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Case Status:    SETTLED
On or around 04/17/2003 (Date of order of final judgment)

Filing Date: October 29, 1999

According to the docket, on January 27, 2003, a Stipulation and Agreement of Settlement was filed, and on January 31, 2003, the Court entered the Order preliminarily approving the stipulation and the settlement. A hearing was set for April 14, 2003. At the hearing, the Court approved the $5.6 million proposed settlement as fair, reasonable and adequate. The Court approved fees and costs in the amount of $1,866.666.60 plus $122,891.97 in costs, and the Final order was signed.

As summarized by the Company’s FORM 10-K For The Fiscal Year Ended December 31, 2002, in November 1999, the Company received notice that it had been named in a lawsuit filed in the United States District Court for the Eastern District of New York, seeking certification as a class action and alleging violations of the federal securities laws in connection with the Company’s initial public offering in 1996 and its reports subsequently filed with the Securities and Exchange Commission. The complaint alleges that the scope of the violations alleged in the consumer lawsuits and regulatory actions brought in or around 1999 indicate a pervasive pattern of action and risk that should have been more thoroughly disclosed to investors in the Company’s common stock. In May 2000, the Court consolidated this case and several other lawsuits that purportedly contain the same or similar allegations against the Company and in August 2000 plaintiffs filed their Consolidated Amended Complaint. In October 2000, the Company filed a motion to dismiss the Complaint in its entirety, which was opposed by plaintiffs in November 2000, and denied by the Court in September 2001. The Company reached an agreement in principal with plaintiffs' counsel and its insurer to settle the action on a class-wide basis in or about August 2002 and executed a settlement agreement in January 2003 (pursuant to which the Company denied all wrongdoing). The settlement has been preliminarily approved by the Court and a fairness hearing has been scheduled for April 2003.

The original complaint charges each of the defendants, including the principal underwriters of Delta’s IPO, Natwest Securities Limited, Prudential Securities Incorporated, and U.S. Bancorp Piper Jaffray, Inc., with violations of Sections 11 and 15 of the Securities Act of 1933 . Additionally, the complaint charges Delta Financial and certain of its officers and directors with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. In particular, the complaint alleges that the Registration Statement and Prospectus issued in connection with the Company's IPO contained false and misleading statements concerning the Company's questionable and improper sales practices, allowing the Company to raise over $75,000,000 in proceeds from the IPO.

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