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Exhibit 10.1
August 11, 1999
Delphi Financial Group, Inc.
1105 North Market Street
Suite 1230
Wilmington, Delaware 19801
Re: Waiver and Amendment
Ladies and Gentlemen:
We make reference to that certain Third Amended and Restated
Credit Agreement, dated as of December 5, 1996 (as amended or modified to date,
the "Credit Agreement"), among Delphi Financial Group, Inc. ("Delphi"), the
co-agents party thereto (the "Co-Agents"), the lenders party thereto (the
"Lenders") and Bank of America, N.A. (as successor by merger to Bank of America
National Trust and Savings Association), as administrative agent (the
"Administrative Agent"). Capitalized terms used herein and not otherwise defined
shall have the meanings provided in the Credit Agreement.
We understand that, absent the waiver provided for herein, an
Event of Default would exist under Section 10.6 of the Credit Agreement (Capital
Expenditures) as a result of Delphi exceeding the limit on Consolidated Capital
Expenditures by approximately $3,000,000 as of the Fiscal Quarter ended June 30,
1999. We also understand that Delphi has requested that (a) the Event of Default
resulting from its violation of Section 10.6 of the Credit Agreement be waived
by the Lenders, (b) Section 10.6 of the Credit Agreement be deleted and (c)
Section 9.4 of the Credit Agreement be amended to provide, among other things,
that any unused dividend and stock repurchase/redemption capacity in any given
Fiscal Year be carried forward to succeeding Fiscal Years.
Each of the undersigned hereby:
(a) waives any Event of Default resulting from Delphi's
violation of Section 10.6 of the Credit Agreement as of the Fiscal
Quarter ended June 30, 1999;
(b) agrees that Section 10.6 of the Credit Agreement shall be
deleted in its entirety and replaced with the following:
"SECTION 10.6. [Intentionally Omitted]."
(c) agrees that Section 9.4 of the Credit Agreement shall be
deleted in its entirety and replaced with the following:
"SECTION 9.4 Dividends, etc. Except for (a) dividends
made on preferred stock of the Borrower when no Default has
occurred, (b) dividends made on common stock of the Borrower
and the repurchase or redemption of capital stock of the
Borrower, in each case, when no Default has occurred and which
do not, in the aggregate in any Fiscal Year, exceed 4% of the
Consolidated Equity of the Borrower as of December 31 of the
Fiscal Year immediately
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preceding the Fiscal Year in which such dividend, repurchase
or redemption is to be made; provided, that, solely for the
Borrower's 1999 Fiscal Year, dividends made on common stock of
the Borrower and repurchases or redemptions of capital stock
of the Borrower shall be permitted when no Default has
occurred and which do not, in the aggregate, exceed 4% of the
Consolidated Equity of the Borrower as of June 30, 1999, plus
the amount of any repurchases of common stock of the Borrower
made by the Borrower from January 1, 1999 to August 11, 1999
(approximately $29,000,000); and provided, further, that to
the extent the aggregate amount of such dividends, repurchases
or redemptions in any Fiscal Year is less than the amount
permitted for such Fiscal Year, the Borrower may carry over
the additional amount to any succeeding Fiscal Year, and (c)
in addition to clauses (a) and (b), repurchases of capital
stock of the Borrower when no Default has occurred in an
aggregate amount not to exceed $20,000,000 during the term of
this Agreement, not (i) declare, pay or make any dividend or
distribution (in cash, property or obligations) on any shares
of any class of capital stock (now or hereafter outstanding)
of the Borrower or on any warrants, options or other rights
with respect to any shares of any class of capital stock (now
or hereafter outstanding) of the Borrower (other than
dividends or distributions payable in its common stock or
warrants to purchase its common stock or splitups or
reclassifications of its stock into additional or other shares
of its common stock) or apply, or permit any of its
Subsidiaries to apply, any of its funds, property or assets to
the purchase, redemption, sinking fund or other retirement of
any shares of any class of capital stock (now or hereafter
outstanding) of the Borrower or any option, warrant or other
right to acquire shares of the Borrower's capital stock (other
than any such payment pursuant to stock appreciation rights
granted and exercised in accordance with applicable rules and
regulations of the Securities and Exchange Commission); or
(ii) make any deposit for any of the foregoing purposes."
(d) acknowledges that Delphi's address for notices pursuant to
Section 15.2 of the Credit Agreement shall be as follows:
1105 North Market Street, Suite 1230
Wilmington, Delaware 19899
Attention: Robert Rosenkranz
Telephone: (302) 478-5142
Facsimile: (302) 427-7663
with a copy to:
Delphi Capital Management, Inc.
153 East 53rd Street, 49th Floor
New York, New York 10022
Attention: General Counsel
Telephone: (212) 838-7000
Facsimile: (212) 838-7598
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In consideration of the foregoing waiver and amendment, Delphi
hereby represents and warrants to the Lenders and the Administrative Agent that:
(a) The execution, delivery and performance of this agreement
is within the Delphi's authority (corporate or otherwise), has been
duly authorized by all necessary action, has received all necessary
consents and approvals (if any shall be required), and does not and
will not contravene or conflict with any provision of law or of the
charter, bylaws or other organizational documents of Delphi or its
Subsidiaries, or of any other agreement binding upon Delphi or its
Subsidiaries or their respective property;
(b) This agreement constitutes the legal, valid, and binding
obligation of Delphi, enforceable against Delphi in accordance with its
terms;
(c) Except for any Default or Event of Default waived by the
terms of this agreement, no Default or Event of Default has occurred
and is continuing or will result from the terms set forth in this
consent agreement; and
(d) The representations and warranties of Delphi set forth in
Section 7 of the Credit Agreement are true and correct as if made on
the date hereof, except any such representation or warranty which
speaks to a specific date.
Notwithstanding anything contained in the foregoing to the
contrary, the waiver and amendment granted hereunder will not in any way operate
as an amendment or modification of the Credit Agreement, or any other Loan
Document or a consent or waiver with respect to any existing or future Default
or Event of Default not specifically enumerated above.
This letter agreement may be executed in counterparts and each
such counterpart shall be one and the same agreement.
The parties agree that facsimile signatures shall be deemed to
be original signatures for purposes of this letter agreement.
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If the foregoing is in accordance with your understanding and
is acceptable to you, please so indicate by executing this letter in the space
provided below and returning the original to Michael L. Boykins at McDermott,
Will & Emery, 227 West Monroe Street, Chicago, Illinois 60606 and faxing a copy
of your executed signature page to Mr. Boykins at (312) 984-7700.
Very truly yours,
ADMINISTRATIVE AGENT:
BANK OF AMERICA, N.A. (as successor by
merger to Bank of America National Trust
and Savings Association)
By: _____________________________________
Name: ___________________________________
Title: __________________________________
LENDERS:
BANK OF AMERICA, N.A. (as successor by
merger to Bank of America National Trust
and Savings Association)
By: _____________________________________
Name: ___________________________________
Title: __________________________________
BANK OF MONTREAL
By: _____________________________________
Name: ___________________________________
Title: __________________________________
THE BANK OF NEW YORK
By: _____________________________________
Name: ___________________________________
Title: __________________________________
CORESTATES BANK, N.A.
By: _____________________________________
Name: ___________________________________
Title: __________________________________
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DEUTSCHE BANK AG, NEW YORK AND/OR
CAYMAN ISLANDS BRANCHES
By: _____________________________________
Name: ___________________________________
Title: __________________________________
By: _____________________________________
Name: ___________________________________
Title: __________________________________
DRESDNER BANK AG, NEW YORK BRANCH
AND/OR GRAND CAYMAN BRANCH
By: _____________________________________
Name: ___________________________________
Title: __________________________________
By: _____________________________________
Name: ___________________________________
Title: __________________________________
MELLON BANK, N.A.
By: _____________________________________
Name: ___________________________________
Title: __________________________________
FLEET NATIONAL BANK
By: _____________________________________
Name: ___________________________________
Title: __________________________________
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Agreed and Accepted this ___ day
of August, 1999.
DELPHI FINANCIAL GROUP, INC.
By: ______________________________
Name: ____________________________
Title: ___________________________