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But was granted a reprieve from Citibank, et. al. See the following excerpt from the 8K this morning.
Item 1.01 Entry into a Material Definitive Agreement.
On
January 17, 2008, Ambac Financial Group, Inc. (“Ambac”) and Ambac
Assurance Corporation (collectively, the “Borrowers”), certain lenders
and Citibank, N.A., as administrative agent (the “Administrative
Agent”), entered into an amendment (the “Amendment No. 1”) to the First
Amended and Restated Revolving Credit Agreement, dated as of July 30,
2007 (as amended, supplemented and otherwise modified from time to time
and in effect on the date hereof, the “Credit Agreement”)
among the Borrowers, the Administrative Agent, The Bank of New York and
KeyBank, National Association, as co-syndication agents, HSBC Bank USA,
N.A. and Wachovia Bank, National Association as co-documentation agents
and Citigroup Global Markets Inc. as the sole lead arranger and sole
book runner, and certain other financial institutions, as lenders.
The
Amendment No.1 amends Section 5.03(a) concerning minimum net assets and
the definition of “Total Capital” set forth in Section 1.01 of the
Credit Agreement by excluding net mark-to-market (losses) gains on
credit derivative contracts with the exception of the Impairment Value
with respect to such losses. In addition, the Amendment No.1 adds a
definition of “Impairment Value” to Section 1.01.
________________________
Excerpt from the earnings call transcript:
"Now
how about answered quality? Many of you have expressed concern over
this issue. Some feel that our 1.1 billion reserves, which is
incorporated in our quarterly results was a surprise and contrary to
assurances expressed by the company in the past. David Wallace is going
to cover this issue in detail when I am finished. He will provide you
with the same analysis that he provided our board and financial
advisers.
I do not want to run on here only to force listeners to
hear it all again but the short answer is this. We analyzed our
potential losses using several methods. Until this quarter, the
methodologies in which we had the most confidence showed no losses,
this quarter although one methodology in which we had previously relied
continued to show no losses. An additional methodology, which is tied
to the specific legal structure and radiance on the underlying
securities, began to feel losses as the rating agencies accelerated
downgrades of the underlying securities. Naturally, we took these
results in to account setting our reserve."
 
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