EXHIBIT 10.6
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FIFTH AMENDMENT
TO
FOURTH AMENDED AND RESTATED CREDIT AGREEMENT
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Fifth Amendment dated as of June 5, 2002 to the Fourth Amended and
Restated Credit Agreement (the "Amendment"), by and among HPSC, INC., a Delaware
corporation (the "Borrower"), AMERICAN COMMERCIAL FINANCE COMPANY, a Delaware
corporation (the "Guarantor" or "ACFC"), FLEET NATIONAL BANK and the other
lending institutions listed on SCHEDULE 1 to the Credit Agreement (as
hereinafter defined) (the "Banks"), and Fleet National Bank as agent for the
Banks (in such capacity, the "Agent"), amending certain provisions of the Fifth
Amended and Restated Credit Agreement dated as of May 12, 2000 (as amended and
in effect from time to time, the "Credit Agreement") by and among the Borrower,
the Guarantor, the Banks and the Agent. Terms not otherwise defined herein which
are defined in the Credit Agreement shall have the same respective meanings
herein as therein.
WHEREAS, the Borrower and the Banks have agreed to modify certain terms
and conditions of the Credit Agreement, as specifically set forth in this
Amendment;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements contained herein and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
SECTION 1. AMENDMENTS TO THE CREDIT AGREEMENT.
(a) Section 1.1 of the Credit Agreement is hereby amended by amending
and restating in its entirety the definition of "Revolving Credit Loan Maturity
Date":
REVOLVING CREDIT LOAN MATURITY DATE. The first to occur of (x) August
5, 2002 or (y) termination, as determined by the Agent in its sole and absolute
discretion, of the Borrower's proposed financing arrangements with Foothill
Capital Corporation and others described in the Foothill Proposal Letter.
(b) Section 1.1 of the Credit Agreement is hereby amended by amending
clause (x) of the proviso of the definition of "Borrowing Base" as follows:
"(x) the net amount attributable to ACFC Receivables included in the
Borrowing Base shall not comprise more than 50% of the Borrowing Base
and shall not exceed $20,000,000 and".
(c) Section 4.3 of the Credit Agreement is hereby deleted in its
entirety and replaced with the following new Section 4.3:
4.3 REPAYMENTS OF THE TERM LOAN. The Borrower promises to pay to the
Agent for the account of the Banks the principal amount of the Term
Loan in four (4) installments, the first three of which shall each
equal as nearly as possible to 1/4th of the principal amount of the
Term Loan outstanding on the Revolving Credit Loan Maturity Date, such
installments to be due and payable on August 5, 2002, November 5, 2002
and February 5, 2003, with a final payment on the Term Loan Maturity
Date in an amount equal to the unpaid balance of the Term Loan.
(d) The date "May 5, 2002" in Section 5.1.1 is hereby deleted and
replaced with "August 5, 2002".
(e) Section 9 of the Credit Agreement is hereby amended by inserting
the following new Section 9.18:
9.18. DISCLOSURES CONCERNING ACFC DEFALCATION INVESTIGATION. Upon the
first to occur of: (i) completion by Pricewaterhouse Coopers of its
investigation of the ACFC defalcation disclosed to Agent and the Banks
on or before June 1, 2002 (the "ACFC Defalcation") and its internal
investigation of the Borrower related thereto (the "Related Audit") or
(ii) June 24, 2002, the Borrower shall furnish to the Agent such
information in connection with the ACFC Defalcation and the Related
Audit as the Agent shall reasonably request to enable the Agent and the
Banks to determine whether a material adverse change has occurred with
respect to the Borrower and its subsidiaries by reason of the ACFC
Defalcation.
(f) The first sentence of the provision at the end of Section 11 is
hereby amended to read in its entirety as follows:
For purposes of determining compliance with Section 11.1 for the fiscal
quarter ending June 30, 2002, the Newco Transaction Costs shall be
excluded from such calculation.
(g) Section 13 of the Credit Agreement is hereby amended by inserting
the following new section 13.6 at the end thereof:
13.6. RENEWAL OF LIQUIDITY FACILITY. Not later than June 24, 2002, the
Bravo Credit Agreement shall have been renewed for a term not less
than one (1) year.
SECTION 2. CONDITIONS TO EFFECTIVENESS. This Amendment shall not become
effective until the Agent receives (a) a counterpart of this Amendment, executed
by the Borrower, the Guarantor and all of the Banks, (b) payment by the Borrower
of the fees referred to in Section 3 and (d) such other documents as the Agent
may request.
SECTION 3. FEES. On the date of the closing of this Fifth Amendment,
the Borrower will pay to the Agent to for the account of each Bank the amendment
fee in the amount set forth below:
Fleet National Bank $117,889.23
Key Bank National Association $ 62,312.85
PNC Bank, National Association $ 33,682.64
Banknorth, N.A. $ 33,682.64
Citizens Bank of Massachusetts $ 33,682.64
TOTAL $281,250.00
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SECTION 4. REPRESENTATIONS AND WARRANTIES. The Borrower hereby repeats,
on and as of the date hereof, each of the representations and warranties made by
it in SECTION 8 of the Credit Agreement, and such representations and warranties
remain true as of the date hereof (except to the extent of changes resulting
from transactions contemplated or permitted by the Credit Agreement and the
other Loan Documents, and to the extent that such representations and warranties
relate expressly to an earlier date), PROVIDED, that all references therein to
the Credit Agreement shall refer to such Credit Agreement as amended hereby. In
addition, the Borrower hereby represents and warrants that the execution and
delivery by the Borrower of this Amendment and the performance by the Borrower
of all of its agreements and obligations under the Credit Agreement as amended
hereby are within the corporate authority of the Borrower and has been duly
authorized by all necessary corporate action on the part of the Borrower.
SECTION 5. WAIVER AND RELEASE. The Borrower (and by its execution of
the Ratification by Guarantor hereto, the Guarantor) hereby represent, warrant
and agree that neither of them has any claims, defenses, counterclaims or
offsets against the Agent or any Bank in connection with the Credit Agreement or
the Obligations and, to the extent that any such claim, defense, counterclaim or
offset may exist, the Borrower and the Guarantor hereby affirmatively WAIVE AND
RELEASE the Agent and the Banks from the same.
SECTION 6. RATIFICATION, ETC. Except as expressly amended hereby, the
Credit Agreement, the Security Documents and all documents, instruments and
agreements related there to are hereby ratified and confirmed in all respects
and shall continue in full force and effect. The Credit Agreement and this
Amendment shall be read and construed as a single agreement. All references in
the Credit Agreement or any related agreement or instrument to the Credit
Agreement or any related agreement or instrument to the Credit Agreement shall
hereafter refer to the Credit Agreement as amended hereby.
SECTION 7. NO WAIVER. Nothing contained herein shall constitute a
waiver of, impair or otherwise affect any Obligations, any other obligation of
the Borrower or any rights of the Agent or the Bank. Without limiting the
foregoing, the Agent and the Banks hereby expressly reserve any and all rights
and remedies against the Borrower and the Guarantor arising out of, or in
connection with, the ACFC Defalcation.
SECTION 8. COUNTERPARTS. This Amendment may be executed in one or more
counterparts, each of which shall be deemed an original but which together shall
constitute one and the same instrument.
SECTION 9. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS
(WITHOUT REFERENCE TO CONFLICT OF LAWS).
**NEXT PAGE IS SIGNATURE PAGE**
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IN WITNESS WHEREOF, the undersigned have duly executed this Amendment
as a sealed instrument as of the date first set forth above.
HPSC, INC.
By: /S/ JOHN W. EVERETS
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Name: John W. Everets
Title: Chairman and Chief Executive
Officer
FLEET NATIONAL BANK, individually and as Agent
By: /S/ C. CHRISTOPHER SMITH
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Name: C. Christopher Smith
Title: Vice President
KEYBANK NATIONAL ASSOCIATION
By: /S/ MITCHELL B. FELDMAN
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Name: Mitchell B. Feldman
Title: Senior Vice President
PNC BANK, NATIONAL ASSOCIATION
(SUCCESSOR TO NATIONAL BANK OF CANADA)
By: /S/ EDWARD CHONKO
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Name: Edward Chonko
Title: AVP
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BANKNORTH, N.A.
(F/K/A FIRST MASSACHUSETTS BANK, N.A.)
By: /S/ JOHN R. SUNDSTROM
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Name: John R. Sundstrom
Title: Senior Vice President
CITIZENS BANK OF MASSACHUSETTS
By: /S/ DAVID FARWELL
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Name: David Farwell
Title: Vice President
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RATIFICATION BY GUARANTOR
The undersigned Guarantor hereby acknowledges and consents to the
foregoing Amendment as of June 5, 2002 and agrees that the Guaranty dated as of
June 23, 1994 from the undersigned in favor of the Agent and each of the Banks,
as amended by Omnibus Amendment No. 4 to Security Documents, dated as of May 12,
2000, and each of the other Security Documents to which it is a party remain in
full force and effect, and the Guarantor confirms and ratifies all of its
obligations thereunder.
AMERICAN COMMERCIAL
FINANCE CORPORATION
By: /S/ JOHN W. EVERETS
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Name: John W. Everets
Title: Executive Vice President
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