Exhibit 10.1 


 


Execution Version


 


FIRST AMENDMENT TO CREDIT AGREEMENT


 


THIS FIRST AMENDMENT
TO CREDIT AGREEMENT (the “First Amendment” or this “Amendment”), dated effective
as of December 31, 2015, is entered into by and among STEWART INFORMATION SERVICES CORPORATION, a Delaware corporation (the “Borrower”),
each of the entities listed on the signature pages hereof as guarantors (the “Guarantors”) and COMPASS
BANK, N.A., as administrative agent (the “Administrative Agent”) for the lenders to the Credit Agreement referred to
below (the “Lenders”) and the Lenders party hereto.


 


PRELIMINARY STATEMENT


 


WHEREAS, the
Borrower, the Guarantors, the Administrative Agent and the Lenders entered into that certain Credit Agreement dated as of October 21,
2014 (as may be amended from time to time, the “Credit Agreement”), pursuant to which the Lenders agreed
to make available to the Borrower a revolving credit commitment. All capitalized terms used in this Amendment and not otherwise
defined herein shall have the meanings ascribed to such terms in the Credit Agreement; and


 


WHEREAS, the
Borrower has now asked the Lenders to amend certain provisions of the Credit Agreement; and


 


WHEREAS, the
Lenders are willing do so subject to the terms and conditions set forth herein, provided that the Borrower and Guarantors ratify
and confirm all of their respective obligations under the Credit Agreement and the Loan Documents;


 


NOW, THEREFORE,
in consideration of the premises and further valuable consideration, the receipt and sufficiency of which is hereby acknowledged,
the parties hereto agree as follows:


 


1.Amendment.
As of the First Amendment Effective Date, the Credit Agreement is amended as follows:


 


(a)The following
definitions in Section 1.01 of the Credit Agreement are hereby amended and restated in its entirety as follows:


 


“Change
in Control” means (a) any “person” or “group” (as such terms are used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, but excluding any employee benefit plan of such person or its subsidiaries, and any
person or entity acting in its capacity as trustee, agent or other fiduciary or administrator of any such plan) that becomes the
“beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934), except that a person
or group shall be deemed to have “beneficial ownership” of all securities that such person or group has the right to
acquire (such right, an “option right”), directly or indirectly, of 40% or more of the Equity Interests of the
Borrower entitled to vote for members of the board of directors or equivalent governing body of the borrower on a fully-diluted
basis (and taking into account all such securities that such “person” or “group” has the right to acquire
pursuant to any option right); or (b) during any period of 24 consecutive months, a majority of the members of the board of directors
or other equivalent governing body of the Borrower ceases to be composed of individuals (i) who were members of that board or equivalent
governing body on the first day of such period, (ii) whose election or nomination to that board or equivalent governing body was
approved by individuals referred to in clause (i) above constituting at the time of such election or nomination at least a majority
of that board or equivalent governing body or (iii) whose election or nomination to that board or other equivalent governing body
was approved by Individuals referred to in clauses (i) and (ii) above constituting at the time of such election or nomination at
least a majority of that board or equivalent governing body.


 






     


     

    

 


“EBITDA”
means, for any period, without duplication, the Consolidated Net Income for such period, plus cash Interest Expense, income
tax expense, depreciation, amortization and income attributable to non-controlling interests, in each case for the Borrower and
its Subsidiaries on a consolidated basis; provided that the calculation of EBITDA shall exclude the non-cash impairment
charge in the amount of $35,900,000 for the fiscal quarter ended September 30, 2015.


 


(b)Section 5.01 of
the Credit Agreement is hereby amended by amending and restating subsection (d) to read as follows:


 


“(d)promptly
after the same become publicly available, copies of all periodic and other reports, proxy statements and other materials filed
by the Borrower or any Subsidiary with the Securities and Exchange Commission, or any Government Authority succeeding to any or
all of the functions of said Commission, or with national securities agencies (other than immaterial correspondence filed in the
ordinary course of business, and comment letters received from the Securities and Exchange Commission or responses thereto), or
distributed by the Borrower or any subsidiary thereof to its shareholders generally, as the case may be; provided, that the Borrower
shall be deemed to have delivered the foregoing to the Administrative Agent and the Lenders if such information has been filed
with the Securities and Exchange Commission and is available on the Edgar site at www.sec.gov or any successor government site
that is freely and readily available to the Administrative Agent and the Lenders without charge, or has been made available on
the Borrower’s website www.stewart.com, and the delivery date therefore shall be deemed to be the first day on which such
information is available to the Administrative Agent and the Lenders on one of such website pages, provided further that the Borrower
will promptly notify the Administrative Agent and the Lenders of each posting to such sites upon the occurrence thereof;”


 


(c)Section 5.02 of
the Credit Agreement is hereby amended by amending and restating subsection (c) to read as follows:


 






     


     

    

 


“(c)the
occurrence of any ERISA Event that, alone or together with any other ERISA Events that have occurred, could reasonably be expected
to result in liability of any Obligor in an aggregate amount exceeding $5,000,000; and”


 


(d)Section 6.07 of
the Credit Agreement is hereby amended and restated in its entirety to read as follows:


 


“Restricted
Payments. None of the Obligors will declare or make, or agree to pay or make, any Restricted Payment, except (a) Restricted
Payments to an Obligor; (b) Restricted Payments by the Borrower to any Person other than an Obligor so long as (i) the aggregate
amount of such Restricted Payments during any calendar year does not exceed $35,000,000 and (ii) no Default or Event of Default
exists at the time such Restricted Payment is made or is created as a result of such Restricted Payment; (c) Restricted Payments
by the Borrower under its previously announced share repurchase program, provided that the aggregate amount of such Restricted
Payments shall not exceed $60,000,000 from and after the Effective Date; (d) on or prior to December 31, 2018, Restricted Payments
by the Borrower to repurchase its outstanding shares of common stock in an amount not to exceed $50,000,000 in the aggregate from
and after the First Amendment Effective Date; (e) Restricted Payments by the Borrower in respect of the exchange of Class B common
shares into common shares, including payment to the holders of Class B common shares in an amount not to exceed $12,000,000; and
(f) any Obligor may make Restricted Payments to Stewart Title Guaranty Company.”


 


(e)Section 6.12 of
the Credit Agreement is hereby amended and restated in its entirety to read as follows:


 


“Capital
Expenditures. The Borrower shall not permit consolidated Capital Expenditures to exceed $25,000,000 in the aggregate in any calendar
year; provided, any unused portion of such $25,000,000 allowance that is not used may be carried forward for one (1) year
and utilized the following year; provided further, that such carryover shall not be used unless and until the Borrower shall
have fully utilized the $25,000,000 allowance for said following year and, if unused in a second year, any such carryover shall
not be carried forward any further.”


 


(f)Exhibit H to Credit
Agreement is hereby amended and restated in its entirety to read as set forth on Annex I attached hereto.


 


2.Conditions
Precedent. This Amendment shall become effective on the date on which the following conditions are satisfied (the “First
Amendment Effective Date”):


 


(a)after giving effect
to this Amendment, no Default or Event of Default shall exist;


 






     


     

    

 


(b)the Administrative
Agent (or its counsel) shall have received counterparts of this Amendment, duly executed by the Borrower, each Guarantor and the
Lenders constituting at least the Required Lenders; and


 


(c)all fees and expenses
payable to the Administrative Agent (including the fees and expenses of counsel to the Administrative Agent) accrued to date and
billed shall have been paid in full to the extent invoiced prior to the date hereof, but without prejudice to the later payment
of accrued fees and expenses not so invoiced.


 


3.Ratification.
The Borrower and each of the Guarantors hereby ratify all of its Obligations under the Credit Agreement and each of the Loan Documents
to which it is a party, and agrees and acknowledges that the Credit Agreement and each of the Loan Documents to which it is a party
are and shall continue to be in full force and effect as amended and modified by this Amendment. Nothing in this Amendment extinguishes,
novates or releases any right, claim, lien, security interest or entitlement of the Lenders created by or contained in any of such
documents nor is the Borrower nor any Guarantor released from any covenant, warranty or obligation created by or contained herein
or therein.


 


4.Representations
and Warranties. The Borrower and each Guarantor hereby represent and warrant to the Lenders that (a) this Amendment has been
duly executed and delivered on behalf of the Borrower and each of the Guarantors, (b) this Amendment constitutes a valid and legally
binding agreement enforceable against the Borrower and each of the Guarantors in accordance with its terms, subject to applicable
bankruptcy, insolvency, fraudulent transfer, 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, (c) after giving
effect to this Amendment, the representations and warranties made by it in the Credit Agreement and the Loan Documents to which
it is a party are true and correct on and as of the date hereof in all material respects as though made as of the date hereof except
to the extent that such representations and warranties expressly relate to an earlier date in which case they are true and correct
as of such earlier date, (d) after giving effect to this Amendment, no Default or Event of Default exists under the Credit Agreement
or under any Loan Document, (e) the Persons appearing as Guarantors on the signature pages to this Amendment constitute all Persons
who are required to be Guarantors pursuant to the terms of the Credit Agreement and the other Loan Documents, and (f) the execution,
delivery and performance of this Amendment has been duly authorized by the Borrower and each of the Guarantors.


 


5.Release and
Indemnity.


 


(a)The Borrower and
each Guarantor hereby release and forever discharge the Administrative Agent, each of the Lenders and each affiliate thereof and
each of their respective employees, officers, directors, trustees, agents, attorneys, successors, assigns or other representatives
from any and all claims, demands, damages, actions, cross-actions, causes of action, costs and expenses (including legal expenses),
of any kind or nature whatsoever, whether based on law or equity, which any of said parties has held or may now own or hold, whether
known or unknown, for or because of any matter or thing done, omitted or suffered to be done on or before the actual date upon
which this Amendment is signed by any of such parties arising directly or indirectly out of the Loan Documents, or any other documents,
instruments or any other transactions relating thereto. Such release, waiver, acquittal and discharge shall and does include, without
limitation, any claims of usury, fraud, duress, misrepresentation, lender liability, control, exercise of remedies and all similar
items and claims, which may, or could be, asserted by the Borrower or any Guarantor including any such caused by the actions or
negligence of the indemnified party (other than its gross negligence or willful misconduct).


 






     


     

    

  


(b)The Borrower and
each Guarantor hereby ratify the indemnification provisions contained in the Loan Documents, including, without limitation, Article
VIII and Section 10.03(b) of the Credit Agreement, and agree that the Guarantee is in full force and effect after the
execution and delivery of this Amendment, and that all losses, claims, damages and expenses related thereto shall be covered by
such indemnities.


 


6.Counterparts.
This Amendment may be signed in any number of counterparts, which may be delivered in original, facsimile or electronic form each
of which shall be construed as an original, but all of which together shall constitute one and the same instrument.


 


7.Governing
Law. This Amendment shall be construed in accordance with and governed by the Law of the State of New York, without regard
to such state’s conflict of laws rules.


 


8.Final Agreement
of the Parties. THIS AMENDMENT, THE CREDIT AGREEMENT AND THE LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES
AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN
ORAL AGREEMENTS AMONG THE PARTIES.


 


 


[Signature pages follow] 


 




     


     

    

 


IN WITNESS WHEREOF,
the parties hereto have caused this Amendment to be executed by their respective officers thereunto duly authorized as of the date
first above written.


 


	 	ADMINISTRATIVE AGENT, ISSUING BANK, SWINGLINE LENDER AND LENDER:
	 	 	 
	 	COMPASS BANK, N.A.
	 	 	 
	 	 	 
	 	By:	/s/ Jason Consoli
	 	Name:	Jason Consoli
	 	Title	Senior Vice President


 




     


     

    

 


	 	LENDER:
	 	 	 
	 	ZB, N.A. DBA AMEGY BANK
	 	 	 
	 	 	 
	 	By:	/s/ Jeremy A. Newsom
	 	Name:	Jeremy A. Newsom
	 	Title	Executive Vice President


 




     


     

    

 


	 	LENDER:
	 	 	 
	 	IBERIABANK
	 	 	 
	 	 	 
	 	By:	/s/ Steven C. Krueger
	 	Name:  	Steven C. Krueger
	 	Title	SVP


  




     


     

    

  


	 	LENDER:
	 	 	 
	 	TEXAS CAPITAL BANK, N.A.
	 	 	 
	 	 	 
	 	By:	/s/ Kurt A. Goeringer
	 	Name:	Kurt A. Goeringer
	 	Title	Senior Vice President


 




     


     

    

  


	 	BORROWER:
	 	 	 
	 	STEWART INFORMATION SERVICES CORPORATION, a Delaware corporation
	 	 	 
	 	 	 
	 	By:	/s/ J. Allen Berryman
	 	 	J. Allen Berryman
	 	 	Chief Financial Officer


 




     


     

    

  


	 	GUARANTORS:
	 	 	 
	 	STEWART TITLE COMPANY,
	 	a Texas corporation
	 	 	 
	 	 	 
	 	By:	/s/ J. Allen Berryman
	 	 	J. Allen Berryman
	 	 	Chief Financial Officer


  


 


	 	STEWART LENDER SERVICES, INC.,
	 	a Texas corporation
	 	 	 
	 	 	 
	 	By:	/s/ J. Allen Berryman
	 	 	J. Allen Berryman
	 	 	Vice President


 


 




     


     

    

 


Annex I


 


FORM OF COMPLIANCE
CERTIFICATE


 


The undersigned hereby
certifies that [s]he is a Financial Officer of Stewart Information Services Corporation, a Delaware corporation (the “Borrower”)
and that as such [s]he is authorized to execute this certificate on behalf of the Borrower. With reference to the Credit Agreement
dated October 21, 2014 (together with all amendments or supplements thereto being the “Credit Agreement”),
among the Borrower, the Guarantors party thereto and Compass Bank, the undersigned represents and warrants as follows (each capitalized
term used herein having the same meaning given to it in the Credit Agreement unless otherwise specified):


 


		(a)	The representations and warranties of the Borrower and its Subsidiaries contained in Article
III of the Credit Agreement and in the other Loan Documents were true and correct in all material respects when made, and are
repeated at and as of the time of delivery hereof and to the best of the undersigned’s knowledge are true and correct in
all material respects at and as of the time of delivery, except for such representations and warranties as are by their express
terms limited to a specific date.



 


		(b)	Since the later of the last date of the Credit Agreement or the most recent Compliance Certificate,
no change has occurred either in any case or in the aggregate, in the business, financial condition or results of operations, of
the Borrower or any of its Subsidiaries which would have a Material Adverse Effect.



 


		(c)	The Borrower hereby certifies that no Default has occurred or is continuing or, if a Default has
occurred, the details thereof and any action taken or proposed to be taken with respect thereto are specified on Exhibit A
attached hereto.



 


		(d)	There have been no changes in GAAP or the application thereof since the date of the last audited
financial statements delivered pursuant to Section [______] of the Credit Agreement, or if any change has occurred, the
effect such change would have on the financial statements accompanying this certificate is set forth on Exhibit A attached
hereto.



 


		(e)	Calculations for all financial covenants are set forth in the worksheet attached hereto as Exhibit
B.



 




     


     

    

 


EXECUTED AND DELIVERED
this _____ day of _____________________, 20__.


  


 


	 	BORROWER:
	 	 	 
	 	STEWART INFORMATION SERVICES CORPORATION
	 	 
	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 


  




     


     

    

 


EXHIBIT A


 


DEFAULTS; CHANGES
IN GAAP


 


 




     


     

    

 


EXHIBIT B


 


FINANCIAL COVENANT CALCULATION WORKSHEET


 


($ in 000’s)


 


	 	
        Pro
        Forma Calculation

         
	
        Covenant
        Requirement

         

	Fixed Charge Coverage Ratio	x	> 1.25 to 1.0
	Leverage Ratio	x	< 2.25 to 1.0
	Capital Expenditures	x	See Note 1 below.
	 	 	 
	Fixed Charge Coverage Ratio: calculated as of the fiscal quarter ended _______________, 201_	 	 
	(i)EBITDA for the four quarter period then ended	 	 
	to	 	 
	(ii)the sum of:	 	 
	(a) scheduled principal payments required to be made on Indebtedness of the Borrower and its Subsidiaries for the four quarter period then ended plus	 	 
	(b) cash Interest Expense for the four quarter period then ended plus	 	 
	(c) cash income tax expense for the four quarter period then ended plus	 	 
	(d) Restricted Payments paid by the Borrower as permitted by Section 6.07(b) for the four quarter period then ended.	 	 


 


 




     


     

    

  


	 	 	 
	Leverage Ratio: calculated as of the fiscal quarter ended _____________, 201__	 	 
	(i)total Indebtedness (exclusive of Indebtedness under Investment Securities Lines, contingent liabilities related to escrow and 1031 exchange accounts, letters of credit that are fully collateralized and contingent obligations of the Borrower or any of its Subsidiaries as an account party in respect of letters of credit and letters of guaranty)	 	 
	to	 	 
	(ii)EBITDA for the four quarter period ended on such date	 	 
	 	 	 
	Capital Expenditures: for the calendar year ended December 31, 20___	 	 
	(i) the difference of:	 	 
	(a) expenditures of the Borrower and its Subsidiaries in respect of fixed or capital assets, including the capital portion of the lease payments made in respect of Capital Lease Obligations, in each case which are required to be capitalized on a balance sheet prepared in accordance with GAAP minus	 	 
	(b) any such expenditures for the repair or replacement of any fixed or capital assets which were destroyed or damaged, in whole or in part, to the extent financed by the proceeds of an insurance policy.	 	 


 


 


 


Notes:


 


1. [Include for Compliance
Certificates delivered with annual financial statements only.] Capital Expenditure Limitation: < (a) $20,000,000
for the calendar year ending December 31, 2014, (b) $20,000,000 for the calendar year ending December 31, 2015 and (c)
$25,000,000, for the calendar year ending December 31, 2016 and each calendar year thereafter, plus any unused amounts from
the immediately preceding calendar year after utilizing the allowance for such calendar year.