EXHIBIT 10.5
THIS SEVENTH AMENDMENT TO CREDIT AGREEMENT, dated as of February 13,
2003, is among:
KINGSWAY FINANCIAL SERVICES INC.
AND KINGSWAY U.S. FINANCE PARTNERSHIP
As Borrowers
AND
The Lenders named herein as Lenders
AND
LASALLE BANK NATIONAL ASSOCIATION,
As Administrative Agent and Co-Syndications Agent
AND
CANADIAN IMPERIAL BANK OF COMMERCE,
As Co-Syndications Agent and Documentation Agent
WHEREAS:
1. Pursuant to a Credit Agreement made as of the 23rd day of February,
1999 among the parties hereto, as subsequently amended (the "Credit Agreement"),
the Lenders and the Agents established certain credit facilities in favour of
the Borrowers;
2. The Agents, the Lenders and the Borrowers have agreed to amend certain
terms and conditions of the Credit Agreement, in the manner hereinafter set
forth;
FOR VALUABLE CONSIDERATION, the parties agree as follows:
ARTICLE I
AMENDMENT TO COVENANTS
1.01 Amendment to Capital Surplus Ratio Covenant. Sub-section 8.02(2) of the
Credit Agreement is hereby deleted in its entirety and replaced with the
following:
"Capital Surplus Ratio. Kingsway shall maintain at all times a Capital
Surplus Ratio on a Consolidated basis calculated quarterly on the last day
of each fiscal quarter of Kingsway on a rolling four-quarter basis as
follows:
1
(i) from the Closing Date to and including June 30, 2002 of not greater
than 2.75:1.00;
(ii) from July 1, 2002 to and including December 31, 2002 of not greater
than 3.50:1.00;
(iii) from January 1, 2003 to and including June 30, 2003 of not greater
than 3.25:1.00; and
(iv) thereafter of not greater than 3.00:1.00."
ARTICLE II
CONDITIONS PRECEDENT TO THIS AGREEMENT
2.01 Conditions Precedent. The amendments set forth in this Seventh Credit
Amending Agreement shall not become effective until the execution and delivery
of this Seventh Credit Amending Agreement by the Borrowers and the Majority of
the Lenders.
ARTICLE III
MISCELLANEOUS
3.01 Nature of Amendments and Defined Terms. It is acknowledged and agreed that
the terms of this Seventh Credit Amending Agreement are in addition to and,
unless specifically provided for, shall not limit, restrict, modify, amend or
release any of the understandings, agreements or covenants as set out in the
Credit Agreement. The Credit Agreement shall henceforth be read and construed in
conjunction with this Seventh Credit Amending Agreement and the Credit Agreement
together with all of the powers, provisions, conditions, covenants and
agreements contained or implied in the Credit Agreement shall be and shall
continue to be in full force and effect. References to the "Credit Agreement" or
the "Agreement" in the Credit Agreement or in any other document delivered in
connection with, or pursuant to, the Credit Agreement, shall mean the Credit
Agreement, as amended hereby. Capitalized terms utilized in this Agreement but
not defined in herein shall have the meanings ascribed to such terms in the
Credit Agreement.
3.02 Assignment. This Seventh Credit Amending Agreement shall enure to the
benefit of and be binding upon the parties hereto and their respective
successors and assigns but shall not be assignable by the Borrowers or either of
them without the prior written consent of the Agents and Lenders.
3.03 Severability. Any provision of this Seventh Credit Amending Agreement which
is prohibited or unenforceable in any jurisdiction shall not invalidate the
remaining provisions
hereof and any such prohibition or unenforceability in any jurisdiction shall
not invalidate or render unenforceable such provision in any other jurisdiction.
3.04 Governing Law. This Seventh Credit Amending Agreement shall be governed by
and construed in accordance with the laws of the Province of Ontario and the
laws of Canada applicable therein and shall be treated in all respects as an
Ontario contract and the parties hereby submit and attorn to the non-exclusive
jurisdiction of the courts of the Province of Ontario.
3.05 Further Assurances. The Borrowers shall from time to time and at all times
hereafter, upon every reasonable request from the Agents or the Lenders, make,
do, execute and deliver or cause to be made, done, executed and delivered, all
such further acts, deeds and assurances and things as may be necessary in the
opinion of the Agents for more effectually implementing and carrying out the
true intent and meaning of this Seventh Credit Amending Agreement.
3.06 Counterparts. This Seventh Credit Amending Agreement may be executed in any
number of counterparts, each of which shall constitute an original and all of
which, taken together, shall constitute one and the same agreement.
IN WITNESS WHEREOF the parties hereto have executed this Seventh Amendment
to Credit Agreement.
KINGSWAY FINANCIAL SERVICES INC.
By: /s/ Xxxxxxx X. Star
------------------------------------
Xxxxxxx X. Star
President & Chief Executive Officer
By: /s/ W. Xxxxx Xxxxxxx
------------------------------------
W. Xxxxx Xxxxxxx
Executive Vice President & Chief
Financial Officer
KINGSWAY U.S. FINANCE PARTNERSHIP
by its Partners
KINGSWAY FINANCIAL SERVICES INC.
By: /s/ W. Xxxxx Xxxxxxx
------------------------------------
Name: W. Xxxxx Xxxxxxx
Title: Secretary
METRO CLAIM SERVICES INC.
By: /s/ W. Xxxxx Xxxxxxx
------------------------------------
Name: W. Xxxxx Xxxxxxx
Title: Treasurer
CANADIAN IMPERIAL BANK OF COMMERCE
By: /s/ Xxxxx Xxxxxx
------------------------------------
Name: Xxxxx Xxxxxx
Title: Executive Director
By: /s/ Xxxxx Xxxxxx Xxxxxxx
------------------------------------
Name: Xxxxx Xxxxxx Xxxxxxx
Title: Managing Director
LASALLE BANK NATIONAL ASSOCIATION
By: /s/ Xxxx Xxxxxxxx
------------------------------------
Xxxx Xxxxxxxx
Assistant Vice President
LASALLE BANK NATIONAL ASSOCIATION,
AS ADMINISTRATIVE AGENT
By: /s/ Xxxx Xxxxxxxx
------------------------------------
Xxxx Xxxxxxxx
Assistant Vice President
CANADIAN IMPERIAL BANK OF COMMERCE,
AS DOCUMENTATION AGENT
By: /s/ Xxxxx Xxxxxx
------------------------------------
Name: Xxxxx Xxxxxx
Title: Executive Director
By: /s/ Xxxxx Xxxxxx Xxxxxxx
------------------------------------
Name: Xxxxx Xxxxxx Xxxxxxx
Title: Managing Director
CANADIAN IMPERIAL BANK OF COMMERCE
NEW YORK AGENCY
By: /s/ Xxxxxxxxx Xxxx
------------------------------------
Name: Xxxxxxxxx Xxxx
Title: Executive Director
CIBC World Markets Corp.
As Agent
THE BANK OF NOVA SCOTIA
By: /s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Managing Director
WACHOVIA BANK, NATIONAL ASSOCIATION
By: /s/ Xxxxxxxx Xxxxxxx
------------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Director