Exhibit
10.4


 


FIRST AMENDMENT


 


FIRST AMENDMENT (this “Amendment”),
dated as of May 6, 2015, by and among ACI Merchant Systems, LLC, a Pennsylvania limited liability company (“ACI”
and together with each other Person joined from time to time to the Loan Agreement (as defined below) as a borrower, “Borrowers”),
JetPay Corporation, a Delaware corporation (“Parent”), AD Computer Corporation, a Pennsylvania corporation (“AD
Computer”), and Metro Bank (“Lender”).


 


BACKGROUND


 


A.        Borrowers, Parent and Lender are parties
to a Loan and Security Agreement dated as of November 7, 2014 (as amended, modified, replaced, substituted for, superseded or restated
from time to time, the “Loan Agreement”); and


 


B.         Borrowers have requested that Lender modify
the minimum EBITDA financial covenant in the Loan Agreement, and based on information provided by Borrowers, Lender has agreed
to such request, all on the terms and subject to the conditions set forth herein.


 


NOW, THEREFORE, with the foregoing
Background incorporated by reference and for other consideration, the receipt and sufficiency of which is hereby acknowledged,
the parties hereto, intending to be legally bound, hereby agree as follows:


 


1.          Defined Terms. Unless otherwise
defined herein (including in the Background), terms defined in the Loan Agreement and the Loan Documents are used herein as therein
defined.


 


2.          Amendment to Loan Agreement.
Section 6.8(d) of the Loan Agreement is amended and restated to read in full as follows:


 


“d. Minimum
EBITDA –Borrowers shall maintain Consolidated EBITDA as of each fiscal quarter end of not less than the amount set forth
below opposite the applicable fiscal quarter end, measured for the measurement period set forth below:


 


	Fiscal Quarter Ending	 	Consolidated EBITDA	 	 	Measurement Period
	 	 	 	 	 	 
	March 31, 2015	 	$	235,000	 	 	Three months ending March 31, 2015
	 	 	 	 	 	 	 
	June 30, 2015	 	$	710,000	 	 	Six months ending June 30, 2015
	 	 	 	 	 	 	 
	September 30, 2015	 	$	1,460,000	 	 	Nine months ending September 30, 2015



 




    	 



    	 



    

 


3.             Representations and Warranties.
Each Loan Party hereby represents and warrants to Lender that:


 


(a)          There exists no Default or Event of Default
under the Loan Agreement as amended hereby;


 


(b)          The representations and warranties made
by Loan Parties in the Loan Documents are true and correct in all material respects on and as of the date hereof as if made on
and as of the date hereof except to the extent such representations and warranties are made only as of a specific earlier date;


 


(c)          The execution and delivery of this Amendment,
by and on behalf of each Loan Party have been duly authorized by all requisite action on behalf of each Loan Party, and this Amendment
constitutes the legal, valid and binding obligations of each Loan Party, enforceable against such Loan Party in accordance with
its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium or similar laws affecting the enforcement of creditors’ rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law);


 


(d)          The execution, delivery and performance
of this Amendment will not violate any applicable provision of law or judgment, order or regulation of any court or of any public
or governmental agency or authority nor conflict with or constitute a breach of or a default under any material instrument to which
any Loan Party is a party or by which any Loan Party or any of its properties is bound; and


 


(e)          No approval, consent or authorization
of, or registration, declaration or filing with, any governmental or public body or authority, or any trustee or holder of any
indebtedness, is required in connection with the valid execution, delivery and performance by any Loan Party of this Amendment.


 


4.            Conditions Precedent. The
effectiveness of the amendments set forth herein is subject to the fulfillment, to the satisfaction of Lender and its counsel,
of the following conditions precedent:


 


(a)          Loan Parties shall have delivered to
Lender this Amendment, duly completed and executed by the Loan Parties


 


(b)          Payment by Borrowers of all of Lender’s
Expenses, including without limitation, the fees and expenses of Ballard Spahr LLP, in accordance with Section 9.6 of the Loan
Agreement.


 




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(c)          The representations and warranties set
forth in the Loan Agreement shall be true and correct in all material respects on and as of the date hereof, except to the extent
such representations and warranties are made as of a specific earlier date.


 


(d)          No Default or Event of Default shall
have occurred and be continuing under the Loan Agreement as amended hereby.


 


5.            Ratification; References; No Waiver.
Except as expressly amended by this Amendment, the Loan Agreement shall continue to be, and shall remain, unaltered and in full
force and effect in accordance with its terms. All references in the Loan Agreement to “this Agreement,” “hereof,”
“hereto” and “hereunder” shall be deemed to be references to the Loan Agreement as amended hereby, and
all references in any of the Loan Documents to the Loan Agreement shall be deemed to be to Loan Agreement as amended hereby. This
Amendment does not and shall not be deemed to constitute a waiver by Lender of any Default, breach, Event of Default, or of any
of Lender’s other rights or remedies. Each Loan Party hereby agrees that its obligations under the Loan Agreement and Loan
Documents are ratified and confirmed and shall continue in full force and effect and shall continue to cover all Obligations. As
security for the payment of the Obligations, and satisfaction by Borrowers of all covenants and undertakings contained in Loan
Agreement and Loan Documents, each Borrower hereby confirms its prior grant to Lender of a continuing first lien on and security
interest in, upon and to all of such Borrower’s now owned or hereafter acquired, created or arising Collateral, and Parent
hereby confirms its prior grant to Lender of a continuing first lien on and security interest in, upon and to the Pledged Collateral
(as defined in the Pledge Agreement).


 


6.            Affirmation of Guaranty. Parent
and AD Computer each hereby acknowledges and agrees that its Surety and Guaranty Agreement continues unimpaired and in full force
and effect, covers the Obligations as amended hereby and runs to the benefit of Lender and constitutes the valid, binding and enforceable
obligation of such Guarantor, subject to no defense, setoff, counterclaim or deduction of any nature.


 


7.            Release. In consideration
of the execution of this Amendment by Lender, each Loan Party hereby releases Lender and its officers, attorneys, agents and employees
from any liability, suit, damage, claim, loss or expense of any kind or nature whatsoever and howsoever arising that any Loan Party
ever had, now has, or may have against Lender arising out of or relating to the Loan Documents or Lender’s acts or omissions
with respect thereto occurring prior to the date hereof. Each Loan Party further states that it has carefully read the foregoing
release, knows the contents thereof and grants the same as its own free act and deed.


 


8.            Miscellaneous.


 


(a)          Expenses. Loan Parties
agree to pay all of Lender’s reasonable out-of-pocket expenses incurred in connection with the preparation, negotiation and
execution of this Amendment, including, without limitation, the reasonable fees and expenses of Ballard Spahr LLP.


 




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(b)          Governing Law. THIS AMENDMENT,
AND ALL RELATED AGREEMENTS AND DOCUMENTS, SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE SUBSTANTIVE LAWS OF THE COMMONWEALTH
OF PENNSYLVANIA. THE PROVISIONS OF THIS AMENDMENT AND ALL OTHER AGREEMENTS AND DOCUMENTS REFERRED TO HEREIN ARE TO BE DEEMED SEVERABLE,
AND THE INVALIDITY OR UNENFORCEABILITY OF ANY PROVISION SHALL NOT AFFECT OR IMPAIR THE REMAINING PROVISIONS WHICH SHALL CONTINUE
IN FULL FORCE AND EFFECT.


 


(c)          Successors and Assigns.
The terms and provisions of this Amendment shall be binding upon and shall inure to the benefit of Loan Parties and Lender and
their respective successors and assigns.


 


(d)          Counterparts. Two or more
duplicate originals of this Amendment may be signed by the parties, each of which shall be an original but all of which together
shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page of this Amendment by telecopy
or e-mail shall be effective as delivery of a manually executed counterpart of this Amendment.


 


(e)          Headings. The headings
of any paragraph of this Amendment are for convenience only and shall not be used to interpret any provision hereof.


 


(f)          Modifications. No modification
hereof or any agreement referred to herein shall be binding or enforceable unless in writing and signed by Borrowers and Lender.


 


(g)         Waiver of Jury Trial. EACH
LOAN PARTY AND LENDER EACH HEREBY WAIVE ANY AND ALL RIGHTS EACH MAY HAVE TO A JURY TRIAL IN CONNECTION WITH ANY LITIGATION, PROCEEDING
OR COUNTERCLAIM ARISING WITH RESPECT TO RIGHTS AND OBLIGATIONS OF THE PARTIES HERETO OR UNDER THE LOAN DOCUMENTS OR WITH RESPECT
TO ANY CLAIMS ARISING OUT OF ANY DISCUSSIONS, NEGOTIATIONS OR COMMUNICATIONS INVOLVING OR RELATED TO ANY PROPOSED RENEWAL, EXTENSION,
AMENDMENT, MODIFICATION, RESTRUCTURE, FORBEARANCE, WORKOUT, OR ENFORCEMENT OF THE TRANSACTIONS CONTEMPLATED BY THE LOAN DOCUMENTS.


 


[signature page follows]


 




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IN WITNESS WHEREOF, the parties hereto have caused this Amendment
to be duly executed and delivered by their proper and duly authorized officers as of the day and year first above written.


 


	 	ACI MERCHANT SYSTEMS, LLC
	 	 	 
	 	By:	/s/ Peter Davidson
	 	Name: 	Peter Davidson
	 	Title:	Secretary
	 	 
	 	JETPAY CORPORATION
	 	 	 
	 	By:	/s/ Peter Davidson
	 	Name: 	Peter Davidson
	 	Title:	Secretary
	 	 
	 	AD COMPUTER CORPORATION
	 	 	 
	 	By:	/s/ Gregory M. Krzemien
	 	Name:	Gregory M. Krzemien
	 	Title:	Treasurer
	 	 
	 	METRO BANK
	 	 	 
	 	By:	/s/ Harry G. Hayman, III
	 	Name:	Harry G. Hayman, III
	 	Title:  	Senior Vice President


 


[Signature Page to First Amendment to ACI
Merchant Loan Documents]