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EXHIBIT 4(C)(16)
EXECUTION COPY
(COMERICA LOGO)
May 31, 2005
Credit Acceptance Corporation
Suite 3000
25505 West Twelve Mile Road
Southfield, Michigan 48034
Re:
EXTENSION, WAIVER AND AMENDMENT under Third Amended and
Restated
Credit Acceptance Corporation Credit Agreement dated as of June
9, 2004, as amended by First Amendment dated as of December 10,
2004
("Credit Agreement") by and among Credit Acceptance Corporation
("Company"), the Lenders which are parties thereto from time to
time
(each a "Bank" and collectively, the "Banks"), and Comerica Bank
as
Administrative Agent for the Banks (in such capacity, "Agent")
Ladies and Gentlemen:
Reference is made to the Credit Agreement and to the Extension,
Waiver and
Amendment dated April 30, 2005 issued by the Agent under the Credit
Agreement
("April Waiver"). Except as defined to the contrary herein,
capitalized terms
used in this Extension, Waiver and Amendment shall have the
meanings given them
in the Credit Agreement, and if not defined therein, then as
defined in the
April Waiver.
As
you have previously indicated, until certain accounting issues have
been
resolved with the Company's auditors (such issues, referred to in
the April
Waiver as the "Unresolved Accounting Issues"), the Company is
unable to complete
its audited financial statements for the fiscal year ending
December 31, 2004
and to deliver those financial statements to the Banks as required
under Section
7.3(b) of the Credit Agreement or to file the Company's 10-K report
with the
federal Securities and Exchange Commission as required under
Section 7.3 (f) of
the Credit Agreement and under applicable law. Under the April
Waiver, Agent and
the Banks, among other things, extended the applicable time periods
for such
deliveries to May 31,2005 and waived the defaults under the Credit
Agreement
resulting from the Company's failure to file its Form 10-K.
In
your request letter dated May 18, 2005 ("Request Letter"), you
have
indicated that there has been no resolution of the Unresolved
Accounting Issues
and, in fact, the matter may not be resolved for several months.
Consequently,
you have requested a further extension of the
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Credit Acceptance Corporation
May 31, 2005
Page 2
required time period for delivery of the Company's audited
financial statements
and filing of the Company's Form 10-K and an extension of the
related waivers
and, in addition, an extension of the required time period for the
filing of the
Company's Form 10-Q report required under Section 7.3(f) of the
Credit Agreement
and under applicable law and for related waivers. Furthermore,
recognizing the
Banks' difficulty in considering an extension of the Revolving
Credit Maturity
Date in the absence of audited financial statements and a
resolution of the
Unresolved Accounting Issues, you have asked that the Banks agree
to amend the
payment schedule for the Additional Commitment Fee under Section
2.13(c).
The
Company represents and warrants to Agent and the Banks, as a
continuing
representation and warranty until the Indebtedness under the Credit
Agreement
has been repaid and discharged in full and no commitment to extend
any credit
thereunder remains outstanding, that except as disclosed on
Schedule 1 hereto
("Scheduled Waivers") it has obtained (directly or through a
Subsidiary, as
applicable) all of the waivers, extensions and/or amendments
("Other Waivers")
in respect of (i) all agreements for borrowed money, (ii) all
Permitted
Securitizations and (iii) all other contractual obligations, the
occurrence of a
default under which could reasonably be expected to have a Material
Adverse
Effect, in each case, to address the Unresolved Accounting Issues
so as to
eliminate or continue to postpone the occurrence thereunder of any
event of
default or other event or consequence which could reasonably be
expected to have
a Material Adverse Effect as a result of such issues.
Based on the approval of the requisite Banks (attached to this
letter), the
Agent hereby confirms the following matters:
1. The Banks
extend (i) the time for delivery of the Company's audited
financial statements under Section 7.3(b) of the Credit Agreement,
the time
for
filing of the Company's Form 10-K under Section 7.3(f) of the
Credit
Agreement, in each case for its fiscal year ending December
31,2004, from
May
31, 2005 (as currently required thereunder) to July 31, 2005 and
(ii)
the
time for filing the Company's Form 10-Q under Section 7.3(f) of
the
Credit Agreement (for its first fiscal quarter ending March 31,
2005) from
May
31, 2005 to July 31, 2005 (such required Form 10-K and 10-Q
filings
being referred to herein as the "Required SEC Filings").
2. The Banks
waive any Default or Event of Default due to the Company's
failure to make its Required SEC Filings arising or that may arise
under
any
provision of the Credit Agreement or any of the other Loan
Documents
requiring the Company to make its Required SEC Filings on a timely
basis,
such
waiver to be given retroactive effect to March 31,2005 (in the case
of
its
Form 10-K) and May 10, 2005 (in the case of its Form 10-Q),
provided
that
the waivers under this paragraph shall expire (unless otherwise
extended by the Majority Banks) on the earlier of July 31, 2005 or
the date
on
which the Agent, at the direction or with the concurrence of
the
Majority Banks, terminates this Waiver by written notice to the
Company
("Waiver Expiration Date") due to the
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Credit Acceptance Corporation
May 31, 2005
Page 3
Company's failure to obtain a Scheduled Waiver or upon any of the
Other
Waivers ceasing to be effective, unless replaced with a comparable
Other
Waiver. The Company agrees to notify the Agent and Banks in
writing
promptly upon becoming aware that any of the Other Waivers has
ceased to be
effective and shall deliver to the Agent, promptly following
receipt
thereof, a cop
