EXHIBIT 10(X)
November 17, 1998
Southern Heritage Limited Partnership
0000 Xxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxx Xxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx, General Partner
Re: Stock Purchase Agreement (the "Agreement") dated as of
May 14, 1998 between Donegal Group Inc. ("DGI") and
Southern Heritage Limited Partnership (the "Partnership")
Dear Xxxx:
The purpose of this letter is to set forth in writing the agreements we
have reached as to certain changes to the Agreement as follows:
1. Section 6.2 of the Agreement is hereby amended and restated so that, as
amended and restated, Section 6.2 of the Agreement shall read in its entirety as
follows:
"6.2 Purchase and Sale. On the Closing Date, DGI shall
purchase from the Partnership, and the Partnership shall sell to DGI,
the Shares for a purchase price of $19,166,670 (the "Purchase
Price")." In addition, DGI and the Partnership have entered into an
escrow agreement (the "Escrow Agreement") of even date herewith with
Duane, Morris & Heckscher LLP as escrow agent (the "Escrow Agent") for
the purpose, inter alia, of setting forth a process for the
determination of the accuracy of the premium balance receivable of the
Company as set forth in its balance sheet as of October 31, 1998 (the
"Balance Sheet") and other items reflected on the Balance Sheet that
would change if there were a change in the premium balance receivable
as of such date (collectively, the "Premium Balance"). If the final
determination of the Premium Balance as contemplated by the Escrow
Agreement results in a Premium Balance in excess of the amount thereof
reflected on the Balance Sheet, the amount of such excess, up to a
maximum of $1,908,333, shall be paid by DGI to the Partnership by wire
transfer of immediately available funds in such amount to such account
as the Partnership specifies to DGI in writing. If the final
determination of the Premium Balance as contemplated by the Escrow
Agreement results in a Premium Balance less than the amount thereof
reflected on the Balance Sheet, the
Southern Heritage Limited Partnership
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November 17, 1998
amount of such deficiency, net of disbursements of the Funds (as
defined in the Escrow Agreement) by the Escrow Agent to DGI, shall be
paid by the Partnership to DGI by wire transfer of immediately
available funds in such amount to such account as DGI specifies to the
Partnership in writing."
2. Section 6.4 of the Agreement is hereby amended and restated so that, as
amended and restated, Section 6.4 of the Agreement shall read in its entirety as
follows:
"6.4 Delivery by DGI. In addition to the deliveries called
for by Article VIII hereof, DGI shall make payment of the Purchase
Price as follows: (a) the Xxxxx-Southern Heritage Loan Repayment
Amount of $3,908,290.32 shall be paid by wire transfer of immediately
available funds in such amount to Xxxxx Bank, N.A. to the account of
Southern Heritage Holdings, Inc. which, for all purposes of the Agree-
ment, shall constitute payment for the account of the Partnership; (b)
$14,508,379.68 shall be paid by wire transfer of immediately available
funds in such amount to the Partnership to such account as the
Partnership specifies in writing to DGI and (c) $750,000 shall be paid
by wire transfer of immediately available funds in such amount to the
Escrow Agent as set forth in the Escrow Agreement in the form of
Exhibit A hereto."
3. Section 9.1(b) of the Agreement is hereby amended and restated so that,
as amended and restated, Section 9.1(b) of the Agreement shall read in its
entirety as follows:
"(b) by either DGI or the Partnership by one day's written
notice to the Partnership or DGI, as the case may be, if the Closing
shall not have been consummated on or before August 31, 1998;
provided, however, that if any of the Required Filings and Approvals
shall not have been received by August 31, 1998 such date shall be
extended without any action by or on behalf of the parties hereto
until five business days after all such Required Filings and Approvals
shall have been received but in no event later than November 17, 1998
and further provided that the right to terminate this Agreement under
this Section 9.1(b) shall not be available to any party whose failure
to fulfill any obligation under this Agreement has been the cause of,
or resulted in, the failure of the purchase and sale of the Shares to
have been consummated on or before such date;"
4. Except as specifically provided herein, the agreements, covenants and
conditions set forth in the Agreement are hereby expressly confirmed and
ratified and shall remain in full force and effect.
5. All capitalized terms used herein but not defined herein shall have the
respective meanings assigned to them in the Agreement.
Southern Heritage Limited Partnership
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November 17, 1998
If the foregoing correctly sets forth our agreements, please sign this
letter where indicated and return it to me.
Sincerely,
Xxxxxx X. Xxxxxxxx,
President and Chief Executive Officer
Accepted and agreed to, intending
to be legally bound hereby, this
17th day of November 1998:
SOUTHERN HERITAGE LIMITED
PARTNERSHIP
By: ___________________________________
Xxxxxxx X. Xxxxxx, General Partner