EX-10.1



 






	 	 	 	 	 



EXHIBIT 10.1




SIXTH AMENDMENT TO

FOURTH AMENDED AND RESTATED LOAN AGREEMENT





     THIS SIXTH AMENDMENT TO FOURTH AMENDED AND RESTATED LOAN AGREEMENT (this “Amendment”)
is executed and entered into as of December 4, 2007, by and among ASTA FUNDING ACQUISITION I, LLC,
a Delaware limited liability company, ASTA FUNDING ACQUISITION II, LLC, a Delaware limited
liability company, PALISADES COLLECTION, L.L.C., a Delaware limited liability company, PALISADES
ACQUISITION I, LLC, a Delaware limited liability company, PALISADES ACQUISITION II, LLC, a Delaware
limited liability company, PALISADES ACQUISITION IV, LLC, a Delaware limited liability company,
PALISADES ACQUISITION V, LLC, a Delaware limited liability company, PALISADES ACQUISITION VI, LLC,
a Delaware limited liability company, PALISADES ACQUISITION VII, LLC, a Delaware limited liability
company, PALISADES ACQUISITION VIII, LLC, a Delaware limited liability company, PALISADES
ACQUISITION IX, LLC, a Delaware limited liability company, PALISADES ACQUISITION X, LLC, a Delaware
limited liability company, CLIFFS PORTFOLIO ACQUISITION I, LLC, a Delaware limited liability
company, SYLVAN ACQUISITION I, LLC, a Delaware limited liability company, and OPTION CARD, LLC, a
Colorado limited liability company (sometimes collectively referred to herein as
“Borrowers” and individually as a “Borrower”); ASTA FUNDING, INC., a Delaware
corporation, COMPUTER FINANCE, LLC, a Delaware limited liability company, ASTAFUNDING.COM, LLC, a
Delaware limited liability company, ASTA COMMERCIAL, LLC, a Delaware limited liability company, and
VATIV RECOVERY SOLUTIONS, LLC, a Texas limited liability company (collectively,
“Guarantors”); ISRAEL DISCOUNT BANK OF NEW YORK, a New York banking corporation
(“IDB”), as collateral agent for itself and the lenders signatory hereto from time to time
(together with any successor collateral agent appointed pursuant to Section 9.7, the
“Collateral Agent”), as administrative agent (together with any successor administrative
agent appointed pursuant to Section 9.7, the “Administrative Agent”, and together with the
Collateral Agent, the “Agents”), and as co-lead arranger; MIDDLE MARKET FINANCE, a division
of Merrill Lynch Business Financial Services Inc. (“Merrill Lynch”), as co-lead arranger
and as co-administrative agent; and the Lenders (as defined below).



RECITALS:




     A. Borrowers and Guarantor (collectively, the “Credit Parties”), along with
Administrative Agent and Lenders entered into a certain Fourth Amended and Restated Loan and
Security Agreement dated as of July 11, 2006 (as amended, modified, supplemented or restated from
time to time, the “Credit Agreement”). All capitalized terms used in this Amendment,
unless specifically defined herein, shall have the meanings attributed to them in the Credit
Agreement.



     B. The Credit Parties have requested that the Lenders temporarily increase the total Revolving
Loan Commitment from $175,000,000 to $185,000,000.



 









 





AGREEMENT:




     For good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Credit Parties, Administrative Agent and Lenders agree as follows:



SECTION 1. ACCURACY OF RECITALS.




     The Credit Parties acknowledge, represent, warrant and agree that the Recitals stated above
are true and complete in all respects.



SECTION 2. MODIFICATION.




     2.1 Increase in Revolving Loan Commitment.



     A. The Revolving Loan Commitment is hereby increased on a temporary basis by $10,000,000 (the
“Temporary Line Increase Amount”). As of the date of this Amendment, the total Revolving
Loan Commitment shall be in an aggregate amount of $185,000,000, which amount shall be reduced by
$10,000,000, to an aggregate amount of $175,000,000, on February 29, 2008. In the event the
Temporary Line Increase Amount is not fully reduced to zero by February 29, 2008, the Revolving
Loan Commitment shall nevertheless be reduced to $175,000,000 on February 29, 2008 and the then
outstanding portion of the Temporary Line Increase Amount shall be reduced over a six (6) month
period in substantially equal monthly amounts, with such reductions being made on the first day of
each month and applied on a pro-rata basis based upon the Temporary Line Increase Amount of each
such Lender. Interest shall continue to accrue on the outstanding portion of the Temporary Line
Increase Amount until it has been reduced to zero. All references in the Credit Agreement to
“Revolving Loan Commitment” shall mean the Revolving Loan Commitment as increased by this
Amendment.


B. The definition of “Revolving Loan Commitment” as contained in Annex A attached to the Credit
Agreement is hereby amended by deleting the definition in its entirety and replacing it with the
following new definition:





     “Revolving Loan Commitment” means (a) as to any Lender, the aggregate
commitment of such Lender to make Advances as set forth on Annex J to the Agreement
or in the most recent Assignment Agreement executed by such Lender and (b) as to all
Lenders, the aggregate commitment of all Lenders to make Advances which aggregate commitment
shall not exceed the following amounts: (1) ONE HUNDRED AND EIGHTY-FIVE MILLION DOLLARS
($185,000,000) FROM DECEMBER 4, 2007 THROUGH FEBRUARY 29, 2008 AND (2) ONE HUNDRED
SEVENTY-FIVE MILLION DOLLARS ($175,000,000) FROM FEBRUARY 29, 2008 AND THEREAFTER.


C. Annex J attached to the Credit Agreement is hereby deleted in its entirety and replaced
with the Replacement Annex J attached to this Amendment as Exhibit A.



D. To further evidence the increase in the Revolving Loan Commitment, the Borrowers, as obligors,
shall execute and deliver to each of BMO Capital Markets Financing, Inc. and Israel Discount Bank
of New York an Amended and Restated Revolving Note dated the date of this


 









 






Amendment to evidence the adjusted Revolving Loan Commitment of such Revolving Lender. The Amended
and Restated Revolving Note shall be in the principal amount of the adjusted Revolving Loan
Commitment of each of BMO Capital Markets Financing, Inc. and Israel Discount Bank of New York and
shall be substantially in the form of the original Revolving Notes.




     2.2 Use of Proceeds. Section 1.1(a) of the Loan Agreement is of the Credit Agreement is
amended by the addition of new subsection (vi) to read in its entirety as follows:




     (vi) Notwithstanding anything contained in this Section 1.1(a) or otherwise in this
Agreement to the contrary, use of Advances to finance any Portfolio purchase from Palisades
Acquisition XVI, LLC shall require the consent of all Lenders.



     2.3 No Other Modifications. Except as otherwise specifically modified by this Amendment, all
terms, conditions, covenants, rights, duties, obligations and liabilities of the Credit Parties
under the Credit Agreement remain in full force and effect and unmodified.



SECTION 3. REPRESENTATIONS AND WARRANTIES.




     The execution and delivery of this Amendment and the documents and instruments contemplated by
this Amendment have been duly authorized by all requisite action by or on behalf of the members of
the Credit Parties.



SECTION 4. FEES.




     The Borrowers shall pay to Administrative Agent, for the account of the Lenders, the fees
described in the fee letter of even date herewith.



SECTION 5. COVENANTS.




     5.1 This Amendment shall be governed by the terms and provisions of the Credit Agreement.



     5.2 In the event of a conflict between the terms of this Amendment and the terms of the Credit
Agreement, the terms of this Amendment shall govern and control.



     5.3 The Credit Parties hereby confirm and agree that the terms, conditions, covenants,
guaranties, assurances, promises and provisions contained in the Loan Documents to which each is a
party remain in full force and effect without amendment or modification as a result of this
Amendment and that the obligations, liabilities and duties of the Credit Parties remain unimpaired
as a result of this Amendment and are in full force and effect.



     5.4 In order for this Amendment to become effective, the following conditions must be
satisfied and the following items must be received by Administrative Agent in form and substance
satisfactory to Administrative Agent on or prior to the date that the Credit Parties shall execute
and deliver this Amendment to Lenders:



 









 




A. Amended and Restated Revolving Notes. Duly executed originals of Amended and Restated
Revolving Notes payable to the order of BMO Capital Markets Financing, Inc. and Israel Discount
Bank of New York dated the date of the Amendment.



B. Other Documents. Such other information, confirmations, certificates, documents and
agreements respecting any Credit Party as Administrative Agent may, in its reasonable discretion,
request.



C. Amendment Fee. Administrative Agent, shall have received, on behalf of Lenders, an
executed copy of the fee letter and payment of the amendment fee described therein.




SECTION 6. BINDING EFFECT.




     The Credit Agreement as modified herein shall be binding upon and shall inure to the benefit
of the members of the Credit Parties and their successors and assigns.



SECTION 7. COUNTERPART EXECUTION; FACSIMILES.




     This Amendment may be executed in one or more counterparts, each of which shall be deemed an
original and all of which together shall constitute one and the same document. Signature pages may
be detached from the counterparts and attached to a single copy of this Amendment to physically
form one document. Signatures may be exchanged by facsimile, with the original signature to
follow. Each party to this Amendment agrees to be bound by its own faxed signature and to accept
the faxed signature of the other parties to this Amendment.



[SIGNATURES PAGES TO FOLLOW]





 









 







IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the date first above
written.




	 	 	 	 	 	 	 
	BORROWERS:	 	ASTA FUNDING ACQUISITION I, LLC	 	 
	 	 	ASTA FUNDING ACQUISITION II, LLC	 	 
	 	 	PALISADES COLLECTION, L.L.C.	 	 
	 	 	CLIFFS PORTFOLIO ACQUISITION I, LLC	 	 
	 	 	PALISADES ACQUISITION I, LLC	 	 
	 	 	PALISADES ACQUISITION II, LLC	 	 
	 	 	PALISADES ACQUISITION IV, LLC	 	 
	 	 	PALISADES ACQUISITION V, LLC	 	 
	 	 	PALISADES ACQUISITION VI, LLC	 	 
	 	 	PALISADES ACQUISITION VII, LLC	 	 
	 	 	PALISADES ACQUISITION VIII, LLC	 	 
	 	 	PALISADES ACQUISITION IX, LLC	 	 
	 	 	PALISADES ACQUISITION X, LLC	 	 
	 	 	SYLVAN ACQUISITION I, LLC	 	 
	 	 	OPTION CARD, LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Mitchell Cohen
 

	 	 
	 	 	Name: Mitchell Cohen	 	 
	 	 	Title: Manager	 	 
	 
	 	 	 	 	 	 
	GUARANTORS:	 	ASTA FUNDING, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Mitchell Cohen
 

	 	 
	 	 	Name: Mitchell Cohen	 	 
	 	 	Title: Chief Financial Officer	 	 
	 
	 	 	 	 	 	 
	 	 	COMPUTER FINANCE, LLC	 	 
	 	 	ASTAFUNDING.COM, LLC	 	 
	 	 	ASTA COMMERCIAL, LLC	 	 
	 	 	VATIV RECOVERY SOLUTIONS, LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	s/ Mitchell Cohen
 

	 	 
	 	 	Name: Mitchell Cohen	 	 
	 	 	Title: Manager	 	 






Sixth Amendment to Fourth Amended and Restated Loan Agreement




 









 








	 	 	 	 	 	 	 
	AGENT:	 	ISRAEL DISCOUNT BANK OF NEW YORK,	 	 
	 	 	as Administrative Agent, Collateral Agent and	 	 
	 	 	Co-Lead Arranger	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Robert J. Fainelli
 

	 	 
	 	 	Name: Robert J. Fainelli	 	 
	 	 	Title: First Vice President	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ James Jordan
 

	 	 
	 	 	Name: James Jordan	 	 
	 	 	Title: First Vice President	 	 






Sixth Amendment to Fourth Amended and Restated Loan Agreement





 












 





	 	 	 	 	 	 	 
	 	 	MIDDLE MARKET FINANCE, a division of	 	 
	 	 	MERRILL LYNCH BUSINESS FINANCIAL	 	 
	 	 	SERVICES INC., as Co-Administrative Agent and	 	 
	 	 	Co-Lead Arranger	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Leonard Maddox
 

	 	 
	 	 	Name: Leonard Maddox	 	 
	 	 	Title: Vice President	 	 






Sixth Amendment to Fourth Amended and Restated Loan Agreement




 









 





	 	 	 	 	 	 	 
	LENDERS:	 	ISRAEL DISCOUNT BANK OF NEW YORK,	 	 
	 	 	as Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Robert J. Fainelli
 

	 	 
	 	 	Name: Robert J. Fainelli	 	 
	 	 	Title: First Vice President	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ James Jordan
 

	 	 
	 	 	Name: James Jordan	 	 
	 	 	Title: First Vice President	 	 






Sixth Amendment to Fourth Amended and Restated Loan Agreement




 









 





	 	 	 	 	 	 	 
	 	 	MIDDLE MARKET FINANCE, a division of	 	 
	 	 	MERRILL LYNCH BUSINESS FINANCIAL	 	 
	 	 	SERVICES INC., as Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Leonard Maddox
 

	 	 
	 	 	Print Name: Leonard Maddox	 	 
	 	 	Print Title: Vice President	 	 






Sixth Amendment to Fourth Amended and Restated Loan Agreement









 









 











	 	 	 	 	 	 	 
	 	 	BMO CAPITAL MARKETS FINANCING, INC.,

as Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Robert G. Bomben
 

	 	 
	 	 	Print Name: Robert G. Bomben	 	 
	 	 	Print Title: Director	 	 






Sixth Amendment to Fourth Amended and Restated Loan Agreement









 









 











	 	 	 	 	 	 	 
	 	 	BANK LEUMI USA, as Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Mary Ellen Bianco
 

	 	 
	 	 	Print Name: Mary Ellen Bianco	 	 
	 	 	Print Title: Vice President	 	 






Sixth Amendment to Fourth Amended and Restated Loan Agreement









 









 











	 	 	 	 	 	 	 
	 	 	THE BERKSHIRE BANK, as Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Ira A. Mermelstein
 

	 	 
	 	 	Print Name: Ira A. Mermelstein	 	 
	 	 	Print Title: Vice President	 	 






Sixth Amendment to Fourth Amended and Restated Loan Agreement









 









 











	 	 	 	 	 	 	 
	 	 	SIGNATURE BANK, as Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Thomas J. D’Antona
 

	 	 
	 	 	Print Name: Thomas J. D’Antona	 	 
	 	 	Print Title: Senior Vice President	 	 






Sixth Amendment to Fourth Amended and Restated Loan Agreement




 









 





	 	 	 	 	 	 	 
	 	 	PROVIDENT BANK, as Lender	 	 
	 
	 

	 	By:
	 	/s/ Ronald Romco
 

	 	 
	 	 	Print Name: Ronald Romco	 	 
	 	 	Print Title: Vice President	 	 






Sixth Amendment to Fourth Amended and Restated Loan Agreement





 









 








EXHIBIT A

TO SIXTH AMENDMENT TO

FOURTH AMENDED AND RESTATED LOAN AGREEMENT




REPLACEMENT ANNEX J 




(from Annex A – Commitments definition)

to

FOURTH AMENDED AND RESTATED LOAN AGREEMENT




	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Temporary	 	Adjusted
	 	 	Revolving Loan	 	Line Increase	 	Revolving Loan
	Lender	 	Commitment	 	Amount	 	Commitment
	Israel Discount Bank of New York
	 	$	45,000,000	 	 	$	5,000,000	 	 	$	50,000,000	 
	Middle Market Finance, a
division of Merrill Lynch
Business Financial Services
Inc.
	 	$	30,000,000	 	 	 	 	 	 	$	30,000,000	 
	Bank Leumi USA
	 	$	20,000,000	 	 	 	 	 	 	$	20,000,000	 
	BMO Capital Markets Financing,
Inc.
	 	$	35,000,000	 	 	$	5,000,000	 	 	$	40,000,000	 
	The Berkshire Bank
	 	$	10,000,000	 	 	 	 	 	 	$	10,000,000	 
	Signature Bank
	 	$	20,000,000	 	 	 	 	 	 	$	20,000,000	 
	Provident Bank
	 	$	15,000,000	 	 	 	 	 	 	$	15,000,000	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Total
	 	$	175,000,000	 	 	$	10,000,000	 	 	$	185,000,000