**Exhibit 10.2**

 

FOURTH AMENDMENT TOCREDIT AGREEMENT, CONSENT AND WAIVER

 

THIS FOURTH AMENDMENT TO CREDIT AGREEMENT, CONSENT AND WAIVER dated asof August [    ], 2009 (this “Agreement”) isentered into among Goldleaf Financial Solutions, Inc., a Tennessee corporation(the “Borrower”), the Guarantors party hereto, the Lenders party heretoand Bank of America, N.A., as administrative agent for the Lenders (in suchcapacity, the “Administrative Agent”). All capitalized terms used herein and not otherwise defined herein shallhave the meanings given to such terms in the Credit Agreement (as definedbelow).

 

RECITALS

 

WHEREAS, the Borrower, the Lenders and the Administrative Agent enteredinto that certain Second Amended and Restated Credit Agreement, dated as of November 30,2006, as amended by (i) that certain First Amendment to Second Amended andRestated Credit Agreement and Consent dated as of January 17, 2008, (ii) thatcertain Second Amendment to Second Amended and Restated Credit Agreement datedas of December 24, 2008 and (iii) that certain Third Amendment toSecond Amended and Restated Credit Agreement dated as of February 18, 2009(as so amended, and as may be further amended, restated, supplemented orotherwise modified from time to time, the “Credit Agreement”), pursuantto which the Lenders extended certain financial accommodations to the Borrower;

 

WHEREAS,the Borrower has requested that the Lenders (i) consent to (A) deliveryof the financial statements required to be delivered pursuant to Section 6.1(b) ofthe Credit Agreement for the fiscal quarter ending June 30, 2009 by nolater than August 21, 2009 notwithstanding that the Credit Agreementrequires such financial statements to be delivered by no later than August 14,2009 (the “Delayed Delivery of Section 6.1(b) Financial Statements”)and (B) delivery of the Compliance Certificate required to be deliveredpursuant to Section 6.2(b) of the Credit Agreement for thefiscal quarter ending June 30, 2009 by no later than August 21, 2009notwithstanding that the Credit Agreement requires such financial statements tobe delivered by no later than August 14, 2009 (the “Delayed Delivery ofSection 6.2(b) Compliance Certificate” and together with theDelayed Delivery of Section 6.1(b) Financial Statements, the “DelayedDelivery of Financial Information”), (ii) waive the Existing Events of Default (asdefined below) and (iii) amend the Credit Agreement subject to the terms andconditions set forth below; and

 

WHEREAS,the Lenders are willing to do so subject to the terms and conditions specifiedin this Agreement;

 

NOW, THEREFORE, in consideration of the premises and the mutualcovenants contained herein, and for other good and valuable consideration, thereceipt and sufficiency of which are hereby acknowledged, the parties heretoagree as follows:

 

1.             Reaffirmation.  Each of the Loan Parties acknowledges andreaffirms (a) that it is bound by all of the terms of the Credit Agreementand the Loan Documents to which it is a party and (b) that it isresponsible for the observance and full performance of all Obligations,including without limitation, the repayment of the Loans and reimbursement ofany drawings on a Letter of Credit. Furthermore, the Loan Parties acknowledge and confirm (i) that theAdministrative Agent and the Lenders have performed fully all of theirrespective obligations under the Credit Agreement and the other Loan Documentsand (ii) by entering into this Agreement, the Lenders do not waive (exceptas specifically provided in Sections 2 and 3 below) or release any term orcondition of the Credit Agreement or any of the other Loan Documents or any oftheir rights or remedies under such Loan Documents or applicable law or any ofthe obligations of the Loan Parties thereunder.

 

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2.             Consent.  Subject to the other terms and conditions ofthis Agreement, the Lenders hereby consent to the Delayed Delivery of FinancialInformation.  The above consent shall not modify or affect the LoanParties’ obligations to comply fully with the terms of Section 6.1(b) andSection 6.2(b) of the Credit Agreement or any other duty,term, condition or covenant contained in the Credit Agreement or any other LoanDocument in the future.  The consent islimited solely to the specific consent identified above and nothing containedin this Agreement shall be deemed to constitute a waiver (except asspecifically provided in Section 3 below) of any other rights or remediesthe Administrative Agent or any Lender may have under the Credit Agreement orany other Loan Document or under applicable law.

 

3.             Waiver.

 

(a)           The Loan Parties acknowledge that Eventsof Default exist under the Credit Agreement as a result of the failure of theLoan Parties to comply with the terms of Sections 6.12(a) and 6.12(d) ofthe Credit Agreement as of the fiscal quarter ending June 30, 2009 (collectively,the “Existing Events of Default”).

 

(b)           Subject to the terms and conditions set forth herein, theAdministrative Agent, the L/C Issuer and the Lenders hereby waive the ExistingEvents of Default.  The above shall notmodify or affect the Loan Parties’ obligations to comply fully with the termsof Section 6.12(a) and Section 6.12(d) of theCredit Agreement or any other duty, term, condition or covenant contained inthe Credit Agreement or any other Loan Document in the future.  The waiver is limited solely to the ExistingEvents of Default, and nothing contained in this Agreement shall be deemed toconstitute a waiver of any other rights or remedies the Administrative Agent orany Lender may have under the Credit Agreement or any other Loan Documents orunder applicable law.  The provisions andagreements set forth in this Agreement shall not establish a custom or courseof dealing or conduct between the Administrative Agent, the L/C Issuer, anyLender, the Borrower or any other Loan Party.

 

(c)           During the period from the date hereof and thereafter,unless and until (i) the first date subsequent to the date hereof that theAdministrative Agent shall have received a Compliance Certificate required tobe delivered pursuant to Section 6.2(b) of the Credit Agreementdemonstrating that the Loan Parties are in compliance with the financialcovenants set forth in Section 6.12(a) and Section 6.12(d) ofthe Credit Agreement and (ii) no other Default or Event of Default existsand is continuing at the time of receipt by the Administrative Agent of theCompliance Certificate referenced in the foregoing clause (i) of thisparagraph, but subject to the terms of this Agreement:

 

(i)            the Total Outstandings shall notexceed $40,000,000 (or such lesser amount if the Revolving Commitment isreduced below $40,000,000 pursuant to Section 2.4 of the CreditAgreement) (the “Reduced Availability Amount”);

 

(ii)           the aggregate Outstanding Amount ofthe Loans of any Lender plus such Lender’s Applicable Percentage of theOutstanding Amount of all L/C Obligations shall not exceed such Lender’sApplicable Percentage of the Reduced Availability Amount; and

 

(iii)          all other conditions to the making ofRevolving Credit Loans and the issuing or extending of Letters of Credit in theCredit Agreement (including without limitation the conditions set forth in Section 4.2of the Credit Agreement) shall have been satisfied before any Revolving CreditLoans are made or any Letters of Credit issued or extended.

 

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4.             Amendment.  The definition of “Applicable Rate” inSection 1.01 of the Credit Agreement is hereby amended to read asfollows:

 

**‘APPLICABLE RATE’**means, from time to time,the following percentages per annum, based upon the Funded Debt to EBITDA Ratio(the **“Applicable****Financial Covenant”)**as set forth in themost recent Compliance Certificate received by Administrative Agent pursuant toSection 6.2(b):

 
| **Pricing Level** | ** ** | **Funded Debt to EBITDA  Ratio**      | ** ** | **LIBOR Margin** | ** ** | **Base Rate Margin** | ** ** | **Commitment Fee** | ** ** |
|-------------------|------------|---------------------------------------|------------|------------------|------------|----------------------|------------|--------------------|------------|
|              |       |                                  |       |             |       |                 |       |               |       |
| I                 |       | > 3.50 to 1.0                      |       | 3.00             | %          | 0.50                 | %          | 0.625              | %          |
|              |       |                                  |       |             |       |                 |       |               |       |
| II                |       | > 3.00 to 1.0 but < 3.50 to 1.0 |       | 2.75             | %          | 0.25                 | %          | 0.50               | %          |
|              |       |                                  |       |             |       |                 |       |               |       |
| III               |       | > 2.50 to 1.0 but < 3.00 to 1.0 |       | 2.50             | %          | 0.00                 | %          | 0.50               | %          |
|              |       |                                  |       |             |       |                 |       |               |       |
| IV                |       | > 1.50 to 1.0 but < 2.50 to 1.0 |       | 2.00             | %          | 0.00                 | %          | 0.35               | %          |
|              |       |                                  |       |             |       |                 |       |               |       |
| V                 |       | < 1.50 to 1.0                      |       | 1.375            | %          | 0.00                 | %          | 0.25               | %          |

 

Any increase or decrease in the Applicable Rate resulting from a changein the Applicable Financial Covenant shall become effective commencing on the5th Business Day immediately following the date a Compliance Certificate isdelivered pursuant to Section 6.2(b); provided, however, that if aCompliance Certificate is not delivered when due in accordance with suchSection, then Pricing Level I shall apply commencing on the 5th Business Dayfollowing the date such Compliance Certificate was required to have beendelivered.  Commencing upon the 5thBusiness Day following receipt of such delinquent Compliance Certificate, theApplicable Rate shall be adjusted to the appropriate Pricing Level.

 

Notwithstanding the foregoing, from September 1, 2009 andthereafter, unless and until (i) the first date subsequent to September 1,2009 upon which the Administrative Agent shall have received a Compliance Certificaterequired to be delivered pursuant to Section 6.2(b) of theCredit Agreement demonstrating that the Loan Parties are in compliance with thefinancial covenants set forth in Section 6.12(a) and Section 6.12(d) ofthe Credit Agreement and (ii) no other Default or Event of Default existsand is continuing at the time of receipt by the Administrative Agent of theCompliance Certificate referenced in the foregoing clause (i) of thisparagraph (the foregoing clauses (i) and (ii) of this paragraphcollectively, the “Applicable Rate Adjustment Conditions”), theApplicable Rate shall be the following percentages per annum: (a) 4.75%,in the case of LIBOR Loans and Letter of Credit Fees, (b) 3.75%, in thecase of Base Rate Loans and (c) 0.75%, in the case of the CommitmentFee.  Upon satisfaction of the ApplicableRate Adjustment Conditions (such satisfaction to be measured in the solediscretion of the Administrative Agent), the Applicable Rate shall bedetermined based upon the first paragraph of this definition.

 

5.             Conditions Precedent.  This Agreement shall be effective as of thedate hereof when all of the conditions set forth below have been satisfied:

 

(a)           receipt by theAdministrative Agent of counterparts of this Agreement, duly executed by theBorrower, the Guarantors, the Majority Lenders and the Administrative Agent;and

 

(b)             receiptby the Administrative Agent of all fees payable in connection with thisAgreement, including, on behalf of each Lender signing this Agreement on orbefore August 14, 

 

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2009, a fee equal to 0.25% on the amount of suchLender’s Applicable Percentage of the Reduced Availability Amount.

 

6.               Guarantor Acknowledgement.

 

(a)           Eachof the Guarantors hereby acknowledges that it has reviewed the terms andprovisions of the Credit Agreement and this Agreement.  Each of the Guarantors hereby confirms thatthe Subsidiary Guaranty, as applicable, to which it is a party or otherwisebound will continue to guarantee, as the case may be, to the fullest extentpossible in accordance with such Guarantee the payment and performance of all “GuarantiedObligations” under each of the Guarantees, as the case may be (in each caseas such terms are defined in the applicable Guarantee), including withoutlimitation the payment and performance of all such “Obligations” undereach of the Guarantees, as the case may be, in respect of the Obligations ofthe Borrower now or hereafter existing under or in respect of the CreditAgreement and the Notes defined therein.

 

(b)           Eachof the Guarantors acknowledges and agrees that any of the Guarantees to whichit is a party or otherwise bound shall continue in full force and effect andthat all of its obligations thereunder shall be valid and enforceable and shallnot be impaired or limited by the execution or effectiveness of thisAgreement.  Each of the Guarantorsrepresents and warrants that all representations and warranties contained inthe Credit Agreement, this Agreement and the Guarantee to which it is a party orotherwise bound are true, correct and complete in all material respects on andas of the date hereof to the same extent as though made on and as of that date,except to the extent such representations and warranties specifically relate toan earlier date, in which case they were true, correct and complete in allmaterial respects on and as of such earlier date.

 

7.             Release.  As a material part of the consideration for theAdministrative Agent, the L/C Issuer and the Lenders entering into thisAgreement, the Loan Parties agree as follows (the “Release Provision”):

 

(a)           By their signatures below, the Borrower and the other LoanParties hereby agree that the Administrative Agent, the L/C Issuer and each ofthe Lenders, and each of  theirrespective Affiliates, officers, directors, agents and employees, and theirrespective successors and assigns (hereinafter all of the above collectivelyreferred to as the “Bank Group”), are irrevocably and unconditionallyreleased, discharged and acquitted from any and all actions, causes of action,claims, demands, damages and liabilities of whatever kind or nature, in law orin equity, now known or unknown, suspected or unsuspected to the extent thatany of the foregoing arises from any action or failure to act solely in connectionwith the Loan Documents on or prior to the date hereof.

 

(b)           Each Loan Party hereby acknowledges, represents andwarrants to the Bank Group that:

 

(i)            such Loan Party has read andunderstands the effect of the Release Provision.  Such Loan Party has had the assistance ofindependent counsel of its own choice, or has had the opportunity to retainsuch independent counsel, in reviewing, discussing, and considering all theterms of the Release Provision; and if counsel was retained, counsel for such LoanParty has read and considered the Release Provision and advised such Loan Partywith respect to the same.  Beforeexecution of this Agreement, such Loan Party has had adequate opportunity tomake whatever investigation or inquiry 

 

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itmay deem necessary or desirable in connection with the subject matter of theRelease Provision.

 

(ii)           such Loan Party is not acting inreliance on any representation, understanding, or agreement not expressly setforth herein.  Such Loan Partyacknowledges that the Bank Group has not made any representation with respectto the Release Provision except as expressly set forth herein.

 

(iii)          such Loan Party has executed thisAgreement and the Release Provision thereof as its free and voluntary act,without any duress, coercion, or undue influence exerted by or on behalf of anyperson.

 

(iv)          such Loan Party is the sole owner ofthe claims released by the Release Provision, and such Loan Party has notheretofore conveyed or assigned any interest in any such claims to any otherPerson.

 

(c)           Such Loan Party understands that the Release Provision wasa material consideration in the agreement of the Administrative Agent, the L/CIssuer and the Lenders to enter into this Agreement.

 

8.             Representations and Warranties.

 

(a)           The Borrower andeach Guarantor hereby represent and warrant to and in favor of the Lenders asfollows:

 

(i)            theBorrower and each Guarantor has the corporate power and authority (1) toenter into this Agreement and (2) to do all acts and things as arerequired or contemplated hereunder to be done, observed and performed by it;

 

(ii)           thisAmendment has been duly authorized, validly executed and delivered by one ormore Responsible Officers of the Borrower and each Guarantor, and constitutesthe legal, valid and binding obligations of the Borrower and each Guarantor,enforceable against the Borrower and each Guarantor in accordance with itsterms, subject, as to enforcement of remedies, to the following qualifications:  (1) an order of specific performance andan injunction are discretionary remedies and, in particular, may not beavailable where damages are considered an adequate remedy at law and (2) enforcementmay be limited by bankruptcy, insolvency, liquidation, reorganization,reconstruction and other similar laws affecting enforcement of creditors’rights generally (insofar as any such law relates to the bankruptcy, insolvencyor similar event of the Borrower); and

 

(iii)          theexecution and delivery of this Agreement does not and will not require theconsent or approval of any regulatory authority or governmental authority oragency having jurisdiction over the Borrower or any Guarantor which has notalready been obtained, nor be in contravention of or in conflict with thearticles of incorporation or by-laws of the Borrower or any Guarantor, or anyprovision of any statute, judgment, order, indenture, instrument, agreement, orundertaking, to which the Borrower or any Guarantor is party or by which theBorrower’s or any Guarantor’s assets or properties are bound.

 

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(b)           TheBorrower hereby represents and warrants to and in favor of the Lenders asfollows:

 

(i)            eachrepresentation and warranty set forth in Article 5 of the CreditAgreement, as amended hereby, is hereby restated and affirmed as true andcorrect in all material respects as of the date hereof, except to the extent (1) previouslyfulfilled in accordance with the terms of the Credit Agreement, (2) theBorrower has provided the Lenders updates to information provided to theLenders in accordance with the terms of such representations and warranties or (3) relatingspecifically to the Closing Date or otherwise inapplicable; and

 

(ii)           otherthan the Existing Events of Default, no Default exists both before and aftergiving effect to this Agreement, and there has been no Material Adverse Effectboth before and after giving effect to this Agreement.

 

9.             Miscellaneous.

 

(a)           Except as expressly set forth herein, the Credit Agreementshall remain unchanged and in full force and effect and shall constitute thelegal, valid, binding and enforceable obligation of the Borrower to the Lenders,and the Borrower hereby restates, ratifies and reaffirms each and every termand condition set forth in the Credit Agreement, as amended hereby.  The terms of this Agreement are not intendedto and do not serve as a novation as to the Credit Agreement or any Note or theindebtedness evidenced thereby.  Theparties hereto expressly do not intend to extinguish any debt or securityinterest created pursuant to the Credit Agreement or any document executed inconnection therewith.  Instead it is theexpress intention to affirm the Credit Agreement and the security createdthereby.

 

(b)           This Agreement maybe executed in any number of counterparts and by different parties hereto inseparate counterparts, each of which, when so executed and delivered, shall bedeemed to be an original and all of which counterparts, taken together, shallconstitute but one and the same instrument.

 

(c)           This Agreement shallbe binding upon and inure to the benefit of the successors and permittedassigns of the parties hereto.

 

(d)           **THIS AGREEMENT SHALL BEGOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OFGEORGIA, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.**

** **

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Each of the parties hereto has caused a counterpart of this Agreementto be duly executed and delivered as of the date first above written.

 
| BORROWER:   | GOLDLEAF FINANCIAL SOLUTIONS, INC., |
|-------------|-------------------------------------|
|        | as  Borrower                        |
|        |                                |
|        | By:                                 | /s/ Gregory L. Boggs |
|        | Name:                               | Lynn Boggs |
|        | Title:                              | CEO |
|        |                                |   |
|        |                                |   |
| GUARANTORS: | GOLDLEAF TECHNOLOGIES, INC.         |
|        |                                |
|        |                                |
|        | By:                                 | /s/ Gregory L. Boggs |
|        | Name:                               | Lynn Boggs |
|        | Title:                              | CEO |
|        |                                |   |
|        |                                |   |
|        | TOWNE SERVICES, INC.                |
|        |                                |
|        |                                |
|        | By:                                 | /s/ Gregory L. Boggs |
|        | Name:                               | Lynn Boggs |
|        | Title:                              | CEO |
|        |                                |   |
|        |                                |   |
|        | FORSEON CORPORATION                 |
|        |                                |
|        |                                |
|        | By:                                 | /s/ Gregory L. Boggs |
|        | Name:                               | Lynn Boggs |
|        | Title:                              | CEO |
|        |                                |   |
|        |                                |   |
|        | GOLDLEAF LEASING, LLC               |
|        |                                |
|        |                                |
|        | By:                                 | /s/ Gregory L. Boggs |
|        | Name:                               | Lynn Boggs |
|        | Title:                              | CEO |
|        |                                |   |
|        |                                |   |
|        | GOLDLEAF INSURANCE, LLC             |
|        |                                |
|        |                                |
|        | By:                                 | /s/ Gregory L. Boggs |
|        | Name:                               | Lynn Boggs |
|        | Title:                              | CEO |

 

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| LENDERS: | BANK OF AMERICA, N.A.,   |
|----------|--------------------------|
|     | as Lender and L/C Issuer |
|     |                     |
|     | By:                      | /s/ Thomas M Paulk |
|     | Name:                    | Thomas M. Paulk |
|     | Title:                   | Vice President |
|     |                     |   |
|     | THE PEOPLES BANK,        |
|     | as Lender                |
|     |                     |
|     | By:                      | /s/ Paul Rice |
|     | Name:                    | Paul Rice |
|     | Title:                   | 1st VP |
|     |                     |
|     | WACHOVIA BANK, N.A.,     |
|     | as Lender                |
|     |                     |
|     | By:                      | /s/ Brian L. Martin |
|     | Name:                    | Brian L. Martin |
|     | Title:                   | Senior Vice President |

 

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| ADMINISTRATIVE |                     |
|----------------|--------------------------|
| AGENT:         | BANK OF AMERICA, N.A.,   |
|           | as  Administrative Agent |
|           |                     |
|           |                     |
|           | By                       | /s/  Roberto Salazar |
|           | Name:                    | Roberto  Salazar |
|           | Title:                   | Assistant  Vice President |

 

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