Exhibit 10.2

 

CONSENT AND THIRD AMENDMENT TO 

CREDIT AND GUARANTY AGREEMENT

 

This CONSENT AND THIRD AMENDMENT TO CREDIT AND GUARANTY AGREEMENT (this
“Amendment”), dated as of December 24, 2018, is made by and among PRIORITY
HOLDINGS LLC, a Delaware limited liability company (“Borrower”), the other
Credit Parties party hereto as Guarantors, the Lenders party hereto and GOLDMAN
SACHS SPECIALTY LENDING GROUP, L.P., as administrative agent under the Credit
Agreement referred to below (in such capacity, the “Administrative Agent”). All
capitalized terms used herein (including in this preamble) and not otherwise
defined herein shall have the respective meanings provided to such terms in the
Credit Agreement referred to below.

 

PRELIMINARY STATEMENTS

 

WHEREAS, Borrower has entered into that certain Credit and Guaranty Agreement,
dated as of January 3, 2017, among Borrower, the other Credit Parties party
thereto from time to time as Guarantors, the Lenders party thereto from time to
time and Goldman Sachs Specialty Lending Group, L.P., as Administrative Agent
and Lead Arranger (as amended, restated, amended and restated, supplemented
and/or otherwise modified from time to time, the “Credit Agreement”);

 

WHEREAS, on the date hereof, the Guarantors intend to (a) incur $60,000,000 of
additional term loans (the “Incremental Senior Term Loan”) in favor of certain
lenders under the Senior Credit Agreement and (b) request establishment by
certain lenders under the Senior Credit Agreement of $70,000,000 of delayed draw
term commitments (the “Incremental Senior DDT”), in each case, in accordance
with Section 2.24(a)-(f) of the Senior Credit Agreement (as amended by the
Senior Credit Agreement Amendment (as hereinafter defined));

 

WHEREAS, the proceeds of the Incremental Senior Term Loan will be used (a) to
finance the Direct Connect Acquisition (as defined in the Senior Credit
Agreement Amendment) and (b) to pay certain fees, premiums, costs and expenses
incurred in connection with this Amendment, the Direct Connect Acquisition and
the Senior Credit Agreement Amendment;

 

WHEREAS, the proceeds of the delayed draw term loans incurred with respect to
the Incremental Senior DDT will be used to finance Permitted Acquisitions and to
pay related fees, premiums, costs and expenses in connection therewith;

 

WHEREAS, the Guarantors intend to consummate the Direct Connect Acquisition as a
Permitted Acquisition, pursuant to and in accordance with the Credit Agreement
and the Senior Credit Agreement;

 

WHEREAS, in connection with the foregoing, (a) Borrower has requested that the
Administrative Agent and Requisite Lenders agree to certain amendments to the
Credit Agreement, as more fully set forth herein, (b) the Credit Parties and the
Senior Credit Agreement Agent have requested that the Administrative Agent agree
to amend the Senior Subordination Agreement to provide that the Incremental
Senior Term Loans and the delayed draw term loans pursuant to the Incremental
Senior DDT shall constitute “Senior Indebtedness” under, and as defined in, the
Senior Subordination Agreement so long as (x) such delayed draw term loans are
used solely for Permitted Acquisitions (as defined in each of the Credit
Agreement and the Senior Credit Agreement) and (y) the incurrence of such
delayed draw term loans is conditioned upon satisfaction (without waiver) of
Section 3.02(a)(v)(z) of the Senior Credit Agreement (as in effect on the Third
Amendment Effective Date) and (c) Senior Credit Agreement Agent has requested
that the Administrative Agent consent, under the Senior Subordination Agreement,
to the use of the proceeds of the Incremental Senior Term Loan and delayed draw
term loans related to the Incremental Senior DDT for Permitted Acquisitions;

 

 

 

 

WHEREAS, (a) the Administrative Agent and Requisite Lenders are willing to agree
to such amendments and (b) the Administrative Agent is willing to provide such
consent, in each case, subject to and in accordance with the terms and
conditions set forth herein; and

 

NOW, THEREFORE, for good and valuable consideration, the receipt and adequacy of
which is acknowledged by each party hereto, it is agreed that:

 

SECTION 1.                 Rules of Construction. The rules of construction
specified in Section 1.03 of the Credit Agreement shall apply to this Amendment,
including the terms defined in the preamble and Preliminary Statements hereto.

 

SECTION 2.                 AmendmentS to Credit Agreement. Subject to the
satisfaction (or waiver in writing by Requisite Lenders and the Administrative
Agent) of the conditions set forth in Section 5 hereof, and in reliance on the
representations, warranties, covenants and agreements contained in this
Amendment, the Credit Agreement is hereby amended as follows:

 

(a)           Section 1.01 of the Credit Agreement is amended by deleting the
last paragraph of the definition of “Permitted Acquisition” and inserting the
following new paragraph in lieu thereof:

 

For purposes of greater certainty, (i) the purchase by any Credit Party of
portfolios of Merchant Accounts shall be included as an acquisition subject to
the requirements of the immediately preceding sentence and (ii) with respect to
any Limited Condition Transaction that the Borrower or any of its Subsidiaries
intends to fund (in whole or in part) with the proceeds of any Loans or Senior
Indebtedness, Section 1.08(f) shall apply in determining whether such Limited
Condition Transaction constitutes a Permitted Acquisition.

 

(b)           Section 1.01 of the Credit Agreement is further amended by adding
the following new defined term thereto in the proper alphabetical order:

 

“Third Amendment Effective Date” means December 24, 2018.

 

(c)           Section 6.10 of the Credit Agreement is amended by (i) deleting
“(y)” in the eighth line thereof and inserting “(b)” in lieu thereof and (ii)
deleting the ratio “4.25:1.00” from the tenth line thereof and inserting the
following language in lieu thereof: “(x) 4.50:1.00, solely with respect to the
use of the proceeds of (I) the 2018-2 Incremental Term Loans (as defined in the
Senior Credit Agreement on the Third Amendment Effective Date) and (II) the
Delayed Draw Term Loans (as defined in the Senior Credit Agreement on the Third
Amendment Effective Date) incurred during the Delayed Draw Availability Period
(as defined in the Senior Credit Agreement on the Third Amendment Effective
Date); provided, that prior to the making of any Delayed Draw Term Loan, Pro
Forma Effect will be given only to the 2018-2 Incremental Term Loans made or
being made pursuant to the Senior Credit Agreement and upon the making of any
Delayed Draw Term Loan, Pro Forma Effect will be given only to the 2018-2
Incremental Term Loans and Delayed Draw Term Loans made or being made pursuant
to the Senior Credit Agreement and (y) 4.25:1.00 with respect to any other use
of proceeds.

 

SECTION 3.                 Reference to and Effect on the Credit Agreement. On
and after the date hereof, each reference in the Credit Agreement to “this
Agreement,” “hereunder,” “hereof” or text of like import referring to the Credit
Agreement shall mean and be a reference to the Credit Agreement as amended by
this Amendment. On and after the effectiveness of this Amendment, this Amendment
shall for all purposes constitute a “Credit Document” under and as defined in
the Credit Agreement and the other Credit Documents.

 

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SECTION 4.                 Representations & Warranties; ACKNOWLEDGEMENTS. In
order to induce each Lender party hereto and the Administrative Agent to enter
into this Amendment, each Credit Party:

 

(a)           represents and warrants to each Lender and the Administrative
Agent on and as of the date hereof, that:

 

(i)        Each Credit Party hereto has all requisite power and authority to
execute, deliver and perform its obligations under this Amendment and the Credit
Agreement, in each case, to which it is a party and to carry out the
transactions contemplated thereby.

 

(ii)       The execution, delivery and performance of this Amendment have been
duly authorized by all necessary action on the part of each Credit Party that is
a party thereto.

 

(iii)      This Amendment has been duly executed and delivered by each Credit
Party that is a party thereto and is the legally valid and binding obligation of
such Credit Party, enforceable against such Credit Party in accordance with its
respective terms, except as may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws relating to or limiting creditors’
rights generally or by equitable principles relating to enforceability.

 

(iv)      Each of the representations and warranties set forth in the Credit
Agreement and in the other Credit Documents is true and correct in all material
respects on and as of the date hereof with the same effect as though made on and
as of such date, except to the extent such representations and warranties
expressly relate to an earlier date, in which case they shall be true and
correct in all material respects as of such earlier date; provided, however,
that, any representation and warranty that is qualified as to “materiality,”
“Material Adverse Effect” or similar language shall be true and correct (after
giving effect to any qualification therein) in all respects on such respective
dates.

 

(b)           acknowledges and agrees for the benefit of each Lender and the
Administrative Agent on and as of the date hereof, that:

 

(i)        no right of offset, recoupment, defense, counterclaim, claim, cause
of action or objection exists in favor of such Credit Party against
Administrative Agent or any Lender arising out of or with respect to (x) the
Obligations, this Amendment or the other Credit Documents, (y) any other
documents now or heretofore evidencing, securing or in any way relating to the
foregoing, or (z) the administration or funding of the Loans;

 

(ii)       (x) Administrative Agent’s and the Lenders’ agreement to agree to the
consents and the amendments contained herein does not and shall not create (nor
shall any Credit Party rely upon the existence of or claim or assert that there
exists) any obligation of Administrative Agent or any Lender to consider or
agree to any further waiver, consent or amendment with respect to any Credit
Document, and (y) in the event that Administrative Agent or any Lender
subsequently agrees to consider any further waiver, consent or amendment with
respect to any Credit Document, neither this Amendment nor any other conduct of
Administrative Agent or any Lender shall be of any force and effect on
Administrative Agent’s or any Lender’s consideration or decision with respect
thereto.

 

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SECTION 5.               Conditions Precedent. The effectiveness of this
Amendment is subject to the following conditions:

 

(a)       The Administrative Agent shall have received a duly authorized,
executed and delivered counterpart of the signature page to this Amendment
(whether the same or different counterparts) from each Credit Party named on the
signature pages hereto, the Administrative Agent and the Requisite Lenders.

 

(b)       The Administrative Agent shall have received executed copies of each
Acknowledgement and Consent attached hereto as Exhibit A.

 

(c)       The Administrative Agent shall have received a fully-executed copy of
the third amendment to the Senior Credit Agreement (the “Senior Credit Agreement
Amendment”), in form and substance reasonably satisfactory to the Administrative
Agent.

 

(d)       The effectiveness of the Senior Credit Agreement Amendment shall have
occurred or shall occur concurrently with the effectiveness of this Amendment.

 

(e)       The Administrative Agent shall have received a fully-executed copy of
the Amendment No. 1 to Subordination Agreement (the “Subordination Agreement
Amendment”), in form and substance reasonably satisfactory to the Administrative
Agent.

 

(f)       The effectiveness of the Subordination Agreement Amendment shall have
occurred or shall occur concurrently with the effectiveness of this Amendment.

 

(g)       The Borrower shall have paid all reasonable and documented
out-of-pocket fees and expenses (including the reasonable and documented legal
fees and expenses of Hunton Andrews Kurth LLP, counsel to Administrative Agent)
required to be paid or reimbursed by Borrower under this Amendment and the
Credit Agreement; provided, that an invoice for all such fees and expenses shall
be received by Borrower at least one (1) Business Day prior to the Third
Amendment Effective Date.

 

(h)       Both immediately before and after giving effect to this Amendment, (i)
no Default or Event of Default shall have occurred or be continuing or result
therefrom and (ii) the representations and warranties contained in Section 4 of
this Amendment shall be true and correct.

 

SECTION 6.               SUBORDINATION AGREEMENT AMENDMENT. Each Lender, in
accordance with Section 10.05(a) of the Credit Agreement, hereby (a) consents to
the Subordination Agreement Amendment and (b) authorizes Administrative Agent to
enter into such Subordination Agreement Amendment on behalf of such Lender.

 

SECTION 7.               Reaffirmation. To induce the Lenders party hereto and
Administrative Agent to enter into this Amendment, each of the Credit Parties
hereby acknowledges and reaffirms its obligations under each Credit Document to
which it is a party, in each case, as amended, restated, supplemented or
otherwise modified prior to or as of the date hereof. Each Credit Party
acknowledges and agrees that (a) each of the Credit Documents to which it is a
party or otherwise bound shall continue in full force and effect, that all of
its obligations thereunder shall be valid and enforceable and shall not be
impaired or limited by the execution or effectiveness of this Amendment and (b)
there are no rights of set-off or counterclaim, nor any defenses of any kind,
whether legal, equitable or otherwise, that would enable such Credit Party to
avoid or delay timely performance of its obligations under the Credit Documents.

 

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SECTION 8.               Miscellaneous Provisions.

 

(a)       Ratification. This Amendment is limited to the matters specified
herein and shall not constitute a modification, acceptance or waiver of any
other provision of the Credit Agreement or any other Credit Document. Nothing
herein contained shall be construed as a substitution or novation of the
obligations outstanding under the Credit Agreement or any other Credit Document
or instruments securing the same, which shall remain in full force and effect as
modified hereby or by instruments executed concurrently herewith.

 

(b)       Governing Law; Submission to Jurisdiction, Etc. Sections 10.14, 10.15
and 10.16 of the Credit Agreement are incorporated by reference herein as if
such Sections appeared herein, mutatis mutandis.

 

(c)       Severability. Section 10.11 of the Credit Agreement is incorporated by
reference herein as if such Section appeared herein, mutatis mutandis.

 

(d)       Counterparts; Headings. This Amendment may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. Delivery by telecopier,
.pdf or other electronic imaging means of an executed counterpart of a signature
page to this Amendment shall be effective as delivery of an original executed
counterpart of this Amendment. The Administrative Agent may also require that
signatures delivered by telecopier, .pdf or other electronic imaging means be
confirmed by a manually signed original thereof; provided that the failure to
request or deliver the same shall not limit the effectiveness of this Amendment
or signature delivered by telecopier, .pdf or other electronic imaging means.
Section headings herein are included for convenience of reference only and shall
not affect the interpretation of this Amendment.

 

(e)       Costs and Expenses. The Borrower hereby agrees to pay and reimburse
the Administrative Agent and the Lead Arranger for their respective reasonable
and documented out-of-pocket expenses in connection with the negotiation,
preparation, syndication and execution and delivery of this Amendment, including
the reasonable fees, charges and disbursements of one counsel for the
Administrative Agent and the Lead Arranger, all in accordance with Section 10.02
of the Credit Agreement.

 

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

      BORROWER: PRIORITY HOLDINGS, LLC         By: /s/ Thomas C. Priore   Name:
Thomas C. Priore   Title: Executive Chairman and CEO       GUARANTORS: PIPELINE
CYNERGY HOLDINGS, LLC         By: /s/ Thomas C. Priore   Name: Thomas C. Priore
  Title: Executive Chairman and CEO         PRIORITY INSTITUTIONAL PARTNER
SERVICES LLC         By: /s/ Thomas C. Priore   Name: Thomas C. Priore   Title:
Executive Chairman and CEO         PRIORITY PAYMENT SYSTEMS HOLDINGS LLC        
By: /s/ Thomas C. Priore   Name: Thomas C. Priore   Title: Executive Chairman
and CEO         PRIORITY PAYMENT SYSTEMS LLC         By: /s/ Thomas C. Priore  
Name: Thomas C. Priore   Title: Executive Chairman and CEO

 

 

 

 

        FINCOR SYSTEMS LLC         By: /s/ Thomas C. Priore   Name: Thomas C.
Priore   Title: Executive Chairman and CEO         PIPELINE CYNERGY INC.        
By: /s/ Thomas C. Priore   Name: Thomas C. Priore   Title: Executive Chairman
and CEO         CYNERGY HOLDINGS, LLC         By: /s/ Thomas C. Priore   Name:
Thomas C. Priore   Title: Executive Chairman and CEO         CYNERGY DATA, LLC  
      By: /s/ Thomas C. Priore   Name: Thomas C. Priore   Title: Executive
Chairman and CEO         PRIORITY PAYMENT EXPRESS SYSTEMS LLC         By: /s/
Thomas C. Priore   Name: Thomas C. Priore   Title: Executive Chairman and CEO  
      PRIORITY INTEGRATED PARTNER HOLDINGS, LLC         By: /s/ Thomas C. Priore
  Name: Thomas C. Priore   Title: Executive Chairman and CEO

 

 

 

 

        PRIORITY PAYRIGHT HEALTH SOLUTIONS, LLC         By: /s/ Thomas C. Priore
  Name: Thomas C. Priore   Title: Executive Chairman and CEO         ROSCO ALPHA
DELTA, LLC         By: /s/ Thomas C. Priore   Name: Thomas C. Priore   Title:
Executive Chairman and CEO         PRIORITY REAL ESTATE TECHNOLOGY, LLC        
By: /s/ R. Copley Broer Jr.   Name: R. Copley Broer Jr.   Title: President

 

 

 

 

      ADMINISTRATIVE AGENT: GOLDMAN SACHS SPECIALTY LENDING GROUP, L.P.        
By: /s/ Justin Betzen   Name: Justin Betzen   Title: Senior Vice President      
LENDERS: GOLDMAN SACHS SPECIALTY LENDING HOLDINGS, INC.         By: /s/ Justin
Betzen   Name: Justin Betzen   Title: Senior Vice President

 

 

 

 

Exhibit A

 

ACKNOWLEDGEMENT AND CONSENT

 

December 24, 2018

 

Priority Holdings LLC, a Delaware limited liability company (“Borrower”), the
guarantors party thereto from time to time (“Guarantors”), various lenders from
time to time party thereto (the “Lenders”) and Goldman Sachs Specialty Lending
Group, L.P., as administrative agent (in such capacity, the “Administrative
Agent”), are party to that certain Credit and Guaranty Agreement, dated as of
January 3, 2017 (as the same has been and may be further amended, restated,
supplemented or otherwise modified from time to time, the “Credit Agreement”),
pursuant to which the Lenders have extended to Borrower certain Loans and other
financial accommodations.

 

In connection with the Credit Agreement, SunTrust Bank (“SunTrust”) executed
that certain Subordination Agreement, dated as of January 3, 2017, among
SunTrust, Borrower, Guarantors and Administrative Agent (as amended or otherwise
modified, including as amended on the date hereof, the “Subordination
Agreement”).

 

Borrower, Guarantors, Administrative Agent and the Lenders are amending the
Credit Agreement pursuant to that certain Consent and Third Amendment to Credit
and Guaranty Agreement, dated as of the date hereof (the “Credit Agreement
Amendment”). SunTrust desires to acknowledge and consent to the Credit Agreement
Amendment and reaffirm its rights and obligations under the Subordination
Agreement.

 

In connection with the foregoing, SunTrust hereby acknowledges, consents and
agrees to the Credit Agreement Amendment. Furthermore, SunTrust agrees that the
Subordination Agreement remains in full force and effect and continues to be the
legal valid and binding obligation of SunTrust enforceable against SunTrust in
accordance with its terms.

 

This Acknowledgment and Consent shall be binding upon and inure to the benefit
of the successors and permitted assigns of the undersigned. This Acknowledgment
and Consent shall be governed by, and construed in accordance with, the laws of
the State of New York, without regard to its conflicts of law provisions thereof
(other than Section 5-1401 and 5-1402 of the New York General Obligation laws).

 

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IN WITNESS WHEREOF, the undersigned has caused this Acknowledgement and Consent
to be duly executed and delivered by its duly authorized officer as of the date
first written above.

        SUNTRUST BANK         By: /s/ Andrew Johnson   Name Andrew Johnson  
Title: Director

 

 

 

 

ACKNOWLEDGEMENT AND CONSENT

 

December 24, 2018

 

Priority Holdings LLC, a Delaware limited liability company (“Borrower”), the
guarantors party thereto from time to time (“Guarantors”), various lenders from
time to time party thereto (the “Lenders”) and Goldman Sachs Specialty Lending
Group, L.P., as administrative agent (in such capacity, the “Administrative
Agent”), are party to that certain Credit and Guaranty Agreement, dated as of
January 3, 2017 (as the same has been and may be further amended, restated,
supplemented or otherwise modified from time to time, the “Credit Agreement”),
pursuant to which the Lenders have extended to Borrower certain Loans and other
financial accommodations.

 

In connection with the Credit Agreement, Thomas C Priore and PSD Partners, LLC,
a Delaware limited liability company (together, the “Subordinated Creditors”)
executed that certain Subordination Agreement, dated as of January 3, 2017,
among the Subordinated Creditors, Borrower, Guarantors and Administrative Agent
(the “Subordination Agreement”).

 

Borrower, Guarantors, Administrative Agent and the Lenders are amending the
Credit Agreement pursuant to that certain Consent and Third Amendment to Credit
and Guaranty Agreement, dated as of the date hereof (the “Credit Agreement
Amendment”). Each Subordinated Creditor desires to acknowledge and consent to
the Credit Agreement Amendment and reaffirm its rights and obligations under the
Subordination Agreement.

 

In connection with the foregoing, each Subordinated Creditor hereby
acknowledges, consents and agrees to the Credit Agreement Amendment.
Furthermore, each Subordinated Creditor agrees that the Subordination Agreement
remains in full force and effect and continues to be the legal valid and binding
obligation of such Subordinated Creditor enforceable against such Subordinated
Creditor in accordance with its terms.

 

This Acknowledgment and Consent shall be binding upon and inure to the benefit
of the successors and permitted assigns of the undersigned. This Acknowledgment
and Consent shall be governed by, and construed in accordance with, the laws of
the State of New York, without regard to its conflicts of law provisions thereof
(other than Section 5-1401 and 5-1402 of the New York General Obligation laws).

 

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IN WITNESS WHEREOF, each of the undersigned has caused this Acknowledgement and
Consent to be duly executed and delivered as of the date first written above.

  /s/ Thomas C. Priore   THOMAS C. PRIORE       PSD PARTNERS LLC         By:

/s/ Thomas C. Priore

  Name Thomas C. Priore   Title: Managing Member