Document:

Exhibit
10.16

 

AMENDMENT
NO. 3

 

TO

 

AMENDED
AND RESTATED CREDIT AND SECURITY AGREEMENT

 

This
AMENDMENT NO. 3 (this “Amendment”) is entered into as of February 26, 2020, by and among MANHATTAN BRIDGE CAPITAL,
INC., a New York corporation (“Borrower”; and collectively with any Person who is or hereafter becomes a party
to the Credit Agreement (as defined below) as a borrower or a guarantor, each a “Loan Party” and collectively,
the “Loan Parties”), the financial institutions who are or hereafter become parties to the Credit Agreement
(as defined below) as lenders (collectively, the “Lenders” and each individually a “Lender”)
and WEBSTER BUSINESS CREDIT CORPORATION (“WBCC”), individually, as a Lender hereunder and as agent for itself
and each other Lender (WBCC, acting in such agency capacity, the “Agent”).

 

BACKGROUND

 

Loan
Parties, Lenders and Agent are parties to an Amended and Restated Credit and Security Agreement dated as of August 8, 2017 (as
amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”)
pursuant to which Agent and Lenders provide Loan Parties with certain financial accommodations.

 

Loan
Parties have requested that Agent and Lenders make certain amendments to the Credit Agreement, and Agent and Lenders are willing
to do so on the terms and conditions hereafter set forth.

 

Further,
Agent has arranged for MIZRAHI TEFAHOT BANK LTD. (“New Lender”) to assume, and New Lender has agreed to assume,
a portion of the increased Revolving Commitment of Lenders on the terms and conditions hereafter set forth. Accordingly, this
Amendment will further serve as a joinder of New Lender to the Credit Agreement as a Lender thereunder.

 

NOW,
THEREFORE, in consideration of any loan or advance or grant of credit heretofore or hereafter made to or for the account of Borrower
by Lenders, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties
hereto hereby agree as follows:

 

1.
Definitions. All capitalized terms not otherwise defined herein shall have the respective meanings given to them in the
Credit Agreement.

 

    	 		 

    	 

    

 

2.
Amendment to Credit Agreement. Subject to satisfaction of the conditions precedent set forth in Section 4 below, the Credit
Agreement is hereby amended as follows:

 

(a)
Section 14.1 of the Credit Agreement is hereby amended and restated in its entirety to read as follows:

 

14.1
Term; Early Termination Fee. This Agreement, which shall inure to the benefit of and shall be binding upon, the respective
successors and permitted assigns of each Loan Party, Agent and Lenders, shall become effective on the Closing Date and shall continue
in full force and effect until February 28, 2023 (the “Term”) unless sooner terminated as herein provided.
Borrower may terminate this Agreement at any time upon ninety (90) days’ prior written notice upon payment in full of the
Obligations. In the event the Obligations are prepaid in full prior to the last day of the Term (the date of such prepayment hereinafter
referred to as the “Early Termination Date”), Borrower shall pay to Agent, for the ratable benefit of the Lenders,
an early termination fee (the “Early Termination Fee”), for the loss of its bargain (and not as a penalty)
in an amount equal to (i) two percent (2%) of the Maximum Revolving Amount, if the Early Termination Date occurs from the Amendment
No. 3 Effective Date through the first anniversary of the Amendment No. 3 Effective Date, (ii) one percent (1%) of the Maximum
Revolving Amount if the Early Termination Date occurs on the first anniversary of the Amendment No. 3 Effective Date through and
including the second anniversary of the Amendment No. 3 Effective Date, and (iii) one half of one percent (0.50%) of the Maximum
Revolving Amount if the Early Termination Date occurs on the second anniversary of the Amendment No. 3 Effective Date through
and including the date which is six months after the second anniversary of the Amendment No. 3 Effective Date, it being agreed
that in the remaining six months of the Term, no Early Termination Fee will apply.

 

(b)
Annex One – General Definitions of the Credit Agreement is hereby amended by adding the following definitions in their appropriate
alphabetical order to read as follows:

 

“Amendment
No. 3” shall mean that certain Amendment No. 3, dated as of February 26, 2020, to this Agreement.

 

“Amendment
No. 3 Effective Date” shall have the meaning set forth in Section 4 of Amendment No. 3.

 

(c)
Annex One – General Definitions of the Credit Agreement is hereby amended by amending and restating the following definitions
in their entirety to read as follows:

 

“Maximum
Revolving Amount” shall mean the maximum amount of Revolving Advances and Letters of Credit which may be outstanding
at any one time, determined without regard to the Borrowing Base, which as of the Amendment No. 3 Effective Date, equals Thirty
Two Million Five Hundred Thousand Dollars ($32,500,000.00).

 

    	2	 	 

    	 

    

 

“Permitted
Bond Transaction” shall mean the issuance by the Bond Subsidiary of up to $20,000,000 aggregate principal amount
of senior notes pursuant to the Permitted Bond Indenture, of which not more than $10,000,000 of such notes shall be secured
by mortgage notes receivable; provided, however, the terms and conditions of such bonds shall be satisfactory to
Agent in its reasonable discretion.

 

(d)
Schedule 1.1 of the Credit Agreement setting forth each Lender’s Revolving Commitment and Revolving Commitment Percentage
is hereby deleted in its entirety and replaced by “Schedule 1.1” attached hereto. All references to “Schedule
1.1” in the Credit Agreement shall be deemed to mean the Credit Agreement as amended hereby and as may be further amended
from time to time.

 

3.
Joinder of New Lender. By its signature below, New Lender hereby: (a) confirms that it has received a copy of the Credit
Agreement, each amendment thereto and such other documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this joinder; (b) agrees that it will, independently and without reliance upon Agent or any
other Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit
decisions in taking or not taking action under the Credit Agreement or any Other Document; (c) appoints and authorizes Agent to
take such action as agent on its behalf and to exercise such powers and discretion under the Credit Agreement and the Other Documents
as are delegated to Agent by the terms thereof; (d) agrees that it will perform all of the obligations that by the terms of the
Credit Agreement or any Other Document are required to be performed by it as a Lender in accordance with its terms; (e) represents
and warrants that it is either (x) entitled to the benefits of an income tax treaty with the United States that provides for an
exemption from the United States withholding tax on interest and other payments made by Borrower under the Credit Agreement and
the Other Documents or (y) is engaged in trade or business within the United States; and (f) acknowledges that one or more conditions
precedent to the making of any existing Loan may have been waived in connection with any such action and agrees to be bound thereby.
The effective date for New Lender’s joinder pursuant to this Agreement shall be the Amendment No. 3 Effective Date, at which
time New Lender shall be a party to the Credit Agreement (as a Lender) and the Other Documents and have the rights and obligations
of a Lender thereunder.

 

4.
Conditions of Effectiveness. This Amendment shall become effective (such date, the “Amendment No. 3 Effective
Date”) upon Agent’s receipt of:

 

(a)
a copy of this Amendment duly executed and delivered by Agent, Required Lenders, each Loan Party and Personal Guarantor (defined
below) with one original executed copy of this Amendment to be promptly delivered by Loan Parties to Agent, in form and substance
satisfactory to Agent;

 

(b)
an executed Revolving Credit Note, dated of even date herewith, in the principal amount of $7,500,000 issued by Borrower to the
order of New Lender, with one original executed copy to be promptly delivered by Borrower to Agent;

 

    	3	 	 

    	 

    

 

(c)
an executed copy of an Amendment No. 3 Fee Letter, dated of even date herewith, between Borrower and WBCC, in form and substance
satisfactory to WBCC;

 

(d)
a certificate of the Secretary (or Assistant Secretary) of each Loan Party, dated on or around the Amendment No. 3 Effective Date,
in form and substance acceptable to Agent, certifying as to (a) the incumbency and signature of the officers (or other representatives)
of each Loan Party executing this Amendment, (b) the authorizations by the board of directors (or other governing body) of such
Loan Party to such officers or other representatives to enter into and carry out such transactions as are contemplated pursuant
to this Amendment; and including therewith copies of the Organic Documents of such Loan Party as in effect on the Amendment No.
3 Effective Date and good standing certificates for each Loan Party dated not more than thirty (30) days prior to the Amendment
No. 3 Effective Date, issued by the secretary of state or other appropriate official of each Loan Party’s jurisdiction of
organization; and

 

(e)
such other documents, instruments and agreements as Agent or its counsel may require.

 

5.
Representations and Warranties. Each Loan Party hereby represents and warrants as follows:

 

(a)
This Amendment and the Credit Agreement, as amended hereby, constitute legal, valid and binding obligations of each Loan Party
and are enforceable against each Loan Party in accordance with their respective terms.

 

(b)
Upon the effectiveness of this Amendment, each Loan Party hereby reaffirms all covenants, representations and warranties made
in the Credit Agreement as amended hereby and agree that all such covenants, representations and warranties shall be deemed to
have been remade as of the effective date of this Amendment.

 

(c)
After giving effect to this Amendment, no Event of Default or Default has occurred and is continuing or would exist after giving
effect to this Amendment.

 

(d)
No Loan Party has any defense, counterclaim or offset with respect to the Credit Agreement or any Other Document to which it is
a party.

 

6.
Effect on the Credit Agreement.

 

(a)
Upon the effectiveness of this Amendment, each reference in the Credit Agreement to “this Amendment,” “hereunder,”
“hereof,” “herein” or words of like import shall mean and be a reference to the Credit Agreement as amended
hereby. This Amendment shall be an Other Document for all purposes under the Credit Agreement.

 

(b)
Except as specifically amended herein, the Credit Agreement, and all other documents, instruments and agreements executed and/or
delivered in connection therewith, shall remain in full force and effect, and are hereby ratified and confirmed.

 

    	4	 	 

    	 

    

 

(c)
The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of Agent
or any Lender, nor constitute a waiver of any provision of the Credit Agreement, or any other documents, instruments or agreements
executed and/or delivered under or in connection therewith.

 

7.
Release. Each of the Loan Parties on behalf of itself and its successors, assigns, and other legal representatives, and
Personal Guarantor on behalf of himself and his successors, assigns, and other legal representatives, hereby, (a) jointly and
severally, absolutely, unconditionally and irrevocably releases, remises and forever discharges Agent and Lenders, and each of
their present and former shareholders, affiliates, subsidiaries, divisions, predecessors, directors, officers, attorneys, employees,
agents and other representatives and their respective successors and assigns (Agent and Lenders and all such other parties being
hereinafter referred to collectively as the “Releasees” and individually as a “Releasee”),
of and from all demands, actions, causes of action, suits, covenants, contracts, controversies, agreements, promises, sums of
money, accounts, bills, reckonings, damages and any and all other claims, counterclaims, defenses, rights of set-off, demands
and liabilities whatsoever (individually, a “Claim” and collectively, “Claims”) of every name and
nature, known or unknown, suspected or unsuspected, both at law and in equity, whether liquidated or unliquidated, matured or
unmatured, asserted or unasserted, fixed or contingent, foreseen or unforeseen and anticipated or unanticipated, which each of
the Loan Parties and Personal Guarantor, or any of their respective successors, assigns, or other legal representatives and their
successors and assigns may now or hereafter own, hold, have or claim to have against the Releasees or any of them for, upon, or
by reason of any nature, cause or thing whatsoever which arises at any time on or prior to the day and date of this Amendment,
in relation to, or in any way in connection with the Credit Agreement, as amended and supplemented through the date hereof, the
Personal Guaranty, this Amendment, the Other Documents; (b) understands, acknowledges and agrees that the release set forth above
may be pleaded as a full and complete defense and may be used as a basis for an injunction against any action, suit or other proceeding
which may be instituted, prosecuted or attempted in breach of the provisions of such release; (c) agrees that no fact, event,
circumstance, evidence or transaction which could now be asserted or which may hereafter be discovered shall affect in any manner
the final and unconditional nature of the release set forth above and nothing contained herein shall constitute an admission of
liability with respect to any Claim on the part of any Releasee; and (d) jointly and severally, absolutely, unconditionally and
irrevocably, covenants and agrees with each Releasee that it will not sue (at law, in equity, in any regulatory proceeding or
otherwise) any Releasee on the basis of any Claim released, remised and discharged by any of the Loan Parties or Personal Guarantor
pursuant to this Paragraph 7. If any Loan Party or Personal Guarantor violates the foregoing covenant, Loan Parties and Personal
Guarantor, jointly and severally, agree to pay, in addition to such other damages as any Releasee may sustain as a result of such
violation, all attorneys’ fees and costs incurred by any Releasee as a result of such violation.

 

8.
Governing Law. This Amendment shall be binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns and shall be governed by and construed in accordance with the laws of the State of New York.

 

    	5	 	 

    	 

    

 

9.
Headings. Section headings in this Amendment are included herein for convenience of reference only and shall not constitute
a part of this Amendment for any other purpose.

 

10.
Counterparts; Facsimile. This Amendment may be executed by the parties hereto in one or more counterparts, each of which
shall be deemed an original and all of which when taken together shall constitute one and the same agreement. Any signature delivered
by a party by .pdf or electronic transmission shall be deemed to be an original signature hereto.

 

11.
Personal Guarantor. Assaf Ran (the “Personal Guarantor”) hereby ratifies and confirms that all of the
terms and conditions, representations and covenants contained in the Amended and Restated Guaranty Agreement (as amended, the
“Guaranty”), dated as of August 8, 2017, made by Personal Guarantor in favor of Agent remain in full force
and effect after giving effect to the execution and effectiveness of this Agreement and the increase of the Maximum Revolving
Amount pursuant hereto, and Personal Guarantor hereby reaffirms that all of the Obligations of Loan Parties under the Credit Agreement
as amended by this Agreement (including, without limitation, obligations relating to the increased Maximum Revolving Amount) are
irrevocably guaranteed by such Personal Guarantor in accordance with the terms and conditions of the Guaranty.

 

12.
Severability. In case of one or more of the provisions contained in this Amendment shall be held invalid, illegal or unenforceable
in any respect, the validity, legality and enforceability of the remaining provisions contained herein shall not in any way be
affected or impaired thereby.

 

[Remainder
of page intentionally left blank; signature pages follow]

 

    	6	 	 

    	 

    

 

IN
WITNESS WHEREOF, this Amendment has been duly executed as of the day and year first written above.

 

	 	BORROWER:
	 	MANHATTAN
    BRIDGE CAPITAL, INC.
	 	 	 
	 	By:	/s/
    Assaf Ran
	 	Name:	Assaf
    Ran
	 	Title:	CEO
	 	 	 
	 	PERSONAL
    GUARANTOR:
	 	 
	 	 	/s/
    Assaf Ran
	 	 	ASSAF
    RAN

 

[Signature
Page to Amendment No. 3]

 

    	 		 

    	 

    

 

	 	WEBSTER
    BUSINESS CREDIT

    CORPORATION, as Agent and a Lender
	 	 	 
	 	By:	/s/
    Leo Goldstein
	 	Name:	Leo
    Goldstein
	 	Title:	Vice
    President

 

[Signature
Page to Amendment No. 3]

 

    	 		 

    	 

    

 

	 	FLUSHING
    BANK, as a Lender
	 	 	 
	 	By:	/s/
    Lisa J. Arching
	 	Name:	Lisa
    J. Arching
	 	Title:	VP,
    Senior Credit Relationship Manager

 

[Signature
Page to Amendment No. 3]

 

    	 		 

    	 

    

 

	 	MIZRAHI
        TEFAHOT BANK LTD., as New Lender

        

	 	 	 
	 	By:	/s/ Nguyen
    Phung
	 	Name:	Nguyen
    Phung    
	 	Title:	 

 

[Signature
Page to Amendment No. 3]

 

    	 		 

    	 

    

 

Schedule
1.1

	Lender Party	 	Revolving Commitment	 	 	Revolving Commitment Percentage	 
	WBCC
  
 Address:
  
 360 Lexington Avenue
 New York, New York 10017
 Attention: Account Executive – Manhattan Bridge Capital, Inc.
	 	$	15,000,000	 	 	 	46.1538	%
	 	 	 	 	 	 	 	 	 
	Flushing Bank
  
 Address:
  
 Flushing Bank
 220 RXR Plaza
 Uniondale, NY 11556
 Attn: Lisa Archinow, Vice President
	 	$	10,000,000	 	 	 	30.7692	%
	 	 	 	 	 	 	 	 	 
	Mizrahi Tefahot Bank Ltd. 
  
Address: 
  
800 Wilshire Blvd., Suite 1410
 Los Angeles, CA 90017
 Attn: Gerry Perez, Senior Vice President	 	$	7,500,000	 	 	 	23.0769	%
	 	 	 	 	 	 	 	 	 
	Total:	 	$	32,500,000	 	 	 	100	%

 

    	Schedule 1.1Exhibit
10.17

 

REVOLVING
CREDIT NOTE

 

	$7,500,000	February
    25, 2020
	 	New
    York, New York

 

FOR
VALUE RECEIVED, the undersigned (“Borrower”), promises to pay to the order of MIZRAHI TEFAHOT BANK LTD. (“Payee”;
Payee, together with any other holder hereof, sometimes referred to herein as the “Holder”), at the office of Agent
(defined below) located at 360 Lexington Avenue, New York, New York 10017 or at such other place as Payee may from time to time
designate to Borrower in writing, the principal sum of SEVEN MILLION FIVE HUNDRED THOUSAND AND 00/100 DOLLARS ($7,500,000), or
such lesser amount as may be outstanding under Revolving Advances made pursuant to the Credit Agreement (defined below), at such
time or times as are provided in the Credit Agreement (defined below) and, in any event, on the last day of the Term, subject
to acceleration upon the occurrence of an Event of Default under the Credit Agreement or earlier termination of the Credit Agreement
pursuant to the terms thereof, together with interest on the unpaid principal balance hereof from the date hereof until the payment
in full of this Revolving Credit Note (this “Note”) at the rate specified with respect to the Revolving Advances in
the Credit Agreement, payable at the times and in the manner provided in the Credit Agreement.

 

It
is contemplated that the principal sum evidenced hereby may be reduced from time to time as a result of the repayment of Revolving
Advances and that additional Revolving Advances may be made from time to time but not to exceed the Maximum Revolving Amount,
as provided in the Credit Agreement.

 

This
Note is one of the “Revolving Credit Notes” issued to evidence the Revolving Advances being made available by Payee
to Borrower pursuant to the provisions of the Amended and Restated Credit and Security Agreement, dated as August 8, 2017 (herein,
as at any time amended, modified or supplemented, called the “Credit Agreement”; capitalized terms used herein and
not defined herein having the meanings assigned to them in the Credit Agreement), among the Borrower, the other Loan Parties identified
therein, the financial institutions identified therein (each a “Lender” and collectively, the “Lenders”)
and Webster Business Credit Corporation (“WBCC”) as a Lender and agent for all other Lenders (WBCC, in such capacity,
“Agent”) to which reference is hereby made for a statement of the terms, conditions and covenants under which the
indebtedness evidenced hereby was made and is to be repaid, including, but not limited to, those related to voluntary or mandatory
prepayment of the indebtedness represented hereby, to the maturity of the indebtedness represented hereby upon the termination
of the Credit Agreement and to the interest rate payable hereunder. In no event, however, shall interest exceed the maximum interest
rate permitted by law. Upon and after the occurrence of an Event of Default, and during the continuation thereof, interest shall
be payable at the Default Rate.

 

Payment
of this Note is secured by the Collateral and Holder is entitled to the benefit of the Credit Agreement and any Other Document
at any time delivered in connection with the foregoing to secure the Obligations, and is subject to all of the agreements, terms
and conditions therein contained.

 

    	 

    	 

    

 

If
an Event of Default under Sections 11.7, 11.8 or 11.9 of the Credit Agreement shall occur, then this Note shall immediately become
due and payable, without notice, together with reasonable attorneys’ fees if the collection hereof is placed in the hands
of an attorney to obtain or enforce payment hereof. If any other Event of Default shall occur under the Credit Agreement or any
of the Other Documents, which is not cured within any applicable grace period, then this Note may, as provided in the Credit Agreement,
be declared to be immediately due and payable, without notice, together with reasonable attorneys’ fees, if the collection
hereof is placed in the hands of an attorney to obtain or enforce payment hereof.

 

PURSUANT
TO SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW, THIS NOTE SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED
IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES.

 

Borrower
hereby waives presentment, demand for payment, protest and notice of protest, notice of dishonor and all other notices in connection
with this Note.

 

    	2

    	 

    

 

WITNESS
THE DUE EXECUTION HEREOF BY THE DULY AUTHORIZED OFFICER OF THE UNDERSIGNED AS OF THE DATE FIRST ABOVE WRITTEN.

 

	 	“BORROWER”
	 	 	 
	 	MANHATTAN
    BRIDGE CAPITAL, INC.
	 	 	 
	 	By:	/s/
    Assaf Ran
	 	Name:	Assaf
    Ran
	 	Title:	CEO

 

[Signature
Page to Revolving Credit Note – Mizrahi]

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