Document:

<PAGE>

                                                                    EXHIBIT 10.5

                           MICROFINANCIAL INCORPORATED

                          REGISTRATION RIGHTS AGREEMENT

         This Registration Rights Agreement (the "AGREEMENT") is made as of this
14th day of April, 2003 by and among MicroFinancial Incorporated (the
"COMPANY"), and each of the Lenders set forth on Schedule A attached hereto,
along with their successors and assigns (the "HOLDERS"). Capitalized terms used
herein and not otherwise defined shall have the meaning ascribed to them in the
Loan Agreement (as defined below).

W I T N E S S E T H:

         WHEREAS, the Leasecomm Corporation (the "BORROWER"), a wholly-owned
Subsidiary of Company, and the Holders are parties to that certain Fourth
Amended and Restated Revolving Credit Agreement dated as of August 22, 2000 by
and among Fleet National Bank, as agent (the "AGENT") for the lenders party
thereto (the "LENDERS) and the Borrower (as amended, modified or restated, the
"LOAN AGREEMENT");

         WHEREAS, in connection with the closing of the Second Amendment to the
Loan Agreement, the Company has issued to the Holders as of the date hereof
certain Warrants to purchase shares of Common Stock (the "WARRANTS");

         WHEREAS, the Company and the Holders wish to enter into a Registration
Rights Agreement as set forth herein;

         NOW THEREFORE, in consideration of the Holders agreement to the Second
Amendment to the Loan Agreement, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:

         1.       Incidental Registration.

                  1.1. If the Company at any time proposes to register any of
its equity securities under the Securities Act (other than a Registration (i)
relating to shares of Common Stock issuable upon exercise of employee stock
options or in connection with any employee benefit or similar plan of the
Company or (ii) in connection with an acquisition by the Company of another
company), whether as a result of a primary or secondary offering or pursuant to
registration rights granted to holders of other securities of the Company, the
Company shall, each such time, subject to the provisions of Section 1.2, give
prompt written notice to the Holders of its intention to do so and of such
Holders' rights under this Section 1, at least 20 days prior to the anticipated
filing date of the Registration Statement relating to such Registration. Such
notice shall offer all of the Holders the opportunity to include in such
Registration Statement such number of Registrable Securities as each such Holder
may request. Upon the written request of any such Holder made within 10 days
after the receipt of the Company's notice (which request shall

<PAGE>

specify the number of Registrable Securities intended to be disposed of by such
Holder), the Company shall use its best efforts to effect the Registration under
the Securities Act of all Registrable Securities which the Company has been so
requested to register by the Holders thereof; provided, that (x) if such
Registration involves an underwritten offering, all Holders requesting to be
included in the Company's Registration must sell their Registrable Securities to
the underwriters selected by the Company on the same terms and conditions as
apply to the Company; and (y) if, at any time after giving written notice of its
intention to register any securities pursuant to this Section 1.1 and prior to
the Effective Date of the Registration Statement filed in connection with such
Registration, the Company shall determine for any reason not to register such
securities, the Company shall give written notice to all Holders and shall
thereupon be relieved of its obligation to register any Registrable Securities
in connection with such Registration. If a Registration pursuant to this Section
1.1 involves an underwritten public offering, any Holder requesting to be
included in such Registration may elect, in writing prior to the effective date
of the Registration Statement filed in connection with such Registration, not to
register such Registrable Securities in connection with such Registration. The
Company shall pay all Registration Expenses in connection with each Registration
of Registrable Securities requested pursuant to this Section 1.

                  1.2. Priority in Incidental Registrations. If a Registration
pursuant to this Section 1 involves an underwritten offering and the managing
underwriter advises the Company that, in its good faith opinion, the number of
equity securities (including all Registrable Securities) which the Company, the
Holders and any other persons intend to include in such Registration exceeds the
largest number of securities which can be sold without having an adverse effect
on such offering, including the price at which such Registrable Securities can
be sold, the Company will include in such Registration (i) first, Registrable
Securities and all other securities proposed to be registered by the Holders
thereof, pro rata based on the number of Registrable Securities and other
securities proposed to be registered by each such Holder and (ii) second,
securities that the Company proposes to issue and sell for its own account.

         2.       Registration Procedures.

         In connection with any offering of Registrable Securities registered
pursuant to this Agreement, the Company shall:

                  2.1. Prepare and file with the Commission as soon as
practicable, and in any event within 120 days after receipt of a request for
Registration, a Registration Statement on any form for which the Company then
qualifies and which counsel for the Company shall deem appropriate, and which
form shall be available for the sale of the Registrable Securities in accordance
with the intended methods of distribution thereof, and use commercially
reasonable efforts to cause such Registration Statement to become and remain
Effective as provided herein, provided that at least fifteen (15) days prior to
filing with the Commission a Registration Statement or disclosure document
constituting part of a Registration Statement or any amendments or supplements
thereto, the Company will (x) furnish to one counsel selected by the Holders of
a majority of the Registrable Securities covered by such Registration Statement
copies of all such documents proposed to be filed for said counsel's review and
comment and (y)

                                      - 2 -

<PAGE>

notify each Holder covered by such Registration Statement of any stop order
issued or threatened by the Commission and take all reasonable actions required
to prevent the entry of such stop order or to remove it if entered.

                  2.2. Prepare and file with the Commission such amendments and
supplements to such Registration Statement and any disclosure document
constituting part of such Registration Statement used in connection therewith as
may be necessary to keep Effective such Registration Statement for a period of
not less than 180 days or such shorter period which will terminate when all
Registrable Securities covered by such Registration Statement have been sold
(but not before the expiration of the 90 day period, if applicable, referred to
in Section 4(3) of the Securities Act and Rule 174 under the Securities Act, or
any successor thereto, if applicable), and comply with the provisions of the
Securities Act with respect to the disposition of all securities covered by such
Registration Statement during such period in accordance with the intended
methods of disposition by the sellers thereof set forth in such Registration
Statement.

                  2.3. Furnish to each Holder and each underwriter, if any, of
Registrable Securities covered by such Registration Statement such number of
copies of such Registration Statement, each amendment and supplement thereto (in
each case including all exhibits thereto), and the disclosure document included
in such Registration Statement (including each preliminary disclosure document),
in conformity with the requirements of the Securities Act, and such other
documents as any Holder may reasonably request in order to facilitate the
disposition of the Registrable Securities owned by such Holder.

                  2.4. Use commercially reasonable efforts to register or
qualify such Registrable Securities under such other state securities or "blue
sky" laws of such jurisdictions as any Holder, and underwriter, if any, of
Registrable Securities covered by such Registration Statement reasonably
requests and do any and all other acts and things which may be reasonably
necessary or advisable to enable such Holder and each underwriter, if any, to
consummate the disposition in such jurisdictions of the Registrable Securities
owned by such Holder; provided that the Company will not be required to (x)
qualify generally to do business in any jurisdiction where it would not
otherwise be required to qualify but for this Section 2, (y) subject itself to
taxation in any such jurisdiction or (z) consent to general service of process
in any such jurisdiction.

                  2.5. Immediately notify each Holder of such Registrable
Securities at any time when a disclosure document relating thereto is required
to be delivered under the Securities Act of the happening of any event which
comes to the Company's attention if as a result of such event the disclosure
document included in such Registration Statement contains an untrue statement of
material fact or omits to state any material fact required to be stated therein
or necessary to make the statements therein not misleading, and promptly prepare
and furnish to such Holder a Supplement or amendment to such disclosure document
so that, as thereafter delivered to the Holders of such Registrable Securities,
such disclosure document will not contain an untrue statement of a material fact
or omit to state any material fact required to be stated therein or necessary to
make the statements therein not misleading.

                                      - 3 -

<PAGE>

                  2.6. Use commercially reasonable efforts to cause all such
Registrable Securities to be listed on a national securities exchange or the
NASDAQ national market and on each securities exchange upon which similar
securities issued by the Company may then be listed, and enter into such
customary agreements including a listing application and indemnification
agreement in customary form, and to provide a transfer agent and registrar for
such Registrable Securities covered by such Registration Statement no later than
the effective date of such Registration Statement.

                  2.7. Enter into such customary agreements (including an
underwriting agreement in customary form) and take all such other actions as the
Holders of a majority of the Registrable Securities being covered by such
Registration Statement or the underwriters retained by such Holders, if any,
reasonably request in order to expedite or facilitate the disposition of such
Registrable Securities, including customary representations, warranties,
indemnities and agreements.

                  2.8. Make available for inspection by any Holder covered by
such Registration Statement, any underwriter participating in any disposition
pursuant to such Registration Statement, and any attorney, accountant or other
agent retained by any such Holder or underwriter (collectively, the
"INSPECTORS"), all financial and other records, pertinent corporate documents
and properties of the Company (collectively, "RECORDS"), and cause the Company's
and its Affiliates' officers, directors and employees to supply all information
and respond to all inquiries reasonably requested by any such Inspector in
connection with such Registration Statement.

                  2.9. Use commercially reasonable efforts to obtain (a) a "cold
comfort" letter from the Company's independent public accountants in customary
form and covering such matters of the type customarily covered by "cold comfort"
letters as the Holders of a majority in interest of the Registrable Securities
being sold reasonably request and (b) at the time of any underwritten sale
pursuant to a Registration Statement, a "bring-down comfort letter", dated as of
the date of such sale, from the Company's independent certified public
accountants covering such matters of the type customarily covered by comfort
letters as the Holders of a majority in interest of the Registrable Securities
covered by such Registration Statement and the underwriters reasonably request.

                  2.10. Otherwise use commercially reasonable efforts to comply
with all applicable rules and regulations of the Commission, and make available
to the Holders, as soon as reasonably practicable, an earnings statement
covering a period of at least twelve months, beginning with the first month
after the Effective Date of the Registration Statement, which earnings statement
shall satisfy the provisions of the Securities Act and Rule 158 thereunder.

                  2.11. In the event of the issuance of any stop order
suspending the effectiveness of a Registration Statement, or of any order
suspending or preventing the use of any related prospectus or suspending the
qualification of any Registrable Securities included in such Registration
Statement for sale in any jurisdiction, the Company will use its best efforts
promptly to obtain the withdrawal of such order.

                                      - 4 -

<PAGE>

         It shall be a condition precedent to the obligation of the Company to
take any action with respect to securities of a Holder that such Holder shall
furnish to the Company such information regarding the securities held by such
Holder and the intended method of disposition thereof as the Company shall
reasonably request and as shall be required in connection with the action taken
by the Company.

         Each Holder agrees that, upon receipt of any notice from the Company of
the happening of any event of the kind described in Section 2.5, such Holder
will forthwith discontinue disposition of Registrable Securities until such
Holder's receipt of the copies of the supplemented or amended disclosure
document contemplated by Section 2.5 hereof, and, if so directed by the Company,
such Holder will deliver to the Company (at the Company's expense) all copies
(including, without limitation, any and all drafts), other than permanent file
copies, then in such Holder's possession, of the disclosure document covering
such Registrable Securities current at the time of receipt of such notice. In
the event the Company shall give any such notice, the period mentioned in
Section 2.2 shall be extended by the greater of (x) three months or (y) the
number of days during the period from and including the date of the giving of
such notice pursuant to Section 2.5 hereof to and including the date when each
Holder covered by such Registration Statement shall have received the copies of
the supplemented or amended disclosure document contemplated by Section 5.6.

         3.       Indemnification.

                  3.1. Indemnification by the Company. In the event of any
Registration of any securities of the Company under the Securities Act pursuant
to this Agreement, the Company will indemnify and hold harmless, to the full
extent permitted by law, each of the Holders of any Registrable Securities
covered by such Registration Statement, their respective directors and officers,
general partners, limited partners and managing directors, each person who
participates as an underwriter in the offering or sale of such securities and
each other person, if any, who controls, is controlled by or is under common
control with any such Holder or any such underwriter within the meaning of the
Securities Act (and directors, officers, controlling persons, partners and
managing directors of any of the foregoing), against any and all losses, claims,
damages or liabilities, joint or several, and expenses (including any amounts
paid in any settlement effected with the Company's consent, which consent will
not be unreasonably withheld) to which such Holder, any such director or officer
or general or limited partner or managing director or any such underwriter or
controlling person may become subject under the Securities Act, state securities
or "blue sky" laws, common law or otherwise, insofar as such losses, claims,
damages or liabilities (or actions or proceedings in respect thereof) or
expenses arise out of or are based upon (i) any untrue statement or alleged
untrue statement of any material fact contained, on the effective date thereof,
in any Registration Statement under which such securities were registered under
the Securities Act, any preliminary, final or summary disclosure document
contained therein, or any amendment or supplement thereto, (ii) any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, or (iii) any
violation or alleged violation by the Company of any federal, state or common
law rule or regulation applicable to the Company and relating to action required
of or inaction by the Company in connection with any such Registration. The
Company shall reimburse each such Holder and each such director,

                                      - 5 -

<PAGE>

officer, general partner, limited partner, managing director or underwriter and
controlling person for any legal or any other expenses reasonably incurred by
them in connection with investigating or defending such loss, claim, liability,
action or proceeding, provided, that the Company shall not be liable in any such
case to the extent that any such loss, claim, damage, liability (or action or
proceeding in respect thereof) or expense arises out of or is based upon any
untrue statement or alleged untrue statement or omission or alleged omission
made in such Registration Statement or amendment or supplement thereto or in any
such preliminary, final or summary disclosure document in reliance upon and in
conformity with written information furnished to the Company through an
instrument duly executed by such Holder in its capacity as a Holder in the
Company or any such director, officer, general or limited partner, managing
director or underwriter specifically stating that it is for use in the
preparation thereof. The indemnity provided for herein shall remain in full
force and effect regardless of any investigation made by or on behalf of such
Holder or any such director, officer, general partner, limited partner, managing
director, underwriter or controlling person and shall survive the transfer of
such securities by such Holder.

                  3.2. Indemnification by the Holders and Underwriters. Any
Holder the Registrable Securities of which are included in any Registration
Statement shall, severally (and not jointly with any other Holder), indemnify
and hold harmless (in the same manner and to the same extent as set forth in
paragraph (a) above) the Company and its directors, officers, controlling
persons from such Registration Statement, any preliminary, final or summary
disclosure document contained therein, or any amendment or supplement, if such
statement or alleged statement or omission or alleged omission was made in
reliance upon and in conformity with written information furnished to the
Company or its representatives through an instrument duly executed by or on
behalf of such Holder specifically stating that it is for use in the preparation
of such Registration Statement, preliminary, final or summary disclosure
document or amendment or supplement, or a document incorporated by reference
into any of the foregoing. No Holders shall be liable in the aggregate for any
amounts exceeding the product of the sale price per Registrable Security (after
deduction of applicable underwriting discounts and commissions and transfer
taxes) and the number of Registrable Securities sold pursuant to such
Registration Statement or disclosure document by such Holder.

                  3.3. Notices of Claims, etc. Promptly after receipt by an
indemnified party hereunder of written notice of the commencement of any action
or proceeding with respect to which a claim for indemnification may be, made
pursuant to this Section 3, such indemnified Party will, if a claim in respect
thereof is to be made against an indemnifying party, promptly give written
notice to the indemnifying party of the commencement of such action, provided
that the failure of any indemnified party to give notice as provided herein
shall not relieve the indemnifying party of its obligations under the preceding
subsections of this Section, except to the extent that the indemnifying party is
actually materially prejudiced by such failure to give notice. In case any such
action is brought against an indemnified party, unless in such indemnified
party's reasonable judgment a conflict of interest between such indemnified and
indemnifying parties may exist in respect of such claim, the indemnifying party
will be entitled to participate in and, jointly with any other indemnifying
party similarly notified, to assume the defense thereof, to the extent that it
may wish, with counsel reasonably satisfactory to such indemnified party, and
after notice from the indemnifying party to such indemnified party of its
election to assume the defense thereof, the indemnifying party will not be
liable to such

                                      - 6 -

<PAGE>

indemnified party for any legal or other expenses subsequently incurred by the
latter in connection with the defense thereof, unless in such indemnified
party's reasonable judgment a conflict of interest between such indemnified and
parties arises in respect of such claim after the assumption of the defense
thereof, and the indemnifying party will not be subject to any liability for any
settlement made without its consent (which consent shall not be unreasonably
withheld). No indemnifying party will consent of any judgment or enter into any
settlement which does not include as an unconditional term thereof the giving by
the claimant or plaintiff to such indemnified party of a release from all
liability in respect to such claim or litigation. An indemnifying party who is
not entitled to, or elects not to, assume the defense of a claim will not be
obligated to pay the fees and expenses of more than one counsel in any single
jurisdiction for all parties indemnified by such indemnifying party with respect
to such claim, unless in the reasonable judgment of any indemnified party a
conflict of interest may exist between such indemnified party and any other of
such indemnified parties with respect to such claim, in which event the
indemnifying party shall be obligated to pay the fees and expenses of such
additional counsel or counsels as may be reasonably necessary. Notwithstanding
anything to the contrary set forth herein, and without limiting any of the
rights set forth above, in any event any party will have the right to retain, at
its own expense, counsel with respect to the defense of a claim.

                  3.4. Other Indemnification. Indemnification similar to that
specified in the preceding subsections of this Section 3 (with appropriate
modifications) shall be given by the Company and each Holder with respect to any
required Registration or other qualification of securities under any federal or
state law or regulation or governmental authority other than the Securities Act.

                  3.5. Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
this Section is for any reason held to be unenforceable although applicable in
accordance with its terms, the Company, the Holders and the underwriters shall
contribute to the aggregate losses, liabilities, claims, damages and expenses of
the nature contemplated by such indemnity agreement incurred by the Company, the
Holders and the underwriters, in such proportions that the underwriters are
responsible for that portion represented by the percentage that the underwriting
discount appearing in the disclosure document bears to the public offering price
appearing therein and the Company and the Holders are responsible for the
balance; provided, however, that no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation. As between the Company and the Holders, such
parties shall contribute to the aggregate losses, liabilities, claims, damages
and expenses of the nature contemplated by such indemnity agreement in such
proportion as shall be appropriate to reflect (x) the relative benefits received
by the Company, on the one hand, and the Holders of the Registrable Securities
included in the offering on the other hand, from the offering of the Registrable
Securities and any other securities included such offering, and (y) the relative
fault of the Company, on the one hand, and the Holders of the Registrable
Securities included in the offering, on the other, with respect to the
statements or omissions which resulted in such loss, liability, claim, damage or
expense, or action in respect thereof as well as any other relevant equitable
considerations. The relative benefits received by the Company, on the one hand,
and the Holders of the Registrable Securities on the other, with respect to such
offering shall be deemed to be in the same

                                      - 7 -

<PAGE>

proportion as the sum of the total purchase price paid to the Company in respect
of the Registrable Securities plus the total net proceeds from the offering of
any securities included in such offering (before deducting expenses) received by
the Company bears to the amount by which the total net proceeds from the
offering of Registrable Securities (before deducting expenses but after
deducting applicable underwriting discounts and commissions and transfer taxes)
received by the Holders of the Registrable Securities with respect to such
offering exceeds the purchase price paid to the Company in respect of the
Registrable Securities, and in each case the net proceeds received from such
offering shall be determined as set forth in the disclosure document. The
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied by the Company
or the Holders of the Registrable Securities, the intent of the parties and
their relative knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Company and the Holders of the
Registrable Securities agree that it would not be just and equitable if
contribution pursuant to this Section were to be determined by pro rata
allocation or by any other method of allocation which does not take into account
the equitable considerations referred to herein. Notwithstanding anything to the
contrary contained herein, the Company and the Holders agree that any
contribution required to be made by such Holder pursuant to this Section 3.5
shall not exceed the net proceeds from the offering of Registrable Securities
(before deducting expenses but after deducting applicable underwriting discounts
and commissions and transfer taxes) received by such Holder with respect to such
offering. For purposes of this Section, each Person, if any, who controls a
Holder or an underwriter within the meaning of Section 15 of the Securities Act
shall have the same rights to contribution as such Holder or Underwriter, and
each director of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company within
the meaning of Section 15 of the Securities Act shall have the same rights to
contribution as the Company.

         3.6.     Rule 144.

         The Company will furnish to any Holder, upon request made by such
Holder at any time, a written statement signed by the Company, addressed to such
Holder, describing briefly the action the Company has taken or proposes to take
to comply with the current public information requirements of Rule 144 or Rule
144A. The Company will, at the request of any Holder, remove from the stock
certificates representing such Registrable Securities that portion of any
restrictive legend which relates to the registration provisions of the
Securities Act on the second anniversary date of this Agreement, provided that
the Holder is not at this time (or within the previous 90 days) and affiliate of
the Company.

         4.       DEFERRAL; BLACK-OUT. Notwithstanding anything in this
Agreement to the contrary, if the Company shall furnish to the Holders named in
any registration statement filed hereunder a certificate signed by the President
or Chief Executive Officer of the Company stating that the Board of Directors of
the Company has made the good faith determination (after consultation with
counsel) (i) that continued use by the Holders of the Registration Statement for
purposes of effecting offers or sales of Registrable Securities pursuant thereto
would require, under the Securities Act, premature disclosure in such
registration statement (or the prospectus relating thereto) of material,
nonpublic information (the "NON-PUBLIC

                                      - 8 -

<PAGE>

INFORMATION")concerning the Company, its business or prospects or any proposed
material transaction involving the Company, (ii) that such premature disclosure
would be materially adverse to the Company or any such proposed material
transaction or would make the successful consummation by the Company of any such
material transaction significantly less likely and (iii) that it is therefore
essential to suspend the use by the Holders of such registration statement (and
the prospectus relating thereto) for purposes of effecting offers or sales of
Registrable Securities pursuant thereto, then the right of the Holders to use
the registration statement (and the prospectus relating thereto) for purposes of
effecting offers or sales of Registrable Shares pursuant thereto shall be
suspended for a period (the "SUSPENSION PERIOD") of not more than 120 days after
delivery by the Company of the certificate referred to above in this Section 4.
During the Suspension Period, none of the Holders shall offer or sell any
Registrable Securities pursuant to or in reliance upon the registration
statement (or the prospectus relating thereto). Notwithstanding the foregoing
(a) if disclosure of the Non-Public Information is made during a Suspension
Period, then the Company shall promptly terminate the Suspension Period and
immediately notify the Holders of such termination and (b) the Company may not
implement the right to initiate a Suspension Period more than twice in any
twelve month period. To the extent that the Company initiates one or more
Suspension Periods hereunder, the Company shall maintain the effectiveness of
the Registration Statement for an additional number of days equal to the
aggregate amount of days that the Company implemented such Suspension Periods.

         5.       Miscellaneous.

                  5.1 No Waiver; Cumulative Remedies. No failure or delay on the
part of any party to this Agreement in exercising any right, power or remedy
hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any such right, power or remedy preclude any other further exercise
thereof or the exercise of any other right, power or remedy hereunder.

                  5.2 Notices. All notices and other communications from the
Company to the Holders shall be mailed by recognized overnight courier first
class registered or certified air mail, postage prepaid, at such address as may
have been furnished to the Company in writing by such Holder, or, until an
address is so furnished, to and at the address of the last Holders who has so
furnished an address to the Company.

                  5.3 Modification, etc. This Agreement and any term hereof may
be changed, waived, discharged or terminated only by an instrument in writing
signed by the Holders of a majority of the Registrable Securities and the
Company. This Agreement is being delivered in The Commonwealth of Massachusetts
and shall be construed and enforced in accordance with and governed by the laws
of such commonwealth without regard to its conflict of laws principles. All
section headings herein are for purposes of reference only and shall not limit
or otherwise affect the meaning hereof.

                  5.4 No Inconsistent Agreements. The Company will not, at any
time after the effective date of this Agreement, enter into any agreement or
contract (whether written or oral) with respect to any of its securities which
is inconsistent in any respect with the registration

                                      - 9 -

<PAGE>

rights granted by the Company to the Holders of the Warrants pursuant to this
Agreement or otherwise conflicts with the provisions hereof.

                  5.5 Assignment. This Agreement shall inure to the benefit and
be binding upon each Holder and its heirs, successors and assigns. The Company's
obligations under this Agreement shall not be assigned, and its duties under
this Agreement shall not be delegated.

                  5.6 Legend. Any shares issued in connection with the exercise
of the Warrants shall bear the following legend:

          THE SECURITIES EVIDENCED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED
  UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), AND HAVE BEEN TAKEN
  FOR INVESTMENT PURPOSES ONLY, AND NOT WITH A VIEW TO THE DISTRIBUTION THEREOF,
  AND SUCH SECURITIES MAY NOT BE SOLD, PLEDGED OR TRANSFERRED UNLESS THERE IS AN
  EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT COVERING SUCH SECURITIES OR THE
  COMPANY RECEIVES AN OPINION OF COUNSEL (WHICH MAY BE COUNSEL FOR THE COMPANY),
  REASONABLY SATISFACTORY IN FORM AND CONTENT TO THE COMPANY, STATING THAT SUCH
  SALE OR TRANSFER IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY
  REQUIREMENTS OF THE ACT.

         6.       Certain Definitions.

         "COMMISSION" shall mean the Securities and Exchange Commission or any
other federal agency then administering the Securities Act of the Exchange Act.

         "EFFECTIVE" shall mean that all requirements under the Securities Act
with respect to a Registration Statement have been satisfied and that the
Commission has declared the Registration Statement effective.

         "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.

         "REGISTRABLE SECURITIES" shall mean (i) all shares of Common Stock and
other securities issued or issuable upon exercise of the Warrants, and (ii) all
shares of Common Stock and other securities directly or indirectly issued or
issuable with respect to such Common Stock or other securities by way of stock
dividend, or stock split or in connection with a combination of shares,
recapitalization, merger, consolidation, or other reorganization. As to any
particular Registrable Securities, such securities shall cease to be Registrable
Securities when they have been (a) effectively registered under the Securities
Act and disposed of in accordance with the registration statement covering them
or (b) distributed to the public through a broker, dealer or market maker
pursuant to Rule 144 under the Securities Act.

                                     - 10 -

<PAGE>

         "REGISTRATION" shall mean registration of the Company's Common Stock
pursuant to an Effective Registration Statement.

         "REGISTRATION STATEMENT" shall mean any disclosure document that the
Company is required to file under the Securities Act in connection with a public
offering of Registrable Securities.

         "SECURITIES ACT" shall mean the Securities Act of 1933, as amended from
time to time or any other federal act, rule or regulation requiring Registration
with any federal agency in connection with a public offering of Registrable
Securities.

                                     - 11 -

<PAGE>

         IN WITNESS WHEREOF, MICROFINANCIAL INCORPORATED has caused this
Registration Rights Agreement to be duly executed as a document under seal by
its duly authorized officer this 14th day of April, 2003.

                                             MICROFINANCIAL INCORPORATED

                                             By: /s/ Authorized Signatory
                                                 ----------------------------
                                                 Name:
                                                 Title:

                                             FLEET NATIONAL BANK

                                             By: /s/ Authorized Signatory
                                                 ----------------------------
                                                 Name:
                                                 Title:

                                             BANKNORTH, N.A.

                                             By: /s/ Authorized Signatory
                                                 ----------------------------
                                                 Name:
                                                 Title:

                                             BROWN BROTHERS HARRIMAN & CO.

                                             By: /s/ Authorized Signatory
                                                 ----------------------------
                                                 Name:
                                                 Title:

                                             CITIBANK

                                             By: /s/ Authorized Signatory
                                                 ----------------------------
                                                 Name:
                                                 Title:

                                             CITIZENS BANK OF MASSACHUSETTS

                                             By: /s/ Authorized Signatory
                                                 ----------------------------
                                                 Name:
                                                 Title:

<PAGE>

                                             KEYBANK NATIONAL ASSOCIATION

                                             By: /s/ Authorized Signatory
                                                 ----------------------------
                                                 Name:
                                                 Title:

                                             NATIONAL CITY BANK

                                             By: /s/ Authorized Signatory
                                                 ----------------------------
                                                 Name:
                                                 Title:

                                             U.S. BANK

                                             By: /s/ Authorized Signatory
                                                 ----------------------------
                                                 Name:
                                                 Title:

                                             UNION BANK OF CALIFORNIA, N.A.

                                             By: /s/ Authorized Signatory
                                                 ----------------------------
                                                 Name:
                                                 Title:

                                     - 13 -
<PAGE>

                                   SCHEDULE A
                                     HOLDERS

Fleet National Bank
Banknorth, N.A.
Brown Brothers Harriman & Co.
Citibank
Citizens Bank of Massachusetts
Keybank National Association
National City Bank
U.S. Bank
Union Bank of California, N.A.<PAGE>

                                                                    EXHIBIT 10.6

                                 April 15, 2003

Ambac Assurance Corporation
One State Street Plaza
New York, NY 10004

Wells Fargo Bank Minnesota, National Association,
         as indenture trustee under the Indenture described below
Attention: Corporate Trust Services/Asset-Backed Administration
Sixth Street and Marquette Avenue
MAC N9311-161
Minneapolis, MN 55479
Fax: (612) 667-3464

MFI Finance Corp. I
950 Winter Street, Suite 4100B
Waltham, MA 02451

Leasecomm Corporation
950 Winter Street, Suite 4200
Waltham, MA 02451

Re:      Direction and Permanent Waiver of Trigger Events and Servicer Events of
         Default

Ladies and Gentlemen:

         Reference is made to the (i) Amended and Restated Indenture, dated as
of September 1, 2001, among MicroFinancial Incorporated, MFI Finance Corp. I,
and Wells Fargo Bank Minnesota, National Association ("Wells Fargo"), as amended
and supplemented from time to time (the "Indenture"), pursuant to which Wells
Fargo is appointed to serve as indenture trustee (in such capacity, the
"Indenture Trustee") on behalf of the noteholders and Ambac Assurance
Corporation ("Ambac"), (ii) Servicing Agreement, dated as of March 1, 2000, as
amended from time to time (the "Servicing Agreement"), among MicroFinancial
Incorporated, MFI Finance Corp. I, Wells Fargo, and the Indenture Trustee,
pursuant to which, among other things, Wells Fargo is appointed to serve as
back-up servicer (the "Back-up Servicer"), (iii) Insurance and Indemnity
Agreement, dated December 18, 2000 (the "Series 2000-2 Insurance Agreement"),
among Ambac, MFI Finance Corp. I, Leasecomm Corporation, MicroFinancial
Incorporated, the Indenture Trustee, and the Back-up Servicer, (iv) Insurance
and Indemnity Agreement, dated September 21, 2001 (the "Series 2001-3 Insurance
Agreement" and, together with the Series 2000-2 Insurance Agreement, the
"Insurance Agreements"), among Ambac, MFI Finance Corp. I, Leasecomm
Corporation, MicroFinancial Incorporated, the Indenture Trustee, and the Back-up
Servicer, (v) Amended and Restated Direction and Waiver of Trigger Event and
Servicer Event of Default, dated January 14, 2003 (the "January 14 Waiver"),
among Ambac Assurance Corporation, MicroFinancial Incorporated, and MFI Finance
Corp. I, and acknowledged and agreed to by the Indenture Trustee. Capitalized
terms not otherwise defined herein have the meanings ascribed thereto in the
Indenture.

<PAGE>

         Please execute this Direction and Permanent Waiver in the space
provided below for your signature and return it to the undersigned to evidence
your agreement to the following:

         REPRESENTATIONS AND WARRANTIES REGARDING COVERED EVENTS.

             1.   MicroFinancial Incorporated hereby represents and warrants to
                  Ambac that (a) no Events of Default under the Indenture exist
                  on the date hereof and (b) the only Events of Default (as
                  defined in the Insurance Agreements), Servicer Events of
                  Default and Trigger Events existing on the date hereof (or
                  that would exist absent the January 14 Waiver or this
                  Permanent Waiver) are those that arise directly or indirectly
                  out of the following (collectively, the "Covered Events"):

                       a.   The occurrence of an event of default under the
                            Credit Agreement arising out of any of the following
                            (and terms in this paragraph a related to financial
                            covenants have the meanings ascribed thereto in the
                            Credit Agreement, as applicable) :

                                 i.   for the fiscal quarter ended September 30,
                                      2002, or any fiscal quarter thereafter,
                                      the Fixed Charge Ratio of MicroFinancial
                                      Incorporated and its subsidiaries being
                                      less than 1.30 to 1.00,

                                 ii.  at any time on or after December 31, 2002,
                                      Consolidated Tangible Net Worth of the
                                      Borrower being less than the sum of (x)
                                      $77,500,000 and (y) 50% of the aggregate
                                      amount of Consolidated Net Income of the
                                      Parent and its Subsidiaries, including the
                                      Borrower, for each of the fiscal quarters
                                      ending after June 30, 2000, but without
                                      deducting therefrom any amount of
                                      Consolidated Net Deficit for any of such
                                      fiscal quarters,

                                 iii. at any time on or after September 30, 2002
                                      and before the effective date of the
                                      Credit Agreement Amendment (described
                                      under "Documentation" below), the Total
                                      Outstandings under the Credit Agreement
                                      exceeding the Borrowing Base, or

                                 iv.  Leasecomm Corporation's failure to repay
                                      the Loans on the Borrowing Base Maturity
                                      Date;

                            and in each case such event of default, if any, not
                            being cured, remedied or waived in writing, in
                            accordance with the terms of the Credit Agreement,
                            within 30 days of the date of initial occurrence of
                            such event of default (which could otherwise
                            constitute a Servicer Event of Default under Section
                            6.01(viii) of the Servicing Agreement, leading to a
                            Trigger Event under the Indenture unless waived by
                            the Controlling Party);

                       b.   For the fiscal quarter ended September 30, 2002 or
                            any fiscal quarter thereafter, the fixed charge
                            ratio of the Reported Companies being less than 1.25
                            to 1.0 (which could otherwise constitute a Servicer
                            Event of Default under Section 6.01(xi) of the
                            Servicing Agreement, leading to a Trigger Event
                            under the Indenture if not waived by the Controlling
                            Party);

                       c.   At any time on or after December 31, 2002, the Net
                            Worth Requirement not being met and such failure to
                            meet the Net Worth Requirement remaining uncured for
                            a period of thirty days after delivery of the
                            financial statements reflecting such failure or
                            after the date on which such financial statements
                            were

                                       2

<PAGE>

                           required to have been delivered (which failure, if it
                           remained uncured, could otherwise constitute a
                           Trigger Event under the Indenture unless waived by
                           the Controlling Party).

             2.   MFI Finance Corp. I hereby represents and warrants to Ambac
                  that (a) no Events of Default under the Indenture exist on the
                  date hereof, (b) to the best of MFI Finance Corp. I's
                  knowledge, the only Events of Default (as defined in the
                  Insurance Agreements), Servicer Defaults, and Trigger Events
                  existing on the date hereof (or that would exist absent the
                  January 14 Waiver or this Direction and Permanent Waiver) are
                  those that arise directly or indirectly out of the Covered
                  Events.

             3.   Leasecomm Corporation hereby represents and warrants to Ambac
                  that, to the best of Leasecomm Corporation's knowledge, the
                  only Events of Default (as defined in the Insurance
                  Agreements), Servicer Defaults, and Trigger Events existing on
                  the date hereof (or that would exist absent the January 14
                  Waiver or this Direction and Permanent Waiver) are those that
                  arise directly or indirectly out of the Covered Events.

         PERMANENT WAIVER; DIRECTION TO INDENTURE TRUSTEE

                  In consideration of (a) the representations and warranties
         described above, and (b) receipt of the documentation described under
         "Documentation" below (receipt of which shall be conclusively evidenced
         by Ambac's execution and delivery of a counterpart of this Direction
         and Permanent Waiver), pursuant to Section 6.15 of the Indenture and
         Section 6.04 of the Servicing Agreement, Ambac, as the Controlling
         Party, hereby waives, and directs Wells Fargo Bank Minnesota, National
         Association, as Indenture Trustee, to waive, permanently:

                       a.   each existing Event of Default (as defined in the
                            Insurance Agreements), Servicer Default, and Trigger
                            Event that arises directly or indirectly out of any
                            Covered Event, effective retroactively to the date
                            on which such Event of Default, Servicer Default or
                            Trigger Event occurred; and

                       b.   any present or future Events of Default (as defined
                            in the Insurance Agreements), Servicer Defaults, or
                            Trigger Events that would exist pursuant to the
                            provisions that are being removed from the Servicing
                            Agreement and the Indenture pursuant to the
                            Amendments (the "Removed Provisions").

         DOCUMENTATION

         The "Documentation" referred to above consists of the following:

             1.   Fully executed counterpart of the Third Amendment to Servicing
                  Agreement, to be dated on or about the date hereof, among the
                  parties to the Servicing Agreement, in substantially the form
                  of Exhibit A hereto (as executed and delivered by the parties
                  thereto, the "Servicing Agreement Amendment");

             2.   Fully executed counterpart of the First Amendment to Amended
                  and Restated Indenture, to be dated on or about the date
                  hereof, among the parties to the Indenture, in substantially
                  the form of Exhibit B hereto (as executed and delivered by the
                  parties thereto, the "Indenture Amendment" and, together with
                  the Servicing Agreement Amendment, the "Amendments");

                                       3

<PAGE>

             3.   Fully executed counterpart of Second Amendment to Fourth
                  Amended and Restated Revolving Credit Agreement, dated on or
                  about March 31, 2003 (the "Credit Agreement Amendment"), among
                  Leasecomm Corporation, Fleet National Bank and the other
                  financial institutions from time to time party to the Fourth
                  Amended and Restated Revolving Credit Agreement, and Fleet
                  National Bank, as agent;

             4.   Fully executed counterpart of this Direction and Permanent
                  Waiver, acknowledged and agreed to by the Indenture Trustee;

             5.   Waiver fee of $50,000; and

             6.   Permanent waiver by N M Rothschild & Sons Limited of any
                  "servicer events of default" and any consequent "trigger
                  events" under the indenture and servicing agreement related to
                  MFI Finance II, LLC in any way related to the Covered Events
                  or the Removed Provisions.

WAIVER LIMITED TO DESCRIBED EVENTS.

         We expressly acknowledge and agree that the foregoing waivers do not
apply to any Trigger Event, Servicer Event of Default, Event of Default, Event
of Default (as defined in the Insurance Agreements) or other default or similar
event not described under "Permanent Waiver" above (whether occurring before or
after the date hereof).

AGREEMENT TO PAY REASONABLE FEES AND EXPENSES.

         MicroFinancial Incorporated agrees to pay to Jones Day, promptly upon
receipt of an invoice therefor, the reasonable fees and expenses of such firm in
connection with its representation of Ambac in connection with the negotiation
of this Direction and Permanent Waiver and related matters.

                                       4

<PAGE>

COUNTERPARTS

         This Direction and Permanent Waiver may be executed and delivered in
any number of counterparts, each of which when so executed and delivered shall
be deemed to be an original, but all such counterparts shall together constitute
but one and the same instrument. Delivery of an executed counterpart of a
signature page to this Direction and Permanent Waiver by telecopier shall be as
effective as delivery of a manually executed counterpart of this Direction and
Permanent Waiver.

                                      Very truly yours,

                                      MICROFINANCIAL, INCORPORATED

                                      By:    /S/ Richard F. Latour
                                             --------------------------
                                      Name:  Richard F. Latour
                                      Title: President and CFO

CONSENTED & AGREED TO BY:

MFI FINANCE CORP. I

By:    /S/ Peter R. von Bleyleben
       ---------------------------------
Name:  Peter R. von Bleyleben
Title: President

LEASECOMM CORPORATION

By:    /S/ Peter R. von Bleyleben
       ---------------------------------
Name:  Peter R. von Bleyleben
Title: President

AMBAC ASSURANCE CORPORATION

By:    /S/ Harris C. Mehos
       ---------------------------
Name:  Harris C. Mehos
Title: First Vice President

<PAGE>

INDENTURE TRUSTEE ACKNOWLEDGMENT

The Indenture Trustee hereby acknowledges and agrees to the foregoing, and
pursuant to Section 6.15 of the Indenture and Section 6.04 of the Servicing
Agreement hereby permanently waives the within mentioned Servicer Events of
Default and Trigger Events.

WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION, as Indenture Trustee

By: /s/ Cheryl Zimmerman
    -------------------------------
    Name: Cheryl Zimmerman
    Title: Corporate Trust Officer
    Date: 4/14/03

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00052-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00052-of-00352.parquet"}]]