Document:

Exhibit 10.5.1

 

AMENDMENT
TO SENIOR MANAGEMENT AGREEMENT

 

This AMENDMENT TO SENIOR MANAGEMENT AGREEMENT is dated
as of June 29, 2004 (this “Amendment”), by and among VeriFone
Holdings, Inc., a Delaware corporation (the “Company”), VeriFone, Inc.,
a Delaware corporation (the “Employer”) and Douglas G. Bergeron (the “Executive”).

 

RECITALS

 

WHEREAS, the Company and the Executive are parties to
a Senior Management Agreement dated as of July 1, 2002 (the “Agreement”);

 

WHEREAS, pursuant to the Agreement, Executive
purchased 3,910,427.805 shares of Carried Common (as defined in the Agreement,
and as adjusted for a stock split), 20% of which vest on each July 1
beginning on July 1, 2003;

 

WHEREAS, as of the date hereof, 20% of Executive’s
Carried Common, or 782,085.561 shares are Vested Shares (as defined in the
Agreement), and 3,128,342.244 are Unvested Shares (as defined in the
Agreement);

 

WHEREAS, the Company is considering a refinancing
transaction in which the Company may pay a dividend in respect of its shares of
common stock, including the Vested Shares and Unvested Shares;

 

WHEREAS, in consideration of a Company decision to
issue one or more dividends during the period that Executive holds Unvested
Shares, Executive is willing to agree to repay such dividends with respect to
his Unvested shares in the event of his termination of employment as set forth
herein;

 

WHEREAS, the Company, Employer and Executive wish to
amend the Agreement to provide for a return of a portion of any dividend paid
to Executive in respect of any Unvested Shares in the event of a Executive’s
voluntary resignation of his employment with the Company, Employer and their
subsidiaries (a “Dividend Repayment Trigger”); and

 

WHEREAS, for purposes of absolutely clarity, it is
understood that the Dividend Repayment Trigger shall not be invoked upon any
other event, including Executive’s death or Disability, termination without
Cause, termination with Cause, or termination for Good Reason.

 

NOW, THEREFORE, for good and valuable consideration,
the parties agree as follows:

 

1.                                       Definitions.  Any capitalized term used but not defined
herein shall have the meaning set forth in the Agreement.

 

2.                                       Repayment
of Dividend.  If (i) at any time the
Company pays a cash dividend in respect of its common stock, including in
respect of any Unvested Shares, prior to the occurrence of a Dividend Repayment
Trigger, and (ii) the Dividend Repayment Trigger occurs prior to the date that
100% of the Carried Common vests in accordance with Section 2(a) of
the Agreement, then Executive hereby agrees to repay the Company an amount (the
“Repayment Amount”) equal

 

 

to (X) a fraction equal to (1) one minus (2) Executive’s combined
federal, state and local marginal tax rate paid on all dividends received by
Executive, multiplied by an amount equal to (a) the total amount of all
dividend proceeds received by Executive with respect to Executive’s Carried
Common prior to the date of the Dividend Repayment Trigger multiplied by (b) a
fraction, the numerator of which is the total number of Unvested Shares as of
the date of the Dividend Repayment Trigger and the denominator of which is the
total number of shares of Carried Common. 
Except as set forth in Section 3 below, the full Repayment
Amount shall be due and payable within 5 days of the Dividend Repayment
Trigger, and shall be paid by check or wire transfer of funds and/or by offset
against bona fide amounts owed by the Company, Employer or one of their
subsidiaries to Executive.

 

3.                                       Repurchase
Option.  Executive and the Company agree
that, prior to and in lieu of receiving the full Repayment Amount within 5 days
of the Dividend Repayment Trigger, the Company may notify Executive that it has
elected to apply all or any portion of the Repayment Amount to the purchase
price for the Repurchase Option pursuant to Section 3(e) of the
Agreement.  Nothing in this Section 3
shall modify or amend the terms and conditions of the Repurchase Option, or
modify, reduce or diminish Executive’s obligation to pay the full amount of the
Repayment Amount, it being understood that if the Company later elects not to
exercise its Repurchase Option or to exercise it only in part, then Executive
shall, on demand, pay the Company all of any of the unsatisfied Repayment
Amount by check or wire transfer of funds.

 

4.                                       Miscellaneous.

 

(a)                                  Survival
of Other Provisions.  Unless
specifically amended herein, all of the other covenants, agreements,
representations, warranties, promises or other terms and conditions of the
Agreement shall remain in full force and effect without any change whatsoever.

 

(b)                                 Entire
Agreement.  This Amendment and the
Agreement constitutes the full and entire understanding and agreement of the
parties with respect to the subject matter hereof, and there are no further or
other agreements or undertakings, written or oral, in effect between the
parties relating to the subject matter hereof unless expressly referred to in
this Amendment or the Agreement.

 

(c)                                  Execution
in Counterparts.  This Amendment may
be executed in any number of counterparts and in separate counterparts, each of
which when so executed and delivered shall be deemed to be an original and all
of which taken together shall constitute one and the same instrument.

 

*                                         *                                         *                                         *

 

2

 

IN WITNESS WHEREOF, the Parties have signed this
Amendment as of the date set forth in the first paragraph of this Amendment.

 

	
   

  	
  VERIFONE HOLDINGS, INC.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Douglas G. Bergeron

  
	
   

  	
   

  	
  Douglas G. Bergeron

  
	
   

  	
  Its:

  	
  Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  VERIFONE, INC.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Douglas G. Bergeron

  
	
   

  	
   

  	
  Douglas G. Bergeron

  
	
   

  	
  Its:

  	
  Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  /s/ Douglas G. Bergeron

  
	
   

  	
  Douglas G. Bergeron

  	
   

  
				

 

 

	
  Agreed and Accepted:

  
	
   

  
	
  GTCR FUND VII, L.P.

  
	
   

  	
   

  
	
  By:

  	
  GTCR Partners VII, L.P.

  
	
  Its:

  	
  General Partner

  
	
   

  	
   

  
	
  By:

  	
  GTCR Golder Rauner, L.L.C.

  
	
  Its:

  	
  General Partner

  
	
   

  	
   

  
	
  By:

  	
  /s/ Collin E. Roche

  	
   

  
	
   

  	
  Collin E. Roche, its Principal

  
	
   

  	
   

  
	
  GTCR CO-INVEST, L.P.

  
	
   

  	
   

  
	
  By:

  	
  GTCR Golder Rauner, L.L.C.

  
	
  Its:

  	
  General Partner

  
	
   

  	
   

  
	
  By:

  	
  /s/ Collin E. Roche

  	
   

  
	
   

  	
  Collin E. Roche, its Principal

  

 

3Exhibit 10.9.1

 

FIRST AMENDMENT TO CREDIT AGREEMENT

 

FIRST AMENDMENT dated as of March 23, 2005 (this “First
Amendment”) among VERIFONE INTERMEDIATE HOLDINGS, INC., a Delaware
corporation (“Holdings”), VERIFONE, INC., a Delaware corporation (the “Borrower”),
the Lenders signatory hereto, BANK OF AMERICA, N.A., as Administrative Agent
for the Lenders (in such capacity, the “Administrative Agent”).

 

Holdings, the Borrower, the lenders party thereto from time (each a “Lender”
and, collectively, the “Lenders”), the Administrative Agent, Credit
Suisse First Boston, Cayman Islands Branch, as Syndication Agent, and Wells
Fargo Bank, N.A., as Documentation Agent, are parties to a Credit Agreement
dated as of June 30, 2004 (the “Credit Agreement”). Holdings and
the Borrower have requested that the Lenders agree to certain amendments to the
Credit Agreement, and each of the Lenders signatory hereto (which Lenders
collectively constitute the Required Lenders referred to in the Credit
Agreement), have agreed, subject to the terms and conditions set forth herein,
to amend the Credit Agreement as herein provided. Accordingly, Holdings, the
Borrower and the Lenders signatory hereto agree as follows:

 

ARTICLE I

DEFINITIONS

 

Section 1.01  Definitions. Unless otherwise defined herein,
capitalized terms defined in the Credit Agreement have the same meanings when
used in this First Amendment.  The
following additional terms, as used herein, have the following respective
meanings:

 

“Consenting Lender” means each Senior Lender that consents to
this First Amendment on or prior to March 18, 2005, as evidenced by the
receipt by Fried, Frank, Harris, Shriver & Jacobs LLP, counsel to the
Administrative Agent, of an executed counterpart signature page to this First
Amendment from such Lender prior to 5:00 P.M. (local time in New York City) on March 18,
2005.

 

ARTICLE II

AMENDMENTS TO THE CREDIT AGREEMENT

 

Section 2.01  Amendments to Article I of the Credit
Agreement.

 

(a)                                  The following definitions are added to Section 1.01
of the Credit Agreement in the appropriate alphabetical order:

 

“Additional Term B Commitment” means, with respect to any
Lender, the commitment of such Lender to make an Additional Term B Loan on the
First Amendment Effective Date in a principal amount equal to the amount set
forth opposite such Lender’s name on Schedule I to the First Amendment in
the column captioned “Additional Term B Commitment”.

 

“Additional Term B Lender” means each bank or other lending
institution identified on Schedule I to the First Amendment as having an
Additional Term B Commitment and its successors.

 

“Additional Term B Loan” has the meaning specified in Section 2.01(e)(i).

 

“Assignee Group”
means two or more Eligible Assignees that are Affiliates of one another or two
or more Approved Funds managed by the same investment advisor.

 

 

“Consenting Term B Lender” means each Term B Lender that has (i)
executed and delivered a counterpart of the First Amendment to the
Administrative Agent on or prior to 5:00 P.M. (New York time) on March 18,
2005 and (ii) specifically notified the Administrative Agent of its desire to
convert its Term B Loans into Converted Term B Loans pursuant to Section 2.01(e)(i).

 

“Conversion Commitment” means, with respect to any Consenting
Term B Lender, the commitment of such Lender to convert the Converted Term B
Loan Amount of the Term B Loans of such Lender which are outstanding
immediately prior to the First Amendment Effective Date into Converted Term B
Loans on the First Amendment Effective Date.

 

“Converted Term B Loan Amount” means, with respect to each
Consenting Term B Lender, the amount set forth opposite such Lender’s name on Schedule 1
to the First Amendment in the column entitled “Converted Term B Loan Amount”.

 

“Converted Term B
Loans” has the meaning specified in Section 2.01(e)(i).

 

“DRC” means Duff & Phelps Credit Rating Co., and its
successors.

 

“First Amendment” means Amendment No. 1 dated as of March 23,
2005 to the Agreement among Holdings, the Borrower, the Required Lenders and
the Administrative Agent.

 

“First Amendment
Effective Date” means the meaning specified in the First Amendment.

 

“Fitch” means Fitch IBCA, Inc., and its successors.

 

“Non-Consenting Term B Lender” means each Term B Lender that is
not a Consenting Term B Lender.

 

“Term B Conversion” has the meaning set forth in Section 2.01(e)(i).”

 

(b)                                 The
definition of “Applicable Margin” is hereby amended:  (i) by amending clause (i) to read as
follows “(i) with respect to Term B Loans, (A) prior to the First Amendment
Effective Date, 2.50% per annum for Eurodollar Loans and 1.50% per annum for
Base Rate Loans, and (B) on and after the First Amendment Effective Date, (x)
if the Minimum Ratings Condition is satisfied, 1.75% for Eurodollar Loans and
0.75% for Base Rate Loans or (y) if the Minimum Ratings Condition is not
satisfied, 2.00% per annum for Eurodollar Loans and 1.00% per annum for Base
Rate Loans,”; (ii) by amending the first sentence of the first paragraph after
the table therein to add “referred to in clause (iii) above” after “Each
Applicable Margin” appearing therein; (iii) by amending the second sentence of
the first paragraph after the table therein to add “referred to in this
paragraph” after “Each Applicable Margin” appearing therein; (iv) by amending
the last sentence of the first paragraph after the table therein to replace “the”
appearing therein with “such”; and (v) by adding the following new paragraph
after the table therein:

 

“As used in clause
(i) above, the term “Minimum Ratings Condition” means, on any date on or after
the First Amendment Effective Date, that the ratings assigned to the Term B
Loans by either of Moody’s and S&P are Ba3 and BB-, respectively, or higher
(in each case with at least stable outlook). 
If the ratings assigned to the Term B Loans by either or both of Moody’s
and S&P shall be changed after the First Amendment Effective Date (other
than as a result of a change in their respective ratings systems), such change
shall be effective as of the date on which it is first announced by the
applicable rating agency, irrespective of when notice of such change shall have
been furnished by the

 

2

 

Borrower to the
Administrative Agent.  Each change in the
Applicable Margin on the Term B Loans shall apply during the period commencing
on the effective date of such change and ending on the date immediately
preceding the effective date of the next such change. If the rating system of
Moody’s or S&P shall change, or if either such rating agency (including any
successor to its rating agency business) shall cease to be in the business of
rating corporate debt obligations, the Borrower and the Term B Lenders shall
negotiate in good faith to amend this definition to reflect such changed rating
system or the unavailability of ratings from such rating agency and, pending
the effectiveness of any such amendment, the Applicable Margin for New Term
Loans shall be determined using the Moody’s or S&P rating, as the case may
be, most recently in effect prior to such change or cessation.”

 

(c)                                  The
definition of “Cash Equivalents” is hereby amended: (i) by replacing the
words “three months” appearing in clause (i) thereof with the following:
“one year”; (ii) by adding the following prior to the word “S&P” appearing
in clause (ii) thereof” “(w)”; (iii) by replacing the words “or from”
appearing in clause (ii) thereof with the following: “(x)”; (iv) by
adding the following prior to the parenthetical appearing in clause (ii)
thereof: “, (y) DRC is at least D-1 or the equivalent thereof, or (z) Fitch is
at least F1 or the equivalent thereof”; (v) by replacing the words “90 days”
appearing in clause (ii) thereof with the following: “one year”; (vi) by
adding the following prior to the word “A-1” appearing in clause (iii)
thereof: “(w)”; (vii) by replacing the word “or” appearing therein after the
word “S&P” appearing in clause (iii) thereof with the following: “,
(x)”; (viii) by adding the following after the word “Moody’s” appearing in clause
(iii) thereof: “, (y) D-1 (or the equivalent thereof) or better by DRC, or
(z) F1 (or the equivalent thereof) or better by Fitch,”; (ix) by replacing the
words “three months” appearing therein with the following: “270 days”; (x) by
replacing the words “seven days” appearing in clause (iv) thereof with
the following: “one year”; (xi) by deleting the word “and” appearing at the end
of clause (iv); (xii) by replacing the period appearing at the end of clause
(v) thereof with the following: “; and”; (xiii) by adding the following new
clause (vi):

 

“(vi)                        auction rate securities, corporate bonds,
taxable municipal bonds, tax-exempt municipal bonds and money market funds, in
each case, having a maturity within one year of the date of acquisition
thereof, so long as such investments are rated at least AAA or the functional
equivalent by at least two of the following: (A) S&P, (B) Moody’s, (C) DRC,
and (D) Fitch.”

 

(d)                                 The
definition of “Excluded IPO Proceeds” is hereby amended to read in full
as follows:

 

““Excluded IPO Proceeds” means Net Cash Proceeds from
a Qualifying IPO (determined without reference to the minimum amount specified
in clause (ii) of the definition thereof) remaining after a portion of
such Net Cash Proceeds shall have been applied concurrently to repay in full
the outstanding principal amount of the Second Lien Loans pursuant to Section 2.09(b)(vii)(C)
if, at the time of determination, no Event of Default then exists with respect
to the Senior Credit Obligations.”

 

(e)                                  The
definition of “Foreign IP Holdco” is hereby amended by adding “,
Singapore” immediately after the phrase “The Cayman Islands”.

 

(f)                                    The
definition of “Foreign IP Transfer Transaction” is hereby amended: (i)
by deleting in each of clauses (iii)(B) (x) and (y) thereof the phrase “an
exclusive (subject to existing licenses granted) license” and by inserting in
lieu thereof the phrase “a license (subject to existing licenses granted)”;
(ii) by deleting in clause (iii)(B)(z) the word “non-exclusive” and
substituting in lieu thereof

 

3

 

the word
“license”; (iii) by deleting the word “and” immediately before clause (iv)
thereof; (iv) by deleting the word “non-exclusive” in clause (iv)
thereof; and (v) by inserting at the end of clause (iv) thereof and
before the period the phrase “and (v) an assignment by the Borrower of non-U.S.
customer contracts or contracts with non-U.S. divisions of U.S. companies”.

 

(g)                                 The
definition of “Permitted Business Acquisition” is hereby amended: (i) by
deleting clause (vii) thereof; (ii) by inserting a period at the end of
clause (vi) in lieu of the “; and”; and (iii) by amending clause (v) to
read in full as follows:

 

“(v)                           no Event of Default shall have occurred
and be continuing immediately before or immediately after giving effect to such
acquisition, and the Borrower shall have delivered to the Administrative Agent
a Pro-Forma Compliance Certificate demonstrating that, upon giving effect to
such acquisition on a Pro-Forma Basis, the Borrower shall be in compliance with
(A) the Fixed Charge Coverage Ratio specified in Section 7.17(d)
hereof and (B) each of the Senior Secured Leverage Ratio and the Leverage Ratio
specified in Section 7.17(a) and (b), respectively, in each
case (x) as of the last day of the most recent period of four consecutive
fiscal quarters of the Borrower which precedes or ends on the date of such
acquisition and (y) in the case of the Senior Secured Leverage Ratio and the
Leverage Ratio, after computing the maximum permitted ratio for any period by
subtracting .25 from the applicable maximum ratio specified therein for such
period; and”

 

(h)                                 The
definition of “Senior Lender” is hereby amended:  (i) by replacing the comma appearing after “Revolving
Commitment” appearing with “or”; (ii) by replacing the “or” following “Swing
Line Commitment” with “, each bank or other lending institution having”

 

(i)                                     The
definition of “Term B Commitment” is hereby amended to read in full is
follows:

 

““Term B Commitment” means, with respect to any
Lender, as applicable, (i) prior to the First Amendment Effective Date, the
commitment of such Lender to make a Term B Loan on the Closing Date in a
principal amount equal to such Lender’s Term B Commitment Percentage of the
Term B Committed Amount, (ii) on the First Amendment Effective Date, its
Conversion Commitment and/or its Additional Term B Commitment and (iii) any
commitment of such Lender that is included as part of a Facilities Increase to
make Term B Loans on any Facilities Increase Date.”

 

(j)                                     The
definition of “Term B Commitment Percentage” is hereby amended to read
in full is follows:

 

““Term B Commitment Percentage” means, for each Lender, (i)
prior to the First Amendment Effective Date the percentage (carried out to the
ninth decimal place) identified as its Term B Commitment Percentage on Schedule 2.01
or (ii) on and after the First Amendment Effective Date, the percentage
(carried out to the ninth decimal place) (A) identified pertinent to its
Conversion Commitment Percentage on Schedule I to the First Amendment
and/or (B) identified pertinent to its Additional Term B Commitment Percentage
on Schedule I to the First Amendment, in each case as such percentage may
be adjusted pursuant to Section 2.10 or modified in connection with
any assignment made in accordance with the provisions of Section 10.07(b).”

 

(k)                                  The definition of “Term B Lender” is hereby
amended to read in full is follows:

 

4

 

““Term B Lender”
means (i) prior to the First Amendment Effective Date, each bank or other
lending institution identified on Schedule 2.01 as having a Term B
Commitment, (ii) on and after the First Amendment Effective Date, each
Converting Term B Lender and each Additional Term B Lender and (iii) each
Eligible Assignee which acquires a Term B Loan pursuant to Section 10.07(b)
and their respective successors.”

 

(l)                                     The definition of “Term B Loan” is hereby amended to read in full is follows:

 

““Term B Loan”
means (i) prior to the First Amendment Effective Date, a Loan made under Section 2.01(b)
or (ii) on and after the First Amendment Effective Date, a Converted Term B
Loan or an Additional Term B Loan, and “Term B Loans” means two or more
of them, collectively.”

 

(m)                               The definition of “Term
B Note” is hereby amended to add “dated as of the date of issue and” after “means
a promissory note,” appearing therein.

 

(n)                                 Section 1.03 of the
Credit Agreement is hereby amended:  (i) by adding
the following before the end of the first sentence thereof “; provided
that the term “Borrowing” shall include the simultaneous conversion of
Term B Loans and the incurrence of Additional Term B Loans on the First
Amendment Effective Date on the terms provided in Section 2.01(e)”;
and (ii) by replacing the “and” appearing in clause (ii) thereof after “Revolving
Loans” with “or”.

 

Section 2.02  Amendment to Article II of the Credit
Agreement.

 

(a)                                  Section 2.01(b) of the Credit Agreement is hereby
amended by adding “on the Closing Date” to the second sentence thereof after “The
Term B Borrowing”. 

 

(b)                                 Section 2.01 of the Credit Agreement is hereby
amended by adding the following new paragraph (e):

 

“(e)         First Amendment Effective Date Transactions.

 

(i)            Subject to the
terms and conditions set forth herein, (i) each Consenting Term B Lender
severally agrees to convert (the “Term B Conversion”), on the First Amendment
Effective Date, the Term B Loans of such Consenting Term B Lender outstanding
on the First Amendment Effective Date (immediately prior to giving effect
thereto) in an aggregate principal amount equal to its respective Converted
Term B Loan Amount into new Term B Loans hereunder owing by the Borrower (each
such Term B Loan, a “Converted Term B Loan” and, collectively, the “Converted
Term B Loans”) and (ii) each Additional Term B Lender severally agrees,
ratably in the proportion that its Additional Term B Commitment bears to the
aggregate Additional Term B Commitments, to make, on the First Amendment
Effective Date but immediately after the Term B Conversion, a single Term B
Loan (each, an “Additional Term B Loan” and collectively, the “Additional
Term B Loans”) to the Borrower in a principal amount not exceeding its
Additional Term B Commitment.  The
Additional Term B Commitments are not revolving in nature, and any Term B Loans
repaid or prepaid prior to the Term B Maturity Date may not be reborrowed.

 

(ii)                                  In connection with the Term B Conversion
and the incurrence of Additional Term B Loans pursuant to Section 2.01(e)(i),
the Lenders and the Borrower

 

5

 

hereby agree that,
notwithstanding anything to the contrary contained in this Agreement, the
Borrower shall be obligated to pay each Term B Lender, promptly upon its
request (which request shall set forth in reasonable detail the basis for
requesting such compensation), for all losses, expenses and liabilities of the
type referred to in Section 3.05 (including without limitation, any
loss, expense or liability incurred by reason of the liquidation or
reemployment of deposits or other funds required by such Lender to fund its
Term B Loans) which such Lender may sustain in connection with the Term B
Conversion.  Each Lender’s basis for
requesting compensation pursuant to this Section 2.01(e)(ii) shall
be made in good faith.  A Lender’s basis
for requesting compensation pursuant to this Section 2.01(e)(ii) and
a Lender’s calculation of the amount thereof, shall, absent manifest error, be
final and conclusive and binding on all parties hereto.

 

(iii)                               After the First Amendment Effective Date,
each Consenting Term B Lender which holds a Term B Note issued prior to the
First Amendment Effective Date and has not requested and received a replacement
Term B Note on the First Amendment Effective Date shall be entitled to
surrender such Term B Note to the Borrower against delivery of a replacement
Term B Note completed in conformity with Section 2.04(d); provided
that if any such Term B Note is not so surrendered, then from and after the
First Amendment Effective Date such Term B Note shall be deemed to evidence the
Converted Term B Loans into which the Term B Loans previously evidenced by such
Term B Note have been converted.”

 

(c)                                  Section 2.04(d) of the Credit Agreement is hereby
amended:  (i) by replacing “Term B,”
appearing therein with “Term B Loans”; and (ii) by replacing “Exhibit B-6”
appearing therein with “Exhibit B-4”.

 

(d)                                 Section 2.09(a) of the Credit Agreement is hereby
amended by adding the following after “Subject to the foregoing” in the second
sentence thereof:  “and to Section 5.18”.

 

(e)                                  Section 2.09(b)(v) of the Credit Agreement is hereby
amended to read in full as follows:

 

“(v)                           Equity Issuances. Within five Business Days after receipt
by any Group Company of Net Cash Proceeds from any Equity Issuance (other than
in respect of any Excluded Equity Issuance and any Excluded IPO Proceeds), the
Borrower shall prepay the Senior Loans and/or Cash Collateralize the L/C
Obligations in an aggregate amount equal to 50% of the Net Cash Proceeds of
such Equity Issuance.  Within five
Business Days after receipt by any Group Company of any Net Cash Proceeds from
a Qualifying IPO (determined without reference to the minimum amount specified
in clause (ii) of the definition thereof), the Borrower shall prepay the
aggregate unpaid principal amount of all Second Lien Loans.”

 

(f)                                    Section 2.10(a) of the Credit Agreement is hereby
amended:  (i) by deleting “additional”
appearing therein; and (ii) by replacing “Facility” appearing therein with “Commitments”.

 

(g)                                 Section 2.10(d) of the Credit Agreement is hereby
amended by adding the following as a new sentence to the end thereof:

 

“The Term B Commitments of the Lenders shall terminate
automatically immediately after the making of the Term B Loans on the
First Amendment Effective Date, subject to a subsequent Facilities Increase
pursuant to paragraph (a) above.”

 

6

 

(h)                                 Section 2.12(a) of the Credit Agreement is hereby
amended by adding “, Additional Term B Commitment Percentages” after “Term B
Commitment Percentages” appearing therein.

 

Section 2.03  Amendment to Article V of the Credit
Agreement. Section 5.18
of the Credit Agreement is hereby amended by inserting the following sentence
as a new sentence at the end thereof:

 

“The proceeds of
the Additional Term B Loans made on the First Amendment Effective Date will be
used on the First Amendment Effective Date solely to prepay in full the
principal amount of all then outstanding Term B Loans of all Non-Consenting
Term B Lenders.”

 

Section 2.04  Amendment to Article VII of the
Credit Agreement.

 

(a)                                  Section 7.03 of the Credit Agreement is hereby
amended to read in its entirety as follows:

 

“Section 7.03. 
Nature of Business. None of the Group Companies taken as a whole
will alter in any material respect the character or conduct of the business
conducted by the Group Companies as of the Closing Date and activities directly
related thereto and similar, complimentary or related businesses.”

 

(b)                                 Section 7.06(a)(ii) of the Credit Agreement is hereby
amended by adding the following before the end thereof:

 

“;
provided that such Cash Equivalents shall not exceed as to any
concentration limits, the respective amounts established from time to time by
the Company and disclosed to the Administrative Agent”.

 

(c)                                  Section 7.06(a)(xvi) of the Credit Agreement is hereby
amended: (i) by inserting the word “more” immediately prior to the word “Foreign”
as it first appears therein; (ii) by inserting a comma in lieu of the word “or”
immediately before clause (B) thereof; and (iii) by inserting the following
phrase immediately before the semi-colon at the end of clause (B): “or (C)
consisting of converting a previous debt claim against a Foreign Subsidiary in
exchange for Equity Interests in such Foreign Subsidiary”.

 

(d)                                 Section 7.06(b)(i) of the Credit Agreement is hereby
amended to read in its entirety as follows: “written notice thereof is given to
the Administrative Agent not later than 60 days after such establishment,
creation or acquisition,”.

 

(e)                                  Section 7.08(b) of the Credit Agreement is hereby
amended by adding the following phrase immediately before the word “release” in
clause (ii) thereof: “except to the extent permitted in Section 7.06(a)(xvi)(C),”.

 

(f)                                    Section 7.14(a) of the Credit Agreement is hereby
amended to replace the table appearing therein with the following:

 

7

 

	
  Fiscal Year Ending October 31

  	
   

  	
  Amount

  	
   

  
	
  2004

  	
   

  	
  $

  	
  3,000,000

  	
   

  
	
  2005

  	
   

  	
  $

  	
  20,000,000

  	
   

  
	
  2006

  	
   

  	
  $

  	
  22,500,000

  	
   

  
	
  2007

  	
   

  	
  $

  	
  25,000,000

  	
   

  
	
  2008

  	
   

  	
  $

  	
  27,500,000

  	
   

  
	
  2009 and
  thereafter

  	
   

  	
  $

  	
  30,000,000

  	
   

  

 

Section 2.05  Amendment to Article X of the Credit
Agreement.  Section 10.07(b) of the Credit
Agreement is hereby amended: (i) by deleting the following language appearing
therein: “of $3,500 (except, in the case of contemporaneous assignments by any
Lender to one or more Approved Funds, only a single processing fee shall be
payable for such assignments), payable as agreed between the assigning Lender
and the assignee and which shall not be required to be paid by the Borrower;
and”; and (ii) by adding the following before the end thereof:

 

“(the “Assignment Fee”) of $2,500; provided, however,
that in the event of two or more concurrent assignments to members of the same
Assignee Group (which may be effected by a suballocation of an assigned amount
among members of such Assignee Group) or two or more concurrent assignments by
members of the same Assignee Group to a single Eligible Assignee (or to an
Eligible Assignee and members of its Assignee Group), the Assignment Fee will
be $2,500 plus the amount set forth below:

 

	
  Transaction

  	
   

  	
  Assignment
  Fee

  
	
  First
  four concurrent assignments or suballocations to members of an Assignee Group
  (or from members of an Assignee Group, as applicable)

  	
   

  	
  0

  
	
   

  	
   

  	
   

  
	
  Each
  additional concurrent assignment or suballocation to a member of such
  Assignee Group (or from a member of an Assignee Group, as applicable)

  	
   

  	
  $

  	
  500

  

 

Section 2.06  Amendment
to Other Provisions of the Credit Agreement.

 

(a)                                  Schedule 1.01D of the Credit Agreement is hereby
amended: (i) by deleting the first row captioned “Permitted Business
Acquisition”; (ii) by changing the Applicable Basket Amounts opposite “7.01(xi)
Debt of Foreign Subs” to $15,000,000 pertinent to the Senior Lenders and
$18,000,000 pertinent to the Second Lien Lenders; and (iii) by changing the
Applicable Basket Amount opposite “7.01(xvi) Foreign IP Transfers (IP)” to
$50,000,000 pertinent to the Senior Lenders and $60,000,000 pertinent to the
Second Lien Lenders.

 

ARTICLE III

CONDITIONS TO EFFECTIVENESS

 

Section 3.01  Conditions to Effectiveness of this First
Amendment. This First Amendment, and the
amendments, waivers and consents contained herein, shall become effective as of
the date hereof on the date (the “First Amendment Effective Date”) when
each of the following conditions precedent have been fulfilled to the
reasonable satisfaction of the Administrative Agent:

 

8

 

(a)                                  Execution and Delivery of this First
Amendment.
Holdings, the Borrower, the Required Lenders and each Lender with a Conversion
Commitment and/ or an Additional Term B Commitment shall have signed a
counterpart hereof (whether the same or different counterparts) and shall have
delivered (including by way of facsimile transmission) the same to Fried,
Frank, Harris, Shriver & Jacobson, LLP, One new York Plaza, 10004 Attention:
Joyce Chang (facsimile 212-859-8586.

 

(b)                                 Notes. There shall have been delivered to the
Administrative Agent for the account of each Consenting Lender and each Lender
with an Additional Term B Commitment which has requested the same an
appropriate Term B Note executed by the borrower in each case in the amount,
maturity and otherwise as provided in the Credit Agreement.

 

(c)                                  Consummation of IPO. A Qualifying IPO (determined without
reference to the minimum amount specified in the definition thereof) shall have
been (or shall concurrently be) consummated in accordance with applicable Law
resulting in cash proceeds to the Company (after underwriting discounts and
commissions and related expenses) of an amount not less than, and which shall
concurrently be applied to repay in full, the then unpaid principal amount of
all Second Lien Loans.

 

(d)                                 Payment of Certain Amounts. All accrued and unpaid interest on all
Term B Loans shall have been paid in full (regardless of whether or not the
Credit Agreement otherwise requires a payment of such interest at such time),
all fees, costs and expenses with respect to the Term B Loans shall have been
paid in full and the principal of all outstanding Term B Loans of
Non-Consenting Term B lenders shall have been repaid in full.

 

(e)                                  Acknowledgement. The Administrative Agent shall have
received counterparts of an Acknowledgement and Agreement, substantially in the
form of Exhibit A hereto, duly executed by each of the Loan Parties
(other than Holdings and the Borrower).

 

(f)                                    Corporate Proceedings. There shall have been delivered to the
Administrative Agent copies of resolutions of the board of directors of each
Loan Party approving and authorizing the execution, delivery and performance of
this First Amendments and the Loan Documents as amended by this First
Amendment, certified as of the First Amendment Effective Date by the corporate
secretary or an assistant secretary of such Loan Party as being in full force
and effect without modification or amendment.

 

(g)                                 Opinion of Counsel. The Administrative Agent shall have
received an opinion of counsel from Kirkland & Ellis, LLP in form and
substance reasonably satisfactory to the Administrative Agent, covering such
matters in connection with this First Amendment and the Transactions contemplated
hereby as the Administrative Agent may reasonably request.

 

(h)                                 Counsel Fees. The Administrative Agent shall have
received full payment from the Borrower of the fees and expenses of Fried,
Frank, Harris, Shriver & Jacobson LLP described in Section 5.05
of this First Amendment which are billed through the First Amendment Effective
Date.

 

(i)                                     Other. The Administrative Agent shall have received such
other documents, instruments, agreements or information as may be reasonably
requested by the Administrative Agent.

 

Section 3.02  General Conditions. All corporate and legal proceedings and
all instruments and agreements relating to the transactions contemplated by
this First Amendment or in any other document delivered in connection therewith
shall be reasonably satisfactory in form and substance to the Administrative
Agent and its counsel, and the Administrative Agent shall have received all
information and copies of all documents and papers, including records of
corporate proceedings,

 

9

 

governmental
approvals, good standing certificates and bring-down telegrams, if any, which
the Administrative Agent or any Lender may reasonably have requested, such
documents and papers where appropriate to be certified by proper corporate or
governmental authorities.  The documents
referred to in this Section shall be delivered to the Administrative Agent
no later than the First Amendment Effective Date.

 

Section 3.03  Effects of this First Amendment.

 

(a)                                  On the First Amendment Effective Date,
the Credit Agreement will be automatically amended to reflect the amendments
thereto provided for in this First Amendment. 
On and after the First Amendment Effective Date, the rights and obligations
of the parties hereto shall be governed by the Credit Agreement, as amended by
this First Amendment.  Once the First
Amendment Effective Date has occurred, all references to the Credit Agreement
in any document, instrument, agreement, or writing shall be deemed to refer to
the Credit Agreement as amended by this First Amendment.  Promptly after the First Amendment Effective
Date occurs, the Administrative Agent shall notify the Borrower and the Lenders
of the First Amendment Effective Date, and such notice shall be conclusive and
binding on all parties hereto.

 

(b)                                 Other than as specifically provided
herein, this First Amendment shall not operate as a waiver or amendment of any
right, power or privilege of the Administrative Agent or any Lender under the
Credit Agreement or any other Loan Document or of any other term or condition
of the Credit Agreement or any other Loan Document, nor shall the entering into
of this First Amendment preclude the Administrative Agent and/or any Lender
from refusing to enter into any further waivers or amendments with respect
thereto.  This First Amendment is not
intended by any of the parties hereto to be interpreted as a course of dealing
which would in any way impair the rights or remedies of the Administrative
Agent or any Lender except as expressly stated herein, and no Lender shall have
any obligation to extend credit to the Borrower other than pursuant to the
strict terms of the Credit Agreement and the other Senior Finance Documents, as
amended or supplemented to date (including by means of this First Amendment).

 

ARTICLE IV

REPRESENTATIONS AND WARRANTIES

 

Section 4.01  Representations and Warranties. In order to induce the Lenders to
consent to the amendments and waivers contained herein and to enter into this
First Amendment, each of Holdings and the Borrower represents and warrants as
set forth below:

 

(a)                                  After giving effect to this First
Amendment, the amendment of the Credit Agreement does not impair the validity,
effectiveness or priority of the Liens granted pursuant to the Collateral
Documents, and such Liens continue unimpaired with the same priority to secure
repayment of all Finance Obligations, whether heretofore or hereafter
incurred.  The position of the Lenders
with respect to such Liens, the Collateral in which a security interest was
granted pursuant to the Collateral Documents and the ability of the
Administrative Agent to realize upon such Liens pursuant to the terms of the
Collateral Documents have not been adversely affected in any material respect
by the amendment of the Credit Agreement effected pursuant to this First
Amendment or by the execution, delivery, performance or effectiveness of this
First Amendment.

 

(b)                                 Each of Holdings and the Borrower
reaffirms as of the First Amendment Effective Date its covenants and agreements
contained in the Credit Agreement and each Collateral Document and other Senior
Finance Document to which it is a party, including, in each case, as such
covenants and agreements may be modified by this First Amendment on the First
Amendment Effective.

 

10

 

Each of
Holdings and the Borrower further confirms that each such Senior Finance
Document to which it is a party is, and shall continue to be, in full force and
effect, and the same are hereby ratified, approved and confirmed in all
respects, except as the Credit Agreement may be modified by this First
Amendment.

 

(c)           Both immediately
before and immediately after giving effect to this First Amendment, the
representations and warranties set forth in Article V of the Credit
Agreement and each other Senior Finance Document are, in each case, true and
correct in all material respects (unless stated to relate solely to an earlier
date, in which case such representations and warranties shall be true and
correct in all material respects as of such earlier date).

 

(d)           This First
Amendment constitutes the legal, valid and binding obligation of each of
Holdings and the Borrower enforceable in accordance with its terms, subject to
the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors’ rights
generally, general equitable principles (whether considered in a proceeding in
equity or at law) and an implied covenant of good faith and fair dealing.

 

(e)           The parties
signatory to the Acknowledgment and Agreement delivered pursuant to Section 3.01(b)
of this First Amendment constitute all of the Persons who (together with
Holdings and the Borrower) are or are required under the terms of the Senior
Finance Documents to be Loan Parties.

 

(f)            The written
statements and information contained in this First Amendment and the other
documents, certificates and statements furnished to the Administrative Agent
and the Lenders on or prior to the First Amendment Effective Date by or on
behalf of any Loan Party for use in connection with the transactions
contemplated by this First Amendment, taken as a whole, do not, as of the First
Amendment Effective Date, contain any untrue statement of a material fact or omit
to state a material fact necessary in order to make the statements contained
therein not materially misleading.

 

ARTICLE V

MISCELLANEOUS

 

Section 5.01  Headings. The various headings of this First Amendment are
inserted for convenience only and shall not affect the meaning or
interpretation of this First Amendment or any provisions hereof.

 

Section 5.02  Execution in Counterparts. This First Amendment may be executed by
the parties hereto in several counterparts, each of which shall be deemed to be
an original and all of which shall constitute together but one and the same
agreement.  A counterpart hereof executed
and delivered by facsimile shall be effective as an original.

 

Section 5.03  Successors and Assigns. This First Amendment shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns.

 

Section 5.04
 Governing Law; Entire Agreement. THIS FIRST AMENDMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING
WITHOUT LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE
STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.  This First Amendment and the other Senior
Finance Documents constitute the entire understanding among the parties hereto
with respect to the subject matter hereof and supersede any prior agreements,
written or oral, with respect thereto.

 

11

 

Section 5.05  Fees and Expenses. The Borrower agrees to pay all
reasonable out-of-pocket expenses incurred by the Administrative Agent in
connection with the preparation, negotiation, execution, delivery and
enforcement of this First Amendment and the other documents and instruments
referred to herein or contemplated hereby, including, but not limited to, the
fees and disbursements of Fried, Frank, Harris, Shriver & Jacobson LLP,
counsel to the Administrative Agent.

 

Section 5.06  Senior Finance Document Pursuant to Credit
Agreement.
This First Amendment is a Senior Finance Document executed pursuant to the
Credit Agreement and shall be construed, administered and applied in accordance
with all of the terms and provisions of the Credit Agreement (and, following
the date hereof, the Credit Agreement, as amended hereby).

 

[Signature Pages Follow]

 

12

 

IN WITNESS WHEREOF, the signatories hereto have caused this First
Amendment to be executed by their respective officers thereunto duly authorized
as of the day and year first above written.

 

 

	
  HOLDINGS:

  	
  VERIFONE
  INTERMEDIATE HOLDINGS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ DOUGLAS
  G. BERGERON

  
	
   

  	
   

  	
  Name:
  Douglas G. Bergeron

  
	
   

  	
   

  	
  Title:
  Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  BORROWER:

  	
  VERIFONE,
  INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ DOUGLAS
  G. BERGERON

  
	
   

  	
   

  	
  Name:
  Douglas G. Bergeron

  
	
   

  	
   

  	
  Title:
  Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ADMINISTRATIVE
  AGENT:

  	
  BANK
  OF AMERICA, N.A.,

  as Administrative Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ JOAN MOK

  
	
   

  	
   

  	
  Name: Joan Mok

  
	
   

  	
   

  	
  Title: Assistant Vice
  President

  

 

S-1

 

	
  LENDERS:

  	
  SIGNATURE PAGE TO THE
  FIRST AMENDMENT DATED AS OF MARCH 23, 2005 TO THE CREDIT AGREEMENT DATED
  AS OF JUNE 30, 2004 AMONG VERIFONE INTERMEDIATE HOLDINGS, INC.,
  VERIFONE, INC., THE LENDERS PARTY THERETO FROM TIME, BANK OF AMERICA, N.A.,
  AS ADMINISTRATIVE AGENT, CREDIT SUISSE FIRST BOSTON, CAYMAN ISLANDS BRANCH,
  AS SYNDICATION AGENT, AND WELLS FARGO BANK, N.A., AS DOCUMENTATION AGENT BANK
  OF AMERICA, N.A., AS ADMINISTRATIVE AGENT

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BANK OF AMERICA, N.A., 

  as Administrative Agent and acting on behalf of and with the consent of the
  Required Lenders

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ JOAN MOK

  
	
   

  	
   

  	
  Name: Joan Mok

  
	
   

  	
   

  	
  Title:
  Assistant Vice President

  

 

S-2

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