99 Front Street NEWS RELEASE
Hamilton HM12
Bermuda
441 296 5858
441 296 6162 FAX
PXRE Group Ltd. [PXRE LOGO]
Contact: Jeffrey L. Radke
Executive Vice President
(441) 296-5858
PXRE ANNOUNCES COMPLETION OF $150 MILLION PRIVATE EQUITY INVESTMENT
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COMPANY NAMES FOUR NEW DIRECTORS; TWO DIRECTORS RETIRE
HAMILTON, Bermuda (April 4, 2002) - PXRE Group Ltd. (NYSE: PXT) today announced
the successful completion of a $150 million equity investment by Capital Z
Financial Services Fund II, L.P., Reservoir Capital Partners, L.P., and Richard
Rainwater. The new capital, issued in the form of convertible preferred stock,
will enable PXRE to increase its underwriting capacity and therefore maximize
participation in the new market environment. Following completion of the
transaction, PXRE's total capital exceeds $500 million.
Commenting on the capital infusion, Gerald L. Radke, Chairman,
President and Chief Executive Officer of PXRE, said, "We believe that this
additional capital, combined with our longstanding broker and client
relationships, and existing record of client service, will allow us to build
upon the strong momentum we achieved during the year-end 2001 renewal season and
position PXRE for profitable growth in 2002. Given the lack of significant
catastrophe activity during the first quarter of 2002, we continue to expect
that our return on equity for 2002 will be in excess of our long term target of
15%."
In connection with the transaction, PXRE's new investors have
designated four seats on the Company's Board of Directors. The new board members
include: Bradley E. Cooper (35), Partner, Capital Z Financial Services Fund II,
L.P.; Susan S. Fleming (31), Partner, Capital Z Financial Services Fund II,
L.P.; Craig A. Huff (37), Managing Director, Reservoir Capital Partners, L.P.;
and Robert M. Stavis (39), Partner, Bessemer Venture Partners. Separately, two
of PXRE's current directors, Bernard Kelly (72) and David W. Searfoss (51), have
decided to retire effective with the closing of the investment transaction. As a
result, the Company's Board, which formerly comprised nine directors, has
expanded to 11 members.
"We extend our gratitude and sincere appreciation to Bernard and David
for their tireless efforts on behalf of PXRE over the last 15 years," Radke
added. "These gentlemen have devoted considerable time and energy to our Company
and the issues facing it in an increasingly complex time, and we are grateful
for their wise counsel and abiding interest in PXRE. At the same time, we
welcome our four new Board members and the financial expertise and industry
insight they bring to the Board. We look forward to their contributions to the
continued growth and prosperity of the Company."
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PXT Announce Completion of $150 Million Equity Investment
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April 4, 2002
PXRE - with operations principally in Bermuda, Barbados, the United
States, and Europe - provides reinsurance products and services to a worldwide
market place. The Company primarily emphasizes commercial and personal property
reinsurance risks and also provides marine and aerospace reinsurance products
and services. The Company's shares trade on the New York Stock Exchange under
the symbol PXT.
To request other printed investor material from PXRE or additional
copies of this news release, please call 441/296-5858, send e-mail to
Investor_Relations@pxregroup.com, or visit www.pxregroup.com.
Statements in this release that are not strictly historical are
forward-looking and are based upon current expectations and assumptions of
management. Statements included herein, as well as statements made by or on
behalf of PXRE in its communications and discussions with investors and analysts
in the normal course of business through meetings, phone calls and conference
calls, which are not historical in nature are intended to be, and are hereby
identified as, "forward-looking statements" for purposes of the safe harbor
provided by Section 21E of the Securities Exchange Act of 1934 as amended. These
forward-looking statements, identified by words such as "anticipate," "expect,"
"outlook," or variations of such words or similar expressions, are based upon
current expectations and are subject to risk and uncertainties. PXRE cautions
investors and analysts that actual results or events could differ materially
from those set forth or implied by the forward-looking statements and related
assumptions, depending on the outcome of certain important factors including,
but not limited to, the following: (i) significant catastrophe losses or losses
under other coverages, the timing and extent of which are difficult to predict;
(ii) changes in the level of competition in the reinsurance or primary insurance
markets that impact the volume or profitability of business (these changes
include, but are not limited to, the intensification of price competition, the
entry of new competitors, existing competitors exiting the market and
competitors' development of new products); (iii) changes in the demand for
reinsurance, including changes in the amount of ceding companies' retentions;
(iv) risks associated with the termination of PXRE's diversification
initiatives; (v) adverse development on loss reserves related to business
written in current and prior years; (vi) lower than estimated retrocessional
recoveries on unpaid losses, including the effects of losses due to a decline in
the creditworthiness of PXRE's retrocessionaires; (vii) increases in interest
rates, which cause a reduction in the market value of PXRE's interest rate
sensitive investments, including its fixed income investment portfolio and
potential underperformance in PXRE's finite coverages; (viii) decreases in
interest rates causing a reduction of income earned on net cash flow from
operations and the reinvestment of the proceeds from sales, calls or maturities
of existing investments and shortfalls in cash flows necessary to pay fixed rate
amounts due to structured contract counterparties; (ix) market fluctuations in
equity securities and with respect to PXRE's portfolio of hedge funds and other
privately held securities: leverage, concentration of investments, lack of
liquidity, market fluctuations and direction (including as a result of interest
rate fluctuations and direction, with respect to price levels and volatility
thereof) currency fluctuations, credit risk, yield curve risk, spread risk
between two or more similar securities, political risk, counterparty risk and
risks relating to settlements on foreign exchanges; (x) foreign currency
fluctuations resulting in exchange gains or losses; (xi) changes in the
composition of PXRE's investment portfolio; (xii) changes in tax laws, tax
treaties, tax rules and interpretations; and (xiii) changes in management's
evaluation of potential Year 2000 exposures emanating from its reinsurance
business. In addition to the factors outlined above that are directly related to
PXRE's business, PXRE is also subject to general business risks, including, but
not limited to, adverse state, federal or foreign legislation and regulation,
adverse publicity or news coverage, changes in general economic factors, the
loss of key employees and other factors set forth in PXRE's SEC filings. The
factors listed above should not be construed as exhaustive. Therefore, actual
results or outcomes may differ materially from what is expressed or forecasted
in such forward-looking statements.
PXRE undertakes no obligation to update any forward-looking statements,
whether as a result of new information, future events (including catastrophe
events), or otherwise.
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