What does the statement mean?
From here
ref and out parameters in C# and cannot be marked as variant.
1) Does it mean
It means you can't have the following declaration:
public delegate R MyDelegate(ref A arg);
Edit: @Eric Lippert corrected me that this one is still legal:
public delegate void MyDelegate(A arg, out R s);
It actually makes sense, since the R generic parameter is not marked as a variant, so it doesn't violate the rule. However, this one is still illegal:
public delegate void MyDelegate(A arg, out R s);