Harte Hanks, Inc. (NYSE:HHS) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01Entry into a Material Definitive Agreement.

On January 9, 2018, Harte Hanks, Inc. (the “Company”) entered into an amendment (the “First Amendment”) to its Credit Agreement, dated as of April 17, 2017 (the “Credit Agreement”), by and between the Company and Texas Capital Bank, National Association (“TCB”). The First Amendment (i) increases the availability under the revolving credit facility (as amended by the First Amendment, the “Credit Facility”) from $20,000,000 to $22,000,000, and (ii) extends the Credit Facility by one year (i.e., to April 17, 2020). The Credit Facility remains secured by substantially all of the assets of the Company to a Security Agreement, dated as of April 17, 2017, between the Company and TCB (as amended by the First Amendment to Security Agreement, dated January 9, 2018). The Company and TCB also entered into a new Revolving Promissory Note, dated January 9, 2018 (the “Revolving Promissory Note”), to evidence the debt under the Credit Facility. The Credit Facility will be used for working capital and general corporate purposes.

The Credit Facility allows for (i) loans up to the lesser of (a) $22,000,000, or (b) a sum equal to 90% of the value of investment grade bonds held in a custodian account plus 50% of the value of cash in the custodian account (the “Borrowing Base”), and (ii) letters of credit issued by TCB up to the least of (x) $5,000,000, or (y) an amount equal to $22,000,000 minus the amount of any revolving credit loans outstanding, or (z) the Borrowing Base minus the amount of any revolving credit loans outstanding. The outstanding amounts advanced under the Credit Facility will be due and payable in full on April 17, 2020.

The Credit Facility continues to be guaranteed by HHS Guaranty, LLC (“HHS Guaranty”), an entity formed by certain members of the Shelton family (descendants of one of the Company’s founders) and related entities. David Copeland, a director of the Company, serves as sole manager of HHS Guaranty. In Connection with the First Amendment, the Company and HHS Guaranty entered into an Amended & Restated Fee, Reimbursement and Indemnity Agreement, dated as of January 9, 2018 (the “Restated Fee Agreement”), to which the fee payable to HHS Guaranty was changed from an annual fee of $480,000 to a quarterly fee of 0.5% of collateral actually pledged by HHS Guaranty (or such smaller portion of the collateral as is required under the Credit Agreement) on the last day of the month prior to such quarterly fee’s due date. The Company expects that the fees payable to HHS Guaranty will be substantially similar in amount.

The Restated Fee Agreement also adds a requirement that HHS Guaranty have one representative on the Company’s Board of Directors, with Mr. Copeland being deemed to satisfy such requirement. The Restated Fee Agreement further provides that in the event that Mr. Copeland (or a successor designee of HHS Guaranty) ceases to serve as a Company director, the Company must use its best efforts to cause a successor designated by HHS Guaranty to become a Company director. If such successor designated by HHS Guaranty is not appointed or elected to the Company’s Board of Directors within 45 days after receipt of notice from HHS Guaranty, then HHS Guaranty shall have the right to purchase the Revolving Promissory Note, and such event shall automatically be deemed to be an Event of Default (as such term is defined in the Credit Agreement).

The foregoing description of the First Amendment, the First Amendment to Security Agreement, the Revolving Promissory Note, and the Restated Fee Agreement is subject to and qualified in all

respects by the full text of the First Amendment, the First Amendment to Security Agreement, the Revolving Promissory Note, and the Restated Fee Agreement, copies of which are filed as Exhibit 10.1, Exhibit 10.2, Exhibit 10.3 and Exhibit 10.4 respectively hereto and which are incorporated herein by reference.

See Item 1.01 above for a description of the Credit Facility.

Item 9.01Financial Statements and Exhibits.

(d) Exhibits. The following exhibits are being filed or furnished herewith:

*Furnished herewith.

HARTE HANKS INC Exhibit
EX-10.1 2 firstamendmenttocreditagre.htm EXHIBIT 10.1 Exhibit FIRST AMENDMENT TO CREDIT AGREEMENTTHIS FIRST AMENDMENT TO CREDIT AGREEMENT (this “Amendment”),…
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About Harte Hanks, Inc. (NYSE:HHS)

Harte Hanks, Inc. (Harte Hanks) is a multi-channel marketing company. The Company’s Customer Interaction business offers a range of marketing services, in media from direct mail to e-mail, including agency and digital services; database marketing solutions and business-to-business lead generation; direct mail, and contact centers. Its agency services are customer engagement agencies specializing in direct and digital communications for both consumer and business-to-business markets. The Company’s digital solutions integrate online services within the marketing mix and include search engine management, display, digital analytics, Website development and design, digital strategy, social media, e-mail, e-commerce and interactive relationship management and a range of other services that support its core businesses.