Document:

Exhibit 10.12

 

AMENDMENT NO. 3 TO THE CREDIT AGREEMENT,
CONSENT AND

TEMPORARY WAIVER

 

This AMENDMENT
NO. 3 TO THE CREDIT AGREEMENT, CONSENT AND TEMPORARY WAIVER (this "Agreement") is made and entered into as
of February 11, 2016 among FLEXSHOPPER 2, LLC, (the "Company") and WE 2014-1, LLC (the "Administrative
Agent" and "Lender").

 

BACKGROUND

 

WHEREAS,
the Company, the Administrative Agent, Wells Fargo Bank, National Association, as paying agent (the "Paying Agent")
and various lenders from time to time party thereto (the "Lenders") are party to a certain Credit Agreement, dated
March 6, 2015 (as amended, supplemented and otherwise modified as of the date hereof, the "Credit Agreement");

 

WHEREAS,
the parties to the Credit Agreement desire to amend the Credit Agreement;

 

WHEREAS,
the Company has requested that the Lender and the Administrative Agent temporarily waive certain provisions of the Credit Agreement
and provide certain consents as set forth in this Agreement. The Lender and the Administrative Agent are willing to grant such
temporary waiver and provide such consents, subject to the terms and conditions hereof;

 

NOW, THEREFORE,
in consideration of the premises and the mutual agreements herein contained, the parties hereto agree as follows:

 

SECTION
1.Defined Terms. Capitalized definitional terms used in this Agreement and not otherwise defined herein shall
have the meanings assigned to them in the Credit Agreement.

 

SECTION
2.Amendments to the Credit Agreement. The Credit Agreement is hereby amended as follows:

 

(a)The
definition of "Financial Covenant" set forth in Section 1.1 to the Credit Agreement is hereby amended and restated
in its entirety as follows:

 

“Financial
Covenants" means the financial covenants set forth in Section 5.16 hereof and on Schedule 1 hereto."

 

(b)Section
5 of the Credit Agreement is hereby amended by inserting the following as a new Section 5.16 thereof:

 

"5.16 Unrestricted
Cash. The Company shall at all times maintain unrestricted Cash in an amount at least equal to $1,500,000."

 

     

     

    

 

SECTION
3.Temporary Waiver. The Company hereby acknowledges that the Company was not in compliance with the Financial
Covenants for the period ended December 31, 2015 (such non-compliance, the "Breach") and as a result thereof
an Event of Default has occurred and is expected to be continuing. Each of the Lender and the Administrative Agent hereby agrees
(x) to waive the Event of Default solely resulting from the Breach and (y) waive compliance with the Financial Covenants solely
for the period ending March 31, 2016; provided, however, if on or before May 13, 2016, the Company has not presented the Administrative
Agent with sufficient evidence (including, without limitation, an unaudited financial statement for the month of April 2016) that
the Company is in compliance with such Financial Covenants (tested as of April 30, 2016 but at the levels required as of March 31,
2016), then the foregoing waivers shall no longer be effective, the Event of Default resulting from the Breach and the failure,
if any, to comply with the Financial Covenants solely for the period ending March 31, 2016 shall continue to exist and each of
the Lender and the Administrative Agent shall be fully entitled to exercise all rights and remedies with respect thereto under
the Credit Agreement and other Credit Documents.

 

SECTION
4.Consent. Notwithstanding anything to the contrary set forth in the Credit Agreement or any other Credit Document,
each of the Lender and the Administrative Agent hereby acknowledges and consents to the Seller incurring the Indebtedness under
that certain promissory note dated February 11, 2016 in favor of Marc Malaga (the "Note") and the Lien associated
therewith and that the foregoing shall be permitted for all purposes under the Credit Agreement and the other Credit Documents.
Each of the parties hereto acknowledges and understands that such consent is limited solely to the Note and the Liens associated
therewith and does not constitute a waiver or amendment of the Credit Documents generally or with respect to any matter other than
the Note and such Liens.

 

SECTION
5.Effectiveness. This Agreement shall become effective as of the date first written above upon delivery to the
Administrative Agent of (i) counterparts of this Agreement duly executed by each of the parties thereto and (ii) a fully executed
copy of that certain Subordination and Standstill Agreement dated as of February 11, 2016 among the Administrative Agent, Flexshopper,
LLC and Marc Malaga.

 

SECTION
6.Binding Effect; Ratification.

 

(a)The
Credit Agreement, as amended hereby and giving effect to the temporary waivers contained herein, remains in full force and effect.
Any reference to the Credit Agreement from and after the date hereof shall be deemed to refer to such Credit Agreement as amended
hereby, unless otherwise expressly stated.

 

(b)Except
as expressly amended hereby, the Credit Agreement shall remain in full force and effect and is hereby ratified and confirmed by
the parties hereto.

 

(c)Notwithstanding
anything to the contrary herein or in any Credit Document, by signing this Agreement, neither the Lender nor the Administrative
Agent are not now waiving or consenting, nor have they agreed to waive or consent to in the future, the breach of (or any rights
and remedies related to the breach of) any provisions of any of the Credit Documents, other than the Breach and the matters explicating
set forth in this Agreement on a one time basis solely as contemplated herein.

 

    	 	 2	Flexshopper Amendment No. 3

     

    

 

(d)Company
agrees to promptly reimburse the Administrative Agent for all of the reasonable out-of-pocket expenses, including, without limitation,
legal fees, it has heretofore or hereafter incurred or incurs in connection with the preparation, negotiation and execution of
this Agreement and all other instruments, documents and agreements executed and delivered in connection with this Agreement.

 

SECTION
7.Miscellaneous.

 

(a)THIS
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD
TO THE CONFLICT OF LAW PRINCIPLES THEREOF (OTHER THAN SECTIONS 5-1401 AND 5-1402 OF NEW YORK GENERAL OBLIGATIONS LAW).

 

(b)The
captions and headings used herein are for convenience of reference only and shall not affect the interpretation hereof.

 

(c)This
Agreement may be executed in any number of counterparts, each of which when so executed shall be deemed to be an original and all
of which taken together shall constitute one and the same agreement.

 

(d)Executed
counterparts of this Agreement may be delivered electronically.

 

[SIGNATURES FOLLOW]

 

    	 	 3	Flexshopper Amendment No. 3

     

    

 

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

 

	 	ADMINISTRATIVE AGENT and LENDER:
	 	 	 
	 	WE 2014-1, LLC
	 	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 
	 	 	 
	 	THE COMPANY:
	 	 	 
	 	FlexShopper 2, LLC.
	 	 	 
	 	By:	/s/ Brad Bernstein
	 	Name:	Brad Bernstein
	 	Title:	CEO

 

	 	 	 
	 	4	Flexshopper Amendment No. 3Exhibit 10.13

 

PROMISSORY NOTE

 

	$1,000,000.00	February 11, 2016

 

FOR VALUE RECEIVED,
FlexShopper, LLC, a North Carolina limited liability company (“Borrower”), hereby promises to pay to Marc Malaga,
a resident of the State of Florida (“Lender”), on demand, the principal sum of up to One Million and 00/100 Dollars
($1,000,000.00) (the “Maximum Amount”), or such lesser amount as shall have been advanced and remain outstanding
hereunder, together with interest thereon, subject to the terms and conditions set forth in this Promissory Note (this “Note”).

 

1.          
 Payment of Principal and Interest.

 

(a)         
Payments of principal and accrued interest on this Note shall be payable on demand by Lender.

 

(b)         
The unpaid principal balance of this Note shall bear interest at a rate equal to fifteen percent (15.00%) per annum, computed
on the basis of a 360 day year.

 

(c)         
The full remaining portion of all interest accruing on the unpaid principal balance of this Note but not paid in cash pursuant
to Section 1(b) shall continue to accrue until the principal hereof and interest hereon shall have been paid in full.

 

(d)         
Borrower may prepay this Note in whole or in part at any time, without premium or penalty.

 

(e)         
All payments of principal and interest shall be made in lawful money of the United States of America and shall be made to
Lender at Lender’s address set forth in Section 13 or at such other place as Lender may designate to Borrower in writing.

 

(f)          
Upon Borrower’s request, Lender may from time to time after the date hereof advance additional amounts to Borrower
up to the Maximum Amount and subject to the other terms set forth herein. Lender shall make a notation on Schedule A hereto
of each advance made by Lender and of each prepayment or repayment made by Borrower, which schedule shall be conclusive evidence
of the principal amount then outstanding hereunder, absent manifest error, subject to the next sentence. In the event that the
Lender fails to make a notation on Schedule A, then the amount showing as owing from Borrower to Lender on the books and
records of the Lender shall be conclusive evidence of the principal amount then outstanding hereunder, absent manifest error.

 

The principal amount of this Note at
any time shall be equal to the aggregate amount of all such loans and advances made to Borrower through such time (including advances
to pay interest hereon), less the aggregate amount of all repayments of principal of this Note made by Borrower through such time.

 

    	 	1	 

     

    

 

2.           
Security. As collateral security for the payment and satisfaction of the unpaid principal balance of this Note and
all interest accrued thereon, Borrower hereby grants to Lender a continuing, first-priority security interest in and to all of
the Collateral. The Collateral means each and all of the following:

	 	A.	the Accounts;
	 	 	 
	 	B.	the Equipment;
	 	 	 
	 	C.	the Inventory;
	 	 	 
	 	D.	the General Intangibles;
	 	 	 
	 	E.	the Negotiable Collateral;
	 	 	 
	 	F.	any money, deposit accounts or other assets of Borrower in which Lender receives a security interest or which hereafter come into the possess ion, custody or control of Lender;
	 	 	 
	 	G.	all Supporting Obligations;
	 	 	 
	 	H.	all Investment Property;
	 	 	 
	 	I.	all Letter of Credit Rights; and
	 	 	 
	 	J.	the proceeds of any of the foregoing, including, but not limited to, proceeds of insurance covering the Collateral, or any portion thereof, and any and all Accounts, Equipment, Inventory, General Intangibles, Negotiable Collateral, the Investment Property, the Letter of Credit Rights, the Supporting Obligations, money, deposit accounts or other tangible and intangible property resulting from the sale or other disposition of the Collateral, or any portion thereof or interest therein, and the proceeds thereof.

 

The capitalized terms
used in the definition of the Collateral shall have the meanings ascribed to them under the Uniform Commercial Code as adopted
in the State of North Carolina (the “UCC”).

 

3.            
Representations and Warranties. Borrower hereby represents and warrants to Lender that:

 

(a)         
Borrower (i) is a limited liability company duly organized, validly existing and in good standing under the laws of the
State of North Carolina, (ii) has all requisite limited liability company power and authority to own and operate its property,
to lease the property it operates as lessee and to conduct the business in which it is currently, or is currently proposed to be,
engaged, (iii) is duly qualified as a foreign entity, licensed and in good standing under the laws of each jurisdiction where its
ownership, lease or operation of property or the conduct of its business requires such qualification, except to the extent that
the failure to so qualify would not have a material adverse effect on Borrower, and (iv) has the limited liability company power
and authority to execute, deliver and perform its obligations under this Note and to borrow hereunder;

 

    	 	2	 

     

    

 

(b)         
The execution, delivery and performance by Borrower of this Note (i) has been duly authorized by all necessary action, (ii)
do not and will not contravene or violate the terms of its corporate constitutional documents or any amendment thereto or any law
applicable to Borrower or its assets, business or properties, (iii) do not and will not (1) conflict with, contravene, result
in any violation or breach of or default under any material contractual obligation of Borrower (with or without the giving of notice
or the lapse of time or both), (2) create in any other person a right or claim of termination or amendment of any material contractual
obligation of Borrower, or (3) require modification, acceleration or cancellation of any material contractual obligation of Borrower,
and (iv) do not and will not result in the creation of any lien (or obligation to create a lien) against any property, asset or
business of Borrower; and

 

(c)         
Borrower has duly executed and delivered this Note and this Note constitutes the legal, valid and binding obligations Borrower,
enforceable against Borrower in accordance with the terms hereof, except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors’ rights
and by general principles of equity.

 

4.           
Events of Default. The following shall constitute “Events of Default” with respect to this Note:

 

(a)         
Borrower shall fail to pay the principal of, or interest on, this Note when the same becomes due and payable in accordance
with the terms hereof;

 

(b)         
Any representation or warranty made by Borrower in Section 3 hereof shall fail to be true and correct in all material
respects or Borrower shall default in the performance of any of its obligations under Section 4 hereof; or

 

(c)         
Borrower makes a general assignment for the benefit of its creditors or applies to any tribunal for the appointment of a
trustee or receiver of a substantial part of the assets of Borrower, or commences any proceedings relating to Borrower under any
bankruptcy, reorganization, arrangement, insolvency, readjustment of debts, dissolution or other liquidation law of any jurisdiction;
or any such application is filed, or any such proceedings are commenced against Borrower and Borrower indicates its consent to
such proceedings, or an order or decree is entered by a court of competent jurisdiction appointing such trustee or receiver, or
adjudicating Borrower bankrupt or insolvent, or approving the petition in any such proceedings, and such order or decree remains
unstayed and in effect for ninety (90) days.

 

    	 	3	 

     

    

 

5.           
Consequences of Event of Default. Upon the occurrence of any such Event of Default and during the continuation thereof,
the unpaid principal balance of this Note and accrued and unpaid interest hereon shall become immediately due and payable upon
such occurrence without action by Lender and Lender shall have all other rights and remedies provided by applicable law. Lender
shall have all of the rights and remedies of a secured party under the UCC.

 

6.           
Remedies are Cumulative. No failure on the part of Lender to exercise, and no delay in exercising, any right, power
or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise by Lender or any right, power or
remedy hereunder preclude any other or further exercise thereof or the exercise of any right, power or remedy. The remedies herein
provided are cumulative and are not exclusive of any remedies provided by law, in equity, or in other loan documents.

 

7.           
Costs of Collection. In the event that this Note is not paid when due, Borrower shall also pay or reimburse Lender
for all reasonable costs and expenses of collection, including, without limitation, reasonable attorneys’ fees.

 

8.           
Default Interest Rate. Upon the occurrence of any Event of Default, any principal balance remaining unpaid under
this Note shall bear interest at a rate per annum equal to three percent (3%) above the interest rate otherwise applicable hereto.

 

9.           
Governing Law. This Note shall be governed by and construed in accordance with the laws of the State of North Carolina
without regard to the conflicts of law provisions thereof.

 

10.         
Waiver. Borrower waives presentment for payment, demand, protest, notice of dishonor, notice of protest, diligence
on bringing suit against any party hereto, and all defenses on the ground of any extension of the time of payment that may be given
by Lender to it. Borrower agrees not to assert against Lender as a defense (legal or equitable), as a set-off, as a counterclaim,
or otherwise, any claims Borrower may have against any other party liable to Lender for all or any part of the obligations under
this Note. All rights of Borrower hereunder, and all obligations of Borrower hereunder, shall be absolute and unconditional, not
discharged or impaired irrespective of (and regard less of whether Borrower receives any notice of): (i) any lack of validity or
enforceability of any provision of this Note; (ii) any change in the time, manner or place of payment or performance, or in any
term, of all or any of the obligations hereunder or any other amendment or waiver of or any consent to any departure from any provision
herein; or (iii) any release of or modifications to or insufficiency, unenforceability or enforcement of the obligations of any
guarantor or other obligor. To the extent permitted by law, Borrower hereby waives any rights under any valuation, stay, appraisement,
extension or redemption laws now existing or which may hereafter exist and any other circumstance which might otherwise constitute
a defense available to, or a discharge of any party with respect to the obligations of Borrower hereunder.

 

    	 	4	 

     

    

 

11.         
No Right of Set-Off. As of the date hereof, Borrower represents that it has no claims or offsets against Lender in
breach of contract, breach of warranty, express or implied, negligence or for any other type of legal action under this Note or
otherwise.

 

12.         
Notices. Any notice pursuant to this Note must be in writing and will be deemed effectively given to another patty
on the earliest of the date (a) three (3) business days after such notice is sent by registered U.S. mail, return receipt requested,
(b) one (1) business day after receipt of confirmation if such notice is sent by facsimile, (c) one (1) business day after delivery
of such notice into the custody and control of an overnight courier service for next day delivery, (d) one (1) business day after
delivery of such notice in person and (e) such notice is received by that party; in each case to the appropriate address below
(or to such other address as a party may designate by notice to the other party):

 

If to Borrower:

 

FlexShopper, LLC

2700 N. Military Trail, Suite
200

Boca Raton, FL 33431

Attn: Brad Bernstein

 

If to Lender:

 

Marc Malaga

c/o FlexShopper, LLC

2700 N. Military Trail, Suite
200

Boca Raton, FL 33431

 

13.         
Severability. Any provision of this Note that is determined by any court of competent jurisdiction to be invalid
or unenforceable will not affect the validity or enforceability of any other provision hereof or the invalid or unenforceable provision
in any other situation or in any other jurisdiction. Any provision of this Note held invalid or unenforceable only in part or degree
will remain in full force and effect to the extent not held invalid or unenforceable.

 

14.         
Counterparts. This Note may be executed in counterparts (and by different parties hereto in different counterparts),
each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Note
constitutes the entire contract among the parties relating to the subject matter hereof and supersedes any and all previous agreements
and understandings, oral or written, relating to the subject matter hereof. Delivery of an executed counterpart of a signature
page of this Note by telecopy or other electronic transmission shall be effective as delivery of a manually executed counterpart
of this Note.

 

    	 	5	 

     

    

 

IN WITNESS WHEREOF,
Borrower has caused this Note to be duly executed, and Lender has accepted this Note, as of the day and year first above written. 

 

	 	Borrower:
	 	 	 
	 	FLEXSHOPPER, LLC
	 	 	 
	 	By:	/s/ Brad Bernstein
	 	Name:	Brad Bernstein
	 	Title:	CEO

  

ACCEPTED:

 

Lender:

 

/s/ Marc Malaga

Marc Malaga

 

    	 	6	 

     

    

 

Exhibit
A

Advancement/Payment Schedule

	Date	Amount Advanced	Principal Payment	Principal Balance

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