FOURTH AMENDMENT TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT
Exhibit
99.1
FOURTH
AMENDMENT TO
AMENDED
AND RESTATED LOAN AND SECURITY AGREEMENT
This
Fourth Amendment to Amended and Restated Loan and Security Agreement (this
“Agreement”) is made and
entered into as of July 23, 2010 by and among (a) nFinanSe Inc., a Nevada
corporation (the “Company”), nFinanSe Payments
Inc., a Nevada corporation (each, a “Borrower”, and together with
the Company, the “Borrowers”) and (b) the
investors identified on the signature pages hereto (each, a “Lender”, and collectively the
“Lenders”). Defined
terms not otherwise defined herein shall have the meanings set forth in the Loan
Agreement (as defined below).
RECITALS
The
Borrowers and the Lenders are parties to that certain Loan and Security
Agreement, dated June 10, 2008, which was amended and restated on November 26,
2008 (as further amended on February 3, 2009 and May 26, 2010, the “Loan Agreement”), pursuant to
which the Company issued to each Lender secured promissory notes in the
aggregate principal amount of $15,500,000, of which $500,000 is currently
outstanding (collectively, the “Notes”).
WHEREAS, the parties hereto
wish to amend certain terms of the Loan Agreement.
NOW, THEREFORE, in
consideration of the terms and conditions contained in this Agreement, and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto, intending to be legally bound hereby, agree as
follows:
1. Amendments
(a)
Amendment to Maturity Date
of the Notes. The “Maturity Date,” as defined in Section 1.1
of the Loan Agreement is hereby amended and restated in its entirety as
follows:
““Maturity Date” shall
mean September 30, 2010.”
(b) Termination of Right to
Request Additional Loans. From and after the date hereof, no
Borrower shall have the right to request additional Loans from Midsummer or
deliver a Notice of Borrowing under the Loan Agreement. As such, the
aggregate principal Commitment amount for Midsummer under the Loan Agreement
shall be capped at $500,000.
2. Inducement to Amend the
Maturity Date. As partial consideration for the amendments
hereunder, the Company will issue 26,667 shares of the its Series E Convertible
Preferred Stock, par value $0.001 (“Series E Preferred Stock”), having the
rights, privileges and preferences set forth in the certificate of designation
attached hereto as Exhibit A, to Midsummer Investment, LTD. as
additional compensation to execute this Agreement. The Series E Preferred Stock
will be issued no later than August 31, 2010.
3. Representations and
Warranties of the Company. The Company hereby makes the
representations and warranties set forth below to the Lenders as of the date of
its execution of this Agreement:
(a)
Authorization;
Enforcement. The Company has the requisite corporate power and
authority to enter into and to consummate the transactions contemplated by this
Agreement and otherwise to carry out its obligations hereunder in accordance
with the terms hereof. The execution and delivery of this Agreement
by the Company and the consummation by it of the transactions contemplated
hereby have been duly authorized by all necessary action on the part of the
Company and no further action is required by the Company, its Board of Directors
or the Company’s stockholders in connection therewith. This Agreement
has been duly executed by the Company and, when delivered in accordance with the
terms hereof, will constitute the valid and binding obligation of the Company
enforceable against the Company in accordance with its terms except (i) as
limited by general equitable principles and applicable bankruptcy, insolvency,
reorganization, moratorium and other laws of general application affecting
enforcement of creditors' rights generally, (ii) as limited by laws relating to
the availability of specific performance, injunctive relief or other equitable
remedies and (iii) insofar as indemnification and contribution provisions may be
limited by applicable law.
(b)
No
Conflicts. The execution, delivery and performance of this
Agreement by the Company and the consummation by the Company of the transactions
contemplated hereby, subject to the terms hereof and thereof, do not and will
not: (i) conflict with or violate any provision of the Company’s or any
Subsidiary’s certificate or articles of incorporation, bylaws or other
organizational or charter documents, or (ii) conflict with, or constitute a
default (or an event that with notice or lapse of time or both would become a
default) under, result in the creation of any Lien upon any of the properties or
assets of the Company or any Subsidiary, or give to others any rights of
termination, amendment, acceleration or cancellation (with or without notice,
lapse of time or both) of, any agreement, credit facility, debt or other
instrument (evidencing a Company or Subsidiary debt or otherwise) or other
understanding to which the Company or any Subsidiary is a party or by which any
property or asset of the Company or any Subsidiary is bound or affected, or
(iii) conflict with or result in a violation of any law, rule, regulation,
order, judgment, injunction, decree or other restriction of any court or
governmental authority to which the Company or a Subsidiary is subject
(including federal and state securities laws and regulations), or by which any
property or asset of the Company or a Subsidiary is bound or affected; except in
the case of each of clauses (ii) and (iii), such as could not have or reasonably
be expected to result in a Material Adverse Effect.
(c) Consideration. Other than the issuance
of Series E Preferred Stock to Midsummer Investment, LTD., no other
consideration has been offered or paid to any party hereto to amend or consent
to a waiver, modification, forbearance or otherwise of any provision of any of
the Notes, the Credit Documents or the Loan Agreement.
(d)
No
Defaults. No Event of Default has occurred and is continuing
as of the date hereof.
4. Public
Disclosure. On or before 8:30 am (Eastern Time) on the fourth
Business Day immediately following the date hereof, the Company shall file a
Current Report on Form 8-K, disclosing the material terms of the transactions
contemplated hereby and attaching this Agreement as an exhibit
thereto. A copy of the Form 8-K shall be provided to the Lenders
before filing. The Company shall consult with the Lenders in issuing
any other press releases with respect to the transactions contemplated
hereby.
5. Effect on Credit
Documents. Except as specifically
provided herein, all of the Credit Documents remain in full force and effect in
accordance with their respective terms. Nothing in this Agreement
shall extend to or affect in any way any of the rights or obligations of the
Company arising under the Credit Documents. The respective
obligations, amendments, agreements of the Lenders hereunder are subject to the
following conditions being met: (a) the accuracy in all material respects of the
representations and warranties of the Company contained herein and (b) the
performance by the Company of all if its obligations, covenants and agreements
required to be performed hereunder and under the Credit Documents.
6. Execution and
Counterparts. This Agreement may be executed in two or more counterparts,
all of which when taken together shall be considered one and the same agreement
and shall become effective when counterparts have been signed by each party and
delivered to the other parties hereto, it being understood that all parties
hereto need not sign the same counterpart. In the event that any
signature is delivered by facsimile transmission or by e-mail delivery of a
“.pdf” format data file, such signature shall create a valid and binding
obligation of the party executing (or on whose behalf such signature is
executed) with the same force and effect as if such facsimile or “.pdf”
signature page were an original thereof.
7. Independent Nature of
Lenders’ Obligations and Rights. The obligations of each
Lender hereunder are several and not joint with the obligations of any other
Lenders hereunder, and no Lender shall be responsible in any way for the
performance of the obligations of any other Lender hereunder. Nothing contained
herein or in any other agreement or document delivered at any closing, and no
action taken by any Lender pursuant hereto, shall be deemed to constitute the
Lenders as a partnership, an association, a joint venture or any other kind of
entity, or create a presumption that the Lenders are in any way acting in
concert with respect to such obligations or the transactions contemplated by
this Agreement. Each Lender shall be entitled to protect and enforce its rights,
including without limitation the rights arising out of this Agreement, and it
shall not be necessary for any other Lender to be joined as an additional party
in any proceeding for such purpose. Each Lender has been represented by its own
separate legal counsel in their review and negotiation of the Credit
Documents. The Company has elected to provide all Lenders with the
same terms and Credit Documents for the convenience of the Company and not
because it was required or requested to do so by the Lenders.
[SIGNATURE
PAGE FOLLOWS]
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IN WITNESS WHEREOF, the
parties hereto have caused this Agreement to be duly executed by their
respective authorized signatories as of the date first indicated
above.
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BORROWERS:
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By:
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/s/
Xxxxxxx X. Xxxxxxxx
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Name:
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Xxxxxxx
X. Xxxxxxxx
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Title:
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Executive
Vice President
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NFINANSE
PAYMENTS INC.
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By:
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/s/
Xxxxxxx X. Xxxxxxxx
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Name:
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Xxxxxxx
X. Xxxxxxxx
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Title:
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Chief
Financial Officer
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********************
[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK; SIGNATURE PAGE FOR LENDERS
FOLLOW]
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[LENDER SIGNATURE PAGE TO FOURTH
AMENDMENT TO AMENDED AND RESTATED LOAN AND SECURITY
AGREEMENT]
IN WITNESS WHEREOF, the
undersigned have caused this Agreement to be duly executed by their respective
authorized signatories as of the date first indicated above.
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LENDERS:
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BALLYSHANNON
PARTNERS, L.P., as Agent and as a Lender
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By:
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/s/
Xxxxx X. Xxxxxx
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Name:
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Xxxxx
X. Xxxxxx
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Title:
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President
of the G.P.
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BALLYSHANNON
FAMILY PARTNERSHIP, L.P.
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By:
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/s/
Xxxxx X. Xxxxxx
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Name:
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Xxxxx
X. Xxxxxx
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Title:
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President
of the G.P.
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MIDSUMMER
INVESTMENT, LTD.
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By:
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/s/
Xxxxxx Xxxxxx
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Name:
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Xxxxxx
Xxxxxx
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Title:
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Authorized
Signatory
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XXXXXX
PARTNERS, L.P.
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By:
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/s/
Xxxxxxx X. Xxxxxx
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Name:
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Xxxxxxx
X. Xxxxxx
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Title:
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General
Partner
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TRELLUS
PARTNERS, L.P.
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By:
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/s/
Xxxx Xxxxx
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Name:
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Xxxx
Xxxxx
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Title:
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President
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