SECOND AMENDMENT TO CREDIT AGREEMENT

 

SECOND AMENDMENT TO CREDIT AGREEMENT (this “Second Amendment”), dated as of April 18, 2007, among PARTNERRE LTD., a company organized under the laws of Bermuda (the “Borrower”), the Designated Subsidiary Borrowers party to the Credit Agreement referred to below, the lenders party to the Credit Agreement referred to below (each, a “Lender” and, collectively, the “Lenders”) and JPMORGAN CHASE BANK, N.A. (“JPMorgan Chase”), as Administrative Agent (in such capacity, the “Administrative Agent”).  All capitalized terms used herein and not otherwise defined shall have the respective meanings provided such terms in the Credit Agreement.

 

 

W I T N E S S E T H:

 

WHEREAS, the Borrower, the Designated Subsidiary Borrowers, the Lenders and the Administrative Agent are parties to a Credit Agreement, dated as of June 17, 2004 and amended and restated as of September 30, 2005 (as in effect on the date hereof, the “Credit Agreement”); and

 

WHEREAS, the parties hereto desire to make certain modifications to the Credit Agreement as set forth herein;

 

NOW, THEREFORE, it is agreed:

 

I.           Second Amendment to Credit Agreement.

 

1.  The definition of “Consolidated Net Worth” appearing in Section 10 of the Credit Agreement is hereby amended to read in its entirety as follows:

 

““Consolidated Net Worth” shall mean, as of any date of determination, the Net Worth of the Company and its Subsidiaries on such date determined on a consolidated basis, plus, to the extent not otherwise included in Net Worth, the then issued and outstanding amount of all Qualified Mandatorily Convertible Preferred Securities; provided, that the nominal value of any securities issued in respect of any Hybrid Securities shall constitute stockholders equity to the extent (x) the accreted value of such securities does not exceed the HS Exclusion Amount and (y) S&P does not include such securities as financial leverage.”

2.  The definition of “Debt” appearing in Section 10 of the Credit Agreement is hereby amended to read in its entirety as follows:

 

““Debt” of any Person shall mean at any date, without duplication, (i) all obliga­tions of such Person for borrowed money, (ii) all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments, (iii) all obligations of such Person to pay the deferred purchase price of property or services, except trade accounts payable arising in the ordinary course of business, (iv) all obligations of such Person as lessee

under capital leases, (v) all obligations of such Person to reimburse any bank or other Person in respect of amounts pay­able under a banker’s acceptance, (vi) all Redeemable Preferred Stock of such Person (in the event such Person is a corporation), (vii) all obligations (absolute or contingent) of such Person to reimburse any bank or other Person in respect of amounts paid under a letter of credit or similar instrument, (viii) all Debt of others secured by a Lien on any asset of such Person,  whether or not such Debt is assumed by such Person, and (ix) all Debt of others Guaranteed by such Person; provided, that (A) for the avoidance of doubt, insurance payment liabilities, as such, and liabilities arising in the ordinary course of such Person’s business as an insurance or reinsur­ance company (including GICs) or a corporate member of The Council of Lloyd’s or as a pro­vider of financial or investment services or contracts (in each case other than in connection with the provision of financing to such Person or any of such Person’s Affiliate) shall not constitute Debt, and (B) solely for purposes of Section 8.10 and the definition of “Consolidated Total Debt,” “Debt” shall not include (I) any contingent obligations of any Person under or in connection with acceptance, letter of credit or similar facilities so long as no drawings or pay­ments have been made in respect thereof, (II) obligations of the Company in respect of any Redeemable Preferred Stock that is part of a unit which constitutes Qualified Mandatorily Convertible Preferred Securities, but only up until such time as such Redeemable Preferred Securities are remarketed in connection with the settlement of the related contract for the purchase and sale of the Company’s ordinary common shares and (III) the indebtedness evidenced by all outstanding Hybrid Securities to the extent (x) the accreted value of such indebtedness does not exceed the HS Exclusion Amount and (y) S&P does not include such Indebtedness under such Hybrid Securities as financial leverage.”

3.  Section 10 of the Credit Agreement is hereby further amended by inserting therein the following new definitions immediately after the definition of “Guaranteed Obligations”:

““HS Exclusion Amount” shall mean, on the date of determination, an amount equal to 15% of Consolidated Total Capitalization.

 

“Hybrid Securities Issue” shall mean an issue of Hybrid Securities.

 

“Hybrid Securities” shall mean an offering of junior subordinated debentures or other subordinated securities of the Company either directly or through a Subsidiary that is a special purpose vehicle created in connection with such offering.”

 

4.  Section 10 of the Credit Agreement is hereby further amended by deleting therefrom the definition of “Debentures”.

 

5.  Section 10 of the Credit Agreement is hereby further amended by deleting therefrom the definition of “Qualified Trust Preferred Securities”.

 

6.  Section 10 of the Credit Agreement is hereby further amended by deleting therefrom the definition of “Special Purpose Trust”.

 

II.           Miscellaneous Provisions.

 

1.           In order to induce the Lenders to enter into this Second Amendment, the Company hereby represents and warrants that:

 

(a)           no Default or Event of Default exists on the Second Amendment Effective Date (as defined below), immediately after giving effect to this Second Amendment; and

 

(b)           all of the representations and warranties contained in the Credit Agreement and the other Credit Documents are true and correct in all material respects on and as of the Second Amendment Effective Date immediately after giving effect to this Second Amendment, with the same effect as though such representations and warranties had been made on and as of the Second Amendment Effective Date (it being understood that any repre­sen­tation or warranty made as of a specific date shall be true and correct in all material respects as of such specific date).

 

2.           This Second Amendment is limited as specified and shall not constitute a modifi­cation, acceptance or waiver of any other provision of the Credit Agreement or any other Credit Document.

 

3.           This Second Amendment may be executed in any number of counterparts and by the different parties hereto on separate counterparts, each of which counterparts when executed and delivered shall be an original, but all of which shall together constitute one and the same instrument.  A complete set of counterparts shall be lodged with the Borrower and the Administrative Agent.

 

4.          THIS SECOND AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK.

 

5.          This Second Amendment shall become effective on the date (the “Second Amendment Effective Date”) when the Borrower, each Designated Subsidiary Borrower and the Required Lenders shall have signed a counterpart hereof (whether the same or different counter­parts) and shall have delivered (including by way of facsimile transmission) the same to White & Case LLP, 1155 Avenue of the Americas, New York, New York 10036, Attention:  May Yip-Daniels (facsimile:   ###-###-####).

 

6.           From and after the Second Amendment Effective Date all references in the Credit Agreement and each of the other Credit Documents to the Credit Agreement shall be deemed to be a reference to the Credit Agreement as modified hereby on the Second Amendment Effective Date, pursuant to the terms of this Second Amendment.

 

*     *     *

IN WITNESS WHEREOF, the parties hereto have caused their duly authorized officers to execute and deliver this Second Amendment as of the date first above written.

 

	PARTNERRE LTD.
	By:	/s/ Patrick Thiele
		Name: Patrick Thiele
		Title: President