and by this Second Amendment,
         and as further amended, modified or supplemented from time to time.

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

                  "Applicable Margin Percentage" shall mean, at any time from
         and after the Second Amendment Effective Date, the applicable
         percentage (a) to be added to the Base Rate pursuant to Section 2.8 for
         purposes of determining the Adjusted Base Rate, (b) to be added to the
         LIBOR Rate pursuant to Section 2.8 for purposes of determining the
         Adjusted LIBOR Rate, and (c) to be used in calculating the commitment
         fee payable pursuant to Section 2.9(b), in each case as determined
         under the following matrix with reference to the Borrower's senior
         unsecured debt rating by Moody's or Standard & Poor's (in each case
         based upon the higher of the two ratings), when available, or, if not
         available, then with reference to an implied senior or unsecured debt
         rating, if available (provided that, for purposes of this Agreement,
         the rating that is two levels higher than the rating of the Borrower's
         Trust Preferred Securities by Standard & Poor's and Moody's shall be
         deemed to be an implied senior or unsecured debt rating by Standard &
         Poor's and Moody's, respectively):

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<TABLE>
<CAPTION>

                                              Applicable                              Applicable Margin
                         Moody's /             Margin            Applicable Margin     Percentage for
                       Standard &           Percentage for        Percentage for         Unutilized
          Level       Poor's Rating         Base Rate Loans        LIBOR Loans        Commitments Fee
          -----       -------------         ----------------       -----------         ---------------
           <S>      <C>                       <C>                  <C>                   <C>
            I        A3 / A- or above           0.500%               1.750%                0.350%

            II         Baa1 / BBB+              0.500%               1.875%                0.400%

           III          Baa2 / BBB              0.500%               2.000%                0.500%

            IV         Baa3 / BBB-              0.500%               2.125%                0.600%

            V          Less than
                       Baa3 / BBB-              1.000%               2.625%                1.000%
</TABLE>

         provided that on and after March 15, 2003 the Applicable Margin
         Percentage for LIBOR Loans shall be increased by adding 0.250% at each
         Level shown in the above table (e.g. the Applicable Margin Percentage
         for LIBOR Loans at Level III will be 2.250%).

         Notwithstanding anything set forth herein to the contrary, if at any
         time the difference between the senior unsecured debt ratings by
         Moody's and Standard & Poor's is more than one rating grade, then for
         purposes of determining the applicable level set forth above, the
         higher of the two ratings shall be reduced to the rating that is the
         median between the higher rating and the lower rating (or its
         equivalent); or, if the median is not determinable, then the higher of
         such two ratings shall be reduced to one rating grade lower.

         On each Adjustment Date (as hereinafter defined), the Applicable Margin
         Percentage for all Loans and the commitment fee payable pursuant to
         Section 2.9(b) shall be adjusted effective as of such date in
         accordance with the above matrix; provided, however, that,
         notwithstanding the foregoing or anything else herein to the contrary,
         if at any time an Event of Default described in Section 8.1(a) shall
         have occurred and be continuing, then at the election of the Required
         Lenders, at all times from and including the date on which such Event
         of Default occurred to the date on which such Event of Default shall
         have been cured or waived, each Applicable Margin Percentage shall be
         determined in accordance with Level V of the above matrix
         (notwithstanding the actual level). For purposes of this definition,
         after the Second Amendment Effective Date the first "Adjustment Date"
         shall be July 1, 2002 and thereafter shall be the tenth (10th) Business
         Day after the announcement by either Moody's or Standard & Poor's of
         any change in its rating with respect to the Borrower's senior
         unsecured debt. From the Second Amendment Effective Date through June
         30, 2002 each Applicable Margin Percentage shall be determined in
         accordance with Level III of the above matrix.

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

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         "Available Dividend Amount" shall mean, with respect to any Insurance
         Subsidiary for any period, the aggregate maximum amount of dividends
         that is permitted by the Insurance Regulatory Authority of its
         jurisdiction of domicile, under applicable Requirements of Law (without
         the necessity of any consent, approval or other action of such
         Insurance Regulatory Authority involving the granting of permission or
         the exercise of discretion by such Insurance Regulatory Authority), to
         be paid by such Insurance Subsidiary to the Borrower or another
         Subsidiary of the Borrower during such period (whether or not any such
         dividends are actually paid); provided that for the period from the
         Second Amendment Effective Date through December 31, 2002 the Available
         Dividend Amount may be increased by the following maximum amounts to
         reflect cash capital contributions made in connection with the
         Preferred Share Transactions: (i) $10,000,000 for PXRE Reinsurance and
         (ii) $3,000,000 for PXRE Bermuda; provided further that any increase in
         the Available Dividend Amount pursuant to the foregoing proviso shall
         be reduced by any net reduction in the Statutory Capital and Surplus of
         PXRE Reinsurance or PXRE Bermuda, respectively, during such period
         whether resulting from losses or otherwise.

         (e) The definition of "Disqualified Capital Stock" is amended by adding
the following proviso at the end thereof:

         ; provided further that the Preferred Shares, as issued on or about the
         Second Amendment Effective Date, shall not constitute Disqualified
         Capital Stock

         (f) The definition of "Fixed Charge Coverage Ratio" is amended by
deleting clause (i) thereof and replacing it in its entirety with the following:

                  (i) the sum (without duplication) of (s) the Available
         Dividend Amount for the Measurement Period, other than each Insurance
         Subsidiary that is a Subsidiary of another Insurance Subsidiary, plus
         (t) the Net Tax Sharing Payments with respect to the Measurement
         Period, plus (u) the Combined Net Cash Flow (whether positive or
         negative) of the Borrower's non-Insurance Subsidiaries for the
         Measurement Period, plus (v) other Net Cash Flow to the Borrower or
         PXRE Group (whether positive or negative) during the Measurement
         Period, minus (w) Holding Company Expenses accrued during such
         Measurement Period, (x) minus stock repurchases by PXRE Group during
         such Measurement Period, other than stock repurchases effected between
         January 1, 1998 and the day immediately preceding the Closing Date, (y)
         minus cash dividends paid with respect to the Preferred Shares
         (provided that such cash dividends may be paid only as allowed under
         clause (y) of Section 7.6(i)), minus (z) dividends reasonably estimated
         by PXRE Group (based upon the most recent quarterly dividend rate as
         set forth in the relevant Covenant Compliance Worksheet) to be paid by
         PXRE Group during the period of four consecutive fiscal quarters
         immediately following the Measurement Period (the "Pro Forma Period"),
         to

         (g) The definition of "Hybrid Securities Issuance" is amended by adding
the following proviso at the end thereof:

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         ; provided further that the Preferred Shares, as issued on or about the
         Second Amendment Effective Date, shall not constitute a Hybrid
         Securities Issuance

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

         "Maturity Date" shall mean March 31, 2004.

         (i) The definition of "Net Cash Flow" is amended by adding the
following proviso at the end thereof:

         ; provided further that the capital contributions made in connection
         with the Preferred Share Transactions shall be disregarded for purposes
         of determining Net Cash Flow

         1.2 Amendments to Section 2.5.

         (a) Section 2.5(b) of the Existing Credit Agreement is amended by
deleting and replacing it in its entirety with the following:

                  [2.5](b) On each date set forth below, the aggregate
         Commitments shall be automatically and permanently reduced by the
         amounts set forth below opposite such date:

                      Date                                          Amount
                      ----                                          ------

                  March 31, 2000                                  $10,000,000
                  March 31, 2001                                  $10,000,000
                  March 31, 2002                                  $20,000,000
                    July 1, 2002                                  $ 5,000,000
                  March 31, 2003                                  $20,000,000
                  March 31, 2004                                  $10,000,000

         or, if less, the remaining balance of the aggregate Commitments.

         (b) Section 2.5(e) of the Existing Credit Agreement is amended by
renumbering the existing Section 2.5(e) as Section 2.5(f) and by adding a new
Section 2.5(e) and as follows:

         [2.5](e) Concurrently with the delivery by PXRE Group, pursuant to
Section 5.1(a), of its quarterly financial statement for the fiscal quarter
ending June 30, 2003, and in any event not later than sixty (60) days after the
last day of such fiscal quarter, the Commitments shall be automatically and
permanently reduced by 50% of Excess Cash Flow. PXRE Group will deliver to the
Agent, concurrently with such prepayment, a certificate signed by a Financial
Officer of PXRE Group in form and substance satisfactory to the Agent and
setting forth the calculation of such Excess Cash Flow.

         1.3 Amendment to Section 2.9(a). Section 2.9(a) of the Existing Credit
Agreement is amended by deleting and replacing it in its entirety with the
following:

                                       6
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                  [2.9](a) To the Agent, for the account of the Lenders, an
         amendment fee in respect of the Second Amendment in an amount equal to
         (i) 0.50% of the Commitments as of January 1, 2002, payable on the
         earlier of (A) the Second Amendment Effective Date and (B) March 31,
         2002, which amount shall be deemed earned by the Lenders as of January
         1, 2002 plus (ii) 0.50% of the Commitments as of March 15, 2003,
         payable on March 15, 2003, provided that the portion of the fee
         described in this clause (ii) shall not become due or payable if the
         Commitments have been permanently reduced to zero prior to such date
         pursuant to Sections 2.5 (b), (c), (d) or (e).

         1.4 Amendment to Section 5.9(a)(ii). Section 5.9(a)(ii) of the Existing
Credit Agreement is amended by deleting and replacing it in its entirety with
the following:

                  [5.9(a)](ii) the Acquisition Amount with respect thereto
         (regardless of the form of consideration) (y) shall not exceed
         $35,000,000, and (z) together with the aggregate of the Acquisition
         Amounts (regardless of the form of consideration) for all other
         Permitted Acquisitions consummated on or after January 1, 2002, shall
         not exceed $50,000,000..

         1.5 Amendment to Section 6.1. Section 6.1 of the Existing Credit
Agreement is amended by deleting and replacing it in its entirety with the
following:

                  6.1 Leverage Ratio. The Leverage Ration shall not exceed 0.25
         to 1.0 at any time.

         1.6 Amendment to Section 6.2. Section 6.2 of the Existing Credit
Agreement is amended by adding the following proviso at the end thereof:

         ; provided that the Fixed Charge Coverage Ratio as of the last day of
         each of the fiscal quarters ending (i) March 31, 2002 and June 30, 2002
         shall not be less than 1.25 to 1.0 and (ii) September 30, 2002 and
         December 31, 2002 shall not be less than 1.30 to 1.0

         1.7 Amendment to Section 7.2(vii). Section 7.2(vii) of the Existing
Credit Agreement is amended by deleting and replacing it in its entirety with
the following:

                  [7.2](vii)  Indebtedness in respect of outstanding letters
         of credit, in the aggregate not to exceed twenty-five percent (25%) of
         the Statutory Capital and Surplus of PXRE Reinsurance at any time,
         issued on behalf of any Insurance Subsidiary for the benefit of Lloyd's
         to satisfy capital requirements imposed by Lloyd's to support such
         Insurance Subsidiary's business in the Lloyd's insurance Market, and
         Indebtedness in respect of reimbursement obligations in respect of
         letters of credit issued for the benefit of any Insurance Subsidiary or
         the Borrower in the ordinary course of its business to support the
         payment of obligations arising under insurance and reinsurance
         contracts (whether assumed or ceded finite reinsurance contracts (but
         not other ceded reinsurance contracts)) and swap agreements; and

         1.8 Amendment to Section 7.3(x). Section 7.3(x) of the Existing Credit
Agreement is amended by deleting and replacing it in its entirety with the
following:

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                  [7.3](x)  Liens on assets, not to exceed thirty percent
         (30%) of the Statutory Capital and Surplus of PXRE Reinsurance at any
         time, (x) pledged to secure letters of credit described in Section
         7.2(vii), (y) held in trust in the ordinary course of its business to
         support the payment of obligations arising under insurance and
         reinsurance contracts (whether assumed or ceded finite reinsurance
         contracts (but not other ceded reinsurance contracts)) or (z) held in
         trust for the benefit of Lloyd's to satisfy capital requirements
         imposed by Lloyd's to support an Insurance Subsidiary's business in the
         Lloyd's insurance Market; and

         1.9 Amendment to Section 7.4(vi). Section 7.4(vi) of the Existing
Credit Agreement is amended by deleting and replacing it in its entirety with
the following:

                  [7.4](vi)  the sale by PXRE Group and its Subsidiaries of
         (x) the capital stock or all or any portion of the assets, business or
         properties of a Subsidiary that is not a Material Subsidiary; (y) any
         asset or group of assets of an Insurance Subsidiary constituting less
         than (A) in any single transaction or series of related transactions,
         ten percent (10%) of Combined Statutory Capital and Surplus as of the
         last day of the fiscal quarter ending on or immediately prior to the
         date of such sale, and (B) during the term of this Agreement, in the
         aggregate with all such other sales pursuant to this clause (vi),
         twenty five percent (25%) of Combined Statutory Capital and Surplus as
         of the end of the immediately preceding fiscal quarter; and (z) any
         asset or group of assets of a non-Insurance Subsidiary constituting
         less than (A) in any single transaction or series of related
         transactions, ten percent (10%) of the total assets of the Borrower and
         its Subsidiaries on a consolidated basis, determined in accordance with
         GAAP as of the last day of the fiscal quarter ending on or immediately
         prior to the date of such sale, and (B) during the term of this
         Agreement, in the aggregate with all such other sales pursuant to this
         clause (vi), twenty five percent (25%) of the total assets of the
         Borrower and its Subsidiaries on a consolidated basis, determined in
         accordance with GAAP as of the end of the immediately preceding fiscal
         quarter; provided in the case of any sale pursuant to this clause (vi)
         that immediately after giving effect thereto, no Default or Event of
         Default would exist; and

         1.10 Amendment to Section 7.5(viii)(b). Section 7.5(viii)(b) of the
Existing Credit Agreement is amended by adding at the end thereof the following:

         provided that investments in hedge funds, limited partnerships or
         similar investments shall not constitute more than one-third (33%) of
         the Combined Statutory Capital and Surplus of the Borrower's Insurance
         Subsidiaries at any time;

         1.11 Amendment to Section 7.6(i). Section 7.6(i) of the Existing Credit
Agreement is amended by deleting and replacing it in its entirety with the
following:

                  [7.6](i)  PXRE Group may (A) declare and make dividend
         payments or other distributions to holders of PXRE Group's Capital
         Stock (including, without limitation, its common stock), in cash or in
         shares of such Capital Stock (and the Subsidiary of the Borrower that
         has issued Trust Preferred Securities may declare and make dividend
         payments or other distributions to holders of such Trust Preferred
         Securities), (B) cause the Borrower to make payments to any
         Subsidiary pursuant to Indebtedness related to any Trust Preferred
         Securities, and (C) purchase, redeem, retire or otherwise acquire
         shares of its Capital Stock, in cash or in-kind (and the Subsidiary of
         the Borrower that has issued Trust Preferred Securities may purchase,
         redeem, retire or otherwise acquire such Trust Preferred Securities, in
         cash or in-kind), provided that (x) dividends (whether in cash or other
         property or rights) paid with respect to the Capital Stock of PXRE
         Group (other than paid-in-kind dividends paid with respect to the
         Preferred Shares) in any fiscal year may not be more than ten percent
         (10%) greater than the dividends (whether in cash or other property or
         rights) paid with respect to the Capital Stock of PXRE Group during the
         prior fiscal year, (y) no cash dividends shall be paid with respect to
         the Preferred Shares unless a dividend paid in Capital Stock with
         respect to the Preferred Shares would cause the purchasers under the
         Preferred Share Purchase Agreement or their affiliates to own more than
         49.9% of the Capital Stock of PXRE Group on a fully-diluted and
         fully-converted basis and (z) the cash and other compensation paid
         pursuant to clause (C) above shall not have a fair market value in
         excess of the Permitted Redemption Amount, and provided further that in
         each case, immediately after giving effect thereto, (yy) no Default or
         Event of Default would exist, and (zz) the Fixed Charge Coverage Ratio
         would be at least 1.5 to 1.0, such ratio to be determined for purposes
         of this clause (i) as of the last day of the most recently ended fiscal
         quarter as if such dividend, distribution, payment or acquisition had
         been effected as of such date; and

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<PAGE>

         1.12 Amendment to Section 7.7(b)(iv). Section 7.7(b)(iv) of the
Existing Credit Agreement is amended by deleting and replacing it in its
entirety with the following:

                  [7.7(b)](iv)  loans from Borrower or any of its
         Subsidiaries to either Guarantor (A) up to an aggregate outstanding
         principal amount of $35,000,000 for the sole purpose of providing
         capital for PXRE Bermuda and (B) up to an aggregate outstanding
         principal amount of $3,000,000 for general corporate purposes, which
         loans shall not be required to be subordinated in time of payment to
         the Obligations so long as no Event of Default has occurred and is
         continuing; and

         1.13 Amendment to Section 7.8. Section 7.8 of the Existing Credit
Agreement is amended by deleting and replacing it in its entirety with the
following:

                  7.8  Lines of Business. The Borrower and the Guarantors
         will not, and PXRE Group will not permit or cause any of its
         Subsidiaries to, engage in any business other than (i) the businesses
         engaged in by it on the Second Amendment Effective Date and businesses
         and activities reasonably related thereto (including without limitation
         insurance management, agency and brokerage business undertaken through
         a Subsidiary other than a Material Subsidiary) or (ii) in the case of
         an Insurance Subsidiary, the offering and sale of any property and
         casualty reinsurance products or, in the case of PXRE Bermuda, life
         reinsurance products.

         1.14 Amendment to Section 7.14(i)(x). Section 7.14(i)(x) of the
Existing Credit Agreement is amended by deleting and replacing it in its
entirety with the following:

                                       9
<PAGE>

                           [7.14(i)](x) has placed assets in a trust with a
                  fiduciary and under terms, including investment restrictions
                  consistent with this Agreement, such that the ceding Insurance
                  Subsidiary shall be entitled to receive credit as admitted
                  reinsurance, under the requirements of the applicable
                  Insurance Regulatory Authority, for the reinsurer's share of
                  the obligations transferred pursuant to such Reinsurance
                  Agreement and either (A) the obligations of such reinsurer are
                  guaranteed by a direct or indirect parent thereof having
                  Standard & Poor's and A.M. Best & Company ratings of 'A-' or
                  better or (B) such reinsurer has capital and surplus as of the
                  date of purchase or renewal of such coverage of at least $1
                  billion;

         1.15 Amendment to Section 8.1(l). Section 8.1(l) of the Existing Credit
Agreement is amended by adding the following phrase at the end thereof:

         ; other than, in each case, the sale and issuance of the Preferred
         Shares to the purchasers under the Preferred Share Purchase Agreement
         and their Affiliates, the consummation of the Preferred Share
         Transactions, and the future conversion by such purchasers of the
         Preferred Shares pursuant to the terms thereof, provided that the
         purchasers under the Preferred Share Purchase Agreement and their
         Affiliates at no time own more than 49.9% of the Capital Stock of PXRE
         Group on a fully-diluted and fully-converted basis.

                                   ARTICLE II

                               CONSENT AND WAIVER

         2.1 Consent to Preferred Share Transactions. Subject to satisfaction of
the conditions set forth in Article IV, the Agent and the Lenders do hereby
consent to the Preferred Share Transactions on the terms set forth in the
Preferred Share Purchase Documents, which consent is limited as specified and
shall not constitute or be deemed to constitute an amendment, modification or
waiver of any provision of the Agreement or of any Default or Event of Default
except as expressly set forth herein.

         2.2 Limited Waiver for Certain Investment. The restriction under
Section 7.5(viii)(c) of the Existing Credit Agreement limiting the magnitude of
the Insurance Subsidiaries' Investments in the securities of any single issuer
is hereby waived through April 30, 2002 solely for the purpose of allowing PXRE
Reinsurance to continue to own certain Fixed Rate Secured Notes, due September
10, 2010, issued by FSL Funding Ltd. and guaranteed by Royal & Sun Alliance, and
having a face amount of $23 million. This limited waiver shall expire by its own
terms as of May 1, 2002 and shall not be deemed to constitute an amendment,
modification or waiver of any provision of the Existing Credit Agreement or
other Credit Document or of any Default or Event of Default except as expressly
set forth herein.

                                       10
<PAGE>

                                  ARTICLE III

                           CONDITIONS OF EFFECTIVENESS

         3.1 Conditions of Effectiveness. This Second 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
Second Amendment Effective Date and in sufficient executed originals for each
Lender:

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

                  (2) the Escrow Agreement, duly completed and executed by the
         Borrower, PXRE Group, the Agent and the escrow agent named therein; and

                  (3) the favorable opinion of Morgan, Lewis & Bockius, LLP,
         counsel to the Borrower and the Guarantors, in form reasonably
         satisfactory to the Agent and substantially covering such opinion
         matters as the Agent or any Lender 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 Second Amendment, the Existing
Credit Agreement (subject to the updating of the representations and warranties
therein pursuant to this Second Amendment) and the other Credit Documents are
true and correct as of the Second Amendment Effective Date, both immediately
before and after giving effect to the consummation of the Preferred Share
Transactions and the application of the proceeds thereof, (ii) no Default or
Event of Default has occurred and is continuing, both immediately before and
after giving effect to the consummation of the of the Preferred Share
Transactions and the application of the proceeds thereof, (iii) both immediately
before and after giving effect to the consummation of the of the Preferred Share
Transactions and the application of the proceeds thereof, no Material Adverse
Change has occurred since December 31, 2000, and there exists no event,
condition or state of facts that could reasonably be expected to result in a
Material Adverse Change, and (iv) all conditions to the consummation of the of
the Preferred Share Transactions have been satisfied and have not been waived or
amended without the prior written consent of the Required Lenders.

         (c) The Agent shall have received a certificate, signed by the
president or chief financial officer of each of the Borrower and PXRE Group
certifying that all of the proceeds from the sale and issuance of the Preferred
Shares, net of the reasonable expenses incurred in connection therewith and the
required deposit of funds into the Escrow Agreement, shall have been contributed
as capital to the Insurance Subsidiaries and describing the nature and amount of
such contributions in reasonable detail.

         (d) 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 no earlier than thirty (30) days prior to the Second 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
such Credit Party, as the case may be, 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 such Credit Party, as the case may
be, 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 such Credit Party authorizing the execution, delivery and
performance of this Second Amendment and the Preferred Share Purchase Documents
to which it is a party, and (iv) as to the incumbency and genuineness of the
signature of each officer of such Credit Party executing this Second Amendment.

                                       11
<PAGE>

         (e) The Credit Parties shall have duly complied with and performed all
of their agreements and conditions set forth in the Preferred Share Purchase
Documents required to be complied with or performed by them on or prior to the
Second Amendment Effective Date and the Agent shall have received evidence
satisfactory to it that (i) the Preferred Share Transactions shall have been
consummated in compliance with the Preferred Share Purchase Documents and all
applicable Requirements of Law and (ii) the proceeds from the sale and issuance
of the Preferred Shares, net of the reasonable expenses incurred in connection
therewith and the required deposit of funds pursuant to the Escrow Agreement,
shall have been contributed as capital to the Insurance Subsidiaries.

         (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, 2001, after giving effect to the consummation of the
Preferred Share Transactions.

         (g) The Preferred Share Purchase Documents shall not have been amended,
modified and supplemented, nor any condition or provision thereof waived, other
than as approved by the Agent and the Required Lenders and shall be in full
force and effect.

         (h) The Lenders shall have received a certificate as of a recent date
of the good standing or existence of each of the Credit Parties under the law of
their respective state or country of organization.

         (i) All approvals, permits and consents of any Governmental Authorities
or other Person required in connection with the execution and delivery of this
Second Amendment and the consummation of the Preferred Share Transactions 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 Second Amendment or the consummation of the Preferred Share
Transactions, or that, in the opinion of the Agent and the Required Lenders,
would otherwise be reasonably likely to have a Material Adverse Effect.

                                       12
<PAGE>

         (j) The Borrower shall have paid the fee that is due and payable under
Section 2.9(a), together with all other fees and expenses of the Agent and the
Lenders required hereunder or under any other Credit Document to be paid on or
prior to the Second Amendment Effective Date (including the reasonable fees and
expenses of counsel to the Agent) in connection with this Second Amendment and
the transactions contemplated hereby.

         (k) Each of the representations and warranties contained in the
Existing Credit Agreement, this Second Amendment and the other Credit Documents
shall be true and correct on and as of the Second 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 Preferred Share Transactions and
the application of the proceeds thereof, 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.

         (l) No Default or Event of Default shall have occurred and be
continuing, both immediately before and after giving effect to the consummation
of the Preferred Share Transactions and the application of the proceeds thereof.

         (m) The Agent and each Lender shall have received such other documents,
certificates, opinions and instruments in connection with the Preferred Share
Transactions and this Second. Amendment as it shall have reasonably requested.

                                   ARTICLE IV

                         REPRESENTATIONS AND WARRANTIES

         To induce the Agent and Lenders to enter into this Second Amendment and
to make the Loans, the Credit Parties each represent and warrant to the Agent
and each Lender, on the date hereof and on the Second Amendment Effective Date,
both before and after giving effect to the Preferred Share Transactions, as
follows (PXRE Group making such representations and warranties as to itself and
its Subsidiaries, the Borrower as to itself and its Subsidiaries and PXRE
Barbados as to itself only):

         4.1 Corporate Power. Each of the Guarantors, the Borrower and the
Material Subsidiaries has the full corporate power and authority to execute,
deliver and perform the Second Amendment and the Preferred Share Purchase
Documents to which it is or will be a party.

                                       13
<PAGE>

         4.2 Authorization; Enforceability. Each of the Borrower and the
Guarantors has taken, or on the date hereof will have taken, all necessary
corporate action to execute, deliver and perform each of the Second Amendment
and the Preferred Share Purchase Documents to which it is or will be a party,
and has validly executed and delivered the Second Amendment. The Second
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.

         4.3 No Violation. The execution, delivery and performance by each of
the Borrower and the Guarantors of this Second Amendment and the Preferred Share
Purchase Documents, 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 and the Guarantors of this Second Amendment and the Preferred Share
Purchase Documents or the legality, validity or enforceability hereof or
thereof, other than (i) consents, authorizations and filings that have been (or
on or prior to the Second Amendment Effective Date will have been) made or
obtained and that are (or on the Second Amendment Effective Date will be) in
full force and effect, which consents, authorizations and filings are listed on
Schedule 4.4 hereto and (ii) consents and filings the failure to obtain or make
which would not, individually or in the aggregate, have a Material Adverse
Effect.

                                   ARTICLE V

                                     GENERAL

         5.1 Full Force and Effect. Except as expressly amended hereby, the
Agreement shall continue in full force and effect in accordance with the
provisions thereof on the date hereof.

         5.2 Applicable Law. This Second 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 Second 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.

                                       14
<PAGE>

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

                                       15
<PAGE>

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

                                        PXRE CORPORATION

                                        By:     /s/ James F. Dore
                                                --------------------------------

                                        Name:       James F. Dore
                                                --------------------------------

                                        Title:     EVP & Chief Financial Officer
                                                --------------------------------

                                        PXRE GROUP LTD.

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

                                        Title:       EVP
                                                 -------------------------------

                                        PXRE REINSURANCE (BARBADOS) LTD.

                                        By:      /s/ Martin Hole
                                                 -------------------------------

                                        Name:        Martin Hole
                                                 -------------------------------

                                        Title:       VP
                                                 -------------------------------

                             (signatures continued)

                                       16
<PAGE>

                                        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 TZ FIRST NATIONAL
                                        BANK OF CHICAGO

                                        By:      /s/ Gretchen Roetzer
                                                 -------------------------------

                                        Name:        Gretchen Roetzer
                                                 -------------------------------

                                        Title:       Director
                                                 -------------------------------

                                        FLEET NATIONAL BANK

                                        By:      /s/ Eugene G. Ardito
                                                 -------------------------------

                                        Name:        Eugene G. Ardito
                                                 -------------------------------

                                        Title:       Director
                                                 -------------------------------

                                        CREDIT LYONNAIS NEW YORK BRANCH

                                        By:       /s/ Sebastian Rocco
                                                 -------------------------------

                                        Name:         Sebastian Rocco
                                                 -------------------------------

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

                                       17<PAGE>
                                                                   EXHIBIT 10.3

                                   ENDORSEMENT

                                       TO

                  FACULTATIVE OBLIGATORY RETROCESSION AGREEMENT
                    (hereinafter referred to as "Agreement")

                                     between

                            PXRE REINSURANCE COMPANY
                   (hereinafter referred to as the "Company")

                                       and

                           SELECT REINSURANCE COMPANY
                  (hereinafter referred to as the "Reinsurer")

It is understood and agreed that effective January 1, 2002, the participation of
the Reinsurer is amended to 8%.

Under terms of the Agreement, the Reinsurer agrees to assume severally and not
jointly with other participants a 8% share (being $1,600,000 per program) of the
liability described in the attached Agreement, and as consideration of the
above, the Reinsurer shall receive 8% of the premium named therein for cession
made on or after 12:01 a.m., January 1, 2002, local time, for business incepting
our renewing after that date.

Signed in Hamilton, Bermuda this 21st day of March, 2002.

                             SELECT REINSURANCE LTD.

                           BY:   /s/ Robert P. Myron
                              ----------------------------
                           TITLE: Sr. Vice President
                                 -------------------------

And in Edison, New Jersey this 19th day of March, 2002.

                            PXRE REINSURANCE COMPANY

                           BY:   /s/ Gordon Forsyth
                              ----------------------------

                           TITLE: Executive Vice President
                                 -------------------------

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