UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 8-K
 
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934
 


Date of Report (Date of Earliest Event Reported)
May 12, 2016
   
AmTrust Financial Services, Inc.
(Exact name of registrant as specified in its charter)
 

Delaware
 
001-33143
 
04-3106389
(State or other jurisdiction
 
(Commission
 
(IRS Employer
of incorporation)
 
File Number)
 
Identification No.)
 

59 Maiden Lane, 43 rd  Floor, New York, New York
10038
(Address of principal executive offices)
 
(Zip Code)
 


Registrant’s telephone number, including area code
(212) 220-7120

 


 
(Former name or former address, if changed since last report.)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions ( see General Instruction A.2. below):
 

 
¨
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 

 
¨
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 

 
¨
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 

 
¨
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.133-4 (c))
 







Item 1.01
Entry into a Material Definitive Agreement.

Effective May 12, 2016, AmTrust Financial Services, Inc. (the “Company”) entered into Amendment No. 5(“Amendment”) to its Credit Agreement dated September 12, 2014, with JPMorgan Chase Bank, N.A., as Administrative Agent, KeyBank National Association and SunTrust Bank, as Co-Syndication Agents, Lloyds Bank PLC and Associated Bank, as Co-Documentation Agents, and the various lending institutions party thereto (as amended from time to time, the “Credit Agreement”). The Amendment expands the restrictive covenant related to repurchase by the Company of shares of its outstanding common stock to allow for repurchase of up to an aggregate repurchase price of $300 million during the facility term.

The description of the Amendment is qualified in its entirety by reference to the full text of the Amendment, which is filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.

Item 8.01
Other Events.

On April 15, 2016, subject to the Company entering into the Amendment, the Company’s Board of Directors approved an increase to the Company’s existing stock repurchase authorization approved by the Company’s Board of Directors on December 31, 2013 to incorporate the increase permitted by the Amendment. The number, price, structure and timing of the repurchases, if any, will be at the Company’s sole discretion and subject to the limitations imposed by the Amendment. Repurchases will be evaluated by the Company depending on market conditions, liquidity needs and other factors. Further, the purchases will be subject to applicable securities laws and regulations, including Rule 10b5-1 and Rule 10b-18 under the Securities Exchange Act of 1934, as amended. The Board of Directors may suspend, modify or terminate the repurchase program at any time without prior notice. Under this repurchase program, the Company is not obligated to repurchase any particular number of shares.

Item 9.01
Exhibits.

(d)
Exhibits.

Exhibit No.
 
Description
 
 
 
10.1
 
Amendment No. 5, dated May 12, 2016, to the Credit Agreement, dated September 12, 2014, among the Company, JPMorgan Chase Bank, N.A., as Administrative Agent, and the various lending institutions party thereto.







SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. 
 

 
AmTrust Financial Services, Inc.
 
(Registrant)
 

Date
May 12, 2016
 

 
/s/ Stephen Ungar
 
Stephen Ungar
 
Senior Vice President, General Counsel and Secretary
 



EXHIBIT 10.1
AMENDMENT NO. 5
Dated as of May 12, 2016
to
CREDIT AGREEMENT
Dated as of September 12, 2014
THIS AMENDMENT NO. 5 (“ Amendment ”) is made as of May 12, 2016 and shall, upon satisfaction of the conditions precedent set forth in Section 2 below be effective as of the date hereof (the “ Amendment No. 5 Effective Date ”) by and among AmTrust Financial Services, Inc., a Delaware corporation (the “ Borrower ”), the financial institutions listed on the signature pages hereof and JPMorgan Chase Bank, N.A., as Administrative Agent (the “ Administrative Agent ”), under that certain Credit Agreement dated as of September 12, 2014, by and among the Borrower, the Lenders and the Administrative Agent (as amended, restated, supplemented or otherwise modified from time to time prior to the date hereof, the “ Credit Agreement ”). Capitalized terms used herein and not otherwise defined herein shall have the respective meanings given to them in the Credit Agreement.
WHEREAS, the Borrower has requested that the requisite Lenders and the Administrative Agent agree to make certain modifications to the Credit Agreement;
WHEREAS, the Borrower, the Lenders party hereto and the Administrative Agent have so agreed on the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the premises set forth above, the terms and conditions contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Borrower, the Lenders party hereto and the Administrative Agent hereby agree to enter into this Amendment.
1. Amendments to Credit Agreement . Effective as of the Amendment No. 5 Effective Date but subject to the satisfaction of the conditions precedent set forth in Section 2 below, the Credit Agreement is hereby amended as follows:
(a)      The definition of “Defaulting Lender” set forth in Section 1.01 of the Credit Agreement is amended to amend and restate clause (d) thereof to read as “(d) has become the subject of (A) a Bankruptcy Event or (B) a Bail-In Action.”
(b)      Section 1.01 of the Credit Agreement is amended to add the following definitions thereto in the appropriate alphabetical order:
Bail-In Action ” means the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.





Bail-In Legislation ” means, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.
EEA Financial Institution ” means (a) any institution established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.
EEA Member Country ” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.
EEA Resolution Authority ” means any public administrative authority or any Person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.
EU Bail-In Legislation Schedule ” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor Person), as in effect from time to time.
Write-Down and Conversion Powers ” means, with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.
(c)      Section 2.21 of the Credit Agreement is amended to add the words “or a Bail-In Action” immediately after the words “a Bankruptcy Event” appearing therein.
(d)      Article III of the Credit Agreement is amended to add a new Section 3.20 thereto immediately at the end thereof as follows:
Section 3.20 EEA Financial Institutions . The Borrower is a not an EEA Financial Institution.
(e)      Section 6.07(e) of the Credit Agreement is amended to replace the reference to “$150,000,000” appearing therein with “$300,000,000”.
(f)      Article IX of the Credit Agreement is amended to add a new Section 9.17 thereto immediately at the end thereof as follows:
Section 9.17 Acknowledgement and Consent to Bail-In of EEA Financial Institutions . Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any EEA Financial Institution arising under any Loan Document may be subject to the write-down and conversion powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:


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(a)      the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an EEA Financial Institution; and
(b)      the effects of any Bail-In Action on any such liability, including, if applicable:
(i)      a reduction in full or in part or cancellation of any such liability;
(ii)      a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEA Financial Institution, its parent entity, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or
(iii) the variation of the terms of such liability in connection with the exercise of the write-down and conversion powers of any EEA Resolution Authority.
2.      Conditions of Effectiveness . The effectiveness of this Amendment is subject to the conditions precedent that the Administrative Agent shall have received (i) counterparts of this Amendment duly executed by the Borrower, the Required Lenders and the Administrative Agent and (ii) payment and/or reimbursement of the Administrative Agent’s and its affiliates’ fees and expenses (including, to the extent invoiced, the reasonable fees and expenses of counsel for the Administrative Agent) in connection with this Amendment.
3.      Representations and Warranties of the Borrower . The Borrower hereby represents and warrants as follows:
(a)      This Amendment and the Credit Agreement as amended hereby constitute legal, valid and binding obligations of the Borrower and are enforceable against the Borrower in accordance with their terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.
(b)      As of the date hereof and giving effect to the terms of this Amendment, (i) no Default or Event of Default shall have occurred and be continuing and (ii) the representations and warranties of the Borrower set forth in the Credit Agreement, as amended hereby, are true and correct as of the date hereof.
4.      Reference to and Effect on the Credit Agreement .
(a)      Upon the effectiveness hereof, each reference to the Credit Agreement in the Credit Agreement or any other Loan Document shall mean and be a reference to the Credit Agreement as amended hereby.
(b)      Each Loan Document and all other documents, instruments and agreements executed and/or delivered in connection therewith shall remain in full force and effect and are hereby ratified and confirmed.


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(c)      Except with respect to the subject matter hereof and as set forth herein, the execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of the Administrative Agent or the Lenders, nor constitute a waiver of any provision of the Credit Agreement, the Loan Documents or any other documents, instruments and agreements executed and/or delivered in connection therewith.
(d)      This Amendment shall be a Loan Document.
5.      Governing Law . This Amendment shall be construed in accordance with and governed by the law of the State of New York.
6.      Headings . Section headings in this Amendment are included herein for convenience of reference only and shall not constitute a part of this Amendment for any other purpose.
7.      Counterparts . This Amendment may be executed by one or more of the parties hereto on any number of separate counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument.
[Signature Pages Follow]


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IN WITNESS WHEREOF, this Amendment has been duly executed as of the day and year first above written.

AMTRUST FINANCIAL SERVICES, INC.,
as the Borrower


By: /s/ Ronald E. Pipoly, Jr.            
Name: Ronald E. Pipoly, Jr.
Title: Executive Vice President, Chief Financial Officer


JPMORGAN CHASE BANK, N.A.,
individually as a Lender, as Issuing Bank and as Administrative Agent


By: /s/ Hector J. Varona                
Name: Hector J. Varona
Title: Executive Director


KEYBANK NATIONAL ASSOCIATION,
as a Lender


By: /s/ James Cribbet                
Name: James Cribbet
Title: Senior Vice President


SUNTRUST BANK,
as a Lender


By: /s/ Paula Mueller                
Name: Paula Mueller
Title: Director



Signature Page to Amendment No. 5 to
Credit Agreement dated as of September 12, 2014
AmTrust Financial Services, Inc.




LLOYDS BANK PLC,
as a Lender


By: /s/ Erin Doherty                
Name: Erin Doherty - D006
Title: Assistant Vice President


By: /s/ Dennis McClellan            
Name: Dennis McClellan - M040
Title: Assistant Vice President


ASSOCIATED BANK, NATIONAL ASSOCIATION
as a Lender


By: /s/ Edward J. Chidiac            
Name: Edward J. Chidiac
Title: Senior Vice President


THE PRIVATEBANK AND TRUST COMPANY, as a Lender


By: /s/ Austin G. Love                
Name: Austin G. Love
Title: Assistant Managing Director


Signature Page to Amendment No. 5 to
Credit Agreement dated as of September 12, 2014
AmTrust Financial Services, Inc.