FlexShopper, Inc. (NASDAQ:FPAY) Files An 8-K Entry into a Material Definitive Agreement

Item 1.01

Amendment No. 8 to Credit Agreement

On August 29, 2018, FlexShopper, Inc. (the Company), through a
wholly-owned indirect subsidiary (the Borrower), entered into
Amendment No. 8 (including related documentation, the Amendment)
to the Credit Agreement originally entered into on March 6, 2015
by and among the Borrower and WE 2014-1, LLC (in its capacity as
administrative agent under the Credit Agreement, the
Administrative Agent), an affiliate of Waterfall Asset
Management, LLC (Waterfall), and certain other lenders thereunder
from time to time (as amended from time to time, the Credit
Agreement). The Amendment amended the Credit Agreement to provide
that if the Company raises at least $15 million in equity funding
(an Equity Raise) on or before September 30, 2018, the Scheduled
Commitment Termination Date (as defined in the Credit Agreement)
will be extended to June 30, 2019 or such later date to be
determined by the Administrative Agent in its sole discretion,
but not later than February 28, 2021, by notice to the Borrower
on or before April 1, 2019; provided, however, if the Equity
Raise is not completed on or before September 30, 2018, the
Scheduled Commitment Termination Date will be a date determined
by the Administrative Agent in its sole discretion (by notice to
the Borrower), but in no event earlier than September 30, 2018 or
later than June 30, 2019. Proceeds of a successful equity raise
on or prior to September 30, 2018 are required to be used to
prepay loans under the Credit Agreement in an amount necessary
such that the outstanding principal balance thereof is less than
or equal to 95% of the Borrowing Base (as defined in the Credit
Agreement).

to the Amendment, upon the consummation of a successful raising
by the Company or its affiliates of equity funding on or prior to
September 30, 2018, the Borrower must maintain a reserve amount
of $1,000,000, which amount may be withdrawn by the
Administrative Agent to pay any amounts not paid by the Borrower
when due under the Credit Agreement or, in the discretion of the
Administrative Agent, to pay any other commercially reasonable
costs or expenses of the Borrower. If any portion of the reserve
amount is used in such manner, such reserve will be replenished
up to $1,000,000 in connection with the monthly applications of
proceeds under the Credit Agreement.

Additionally, the Amendment amended the Credit Agreement to
provide that, among other things, (1) if the Company completes
the Equity Raise on or before September 30, 2018, the interest
rate on loans under the Credit Agreement will be reduced to a low
double-digit percentage per annum beginning on February 1, 2019;
and (2) certain increased advance rates established by a previous
Credit Agreement amendment are extended through September 30,
2018; however, if the Equity Raise has not closed, (a) beginning
on September 17, 2018, the advance rate for certain Eligible
Leases (as defined in the Credit Agreement) existing prior to the
date of the Amendment will be reduced by a low single-digit
percentage each week and (b) the advance rate for such Eligible
Leases added to the Borrowing Base (as defined in the Credit
Agreement) on or after the date of the Amendment shall be a
percentage in the mid-nineties.

In connection with the contemplated Equity Raise, Waterfall
waived the piggyback registration rights of certain of its
investment management clients under that certain Investor Rights
Agreement, dated March 6, 2015, with respect to such an offering.
Additionally, on August 27, 2018, the Company and B2 FIE V LLC
entered into Amendment No. 2 to Investor Rights Agreement (the
Second Amendment to Investor Rights Agreement), such that the
piggyback registration rights under that certain Investor Rights
Agreement, dated June 10, 2016, shall not apply to an offering
registered on the Companys Registration Statement on Form S-1
(File No. 333-226823).

Amended and Restated Subordinated Promissory Notes

FlexShopper, LLC, a wholly-owned, direct subsidiary of the
Company, previously entered into letter agreements with each of
H. Russell Heiser, Jr., the Companys Chief Financial Officer, and
NRNS Capital Holdings LLC (NRNS) to which FlexShopper, LLC issued
a subordinated promissory note to each of Mr. Heiser and NRNS
(together, the Notes). On August 29, 2018, FlexShopper, LLC
amended and restated the Notes (the Amended Notes) such that (1)
the maturity date for the Notes was set at June 30, 2019 and (2)
in connection with the completion of the offering described in
the Registration Statement on Form S-1 initially filed by the
Company with the Securities and Exchange Commission on August 13,
2018, holders of the Notes may elect to convert up to 50% of the
outstanding principal of the Notes plus accrued and unpaid
interest thereon into shares of the Companys common stock at a
conversion price equal to the price paid to the Company by the
underwriters for shares of common stock sold in such offering,
net of the underwriting discount.

A copy of Amendment No. 8 to the Credit Agreement, the Second
Amendment to Investor Rights Agreement and the Amended Notes are
filed with this report as Exhibits 10.1, 10.2 and 10.3,
respectively, and are hereby incorporated by reference herein.
The foregoing descriptions of Amendment No. 8, the Second
Amendment to Investor Rights Agreement and the Amended Notes do
not purport to be complete and are qualified in their entirety by
reference to the full text of such documents.

The disclosures set forth in Item 1.01 above are incorporated by
reference into this Item 1.01.

(d) Exhibits.

FlexShopper, Inc. Exhibit
EX-10.1 2 f8k0818ex10-1_flexshopper.htm AMENDMENT NO. 8 TO CREDIT AGREEMENT,…
To view the full exhibit click here

About FlexShopper, Inc. (NASDAQ:FPAY)

FlexShopper, Inc. is a holding company. The Company, through FlexShopper, LLC (FlexShopper), is engaged in the business of providing certain types of durable goods to consumers on a lease-to-own basis and providing lease-to-own (LTO) terms to consumers of third-party retailers and e-tailers. FlexShopper and its online LTO products provide consumers the ability to acquire durable goods, including electronics, computers and furniture on a payment, lease basis. Concurrently, FlexShopper’s model provides e-tailers and retailers an opportunity to upturn their sales by utilizing FlexShopper’s online channels to connect with consumers that want to acquire products on an LTO basis. FlexShopper processes LTO transactions using its LTO Engine. The LTO Engine is FlexShopper’s technology that automates the process of consumers receiving spending limits and entering into leases for durable goods within a few minutes. FlexShopper owns two subsidiaries: FlexShopper 1, LLC and FlexShopper 2, LLC.