The latest agreement increased the cash balances the company could keep without having to deposit the funds into a cash collateral account to $8 million from May 1 through May 2, $6 million from May 8 through 14 and $5 million on May 15. Jackson Hewitt will be able to withdraw money from the cash collateral account through the restructuring date in order to fund operations under a budget that the lenders had previously accepted. The company and lenders holding a majority of loans and commitments must agree to a monthly expenditure budget from May 1 through January 31, 2012.
Jackson Hewitt Lenders to Leave Shareholders Little
Lenders this week gave Jackson Hewitt Tax Service until May 20 to make a principal payment and to executive documents with them about a proposed restructuring. The latest SEC filing by the tax preparation chain said that options continue to include a "pre-package bankruptcy." The new agreement extended the previous deadline from April 30. The latest filing indicated shareholders will have little left.
In terms of what common stock shareholders could hope for, the SEC filing was definite. "While the terms of any restructuring remain to be finalized, the terms of the restructuring currently under discussion with the lenders do not contemplate that any value will be available for shareholders," it said.
