EXHIBIT 10.5
THIRD AMENDMENT TO FIFTH AMENDED
AND RESTATED LOAN AGREEMENT
This Third Amendment to Fifth Amended and Restated Loan Agreement,
dated as of June 26, 2003, by and among The J. Xxxx Group, Inc., a Delaware
corporation ("BORROWER") on the one hand, and Citizens Bank of Massachusetts,
HSBC Bank USA, and Banknorth, N.A. (collectively, "LENDERS") and Citizens Bank
of Massachusetts as agent ("AGENT") for the LENDERS, on the other hand.
WITNESSETH:
WHEREAS, BORROWER, LENDERS and AGENT are parties to that certain Fifth
Amended and Restated Loan Agreement dated as of June 29, 2001, as amended by
First Amendment thereto dated as of August 28, 2001, and by Second Amendment
thereto dated as of July 25, 2002 (collectively, the "LOAN AGREEMENT"); and
WHEREAS, BORROWER, LENDERS and AGENT wish to amend the LOAN AGREEMENT
as more particularly hereafter set forth. Capitalized terms used herein without
definition shall have the meanings ascribed to them in the LOAN AGREEMENT.
NOW, THEREFORE, in consideration of the covenants and agreements herein
contained, the parties hereby agree that the LOAN AGREEMENT is hereby amended as
follows:
1. Section 1.01 of the LOAN AGREEMENT is hereby amended by deleting
the definition of "AGGREGATE COMMITMENT AMOUNT" appearing therein
and substituting therefor the following:
"AGGREGATE COMMITMENT AMOUNT shall mean the sum of SIXTY MILLION
DOLLARS ($60,000,000)."
2. Section 1.01 of the LOAN AGREEMENT is hereby amended by adding a
new definition to said Section as follows:
"SEC" shall mean the United States Securities and Exchange
Commission, an agency of the United States government.
3. Section 1.01 of the LOAN AGREEMENT is hereby amended by deleting
the definition of "TERMINATION DATE" appearing therein and
substituting therefor the following:
"TERMINATION DATE shall mean June 1, 2005."
4. Section 2.01 of the LOAN AGREEMENT is hereby deleted in its
entirety and the following is substituted therefor:
"2.01 Subject to, and upon the terms and conditions herein
provided, during the AVAILABILITY PERIOD, each LENDER severally to
the extent of its COMMITMENT and COMMITMENT PERCENTAGE, agrees to
make ADVANCES to the BORROWER, so long as (a) after giving effect
to BORROWER'S request for each such ADVANCE, the REVOLVING LOAN
BALANCE does not exceed Twenty Million Dollars ($20,000,000); (b)
the CREDIT BALANCE does not exceed the AGGREGATE COMMITMENT AMOUNT;
and (c) at the time of such ADVANCE the conditions specified in
Section 2.15 have been and remain fulfilled."
5. Section 5.01 of the LOAN AGREEMENT is hereby amended by deleting
said Section in its entirety and substituting therefor the
following:
"5.01 The respective amount of each LENDER'S COMMITMENT AMOUNT and
its respective COMMITMENT PERCENTAGE with respect to the LOANS
shall be:
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BANK COMMITMENT COMMITMENT
AMOUNT PERCENTAGE
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Citizens Bank of $27,000,000 45%
Massachusetts
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HSBC Bank USA $21,000,000 35%
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Banknorth, N.A. $12,000,000 20%"
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6. Subsection 8.01(a) of the LOAN AGREEMENT is hereby deleted in its
entirety and the following is substituted therefor:
"8.01(a) As soon as practicable and in any event not later than the
earlier of (i) ninety (90) days after the end of each fiscal year,
or (ii) the date on which consolidated statements are filed with
the SEC, consolidated statements, on an unqualified audit basis, of
income, retained earnings and cash flow of the BORROWER and its
SUBSIDIARIES for such year, and audited balance sheets of the
BORROWER and its SUBSIDIARIES as at the end of such year, setting
forth in each case in comparative form corresponding figures for
the preceding fiscal year from the preceding annual audit, all in
reasonable detail and reasonably satisfactory in scope to the
MAJORITY LENDERS and certified by the ACCOUNTANTS whose certificate
shall be on an unqualified, audited basis representing an
unqualified opinion, all in scope and substance satisfactory to the
MAJORITY LENDERS, and such financial statements shall be prepared
in accordance with GAAP."
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7. Subsection 8.01(b) of the LOAN AGREEMENT is hereby deleted in its
entirety and the following is substituted therefor:
"8.01(b) As soon as practicable and in any event not later than the
earlier of (i) forty-five (45) days after the end of each of the
first three quarterly periods in each FISCAL YEAR, or (ii) the date
on which consolidated statements are filed with the SEC,
consolidated statements of income and cash flow of the BORROWER and
its SUBSIDIARIES for the period from the beginning of the current
FISCAL YEAR to the end of such quarterly period, and a balance
sheet of the BORROWER and its SUBSIDIARIES as at the end of such
quarterly period, setting forth in each case, in comparative form,
figures for the corresponding period in the preceding FISCAL YEAR,
all in reasonable detail, and such financial statements shall be
prepared in accordance with GAAP subject to customary year end
adjustments and the absence of footnotes. Such quarterly statements
shall correspond to the information contained in BORROWER'S 10Q
financial statements as filed with the SEC."
8. Subsection 8.01(c) of the LOAN AGREEMENT is hereby amended by
deleting the words "and consolidating" appearing in the third line
of said subsection; and Subsection 8.01(d) of the LOAN AGREEMENT is
hereby amended by deleting said subsection in its entirety and
substituting therefor the following:
"8.01(d) Not later than January 31 of each FISCAL YEAR, annual
projections for such current FISCAL YEAR of BORROWER and its
SUBSIDIARIES, showing projected monthly balance sheets, income
statements, and cash flows for such year, all in such form as the
AGENT shall reasonably require."
Subsection 8.01(e) of the LOAN AGREEMENT is hereby amended by
deleting said subsection in its entirety and substituting therefor
the following:
"8.01(e) At the time of delivery of the reports required by Section
8.01(a) and 8.01 (b), a certificate of the Chief Financial Officer,
Vice President of Finance or Controller of the BORROWER, and within
five (5) business days of the time of delivery of the reports
required by Section 8.01(a), a certificate from the ACCOUNTANTS (i)
stating that, in his, her or their opinion, as the case may be, if
such be the case, there has been and is existing no DEFAULT or
EVENT OF DEFAULT hereunder, or if that not be the case, setting
forth the details of all such DEFAULT or EVENT OF DEFAULT, and (ii)
in such BORROWER'S officer's certificate showing appropriate
calculations indicating compliance (or non-compliance) with the
covenants set forth in Article IX."
9. Subsection 8.01(f) of the LOAN AGREEMENT is hereby amended by
deleting said subsection in its entirety and substituting therefor
the following:
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"8.01(f) If requested by any of the LENDERS, copies of all notices
to shareholders, all proxies, reports and any other publicly
available materials filed with the SEC and all press releases."
10. Section 9.04 of the LOAN AGREEMENT is hereby deleted in its
entirety and the following is substituted therefor:
"9.04 The BORROWER shall not, and shall not permit any SPECIAL
SUBSIDIARY to, merge or consolidate or be merged or consolidated
with or into any other corporation or entity (except that nothing
herein shall prevent any SPECIAL SUBSIDIARY from merging or
consolidating with any other SPECIAL SUBSIDIARY, or any SPECIAL
SUBSIDIARY(IES) merging or consolidating with the BORROWER) nor
shall BORROWER create any SUBSIDIARY which is not in existence on
the date of this AGREEMENT without obtaining the MAJORITY LENDERS'
prior written consent."
11. Section 9.17 of the LOAN AGREEMENT is hereby amended by deleting
said section in its entirety and substituting therefor the
following:
"9.17 BORROWER's TANGIBLE NET WORTH shall not be less than One
Hundred Nineteen Million Four Hundred Fifty Five Thousand Dollars
($119,455,000) from the date of execution hereof through December
26, 2003; and at December 27, 2003, BORROWER'S TANGIBLE NET WORTH
shall not be less than the sum of (A) One Hundred Nineteen Million
Four Hundred Fifty Five Thousand Dollars ($119,455,000) and (B)
fifty percent (50%) of BORROWER'S net income (but not less than
zero) for the year then ended (the "TNW MINIMUM BENCHMARK").
Thereafter, at each year end of BORROWER in each succeeding year,
BORROWER's TANGIBLE NET WORTH shall not be less than the sum of (A)
the TNW MINIMUM BENCHMARK for the immediately preceding year and
(B) fifty percent (50%) of BORROWER'S net income (but not less than
zero) for the year then ended."
12. Subsection 12.02(a) of the LOAN AGREEMENT is hereby amended by
deleting the subsection contained therein beginning with the words
"Xxxxx, Xxxx" and ending with the words "Attn: Xxxxx X. Xxxxxxx,
Esq." and substituting therefor the following:
"Xxxxx Xxxx LLP
000 Xxxxxxx Xxxxxxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
Attn: Xxxxx X. Xxxxxxx, Esq."
13. Subsection 12.02(b) of the LOAN AGREEMENT is hereby amended by
deleting the name "Xxxxxxxxxxx X.X. Xxxxxxxx, Vice President"
appearing therein and substituting therefor the name "Xxxxxx
Xxxxxxxx, Senior Vice President".
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14. Subsection 12.02(b) of the LOAN AGREEMENT is hereby further amended
by deleting the words "Bank of New Hampshire, N.A. c/o BankNorth
Group, Inc." appearing in said subsection and substituting therefor
the words "Banknorth, N.A."
15. Subsection 12.02(b) of the LOAN AGREEMENT is hereby further amended
by deleting the words ", Suite 700" appearing immediately after the
words "7 New England Executive Park" appearing in said subsection.
16. Subsection 12.02 (c) of the LOAN AGREEMENT is hereby amended by
deleting the subsection contained therein beginning with the words
"Xxxxxxxx Xxxxxxxx Xxxxxxxxx & Xxxxxxx" and ending with the name
"Xxxx X. Xxxxxxxx, Esq." and substituting therefor the following:
"Xxxxx Xxxxxxx & Xxxxxxx, P.C.
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
Attn: Xxxx X. Xxxxxxxx, Esq."
17. Simultaneously herewith, BORROWER shall pay to AGENT for the
benefit of the LENDERS on a pro rata basis a facility fee of
Seventy-Five Thousand Dollars ($75,000) in connection with this
Third Amendment to Fifth Amended and Restated Loan Agreement.
18. Simultaneously herewith, BORROWER shall execute and deliver
respectively to each of the LENDERS an amended and restated
REVOLVING NOTE in the face amount as set forth in Section 5.01, in
substitution for (and replacing and superseding) each REVOLVING
NOTE previously given to each such LENDER, each in form and
substance satisfactory to AGENT.
Except as hereby amended, the LOAN AGREEMENT is hereby ratified, confirmed and
republished.
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IN WITNESS WHEREOF, the parties hereto have set their hands and seals
as of the date first above written.
CITIZENS BANK OF MASSACHUSETTS THE J. XXXX GROUP, INC.
By: /s/ Xxxx X. Xxxxx By: /s/ Xxxxx X. Xxxxxx
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Xxxx X. Xxxxx, Senior Vice President Name: Xxxxx X. Xxxxxx
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Title: Vice President/Corporate Controller
HSBC BANK USA BANKNORTH, N.A.
By: /s/ Xxxxxx Xxxxxxxx By: /s/ Xxx X. Xxxxxxxxx
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Xxxxxx Xxxxxxxx, Senior Vice President Xxx X. Xxxxxxxxx
Senior Vice President
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