Document:

exhibit 10-1

THIRD AMENDMENT AND MODIFICATION
TO LOAN AND SECURITY AGREEMENT

THIS THIRD AMENDMENT AND MODIFICATION TO LOAN AND SECURITY AGREEMENT (the “Amendment”) is executed on the 29th day of February, 2012, by and among HOOPER HOLMES, INC., a New York corporation (“Borrower”), HOOPER INFORMATION SERVICES, INC., a New Jersey corporation (“Information”), MID-AMERICA AGENCY SERVICES, INCORPORATED, a Nebraska corporation (“Mid America”), TEG ENTERPRISES, INC., a Nebraska corporation (“TEG”), HERITAGE LABS INTERNATIONAL , LLC, a Kansas limited liability company (“Heritage”), HOOPER DISTRIBUTION SERVICES, LLC, a New Jersey limited liability company (“Distribution” and together with Information, Mid America, TEG and Heritage, the “Guarantors” and each a “Guarantor”) and TD BANK, N.A., in its capacity as agent (the “Agent”) and in its capacity as a Lender (as defined below).
BACKGROUND
A.Pursuant to that certain Loan and Security Agreement dated March 9, 2009 by and among Borrower, Guarantors, Agent and the lenders described therein (collectively, the “Lenders” and each a “Lender”) (as amended by that certain First Amendment and Modification to Loan and Security Agreement dated December 1, 2010, that certain Second Amendment and Modification to Loan and Security Agreement dated February 25, 2011 and as the same may hereafter be further amended, modified, supplemented or restated from time to time, being referred to herein as the “Loan Agreement”), Lenders agreed, inter alia, to extend to Borrower a line of credit in the maximum principal amount of Fifteen Million Dollars ($15,000,000.00).

B.Borrower has requested and Agent has agreed to amend the Loan Agreement in accordance with the terms and conditions contained herein.

C.All capitalized terms contained herein and not otherwise defined herein shall have the meanings set forth in the Loan Agreement.

NOW, THEREFORE, intending to be legally bound hereby, the parties hereto agree as follows:
1.Fixed Charge Coverage Ratio.  Section 8.1 of the Loan Agreement is amended to read, in its entirety, as follows:

“8.1 Fixed Charge Coverage Ratio.  Obligors shall maintain a Fixed Charge Coverage Ratio measured on a rolling twelve (12) month basis of not less than 1.1 to 1.0 as of (i) January 31, 2010 and as of the end of each fiscal quarter of Obligors ending thereafter through and including the fiscal quarter ending September 30, 2011 and (ii) any fiscal quarter of Obligors ending after September 30, 2011 if, for any one or more day(s) following any such fiscal quarter end (a) the outstanding balance of cash advances under the Line is greater than $0 and (b) the amount of Obligors' cash on deposit with Agent is less than $6,000,000. Notwithstanding the foregoing, each compliance certificate delivered under Section 9.8 shall include a calculation of Obligors' Fixed Charge Coverage Ratio as of each fiscal quarter end, regardless of whether such covenant is to be tested pursuant to this Section 8.1.”

2.Projections.  Section 9.1 of the Loan Agreement is amended to read, in its entirety, as follows:

“9.2    Projections and Cash Flow.  As soon as available and in any event within (x) thirty (30) days prior to the end of each fiscal year of Obligors, prior to the fiscal year ended December 31, 2011 and (y) forty-five (45) days after the end of each fiscal year of Obligors, commencing with the fiscal year ended December 31, 2011, projections and cash flows on a month by month basis for the next succeeding twelve (12) months, prepared by the chief financial officer of such Borrower.  Obligors have previously furnished initial projections to Agent containing the information required by this Section 9.2 (the “Initial Projections”).  Obligors represent and covenant that (a) the Initial Projections have been and all projections required by this Section 9.2 shall be prepared by the chief financial officer of each Borrower and represent, and in the future shall represent, the best available good faith estimate of Obligors regarding the course of each Obligor's business for the annual periods covered thereby; (b) the assumptions set forth in the Initial Projections are and the assumptions set forth in the future projections delivered hereafter shall be reasonable and realistic based on then current economic conditions; (c) Obligors know of no reason why Obligors should not be able to achieve the annual performance levels set forth in the Initial Projections and Obligors shall have no knowledge at the time of delivery of future projections of any reason why Obligors shall not be able to meet the performance levels set forth in said projections; and (d) Obligors have sufficient capital as may be required for their ongoing business and to pay their existing and anticipated debts as they mature.”
3.Amendment Fee.  In addition to all other sums due under the Loan Agreement and the other Loan Documents, Obligors shall pay to Agent on the date hereof an amendment fee in an amount equal to $10,000.00, which fee may be charged to the Line or debited from any account of Obligors maintained with Agent.

4.Amendment/References.  The Loan Agreement and the Loan Documents are hereby amended to be consistent with the terms of this Amendment.  All references in the Loan Agreement and the Loan Documents to (a) the “Loan Agreement” shall mean the Loan Agreement as amended hereby; and (b) the “Loan Documents” shall include this Amendment and all other instruments or agreements executed pursuant to or in connection with the terms hereof.

5.Release.  Borrower and each Guarantor acknowledges and agrees that it has no claims, suits or causes of action against Agent or any Lender and hereby remises, releases and forever discharges Agent and each Lender, their officers, directors, shareholders, employees, agents, successors and assigns, and any of them, from any claims, suits or causes of action whatsoever, in law or at equity, which Borrower or any Guarantor has or may have arising from any act, omission or otherwise, at any time up to and including the date of this Amendment.

6.Additional Documents; Further Assurances.  Borrower covenants and agrees to execute and deliver to Agent, or to cause to be executed and delivered to Agent contemporaneously herewith, at the sole cost and expense of Borrower, the Amendment and any and all documents, agreements, statements, resolutions, searches, insurance policies, consents, certificates, legal opinions and information as Agent may require in connection with the execution and delivery of this Amendment or any documents in connection herewith, or to further evidence, effect, enforce or protect any of the terms hereof or the rights or remedies granted or intended to be granted to Agent or any Lender herein or in any of the Loan Documents, or to enforce or to protect Agent's and each Lender's interest in the Collateral.  All such documents, agreements, statements, etc., shall be in form and content acceptable to Agent in its sole discretion.  Borrower hereby authorizes Agent to file, at Borrower's cost and expense, financing statements, amendments thereto and other items as Agent may require to evidence or perfect Agent's and each Lender's continuing security interest and liens in and against the Collateral.  Borrower agrees to join with Agent in notifying any third party with possession of any Collateral of Agent's and each Lender's security interest therein and in obtaining an acknowledgment from the third party that it is holding the Collateral for the benefit of Agent and Lenders.  Borrower will cooperate with Agent in obtaining control with respect to Collateral consisting of deposit accounts, investment property, letter-of-credit rights and electronic chattel paper.

7.Further Agreements and Representations.  Borrower does hereby:

(a)ratify, confirm and acknowledge that the statements contained in the foregoing Background are true and complete and that, as amended hereby, the Loan Agreement and the other Loan Documents are in full force and effect and are valid, binding and enforceable against Borrower and its assets and properties, all in accordance with the terms thereof, as amended;

(b)covenant and agree to perform all of Borrower's obligations under the Loan Agreement and the other Loan Documents, as amended;

(c)acknowledge and agree that as of the date hereof, Borrower has no defense, set-off, counterclaim or challenge against the payment of any Lender Indebtedness or the enforcement of any of the terms of the Loan Agreement or of the other Loan Documents, as amended;

(d)acknowledge and agree that all representations and warranties of Borrower contained in the Loan Agreement and/or the other Loan Documents, as amended, are true, accurate and correct on and as of the date hereof as if made on and as of the date hereof;

(e)represent and warrant that, after giving effect to this Amendment, no Default or Event of Default exists;

(f)covenant and agree that Borrower's failure to comply with any of the terms of this Amendment or any other instrument or agreement executed or delivered in connection herewith, shall constitute an Event of Default under the Loan Agreement and each of the other Loan Documents; and

(g)acknowledge and agree that nothing contained herein, and no actions taken pursuant to the terms hereof, are intended to constitute a novation of any of the Note, the Loan Agreement or of any of the other Loan Documents and does not constitute a release, termination or waiver of any existing Event of Default or of any of the liens, security interests, rights or remedies granted to the Agent or any other Lender in any of the Loan Documents, which liens, security interests, rights and remedies are hereby expressly ratified, confirmed, extended and continued as security for all Lender Indebtedness.

Borrower acknowledges and agrees that Agent and Lenders are relying on the foregoing agreements, confirmations, representations and warranties of Borrower and the other agreements, representations and warranties of Borrower contained herein in agreeing to the amendments contained in this Amendment.
8.Fees, Cost, Expenses and Expenditures.  Borrower will pay all of Agent's and each Lender's expenses in connection with the review, preparation, negotiation, documentation and closing of this Amendment and the consummation of the transactions contemplated hereunder, including without limitation, fees, disbursements, expenses and disbursements of counsel retained by Agent and each Lender and all fees related to filings, recording of documents, searches, environmental assessments and appraisal reports, whether or not the transactions contemplated hereunder are consummated.

9.No Waiver.  Nothing contained herein constitutes an agreement or obligation by Agent or any Lender to grant any further amendments to the Loan Agreement or any of the other Loan Documents.  Nothing contained herein constitutes a waiver or release by Agent or any Lender of any Event of Default or of any rights or remedies available to Agent or any Lender under the Loan Documents or at law or in equity.
 
10.Inconsistencies. To the extent of any inconsistencies between the terms and conditions of this Amendment and the terms and conditions of the Loan Agreement or the other Loan Documents, the terms and conditions of this Amendment shall prevail.  All terms and conditions of the Loan Agreement and other Loan Documents not inconsistent herewith shall remain in full force and effect and are hereby ratified and confirmed by Borrower.

11.Binding Effect.  This Amendment, upon due execution hereof, shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.

12.Governing Law.  This Amendment shall be governed and construed in accordance with the laws of the State of New Jersey without regard to conflict of law principles.

13.Severability.  The provisions of this Amendment and all other Loan Documents are deemed to be severable, and the invalidity or unenforceability of any provision shall not affect or impair the remaining provisions which shall continue in full force and effect.

14.Modifications.  No modification of this Amendment or any of the Loan Documents shall be binding or enforceable unless in writing and signed by or on behalf of the party against whom enforcement is sought.

15.Headings.  The headings of the Articles, Sections, paragraphs and clauses of this Amendment are inserted for convenience only and shall not be deemed to constitute a part of this Amendment.

16.Counterparts.  This Amendment may be executed in multiple counterparts, each of which shall constitute an original and all of which together shall constitute the same agreement.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

IN WITNESS WHEREOF, the parties hereto, intending to be legally bound hereby, have caused this Amendment to be executed the day and year first above written.
HOOPER HOLMES, INC., a New York corporation 

By:    /s/ Michael J. Shea                                         
Name/Title:  Michael J. Shea/SVP & CFO                

HOOPER INFORMATION SERVICES, INC., a New Jersey corporation

By:    /s/ Michael J. Shea                                         
Name/Title:  Michael J. Shea/CFO                             

MID-AMERICA AGENCY SERVICES, INCORPORATED, a Nebraska corporation

By:    /s/ Michael J. Shea                                         
Name/Title:  Michael J. Shea/CFO                             

TEG ENTERPRISES, INC., a Nebraska corporation

By:    /s/ Michael J. Shea                                         
Name/Title:  Michael J. Shea/CFO                             

HERITAGE LABS INTERNATIONAL , LLC, a Kansas limited liability company

By:    /s/ Michael J. Shea                                         
Name/Title:  Michael J. Shea/CFO                             

HOOPER DISTRIBUTION SERVICES, LLC, a New Jersey limited liability company

By:    /s/ Michael J. Shea                                         
Name/Title: Michael J. Shea/CFO                             

TD BANK, N.A., as Agent and Lender

By:    /s/ Stephen A. Caffrey                                      
Name/Title:   Stephen A. Caffrey                                  

Each of the undersigned, intending to be legally bound hereby, consents and agrees to the foregoing Third Amendment and Modification to Loan and Security Agreement dated of even date herewith (the “Agreement”), and all terms thereof and further agrees that such Agreement shall in no way affect or impair the undersigned's obligations under that certain Surety Agreement from the undersigned to Agent dated March 9, 2009 (the “Surety”), or under any other documents executed or delivered pursuant thereto or in connection therewith and  the terms of the Surety is hereby ratified and confirmed, all as of the date hereof.
HOOPER INFORMATION SERVICES, INC., a New Jersey corporation

By:    /s/ Michael J. Shea                                         
Name/Title:  Michael J. Shea/CFO                             

MID-AMERICA AGENCY SERVICES, INCORPORATED, a Nebraska corporation

By:    /s/ Michael J. Shea                                         
Name/Title:  Michael J. Shea/CFO                             

TEG ENTERPRISES, INC., a Nebraska corporation

By:    /s/ Michael J. Shea                                         
Name/Title:  Michael J. Shea/CFO                             

HERITAGE LABS INTERNATIONAL , LLC, a Kansas limited liability company

By:    /s/ Michael J. Shea                                         
Name/Title:  Michael J. Shea/CFO                             

HOOPER DISTRIBUTION SERVICES, LLC, a New Jersey limited liability company

By:    /s/ Michael J. Shea                                         
Name/Title:  Michael J. Shea/CFOawcex101.htm

EXHIBIT 10.1

AMENDMENT TO REVOLVING LINE OF CREDIT NOTE AND CREDIT AGREEMENT

THIS AMENDMENT TO REVOLVING LINE OF CREDIT NOTE AND CREDIT AGREEMENT (this “Amendment”) is made as of the 3rd day of January, 2012, by and between AMERICAN WOODMARK CORPORATION, a Virginia corporation (“Borrower”), and WELLS FARGO BANK, NATIONAL ASSOCIATION (the “Bank”).

RECITALS

A.           Bank extended credit to Borrower (the “Loan”) as evidenced by that certain Revolving Line of Credit Note dated as of December 2, 2009 made by Borrower payable to the order of Bank in the original principal amount of Thirty-Five Million and No/100 Dollars ($35,000,000.00) (as modified, amended, renewed, restated or replaced from time to time, the “Note”).

B.           Bank and Borrower entered into that certain Credit Agreement dated as of December 2, 2009 (as modified or amended from time to time, the “Credit Agreement”), setting forth the terms and conditions of the Loan.

C.           The Loan is secured by, among other collateral, those certain Security Agreements dated as of December 2, 2009 given by Borrower in favor of Bank (collectively, as modified or amended from time to time, the “Security Agreements”), granting a security interest to Bank in certain personal property of Borrower as more particularly described therein.

D.           Borrower has requested, and Bank has agreed, to extend the maturity date of the Note and modify certain other terms and conditions of the Credit Agreement.

E.           Bank and Borrower mutually desire to modify and amend the provisions of the Note and Credit Agreement in the manner hereinafter set out, it being specifically understood that, except as herein modified and amended, the terms and provisions of the Note and Credit Agreement shall remain unchanged and continue in full force and effect as therein written.

AGREEMENT

NOW, THEREFORE, effective as of the date first written above, Bank and Borrower, in consideration of Bank’s continued extension of credit and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by each of the foregoing, hereby agree that the Note and Credit Agreement shall be, and the same hereby are, modified and amended as follows:

1.           The Note is hereby modified and amended by deleting and restating the last sentence of subsection (a) of the section of the Note entitled “BORROWING AND REPAYMENT”, entitled “Borrowing and Repayment”, in its entirety as follows: “The outstanding principal balance of this Note shall be due and payable in full on December 31, 2015.”

2.           The Credit Agreement is hereby modified and amended by deleting the text “Maintain a ratio of Total Liabilities to Tangible Net Worth of not greater than 0.9 to 1.0 measured at the end of each fiscal quarter of Borrower” where it appears in subsection (a) of Section 4.9 of the Credit Agreement, entitled “FINANCIAL CONDITION”, and replacing such text with the following: “Maintain a ratio of Total Liabilities to Tangible Net Worth of not greater than 1.5 to 1.0 measured at the end of each fiscal quarter of Borrower.”

  

  

  

IT IS MUTUALLY AGREED by and between the parties hereto that this Amendment shall become a part of the Note and Credit Agreement by reference and that nothing herein contained shall impair the security now held for said indebtedness, nor shall waive, annul, vary or affect any provision, condition, covenant or agreement contained in the Note and/or Credit Agreement, except as herein amended, nor affect or impair any rights, powers or remedies under the Note and/or Credit Agreement, each as hereby amended.

Borrower promises and agrees to pay and perform all of the requirements, conditions and obligations under the terms of the Note and Credit Agreement, each as hereby modified and amended, said documents being hereby ratified and affirmed.  The execution and delivery hereof shall not constitute a novation or modification of the lien, encumbrance or security title of any of the instruments securing the Note, including, without limitation, the Security Agreements, which instruments shall continue to retain their priority as originally filed for record.  Borrower expressly agrees that the Note and Credit Agreement are in full force and effect and that Borrower has no right to setoff, counterclaim or defense to the payment thereof.  Any reference contained in the Note or Credit Agreement, as amended herein, or any of the other documents evidencing, securing or otherwise executed in connection with the Loan to the Note or Credit Agreement shall hereinafter be deemed to be a reference to such document as amended hereby.

This Amendment shall be closed without cost to Bank and all expenses incurred in connection with this closing (including, without limitation, all attorneys’ fees) are to be paid by Borrower.  Bank is not providing legal advice or services to Borrower.

This Amendment shall be governed by and construed in accordance with the laws of the Commonwealth of Virginia without regard to principles of conflict of laws.

This Amendment shall be binding upon and inure to the benefit of any assignee or the respective heirs, executors, administrators, successors and assigns of the parties hereto.

This Amendment shall be attached to the Note as an allonge and shall become a part thereof as fully as if set forth therein.

This Amendment may be executed in any number of counterparts, each of which shall be an original but all of which taken together shall constitute one and the same instrument, and any of the parties hereto may execute any of such counterparts.

[SIGNATURE PAGE FOLLOWS]

  

  

  

AMENDMENT TO REVOLVING LINE OF CREDIT NOTE AND CREDIT AGREEMENT

 

 

[SIGNATURE PAGE]

IN WITNESS WHEREOF, this instrument has been executed under seal by the parties hereto and delivered on the date and year first above written.

BORROWER:

AMERICAN WOODMARK CORPORATION,

a Virginia corporation

	
By:

	
/s/ Glenn Eanes

	
(SEAL)

	
Name:

	
Glenn Eanes

	  
	
Title:

	
Vice President and Treasurer

	  

BANK:

WELLS FARGO BANK, NATIONAL ASSOCIATION

	
By:

	
/s/ Chad J. Harcum

	
(SEAL)

	
Name:

	
Chad J. Harcum

	  
	
Title:

	
Senior Vice President

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