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Jackson Hewitt amends loan, changing covenants, structure and pricing
By Sara Rosenberg
New York, May 3 - Jackson Hewitt Tax Service Inc. amended its credit facility, revising covenants, structure and the interest rate, according to an 8-K filed with the Securities and Exchange Commission on Monday.
Under the amendment, the leverage ratio and the interest coverage ratio have been waived and replaced by a maximum net expenditure covenant based on the company's off-season operating plan, as well as a minimum EBITDA requirement.
Also, the $175 million revolver was modified so that $105 million will continue to be a revolver and $70 million will no longer be available for re-borrowing.
The company made its scheduled $25 million principal repayment on its $225 million term loan on April 30 and subsequently made an additional $65 million payment to reduce the $139 million outstanding balance on the revolver to $74 million, of which $70 million was then reclassified into the non-revolver commitment.
Pricing on the facility was increased by 650 basis points PIK to Libor plus 1,100 bps, of which 450 bps is cash.
Lastly, the amendment waived the requirement that audited financial statements are not qualified as to status as a going concern for the fiscal year ended April 30.
The amendment was completed on April 30.
Wells Fargo is the administrative agent on the deal.
Jackson Hewitt is a Parsippany, N.J.-based provider of full-service individual federal and state income tax return preparation.
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